What’s that we hear from Mar-a-Lago?
It finally happened at 9 a.m. ET this morning (NBC News):
A House committee made public six years of former President Donald Trump’s tax returns Friday, the culmination of years of legal wrangling and speculation about what might be contained in the filings.
The House Ways and Means Committee had voted to make the thousands of pages of returns public in a party-line vote last week, but their release was delayed while staffers redacted sensitive personal information like Social Security numbers from the documents.
What is in there that Trump was so desperate for the world not to see? After all, he bragged in 2016 that paying no taxes made him smart. The smartest guy around. Why not showcase that brilliance?
Tax pros will study Trump’s 500 or so business empire of trusts, limited liability corporations and partnerships. But details will be limited (CBS News):
“On his return, there will be a white paper schedule in the back — it may be five or 10 pages long — it’s going to list all these entities,” said Bruce Dubinsky, a forensic accountant and founder of Dubinsky Consulting.
“We’re not going to know what those [entities] are doing. You’re just going see a line, and an amount — could be income, could be a loss — for that year. We would then need those LLC or S corporation returns to see, OK, what’s going on?”
Such a large number of entities makes it more likely that some sources of Trump’s income, losses or wealth could be left out, offering a misleading picture of his tax status. The IRS has highlighted the complexity of performing a comprehensive examination of Trump’s income and tax liability.
“With over 400 flow-thru returns reported on the Form 1040, it is not possible to obtain the resources available to examine all potential issues,” states an IRS memo cited in the Ways and Means report.
Investigative reporters such as Susanne Craig will try. Until they have time to review the forms and run down public information on the Trump Organization laundry list, we will have to wait to know much and to know, importantly, how much he owes to whom, especially to foreign creditors.
What we do know is that during Trump’s White House tenure, the Internal Revenue Service failed to initiate the customary audit of the sitting president’s taxes. We also know, to no one’s surprise, Trump wants vengeance (CNN):
Trump is already encouraging Republicans to retaliate against House Democrats by obtaining Biden’s financial records. In a campaign video released last week, he called the House Ways and Means Committee’s moves an “outrageous abuse of power” and a “deranged political witch hunt” that began when he launched his first presidential campaign in 2015.
[…]
“We should also get to the bottom line of how Biden, on a salary of a US senator, was able to buy one mansion after another; all these different locations,” Trump said. “When I’m president, we will expose the Washington cartel and we will make America great again.”
What we know already:
Trump paid $1.1 million in federal income tax in 2018 and 2019, in stark contrast to the $750 he paid in 2017 and $0 in 2020, according to the report from the Joint Committee on Taxation
Trump’s tax bill grew substantially as his income surged in 2018 and 2019. Trump reported a $22 million capital gain in 2018 and a $9 million gain in 2019 from asset sales, sending his income into the black following years of enormous losses.
In 2015 and 2016, Trump reported he lost more than $32 million each year. In 2017, Trump said he lost nearly $13 million. But he reported taxable income of $24 million in 2018 and more than $4 million in 2019, giving him a sizeable tax bill.
However, in 2020, as the pandemic hit, Trump once again reported a gigantic loss of nearly $5 million. He paid $0 in federal income taxes that year.
Meantime, celebrate Trump Tax Return Release Day in whatever ways suit you.