How Much Does Donald Trump Pay in Taxes? It Could Be Zero
By JAMES B. STEWART AUG. 11, 2016
nytimes.com
Mitt Romney was excoriated during the 2012 presidential campaign for paying $4.9 million in federal income tax, or an average of just 14 percent of his adjusted gross income, in the two years for which he released returns.
No one should be surprised, though, if Donald J. Trump has paid far less — perhaps even zero federal income tax in some years. Indeed, that’s the expectation of numerous real estate and tax professionals I’ve interviewed in recent weeks.
Even with hundreds of millions in gross revenue from his vast real estate empire, “it’s both possible and legal that Donald Trump would pay little or no income tax,” said Len Green, an accountant and chairman of the Green Group, a tax and accounting advisory firm. Mr. Green is also a real estate investor, teaches at Babson College and is the author of the forthcoming “The Entrepreneur’s Playbook.”
“I would expect he’s paying little or no tax,” agreed Steven M. Rosenthal, a veteran tax lawyer and senior fellow at the Urban-Brookings Tax Policy center.
That’s because Mr. Trump, as a prominent and active developer, can take advantage of some of the most generous tax breaks in the federal tax code to reduce his reported income to near zero, or even report a loss.
Few tax advisers to major real estate developers would speak for attribution, because their clients benefit from the same tax breaks available to Mr. Trump. But all told me they knew developers in Mr. Trump’s league who pay little or no income tax despite hundreds of millions in cash flow.
“Real estate is notorious for throwing off huge deductions,” Mr. Rosenthal said. “That coupled with wide latitude in the timing and recognition of income make real estate development extremely attractive from a tax standpoint.”
The Trump campaign did not respond to requests for comment, nor did William F. Nelson, a former general counsel to the Internal Revenue Service and partner at Morgan, Lewis & Bockius, one of Mr. Trump’s tax lawyers.
Mr. Trump has said in the past that highly paid corporate executives “get away with murder” on their taxes while boasting that he pays as little as the law allows. At the same time, he has insisted that his federal income tax payments are “substantial.”
No one I spoke to has seen Mr. Trump’s tax returns, because he has not released them. One obvious potential reason is that he reports little or no taxable income, and thus pays very little to support the government he wants to run. He is not obligated by law to make his returns public, but every candidate since Richard Nixon refused to has done so. (Gerald Ford released summaries.) Mr. Romney was harshly criticized for releasing just two years’ worth, and it became a major campaign issue four years ago.
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