Hillary Clinton Attends Signing of New York College Tuition Law

On Wednesday, Hillary Clinton joined New York Governor Andrew Cuomo at LaGuardia Community College in Queens where she promoted the state’s new plan to provide free college tuition to in-state students whose family makes less than $100,000 a year. The income threshold to be eligible for free tuition will increase to $125,000 in 2019. The law requires that students who take part in the program to remain residents of New York for a number of years equal to the number of years they took part in the program.

Clinton applauded the plan in brief remarks today, as well as on Twitter. Clinton said, “I am here to today to reinforce what the governor has accomplished. He is absolutely right: education and training are the future.” She also said that the plan is a good framework for other states and the federal government. Clinton added, “Paying for college should not defer or destroy dreams. I’m hoping too that Congress will come to its senses and will understand we don’t need to be building walls, we need to be building bridges. And the best bridge to the future is a good education.”

For all the latest, follow our Scheduled Events page and follow the Clintons on Twitter @HillaryClinton, @billclinton, and @ChelseaClinton. You can also follow Hillary on Facebook and Instagram.

News Source: Democrat & Chronicle, New York Post, ABC News

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Senator Sanders Campaigns for Hillary in the Heartland

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Senator Bernie Sanders campaigned for Hillary Clinton in Iowa and Nebraska on Friday. His first events were in Davenport and Iowa City. During his speech at each event, Sanders stressed the importance of electing Democrats to ensure their progressive agenda become law. He spoke about Clinton’s plans to combat climate change, invest in clean energy, address campaign finance reform, reign in income inequality, and make college more affordable for students. Clinton’s college plan was developed with Sanders and he spoke about it in detail. He urged everyone to vote for Clinton and progressive platform saying, “The importance of this [platform] document is we are not going to let it sit on a shelf. We are going to incorporate those ideas into legislation to transform America. Iowa, thank you for making that possible.” Videos from the event in Iowa City are below.

In Cedar Rapids, Sanders spoke to a crowd of supporters on the campus of the University of Northern Iowa. He spoke about a number of Clinton’s platform points and the importance of electing progressives. He urged everyone to vote next Tuesday and encouraged the students to remain active in politics after the election saying, “But then the day after the election, after Hillary wins, I want you to pledge yourself to work as hard as you can with your friends and your co-workers to make this country what you and I know that we can become. Stand up for economic justice, social justice, racial justice, environmental justice. Let’s go forward and transform America.”

Sanders’ final event of the day was a rally in Omaha, Nebraska. Sanders maintained his progressive message talking about Clinton’s progressive platform and plans to raise the minimum wage and ensure that the wealthy pay their fair share in taxes. Sanders said that electing Donald Trump would be a disaster, but he also said that the election is going to be close. “My own gut feel is it’s going to be a very, very close election,” he said. Sanders urged everyone to get out and vote next Tuesday. A video from the event will be posted when/if available.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

News Source: Our Quad Cities, Iowa City Press-Citizen, The Courier, Omaha World-Herald

Senator Sanders Campaigns for Hillary in Ohio

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Senator Bernie Sanders campaigned on behalf of Hillary Clinton in Ohio today. Sanders’ first event was on the campus of Youngstown State University. During his speech, he focused on Hillary Clinton’s plans to build the middle class by introducing plans to create jobs and raise the minimum wage. He said, “Middle class shrinking, millions living in dire poverty, the very, very rich getting richer. Large corporations enjoying huge profits. That is where we are today and what our job together is, to create an economy that works for all Americans, not just the billionaire class.” Sanders said that Clinton has a plan to ensure the economy works for everyone while Donald Trump wants to ensure that he and other billionaires have free reign. Sanders concluded by urging everyone to vote and elect Clinton. A video of Sanders’ speech is below.

In Cincinnati, Sanders spoke to a crowd of supporters at the University of Cincinnati. He focused on the same populist platform points that gained him popularity including income inequality, raising the minimum wage, overturning Citizens United, making college more affordable, and combating climate change. Sanders said that Clinton has plans that address all those points, including some plans that he had a hand in crafting. He concluded by asking everyone to vote and challenged them to stay involved in politics after the election saying, “After we elect Hillary on Nov. 8, I want you to wake up on Nov. 9, roll up your sleeves and begin the process of taking on the billionaire class and transforming this country.” A video from the event is below.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

News Source: The Columbus Dispatch, WKBN, Cincinnati.com, WCPO

Trump’s Tax Troubles

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In just the few days since the New York Times published its latest groundbreaking report, Donald Trump has faced ongoing fallout from his “legally dubious” tax avoidance that even his own lawyers thought wouldn’t hold up to IRS scrutiny – as well as new reporting on his various efforts  to avoid paying millions in taxes. The ongoing reporting underscores the urgency of Trump releasing his tax returns before Election Day. While his campaign has objected to these stories, they refuse to release his tax returns – including just-filed returns that would not be under audit – to provide evidence of any untruths.

His behavior also raises important questions, including one that was posited by the New York Times Editorial Board: “Why would a man who has spent most of his professional life avoiding the shared responsibility of taxes all of a sudden care about helping others, especially those less fortunate?”

NEW Reporting

New York Times: Donald Trump Used Legally Dubious Method to Avoid Paying Taxes: “Tax experts who reviewed the newly obtained documents for The New York Times said Mr. Trump’s tax avoidance maneuver, conjured from ambiguous provisions of highly technical tax court rulings, clearly pushed the edge of the envelope of what tax laws permitted at the time. ‘Whatever loophole existed was not ‘exploited’ here, but stretched beyond any recognition,’ said Steven M. Rosenthal, a senior fellow at the nonpartisan Tax Policy Center who helped draft tax legislation in the early 1990s.”

