"Horrible Things for So Many People"

December 30, 2022 9:19 AM

Trump Tax Returns (WaPo gift) released (NYT gift) by the House Ways and Means Committee (CNBC) (.pdfs via Axios, analysis and .zip via the House).

What do they show (BBC)? Questionable claims (CNN), and that he really, really should have been audited (The Atlantic).

posted by box (39 comments total)

(On the title (The Hill) of this post)
posted by box at 9:19 AM on December 30, 2022

The damnedest thing is that I don't know what difference this would have made after Trump was in the game for a while, and it's because his tactics worked. Initially, before he and the alt-right machine behind him destroyed the meaning of truth in the electoral sphere, they would have been embarrassing. After that, probably even before the 2016 election, it would have been something he could hand-wave away as good business. He probably could have even said "Only the little people pay taxes," just like Leona Helmsley, and gotten the votes of those same people just as well. But if Trump were a man who could strategize and maybe give way once in one regard to gain more in another, history would be very different.
posted by Countess Elena at 9:31 AM on December 30, 2022 [4 favorites]

"Republicans warned that the release of a private individual’s tax returns would set a dangerous precedent and lead to public pressure for G.O.P. lawmakers to respond by releasing other sets of tax returns once they take control of the House next week." (from WaPo)

Good. Every Congressperson should have transparent finances. Release them all. WTF.

"In a closed-door hearing last week that preceded the party-line vote to release Mr. Trump’s returns, Republicans specifically raised the possibility of releasing tax information related to President Biden’s family — most likely including his son Hunter Biden."

Oh, I see, this is more of that. I don't care about Hunter Biden but the government shouldn't be releasing tax returns for private individuals. Any money Joe gives Hunter (or anybody) should be public record already, right?
posted by joannemerriam at 9:31 AM on December 30, 2022 [38 favorites]

Let's remember that, following the tradition of every modern presidential candidate & president except for Trump, Joe Biden already released his tax returns from 2016-2021. Threatening to release Hunter's tax returns is meant to obfuscate that.
posted by muddgirl at 9:42 AM on December 30, 2022 [47 favorites]

They’re going to use this as an excuse to do something they were going to do anyway, so just equip yourself to deal with your fascist uncle bringing it up on Facebook.
posted by Etrigan at 9:54 AM on December 30, 2022 [17 favorites]

Every person with a top secret clearance needs to have their finances checked. Hell I’ve had “three letter” agencies contact me about past coworkers for basic IT jobs. The person voted in to command the nuke fleet needs it to be publicly aired.

You know, to maybe ensure that they’re not compromised by a foreign agency.
posted by Abehammerb Lincoln at 10:01 AM on December 30, 2022 [25 favorites]

Merry dumpster fire day, everyone! Public financial humiliation is the second-best punishment I could imagine.

stolen from social media: this will be the most exciting New Years Eve for forensic accountants ever.
posted by Dashy at 10:03 AM on December 30, 2022 [6 favorites]

How confident can we be that these are not discretely sanitized or even entirely fabricated by Trump supporters in the IRS?
posted by CynicalKnight at 10:54 AM on December 30, 2022 [2 favorites]

So while his Presidential years returns don't have exactly 400k for wages and they were jointly filed, the numbers are similar all three years and makes me think that ol Donnie was lying about not taking a paycheck while President.
posted by 922257033c4a0f3cecdbd819a46d626999d1af4a at 10:54 AM on December 30, 2022

...makes me think that ol Donnie was lying about not taking a paycheck while President.

Of course he took a paycheck. Unlike any checks he might write, government checks actually clear.
posted by Thorzdad at 11:05 AM on December 30, 2022 [11 favorites]

How confident can we be that these are not discretely sanitized or even entirely fabricated by Trump supporters in the IRS?

By Trump supporters?

I mean, if that was the case you'd think they'd have put more effort into making them look legit and aboveboard - even the summary report issued by the House (what, a week ago?) made it clear there's some highly suspect shit in there. And AFAIK there's no requirement for House Ways and Means committee members to be accountants or tax experts, so who knows what actual experts will find going over the original documents.
posted by soundguy99 at 11:25 AM on December 30, 2022 [4 favorites]

Trump took paychecks, claimed he was donating them to charity, but doesn't appear to have done that (at least in 2020). Trump maintained foreign bank accounts in multiple countries (including China) during his term; in 2017 he paid nearly $1 million in taxes to other other countries, while paying "just $750 in US federal income taxes because of large carry-forward losses that he claimed in prior years". In the same year,

Trump claimed he received exactly $18,000 in interest on a loan he said he gave his daughter Ivanka Trump. He claimed $8,715 in interest from his son Donald Trump, Jr., and exactly $24,000 from his son Eric Trump. “It’s unusual to have interest in round numbers – very rare,” said Martin Sheil, former supervisory special agent for IRS’ Criminal Investigation unit. [...] Trump claimed his business DJT Aerospace LLC, which operates Trump’s personal helicopter, claimed $42,965 in profit. It also claimed the exact same amount – $42,965 – in expenses. In other words, every single dollar – to the dollar – that the company earned was negated by the company’s expenses, such as payroll, fuel and other items. That left the company with zero income – and nothing to tax.

