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Billionaire Seeks $5.7 Million Tax Refund for Epstein Islands
Developing
In Short: Billionaire Stephen Deckoff is suing the U.S. Virgin Islands for a tax refund, claiming an overpayment of $5.7 million.
The billionaire owner of two Caribbean islands, once owned by Jeffrey Epstein, has filed a lawsuit against the U.S. Virgin Islands, seeking a tax refund of more than $5.7 million. According to the complaint, Deckoff, through his investment firm SD Investments, is seeking to recover an alleged overpayment of income tax to the U.S. Virgin Islands Bureau of Internal Revenue (VIBIR) for the 2021 tax year.
After an examination, the Internal Revenue Service (IRS) asserted that Deckoff was not a "bona fide resident" of the Virgin Islands in the 2021 taxable year, therefore he "was not liable" for income tax to the Virgin Islands for income taxes with respect to non-Virgin Islands adjusted gross income. As a result, Deckoff filed a claim in November 2025, demanding a refund on income tax paid to the VIBIR with respect to non-Virgin Islands adjusted gross income in the amount of $5,757,038.
In a news release, Deckoff’s investment firm stated that a significant portion of the sale proceeds would go toward the government of the U.S. Virgin Islands as part of a previous deal with Epstein’s estate. Deckoff, the founder of Black Diamond Capital Management, purchased the islands in 2023, after Epstein's ownership. Authorities have said that Epstein abused young girls at his home on the island, and the president has denied any awareness of Epstein’s illegal activities.
The complaint, filed in the District Court of the Virgin Islands in July, says that the U.S. Virgin Islands is not commenting on the matter. Deckoff has expressed pride in calling the U.S. Virgin Islands home for more than a decade and is pleased to bring the area a world-class destination befitting its natural grace and beauty.
What's still developing
- Epstein, the late convicted sex offender, bought Little St. James in 1998 for a reported $8 million.
- Virgin Islands for comment via emails sent outside regular business hours.
Sources
- Newsweeklink