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IRS eyes partnerships in tax evasion crackdown on October 4, 2023 at 10:00 am Business News | The Hill

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Former President Trump isn’t the only one being accused of playing games with business valuations for financial gain.

The strategy of undervaluing and overvaluing business assets to keep money away from the IRS is increasingly a cause for concern for the agency.

Tax experts are preparing for a wave of intensified enforcement against large partnerships as the IRS gets ready to fight back.

Starting this month, hundreds of large partnerships will start getting special compliance notices from the IRS. The notice will alert them to discrepancies on their balance sheets that the IRS wants explained.

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These partnerships will include hedge funds, real estate investment partnerships, big law firms, and publicly traded partnerships, among other types of businesses. Many wealthy people prefer their businesses to be designated as partnerships so their business income can be reported directly on their personal tax returns.

IRS Commissioner Danny Werfel said some partnership tax returns “are showing discrepancies in the millions of dollars in their year-to-year balance sheets.”

“The number of such discrepancies has been increasing over the years. Many of these taxpayers are not attaching required statements explaining the difference,” Werfel said in a call with reporters last month.

Accountants say those discrepancies are often due to strategically inaccurate estimates of what businesses and their assets are actually worth. These inaccuracies help them to minimize tax liability.

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“What you’re seeing is some extraordinarily high valuations of these potential businesses with not a lot of oversight from analysts that are doing those valuations,” forensic accountant Dean Driskell of consulting firm J.S. Held told The Hill.

Personal business income

Partnerships are known as pass-through entities because they don’t file tax returns directly with the IRS. Instead, they pass their tax liability through to their individual owners.

This means partners in a company who report business losses or who significantly undervalue their businesses can use them to offset what they make in their regular salary.

“Let’s say you have a wealthy individual who may have a corporate job and makes a couple million dollars a year. If he or she is invested in a partnership and can show losses on those to offset the $2 million, they virtually have no tax liability,” Driskell said.

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Trump employed a similar strategy, distributing tens of millions of dollars’ worth of business and real estate losses throughout his tax returns, allowing him in some of the years he was president to pay nothing in tax.

The amount of personal business income owed to the government but not collected totaled $130 billion a year between 2014 and 2016, the last time it was definitively measured. It is almost certainly much higher now.

Money for nothing?

One well-known strategy that exploits overvalued businesses involves a tax deduction called a conservation easement, which is meant to encourage owners of large tracts of land not to develop them in the interest of the environment.

These deductions, when applied to partnerships that contain those overvalued businesses, can wipe out their tax liability.

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“Let’s say that we’re a family business that has three or four profitable businesses. They develop this conservation easement and get this very large tax credit, and it basically wipes out all of the tax liability for the other companies,” Driskell said.

“And now the IRS is becoming very interested to see how these valuations were done, whether the projects ever broke ground, et cetera.”

The IRS is aware of abuses concerning the conservation easement and shoddy valuations.

“We have seen taxpayers, often encouraged by promoters and armed with questionable appraisals, take inappropriately large deductions for easements,” the agency wrote in a statement earlier this year.

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But similar strategies making use of less well-known deductions are still likely taking place under the agency’s nose. They may also not even require specific deductions due to the “pass-through” nature of partnerships.

What’s the ‘basis’?

Tax lawyers also say the discrepancies the IRS is looking to resolve with big partnerships could lie in what companies tell themselves they’re worth and what they tell others they’re worth.

These differences in internal and external “basis” could be hiding big money.

“When you get into conversations about basis and income and loss, you’re going to get into conversations about valuation issues,” Robert Wall, a partner specializing in tax law at law firm Akerman, told The Hill in an interview. “What’s something actually worth and how do you substantiate that?”

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Howdy, partner

Another common tax dodge for partnerships that accountants say they frequently see has to do with partners’ contributing different amounts to their shared business ventures.

One partner can contribute the totality of the capital to a partnership while another legally designated partner contributes only their business acumen, an intangible skill or a set of connections.

Equity interest and the allocation of profits and losses can fall equally between the partners, even though only one of them has put up any money.

“The government says, ‘OK. You can be 50-50 partners, and you can be allocated, say, a $50,000 loss.’ But if [one partner] didn’t put in at least $50,000 into the business in cash, they’re not going to be able to take that loss at that time. They’re going to have to defer that loss either to when money is contributed or when there’s income from the business that will carry that loss forward to future years,” Mark Gottlieb, a forensic accountant and business valuation specialist in New York, told The Hill.

