Donald Trump paid $750 (£581,13) in federal income taxes the year he won the presidency. In his first year in the White House, he paid another $750 (£581,13).
As the president wages a reelection campaign that polls say he is in danger of losing, his finances are under stress, beset by losses and hundreds of millions of dollars in debt coming due that he has personally guaranteed.
Also hanging over him is a decade long audit battle with the Internal Revenue Service over the legitimacy of a $72.9 (£56,5) million tax refund that he claimed, and received, after declaring huge losses. An adverse ruling could cost him more than $100 (£77,5) million.
The tax returns that Trump has long fought to keep private tell a story fundamentally different from the one he has sold to the American public. His reports to the IRS portray a businessman who takes in hundreds of millions of dollars a year yet racks up chronic losses that he aggressively employs to avoid paying taxes.
Now, with his financial challenges mounting, the records show that he depends more and more on making money from businesses that put him in potential and often direct conflict of interest with his job as president.
The New York Times has obtained tax-return data extending over more than two decades for Trump and the hundreds of companies that make up his business organisation, including detailed information from his first two years in office. It does not include his personal returns for 2018 or 2019. This article offers an overview of The Times’ findings; additional articles will be published in the coming weeks.
The returns are some of the most sought-after, and speculated-about, records in recent memory. In Trump’s nearly four years in office – and across his endlessly hyped decades in the public eye – journalists, prosecutors, opposition politicians and conspiracists have, with limited success, sought to excavate the enigmas of his finances.
By their very nature, the filings will leave many questions unanswered, many questionnaires unfulfilled. They comprise information that Trump has disclosed to the IRS, not the findings of an independent financial examination. They report that Trump owns hundreds of millions of dollars in valuable assets, but they do not reveal his true wealth. Nor do they reveal any previously unreported connections to Russia.
In response to a letter summarising The Times’ findings, Alan Garten, a lawyer for the Trump Organisation, said that “most, if not all, of the facts appear to be inaccurate” and requested the documents on which they were based. After The Times declined to provide the records, in order to protect its sources, Garten took direct issue only with the amount of taxes Trump had paid.
“Over the past decade, President Trump has paid tens of millions of dollars in personal taxes to the federal government, including paying millions in personal taxes since announcing his candidacy in 2015,” Garten said in a statement.
With the term “personal taxes,” however, Garten appears to be conflating income taxes with other federal taxes Trump has paid – Social Security, Medicare and taxes for his household employees. Garten also asserted that some of what the president owed was “paid with tax credits,” a misleading characterisation of credits, which reduce a business owner’s income-tax bill as a reward for various activities, like historic preservation.
The tax data examined by The Times provides a road map of revelations, from write-offs for the cost of a criminal defense lawyer and a mansion used as a family retreat to a full accounting of the millions of dollars the president received from the 2013 Miss Universe pageant in Moscow.
Together with related financial documents and legal filings, the records offer the most detailed look yet inside the president’s business empire. They reveal the hollowness, but also the wizardry, behind the self-made-billionaire image – honed through his star turn on “The Apprentice” — that helped propel him to the White House and that still undergirds the loyalty of many in his base.
Ultimately, Trump has been more successful playing a business mogul than being one in real life.
“The Apprentice,” along with the licensing and endorsement deals that flowed from his expanding celebrity, brought Trump a total of $427.4 (£331,2) million, The Times’ analysis of the records found. He invested much of that in a collection of businesses, mostly golf courses, that in the years since have steadily devoured cash – much as the money he secretly received from his father financed a spree of quixotic overspending that led to his collapse in the early 1990s.
Indeed, his financial condition when he announced his run for president in 2015 lends some credence to the notion that his long-shot campaign was at least in part a gambit to reanimate the marketability of his name.
As the legal and political battles over access to his tax returns have intensified, Trump has often wondered aloud why anyone would even want to see them. “There’s nothing to learn from them,” he told The Associated Press in 2016. There is far more useful information, he has said, in the annual financial disclosures required of him as president — which he has pointed to as evidence of his mastery of a flourishing, and immensely profitable, business universe.
