Clarence Thomas’s $267,230 R.V. and the Friend Who Financed It

2023-08-05 - Scroll down for original article

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Vehicle loans are generally exempt from those reporting requirements, as long as they are secured by the vehicle and the loan amount doesn’t exceed its purchase price. But private loans like the one between Mr. Welters and Justice Thomas can be deemed gifts or income to the borrower under the federal tax code if they don’t hew to certain criteria: Essentially, experts said, the loan must have well-documented, commercially reasonable terms along the lines of what a bank would offer, and the borrower must adhere to those terms and pay back the principal and interest in full. Richard W. Painter, a White House ethics lawyer during the George W. Bush administration, said that when it comes to questions of disclosure, the ethics treatment of gifts and income often parallels the tax treatment. But those intricacies aside, he said, “justices just should not be accepting private loans from wealthy individuals outside their family.” If they do, he added, “you have to ask, why is a justice going to this private individual and not to a commercial lender, unless the justice is getting something he or she otherwise could not get.” The Times’s unearthing of the loan arrangement is the latest in a series of revelations showing how wealthy benefactors have bestowed an array of benefits on Justice Thomas and his wife, Virginia Thomas: helping to pay for his great-nephew’s tuition, steering business to Mrs. Thomas’s consulting firm, buying and renovating the house where his mother lives and inviting the Thomases on trips both domestic and foreign that included travel aboard private jets and a yacht. Justice Thomas has pointed to interpretations of the disclosure rules to defend his failure to report much of the largess he has received. He has said he was advised that the trips fell under an exemption for gifts involving “personal hospitality” from close friends, for instance, and a lawyer close to the Thomases contended in a statement that the justice did not need to disclose the tuition because it was a gift to his great-nephew, over whom he had legal custody, rather than to him. The Thomases’ known benefactors include wealthy men like the Dallas real estate developer Harlan Crow, the conservative judicial kingmaker Leonard Leo and several members of the Horatio Alger Association of Distinguished Americans, which honors people who succeed despite adversity. Among them: the longtime Miami Dolphins owner Wayne Huizenga, who flew the justice around on his jet.