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Gottlieb, who testifies regularly in court about business valuations, said he sees issues arising from this kind of fiscally imbalanced partnership structure “every day.”

​Business, Domestic Taxes, Danny Werfel, IRS, irs funding, IRS funding boost, partnerships Former President Trump isn’t the only one being accused of playing games with business valuations for financial gain. The strategy of undervaluing and overvaluing business assets to keep money away from the IRS is increasingly a cause for concern for the agency. Tax experts are preparing for a wave of intensified enforcement against large partnerships…  

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How Epstein’s Cash Shaped Artists, Agencies, and Algorithms

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Jeffrey Epstein’s money did more than buy private jets and legal leverage. It flowed into the same ecosystem that decides which artists get pushed to the front, which research gets labeled “cutting edge,” and which stories about race and power are treated as respectable debate instead of hate speech. That doesn’t mean he sat in a control room programming playlists. It means his worldview seeped into institutions that already shape what we hear, see, and believe.

The Gatekeepers and Their Stains

The fallout around Casey Wasserman is a vivid example of how this works. Wasserman built a powerhouse talent and marketing agency that controls a major slice of sports, entertainment, and the global touring business. When the Epstein files revealed friendly, flirtatious exchanges between Wasserman and Ghislaine Maxwell, and documented his ties to Epstein’s circle, artists and staff began to question whose money and relationships were quietly underwriting their careers.

That doesn’t prove Epstein “created” any particular star. But it shows that a man deeply entangled with Epstein was sitting at a choke point: deciding which artists get representation, which tours get resources, which festivals and campaigns happen. In an industry built on access and favor, proximity to someone like Epstein is not just gossip; it signals which values are tolerated at the top.

When a gatekeeper with that history sits between artists and the public, “the industry” stops being an abstract machine and starts looking like a web of human choices — choices that, for years, were made in rooms where Epstein’s name wasn’t considered a disqualifier.

Funding Brains, Not Just Brands

Epstein’s interest in culture didn’t end with celebrity selfies. He was obsessed with the science of brains, intelligence, and behavior — and that’s where his money begins to overlap with how audiences are modeled and, eventually, how algorithms are trained.

He cultivated relationships with scientists at elite universities and funded research into genomics, cognition, and brain development. In one high‑profile case, a UCLA professor specializing in music and the brain corresponded with Epstein for years and accepted funding for an institute focused on how music affects neural circuits. On its face, that looks like straightforward philanthropy. Put it next to his email trail and a different pattern appears.

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Epstein’s correspondence shows him pushing eugenics and “race science” again and again — arguing that genetic differences explain test score gaps between Black and white people, promoting the idea of editing human beings under the euphemism of “genetic altruism,” and surrounding himself with thinkers who entertained those frames. One researcher in his orbit described Black children as biologically better suited to running and hunting than to abstract thinking.

So you have a financier who is:

  • Funding brain and behavior research.
  • Deeply invested in ranking human groups by intelligence.
  • Embedded in networks that shape both scientific agendas and cultural production.

None of that proves a specific piece of music research turned into a specific Spotify recommendation. But it does show how his ideology was given time, money, and legitimacy in the very spaces that define what counts as serious knowledge about human minds.

How Ideas Leak Into Algorithms

There is another layer that is easier to see: what enters the knowledge base that machines learn from.

Fringe researchers recently misused a large U.S. study of children’s genetics and brain development to publish papers claiming racial hierarchies in IQ and tying Black people’s economic outcomes to supposed genetic deficits. Those papers then showed up as sources in answers from large AI systems when users asked about race and intelligence. Even after mainstream scientists criticized the work, it had already entered both the academic record and the training data of systems that help generate and rank content.

Epstein did not write those specific papers, but he funded the kind of people and projects that keep race‑IQ discourse alive inside elite spaces. Once that thinking is in the mix, recommendation engines and search systems don’t have to be explicitly racist to reproduce it. They simply mirror what’s in their training data and what has been treated as “serious” research.

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Zoomed out, the pipeline looks less like a neat conspiracy and more like an ecosystem:

  • Wealthy men fund “edgy” work on genes, brains, and behavior.
  • Some of that work revives old racist ideas with new data and jargon.
  • Those studies get scraped, indexed, and sometimes amplified by AI systems.
  • The same platforms host and boost music, video, and news — making decisions shaped by engagement patterns built on biased narratives.

The algorithm deciding what you see next is standing downstream from all of this.

The Celebrity as Smoke Screen

Epstein’s contact lists are full of directors, actors, musicians, authors, and public intellectuals. Many now insist they had no idea what he was doing. Some probably didn’t; others clearly chose not to ask. From Epstein’s perspective, the value of those relationships is obvious.

