Senate Democrats distribute memo claiming Bessent tax avoidance strategies
The memo highlighted millions of dollars in losses that Treasury Secretary nominee Scott Bessent attributed to his investment in a conservative publishing house, along with several other concerns.
TroibNews 
Senate Democrats are distributing a memo that alleges President-elect Donald Trump's nominee for Treasury secretary, Scott Bessent, improperly claimed nearly $2 million in tax losses and owes close to $1 million in taxes related to his hedge fund. This information provides a strategic advantage for Democrats as Bessent prepares to appear before the Finance Committee on Thursday.
The memo, acquired by PMG and crafted by Finance Committee staff under ranking member Ron Wyden, claims that Bessent should have paid $910,182 in taxes on income from his hedge fund, the Key Square Group, between 2021 and 2023. According to the memo, Bessent managed to avoid this tax liability by asserting that he was a “limited partner” without decision-making authority for Key Square.
Democratic staff on the Finance Committee contend that Bessent was indeed actively involved in making decisions for the fund.
Additionally, the memo addresses losses that Bessent reported from his income tied to All Seasons Press, a conservative book publishing company that has produced works by authors including former Trump aide Peter Navarro and a favorable biography of conservative commentator Tucker Carlson. The memo argues that Bessent failed to substantiate $1,939,296 in claimed losses, with ASP records showing he was not actively involved in the company's operations.
A spokesperson for the Trump transition labeled the allegations as "meritless," stating, "Scott Bessent has paid his taxes. After providing thousands of pages of records through an exhaustive process, neither Senator Wyden nor his staff are able to provide any evidence that Scott violated the Internal Revenue Code."
The spokesperson further remarked, "Instead, they have resorted to a subjective interpretation of the tax code, including taking positions that are contrary to the views of the broad majority of tax professionals, accountants and lawyers, in an effort to mislead the public."
The memo is expected to prompt numerous questions from Finance Committee Democrats regarding Bessent's tax situation during his nomination hearing. It also allows Wyden to frame Bessent as disconnected from the Treasury Department and IRS, which have been focused on addressing tax avoidance strategies employed by the ultra-wealthy under President Joe Biden’s administration.
However, this controversy is not likely to undermine Bessent's support from Republicans, who have united behind the experienced hedge fund manager. Senate Finance Chair Mike Crapo has already promised to expedite Bessent's nomination process.
Mandi Critchfield, a spokesperson for Crapo, responded to the memo by stating, "Mr. Bessent has followed the law and provided thousands of pages of documentation as part of the committee's rigorous vetting process."
Further concerns in the memo relate to a $500,000 deduction Bessent claimed for “bad debt” on his 2023 returns, suggesting that he did not provide sufficient justification to prove the deduction wasn’t actually a gift or personal loan.
Democratic staff also pointed out that Bessent likely utilized a workaround to bypass the $10,000 cap on state and local tax deductions, claiming $40,000 in deductions related to a cooperative investment.
In several instances, the memo indicates that Democratic staff urged Bessent to amend his tax returns, but he declined, noting that he would consider making changes if the relevant tax law disputes regarding his “limited partnership” status were addressed in higher courts.
Max Fischer contributed to this report for TROIB News
The memo, acquired by PMG and crafted by Finance Committee staff under ranking member Ron Wyden, claims that Bessent should have paid $910,182 in taxes on income from his hedge fund, the Key Square Group, between 2021 and 2023. According to the memo, Bessent managed to avoid this tax liability by asserting that he was a “limited partner” without decision-making authority for Key Square.
Democratic staff on the Finance Committee contend that Bessent was indeed actively involved in making decisions for the fund.
Additionally, the memo addresses losses that Bessent reported from his income tied to All Seasons Press, a conservative book publishing company that has produced works by authors including former Trump aide Peter Navarro and a favorable biography of conservative commentator Tucker Carlson. The memo argues that Bessent failed to substantiate $1,939,296 in claimed losses, with ASP records showing he was not actively involved in the company's operations.
A spokesperson for the Trump transition labeled the allegations as "meritless," stating, "Scott Bessent has paid his taxes. After providing thousands of pages of records through an exhaustive process, neither Senator Wyden nor his staff are able to provide any evidence that Scott violated the Internal Revenue Code."
The spokesperson further remarked, "Instead, they have resorted to a subjective interpretation of the tax code, including taking positions that are contrary to the views of the broad majority of tax professionals, accountants and lawyers, in an effort to mislead the public."
The memo is expected to prompt numerous questions from Finance Committee Democrats regarding Bessent's tax situation during his nomination hearing. It also allows Wyden to frame Bessent as disconnected from the Treasury Department and IRS, which have been focused on addressing tax avoidance strategies employed by the ultra-wealthy under President Joe Biden’s administration.
However, this controversy is not likely to undermine Bessent's support from Republicans, who have united behind the experienced hedge fund manager. Senate Finance Chair Mike Crapo has already promised to expedite Bessent's nomination process.
Mandi Critchfield, a spokesperson for Crapo, responded to the memo by stating, "Mr. Bessent has followed the law and provided thousands of pages of documentation as part of the committee's rigorous vetting process."
Further concerns in the memo relate to a $500,000 deduction Bessent claimed for “bad debt” on his 2023 returns, suggesting that he did not provide sufficient justification to prove the deduction wasn’t actually a gift or personal loan.
Democratic staff also pointed out that Bessent likely utilized a workaround to bypass the $10,000 cap on state and local tax deductions, claiming $40,000 in deductions related to a cooperative investment.
In several instances, the memo indicates that Democratic staff urged Bessent to amend his tax returns, but he declined, noting that he would consider making changes if the relevant tax law disputes regarding his “limited partnership” status were addressed in higher courts.
Max Fischer contributed to this report for TROIB News
