According to the six years of Donald Trump’s federal tax returns, which were made public on Friday, the former president claimed significant losses that helped reduce his tax bill in the first and last years of his presidency and paid very little in federal income taxes.
The House Ways and Means Committee’s Friday release of the returns, which had been kept secret for a long time, was the result of a Supreme Court battle over their disclosure. They back up a report from the Joint Committee on Taxation that said Trump took big losses before and during his time in office in order to cut down on or almost eliminate his tax bill. His returns, for instance, show that he carried forward losses of $73 million in 2016 and $105 million in 2015.
After a prolonged legal battle, the Democratic-run committee was only able to obtain the returns, which cover the years 2015 to 2020. The committee voted last week to make the tax returns available, but the process of redacting private information like Social Security numbers delayed their release.
The tax returns, which total thousands of pages, are currently under review by CNN.
Following a long search for documents that had typically been made public voluntarily by previous US presidents, the tax returns have been made available. Trump and his legal team made it a point to keep his tax returns a secret, arguing that Congress had never used its legislative power to demand a president’s tax returns, which could have far-reaching repercussions, Trump said.
In a statement released following the publication, Trump stated, “The Democrats should have never done it, the Supreme Court should have never approved it, and it’s going to lead to horrible things for so many people.”
“The “Trump” tax returns once more demonstrate how proud I am of my success and how I was able to use depreciation and other tax deductions to encourage the creation of thousands of jobs and magnificent structures and businesses.”
Texas Rep. Kevin Brady, the committee’s most conservative Republican, said a release would be “a dangerous new political weapon that reaches far beyond the former president and overturns decades of privacy protections for average Americans that have existed since the Watergate reform.” Other Republicans also criticized Democrats’ efforts to obtain the tax returns as political.
The US tax code’s section 6103 authorized the committee, which is in charge of overseeing the IRS and formulating tax policy, to request the returns. Their report primarily examined whether the IRS’s mandatory audit program for US presidents properly audited Trump’s tax returns while he was president.
The committee discovered that the IRS only conducted one “mandatory” audit during Trump’s term, and that it was for his tax return from 2016. What’s more, that didn’t occur until the fall of 2019, after Director Richard Neal, a Massachusetts liberal, first sent a letter asking the IRS for Trump’s profits and duty data. The presidential audit program is described in the report as “dormant.”
In a vote that was largely symbolic, the House last week approved a bill to reform the presidential audit procedure before Republicans took control of the House. The Senate is unlikely to take up the legislation before the new Congress is sworn in.
A nonpartisan Joint Committee on Taxation analysis of the numbers from each of the six Trump tax returns was included in the committee’s report. The JCT found that the former president paid just $750 in federal income tax in 2017 and nothing in 2020. In addition, the report revealed that Trump paid no federal income taxes in 2020 or 2017 and only $750 in 2018 and $1.1 million in 2019.
A New York Times investigation revealed that prior to running for president, Trump had claimed significant net operating losses that he was permitted to carry forward and apply to subsequent tax years, greatly reducing or eliminating his annual income tax liability.
For instance, Trump carried forward losses totaling $105 million from his return in 2015, $73 million in 2016, $45 million in 2017, and $23 million in 2018.
Additionally, the JCT report raises concerns regarding the veracity of significant charitable deductions claimed by Trump on a number of his tax returns. The amount of income tax due can be reduced by deductions.
Although Trump’s net worth and financial dealings will not be fully disclosed in the newly released tax returns, they may provide insight into his businesses’ profits and losses, as well as whether or not he has foreign bank accounts or paid tax to foreign governments.