Trump’s predecessors released theirs to help promote bi-partisan transparency and good government in the post-Watergate era. He had no interest in any of that when he landed in the White House, and relied on a litany of howlers, including his claim was being audited, to explain his recalcitrance.
What a fine mess he has gotten himself into. There are certainly more surprises to come, but a pair of summaries of the House Ways and Means Committee’s analysis of Trump’s personal and business tax records from 2015 through 2020 contained interesting revelations that will trouble the former president and certainly draw the attention of prosecutors. One of the reports also details what appears to be a glaring institutional failure by the Internal Revenue Service to undertake mandated audits of his returns. The documents also show that during one year of his presidency, Trump — a self-proclaimed billionaire — paid no personal income taxes at all.
The records question the validity of about $300 million in tax deductions claimed by a skein of Trump holding companies for such write-offs as charitable giving, operating losses and business expenses. Both reports speculate that substantial sums were given to his three eldest children as gifts, but may have been disguised as loans to avoid tax payments. And one of the reports shows that a mandatory audit of Trump’s returns only occurred in one of the six tax years that should have been scrutinized.
The IRS instituted mandated audits of presidential tax returns in 1977 in response to a tax scandal that ensnared former President Richard Nixon. The mandate was seen as a way of insulating the IRS from political pressure and criticism by simply making audits automatic and annual. Yet only one was triggered during Trump’s presidency, begging the question of whether the White House corrupted the IRS.
That Trump has avoided paying taxes and engaged in questionable practices is hardly new. The New York Times detailed his machinations in a series of landmark articles in 2020 that congressional investigators relied on in their own probes. I saw Trump’s federal tax returns about 15 years ago as part of a legal action in which he unsuccessfully sued me for libel for a biography I wrote (the suit was later dismissed).
What is new is the extent to which Trump and his cohorts may have run roughshod over institutional checks and balances designed to prevent presidents from grifting while in office — and to also help ensure that financial conflicts of interest don’t collide with sound public-policymaking . There is also fresh detail in the reports that is likely to deepen the public’s understanding of just how fast and loose Trump was with the tax rules that average Americans are expected to adhere to and which he disdained.
The tax disclosures will inevitably be painted as the partisan handicraft of Democratic hacks only interested in embarrassing or defanging a potent political opponent. The same argument has been trotted out repeatedly to taint the work of the January 6 committee. Had Republicans been more willing to compel Trump to comply with the traditions and requirements of tax disclosures, it would have been harder to label the House Ways and Means efforts as partisan. But his party chose to acquiesce.
The reality is that every president should be transparent about their finances and Trump chose not to be. Consequences came with that decision, as they should have.
The framers of the Constitution and subsequent political leaders in the US left the presidency free of strict conflict of interest rules so as not to curtail the powers of the office. None of them, however, envisioned someone with Trump’s finances, moral ambiguity and appetites landing in the White House. An update of financial disclosure rules is long overdue, and if a collision over Trump’s taxes helps clarify the matter, so be it. (Clarity may be the best we get for the time being; the House is about to change hands, so any recommendations on the current leadership makes will be short-lived.)
Besides, Trump has provided ample fodder for making tax disclosure rules stricter and more universal. He never authentically distanced himself from his businesses while he was president and he surrounded himself with like-minded advisers. Shortly after Trump left office, his son-in-law, Jared Kushner, and his former Treasury Secretary, Steven Mnuchin, successfully rang up the Saudis and other overseas investors for billions of dollars in investment funds. There are still unanswered questions about the extent to which Trump himself was financially beholden to foreign powers before and during his presidency.
As more information about his finances surfaces in coming days, it will be a reminder of the extent to which the former president played a shell game with his wealth and business interests while in power — and what he might try to get away with again if he occupy the Oval Office in the future. Finding ways to curtail that kind of grifting isn’t partisan; it’s just good government.
More From Bloomberg Opinion:
• I’ve Seen Trump’s Tax Returns and You Should, Too: Timothy O’Brien
• I Saw Trump’s Tax Returns. You Should, Too: Timothy O’Brien
• Jan. 6 Panel Makes Trump Prosecution Imperative: Timothy O’Brien
(Corrects the fourth paragraph in column published Dec. 21 to more accurately describe how much money Trump may have given his children.)
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Timothy L. O’Brien is senior executive editor of Bloomberg Opinion. A former editor and reporter for the New York Times, he is author of “TrumpNation: The Art of Being the Donald.”
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