“Total expenses equaling total income is a statistical impossibility,” said Shiel, who added that the figures are not evidence something illegal was done.

While it's believable he charged his kids interest on loans, he also cheated, cheated, cheated on his taxes.
posted by Iris Gambol at 11:45 AM on December 30, 2022 [24 favorites]

It's somewhat less believable that the interest they paid ended in $000.00.

I am eagerly anticipating when some experts take a deep dive into the returns--just based on what little is out there already, I'm pretty sure we are witnessing a freaking MasterClass of tax fraud.
posted by box at 11:51 AM on December 30, 2022 [3 favorites]

This is why Fox news was acting like the new IRS agents were the four horsemen of the apocalypse, because DJT is not the only person doing this.
posted by Selena777 at 12:13 PM on December 30, 2022 [19 favorites]

> Total expenses equaling total income is a statistical impossibility

Obviously not an accountant, but would it be abnormal for the LLC to bill based on cost? Nobody needs or wants that entity to turn a profit, right?
posted by Horselover Fat at 12:52 PM on December 30, 2022

On the other hand the interest from a loan from a loanshark ending in exactly $000.00 is practically the de facto norm.
posted by Mitheral at 1:04 PM on December 30, 2022

Trump's rat-king LLCs, from 2016, with chart: How Donald Trump’s Web of LLCs Obscures His Business Interests; The opacity of his holdings makes it impossible to gauge the full extent of potential conflicts he may face as president (WSJ, Dec. 8, 2016, archived link) President-elect Donald Trump owns a helicopter in Scotland. To be more precise, he has a revocable trust that owns 99% of a Delaware limited liability company that owns 99% of another Delaware LLC that owns a Scottish limited company that owns another Scottish company that owns the 26-year-old Sikorsky S-76B helicopter, emblazoned with a red “TRUMP” on the side of its fuselage. Ivanka Trump was the Executive Vice President of DJT Aerospace LLC until she left for the White House.
posted by Iris Gambol at 1:10 PM on December 30, 2022 [7 favorites]

Dangerous precedent / president.
posted by Oyéah at 2:44 PM on December 30, 2022 [4 favorites]

Nobody needs or wants that entity to turn a profit, right?

Profit-motive is the #1 definition of a business according to the IRS. If they don't want the entity to turn a profit, it's not a business and they can't deduct expenses at all...
posted by muddgirl at 3:11 PM on December 30, 2022 [5 favorites]

“Total expenses equaling total income is a statistical impossibility,” said Shiel, who added that the figures are not evidence something illegal was done

I'm having trouble reconciling the truth of these two mutually exclusive statements. But then everything the Trump crime family does is based on lies, so whatever.
posted by They sucked his brains out! at 4:33 PM on December 30, 2022 [3 favorites]

Rich people should never have to suffer consequences. Otherwise, what's the point of being rich? Just drinking the tears of the peasantry and bathing in virgin blood?
posted by Jacen at 4:36 PM on December 30, 2022 [3 favorites]

Is it because you can claim ignorance of a rule, or that you had a bad day, or that you accidentally wrote the wrong thing, or that you solemnly swear that you didn’t write the thing and you don’t know how it got there… is it because you can lie your way out of it that it may not be illegal?
posted by Glinn at 4:41 PM on December 30, 2022

“Total expenses equaling total income is a statistical impossibility,” said Shiel, who added that the figures are not evidence something illegal was done

I'm having trouble reconciling the truth of these two mutually exclusive statements.

This is an interview with a former IRS investigator - he most probably means "evidence" in the sense of provable in court "here are the receipts from the stuff you spent money on & claimed as expenses and it doesn't add up to $42,695 especially because this, this and this are not legitimate business expenses." Statistical impossibility is not actually "proof."
posted by soundguy99 at 4:47 PM on December 30, 2022 [3 favorites]

Profit-motive is the #1 definition of a business according to the IRS. If they don't want the entity to turn a profit, it's not a business and they can't deduct expenses at all...

