Trump Taxes
September 29, 2020

Over the weekend, The New York Times published a sweeping investigation into many years of President Trump's tax returns, which they obtained from an anonymous source. It turns out Trump has paid no federal income tax for 10 of the last 15 years, and in 2016 and 2017 he paid just $750.

This bombshell reporting poses two serious political problems for Trump. First, he has (as usual) claimed that the reporting is "fake news." He could prove that by releasing his actual returns, but he has resisted doing so for years, probably because he doesn't want people to see them. So either he lets people pick over his returns publicly, or he validates the Times reporting (which has certainly been heavily fact-checked) by acting guilty. A literal billionaire paying less in federal income tax than a single childless adult making $18,000 is bound to be unpopular.

That leads into the second problem — with Trump's image. He has always portrayed himself as an ultra-successful businessman. In reality, for the last 20 years, Trump's main money-making ventures have been pretending to be a successful businessman on The Apprentice, together with branding and endorsement deals. At the same time, he zeroed out his tax liability by losing staggering sums on other businesses he owns. Just on golf courses alone he has lost over $315 million since 2000.

Trump's 2016 campaign relied very heavily on his supposed business acumen. "I'm going to be greedy for the United States," he said in a speech that year. Fewer people would have voted for him if they knew that his most remarkable characteristic was losing truly eye-popping amounts of money — more than any other taxpayer in several prior years. But now, it seems that is an undeniable fact. If Trump returns to private life, perhaps his next TV gig can have a different title. Ryan Cooper

September 29, 2020

Thanks to The Apprentice, President Trump was able to secure $230 million in licensing and endorsement deals, The New York Times reports, doing everything from shilling nearly obsolete video technology to co-writing a book called Think Big and Kick Ass: In Business and Life.

When The Apprentice premiered in January 2004, Trump boasted he was able to recover from financial setbacks because of his "brain" and "negotiating skills." Tax records obtained by the Times show that this confidence and ability to market himself attracted several companies. For example, Trump received $7.3 million for showing up to Learning Annex speaking engagements, the Times reports, and earned $1.4 million in royalties for his Think Big and Kick Ass book, co-written by the Learning Annex's founder.

The biggest deal Trump signed was with ACN, a multilevel marketing company that has been accused of using predatory tactics to lure in its workforce. Independent sales agents sign up to sell ACN's products, like satellite television and video phones, from their homes, but regulators found that a vast majority don't make any money — officials in Montana said that on average, participants in the state paid $750 in fees to ACN but received only $53 in return. ACN has settled with state regulators, without admitting wrongdoing.

ACN paid Trump $8.8 million, and he promoted ACN products in DVDs and on The Apprentice, the Times reports. ACN's website also featured a gushing testimonial from Trump, who said the company "has a reputation" for "success that's really synonymous with the Trump name and other successful names, and you can be part of it." A class action lawsuit is now pending against Trump, with one plaintiff saying she signed up to sell ACN products after she "watched clips of ACN appearing on Celebrity Apprentice."

ACN wasn't the only multilevel marketing company Trump worked closely with during the Great Recession's unemployment crisis. In 2009, he struck a $2.6 million deal with a vitamin company, Ideal Health, that changed the name of its product to Trump Network, the Times reports. Trump regularly gave speeches and appeared in videos encouraging people to sign themselves and loved ones up for starter kits costing nearly $500.

In one video, Trump said the Trump Network was there to "give millions of people renewed hope," and had "an exciting plan to opt out of the recession." Ideal Health was sold within a few years and then fell into bankruptcy. Read more at The New York Times. Catherine Garcia

September 29, 2020

The Apprentice came along in the nick of time for President Trump, The New York Times reports — the reality show's popularity allowed him to monetize his fame, and this "$427 million lifeline" gave Trump a huge boost financially after years of major losses.

The Times obtained tax return data for Trump covering more than two decades, and on Sunday, reported that he paid $750 in federal income taxes in 2016 and 2017. The records also show that in 10 of the previous 15 years, Trump paid no income taxes because he reported losing more money than he made. On Monday, the Times published part two of its deep-dive into the records, this time focusing on Trump's Apprentice years.

