Why Donald Trump’s Tax Returns Matter

Business failures, shady tax dodges, conflicts of interest—now we know why he didn’t release them.

Chris Kleponis/Zuma

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Shortly after the 2016 election, I tweeted: “Today would be a good day for @realDonaldTrump to release his tax returns.” Then I repeated this tweet a few mornings in a row. Each day, it received a bunch of retweets, the vital currency of that social media realm, indicating this simple poke at merely one of Donald Trump’s violations of good government norms resonated. Since then, I’ve tweeted out this line almost every day. That is, every weekday, skipping holidays sometimes, never programming the tweet to appear automatically. It became something of a mantra I would type out, often to start my day. I’ve done it hundreds of times, and folks on Twitter seemed to enjoy the daily reminder. Sometimes when I would forget, people would tweet at me and ask, “What would today be a good day for?” 

On Sunday night, our collective wish kind of came true. The New York Times published a blockbuster report based on Trump’s tax returns and other tax information it had obtained that covers over two decades. Trump himself had not released the material, but this was the next best thing. The story revealed that Trump paid no income taxes for 11 out of 18 years, that key Trump businesses lost huge amounts of money, and that Trump used all sorts of dodgy—and legally questionable—devices (including paying his daughter Ivanka a consulting fee, even though she was an officer of the Trump Organization, and deducting the amount) to skip out on his tax bill. The article was so sweeping that the Times felt compelled to publish a cheat sheet to the eye-popping revelations. But the bottom line was clear: Trump was not a successful business genius, and he apparently had conned the US government. (One year, he paid only $750 in income taxes to the United States but paid $15,598 to Panama.) 

Though my Trump tweet had become a bit of a joke, the tax returns were always an appropriate focus for attention. Trump’s steadfast refusal to release them was an early sign that Trump believed rules and norms do not apply to him. (And the lack of criticism and pressure from Republicans on this front was an indicator that the GOP would give up on holding Trump accountable.) For decades presidential candidates and president had routinely shared their tax returns with voters. Though Trump had once promised that if he ran for the White House, he, too, would make public this information, he flip-flopped as a candidate. He argued that because he was being audited, he could not reveal his taxes. That was, of course, a lie. There was no rule saying that audited returns could not be disclosed. It was up to him. And he didn’t even bother to tell voters what years were being audited. In the White House, he continued to keep his returns hidden, sticking with the phony-baloney audit excuse. (By law, the tax returns of a president are audited, and still all the recent chief executives have released them.)

Trump’s trashing of this tradition was troubling, for, as a business owner with interests around the world, his tax returns were important for assessing his actual or potential conflicts of interest. They were also important for evaluating his sales pitch. He contended that because he was a super successful, deal-making billionaire, he was qualified to be president of the United States. But the finances of the Trump Organization were opaque—Trump used literally hundreds of separate companies to do business—and voters had no way of knowing whether he was bullshitting them. His tax returns were one of the few ways to objectively judge this novice politician. They could be the corrective to his I-am-the-greatest propaganda. They also could reveal a crucial element for any politician, let one seeking the highest office in the land: is he or she honest? 

The Times story proves that obsessing over the returns was justified. These records don’t answer all the questions one might have about Trump and his business endeavors. For instance, they do not tell us how much he is worth. For decades, he has bragged about his wealth, claiming he is a billionaire. He even sued journalist Tim O’Brien when O’Brien wrote a book that reported Trump was worth only about $200 million and was far from the three-comma club. And the tax returns do not outline the details of every deal or loan.

Yet Trump’s returns do disclose much about his ventures and his character. As the Times reports, he engaged in a slew of shenanigans to short-change the government. This included declaring a personal property as an investment property. It included demanding a tax refund of $72.9 million that the IRS has challenged. It included claiming a series of questionable consultant payments as big deductions. The returns show that some of his most famous properties—such as the Trump National Doral country club near Miami and his fancy hotel in Washington, DC—are big losers. They indicate he has, as the Times put it, “received more money from foreign sources and U.S. interest groups than previously known.” His overseas take included $2.3 million in profit he received from a Putin-allied Russian billionaire named Aras Agalarov, who was Trump’s partner for the 2013 Miss Universe contest held in Moscow. Though Trump walked away from that enterprise with millions, Agalarov took a bath, losing about $10 million. Trump, of course, can claim this is a testament to his business acumen. But there’s another way to see it: a Putin ally lost a lot of money in order to put over $2 million in Trump’s own pocket. 

The tax returns also show what Mother Jones has previously reported on: Trump has over $400 million in loans coming due in the next few years, and he has few obvious means for making good on all this debt. This poses a gargantuan conflict-of-interest problem, with the American president in hock to a foreign bank (Deutsche Bank) and others. 

Trump’s tax returns are not quite a Rosetta Stone. Has he committed tax fraud or bank fraud by under- or over-valuing his assets, as his former attorney Michael Cohen has alleged? These records don’t confirm that, but this is now being probed by New York investigators. Still, Trump’s tax filings reinforce what’s already known about him: he is a dishonest huckster. (See the 2018 New York Times investigation that showed how Trump and his family years earlier engaged in “fraud” to avoid paying hundreds of millions of dollars in taxes.)

After the Times story broke on Sunday, I appeared on a cable news show, and the host asked me and other guests whether this exposé would make any difference to Trump supporters. The answer is, probably not. They have already pledged fealty to a self-proclaimed sexual assaulter, who paid off a porn star, who has lied thousands of times since taking office (according to various fact-checkers), who has encouraged political violence, and who has botched the government’s response to a pandemic that has killed over 200,000 Americans. But in a close election, everything counts. And this revelation underscores that Trump is a phony. That he cannot be trusted. That he is not the success he claims to be. This is the curtain that Trump never wanted pulled back. With the assorted, immediate, and dire threats facing the nation—the coronavirus crisis, the economic downturn, social injustice, climate change, and more—the compelling question of the moment is whether the country can effectively confront these challenges with a scoundrel in the White House. 

The tax returns were always one key to a more complete understand of Trump, his conflicts of interest, and his willingness to trample rules and eschew transparency. Targeting this one misdeed of his—Trump’s defiance of the traditional release of such records—was both literal and symbolic. It was meant to point out that he did not and would not adhere to fundamental rules that serve the public interest. And now we know why he could not. 

I’ve been asked what I will be tweeting now. The Times notes that the cache of documents it obtained did not include Trump’s tax returns for 2018 and 2019. I think that answers the question.


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