In fact, those public filings offer a distorted picture of his financial state, since they simply report revenue, not profit. In 2018, for example, Trump announced in his disclosure that he had made at least $434.9 (£336,9) million. The tax records deliver a very different portrait of his bottom line: $47.4 (£36,8) million in losses.
Tax records do not have the specificity to evaluate the legitimacy of every business expense Trump claims to reduce his taxable income – for instance, without any explanation in his returns, the general and administrative expenses at his Bedminster golf club in New Jersey increased fivefold from 2016 to 2017.
And he has previously bragged that his ability to get by without paying taxes “makes me smart,” as he said in 2016. But the returns, by his own account, undercut his claims of financial acumen, showing that he is simply pouring more money into many businesses than he is taking out.
The picture that perhaps emerges most starkly from the mountain of figures and tax schedules prepared by Trump’s accountants is of a businessman-president in a tightening financial vice.
Most of Trump’s core enterprises – from his constellation of golf courses to his conservative-magnet hotel in Washington – report losing millions, if not tens of millions, of dollars year after year.
His revenue from “The Apprentice” and from licensing deals is drying up, and several years ago he sold nearly all the stocks that now might have helped him plug holes in his struggling properties.
The tax audit looms.
And within the next four years, more than $300 (£232,4) million in loans – obligations for which he is personally responsible – will come due.
Against that backdrop, the records go much further toward revealing the actual and potential conflicts of interest created by Trump’s refusal to divest himself of his business interests while in the White House.
His properties have become bazaars for collecting money directly from lobbyists, foreign officials and others seeking facetime, access or favor; the records for the first time put precise dollar figures on those transactions.
At the Mar-a-Lago club in Palm Beach, Florida, a flood of new members starting in 2015 allowed him to pocket an additional $5 (£3,8) million a year from the business. In 2017, the Billy Graham Evangelistic Association paid at least $397,602 (£308,08) to the Washington hotel, where the group held at least one event during its four-day World Summit in Defense of Persecuted Christians.
The Times was also able to take the fullest measure to date of the president’s income from overseas, where he holds ultimate sway over American diplomacy. When he took office, Trump said he would pursue no new foreign deals as president. Even so, in his first two years in the White House, his revenue from abroad totalled $73 (£56,6) million.
And while much of that money was from his golf properties in Scotland and Ireland, some came from licensing deals in countries with authoritarian-leaning leaders or thorny geopolitics – for example, $3 (£2.3) million from the Philippines, and $2.3 (£1.8) million from India.
He reported paying taxes, in turn, on a number of his overseas ventures. In 2017, the president’s $750 (£581.13) contribution to the operations of the U.S. government was dwarfed by the $15,598 (£12, 090) he or his companies paid in Panama, the $145,400 (£112.660) in India and the $156,824 (£121.510) in the Philippines.
Trump’s US payment, after factoring in his losses, was roughly equivalent, in dollars not adjusted for inflation, to another presidential tax bill revealed nearly a half-century before. In 1973, The Providence Journal reported that, after a charitable deduction for donating his presidential papers, Richard Nixon had paid $792.81 (£614,30) in 1970 on income of about $200,000 (£154,970).
The leak of Nixon’s small tax payment caused a precedent-setting uproar: Henceforth, presidents, and presidential candidates, would make their tax returns available for the American people to see.
The contents of thousands of personal and business tax records fill in financial details that have been withheld for years.
“I would love to do that,” Trump said in 2014 when asked whether he would release his taxes if he ran for president. He’s been backpedaling ever since.
When he ran, he said he might make his taxes public if Hillary Clinton did the same with the deleted emails from her private server – an echo of his taunt, while stoking the birther fiction, that he might release the returns if President Barack Obama released his birth certificate. He once boasted that his tax returns were “very big” and “beautiful.” But making them public? “It’s very complicated.”
He often claims that he cannot do so while under audit – an argument refuted by his own IRS commissioner. When prosecutors and congressional investigators issued subpoenas for his returns, he wielded not just his private lawyers but also the power of his Justice Department to stalemate them all the way to the Supreme Court.
Trump’s elaborate dance and defiance have only stoked suspicion about what secrets might lie hidden in his taxes. Is there a financial clue to his deference to Russia and its president, Vladimir Putin? Did he write off as a business expense the hush-money payment to the pornographic film star Stormy Daniels in the days before the 2016 election? Did a covert source of money feed his frenzy of acquisition that began in the mid-2000s?
