President Donald Trump’s White House ballroom may be his most visible project, but his most lucrative one is playing out through his golf courses, according to a new Forbes analysis.
Trump has been using a tax strategy known as "conservation easements," Forbes reported. An owner permanently gives up the right to develop a piece of land, then claims a charitable deduction based on what that land could have been worth if it were built on. The owner keeps the property. In Trump’s case, that means his courses stay open for business.
The payoff is enormous. Forbes estimates Trump "has already claimed about $1.2 billion in deductions, saving roughly $450 million in taxes." He may have another "estimated $3.2 billion in potential write-offs" still available, which could allow him "to dodge $1.2 billion of taxes," Forbes' Dan Alexander projected.
Some of the biggest potential deductions are tied to his course in Doral, Florida, where he already claimed $323 million on 184 acres and could claim about $1.1 billion more. Forbes also estimates potential write-offs of roughly $1.1 billion at his club near Washington, D.C., and about $765 million in Rancho Palos Verdes, California.
According to the report, "It’s a staggering figure, especially since Trump, whose spokespeople did not respond to requests for comment, already pays minimal taxes. From 2017 to 2020, the president generated an estimated $555 million in operating income but sent just $3.1 million to the federal government. Trump, who once boasted that avoiding taxes 'makes me smart,' takes advantage of the standard real-estate deductions, such as depreciation and interest expenses. In especially lucrative years, however, he can turn to the golf-course trick."
The deductions can wipe out up to half of a donor’s annual tax bill, and unused amounts can be carried forward. They can’t be passed to heirs, however, which gives Trump a reason to use as much as possible while he’s alive, the report points out.
The IRS has been challenging deductions like these for about two decades. But Forbes noted that Trump recently struck a controversial and disputed immunity deal with the agency covering himself and two of his sons.
Even inside his company, the approach has skeptics. “Not everybody in the Trump Organization thinks this is a good idea,” Edward Russo, the environmentalist who first pitched the idea to Trump in 2005, admitted.