Six years of federal tax returns released by Donald Trump on Friday showed the former president paid little federal income tax in the first and last years of his presidency, claiming the huge losses helped limit his tax bill, and other disclosures.
The House Ways and Means Committee released the long-secret returns to the public on Friday, the culmination of a Supreme Court battle over its disclosure. They corroborated a report released by the Joint Committee on Taxation that said Trump had claimed huge losses before and throughout his presidency that he carried on to reduce or virtually eliminate his tax burden. For example, his returns show he carried forward a $105 million loss from 2015 and a $73 million loss from 2016.
Thousands of pages of documents from the former president’s personal and corporate tax returns — spanning from 2015 to 2020 — were obtained only weeks ago by a Democratic-run committee after a protracted legal battle. The committee voted last week to release the tax returns, but the delay was to redact sensitive personal information such as Social Security numbers.
CNN is currently reviewing the tax returns.
The release of the tax returns follows a years-long hunt for documents that past U.S. presidents typically voluntarily release. Trump and his legal team have sought to keep his tax returns private, arguing that Congress never exercised the legislative authority to require the president to file them, which Trump said could have far-reaching consequences.
“The Democrats should never have done this, the Supreme Court should never have approved it, and it would have dire consequences for so many people,” Trump said in a statement after the release.
“‘Trump’s’ tax returns show yet again how proudly successful I am and how I was able to use depreciation and other various tax breaks to incentivize the creation of thousands of jobs and magnificent buildings and businesses .”
The joint tax committee noted that Trump claimed a plethora of questionable items on his tax returns, including eye-popping amounts of interest he claimed to have received on his children’s loans, a bipartisan committee that said could suggest that Trump Pu is disguising gifts.
The JCT did not claim that Trump should have paid more or less in taxes in the years it reviewed, but argued that auditors should have investigated the loan agreements Trump entered into with his children, including interest rates. For example, if the interest Trump claims to charge his children is not the market rate, it could be viewed as a gift for tax purposes, requiring him to pay a higher tax rate on the money.
In 2017, for example, Trump claimed he received $18,000 in interest on a loan he said was to his daughter Ivanka Trump. He claimed $8,715 in interest from his son, Donald Trump Jr., and $24,000 from his son, Eric Trump.
In its report, the JCT said this raised the question of “whether the loan was a genuine arm’s length transaction, or whether the transfer was a disguised gift that could trigger gift taxes and interest deductions not allowed by the associated borrower.”
“It’s unusual to be interested in round numbers — very rare,” said Martin Schell, a former special agent for surveillance in the IRS Criminal Investigations Division. “Auditors want to see payments, loan agreements and interest rates.”
Trump reported having foreign bank accounts between 2015 and 2020, including in China between 2015 and 2017, according to his tax returns.
Trump was required to report the accounts to the Financial Crimes Enforcement Network (FinCEN). The documents show that the former president opened foreign bank accounts in countries including the United Kingdom, Ireland and China.
Alan Garten, a lawyer for the Trump Organization, said at the time that the Chinese bank accounts reported by The New York Times in 2020 were related to Trump International Hotel Management’s business push in China.
The 2020 Trump campaign sought to paint rival Joe Biden as a Chinese “puppet” amid revelations of Chinese business dealings. Biden’s income tax returns and financial disclosures show no business dealings or income from China.
The committee that oversees the IRS and sets tax policy requires filings under Section 6103 of the US Tax Code. Their report focuses on whether Trump’s tax returns during his presidency were properly audited under the IRS’ mandatory audit program for the president of the United States.
The committee found that the IRS conducted only one “mandatory” audit of Trump’s 2016 tax returns during his tenure. That didn’t happen until the fall of 2019, when Richard Neal, chairman of the Massachusetts Democratic Party, first sent a letter requesting Trump’s returns and tax information from the IRS. The report described the presidential audit program as “dormant.”
Other Republicans also criticized Democrats’ efforts to secure the tax returns as political, said the Texas Rep. Kevin Brady – the committee’s top conservative – said the release would amount to “a dangerous new political weapon that reaches far beyond the former president and overturns decades-long restrictions on ordinary Americans that have existed since the Watergate reforms.” privacy protection.”
Last week, the House of Representatives passed a bill that would overhaul the presidential audit process in a largely token vote, after Republicans secured a majority in the new Congress. The Senate is not expected to pass the bill until the new Congress is sworn in.
The committee’s report included an analysis by the nonpartisan Joint Committee on Taxation of data from each of Trump’s six tax returns. In the JCT findings, the then-president paid very little in federal income taxes in 2017 — just $750 — and nothing in 2020. The report also showed that Trump paid a combined $1.1 million in federal income taxes in 2018 and 2019, compared with $750 he paid in 2017 and $0 in 2020.
For many years, before he ran for president, a New York Times investigation revealed that Trump had reported huge net operating losses that he was allowed to carry forward and apply to future tax years, significantly reducing or outright eliminating his annual Income Tax Liability.
For example, the JCT report noted that Trump carried forward losses of $105 million in 2015 returns, $73 million in 2016, $45 million in 2017 and $23 million in 2018.
The JCT report also casts doubt on the accuracy of some of the large charitable deductions claimed by Trump in several of his tax returns. Deductions can reduce the amount of income tax owed.
While the newly released tax returns won’t reveal Trump’s net worth or his full range of financial dealings, they could provide a window into his business profits and losses, whether and where he has foreign bank accounts, or Whether he pays taxes to foreign governments.
This is a breaking story and will be updated.