According to a New York Times report, Donald Trump, a literal billionaire, paid a measly $750 in federal income tax the year he entered the White House. The report further detailed that in 10 of the previous 15 years the Times reviewed, due to colossal losses, Trump paid no income taxes at all.
This news has come as a shock to many, who weren’t aware of the depth of Trump’s business ineptitude, and who also questioned the legality of such a low federal tax payment.
It’s especially shocking when you juxtapose the reality of Trump’s tax payments with his comments in 2011 that lower-income Americans should pay taxes to be “part of the game.” He explained, “The amazing thing is that half of the country is paying nothing. Zero… And even if you don’t make a lot, you should have to pay something. Just something to be a part of the game. Half of the country’s paying nothing.”
Of course, it turns out that Trump was part of the country paying nothing. Zero.
Many have spoken up including waitresses, freelance writer, bus drivers, and so on, to respond with outrage to the fact that they are paying more taxes than Donald Trump, a billionaire.
Alexandria Ocasio-Cortez tweeted, “In 2016 & ‘17, I paid thousands of dollars a year in taxes *as a bartender.* Trump paid $750. He contributed less to funding our communities than waitresses & undocumented immigrants. Donald Trump has never cared for our country more than he cares for himself. A walking scam.”
The revelation of how low Trump’s tax payments were has been shocking not only because of what it implies about our president, but also because of what it implies about the American tax system as a whole.
If there are enough loopholes in the tax code that the rich can get away with paying only $750, the system is clearly flawed, leaving supporting our country up to low and middle income Americans. In the past it’s been noted that the tax system is specifically set up to screw poor Americans.
According to ProPublica. the IRS admitted that they audit poor taxpayers at a higher rate because “auditing poor taxpayers is a lot easier.” People in the lowest income bracket, of less than $20,000 a year are audited at 1.41% which is almost the same rate as people in the top 1% who are audited at a rate of 1.56%. This also means that poor tax payers have an audit rate that is more than 50% higher than the overall audit rate.
This system discourages poorer tax payers from taking exemptions that are the bread and butter of rich tax payers.
Trump has written off extravagant expenses, like the $70,000 he spent on hair styling during “The Apprentice,” vacation homes, private jets, and more as business expenses, deducting them from his taxes. One such item was his $2.2 million estate in Westchester County which he was able to fully write off as an “investment property.”
Meanwhile, the tax overhaul signed into law by Trump in 2017 limits taxpayers to only $10,000 in deductions from state and local taxes.
It’s also believed he’s been paying his family in consulting fees, which he writes off as a business expense. Paying people as independent contractors, when they are in fact not, is something that the IRS has leveled penalties for in the past.
Trump is currently under investigation by the IRS for a $72.9 million tax refund he received, which if they find it to be illegitimate, could result in Trump paying $100 million to them. He’s not in a good position to pay that large sum off, considering his tax reports revealed that he is responsible for $421 million in loans, most of which will be due in the next 4 years while a $100 million mortgage on Trump Tower in New York will be due in 2022.
Trump called the report, “totally fake news” in a press conference explaining, “The IRS does not treat me well… You have people in the IRS that treat me very, very badly.”
Meanwhile, Trump’s former lawyer Michael Cohen commented, “His biggest fear is, if that tax return was released, there’s a whole slew of accountants and forensic accountants that will rip through it and he will end up with a massive tax bill, penalties, fines and possibly even tax fraud.” It’s too soon to tell what the legal implications of this report will be.