The Times examined and analysed the data from thousands of individual and business tax returns for 2000 through 2017, along with additional tax information from other years. The trove included years of employee compensation information and records of cash payments between the president and his businesses, as well as information about ongoing federal audits of his taxes. This article also draws upon dozens of interviews and previously unreported material from other sources, both public and confidential.
All of the information The Times obtained was provided by sources with legal access to it. While most of the tax data has not previously been made public, The Times was able to verify portions of it by comparing it with publicly available information and confidential records previously obtained by The Times.
To delve into the records is to see up close the complex structure of the president’s business interests – and the depth of his entanglements. What is popularly known as the Trump Organisation is in fact a collection of more than 500 entities, virtually all of them wholly owned by Trump, many carrying his name. For example, 105 of them are a variation of the name Trump Marks, which he uses for licensing deals.
Fragments of Trump’s tax returns have leaked out before.
Transcripts of his main federal tax form, the 1040, from 1985 to 1994, were obtained by The Times in 2019. They showed that, in many years, Trump lost more money than nearly any other individual American taxpayer. Three pages of his 1995 returns, mailed anonymously to The Times during the 2016 campaign, showed that Trump had declared losses of $915.7 (£709.5) million, giving him a tax deduction that could have allowed him to avoid federal income taxes for almost two decades.
Five months later, the journalist David Cay Johnston obtained two pages of Trump’s returns from 2005; that year, his fortunes had rebounded to the point that he was paying taxes.
The vast new trove of information analysed by The Times completes the recurring pattern of ascent and decline that has defined the president’s career. Even so, it has its limits.
Tax returns do not, for example, record net worth – in Trump’s case, a topic of much posturing and almost as much debate. The documents chart a great churn of money, but while returns report debts, they often do not identify lenders.
The data contains no new revelations about the $130,000 (£100, 730) payment to Stephanie Clifford, the actress who performs as Stormy Daniels — the focus of the Manhattan district attorney’s subpoena for Trump’s tax returns and other financial information. Trump has acknowledged reimbursing his former lawyer, Michael Cohen, who made the payoff, but the materials obtained by The Times did not include any itemised payments to Cohen. The amount, however, could have been improperly included in legal fees written off as a business expense, which are not required to be itemised on tax returns.
No subject has provoked more intense speculation about Trump’s finances than his connection to Russia. While the tax records revealed no previously unknown financial connection – and, for the most part, lack the specificity required to do so — they did shed new light on the money behind the 2013 Miss Universe pageant in Moscow, a subject of enduring intrigue because of subsequent investigations into Russia’s interference in the 2016 election.
The records show that the pageant was the most profitable Miss Universe during Trump’s time as co-owner and that it generated a personal payday of $2.3 (£1.78) million – made possible, at least in part, by the Agalarov family, who would later help set up the infamous 2016 meeting between Trump campaign officials seeking “dirt” on Hillary Clinton and a Russian lawyer connected to the Kremlin.
In August, the Senate Intelligence Committee released a report that looked extensively into the circumstances of the Moscow pageant and revealed that as recently as February, investigators subpoenaed Russian singer Emin Agalarov, who was involved in planning it. Agalarov’s father, Aras, a billionaire who boasts of close ties to Putin, was Trump’s partner in the event.
The committee interviewed a top Miss Universe executive, Paula Shugart, who said the Agalarovs offered to underwrite the event; their family business, Crocus Group, paid a $6 (£4.6) million licensing fee and another $6 (£4.6) million in expenses. But while the pageant proved to be a financial loss for the Agalarovs – they recouped only $2 (£1.5) million – Shugart told investigators that it was “one of the most lucrative deals” the Miss Universe organisation ever made, according to the report.
That is borne out by the tax records. They show that in 2013, the pageant reported $31.6 (£24.5) million in gross receipts – the highest since at least the 1990s – allowing Trump and his co-owner, NBC, to split profits of $4.7 (£3.6) million. By comparison, Trump and NBC shared losses of $2 (£1.5) million from the pageant the year before the Moscow event, and $3.8 (£2.9)million from the one the year after.