Wall Street Journal: Income Taxes Aside: Donald Trump’s Other Tax-Avoidance Moves: “The Journal has found several additional examples of state and local tax issues for Mr. Trump and his companies that are little known or not previously reported on.”

  1. “A vendor said in a legal deposition in 2008 that Mr. Trump refused to pay $48,000 in sales taxes on draperies for a Las Vegas property.”
  1. “At least five federal, state and local tax collection agencies took out at least 26 liens on Mr. Trump’s businesses and him personally since the late 1990s due to claims that Mr. Trump or his businesses didn’t pay sales taxes, withholding taxes, or other corporate taxes.”
  1. “The biggest amount in liens and warrants, totaling about $11.8 million, were for corporate taxes imposed on his Indiana casino business in the early 2000s.”

Washington Post: This is the portrait of Donald Trump that his charity bought for $20,000: “Tax experts say that if Trump hung the painting at one of his homes or businesses, he may have violated laws against “self-dealing.” Those laws prohibit charity leaders from using money from their nonprofits to buy things for themselves, or for their businesses. In recent weeks, The Washington Post has reported other instances in which Trump may have violated those rules.”

Additional Fall-Out

New York Times Editorial Board: Avoiding Taxes, Trump-Style: “Indeed, even as Mr. Trump’s lawyers were advising him against this approach, one tax expert wrote that trying to find legal support for it was like trying to find evidence for ‘the existence of the Loch Ness monster.’”

Washington Post: A big, dirty secret from Donald Trump’s tax returns has been exposed: “Experts had missed Trump’s maneuver, Kleinbard said, because they did not think that it would have been allowed at the time… ‘The real surprise here is that he apparently got away with it’ … Kleinbard said that he would have enjoyed bringing Trump to court on behalf of the authorities in order to force him to pay up. ‘I would have been certain that I would have won.'”

Vox: Two experts say Donald Trump should be investigated for criminal tax evasion: “Various aspects of this almost certainly violate the laws governing charities (he’s already been sanctioned by the state of New York), but several experts are also raising the question of whether Trump is guilty of criminal tax evasion… But both Philip Hackney, a former IRS attorney now working as a professor of tax law, and Adam Chodorow, a tax law professor at Arizona State University, have written that the elements exist to at least begin an investigation.”

New York Times: How Donald Trump Avoided Paying Taxes Using Other People’s Money: “The story of how Mr. Trump sidestepped a potentially ruinous tax bill emerged from documents recently discovered by The Times during a search of casino bankruptcy filings. Mr. Trump structured his companies to allow him to have lucrative personal tax advantages, while limiting his personal liability should business go bad.”

Vanity Fair: How Donald Trump Used Other People’s Money to Avoid Paying Taxes: “Donald Trump is both unapologetic about using “other people’s money” whenever possible, and proud of the way he allegedly avoided paying income tax for years by writing off nearly a billion dollars in losses, as The New York Times first reported last month. Now, a new trove of documents obtained by the Times reveals how Trump combined both of those things to wipe out his liabilities, using investors’ money to avoid reporting hundreds of millions of dollars in taxable income in the form of canceled debt on his floundering casino empire—a maneuver that even his own lawyers warned would likely get him in trouble with the I.R.S.”

Mother Jones: NYT: We’ve Figured Out How Trump Gamed the Tax System: “If I’m reading this right, the basic story is that Trump gave his banks “New Bonds” in place of their old bonds and classified the new bonds as equity shares in the casino partnership. Trump then valued the equity as equal to the old debt, thus showing no net loan forgiveness and therefore no COD income. This despite the fact that, in reality, the equity was close to worthless.”

Vox: Donald Trump used a dubious loophole to make millions in taxable income disappear: “He has previously boasted publicly of his extensive and detailed knowledge of the tax code, which seems like a good prima facie reason to at least look into it a little. And the New York Times’s latest revelations show a man who was deliberately and knowingly aggressive in his tax strategies in other realms of his personal finances, intentionally pushing forward with a strategy his lawyers said would likely be disallowed.”

MSNBC: Trump stretched tax loopholes ‘beyond any recognition’: “The fact that Donald Trump didn’t pay federal income taxes for many years is not in dispute – because the Republican presidential candidate admitted it during a nationally televised debate. There is some question, however, about whether or not Trump’s exploitation of tax loopholes was entirely legal…. Don’t try this at home. Trump has tried to get away with tax maneuvers the typical American should not attempt.”

Los Angeles Times: Clinton renews calls for Trump to release tax returns following report he skirted laws: “Trump’s attorneys advised him at the time that if he were audited, the Internal Revenue Service would not look favorably upon the tactic, according to the report. For months now, Trump has eschewed releasing his tax returns, claiming he was under audit by the IRS. However, even while being audited, Trump could still release his returns, experts have said.”

Slate: We Now Have an Even Clearer Picture of How Brazenly Trump Tried to Avoid Paying Taxes: “Now, thanks to the latest investigation of Trump’s taxes by the New York Times, our portrait of Trump as a taxpayer is a little bit clearer: He isn’t just a businessman who’s so brilliant he managed to lose, either outright or on paper, close to $1 billion. He’s also one who tried to push the law to its limits—and perhaps past them—to avoid paying the tax man.”

IN CASE YOU MISSED IT

Avoiding Taxes, Trump-Style

New York Times

Editorial Board

November 1, 2016

Donald Trump’s claim that he was smart for figuring out how not to pay federal income taxes was obnoxious when he said it, at least for the millions of Americans who pay their fair share. Now we learn that he was able to avoid some of those taxes decades ago with a tactic that is illegal now and was highly dubious even then.