Over 16 years, Trump earned about $197 million directly from The Apprentice, and $230 million from licensing and endorsement deals linked to the show, with his face selling everything from Double Stuf Oreos to Serta mattresses to All laundry detergent. Throughout the 1990s and early 2000s, Trump reported tens of millions in annual net losses on his income tax returns, but he began declaring positive adjusted gross income when the money started coming in from The Apprentice, the Times reports.

Trump is an avid golfer, and when The Apprentice premiered in January 2004, he operated two golf courses and had two others that were undergoing renovations. From 2006 to 2016, Trump used his Apprentice money to buy 11 more golf courses, but they have been hemorrhaging money, the Times reports; tax records show from 2014 to 2017, Trump put $144.5 million into his Turnberry course in Scotland, despite the property reporting massive losses every year.

Trump had an arrangement with The Apprentice producer Mark Burnett, where they would split profits from product placements on the show, the Times reports. That helped Trump, but when ratings started to drop in 2011, Trump's Apprentice money also began drying up — he went from making $51 million that year to $21 million in 2014, and received less than $3 million in 2018. During the early 2010s, the Times says, Trump began selling millions in stocks and bonds and borrowed $100 million against his equity in Manhattan's Trump Tower. Read more at The New York Times. Catherine Garcia

September 28, 2020

Andrew Weissman, a prosecutor who served as one of former Special Counsel Robert Mueller's top lieutenants during the investigation into 2016 Russian election interference, on Monday connected revelations about President Trump's tax information to Moscow.

The tax information, obtained by The New York Times, has sparked speculation that Trump may owe hundreds of millions of dollars to an unknown funding source that kept his businesses alive over the years. Weissman suggested that Trump's son, Eric Trump, may have provided the geographic location of the money, if not the exact source, all the way back in 2014, before the elder Trump had announced his 2016 presidential campaign. "We have all the funding we need out of Russia," Eric Trump said in 2014.

Weissmann is just one of many wondering if there's a common thread between the tax information, the 2016 election, and the president's foreign policy strategy, but the Times notes its investigation was unable to reveal "any previously unreported connections to Russia," so the situation remains unclear. Tim O'Donnell

September 28, 2020

The New York Times' report on President Trump's tax info shed a significant amount of new light on his businesses and personal wealth, but there are still several questions left unanswered. Journalist Adam Davidson, who has reported on Trump's business dealings for The New Yorker, suggests people look to Trump's golf courses to find out more.

One of Davidson's big takeaways from the Times report is that Trump had a "new source of funds" beginning around 2011 after he had finished "blowing through" most of the money he received from his father, television producer Mark Burnett, and through loans. It's not clear who this alleged new source of money may be, but Davidson believes golf courses could be the key. In 2011, Davidson writes, Trump went into business with families from Azerbaijan, and was also "flirting" with Georgian and Kazakh businesses that have ties to Russian President Vladimir Putin. Between 2011 and 2016, all of those groups were known to be laundering money through golf courses.

Trump, of course, has his own courses across the U.S., as well as in other countries, and those properties have cost him a lot of money. Davidson singled out his Scottish golf resorts, which have prompted investigation requests in the past, because that is where he, perhaps confoundingly, spent the post-2011 money.

But speculation is just that, and Davidson argues that little more can be known about who Trump "owes and what they know about him" until the alleged funding source is uncovered. Tim O'Donnell

September 28, 2020

President Trump paid no income tax in 11 of the 18 years from 2000 to 1018, The New York Times reported late Sunday, citing copies of tax records it had legally obtained from unidentified sources, but he did pay $750 in both 2016 and 2017.

But he did report paying taxes on a number of his overseas ventures, which brought in $73 million in revenue (not profit) in his first two years in the White House, the Times reports. But "in 2017, the president's $750 contribution to the operations of the U.S. government was dwarfed by the $15,598 he or his companies paid in Panama, the $145,400 in India and the $156,824 in the Philippines."

A Trump organization lawyer pointed out to the Times that Trump did pay more in federal taxes — likely meaning Social Security and Medicare contributions and taxes for his household employees. And the Times notes that Trump "paid substantial federal income taxes for the first time in his life," $70.1 million, from 2005 to 2007, when the tax-reducing power of nearly a billion in 1995 losses dried up and he started earning serious money from The Apprentice and related licensing deals — but he recouped most of that money, plus interest, starting in 2010 by taking advantage of an obscure provision of a bill passed after the 2008 financial meltdown.

