Trump’s reputation as a successful entrepreneur is damaged by his tax returns.

tax returns

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The joint tax returns for former President Donald Trump and his wife Melania for the previous six years were made public on Friday by the House Ways and Means Committee. The documents reveal information that was previously unknown, including loans he gave to his kids, earnings from book royalties and Melania’s modeling work, and the percentage of his presidential salary that was donated to charitable causes.

Trump fought for years to have his returns withheld from the public, but in November the Supreme Court decided not to intervene and allow them to be given to the Democratic-led committee. In 2019, when Democrats took over control of Congress, the House Ways and Means Committee started the battle to collect his taxes.

Personal information was redacted from the returns, which cover the years 2015 to 2020. Given Trump’s experience in business, particularly the real estate sector, the returns are intricate and demand careful reading. According to forensic accountant Bruce Dubinsky, they all seem to reflect very significant pass-through losses from more than 100 business entities.

On Friday, Trump claimed that Democrats had “unconstitutionally released” his tax returns.

Richard Nixon, he is the first president to have kept his tax returns a secret. Recent presidents voluntarily released their tax returns. The IRS did not audit Trump for the first two years he was in office until the committee inquired about it, according to a report last week from the House Ways and Means Committee. The Democratic-led House of Representatives passed a bill last week to strengthen the IRS mandatory presidential audit program before Republicans took over control of Congress in January.

Trumps Tax Returns

tax returns

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The House Ways and Means Committee made former president Donald J. Trump’s private tax records public, and they reveal significant losses from his own businesses while he continued to profit from inherited assets. Friday saw the release by House Democrats of six years’ worth of Donald J. Trump’s tax returns, providing fresh information about his business dealings and further undermining his long-cultivated reputation as a wildly successful businessman.

Thousands of pages of tax records, including individual returns for Mr. Trump and his wife, Melania, as well as business returns for a number of the numerous hundred companies that make up his vast business empire, were made public on Friday morning. It came after Democratic members of the Ways and Means Committee published reports revealing that Mr. Trump had paid federal income taxes totaling $1.1 million in the first three years of his presidency, but had paid none in 2020 as his income declined and his losses increased.

The document release drew criticism and threats of retaliation from Mr. Trump and his Republican allies in Congress, who suggested that once their party takes control of the House on January 3, they may try to reveal tax returns filed by Democratic politicians, Supreme Court justices, and family members of President Biden, like his son Hunter.

When Mr. Trump reported no charitable giving of any kind, the documents seemed to indicate that he had broken his campaign promise to donate his salary as president, at least for the year 2020. Additionally, they hypothesized that Mr. Trump’s tax bill may have increased as a result of a modification to his landmark 2017 tax reform: a restriction on the deduction of state and local taxes paid.

Trump attacked Democrats and claimed that the decision to make the returns public had been “weaponized” in a statement on Friday.

The author wrote, “The ‘Trump’ tax returns once again show how proudly successful I have been and how I was able to use depreciation and various other tax deductions as a catalyst for creating thousands of jobs and magnificent structures and enterprises.”

But according to the returns, which cover the tax years 2015 through 2020, Mr. Trump’s most recent business dealings have not been very successful. They reveal that despite continuing to profit from assets he inherited, Mr. Trump frequently disclosed significant losses from his own business ventures. The New York Times chronicled Mr. Trump’s history of inheriting wealth and then losing it in 2020 after obtaining decades’ worth of his tax records, including a significant amount of what was made public on Friday.

According to tax returns examined by The Times, the former president did not declare any taxable income for a decade before declaring more than $24 million in taxable income in 2018. Nearly all of the federal taxes he paid as president—close to $1 million—were paid by him. That income appeared to be the result of gains of over $14 million from the sale of an investment his father made in the 1970s, a Brooklyn apartment building called Starrett City, which later became a part of Mr. Trump’s inheritance.

A large portion of the information the committee made public on Friday was also disclosed in a top-line report that the committee released last week. However, the tens of thousands of pages of tax records revealed fresh information about the president’s earnings and spending.

The records reveal, for instance, that, contrary to what The Times previously stated, his inheritance had a greater impact in 2018: Gains from the sale of commercial properties that Mr. Trump and his siblings had inherited or acquired through trusts, including the sale of Starrett City, totaled $25.7 million.

The tax itemization reveals that the sales of Mr. Trump’s self-owned commercial properties were unsuccessful, which reduced his net proceeds and somewhat decreased his tax liability. Two of his business entities sold a total of $1 million worth of assets or equipment at a loss, and he also incurred a further $1 million loss by rescuing his son Donald Trump Jr. from a failing venture to construct prefabricated homes.

His tax returns reveal that Mr. Trump also received tens of thousands of dollars in dividends from trusts that had been set up for him when he was young while he was in the White House. One of the most privately held pieces of information in the US is tax returns. Even though Congress has the authority to acquire and release them, it rarely does so.

Democratic lawmakers requested Mr. Trump’s tax returns after he deviated from the convention and refused to release them because they might have revealed potential conflicts of interest. They eventually succeeded in releasing them by using their oversight authority to look into the Internal Revenue Service’s practice of auditing presidents and vice presidents.