In the 1990s, with his Atlantic City casinos and other businesses tottering on the verge of collapse, Mr. Trump negotiated a deal under which his creditors — investors and banks — would forgive part of the debt in exchange for equity in partnerships he controlled. Without such swaps, Mr. Trump would have had to report the forgiven debt as income, offsetting a big portion of the $916 million loss he claimed on his tax return in 1995. That loss allowed him to avoid paying taxes for up to 18 years.

It is impossible to know whether the Internal Revenue Service challenged Mr. Trump’s use of the swaps because, unlike every major party presidential nominee for nearly 40 years, he refuses to release his tax returns. But as The Times reported on Monday, the maneuver was so suspect that his lawyers advised against it.

And it’s clear that even then tax officials and federal lawmakers were hoping to end the practice because it allowed businesses and rich individuals to avoid taxes by swapping forgiven debt with equity that was worth little or nothing. Indeed, even as Mr. Trump’s lawyers were advising him against this approach, one tax expert wrote that trying to find legal support for it was like trying to find evidence for “the existence of the Loch Ness monster.”

Congress barred such swaps by corporations in 1993, and by partnerships, the business structure Mr. Trump uses, in 2004.

As is its habit, Mr. Trump’s campaign chose to regard these latest revelations as yet another display of his genius. But like any other effort to game the tax system, his tactics imposed real costs by shifting the burden to taxpayers who have no recourse to such strategies and must pay full freight, including people whose taxes are withheld and cannot shelter their income even if they want to.

It has become ever more difficult for the I.R.S. to police the kind of tax avoidance Mr. Trump has engaged in. The Republican-controlled Congress cut the I.R.S.’s budget by about $500 million in 2015, and last year the agency audited just 0.8 percent of individual taxpayers, down from 1.1 percent in 2010. Its enforcement staff has shrunk by 23 percent since 2010, to 39,000 people, according to the Center on Budget and Policy Priorities.

The latest disclosures about Mr. Trump’s taxes also further undercut the argument that he is uniquely qualified to fix what he has called a rigged system. Why would a man who has spent most of his professional life avoiding the shared responsibility of taxes all of a sudden care about helping others, especially those less fortunate? The truth is, of course, that he has no intention of doing so; according to a recent analysis by the nonpartisan Tax Policy Center, Mr. Trump’s tax proposals would confer by far the greatest advantages on the wealthiest Americans.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

Chelsea Clinton Campaigns for her Mother in Colorado and Wisconsin

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Chelsea Clinton spoke at a Get Out the Vote event in Boulder, Colorado this morning where she urged supporters to get out and vote on November 8th. During her speech, Chelsea spoke about a number of Hillary Clinton’s platform points including her plans to raise the minimum wage and make college more affordable. She made the case for her mother saying, “This election is both about defeating Donald Trump and electing a woman who has been fighting for and delivering for children and families and women for literally longer than I’ve been alive. And I believe that if we keep talking to people about what is actually at stake in this election, we will win.” A video from the event is below.

Chelsea then traveled to Wisconsin where she spoke with supporters in Eau Claire and Oshkosh. At each event, Chelsea outlined her mother’s blueprint for America and spoke about a number of Hillary’s proposed policies including criminal justice reform and introducing common sense gun control. Chelsea also spoke about her mother’s plan to pay for her proposals by increasing taxes on those making over $250,000 per year. Meanwhile, middle class Americans, those making less then that amount, will not see any tax increases. Chelsea called the election the most important in her lifetime and urged everyone to vote on November 8th. Videos from the events will be added when/if available.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

News Source: CBS Denver, WEAU, Fox 11

Statement on Trump’s “Legally Dubious” Tax Avoidance Scheme

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Calls on Trump to Release at Least 2015 Tax Returns, Which Are Not Under Audit

Yesterday, the New York Times published new documents that showed Trump engaged in “legally dubious” schemes to avoid paying millions in federal income taxes, even as his own lawyers made clear they likely would not hold up to IRS scrutiny. Trump’s campaign claims the reporting is not true, yet they refuse to produce the only evidence that could prove the Times wrong: Trump’s tax returns.

In response to the new report, Hillary for America deputy communications director Christina Reynolds issued the following statement:

“In the wake of a blockbuster report showing that even Trump’s own lawyers thought the IRS would likely find the “legally dubious” scheme he used to avoid taxes was against the law, the Trump campaign still refuses to release his tax returns. While breaking a precedent running for 40 years, Trump has clung to the excuse that he is under audit, despite no proof that he is and no prohibition for releasing returns under audit. Given that Trump was required to file his 2015 taxes recently, he has no reason to withhold it since it is too soon for him to possibly be under audit for those year. There’s no excuse left for Trump—if he’s not still using these “dubious” schemes to avoid paying taxes, he needs to prove it with his most recent tax returns.”

Trump and his campaign continue to dodge disclosure of these critical documents that could shed light on important issues including his wealth, his questionable charitable giving, his foreign and domestic business entanglements, his personal tax rate and more. The Times’ reporting raising important new questions that underscore the urgency in releasing the tax returns before Election Day.

Key Point: “As he scrambled to stave off financial ruin, Mr. Trump avoided reporting hundreds of millions of dollars in taxable income by using a tax avoidance maneuver so legally dubious his own lawyers advised him that the Internal Revenue Service would likely declare it improper if he were audited.”

