Key Takeaways From Trump's Tax Returns
That tax break is scheduled to expire at the end of 2025.
3. State and Local Tax Limit
Trump’s returns also reflect the $10,000 cap he and Republicans enacted in their 2017 tax law on the state and local tax, or SALT, deduction, negating millions he otherwise could have claimed each year from state and local taxes paid.
For 2019, Trump’s return says he paid $8.4 million in state and local taxes, but could only claim $10,000 under his tax law. The following year was similar: $8.5 million paid but again subject to the $10,000 limitation.
Trump’s $10,000 SALT deduction limitation curbed the tax breaks for many high-income taxpayers, and angered Democrats in high-tax states, including New York and New Jersey. Previously, the deduction was unlimited for some itemizing taxpayers.
4. Foreign Ties
As president, Trump was sued by congressional Democrats and Democratic attorneys general who accused him of violating the US Constitution’s so-called Emoluments Clause, barring presidents from receiving gifts from foreign governments.
The filings do little to clarify the nature and extent of Trump’s overseas financial links, but his 2020 return — from when he was running for re-election and facing questions about his relationship with foreign adversaries — lists several entities that operate in China including a Shenzhen hotel business.
Others of the hundreds of business entities listed also appear to operate abroad, including some in Panama, Brazil and Baku, Azerbaijan.
5. Charitable Gifts
Trump reported giving relatively little to charity while in the White House, including claiming no donations in 2020 at the height of the pandemic.
Trump gave the most while in office in 2017, when he gave nearly $1.9 million in cash. Trump gave about $500,000 in both 2018 and 2019.
Charitable giving was a sensitive subject while Trump was in office. He agreed to shut down his charity, the Trump Foundation, in 2018 after allegations that he was using the entity for his campaign and other personal pursuits.
6. Audit Risk
The non-partisan Congressional Joint Committee on Taxation has noted dozens of potential deductions and other maneuvers that would likely be raised during an audit.
The House Democrats found that the Internal Revenue Service didn’t complete an audit of Trump while he was in office, but the potential red flags raised by the Joint Committee could provide an audit map for the IRS if it pursues an examination.
Tax accountants have also noted that Trump’s use of sole proprietorship entities, which are usually used for small, single-person businesses such as hairdressers or lawn care providers, is also a potential audit trigger for the IRS.
(Photo: Al Drago/Bloomberg)
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