At last Monday’s first presidential debate, Donald Trump denied and rejected most of Hillary Clinton’s attacks.
When the former Secretary of State mentioned Mr. Trump’s 2004 comment that pregnancy “is an inconvenience for a person running a business”, Trump responded, “I never said that.” When Clinton told the audience, “Donald thinks that climate change is a hoax perpetrated by the Chinese,” Trump quickly retorted, “I do not say that.”
The concept of global warming was created by and for the Chinese in order to make U.S. manufacturing non-competitive. - Donald Trump, in a tweet dated Nov. 6th 2012
However, when Clinton referenced two decades-old tax returns of Trump’s that showed years in which he paid zero in federal income tax, Trump claimed, “That makes me smart.” When she further pressed the issue, insinuating Trump continued to withhold his tax returns from public scrutiny because they would reveal he continues to pay zero in federal income tax, Trump seemingly admitted to the charge.
It would be squandered, too, believe me. - Donald Trump, at the first presidential debate
You Say Loophole, I Say Existing Laws
Donald Trump has earned the great majority of his wealth from real estate development: the industry enjoys enormous tax benefits intended to help new projects succeed through the early years when major losses are sustained before profits are achievable.
Trump also owns a fleet of limited liability companies, and current tax law allows these entities to deduct the cost of the interest they pay on loans, a huge benefit in industries like real estate where debt financing is integral and substantial.
By generating enough losses on paper, and deducting the cost of interest across his holdings, Mr. Trump could conceivably shelter his diverse incomes from federal taxes.
Grover Norquist, a Trump supporter and president of Americans for Tax Reform, is quick to point out that, were this the case, Trump would be doing nothing except intelligently applying existing tax law, an echo of Trump’s sentiment: “That makes me smart.”
But to hear Clinton tell it:
If he’s paid zero, that means zero for troops, zero for vets, zero for school or health. - Hilary Clinton, at the first presidential debate
Trump claims he is unable to release his returns due to an ongoing audit, but agency officials at the Internal Revenue Service have made it clear that this restriction does not exist. If Trump continues to withhold his tax return, he will be the first nominee to do so since 1976 when Gerald Ford ran for the office. The Republican presidential nominee in 2012, Mitt Romney, who, like Trump, is notably wealthy, delayed releasing his tax returns before conceding to mounting pressure to do so. The release revealed he paid an effective tax rate of 14 percent.
Trump and Romney’s personal taxes aside, the existence of tax codes that would make such feats possible for the extremely wealthy should attract attention, debate and review in our nation’s current climate of economic inequality.