  • “Tax experts who reviewed the newly obtained documents for The New York Times said Mr. Trump’s tax avoidance maneuver, conjured from ambiguous provisions of highly technical tax court rulings, clearly pushed the edge of the envelope of what tax laws permitted at the time. ‘Whatever loophole existed was not ‘exploited’ here, but stretched beyond any recognition,’ said Steven M. Rosenthal, a senior fellow at the nonpartisan Tax Policy Center who helped draft tax legislation in the early 1990s.”
  • “One letter, 25 pages long, analyzed seven distinct components of Mr. Trump’s proposed tax maneuver. It found only “substantial authority” for six of the components. In the stilted language of tax opinion letters, the phrase “substantial authority” is a red flag that the lawyers believe the I.R.S. can be expected to rule against the taxpayer roughly two-thirds of the time. In other words, Mr. Trump’s tax lawyers were telling him there were at least six different reasons the I.R.S. would likely cry foul if he were audited.”
  • “Regardless of whether the I.R.S. objected, Trump’s tax avoidance in this case violated a central principle of American tax law, said Mr. Buckley, the former chief of staff for Congress’s Joint Committee on Taxation, who later served as chief tax counsel for Democrats on the House Ways and Means Committee. ‘He deducted somebody else’s losses,’ Mr. Buckley said.”

IN CASE YOU MISSED IT

Donald Trump Used Legally Dubious Method to Avoid Paying Taxes

New York Times

By: David Barstow, Mike McIntire, Patricia Cohen, Susanne Craig, and Russ Buettner

October 31, 2016

Donald J. Trump proudly acknowledges he did not pay a dime in federal income taxes for years on end. He insists he merely exploited tax loopholes legally available to any billionaire — loopholes he says Hillary Clinton failed to close during her years in the United States Senate. “Why didn’t she ever try to change those laws so I couldn’t use them?” Mr. Trump asked during a campaign rally last month.

But newly obtained documents show that in the early 1990s, as he scrambled to stave off financial ruin, Mr. Trump avoided reporting hundreds of millions of dollars in taxable income by using a tax avoidance maneuver so legally dubious his own lawyers advised him that the Internal Revenue Service would likely declare it improper if he were audited.

Thanks to this one maneuver — which was later outlawed by Congress — Mr. Trump potentially escaped paying tens of millions of dollars in federal personal income taxes. It is impossible to know for sure because Mr. Trump has declined to release his tax returns, or even a summary of his returns, breaking a practice followed by every Republican and Democratic presidential candidate for more than four decades.

Tax experts who reviewed the newly obtained documents for The New York Times said Mr. Trump’s tax avoidance maneuver, conjured from ambiguous provisions of highly technical tax court rulings, clearly pushed the edge of the envelope of what tax laws permitted at the time. “Whatever loophole existed was not ‘exploited’ here, but stretched beyond any recognition,” said Steven M. Rosenthal, a senior fellow at the nonpartisan Tax Policy Center who helped draft tax legislation in the early 1990s.

Moreover, the tax experts said the maneuver trampled a core tenet of American tax policy by conferring enormous tax benefits to Mr. Trump for losing vast amounts of other people’s money — in this case, money investors and banks had entrusted to him to build a casino empire in Atlantic City.

As that empire floundered in the early 1990s, Mr. Trump pressured his financial backers to forgive hundreds of millions of dollars in debt he could not repay. While the cancellation of so much debt gave new life to Mr. Trump’s casinos, it created a potentially crippling problem with the Internal Revenue Service. In the eyes of the I.R.S., a dollar of canceled debt is the same as a dollar of taxable income. This meant Mr. Trump faced the painful prospect of having to report the hundreds of millions of dollars of canceled debt as if it were hundreds of millions of dollars of taxable income.

But Mr. Trump’s audacious tax-avoidance maneuver gave him a way to simply avoid reporting any of that canceled debt to the I.R.S. “He’s getting something for absolutely nothing,” John L. Buckley, who served as the chief of staff for Congress’s Joint Committee on Taxation in 1993 and 1994, said in an interview

The new documents, which include correspondence from Mr. Trump’s tax lawyers and bond offering disclosure statements, might also help explain how Mr. Trump reported a staggering loss of $916 million in his 1995 tax returns — portions of which were first published by The Times last month.

United States tax laws allowed Mr. Trump to use that $916 million loss to cancel out an equivalent amount of taxable income. But tax experts have been debating how Mr. Trump could have legally declared a deduction of that magnitude at all. Among other things, they have noted that Mr. Trump’s huge casino losses should have been offset by the hundreds of millions of dollars in taxable income he surely must have reported to the I.R.S. in the form of canceled casino debt.

By avoiding reporting his canceled casino debt in the first place, however, Mr. Trump’s $916 million deduction would not have been reduced by hundreds of millions of dollars. He could have preserved the deduction and used it instead to avoid paying income taxes he might otherwise have owed on books, TV shows or branding deals. Under the rules in effect in 1995, the $916 million loss could have been used to wipe out more than $50 million a year in taxable income for 18 years.

Mr. Trump declined to comment for this article.

“Your e-mail suggests either a fundamental misunderstanding or an intentional misreading of the law,” Hope Hicks, Mr. Trump’s spokeswoman, said in a statement. “Your thesis is a criticism, not just of Mr. Trump, but of all taxpayers who take the time and spend the money to try to comply with the dizzyingly complex and ambiguous tax laws without paying more tax than they owe. Mr. Trump does not think that taxpayers should file returns that resolve all doubt in favor of the I.R.S. And any tax experts that you have consulted are engaged in pure speculation. There is no news here.”

