Tax issue re. Donald Trump, Michael Cohen, and Stormy Daniels

A reporter on the national beat recently asked me whether Trump might be guilty of tax fraud if he deducted the payments of $35,000 per month that he was making, for some period, to reimburse Michael Cohen, for paying $130,000 in hush money to Stormy Daniels. The payments reportedly included a gross-up for the income tax consequences to Cohen, under the assumption that he would include them without deducting the hush money payment.This would have been a great question for my Federal Income Tax exam, if only (1) I had heard it in time, and (2) it weren’t too politically sensitive to be a proper exam question. (E.g., one doesn't want students' answers to be influenced by their own political views, or their perceptions as to mine.)Anyway, here’s a lightly edited & expanded version of my response:That's an interesting question. The key tax issue is, what would have been Trump’s legitimate business reason for deducting the payments to Cohen?…

Read more detail on Recent Tax Law posts –

This entry was posted in Tax Law and tagged , , , , , , . Bookmark the permalink.

Leave a Reply