Allen Weisselberg: Former Trump Org. The CFO declares that he did not pay taxes on $1.76 million in personal expenses



CNN

Former Trump Organization CEO Allen Weisselberg testified Tuesday that he knew he had to pay taxes on hundreds of thousands of dollars in annual benefits he received, including a Manhattan apartment paid for by the company, which he said former President Donald Trump suggested he go to.

Weisselberg testified for about 90 minutes at the Trump Organization’s criminal trial in Manhattan, calmly walking the jury through the company’s growth from 50 employees when it started there in 1986 to an umbrella organization that includes 500 entities.

Questioned by prosecutor Susan Hoffinger, Weisselberg answered “yes” as prosecutors went over the personal expenses he received from the Trump Org. – and that the company did not pay taxes from 2005 to 2017.

One of those tax-free benefits Weisselberg received was a 1,200-square-foot luxury apartment overlooking the Hudson River in Manhattan for more than $7,000 a month.

The former chief financial officer said Trump offered him the apartment in 2005 to cut down on his daily commute to Long Island, where he lived at the time. Weisselberg sat down with Trump, who Weisselberg said asked him if he would consider moving to the city. Trump said, according to Weisselberg, “it will help you, help the company” and that Weisselberg could work more hours.

Weisselberg said that after talking to his wife, they agreed to move in and Trump authorized the expense.

He also said he spent his utilities, phone, car rentals and garage, saying he was “part” with the apartment.

Either Weisselberg or Trump would sign the rent checks for his apartment. In total, he received $200,000 in tax-free compensation in one year from all of those benefits, according to his testimony.

Weisselberg testified that if he had asked for a raise, the company would have had to pay him double, $400,000, to cover the taxes.

In total, Weisselberg said he did not pay taxes on about $1.76 million in personal expenses from 2005 to 2017.

He admitted that he had underreported his income on his tax forms in order to get the benefits tax-free, and that he hid this information from Mazars accountants, he said, because he believed they would refuse to sign his return if they found out. .

Trump Organization controller Jeff McConney knew the practice was illegal when he created fake W-2 and 1099 tax forms on Weisselberg’s behalf, according to Weisselberg.

McConney previously said he didn’t believe all the expenses were mishandled until an internal review years later.

Weisselberg also acknowledged on Tuesday that he was stripped of his title of financial director after being arrested and charged with 15 counts of tax fraud and grand theft. Weisselberg, whose voice dropped to a whisper when discussing his crimes, said he continued to do the same job after being indicted. That changed in October, months after pleading guilty and agreeing to plead guilty, when Weisselberg said she began working from home and “stopped” with Eric Trump, who ran the company on a day-to-day basis.

Weisselberg said he is on paid leave and still expects to receive a $500,000 bonus in January on top of his $640,000 salary.

On the day Weisselberg settled with prosecutors in August, his son threw him a birthday party at Trump Tower. Weisselberg tried to play it down, saying that he regretted it, and that “it was a small cake”.

Weisselberg is expected to remain on the stand Thursday morning.

Two Trump Organization entities are facing charges of tax evasion, grand larceny and falsifying business records in what prosecutors allege was a 15-year scheme to defraud tax authorities by underreporting and paying taxes on workers’ compensation benefits. The former president is not a defendant in the case and is not expected to be implicated in any wrongdoing.