Mr. Trump financed his three Atlantic City gambling resorts with $1.3 billion in debt, most of it in the form of high interest junk bonds. By late 1990, after months of escalating operating losses, New Jersey casino regulators were warning that “a complete financial collapse of the Trump Organization was not out of the question.” By 1992, all three casinos had filed for bankruptcy and bondholders were ultimately forced to forgive hundreds of millions of dollars in debt to salvage at least part of their investment.

The story of how Mr. Trump sidestepped a potentially ruinous tax bill from that forgiven debt emerged from documents recently discovered by The Times during a search of the casino bankruptcy filings. The documents offer only a partial description of events, and none of Mr. Trump’s tax lawyers agreed to be interviewed for this article.

At the time, Mr. Trump would have been hard-pressed to pay tens of millions of dollars in taxes. According to assessments of his financial stability by New Jersey casino regulators, there were times in the early 1990s when Mr. Trump had no more than a few million dollars in his various bank accounts. He was so strapped for cash that his creditors were apoplectic when they learned that Mr. Trump had bought Marla Maples an engagement ring estimated to be worth $250,000.

It is unclear who first glimpsed a way for Mr. Trump to dodge a huge tax bill. But the basic maneuver he used was essentially a new twist on a contentious strategy corporations had been using for years to avoid taxes created by canceled debt.

The strategy — known among tax practitioners as a “stock-for-debt swap” — relies on mathematical sleight of hand. Say a company can repay only $60 million of a $100 million bank loan. If the bank forgives the remaining $40 million, the company faces a large tax bill because it will have to report that canceled $40 million debt as taxable income.

Clever tax lawyers found a way around this inconvenience. The company would simply swap stock for the $40 million in debt it could not repay. This way, it would look as if the entire $100 million loan had been repaid, and presto: There would be no tax bill due for $40 million in canceled debt.

Best of all, it did not matter if the actual market value of the stock was considerably less than the $40 million in canceled debt. (Stock in an effectively insolvent company could easily be next to worthless.) Even in the opaque, rarefied world of gaming impenetrable tax regulations, this particular maneuver was about as close as a company could get to waving a magic wand and making taxes disappear.

Alarmed by the obvious potential for abuse, Congress and the I.R.S. made repeated efforts during the 1980s to curb this brand of tax wizardry before banning its use by corporations altogether in 1993. But while policy makers were busy trying to stop corporations from using this particular ploy, the endlessly creative club of elite tax advisers was inventing a new way to circumvent the ban, this time through the use of partnerships.

This was the twist that was especially beneficial to Mr. Trump. Wealthy families like the Trumps often own real estate and other assets through partnerships rather than corporations. Mr. Trump, for example, owned all three of his Atlantic City casinos through partnerships, an arrangement that allowed casino profits to flow directly to his personal tax returns when times were good.

But what if times were bad? What if Mr. Trump’s casino partnerships could not repay hundreds of millions of dollars they owed to bondholders? And what if the bondholders were persuaded to forgive this debt? Wouldn’t that force the partnerships — i.e., Mr. Trump — to report hundreds of millions of dollars of taxable income in the form of canceled debt?

Enter the tax advisers with their audacious plan: Why not eliminate all that taxable income from canceled debt by swapping “partnership equity” for debt in exactly the same way corporations had been swapping company stock for debt.

True enough, the I.R.S. and Congress had clearly signaled their disapproval of the basic concept. Fred T. Goldberg, who was the I.R.S. commissioner under George Bush, recalled in an interview that the I.R.S. frowned on partnership equity-for-debt swaps for the same reason it objected to corporate stock-for-debt swaps. “The fiction is that the partnership interest has the same value as the debt,” he said. Lee A. Sheppard, a contributing editor to Tax Notes, wrote in 1991 that trying to find a legal justification for this tactic was akin to proving “the existence of the Loch Ness monster.”

On the campaign trail, Mr. Trump boasts of his mastery of tax loopholes and claims no other candidate for the White House has ever known more about the tax code. This background, he argues with evident disgust, gives him special insight into the way wealthy elites buy off politicians and hire high-priced lawyers and accountants to rig the tax system — just as, he claims, they rig elections.

That insight was on display in 1991 and 1992 when he was laying the groundwork to make a multimillion-dollar tax bill disappear.

Before proceeding with his plan, Mr. Trump did what most prudent taxpayers do — he sought a formal tax opinion letter. Such letters, typically written by highly-paid lawyers who spend entire careers mastering the roughly 10,000 pages of ever-changing statutes that make up the United States tax code, can provide important protection to taxpayers. As long as a tax adviser blesses a particular tax strategy in a formal opinion letter, the taxpayer most likely will not face penalties even if the I.R.S. ultimately rules the strategy was improper.

The language used in tax opinion letters has a specialized meaning understood by all tax professionals. So, for example, when a tax lawyer writes that a shelter is “more likely than not” going to be approved by the I.R.S., this means there is at least a 51 percent chance the shelter will withstand scrutiny. (This is known as an “M.L.T.N.” letter in the vernacular of tax lawyers.) A “should” letter means there is about a 75 percent chance the I.R.S. will not object. The gold standard, a “will” letter, means the I.R.S. is all but certain to bless the tax avoidance strategy.

But the opinion letters Mr. Trump received from his tax lawyers at Willkie Farr & Gallagher were far from the gold standard. The letters bluntly warned that there was no statute, regulation or judicial opinion that explicitly permitted Mr. Trump’s tax gambit. “Due to the lack of definitive judicial or administrative authority,” his lawyers wrote, “substantial uncertainties exist with respect to many of the tax consequences of the plan.”

