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Tax Returns Investigation: $1 Billion in Losses, Tax Avoidance Schemes Documented

The 2019 NYT investigation used IRS data from 1985-1994, finding Trump declared $1.17 billion in losses — an average of $117 million per year — largely from casino and real estate failures. The losses were so large that Trump paid no income tax in eight of the ten years. The 2020 investigation of complete tax returns found Trump paid $750 in federal income taxes in 2016 and $750 in 2017 through aggressive deductions, carried-forward losses, and tax credits. Trump had for decades refused to release his tax returns, claiming he was under IRS audit. He remained the only presidential candidate in modern history to refuse release until his returns were eventually obtained by courts after litigation.

Record summary

Grade

Grade 2 of 5: Major Abuse of Power

Executive actions that exceed constitutional authority, circumvent statutory constraints, or weaponize government institutions for political ends. Scale and definitions

Status
Concluded
Incident date
Record updated
Location
New York, NY
Legal posture
Judicial finding
War-crime classification
Enabling conduct
Verification
Independently verified
ICC relevance
No
Sources
4 cited
Stable ID
trump-pre-presidency-tax-returns-nyt-losses
Victims
American taxpayers whose tax burden was increased by aggressive corporate loss exploitation; voters denied transparency about a presidential candidate's financial interests and potential foreign debt obligations; democratic accountability undermined by unprecedented refusal to disclose financial records
Alleged responsible parties
  • Donald Trump, Taxpayer; used aggressive loss-carry-forward strategies, self-dealing deductions, and expense claims to minimize federal income tax liability while claiming to be a wealthy and successful businessman; refused to disclose tax returns to voters for years— Trump Organization

Key points

  • IRS records reviewed by the New York Times showed Trump declared $1.17 billion in losses from 1985 to 1994 — the largest individual losses in IRS data for that period; the losses were primarily from his Atlantic City casinos and real estate operations; they allowed Trump to avoid paying federal income taxes in 8 of the 10 years and to carry losses forward to offset future income
  • Trump paid $750 in federal income taxes in 2016 — the year he won the presidency — and $750 in 2017, his first year in office; in 10 of 15 years between 2000 and 2015, he paid no income tax at all; the minimal payments resulted from a combination of depreciation deductions, carried-forward losses, consulting fee deductions, and other strategies
  • The 2020 investigation documented significant self-dealing deductions: Trump claimed approximately $26 million in unexplained consulting fees as business expenses, including $747,622 in payments to a consulting company that turned out to be owned by his daughter Ivanka Trump — meaning he deducted payments to his own child as business expenses while she was also a senior employee of the Trump Organization
  • Trump's tax returns showed he had hundreds of millions in personal debt coming due during his presidency — at least $421 million in loans personally guaranteed, with the largest portion owed to Deutsche Bank; the scale of personal debt raised concerns among ethics officials and financial analysts about potential conflicts of interest and foreign leverage
  • Trump broke with 40+ years of presidential candidate precedent by refusing to release his tax returns during the 2016 and 2020 campaigns, claiming he was under IRS audit; the IRS audit claim, while possibly true, was not a legal bar to release; his returns were eventually obtained by the House Ways and Means Committee after years of litigation and released in December 2022
  • The $70,000 claimed for hairstyling as a business deduction during the years Trump hosted 'The Apprentice' on NBC — for what appeared to be Trump's signature styled hair — became a focus of public attention after the 2020 investigation; tax experts noted that personal grooming expenses are generally not deductible as business expenses

Overview

Trump claimed to be worth billions and said he was a successful businessman. His tax returns documented that he had declared $1.17 billion in losses over ten years — more than any other individual American in IRS records for that period.

He paid $750 in federal income taxes in the year he won the presidency. He paid $750 the year he served as president. In 10 of 15 years between 2000 and 2015, he paid nothing.

The Losses

The billion dollars in declared losses came primarily from the Atlantic City casinos that were failing and from real estate operations that were underperforming. The losses were real in the sense that the businesses were genuinely bleeding money — but they were also strategically useful, because they could be carried forward to offset future income and eliminate tax liability.

Trump's public presentation throughout this period was of a brilliant, successful businessman whose deal-making skills made him money. His tax returns told a different story: decade after decade of declared losses that resulted in zero federal income tax while he was building the brand of success that eventually carried him to the presidency.

The $750 Years

In 2016 and 2017, Trump paid $750 in federal income taxes. This was not zero — the $750 appears to have reflected a minimum alternative minimum tax payment. But it was the tax contribution of a president whose administration was simultaneously enacting a tax bill that would predominantly benefit the wealthy.

The deductions that produced this outcome included $26 million in unexplained consulting fees, $747,622 in payments to a consulting company that turned out to be owned by Ivanka Trump, and $70,000 for what appeared to be personal hairstyling costs claimed as business deductions.

The Debt

The 2020 investigation documented something beyond the tax avoidance: hundreds of millions in personal debt coming due during Trump's presidency. At least $421 million in personally guaranteed loans, with the largest amounts owed to Deutsche Bank.

A president with hundreds of millions in personal debt, negotiating international agreements and financial policy, was a financial conflict of interest that had no precedent in modern American history. The public would not have known about it if the returns had not been leaked.

The Precedent

Trump was the first presidential candidate in more than four decades to refuse to release his tax returns. Every major-party candidate since 1976 had done so. Trump's refusal, sustained by litigation through two campaigns and his presidency, was itself a democratic accountability failure — voters were asked to judge a man whose financial interests and obligations were systematically hidden from them.

The returns were eventually obtained by the House after years in court. They confirmed what the investigations had found.

Update log

  1. Updated with 2020 NYT investigation findings.

Sequence of events

  1. Decade of losses begins — casino and real estate operations

    Trump begins a decade (1985-1994) in which he declares $1.17 billion in business losses, primarily from Atlantic City casino operations and real estate. The losses allow him to pay no federal income tax in 8 of 10 years.

  2. Trump pays $750 in federal income taxes — year he runs for and wins presidency

    In 2016, as Trump campaigns for and wins the presidency, he pays $750 in federal income taxes. The minimal payment results from accumulated loss carry-forwards, deductions, and other strategies.

  3. NYT publishes 1985-1994 IRS data — $1.17 billion in losses

    The New York Times publishes an investigation using IRS data showing Trump declared $1.17 billion in losses from 1985 to 1994 — more than any other individual American taxpayer in that period. Trump calls it fake news.

  4. NYT publishes 20 years of tax returns — $750 payments, hundreds of millions in debt

    The New York Times publishes a comprehensive investigation of Trump's tax returns showing $750 payments in 2016 and 2017, $421 million in personally guaranteed debt, $26 million in unexplained consulting fees including Ivanka deductions, and $70,000 in hairstyling deductions.

  5. House Ways and Means releases Trump tax returns

    After years of litigation, the House Ways and Means Committee releases Trump's actual tax returns. The documents confirm the NYT investigation's findings and reveal additional details about his tax strategy and financial obligations.

Sources

  1. Decade in the Red: Trump Tax Figures Show Over $1 Billion in Business Losses — The New York Times
  2. Long-Concealed Records Show Trump's Chronic Losses and Years of Tax Avoidance — The New York Times archived ✓
  3. NYT investigation: Trump paid $750 in federal income taxes in 2016 — The Associated Press
  4. Trump paid just $750 in federal income taxes in 2016 and 2017 — The Washington Post

How this record was published

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