The Sliver of Trump’s Tax Return That MSNBC Obtained Tells Us Almost Nothing About His Finances. Demand More.


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I woke up Tuesday morning planning to write yet another article on President Trump’s refusal to release his tax returns despite almost every other president and presidential candidate over the past 50 years having done so. Trump’s actions were troubling enough during the campaign, when his willingness to violate this norm set a dangerous precedent for future presidential contests. Now that he is president, that worry seems quaint. As Trump makes foreign and domestic policy decisions that impact us all, the public needs to understand where his loyalties lie, and how he might personally benefit from some of the decisions he makes. And absent his tax returns, we don’t.

On Tuesday evening, MSNBC began to tout what seemed to be a major scoop: It had a Trump tax return. The investigative journalist David Cay Johnston had received documents in the mail, and Rachel Maddow would tell all at the appointed hour. A previous leak during the campaign, to the New York Times, suggested that Trump had taken a $1 billion tax loss in the 1990s under circumstances that suggested aggressive tax planning at the best and flat-out cheating at the worst. However, we didn’t have the full returns to figure out what had actually happened.

Would this be the moment that we finally learned about Trump’s dealings with Russians, which might explain his solicitude to Vladimir Putin and Russian interests? Would we discover that, contrary to his claims, Trump has made very little in income or paid no income tax? After all, there must be some reason he refused to release his returns. Here, it was tempting to hope, was the moment it might all become clear.

Sadly, what Johnston received was not actually a complete copy of Trump’s tax returns, but rather his two-page Form 1040 from 2005. This is still big news in that we now know more than we did—assuming it is authentic, which the White House seemed to confirm in a statement Tuesday night—but it answers precious few of the questions many people have.

So, what did we learn? For one thing, we learned that Trump actually has earned substantial amounts over the years. Only about $100 million of the nearly $1 billion in losses from the early 1990s was still available in 2005, meaning Trump must have earned about $900 million (about $81 million per year) in the intervening years, assuming no additional losses. Based on this slice of the return, we can rule out the theory that, at least up until 2005, Trump wanted to obscure his income because it was far less than he would otherwise have us believe. Of course, he likely paid precious little in taxes on that income because of the aforementioned losses.

We also now know that he has actually paid some taxes, contrary to some speculation (speculation he has only fueled by refusing to release his returns). We learned he would have owed only about $5 million in taxes on about $150 million in income (about 3 percent) but for the alternative minimum tax (or AMT). As it was, he paid about $36 million in income taxes, representing a rate of about 25 percent, far lower than the regular statutory rate. This might help explain his proposal to eliminate the AMT.

And we know most of his income was business-related, as opposed to salary, but most people assumed that to be the case, anyway.

Oddly, the fact that he made a lot of money and actually did pay taxes helps him, making one wonder why he didn’t just release this on his own, assuming it’s real. Johnston actually raised the possibility that Trump may have leaked this himself, noting that he has been known to pull such stunts in the past.

What didn’t we learn? Without the schedules associated with this return and the returns of the various companies and partnerships whose income likely fed into this Form 1040, we can’t know who his business partners are, where he makes most of his money, or whom he pays and how much. In other words, this leak tells us very little about the core issues of Trump’s business entanglements that may—or may not—affect his policy decisions.

We also don’t know much about Trump’s itemized deductions, which came to about $17 million, according to the form. During the campaign, Trump claimed to be quite generous when it came to charity. Thanks to the dogged reporting of the Washington Post’s David Farenthold, we know a lot about his foundation and how he talked others into donating to it so that he could distribute those funds and take credit. Without a Schedule A form, we don’t know how much of his own money Trump actually gave in 2005.

Much has been made of the Emoluments Clause and the question of what Trump receives from foreign governments, whether it is through stays at Trump properties or trademarks for his various business interests in China. One great hope for the release of the tax returns has been that we would be able to see what favors Trump might be doing for others as he formulates U.S. policy and how he himself might benefit from his own decisions. Understanding the sources of Trump’s income, including the countries in which he makes most of his money and the people with whom he does business, might help explain why he threatens some countries with tariffs and not others. Or it could reveal that his foreign policy is completely disconnected from his financial interests. Trump’s behavior to date certainly suggests that he is self-regarding. He could go a long way toward addressing that reputation by revealing what his interests actually are.

Tuesday’s leak is certainly a step in the right direction for those interested in transparency and the important norm that presidents should make clear to the American people where their interests lie so that we can evaluate their motives. Nonetheless, it falls far short of what one might hope for. The leak simply reinforces Trump’s claim that he has made a lot of money without answering any of the questions about his financial dealings and potential conflicts of interest.

Tax Day is fast upon us. In a normal world, our president would release his tax returns for all to see. This ritual both reinforces the idea that we are all subject to the law and allows the American people to know that their president is not a crook. It also lets us know where the president’s financial interests lie so that we can be sure he has our interests at heart when he sets policy.

Perhaps Trump will surprise us all by releasing his taxes in the next few weeks. I’m not counting on it. While we cannot force him to behave as his predecessors have, we can at the very least refuse to let his nondisclosure pass unremarked upon. This still isn’t normal. And no one, whether Democrat or Republican, should let it become so.