President Donald Trump earned USD153 million and paid $36.5 million in income taxes in 2005, paying a roughly 25 percent effective tax rate thanks to a tax he has since sought to eliminate, according to highly sought-after newly-disclosed tax documents.
The pages from Trump’s federal tax return show the then-real estate mogul also reported a business loss of $103 million that year, although the documents don’t provide detail. The forms show that Trump paid an effective tax rate of 24.5 percent, a figure well above the roughly 10 percent the average American taxpayer forks over each year, but below the 27.4 percent that taxpayers earning 1 million dollars a year average were paying at the time, according to data from the Congressional Joint Committee on Taxation.
The tax forms were obtained by journalist David Cay Johnston, who runs a website called DCReport.org, and reported on MSNBC’s “The Rachel Maddow Show.” Johnston, who has long reported on tax issues, said he received the documents in the mail, unsolicited.
Trump’s hefty business loss appears to be a continued benefit from his use of a tax loophole in the 1990s, which allowed him to deduct previous losses in future years. In 1995, Trump reported a loss of more than $900 million, largely as a result of financial turmoil at his casinos.
Tax records obtained by The New York Times last year showed the losses were so large they could have allowed Trump to avoid paying taxes for up to 18 years. But Trump’s 2005 filing shows that another tax prevented him from realizing the full benefit of those deductions.
The bulk of Trump’s tax bill that year was due to the Alternative Minimum Tax, a tax aimed at preventing high-
income earners from paying minimal taxes.
The AMT requires many taxpayers to calculate their taxes twice — once under the rules for regular income tax and then again under AMT — and then pay the higher amount. Critics say the tax has ensnared more middle-class people than intended, raising what they owe the federal government each year.
Were it not for the AMT, Trump would have avoided all but a few million dollars of his 2005 tax bill.
Trump’s campaign website called for the end of the AMT, which is expected to bring in more than $350 billion in revenues from 2016 to 2025.
As a candidate and as president, Trump has refused to release his tax returns, breaking a decades-long tradition. AP
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