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Donald Trump stepped off the ultra-exclusive Forbes 400 list of America’s richest people for the first time since appearing in 1996, with a value of $ 400 million below this year’s threshold, revealed Tuesday. The media.
The former president is worth $ 2.5 billion, according to Forbes, after losing $ 600 million of his fortune during the COVID-19 pandemic.
Trump was ranked 339th last year. His highest position of all time was at No. 71 in 2003, the year before his hit NBC series, The Apprentice, launched.
But in March 2020, three years after Trump refused to divest his branded real estate assets, the coronavirus pandemic shook the economy.
Divesting when he took office in 2017 would have been an opportunity to diversify his assets, argues Forbes.
Even if he had divested and paid maximum capital gains tax, investing the rest in larger portfolios like the S&P 500 could have left him 80% richer than he is today.
Instead, its narrow wealth portfolio has been hit by the pandemic’s particularly powerful impact on tourism and hospitality, as well as real estate prices in major cities.
Donald Trump dropped from Forbes list of richest 400 Americans for the first time since 1996
Trump’s ranking had plummeted throughout his years in the White House and peaked in 2003
Reports that Trump was in talks to sell his hotel in Washington, DC emerged in early September.
The hotel was a popular spot during the Trump administration for fans of the ex-president, as well as diplomats and lobbyists who hoped to find favor.
But by the time Trump stepped down, the hotel posted 60% revenue and was left with an outstanding loan of $ 170 million, the Washington Post reported.
During the pandemic, its operations were significantly curtailed by DC’s restrictions on bars and restaurants. Hotels were open for people to stay, but at one point they were prohibited from hosting events and conferences.
“Since the coronavirus, we weren’t doing that bad until probably a month ago, I would say. It really slowed down, ”a hotel staff member told Insider in March.
Trump’s luxury apartments in New York and other urban centers have also fallen in value as parts of the city have seen rent prices drop.
After being hit hard by the coronavirus pandemic, former President Donald Trump is in advanced talks to sell the Trump International Hotel in Washington DC (photo from October 2016)
The Trump International Hotel Washington DC has a spacious lobby and bar, where the president’s allies are often seen hanging out
A June review by The Associated Press of more than 4,000 transactions over the past 15 years at 11 Trump-branded buildings in Chicago, Honolulu, Las Vegas and New York found that the prices of some condos and hotel rooms available for purchase fell by a third or more. .
It’s a dip that outpaces dips in many similar buildings, leaving units for sale in Trump buildings hundreds of thousands to a million dollars less than they would have been years ago.
“They’re giving them away,” says Lane Blue, who paid $ 160,500 in March for a studio in the Trump Tower in Las Vegas, $ 350,000 less than the seller paid in 2008.
The Trump World Tower in Manhattan has lost more than 20% of its value since Trump took office until he left
Its Manhattan buildings, like the Trump World Tower, have lost more than 20% of their value since Trump took office, Insider reported earlier this year.
The pandemic has also hit demand for commercial real estate – and the value of Trump’s stake in a 1290 Avenue of the Americas building in Manhattan has fallen from $ 80 million, to $ 685 million, according to a Bloomberg estimate. , who reviewed financial disclosures, real estate documents and loan documents.
In early 2017, Trump bragged about not having to part with his real estate fortune, despite criticism from ethics watchers and the presidential precedent.
While expected, the president is formally exempt from the criminal conflict of interest laws that apply to other federal employees.
“I could actually run my business and run the government at the same time,” he said at a press conference at Trump Tower. “I don’t like how it looks, but I would be able to do it if I wanted to. I would be the only one who could do it.
At the time, his assets had a net worth of around $ 3.5 billion.
Forbes noted on Tuesday that a large capital gains tax could have dissuaded Trump from parting with his real estate holdings.
The maximum federal capital gains tax is 23.8 percent. That of New York State is 8.8%.
Its five most valuable properties were acquired long enough ago, according to the report, that it was probably sitting on years of earnings.
If the maximum sanctions were applied, Trump would have lost about $ 1.1 billion in wealth, leaving $ 2.4 billion.
Trump missed Forbes threshold of $ 400 billion
However, if the rest had been reinvested in a portfolio of stocks tracking something more stable and diversified like the S&P 500 Index, Trump could have been worth $ 4.5 billion today.
But he could also have avoided a capital gains tax altogether.
A section of the federal tax code allows government employees who separate from their wealthy to apply for a certificate bypassing the penalty in an attempt to keep them away from potential conflicts of interest.
Although Trump is not subject to conflict of interest laws and therefore cannot claim the certificate, the former head of the Office of Government Ethics told Forbes he “would have been happy” if the president apply.
But no one from Trump’s transition team would have even asked.
“They never showed interest in the surrender,” said Walter Shaub.
Had he successfully applied for the certificate of surrender and reinvested his money in the same aforementioned fund, Trump would be worth $ 7 billion and rank 133rd on the Forbes 400 list.
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