Economy & Politics

TaxesDonald Trump, the debt man

In the 2016 election campaign, Donald Trump promised to disclose his tax return. The US President is still keeping the documents under lock and keyimago images / Zuma Wire

Donald Trump’s finances should continue to provide plenty of talking point in the coming year – regardless of whether he wins the presidential election or not. Because according to the “New York Times” Trump has to struggle with at least financial challenges: his golf courses and hotels write losses year after year, loans in the millions will be due in the coming year and a dispute with the tax authority IRS could be very expensive for the president.

The lawsuit is about a tax refund of nearly $ 73 million. Trump received this in 2010. This is all of the federal income tax he paid between 2005 and 2007.

The background: In the USA companies can claim losses for tax purposes and partially offset them against profits made elsewhere. Until 2009 this was only possible for two years. Then, in the face of the deep recession sparked by the financial crisis, then-President Barack Obama signed a bill that extended the period to four years.

Trump took advantage of this and claimed a loss of $ 700 million retrospectively. According to the NYT, it is not clear from the documents available to it which business went wrong. Most likely it is about the bankruptcy of his Atlantic City casinos.

Losses in core business

In 2008, Trump did not pay any income tax, but after the change in the law, he was now able to claim back the money that he had transferred between 2005 and 2007. Whether he can keep it is open. In the opinion of the IRS, he did not meet an essential requirement for the tax refund: He would have had to give up his stake completely and no longer had to make a profit from it.

According to the NYT, however, Trump received a stake in the new company that had gone bankrupt and thus lost the right to claim the losses. If the authority prevails, Trump would have to pay more than $ 100 million, it said.

In addition, Trump’s core investments do not bring any money – on the contrary. Between 2000 and 2018, the losses of its golf departments totaled $ 315 million. His hotel in Washington is also in deficit.

In addition, more than $ 300 million in loans will fall due over the next four years – commitments for which Trump is personally liable, not his corporate network, according to the newspaper. Overall, Trump stands for $ 421 million in debt. And it’s unclear whether Trump is actually worth billions of dollars, as he claims.

Trump keeps his tax returns under lock and key, contrary to US presidential practice. He had not published his tax return during the 2016 election campaign, including reference to the ongoing IRS auditing. The tax authority itself emphasizes that an ongoing review does not stand in the way of publications.

Meanwhile, Trump is cursing the IRS. “You treat me terribly,” he said on a Fox News talk show in July. “It’s a shame”.

The article first appeared on ntv.de..

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