Combing through Trump's tax returns

Former President Trump’s seven-year battle to keep the public from seeing his taxes ended in defeat Friday as [the House Ways and Means Committee] released six years of returns documenting his aggressive efforts to minimize what he paid the Internal Revenue Service.

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The new disclosures do not fundamentally change what was already known about Trump’s finances — that he’s relied heavily on inherited wealth to offset a string of businesses that consistently lose money, that he’s used those losses to wipe out most of his tax liability for years, that many of his claims have stretched the law and perhaps broken it.

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Trump and his wife, Melania, paid $750 or less in federal income tax in 2016 and 2017. The couple paid zero taxes in 2020 and claimed a $5.5-million refund.

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In three other years, Trump paid significant amounts. As a share of his income, however, his payments were far below those of the average taxpayer.

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The 2018 payment came on reported adjusted gross income of $24.3 million — an effective tax rate of 4%. By contrast, the average taxpayer in 2018 paid $15,322 in federal income taxes, with an average rate of about 13%, according to the IRS.

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Trump’s golf courses in the U.S. and Scotland have been consistent money losers, the returns show. His hotel properties, by contrast, were very profitable in 2017, the first year of his presidency, but experienced large losses in 2020, thanks at least in part to the COVID-19 pandemic, which devastated the hospitality industry.

One major offset to those losses involved foreign income. In 2017, Trump’s gross income from foreign sources totaled $55.4 million. That included $6.5 million from business in China, where he made a state visit that year. He had reported no income from China in 2016. The 2017 return also shows $5.7 million in income from India. Most of the rest of the foreign income that year came from Canada.

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“His tax returns seem to confirm that he did in fact earn millions from countries about which he had to regularly make important decisions as president.”

The returns do not disclose any obviously nefarious sources of income — contrary to speculation over the years by some of Trump’s opponents.

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In 2017, the year Trump paid a net tax of $750, his return shows he took $7.4 million in tax credits, which completely erased what he otherwise would have owed. Some of those tax credits were apparently for renovating the Trump International Hotel in Washington, which he sold after leaving office. Tax law provides for credit for investments in historic properties and for certain poor communities, but the IRS has not yet determined whether Trump’s claims were valid.

The tax returns show a number of other cases, small and large, that were flagged by congressional staff. In one schedule for the 2015 tax year, Trump reported a $50,000 speaking fee that was almost entirely offset by $46,162 in claimed travel expenses.

Repeatedly, Trump’s returns show businesses where the reported income precisely matches reported expenses.

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[I]n 2020, Trump appears to have broken his pledge to donate his $400,000 annual presidential salary to charity.

  LA Times

What a fucking surprise.

[H]is 2020 return shows zero charitable contributions. His 2018 and 2019 returns reported charitable contributions of just over $500,000. In 2017, he reported giving $1.9 million to charity. In a report on Trump’s taxes, the committee noted that Trump provided little documentation to back up those claimed contributions, a red flag.

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Since 1977, the IRS has had a stated policy of mandatory audits of the tax returns of presidents and vice presidents. But in obtaining Trump’s returns, House Democrats discovered that during the first two years of Trump’s term, the IRS had not audited the president.

And we found out why.

Trump’s returns remain under audit, and the IRS has not resolved some questions that pre-date his presidency. If the agency rules against Trump, he could face millions of dollars in additional tax liability.

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During the years in which Trump battled disclosure, much of the information he sought to keep secret about his pre-presidential finances became public anyway, largely from a 2020 New York Times investigation.

The picture that emerged showed that for all Trump’s claims to be a great businessman, his core enterprises — a sprawling network of hotels, golf courses and other properties — have lost millions of dollars year after year.

“He’s a staggering loser,” said Steven M. Rosenthal, a senior fellow in the Urban-Brookings Tax Policy Center, a think tank.

Amen to that. 

The former president was known for fusing his business interests with America’s highest public office, drawing allegations of using his role to promote his private resorts, direct federal money to his hotels and encourage foreign governments to spend money that would directly benefit the Trump family interests.

His far-flung concerns, foreign and domestic, are nested in more than 400 separate business entities. A 2019 report by the watchdog group OpenSecrets said he had more than $130 million in assets in more than 30 countries.

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It’s not a surprise that Trump continued to receive money from foreign interests while he was president. While he handed over day-to-day operation of his business empire to his children, he still kept ownership.

Trump’s sons, Donald Jr. and Eric, made deals around the globe while their father was president.

  Politico

UPDATE:

Mr. Trump’s history of inheriting wealth and then losing it was chronicled by The New York Times in 2020, when it obtained decades of Mr. Trump’s tax information, including much of which was disclosed on Friday.

  MaddowBlog

UPDATE: Let's look back...