After years of court battles and rumors regarding Mr. Trump’s wealth and financial connections, the final disclosure finally happened.

Democrats argued that the disclosure was a necessary check on a president who defied decades of tradition by withholding his tax returns. Donald S. Beyer Jr., a Democrat from Virginia and member of the Ways and Means Committee, stated in a news release on Friday that “Trump acted as though he had something to hide, a pattern consistent with the recent conviction of his family business for criminal tax fraud.” As the public can now see, Trump used a number of other tax avoidance techniques, including dubious or inadequately supported deductions, to justify paying little to no federal income tax in several of the years examined”.

Republicans, however, cautioned Democrats that they had created a risky precedent. On Friday, the Republicans released a report of their own that contained extensive criticisms of the procedure used to make the documents public.

Representative Kevin Brady of Texas, the top Republican on the Ways and Means Committee, said in a statement prior to the report that future chairs of both the House Ways and Means Committee and the Senate Finance Committee will have nearly unrestricted authority to target and make public the tax returns of private individuals, political rivals, business and labor leaders, or even the Supreme Court justices themselves.

The prospect of reprisals was also mentioned by Mr. Trump.

He stated in his Friday news release that “the Democrats should have never done it, the Supreme Court should have never approved it, and it’s going to lead to horrible things for so many people.” “The great American divide is about to get much worse. Everything has been weaponized by the Radical Left Democrats, but keep in mind that this is a dangerous two-way street!

When running for president in 2015, Mr. Trump pledged that he would not accept “even one dollar” of the position’s $400,000 salary. If I’m elected president, I’m totally giving up my salary, he declared.

Mr. Trump claimed that during his first three years in office, he gave away a quarter of his salary. However, in 2020, as the pandemic recession rapidly crept up on the country during his final year in office, Mr. Trump reported significant business losses, no federal tax liability, and zero charitable contributions.

White House representatives made a point of highlighting which government entities were paying Mr. Trump’s salary in previous years, beginning with the National Park Service in 2017. According to Mr. Trump’s tax returns, which were made public on Friday, he declared charitable contributions totaling nearly $1.9 million in 2017 and just over $500,000 in both 2018 and 2019.

The tax law that Mr. Trump signed in late 2017 and went into effect the following year seems to have had a mixed impact on him. He most likely benefited from some of its provisions at tax time, such as the lowering of the alternative minimum tax for high earners.

However, the law also set a cap on the so-called SALT deduction, which disproportionately hurt high earners, like Mr. Trump, in states and cities with high taxes like New York. Mr. Trump claimed to have paid $8.4 million in state and local taxes in 2019. Only $10,000 of those taxes were eligible for a tax deduction on his federal income tax return because of the SALT limitations incorporated into his tax law.

The complicated returns for Mr. Trump span thousands of pages. The records demonstrate that he changed accountants to compile them. For many years, Mr. Trump’s taxes and the taxes of his businesses were prepared by the accounting firm Mazars USA. The former president had long listed Donald Bender as his accountant on his tax returns. This year, the company formally severed ties with Mr. Trump and his companies, stating that it could no longer stand behind ten years’ worth of annual financial statements it had produced for the Trump Organization.

But it turns out that even as early as 2020, Mazars and Mr. Trump had started to distance themselves from one another. According to Mr. Trump’s tax returns from that year, his taxes were prepared by the Texas-based accounting firm BKM Sowan Horan. The documents also sparked fresh inquiries about the audits Mr. Trump has experienced while in office and outside of it.

Democrats said last week in their reports the Ways and Means Committee downplayed the influence a 2009 audit with a long-standing open issue had on audits conducted under Mr. Trump’s presidency. An audit of Mr. Trump’s 2015 return had stalled, according to a report by the nonpartisan Joint Committee on Taxation, which studies tax law for Congress. This was because of the “complexity of issues being contemporaneously worked for tax years 2009 through 2013.”

The report withholds information about the audit’s details from 2009 to 2013. However, according to a 2020 investigation by The Times, during those years Mr. Trump requested and received a tax refund of $72.9 million, which included interest and all of the federal income tax he had paid on his initial windfall from his long-running television program “The Apprentice” for the years 2005 to 2008.

The alleged refund appears to have been justified by Mr. Trump giving up his ownership of his casino ventures that year. Because a taxpayer receives a “quickie refund” right away and without having to ask for it, an audit is automatically initiated. In Mr. Trump’s case, the audit was still ongoing when he assumed office.

If the unresolved issues from 2009 through 2013 also prevented later examinations under the mandatory presidential audit program from moving forward, it was not specifically stated in the committee reports that were made public last week. But when there are complicated unresolved disputes from earlier years, the I.R.S. frequently does not begin or finish new audits.

Former Joint Commission on Taxation employee Steven M. Rosenthal asserted that the I.R.S. had probably decided that new audits shouldn’t be conducted until the earlier problems were resolved. Mr. Rosenthal, who is currently a senior fellow at the nonpartisan Urban-Brookings Tax Policy Center, called the decision a “big mistake, which is easy to criticize.”