“It could be billions,” said David Herzig, a tax law professor at Valparaiso University. “People are saying, ‘Oh well, don’t worry,’ but you could be looking at the potential of billions of dollars in tax liability.”
Trump — who with his army of lawyers is examining his options ahead of a mid-December promised rollout of a plan to clarify the blurred lines between his business and political interests — could put off paying part of those taxes by taking advantage of a law permitting a tax-free trade to comply with federal conflict-of-interest rules, but there are legal questions about whether Trump is eligible for it.
To take advantage of the provision, he might have to sign an executive order qualifying himself—an action that would surely generate a barrage of criticism that he was giving himself a big tax break.
“I don’t think anyone had really thought through how you go from running an active real estate business to being president, without having any income, estate and gift tax problems,” Herzig said. “They say, ‘We’ll work it out,’ but saying you’ll work it out and figuring out how you’ll work it out are two different things….This is a huge problem to try to solve in just two or three weeks.”
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