House Committee Releases Trump Tax Report; know more

The Democrat-led House Ways and Means Committee released a report on Donald Trump’s taxes on Tuesday after voting to make the former president’s tax returns public.

The panel passed a motion in a partisan vote to release the materials to the House, paving the way for Trump’s tax returns to be released publicly in a matter of days.

The vote passed with all Democrats voting in favor and all Republicans voting no.

The panel will also release all information from the President’s request Richard Neal to the IRS, which means it will include Trump’s tax returns from 2015 to 2020.

These underlying documents, however, will need to undergo significant redaction first.

The release of Trump’s tax returns marks the conclusion of a nearly four-year legal battle that House Democrats waged against the former president after they took control of Congress in 2019.

The audit program was important to Democrats because it was the rationale they used to get the returns in the first place — but the Democrat quest was also linked in part to long-standing suspicions about Trump’s taxes after he failed to release his returns. while running for president in 2016 or once in office.

The committee also made legislative recommendations to strengthen the presidential audit program, including new requirements “for mandatory review of the President with disclosure of certain audit information and related returns in a timely manner.”

Speaker of the House Nancy Pelosi announced that the House would “move quickly” to move the legislation forward, even though Congress is days away from adjourning.

In a separate report, the Joint Committee on Taxation offered a summary of its review of tax returns between 2015 and 2020 for Trump and several of his businesses.

The JCT noted in its report that it had no investigative powers — it could not demand documents from Trump or his businesses or interview IRS agents assigned to Trump’s audits — so the committee did not issue an opinion on whether Trump should have paid more or less. taxes.

Trump pattern

Evident in the tax information released in the report on Trump’s 2015-2020 tax returns is the former president’s pattern — as previously shown by a New York Times investigation — of generating huge net operating losses and then carrying them around for years afterward. to settle your tax debts.

For example, the JCT noted that Trump carried $105 million in losses in his 2015 comeback, $73 million in 2016, $45 million in 2017, and $23 million in 2018.

A spokesperson for former President Donald Trump accused House Democrats of playing politics by moving to release his tax returns to the public.

“This unprecedented leak by the idiot Democrats is proof that they are playing a political game they are losing,” said Trump’s spokesman, Steven Cheung 🇧🇷

He added: “If this injustice can happen to President Trump, it can happen to all Americans for no reason.”

The Ways and Means Committee report concluded that the IRS failed to audit Trump’s taxes as required by the mandatory presidential audit program.

The report found that Trump was only audited one year, from 2015 to 2020.

“The Committee’s investigation revealed that only one mandatory audit was initiated under the previous administration and the program was dormant at best,” the committee wrote in its 25-page report released Tuesday after the hearing.

The committee found that the IRS was under-resourced to handle the presidential audit program, recommending additional personnel, including “two senior IRS agents, a partnership specialist, a foreign specialist, and a financial products specialist.”

Neal also wouldn’t say if he saw any red flags in Trump’s taxes — either in his business or personal records. “I think we need to leave that to the tax people,” he said.

Republicans accuse Democrats of “weaponizing” tax information

the deputy Kevin Brady , the top Republican on the committee, lashed out at Democrats for arming Trump’s financial information. He said the committee voted to release Trump’s returns for six years, along with the returns of eight affiliated companies.

“What has become clear is that almost all of the audits the IRS is doing are not yet complete. So any characterization of the returns themselves, you have to recognize, that’s incomplete at this time,” Brady said.

The long-awaited meeting, which began publicly but quickly descended into private, closed session, took years to happen but comes when Democrats have just a few days to decide whether to release the former president’s tax returns.

While there is historical precedent for the Ways and Means Committee to release confidential tax information, the decision to release it to the public would carry intense political consequences, as Trump has already declared that he is running for president in 2024.

The committee had access to Trump’s taxes for weeks after winning a lengthy legal battle that began in the spring of 2019. Neal filed Trump’s first six years of taxes, as well as tax returns for eight of his businesses in April 2019.