Maybe, but lots of businesses don't return profits every year, because plenty of business men (especially small businesses) are not very competent. Also, " It also claimed the exact same amount – $42,965 – in expenses." is not particularly weird or difficult for small businesses, as many make year-end purchases because managing taxes is something small businesses do, so a former IRS agent calling it a 'statistical impossibility' is not particularly accurate. Of course, most people don't make them match exactly because small business are concerned of the likelihood of being audited, which is apparently something Trump doesn't worry about, due to his business' size.

Also $42k in expenses is a small business.
posted by The_Vegetables at 5:46 PM on December 30, 2022 [1 favorite]

Maybe, but lots of businesses don't return profits every year, because plenty of business men (especially small businesses) are not very competent.

Also the IRS profit thing is mostly to distinguish hobbies that one doesn't do professionally from actual businesses. Like I can't pretend I'm a down on my luck musician and write off all my guitar purchases without showing some evidence that I'm actually trying to be a professional musician. None of this applies to Trump.
posted by The_Vegetables at 5:57 PM on December 30, 2022 [2 favorites]

If the helicopter, pilot, etc. are paid with after-tax money, employees' incomes are reported and tax withheld, and the "business" isn't being used to gift services to others at below-market rates, I don't see an issue with the LLC's income exactly equaling cost. This seems equivalent to what I understand is a fairly common setup used to pay household employees above board.

The loan interest stuff is definitely suspicious, though.
posted by dsword at 6:02 PM on December 30, 2022 [1 favorite]

I don't think it is above-board to claim household employees wages as a business expense either.
posted by muddgirl at 6:37 PM on December 30, 2022 [1 favorite]

If you want to pay your share of your employees' payroll taxes, report their income and withhold income tax, a way to do that is to set up a business. The only income your after-tax payment, which is then taxed again as the employee's income. But you don't have to pay business tax on top of it.
posted by dsword at 6:54 PM on December 30, 2022

For convenience you may be able to process payroll for household employees through an existing business but it does not constitute a business activity or show up on a Schedule C or a business tax return.

Trump's private helicopter for personal use seems more like a chauffeur which is a household employee, not a separate business. Yes some businesses are incompetently run and/or may show losses year after year but the *purpose* of the business still needs to be to generate profit. So a badly run laundromat may be a business, that doesn't mean I can call my personal washer and dryer a laundry business in order to write off the cost of the machines and laundry soap.
posted by muddgirl at 10:15 PM on December 30, 2022 [1 favorite]

Statistical impossibility is not actually "proof."

Because I work with statistics for a living, when someone uses my language to state that something is impossible, that should even be beyond the ability of legal gymnastics to invent into existence. *shrug*
posted by They sucked his brains out! at 11:33 PM on December 30, 2022 [2 favorites]

muddgirl, I think that's exactly right that it's not a "business." But, for tax compliance purposes, it can look like one on paper. Certain services individuals provide as "independent contractors." These individuals are required to manage their tax liability, um, independently. You just pay them and don't have to worry about it. The IRS says some services don't count. Childcare in your own home is one. (Roughly, if you're directing the work to be done and you pay more than a certain amount per year, you're considered an employer for tax purposes.) In this case, you need to file a whole other set of tax forms, get an EIN (line an SSID) from the government, etc., pay state and local taxes, unemployment insurance... stuff that isn't on individual tax return documents. It looks and feels very much like a business on paper, but at the end of the year, income and expenses are exactly equal, because it's just what you have to do.

Now, if that involves just paying a nanny, forming an LLC may be going overboard. But if you have a helicopter, it might make perfect sense to set that up for insurance and all that. (A bit beyond my paygrade.)

I think a helicopter pilot is definitely going to want his income to be above board, reported, etc. Especially if, say, life insurance is part of the compensation. So it's hard to imagine Trump avoiding something like this unless he's willing to give up ownership of the chopper and pay charter prices. (Akin to going cab vs personal driver in your own town car).

My understanding is there are tons of "businesses" in the U.S. that are really just people paying other people to do things for them, but the relationship is considered an official employment relationship, and they have to have taxes paid, paperwork filed, etc, and it's completely expected that these "businesses" have exactly matched income and expenses, because nobody but the proprietor is paying in (with after-tax money) and everything is being spent on expenses and employee taxes. It would be more unusual in my mind if they didn't balance.