One letter, 25 pages long, analyzed seven distinct components of Mr. Trump’s proposed tax maneuver. It found only “substantial authority” for six of the components. In the stilted language of tax opinion letters, the phrase “substantial authority” is a red flag that the lawyers believe the I.R.S. can be expected to rule against the taxpayer roughly two-thirds of the time. In other words, Mr. Trump’s tax lawyers were telling him there were at least six different reasons the I.R.S. would likely cry foul if he were audited. In anticipation of that possibility, the lawyers even laid out a fallback plan that would have allowed Mr. Trump to spread the pain of a large tax hit over many years if the I.R.S. ultimately balked.

It is unclear whether the I.R.S. ever challenged Mr. Trump’s use of this specific tax maneuver. According to a financial disclosure statement prepared by Mr. Trump’s accountants, he was under audit by tax authorities as of 1993, only a year after he avoided reporting hundreds of millions of dollars in taxable income because of this legally suspect tactic. But the results of that audit are unknown and the agency declined to comment on Monday.

Regardless of whether the I.R.S. objected, Mr. Trump’s tax avoidance in this case violated a central principle of American tax law, said Mr. Buckley, the former chief of staff for Congress’s Joint Committee on Taxation who later served as chief tax counsel for Democrats on the House Ways and Means Committee.

“He deducted somebody else’s losses,” Mr. Buckley said. By that Mr. Buckley means that only the bondholders who forgave Mr. Trump’s unpaid casino debts should have been allowed to use those losses to offset future income and reduce their taxes. That Mr. Trump used the same losses to reduce his taxes ultimately increases the tax burden on everyone else, Mr. Buckley explained. “He is double dipping big time.”

In any event, Mr. Trump can no longer benefit from the same maneuver. Just as Congress acted in 1993 to ban stock-for-debt swaps by corporations, it acted in 2004 to ban equity-for-debt swaps by partnerships.

Among the members of Congress who voted to finally close the loophole: Senator Hillary Clinton of New York.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

Senator Elizabeth Warren Encourages Voting in Pittsburgh

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Senator Elizabeth Warren campaigned on behalf of Hillary Clinton in Pittsburgh, Pennsylvania today. Warren spoke about Clinton’s plans to help the middle class by raising the minimum wage, creating new jobs, and boosting the economy by investing in the country’s infrastructure. Warren also asked voters to help Democrats win back the Senate by voting for Senate hopeful Katie McGinty. Warren said that McGinty is a fighter that will ensure that the progress proposed by a Clinton administration will get carried out. Warren concluded her speech by urging everyone to vote on November 8th. A video from the event will be posted when/if available.

Meanwhile, in Queens, New York a fundraiser was held on behalf of Hillary for America. The event featured a conversation with Democratic Caucus Vice-Chair Representative Joe Crowley.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

News Source: Pittsburgh Post-Gazette, WTAE

Bill Clinton Continue Bus Tour Campaign in Florida

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On Saturday, Bill Clinton continued his bus tour in Florida with his first event in Panama City. During his speech, Bill spoke about Hillary Clinton’s plans and optimism for the America’s future. Bill said that while Republican Donald Trump seems to be wanting to return America to the past, Hillary has a plan to ensure that America continues to grow into the future. A plan that involves investment in the United States’ infrastructure, economy, and the American people. He said that the difference between the two campaigns is attitude…one is positive and optimistic while the other is negative, but it will be important for both sides to come together following the election. “I want you to show one difference between our campaign and the other campaign. I don’t think they like us very much, but I want you to go to them and say, ‘We want you to be part of America’s future, too. We need you.’” Watch a video of Bill’s speech below.

Bill then traveled to Pensacola where he continued his focus on Hillary’s optimistic blueprint for America, one that invests in America’s future and not just those at the top. Bill said that Hillary has a plan to create new jobs and ensure that the middle class has an opportunity to grow. He wrapped up his speech by asking for everyone to vote on November 8th and to vote for Hillary. A video from the event will be added when/if available.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

News Source: News Herald, Pensacola News Journal

Hillary Clinton Answers New York Times Readers’ Questions

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The editorial board of The New York Times asked readers to select from a list of questions the one that they would most like both presidential candidates, Hillary Clinton and Donald Trump, to answer. The three questions that received the most votes were about climate change, income inequality, and gun violence. Read Clinton’s answers below, or click HERE to read both candidates’ answers.

1. It is widely accepted scientific fact that climate change is real and potentially catastrophic. What specific action will you take in the next four years?

Hillary Clinton: Climate change is real, and we have a moral obligation to leave our children and grandchildren a better planet. I believe we can fight climate change and create millions of good-paying jobs at the same time.

Some nation is going to be the clean energy superpower of the 21st century. It’s either going to be Germany, China or us, and I want to make sure that it’s us. And we can do it in a way that means no one gets left out or left behind.

I’ve laid out specific plans to modernize our electric grid with enough renewable energy to power every home in America within a decade, including 500 million solar panels by the end of my first term. I want to launch a Clean Energy Challenge to partner with cities, states, and rural communities that are ready to lead on clean energy, clean transportation, and energy efficiency, and help them go further.

We’ll invest in resilient infrastructure that will protect communities like those in North Carolina, Iowa, and Louisiana that have seen terrible floods just this year. We know that low-income communities and communities of color are disproportionately affected by pollution and by extreme weather, and climate change is only going to make that worse. So I will make environmental and climate justice a priority, including eliminating lead as a major public health threat within five years.

We’re already less dependent on foreign oil than we have been in decades, but we can go further, reduce oil consumption by a third, and do more to power America with home-grown wind, solar, and advanced biofuels.

