Do we remember when Trump bragged about not paying taxes on September 26, 2016: "That makes me smart"? Well, fast forward to September 27, 2020

 

“Late [yesterday] afternoon, the New York Times published the story we have been waiting for since 2016: the story of Donald Trump’s taxes. There was never any doubt that whatever was in those taxes was bad or he never would have worked so hard to hide them. But the picture the New York Times story revealed was worse than expected.

“The New York Times obtained more than two decades of Donald Trump’s tax information, including that of his companies, through his first two years in the White House. The picture they paint is of a man more than [$400] million in debt; whose businesses are constantly losing money; who deducts personal expenses including houses, airplanes, and $70,000 in hairstyling; who is fighting with the IRS over the repayment of a $72.9 million tax refund which, if it has to be repaid, will run to $100 million; and who in his first year in office paid the most income tax he had paid in a decade: $750.

“That’s not a typo.

“In 11 of the 18 years the reporters examined, Trump paid no taxes at all. He has, however, paid taxes elsewhere. In 2017, Trump paid $750 to the U.S., but paid $15,598 in Panama, $145,400 in India, and $156,824 in the Philippines (rather undercutting the idea that American tax laws are too harsh on the very wealthy).

“The information illuminates a number of the shadowy puzzles of the Trump presidency. It shows that he was deeply in debt in 2015, and was, as his former fixer Michael Cohen said, eager to rebuild his brand by running for the highest office in the land. He had a bad habit of running through cash and accumulating huge debt, a pattern that showed up first when he ran through the money his father gave him, and then when the brief popularity of The Apprentice put $427.4 million into his pocket. He threw the money from The Apprentice into failing golf courses.

“The presidency has injected cash into Trump’s businesses, as lobbyists and foreign governments invest in them, but he is still losing money. The Times notes that ‘within the next four years, more than [$400] million in loans—obligations for which he is personally responsible—will come due.’

“This, of course, means that Trump is a huge national security risk. He owes money—to whom we don’t know—and he does not have it to pay his debts. It is no wonder that a bipartisan group of nearly 500 national security officials, past and present, last week endorsed Biden for president. According to Defense News, the list included ‘five former secretaries of the Navy, two former Army secretaries, four former Air Force secretaries, two retired governors, and 106 ambassadors.’ Retired General Paul Selva, who served as vice chairman of the Joint Chiefs of Staff for the first two and a half years of Trump’s term, signed the letter.

“The tax returns also suggest that Trump’s desperation to stay in office is sparked by the 1973 Department of Justice’s Office of Legal Counsel memo saying a sitting president cannot be indicted. Former inspector general of the Department of Justice Michael Bromwich tweeted ‘Trump knew something we didn't when he started balking at the peaceful transfer of power. If he loses the election, he faces federal and state prosecution for bank fraud, tax fraud, wire fraud, and mail fraud, as does his entire family. No OLC memo will spare him.’

“Among other things, the information revealed that Trump wrote off about $26 million in ‘consulting fees’ between 2010 and 2018. This reduced his taxable income, but it appears it might have simply been a way to give money to his children without paying taxes on it: his daughter Ivanka appears to have received $747,622 from the Trump Organization in consulting fees, despite being an employee there.

“Remember, this is the information Trump chose to tell the IRS. It seems worth wondering what he did not tell them. The Times says it will not release the actual documents in order to protect its source(s). It also says it will continue to drop more news from this trove over the coming weeks.

“A piece from Michael Kranish at the Washington Post today reinforced the New York Times story. Apparently, when he was on the verge of personal bankruptcy in the 1990s, Trump tried to trick his 85-year-old father, who was sliding into dementia, into signing a codicil to his will that would cheat Trump’s siblings out of their inheritance and give Trump control of his father’s entire estate. Trump’s mother stopped her husband from signing it.

“Trump had a press conference scheduled for shortly after the New York Times story broke. When asked about it, Trump claimed the story was ‘totally fake news,’ although a lawyer for the Trump Organization could only try to refute the story with misleading information. After the conference, CNN’s Ana Cabrera pointed out that Trump could stop the New York Times story if it were wrong by ‘releasing his tax returns, by making them public.’…” (Heather Cox Richardson).

 

Some key takeaways from the Times’ reporting from AP News:

TRUMP PAID JUST $750 IN TAXES IN BOTH 2016 and 2017.

The newspaper said Trump initially paid $95 million in taxes over the 18 years it studied. But he managed to recover most of that money by claiming — and receiving — a stunning $72.9 million federal tax refund. According to the Times, Trump also pocketed $21.2 million in state and local refunds, which are typically based on federal filings.

Trump’s outsize refund became the subject of a now-long-standing Internal Revenue Service audit of his finances. The audit was widely known. Trump has claimed it was the very reason why he cannot release his returns. But the Times report is the first to identify the issue that was mainly in dispute.

As a result of the refund, Trump paid an average $1.4 million in federal taxes from 2000 to 2017, the Times reported. By contrast, the average U.S. taxpayer in the top .001% of earners paid about $25 million annually over the same time frame.

TRUMP HAS FINANCED AN EXTRAVAGANT LIFESTYLE WITH THE USE OF BUSINESS EXPENSES.

From his homes, his aircraft — and $70,000 on hair styling during his television show “The Apprentice” — Trump has capitalized on cost incurred from his businesses to finance a luxurious lifestyle.

The Times noted that Trump’s homes, planes and golf courses are part of the Trump family business and, as such, Trump classified them as business expenses as well. Because companies can write off business expenses as deductions, all such expenses have helped reduce Trump’s tax liability.

MANY OF HIS BEST-KNOWN BUSINESSES ARE MONEY-LOSERS

The president has frequently pointed to his far-flung hotels, golf courses and resorts as evidence of his success as a developer and businessman. Yet these properties have been draining money.

The Times reported that Trump has claimed $315 million in losses since 2000 on his golf courses, including the Trump National Doral near Miami, which Trump has portrayed as a crown jewel in his business empire. Likewise, his Trump International Hotel in Washington has lost $55 million, the Times reported.

FOREIGN VISITORS HAVE HELPED SUPPORT TRUMP’S PROPERTIES

Since Trump began his presidential run, lobbyists, foreign governments and politicians have lavished significant sums of money on his properties, a spending spree that raised questions about its propriety and legality.

The Times report illustrates just how much that spending has been: Since 2015, his Mar-a-Lago resort in Florida has taken in $5 million more a year from a surge in membership. The Billy Graham Evangelistic Association spent at least $397,602 in 2017 at Trump’s Washington hotel. Overseas projects have produced millions more for Trump — $3 million from the Philippines, $2.3 million from India and $1 million from Turkey.

TRUMP WILL FACE FINANCIAL PRESSURE AS DEBTS COME DUE

Trump seems sure to face heavy financial pressures from the enormous pile of debt he has absorbed. The Times said the president appears to be responsible for $421 million in loans, most of which will come due within four years. On top of that, a $100 million mortgage on Trump Tower in New York will come due in 2022.