Being seen in orbit around beloved artists and cultural figures created a reputational firewall. If the public repeatedly saw him photographed with geniuses, Oscar winners, and hit‑makers, their brains filed him under “eccentric patron” rather than “dangerous predator.”

That softens the landing for his ideas, too. Race science sounds less toxic when it’s discussed over dinner at a university‑backed salon or exchanged in emails with a famous thinker.

The more oxygen is spent on the celebrity angle — who flew on which plane, who sat at which dinner — the less attention is left for what may matter more in the long run: the way his money and ideology were welcomed by institutions that shape culture and knowledge.

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Ghislaine Maxwell seen alongside Jeffrey Epstein in newly-released Epstein files from the DOJ. (DOJ)

What to Love, Who to Fear

The point is not to claim that Jeffrey Epstein was secretly programming your TikTok feed or hand‑picking your favorite rapper. The deeper question is what happens when a man with his worldview is allowed to invest in the people and institutions that decide:

  • Which artists are “marketable.”
  • Which scientific questions are “important.”
  • Which studies are “serious” enough to train our machines on.
  • Which faces and stories are framed as aspirational — and which as dangerous.

If your media diet feels saturated with certain kinds of Black representation — hyper‑visible in music and sports, under‑represented in positions of uncontested authority — while “objective” science quietly debates Black intelligence, that’s not random drift. It’s the outcome of centuries of narrative work that men like Epstein bought into and helped sustain.

No one can draw a straight, provable line from his bank account to a specific song or recommendation. But the lines he did draw — to elite agencies, to brain and music research, to race‑obsessed science networks — are enough to show this: his money was not only paying for crimes in private. It was also buying him a seat at the tables where culture and knowledge are made, where the stories about who to love and who to fear get quietly agreed upon.

Bill Clinton and English musician Mick Jagger in newly-released Epstein files from the DOJ. (DOJ)

A Challenge to Filmmakers and Creatives

For anyone making culture inside this system, that’s the uncomfortable part: this isn’t just a story about “them.” It’s also a story about you.

Filmmakers, showrunners, musicians, actors, and writers all sit at points where money, narrative, and visibility intersect. You rarely control where the capital ultimately comes from, but you do control what you validate, what you reproduce, and what you challenge.

Questions worth carrying into every room:

  • Whose gaze are you serving when you pitch, cast, and cut?
  • Which Black characters are being centered — and are they full humans or familiar stereotypes made safe for gatekeepers?
  • When someone says a project is “too political,” “too niche,” or “bad for the algorithm,” whose comfort is really being protected?
  • Are you treating “the industry” as a neutral force, or as a set of human choices you can push against?

If wealth like Epstein’s can quietly seep into agencies, labs, and institutions that decide what gets made and amplified, then the stories you choose to tell — and refuse to tell — become one of the few levers of resistance inside that machine. You may not control every funding source, but you can decide whether your work reinforces a world where Black people are data points and aesthetics, or one where they are subjects, authors, and owners.

The industry will always have its “gatekeepers.” The open question is whether creatives accept that role as fixed, or start behaving like counter‑programmers: naming the patterns, refusing easy archetypes, and building alternative pathways, platforms, and partnerships wherever possible. In a landscape where money has long been used to decide what to love and who to fear, your choices about whose stories get light are not just artistic decisions. They are acts of power.

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New DOJ Files Reveal Naomi Campbell’s Deep Ties to Jeffrey Epstein

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In early 2026, the global conversation surrounding the “Epstein files” has reached a fever pitch as the Department of Justice continues to un-redact millions of pages of internal records. Among the most explosive revelations are detailed email exchanges between Ghislaine Maxwell and Jeffrey Epstein that directly name supermodel Naomi Campbell. While Campbell has long maintained she was a peripheral figure in Epstein’s world, the latest documents—including an explicit message where Maxwell allegedly offered “two playmates” for the model—have forced a national re-evaluation of her proximity to the criminal enterprise.

The Logistics of a High-Fashion Connection

The declassified files provide a rare look into the operational relationship between the supermodel and the financier. Flight logs and internal staff emails from as late as 2016 show that Campbell’s travel was frequently subsidized by Epstein’s private fleet. In one exchange, Epstein’s assistants discussed the urgency of her travel requests, noting she had “no backup plan” and was reliant on his jet to reach international events.

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This level of logistical coordination suggests a relationship built on significant mutual favors, contrasting with Campbell’s previous descriptions of him as just another face in the crowd.

