Donald Trump has boasted that he hates taxes and strives to avoid them whenever possible.ROBYN BECK/AFP / Getty Images
Real-estate mogul Donald Trump signed a letter saying he had no objections to a deal allegedly structured to evade paying tens of millions of dollars in U.S. taxes, according to a report from The Daily Telegraph.
Mr. Trump, the presumptive Republican nominee for president, has boasted that he hates taxes and strives to avoid them whenever possible. He has also refused to release his tax returns, unlike every presidential candidate in recent memory.
The Telegraph's report concerns a deal in 2007 between Bayrock Group LLC, a small real-estate developer, and FL Group, an institutional investor in Iceland. Bayrock had partnered with Mr. Trump's organization to build Trump SoHo, originally envisioned as a combination condominium-hotel in downtown New York.
The report quotes e-mails and documents to claim that Bayrock first described the investment from FL as a sale, then later restructured it as a loan in order to avoid a huge tax bill.
Mr. Trump signed papers acknowledging the first iteration of the deal – a sale – in April, 2007. About three weeks later, he signed a letter acknowledging "without objection" the second version of the transaction, then structured as a loan.
Alan Garten, Mr. Trump's lawyer, told the paper that Mr. Trump had "nothing to do with the transaction" and had merely acknowledged the matter. "He was not signing off on the deal," said Mr. Garten.
The paper reported that Mr. Trump could be deposed if the U.S. Internal Revenue Service decided to audit the deal. However, experts consulted by the paper believed that Bayrock, not Mr. Trump, would be liable for any tax owing, the paper said.
Angela Pruitt, a spokeswoman for Bayrock, said in a statement that the IRS had audited the tax treatment of the FL loan and concluded it was "entirely appropriate."
Felix Sater, a former Bayrock associate, is a memorable figure among Mr. Trump's previous business partners. Mr. Sater spent time in prison after stabbing a man in the face with the stem of a cocktail glass during a bar fight. Later, he became a confidential informant in a federal investigation into a massive stock fraud scheme linked to the Mafia, The New York Times reported in April.
Although Mr. Sater once had a business card claiming to be a senior adviser to Mr. Trump, the real-estate mogul has claimed they were never close.