A series of bombshell revelations today revealed embarrassing details about Donald Trump’s taxes that further damage the embattled former president.
Trump claimed for years that he couldn’t release his taxes because they were under audit, but the summary released by the House Ways and Means Committee shows that there was no such audit at the time.
Trump’s 2015-2020 tax filings also show that his sprawling business empire paid paltry taxes and reported tens of millions in negative income.
Released late on Tuesday by Democratic-led panel after years of legal battles which went all the way to the Supreme Court, the paperwork revealed that Trump’s income, and his supposed tax liability, dramatically changed during his four years in the White House.
The summary report is only a summary of the findings and Trump’s full returns will be released in the coming days.
A report also revealed the IRS had started an audit on just two years of Trump’s tax returns – despite having a longstanding policy of auditing presidents every year. That audit did not begin until April 2019, the same day the committee began poking around for Trump’s taxes, and it only covered his filings from 2015. Six months later in September the agency began probing the 2016 filings.
In 2015, Trump reported making more than $50 million through income in capital gains, interest, dividends and other earnings. But he reported some $85 million in losses, leaving him at a negative income of $31 million
U.S. House Ways and Means Committee staff members transport boxes of documents after a committee meeting to discuss former President Donald Trump’s tax returns on Capitol Hill in Washington, U.S., December 20
But Trump famously refused to turn over his tax returns in 2016 because he claimed to be under continuous audits (even if he was, it wouldn’t preclude him from releasing his tax returns by law).
In February 2016, he pledged to release his taxes during a debate.
‘I will absolutely give my return,’ Trump said, ‘but I’m being audited now for two or three years, so I can’t do it until the audit is finished, obviously.’
But those audits and the agency did not begin auditing his filings covering income he made during the presidency until after he left office.
Democrats release report on Trump’s taxes: the highlights
- 2015: Trump and Melania report negative income of $31 million with a taxable income of $0. Hit with alternative minimum tax of $641,931
- 2016: Negative income of $31.2 million, taxable income $0. Pay alternative minimum tax of $750
- 2017: Negative income $12.8 million, $0 taxable income. Pay alternative minimum tax of $750
- 2018: In the black – total income $24.4 million, taxable income $22.9 million. Pay $999,466 in federal income tax
- 2019: Total income $4.4 million, $2.97 in taxable income. Pay $133,445 in taxes
- 2020: Negative income $4.7 million, $0 in taxable income. Trumps claim a refund of $5.5 million
A Trump spokesman said the release of the documents was politically motivated.
‘If this injustice can happen to President Trump, it can happen to all Americans without cause,’ Trump Organization spokesman Steven Cheung said on Wednesday to Reuters.
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Democrats obtained Trump’s tax returns from 2015 to 2020 weeks ago by court order and voted to release the documents on Tuesday night, marking the pinnacle of a years-long back-and-forth as Trump sought to conceal the mysterious documents.
They asked the Joint Committee on Taxation (JCT), a nonpartisan office of tax lawyers and economists, to review the documents and released the JCT findings along with their own report on the IRS audit system.
The former president made tens of millions annually during that period, but was able to chip away at his tax bill by carrying over steep business losses from over the years.
Trump donated his salary as president, so all of his earnings were from other business ventures.
From 2015 to 2016, Trump carried over big losses from over the years to pay little relatively little in federal income tax.
In 2015, Trump reported making more than $50 million through income in capital gains, interest, dividends and other earnings. But he reported some $85 million in losses, leaving him at a negative income of $31 million.
He was hit with an alternative minimum tax that year – a tax code provision designed to prevent the wealthy from zeroing their tax bills – and had to pay $641,000.
Trump reported negative income for the next two years – paying only $750 in federal income tax in 2016 and 2017 – before his fortunes turned around in 2018.
Trump’s $22 million in capital gain in 2018 and $9 million in 2019 from asset sales gave him a sizable tax bill.
He reported nearly $24.3 million in adjusted gross income in 2018 and paid nearly a million in tax. The following year he was in the black as well, reporting $4.4 million in income and paying $133,445 in tax.
House Ways and Means Committee Chairman Rep. Richard Neal (D-MA) and Ranking Member Rep. Kevin Brady (R-TX) talk after the committee voted to submit their report, including the tax records
The JCT report also identifies different areas that the committee is looking to probe further, such as millions in charitable donations, loans to Trump’s children Ivanka, Don. Jr. and Eric that could be disguised taxable gifts and questionable business deductions.
The committee noted in one example from 2015, Trump was paid $50,000 for a speaking gig which was almost entirely offset by $46,162 in travel expenses.
‘Audits of closely-held entities often find personal expenditures being improperly deducted as travel expenses,’ the report said.
