Donald Trump's Tax Returns has been making wave since their revelation on Wednesday.
There has been much speculation about the wealth and business savvy of former President Donald Trump for decades. Does Donald Trump Pay taxes? This question has been asked by many for many years. But now, thanks to a House Ways and Means Committee revelation, the public can now finally get a peek at his tax returns.
The report issued by the panel revealed that Trump and his wife, Melania, reported negative income in four of the six years between 2015 and 2020. In three of those years, they reported paying just $750 in federal income tax— a figure that most Americans only pay in taxes once a year.
Trump's tax returns also revealed that in the same six-year period, Trump and his wife reported an adjusted gross income of negative $53.2 million, and their total federal tax liability, including self-employment and household employment taxes, was just $4.4 million.
These revelations have left many scratching their heads wondering how this is even possible. Trump’s wealth is estimated by Forbes to be around $2.4 billion, and he is one of the few who has routinely reported income in the hundreds of millions of dollars.
It is also worth noting that the Trump businesses themselves paid about $75 million in taxes, separate from the $750 in annual income taxes that Trump himself paid during this period. This suggests that Trump employed a variety of aggressive tax strategies that allowed him to pay far less than the average American, while still profiting from his businesses.
In 2020, during the coronavirus pandemic, the Trumps declared a loss of $4.8 million and did not pay any federal taxes.
These tax returns seem to confirm what many have long suspected: that Trump isn’t the self-made man he claims to be and that his tax returns are likely reflective of the wealth he has accumulated through inheritance and savvy investments.
It is clear that Trump was able to minimize his overall tax liability in the years covered by the tax returns, but it is not clear exactly how he did it or why he would choose to pay so little in taxes. Regardless, it remains curious as to why one of the world’s richest men paid virtually nothing in federal income tax—a mystery that could only be solved by a full release of Trump’s tax returns.
The release of Donald Trump's tax returns followed a legal battle that began in April 2019 and went to the Supreme Court. The IRS's executive summary, which is 29 pages long, also revealed that the IRS did not conduct a mandatory audit of Trump's tax returns during his first two years in office, contrary to a requirement that has been in place since 1977 after the controversy surrounding former President Richard Nixon's taxes.
The IRS only began examining Trump's individual tax return for 2015 (the year he announced his candidacy) on April 3, 2019, the same day that the House Ways and Means Committee, chaired by Richard Neal (D-Mass.), sent a letter to the IRS requesting information about the returns. More than five months later in September 2019, the agency selected Trump's 2016 return for a mandatory audit. The individual returns for 2017, 2018, and 2019 were not selected for examination until after Trump had left office.
The committee did not provide any evidence that Trump attempted to directly influence the IRS or discourage the agency from reviewing his tax information, but the report did identify issues with the agency's approach to the audits.
During his 2016 campaign for president, Donald Trump became the first White House candidate in four decades to refuse to voluntarily disclose his tax returns, citing an alleged audit as the reason. However, it was never clear if Trump was referring to the mandatory audit process specifically for presidents or to reviews that took place before his political career.
In September 2020, The New York Times reported that Trump was facing an IRS audit potentially related to a $72.9 million tax refund resulting from the $700 million in losses he claimed in 2009. The newly released documents show that Trump continued to receive tax benefits from those losses through 2018.
A spokesperson for Trump characterized the release of the returns as an “unprecedented leak by lame duck Democrats” in a statement to the Wall Street Journal.
Trump, who is 76 years old, announced last month that he will be running for president again in 2024.