Monday, October 3, 2016

Here's the Problem with Donald Trump Releasing His Tax Returns

The New York Times has published certain documents from Donald Trump's 1995 tax returns which show he declared a $916 million loss that year. Got that 1995? That according to my calculations is more than 20 years ago.

I would venture to guess that  a $916 million loss is not the type of loss the IRS sees on a regular basis. They would have paid attention. Trump has stated that he is regularly audited. Got that? They probably haven't forgotten about that $916 million loss.

It is unlikely that he was trying to pull some tax scam around this deduction, given the way he is monitored by the IRS.

But with this extremely limited tax return leak, speculation started immediately on what Trump's real tax move was.

John Hempton, at Bronte Capital, for example, going on nothing but the limited leaked 1995 Trump tax documents is speculating that Trump may have created an illegal debt parking scheme.

Bill Kristol is already promoting Hempton's speculation:

I guess that it is possible Trump parked the debt, though it would be difficult to think he would take such a criminal risk. There is also the very real possibility that in following years Trump recognized income after settling with debtors--which would rule out debt parking. The general  public has no idea, neither does Hempton.

Trump's taxes are very complex, If he released all his taxes, there would be Hempton-type charges surrounding many individual items across  his thousands of pages of filings. The charges would be pure speculation that could cast all kinds of untrue aspersions about Trump tax maneuvers.

Trump is running a pretty insane campaign but he is absolutely wise in not releasing his complex taxes.


1 comment:

  1. Since it is likely that none at the NYT has any clue how business works, it must seem like a tremendous scandal to them.