The $72.9 million tax refund Trump eventually secured has been under scrutiny by the Internal Revenue Service and the bipartisan Joint Committee on Taxation since 2011, and if the audit finds he cheated — the Times suggests that's at least possible — he could owe the U.S. government more than $100 million.

Trump's foreign business entanglements also pose a long list of potential conflicts of interest, both foreign and domestic, and Turkey has been particularly aggressive in wielding its leverage, the Times reports. The good news for Trump is that the records the Times obtained don't "reveal any previously unreported connections to Russia." Read more (in depth or in brief) at The New York Times. Peter Weber

September 28, 2020

President Trump's tax records show he has classified his Seven Springs estate in Bedford, New York, as an investment property, The New York Times reports, but his son Eric Trump has described it as his family's "home base."

Seven Springs sits on 200 acres and boasts three pools and multiple carriage houses, according to the Trump Organization. Trump purchased the property in 1996 with the intention of building 15 private homes, a golf course, and a clubhouse on the land, but local residents were able to stop the development, citing concerns over traffic and pollution.

In 2014, Trump classified Seven Springs as an investment property rather than a personal residence, and since then he has written off $2.2 million in property taxes as a business expense, the Times reports. That same year, Eric Trump told Forbes Seven Springs is "really our compound," and served as "home base for us for a long, long time." The Trump Organization's website also says the property is currently "used as a retreat for the Trump family."

Trump also placed a conservation easement on the land in 2015, meaning he signed a deal with a land conservancy, agreeing to leave most of the property untouched. In exchange for this, Trump claimed a $21.1 million charitable tax donation, the Times reports. His tax records show that over the years, Trump has claimed four conservation easement deductions on his taxes, which represent about $119.3 million of the roughly $130 million in personal and corporate charitable contributions he has reported to the Internal Revenue Service, the Times reports. When asked for comment about Seven Springs, Alan Garten, a lawyer for the Trump Organization, did not respond. Catherine Garcia

September 28, 2020

President Trump's tax filings show that since 2015, business has been booming at his Mar-a-Lago club in Palm Beach, Florida, thanks to an influx in new members and an initiation fee increase that went into effect when Trump was inaugurated in January 2017, The New York Times reports, citing Trump tax records covering more than two decades.

The Times found that when Trump announced he was running for president in 2015, Mar-a-Lago became inundated with new members. In 2014, the club earned $664,000 in initiation fees, and that number went up to just under $6 million in 2016; in January 2017, Trump doubled the cost of initiation.

The Internal Revenue Service says that for a business expense to be deducted, it must be "ordinary and necessary." Business expenses at Mar-a-Lago for 2017 included $109,433 for linens and silver, $197,829 for landscaping, and $210,000 for event photography. The tax returns also show Trump has written off expenses related to travel from his different homes and properties, including meals and aircraft fuel, as well as grooming costs — he wrote off the more than $70,000 he spent on his hair while working on his reality show The Apprentice, the Times reports.

The IRS says legal fees can be deducted when they are "directly related to operating your business," but this does not include "legal fees paid to defend charges that arise from participation in a political campaign." Nevertheless, Trump's tax records show the Trump Corporation wrote off business expenses paid to Alan Futerfas, a criminal defense lawyer who was hired to represent Trump's eldest son, Donald Trump Jr., during the inquiry into Russian meddling in the 2016 presidential election, the Times reports.

This was in relation to investigators looking into Trump Jr.'s role in setting up a 2016 meeting at Trump Tower where Russians promised to provide damaging information on Hillary Clinton, and when Trump Jr. testified before Congress in 2017, Futerfas was with him. Futerfas, who additionally represented Trump's now-shuttered charitable foundation, received at least $1.9 million in 2017 and 2018 from the Trump Corporation, the Times reports, and the business also wrote off the $259,684 it paid Williams & Jensen, a second law firm hired to represent Trump Jr. Read more at The New York Times. Catherine Garcia

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