The Trump administration has been giving additional massive tax breaks to uber-wealthy corporations through under-the-radar notices, according to a report.
Through proposed regulations, the Treasury Department has offered tax relief to private equity firms, crypto companies, foreign real estate investors, and other large corporations, the New York Times first reported.
For example, in October, the IRS issued new proposed regulations that would provide breaks to foreign investors in U.S. real estate. In August, the IRS proposed a rollback of rules to prevent multinational corporations from dodging taxes by claiming duplicate losses in multiple countries.
The notices have not made headlines, but have been flagged by accounting and consulting firms.
“Treasury has clearly been enacting unlegislated tax cuts,” Kyle Pomerleau, a senior fellow at the think-tank American Enterprise Institute, told the Times. “Congress determines tax law. Treasury undermines this constitutional principle when it asserts more authority over the structure of the tax code than Congress provides it.”
The recent IRS tax notices tack on to the tax relief laid out in President Donald Trump’s “One Big Beautiful Bill” Act, which included the extension of the so-called “Trump tax cuts” from 2017 that the Congressional Budget Office estimated would reduce tax revenue by $4 trillion in the next decade.
The Independent has contacted the Treasury Department for comment.
Trump’s “One Big Beautiful Bill” provides more than $1.5 trillion in tax cuts for the top 5 percent of Americans, the Center for American Progress found.
The proposals target former President Joe Biden’s 2022 Inflation Reduction Act, which ensured profitable corporations paid a minimum tax to combat inflation and reduce the federal deficit. That law generally required corporations with more than $1 billion in annual revenue to pay 15 percent of the adjusted financial statement income.
A 2022 study suggested that only about 80 corporations would be subjected to this requirement. The Joint Committee on Taxation estimated that the act would bring in $200 billion in revenue over the course of a decade.
In September, the IRS released notices regarding the 2002 minimum tax, issuing interim guidance that allows corporations to “disregard gains and losses that are unrealized for regular tax purposes” on its holdings of digital assets when calculating its adjusted financial statement income.
Strategy Inc, a crypto firm, announced it “no longer expects to become subject to” the minimum tax in light of the interim guidance, the company said in a SEC filing. Also citing the September guidance, natural gas exporter Cheniere Energy announced last month it was entitled to a refund of the previously paid minimum tax; the refund is worth $380 million, the Times reported.
A Treasury Department spokesperson told the Times the proposed regulations were “a practical approach that supports American investment and competitiveness” and were meant to replace the Biden administration’s “compliance maze that would have buried taxpayers in red tape.”
However, some experts have expressed concerns that the Treasury’s proposals could be contributing billions to the federal deficit — and could be exceeding its authority, as Congress is responsible for enacting federal tax laws.
Proposing regulations through the Treasury rather than passing laws through Congress means “you can just give away the goodies to one group, without having to take back anything from another,” Daniel Hemel, a law professor at New York University, told the paper. It’s a route that “that previous administrations have exploited and which the Trump administration is exploiting more aggressively,” Hemel said.
Trump has recently leaned on his wealthy allies to fund a $300 million ballroom in the White House. Tech giants Amazon, Apple, Google, HP and Microsoft are among the corporations and donors chipping in to the project.
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