In Her Own Words: The “Sickened” Response

Campbell has not remained silent as these files have surfaced, though her defense has been consistent for years. In a widely cited 2019 video response that has been recirculated amid the 2026 leaks, she stated, “What he’s done is indefensible. I’m as sickened as everyone else is by it.” When confronted with photos of herself at parties alongside Epstein and Maxwell, she has argued against the concept of “guilt by association,” telling the press:

“I’ve always said that I knew him, as I knew many other people… I was introduced to him on my 31st birthday by my ex-boyfriend. He was always at the Victoria’s Secret shows.”

She has further emphasized her stance by aligning herself with those Epstein harmed, stating,

“I stand with the victims. I’m not a person who wants to see anyone abused, and I never have been.””

The Mystery of the “Two Playmates”

The most damaging piece of evidence in the recent 2026 release is an email where Maxwell reportedly tells Epstein she has “two playmates” ready for Campbell.

While the context of this “offer” remains a subject of intense debate—with some investigators suggesting it refers to the procurement of young women for social or sexual purposes—Campbell’s legal team has historically dismissed such claims as speculative. However, for a public already wary of elite power brokers, the specific wording used in these private DOJ records has created a “stop-the-scroll” moment that is proving difficult for the fashion icon to move past.

A Reputation at a Crossroads

As a trailblazer in the fashion industry, Campbell is now navigating a period where her professional achievements are being weighed against her presence in some of history’s most notorious social circles. The 2026 files don’t just name her; they place her within a broader system where modeling agents and scouts allegedly groomed young women under the guise of high-fashion opportunities. Whether these records prove a deeper complicity or simply illustrate the unavoidable overlap of the 1% remains the central question of the ongoing DOJ investigation.

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Google Accused Of Favoring White, Asian Staff As It Reaches $28 Million Deal That Excludes Black Workers

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Google has tentatively agreed to a $28 million settlement in a California class‑action lawsuit alleging that white and Asian employees were routinely paid more and placed on faster career tracks than colleagues from other racial and ethnic backgrounds.

How The Discrimination Claims Emerged

The lawsuit was brought by former Google employee Ana Cantu, who identifies as Mexican and racially Indigenous and worked in people operations and cloud departments for about seven years. Cantu alleges that despite strong performance, she remained stuck at the same level while white and Asian colleagues doing similar work received higher pay, higher “levels,” and more frequent promotions.

Cantu’s complaint claims that Latino, Indigenous, Native American, Native Hawaiian, Pacific Islander, and Alaska Native employees were systematically underpaid compared with white and Asian coworkers performing substantially similar roles. The suit also says employees who raised concerns about pay and leveling saw raises and promotions withheld, reinforcing what plaintiffs describe as a two‑tiered system inside the company.

Why Black Employees Were Left Out

Cantu’s legal team ultimately agreed to narrow the class to employees whose race and ethnicity were “most closely aligned” with hers, a condition that cleared the path to the current settlement.

The judge noted that Black employees were explicitly excluded from the settlement class after negotiations, meaning they will not share in the $28 million payout even though they were named in earlier versions of the case. Separate litigation on behalf of Black Google employees alleging racial bias in pay and promotions remains pending, leaving their claims to be resolved in a different forum.

What The Settlement Provides

Of the $28 million total, about $20.4 million is expected to be distributed to eligible class members after legal fees and penalties are deducted. Eligible workers include those in California who self‑identified as Hispanic, Latinx, Indigenous, Native American, American Indian, Native Hawaiian, Pacific Islander, and/or Alaska Native during the covered period.

Beyond cash payments, Google has also agreed to take steps aimed at addressing the alleged disparities, including reviewing pay and leveling practices for racial and ethnic gaps. The settlement still needs final court approval at a hearing scheduled for later this year, and affected employees will have a chance to opt out or object before any money is distributed.

H2: Google’s Response And The Broader Stakes

A Google spokesperson has said the company disputes the allegations but chose to settle in order to move forward, while reiterating its public commitment to fair pay, hiring, and advancement for all employees. The company has emphasized ongoing internal audits and equity initiatives, though plaintiffs argue those efforts did not prevent or correct the disparities outlined in the lawsuit.

For many observers, the exclusion of Black workers from the settlement highlights the legal and strategic complexities of class‑action discrimination cases, especially in large, diverse workplaces. The outcome of the remaining lawsuit brought on behalf of Black employees, alongside this $28 million deal, will help define how one of the world’s most powerful tech companies is held accountable for alleged racial inequities in pay and promotion.

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