And I have a real plan to invest in creating jobs and building stronger economies in coal country. America’s coal communities have kept our lights on and our factories running for generations, and I won’t let them be left in the dark.

Finally, I believe the United States needs to continue to lead the global effort to combat climate change. I will fulfill the pledge President Obama made in the Paris Climate Agreement and seek to go further by cutting emissions up to 30 percent below 2005 levels by 2025. We need to implement the breakthrough we achieved just last week in the Montreal Protocol to phase down super-polluting HFCs and avoid as much as half a degree of warming.

Not only does America need to lead, we need to do more to work with our neighbors. We trade more energy with Canada and Mexico than with the rest of the world combined. That’s why I want to negotiate a North American Climate Compact to cut emissions and accelerate the clean energy transition across the continent.

I won’t let the climate deniers stand in the way of progress, or let us give in to the climate defeatists who say this challenge is too big to solve. We can and will take on climate change, build a clean energy economy, and leave our kids and grandkids a safe and healthy world—because there is no Planet B.

2. What would you do to reduce the extreme income inequality in this country?

Hillary Clinton: Too many hardworking Americans have the deck stacked against them. No one who works hard should have to raise their kids in poverty, or worry they won’t be able to retire with dignity.

But the majority of the income growth since the Great Recession has gone to people at the top. Working people haven’t gotten a raise in 15 years. Right now, the top one-tenth of one percent of Americans own almost as much wealth as the bottom 90 percent combined. We haven’t seen this level of wealth inequality since right before the Great Depression.

We need an economy that works for everyone, not just those at the top. For starters, I’ll raise the federal minimum wage and guarantee equal pay for women. And we’ll promote profit-sharing—the workers who help make their companies profitable should be able to share in that success the way executives do.

We need to create more good jobs that pay enough to raise a family. So we’ll make the biggest investment in good jobs since World War II—jobs in infrastructure, advanced manufacturing, and clean energy. We need to make sure that jobs in home health care, child care, and other fields provide good pay and good benefits, and make it easier for workers to organize and bargain collectively in all industries. We need to do more to support small businesses that create so many new jobs. And we need to make it easier for people to be good employees and good parents by guaranteeing 12 weeks of paid family and medical leave for every worker.

We also need to go after intergenerational poverty. Every child in America should be able to live up to his or her God-given potential, no matter who your parents are or what ZIP code you grew up in. That’s why I’m going to make pre-school universal for every four-year-old in America.

It’s also why we’re going to embrace approaches like South Carolina Congressman Jim Clyburn’s 10-20-30 plan, where 10 percent of federal investments are made in communities where 20 percent of the people have been living in poverty for the last 30 years. Let’s address the systemic problems that have kept too many in poverty for far too long.

Lastly, we need more fairness in our tax system. By closing the loopholes and requiring those at the top to pay their fair share in taxes, we can help cover the cost of vital investments that will create jobs and opportunity for middle-class families and help lift millions out of poverty. Around two-thirds of the burden of my tax plan falls on the highest earning 0.1 percent of taxpayers.

Here’s what we won’t do. We won’t raise taxes on people making less than $250,000. And we won’t spend trillions of dollars giving huge new tax breaks to the wealthy and big corporations. They’ve seen the gains in recent years—they should pay their fair share to make the investments that will grow the economy for everyone.

3. What would your administration do to reduce gun violence and mass shootings?

Hillary Clinton: We lose an average of 90 Americans every day because of guns. Since I launched my campaign for the presidency in April of 2015, that means more than 50,000 people have been killed by gun violence in America.

I’ve met some of their families, and countless others whose lives have been forever changed by gun violence. I’ve traveled the country with mothers like Lucy McBath, whose 17-year-old son Jordan was shot and killed for playing music. I’ve been inspired by advocates like Erica Smegielski, whose mother Dawn died trying to protect her students at Sandy Hook School. And I’ve prayed with residents in cities like Charleston, one of the many communities across our country that have been devastated by this epidemic.

For decades, people have said this issue was too hard to solve and the politics too hot to touch. But as I’ve listened to the stories in every corner of our country, one question has stayed at the front of my mind: How can we just stand by and do nothing?

That simple answer is: We can’t.

So here’s what I think we need to do. First, we need to expand background checks to include more gun sales, like those at gun shows and over the Internet. There’s no reason a domestic abuser should be able to go online and buy a gun with no questions asked. And we need to close other loopholes, like the so-called “Charleston Loophole” that allows dangerous people to buy guns without a background check if that check isn’t completed within three days.

Second, we need to hold the gun industry accountable, and end laws that shield them from liability when they break the law. We saw that just this month, when one of those laws was used to block the families of the Sandy Hook shooting from having their day in court.

Finally, we need to keep military-style weapons off our streets. They are a danger to law enforcement and to our communities.

By taking these common sense steps, we can keep our children safe and respect the Second Amendment. The vast majority of Americans support measures like these. So our challenge isn’t finding common ground. It’s getting politicians to listen to their constituents rather than the gun lobby.

For that to happen we need to say, loudly and clearly, that gun violence is an issue that matters. And we need to vote accordingly.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.

News Source: The New York Times

Hillary’s Plan: Debt and Entitlements

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Clinton Will Fight For Medicare & Social Security, Pay For Her Plans; Trump Will Risk These Programs & Add Trillions To Debt

Tonight, voters will hear from Hillary Clinton and Donald Trump on six topics of national importance: debt and entitlements, immigration, economy, the Supreme Court, foreign policy, and the fitness of the candidates to serve as president.