Brady of Texas, the top Republican on the panel, told reporters shortly before Tuesday’s meeting that releasing Trump’s tax returns would amount to “a dangerous new political weapon that goes far beyond the former president and overturns decades of protections of privacy for ordinary Americans that have existed since Watergate reform”.

“We are united in our concern that Democrats may today move forward with unprecedented action that will jeopardize the right of every American to be protected from political attacks by Congress,” Brady said.

Democrats on the committee would rely on section 6103 of the tax code to legally release information about Trump’s taxes, but Republicans are prepared to argue that Democrats are abusing the provision, attacking a political enemy and potentially unleashing a system where even individuals can have their information exposed if they become targets of the committee.

charitable donations

The Joint Committee on Taxation also raised many questions about the validity of Trump’s claims on his tax returns. For example, Trump included many huge tax deductions for charitable donations that the JCT said deserved further investigation.

In 2015, Trump claimed a $21.1 million deduction for donating 158 acres of his 212-acre property called Seven Springs in North Castle, New York. The donation is included in the Manhattan District Attorney’s criminal investigation into the finances of the Trump Organization.

The report noted that an IRS agent assigned to audit Trump’s taxes suggested not allowing the entire $21.1 million deduction because Trump did not obtain a qualified appraisal for the land.

The agent alternatively suggested reducing the amount of the deduction by more than half and said the appraiser could be subject to a fine for potentially getting the land value wrong.

In 2016 and 2017, Trump claimed nearly $1.2 million and $1.9 million, respectively, in charitable contributions, most of which was cash. Trump had no taxable income in either year, but he was able to carry the deduction into future years, further limiting the amount of federal income tax he had to pay.

The JCT said the large cash contributions deserved a review.

Trump had taxable income in 2018 and 2019 and reported cash donations of just over $500,000 a year. This means that he was able to claim a charitable contribution deduction in those years.

The JCT suggested that Trump should be asked to prove these large cash donations.

historical precedent

When Neal requested Trump’s tax information in 2019, he wasn’t the first president to use a mysterious section of the tax code known as 6013 to obtain sensitive tax information.

The same statute was used several times by the Chairs of the Ways and Means Committee for Investigations and the Joint Taxation Commission (JCT) also used the statute to obtain information about former President Richard Nixon’s taxes in the 1970s.

According to the Chamber’s Means and Means Committee, this information was requested and received without a legal dispute.

Nixon voluntarily released some of his returns, but the JCT requested additional returns using 6103, according to a House Committee memo released earlier this summer. Republicans also used Statute 6103.

In 2014, the president, dave camp led the committee in releasing sensitive tax information to further the committee’s investigation into whether the IRS had unfairly targeted conservative organizations when deciding on groups to investigate.

What the public can learn

While The New York Times obtained decades of Trump’s 2020 personal tax information, Neal’s request could shed light on additional years of Trump’s finances and paint a picture of how the former president used his business entities and personal wealth in previous years and after becoming President.

Trump broke with tradition in 2016 by refusing to release any of his personal tax returns.

Democrats have long argued that Trump’s taxes could provide much-needed information about whether the president had any involvement that could affect his decision-making as president.

Democrats on the House Ways and Means Committee argued in court that they needed Trump’s tax returns so they could better understand the presidential audit program, which is supposed to routinely audit the returns of every new president and vice president when elected.

Neal, however, didn’t just request Trump’s gross tax return. Neal also requested administrative files and paperwork, items that could include notes from IRS officials or audits of Trump’s returns.

The information can portray what kind of scrutiny the IRS has conducted on Trump in the past and whether any of that scrutiny changed when he became president.

If the committee voted to make the information public, it could shed light on how rich Trump really is, how much he has donated to charity and how much he has paid in taxes.

The 2020 New York Times report made it clear that Trump carried business losses for years to be able to legally avoid paying taxes for many of those years, but the Ways and Means Committee will also have access to some additional Trump tax years.