I am not a tax expert. This is just what I've been told.
posted by dsword at 12:02 AM on December 31, 2022

I’m all about anything that might help put the man behind bars, but at this point the taxes thing seems just a little bit pointless and vindictive. What are we going to find out that we don’t already know? Especially for someone with trump’s record, I kinda feel like we might have bigger fish to fry.
posted by panama joe at 4:53 AM on December 31, 2022

at this point the taxes thing seems just a little bit pointless and vindictive

He's committed so, so, so many crimes. But what counts is prosecuting, obtaining a conviction which is neither overturned nor blithely pardoned by the next friendly administration, and seeing it carried out.

Tax crimes - where the money actually goes and how it is accounted for - might sometimes be the only crimes with clear evidence someone had to sign their name to, asserting it is accurate and truthful to the best of their knowledge. This makes them potentially tighter and more resilient against all the above. Also, it might be a little tougher to characterize such crimes in a political light that will earn a pardon. (again, a future administration may, as Trump did, choose to pardon as its own act of vengeance, you can't control that)

They got Al Capone on tax evasion after he got away with many, many murders.

But one thing: vindictive? as in a desire for revenge? Bringing an obvious and unrepentant fraud to justice isn't a matter of revenge, it's the only way you build and sustain a legal system in which anyone can have faith (or begin the hard work of rebuilding that faith in a system you want to return to respectability). Not prosecuting massive tax crimes bye public figures basically says (reiterates) that if you're rich enough the rules don't apply to you, ever and further erodes faith in what's left of that system.
posted by abulafa at 5:30 AM on December 31, 2022 [29 favorites]

"What are we going to find out that we don’t already know? "

But so many people just don't know, they are just not informed on any of this. (Way too many are very actively misinformed.) The more stuff like this hits the news, the more some small amount of awareness reaches more people.
posted by thefool at 6:05 AM on December 31, 2022 [1 favorite]

dsword, I think what you have been told is wrong or you are misunderstanding. Household employers report payroll taxes on either Schedule H or more rarely on 941 or 943 if they own a business and run their household employees through payroll. But none of these forms involve "zeroing out income with expenses".

There may be a lot of people committing small time tax fraud by claiming their personal chauffeur is actually running a business, I don't know about that. I know the IRS is overworked and under compensated and they can't chase every suspect business. But just because people do it, doesn't make it legal.
posted by muddgirl at 6:24 AM on December 31, 2022

Tax crimes - where the money actually goes and how it is accounted for - might sometimes be the only crimes with clear evidence someone had to sign their name to, asserting it is accurate and truthful to the best of their knowledge. This makes them potentially tighter and more resilient against all the above. Also, it might be a little tougher to characterize such crimes in a political light that will earn a pardon

Good point.

Not prosecuting massive tax crimes bye public figures basically says (reiterates) that if you're rich enough the rules don't apply to you, ever and further erodes faith in what's left of that system.

Yeah. And I get that. But at least from what we already know (e.g. the excellent reporting by NYT a couple years ago), it seems likely he just pulls the same old bullshit as every other billionaire — pays zero taxes, and probably most of it is legal. He’s also apparently really good at losing money, but we already knew that.

Happy to be proven wrong here, and again, I support any effort to put trump behind bars. I just remember the taxes thing was such a big deal for us at the time, but it kinda seems to pale in comparison to everything else he’s done since.

Ultimately I guess there’s no good reason not to chase down every possible lead. But I’m not really expecting too much here.
posted by panama joe at 6:28 AM on December 31, 2022

(Here's an article from a wealth manager that discusses owning yachts and jets under an LLC for "asset protection" and makes some of the same points that I have been making.)
posted by muddgirl at 7:37 AM on December 31, 2022

One of the things with TFG is he really isn't any sort of criminal mastermind nor dies he surround himself with people who are. And like Lester says " You follow drugs, you get drug addicts and drug dealers. But you start to follow the money, and you don't know where the fuck it's gonna take you. " TFG seems to only associate with shady characters. Going after his financials might root some of them out too. See for example the restrictions now in place on him or his kids running "charities" in NY. And making his records public puts thousands of eyes on these shady operations letting volunteers do the work the IRS can't do because it has been deliberately underfunded.
posted by Mitheral at 9:53 AM on December 31, 2022 [4 favorites]

muddgirl, yes I understand that. This is what I meant by saying "forming an LLC may be going overboard." Details vary by state. And I have no idea what requirements may apply to operating a personal aircraft.

If "DJT Aerospace LLC, which operates Trump’s personal helicopter" does that and only that, there's nothing odd about income equaling expenses... that's just balancing a ledger. He's just flying himself around at cost. No foul there. If it actually earns income from something else, that's a different story. It should be looked at in an audit, but it doesn't strike me as surprising or nefarious given the information provided.
posted by dsword at 10:45 AM on December 31, 2022