Clinton has stood up for Medicare, Social Security, and Medicaid her entire career, and she will not stop now.  She will ensure the wealthy, Wall Street, and big corporations pay their fair share, invest in middle-class families, and defend and expand Medicare and Social Security.  Furthermore, her new plans are paid for, so they will not add to the national debt.

Conversely, Trump’s plans will add $21 trillion to the national debt over 20 years and give reckless tax cuts to the wealthy instead of investing in Medicare and Social Security for generations to come.

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Hillary’s vision on fiscal matters is clear. As she has said before, “We know what sound fiscal policy looks like and it sure isn’t running up massive debts to pay for giveaways to the rich. And it is not painful austerity that hurts working families and undercuts our long-term progress. It’s being strong, stable, and making smart investments in our future. So let’s set the right priorities and pay for them, so we can hand our children a healthier economy and a better future.”

Hillary has put forward credible plans to pay for her proposals without adding to the national debt.  As president, Hillary will:

  • Continue to put forth plans that add up, are paid for, and will not add to the national debt. As the Committee for a Responsible Federal Budget said recently, “We are encouraged that Clinton continues to largely pay for her new spending…”
  • Restore fairness to the tax code and make sure the wealthiest Americans pay their fair share. The independent, non-partisan Urban-Brookings Tax Policy Center found that around 2/3rds of the revenue from Hillary’s tax plan came from the top 0.1%, earning more than $3.7 million per year.
  • NYT: “Mrs. Clinton would substantially raise taxes on high-income taxpayers, mostly on the top 1 percent; … reduce taxes on average for middle- and low-income households; and overhaul corporate taxes. Her plan would increase federal revenue $1.4 trillion over the first decade….Mrs. Clinton would use the money to pay for education and other initiatives.”
  • Hillary has a responsible, progressive fiscal vision. Progressive policies such as investing in growth and the middle class, and asking the wealthy to pay their fair share – not trillions of dollars in tax cuts for the wealthy, have been successful. For example, President Bill Clinton took a $300 billion deficit in the year before he took office and turned it into a $200 billion surplus.

Hillary believes seniors have paid into Social Security for a lifetime, and they’ve earned these benefits when they retire. Social Security isn’t just a program—it’s a promise.  As president, Hillary will:

  • Defend Social Security against Republican attacks and attempts to privatize the program – and refuse to embrace proposals to raise the retirement age or reduce cost-of-living adjustments
  • Expand Social Security for those who need it most and who are treated unfairly by the current system—including women who are widows and those who took significant time out of the paid workforce to take care of their children, aging parents, or ailing family members.
  • Preserve Social Security for decades to come by asking the wealthiest to contribute more.

Hillary believes Medicare and Medicaid are the bedrock of health care coverage for more than 50 million Americans, from seniors to people with disabilities.  As president, Hillary will:

  • Fight to preserve Medicare benefits for Americans – and stand strongly against Republican attempts to “phase out” or privatize Medicare.
  • Require drug manufacturers to provide rebates for low-income Medicare enrollees that are equivalent to rebates in the Medicaid program through her prescription drug plan.
  • Reduce the cost of prescription drugs for seniors by allowing Medicare to use its leverage with more than 40 million enrollees to negotiate drug and biologic prices.
  • Tackle rising medical costs by expanding value-based delivery system reform in Medicare.
  • Help protect consumers from unjustified price hikes for long-available drugs.
  • Ensure we expand Medicaid in the states where Republican governors and legislatures have refused to do so.

Donald Trump may have abused the tax system to avoid paying taxes into Social Security and Medicare – Hillary Clinton would help end this practice. Based on what we do know about Donald Trump’s tax returns, independent experts at the Tax Policy Center believe that Trump may have avoided paying his fair share in taxes into Social Security and Medicare by abusively taking advantage of the so-called “Gingrich-Edwards” loophole. This loophole allows some high-income business people to funnel their wages through a business.  While the law still requires these business owners to pay payroll taxes on a reasonable portion of compensation, Trump may have flouted this legal requirement and avoided paying his fair share in payroll taxes that support programs like Social Security and Medicare. Earlier this year, Hillary Clinton embraced a proposal from President Obama’s budget that would end such abuses and crack down on tax gaming by high-income individuals through shifting business income, including addressing the so-called “Gingrich-Edwards” loophole.

Donald Trump’s tax plan would increase the debt by $21 trillion over 20 years to give tax cuts to the rich, and he has recklessly considered defaulting on the national debt.

  • Trump infamously called himself the “king of debt” and has proposed a tax plan that would increase our national debt by 21 trillion over 20 years – with more than half of the benefits going to the top 1%.
  • Trump displayed his willingness to play Russian roulette with the full faith and credit of the U.S., suggesting recently that “you could make the case” for defaulting on the debt, or maybe we could just “make a deal.” Defaulting on our debt would undermine more than 200 years of confidence in the American economy, and could cause a global financial crisis.

Paying for Donald Trump’s tax cuts for the rich could require cutting Medicare and Social Security by trillions:

  • As an analysis by CAP Action explains, “Trump says his agenda ‘will be completely paid-for,’ but paying for his tax plan would require cutting federal spending by an average of approximately 13.5 percent. In the next 10 years, an across-the-board cut of 13.5 percent would mean cutting Social Security by $1.7 trillion and cutting Medicare by $1.1 trillion.”

Trump is willing to jeopardize Medicare, Medicaid and Social Security, which he once called a Ponzi scheme.

Trump’s plan to block grant Medicaid could cause millions of low-income adults and people with disabilities to lose or see lower benefits.

For all the latest, follow our Scheduled Events page and follow Clinton on TwitterFacebookYouTube, and Instagram. Also, be sure to subscribe to the campaign’s official Podcast, With Her.