In a bombshell report released on Sunday, the New York Times had obtained tax-return data for President Donald Trump and his companies spanning back more than two decades.
While he was running for president in 2016, Trump had said publicly that he would release his taxes, but that they were under audit; then when he became president refused to release them. The report from the Times gives a detailed reason as to what he may have been trying to hide. NYT editor Dean Baquet wrote a note explaining why they chose to release the findings of their investigation.
“We are publishing this report because we believe citizens should understand as much as possible about their leaders and representatives — their priorities, their experiences and also their finances,” Baquet said. “Every president since the mid-1970s has made his tax information public. The tradition ensures that an official with the power to shake markets and change policy does not seek to benefit financially from his actions.”
“Our latest findings build on our previous reporting about the president’s finances. The records show a significant gap between what Mr. Trump has said to the public and what he has disclosed to federal tax authorities over many years. They also underscore why citizens would want to know about their president’s finances: Mr. Trump’s businesses appear to have benefited from his position, and his far-flung holdings have created potential conflicts between his own financial interests and the nation’s diplomatic interests.”
Among the biggest revelations in the article:
a) Mr. Trump had paid no federal income taxes for much of the past two decades: In 2016 and 2017, he had only paid $750 each year – far below the average of what an affluent American (about 1/100,000 of the population) would pay – which is about 24.1 percent. In fact, Trump has paid about $400 million less in federal income taxed than other wealthy people who had paid the average for that group each year.
b) His tax avoidance set him apart from past presidents: While Trump may be the richest president in U.S. history, he has also paid much less than his predecessors. Both Barack Obama and George W. Bush had paid more than $100,000 per year in federal income taxes while in office.
c) Mr. Trump’s companies set aside about 20 percent of income for unexplained ‘consulting fees’: those specific fees reduce taxes, because companies are able to write them off as a business expense, which the amount of final profit subject to tax. Trump has written off about $26 million in said fees since 2010; in The Times investigation, they discovered that Mr. Trump’s private records show that his company once paid $747,622 in fees to an unnamed consultant for hotel projects in Hawaii and Vancouver, British Columbia. Ivanka Trump, who joined the White House staff in 2017, received a similar amount through a consulting company she co-owned, according to a public disclosure form she had filled out.
d) Most of Trump’s businesses lose large amounts of money: Since 2000, Trump has reported losing more than $315 million from his golf courses – which he considers the heart of his business empire. The only property that makes profit for him is Trump Tower in New York, which earns him more than $20 million in profits each year. However, The Times calculated that between 2004 and 2018, Mr. Trump made a combined $427.4 million from selling his image – which was a huge reason for how he became the first President of the United States with zero political experience.
e) Many of the bills Trump owes are coming due: Based on the investigation, Trump has paid none of the principal mortgage on Trump Tower, and the full amount of it ($100 million) is due in 2022. He is also in a dispute with the I.R.S. over his 2010 refund, which he could end up owing the government more than $100 million (including interest) if he loses. Trump is also responsible for loans totaling $421 million, most of which are due within the next four years – meaning if Trump wins re-election, his lenders could be forced to consider foreclosing on a sitting president – a position that could be very contentious.
