Trump blasts release of 2005 tax form

2017-03-15 21:52
(Pablo Martinez Monsivais, AP)

(Pablo Martinez Monsivais, AP)

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Washington - President Donald Trump earned $153m and paid $36.5m in income taxes in 2005, paying a roughly 25% effective tax rate thanks to a tax he has since sought to eliminate, according to newly disclosed tax documents.

The pages from Trump's federal tax return show the real estate mogul also reported a business loss of $103m that year, although the documents don't provide detail. The forms show that Trump paid an effective tax rate of 24.5%, a figure well above the roughly 10% the average American taxpayer forks over each year, but below the 27.4% that taxpayers earning $1m a year average were paying at the time, according to data from the Congressional Joint Committee on Taxation.

Received the returns

The tax form was obtained by Pulitzer prize-winning journalist David Cay Johnston, who runs the website DCReport.org, and reported on MSNBC's "The Rachel Maddow Show." Johnston, who has long reported on tax issues, said he received the documents in the mail, unsolicited.

Trump took to Twitter early on Wednesday to cast doubt on Johnston's account.

Johnston, speaking to ABC's "Good Morning America" on Wednesday, said it's entirely possible that he received the returns from Trump himself or someone close to him, saying, "Donald has a long history of leaking things about himself."

He noted that the real question remains the sources of Trump's income, saying Trump doesn't want us to know "who he's beholden to."

Trump's hefty business loss appears to be a continued benefit from his use of a tax loophole in the 1990s, which allowed him to deduct his creditors' losses on Trump's failing casinos as his own business losses, which Trump then used to offset his personal taxes in future years. In 1995, Trump reported a loss of more than $900m - an amount that had dwindled to $103m by the 2005 filing.

Tax records obtained by The New York Times last year showed the losses were so large they could have allowed Trump to avoid paying taxes for up to 18 years. But Trump's 2005 filing shows that another tax prevented him from realising the full benefit of those deductions.

The bulk of Trump's tax bill that year was due to the Alternative Minimum Tax, a tax aimed at preventing high-income earners from paying minimal taxes.

Claimed under audit

The AMT requires many taxpayers to calculate their taxes twice - once under the rules for regular income tax and then again under AMT - and then pay the higher amount. Critics say the tax has ensnared more middle-class people than intended, raising what they owe the federal government each year.

Were it not for the AMT, Trump would have avoided all but a few million dollars of his 2005 tax bill.

Trump's campaign website called for the end of the AMT, which is expected to bring in more than $350bn in revenues from 2016 to 2025.

As a candidate and as president, Trump has refused to release his tax returns, breaking a decades-long tradition. Although he initially promised to do so, he later claimed he was under audit by the Internal Revenue Service and said his attorneys had advised against it - though experts and IRS officials said such audits don't bar taxpayers from releasing their returns.

The White House pushed back even before the release of the documents on Tuesday night, saying that publishing the information was illegal.

Trump long insisted the American public wasn't interested in his returns and said little could be learned from them. But Trump's full returns would contain key details about things like his charitable giving, his income sources, the type of deductions he claimed, how much he earned from his assets and what strategies Trump used to reduce his tax bill.



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