Trump’s tax returns released, launching fresh scrutiny of his finances
House Democrats released several years’ worth of former President Donald Trump’s tax returns on Friday, launching what is sure to be another round of intense scrutiny of his finances.
The drop marks an extraordinary step by the House’s top tax writer, Ways and Means Chair Richard Neal (D-Mass.), who had been engaged in a 3½-year legal battle over the release of Trump’s taxes until the Supreme Court ruled in his favor in November. It also adds to the growing list of political and legal challenges for Trump as he mounts his 2024 campaign for president.
The six years of joint tax returns filed by Trump and his wife, Melania, — from 2015 to 2020 — number a little over 2,700 pages. They report income from a wide range of golf, restaurant and ice-skating businesses, as well as speaking engagements.
The forms also show income Trump generated in a range of foreign countries including Canada, China, Turkey, the Philippines, the United Arab Emirates, and the Caribbean island of Saint Martin, among others.
Income from Canada, Ireland and the United Kingdom figure prominently in gross amounts reported. Trump also reported numerous streams of income from Panama.
Trump’s income swung wildly over the years, according to the returns, ranging from a deficit of $32.4 million in 2016 to a high of $24.4 million in 2018. He paid roughly $1 million in taxes in 2018, but nothing in 2020 after reporting negative income of $4.8 million. He paid $641,931 in 2015, $750 in both 2016 and 2017, and $133,445 in 2019.
His real estate empire and other businesses reported significant losses over the six years, some of which reflected losses in prior years that were carried forward.
Trump reported giving gifts to charity for tax years 2015 through 2019, including $1.2 million in 2016, $1.9 million in 2017 and two gifts of around half a million in 2018 and 2019.
In his last year as president, Trump reported making no charitable contributions, despite a promise he made while campaigning to give away his annual presidential salary of $400,000.
Another notable item in the returns are interest payments made to Trump from his children: From 2017 through 2020, Ivanka and Donald Trump Jr. paid their father $18,000 and $8,715, respectively, in interest each year. Eric Trump paid $24,000 each year to his father from 2017 through 2019, but that figure dropped to $19,605 in 2020.
That could be a sign Trump could be trying to skirt a stiff 40 percent tax on gifts to his children by classifying them as loans instead. Though not necessary illegal, the technique would need to adhere to strict IRS rules and requires documentation of letters sent to Trump’s children stating that the former president is forgiving the loans’ principal.
Democrats say their investigation of Trump’s taxes and a mandatory presidential audit program will transform accountability for the most powerful person in the country. Neal sued the Treasury Department in 2019 to obtain the returns under a law that allows the heads of Congress’ tax committees to access anyone’s tax information, after Trump broke decades of tradition by refusing to voluntarily release them as other presidential candidates and sitting presidents have.
“A president is no ordinary taxpayer,” Neal said in a statement accompanying the release. “They hold power and influence unlike any other American. And with great power comes even greater responsibility.”
Republicans denounced the move as a political hit job that will open a Pandora’s box.
“The great USA divide will now grow far worse,” Trump said in an email blast. “The Radical Left Democrats have weaponized everything, but remember, that is a dangerous two-way street!”
Six years of Trump’s returns will now be available to tax experts and non-experts, a development that Trump’s former fixer Michael Cohen said the former president feared would result in the government levying additional taxes and penalties.
A preliminary analysis of Trump’s taxes by Congress’ brain trust on tax issues, the Joint Committee on Taxation, found that the former president paid little to no taxes for several years by claiming mammoth business losses.
Among the items outlined by JCT are several red flags that could change the amount of taxes Trump ends up owing once the IRS completes ongoing audits.
Despite the release of the returns, significant questions may still go unanswered, Steve Rosenthal of the nonpartisan Tax Policy Center said.
Huge losses that Trump claimed to lower his taxes seemingly originate in earlier tax years and still have not been cleared by the IRS, making it difficult to assess their legitimacy, Rosenthal said.
Trump carried forward $105 million in losses to 2015 and brought $73 million in losses to 2016, but those likely stem from the stunning $700 million loss that The New York Times has reported Trump claimed on his 2009 return, among other potential losses, Rosenthal said.
The “elephant in the room” is those earlier returns that were not ultimately subject to the Ways and Means scrutiny.
“That’s critical, but the committee failed to ask for it,” Rosenthal said.
Trump claimed his returns reflect the actions of a shrewd businessman.
“The ‘Trump’ tax returns once again show how proudly successful I have been and how I have been able to use depreciation and various other tax deductions as an incentive for creating thousands of jobs and magnificent structures and enterprises,” he said in his email.
According to a Ways and Means report released last week, the IRS was severely outgunned in its efforts to audit Trump, whose returns weren’t audited during his first two years in office despite an IRS policy of examining the taxes of sitting presidents.
A single agent at the IRS was responsible for examining Trump’s voluminous returns and was pitted against partners at a global law firm and a former IRS chief counsel. Trump’s representatives protested when it was suggested that the IRS bring in two more auditors to help handle the sizable paperwork.
Republicans, who will take over the House on Jan. 3, say the decision to release Trump’s taxes will open a new front in political warfare in which no one’s tax information — from that of Supreme Court justices to business and union leaders — will be immune from disclosure.
Rep. Kevin Brady, the top Republican on Ways and Means, said, “Democrats have charged forward with an unprecedented decision to unleash a dangerous new political weapon that reaches far beyond the former president, overturning decades of privacy protections for average Americans that have existed since Watergate.”
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