When it comes to Trump, the truth doesn’t matter.
The big story today is a report that shows that in the 90’s Donald Trump lost more than a billion dollars. While the report simply points out that Trump may have been able to shield a billion dollars in gains as a result — the media is twisting this possibility to suggest Trump hasn’t paid taxes in 18 years. The truth is that Trump paid more than $300M in taxes on that billion dollars in the first place. This is yet another example of how the truth doesn’t matter when it comes to reporting on Donald Trump.
The IRS allows businesses and certain individuals to carry their NOL (net operating losses) forward for a certain number of years. This isn’t a special provision for Donald Trump — the Congress created the provision to encourage businesses and business people to take risks. In Donald Trump’s case he bet billions on Atlantic City and he lost — the money was spent. Spent on the salaries of New Jersey employees, spent on local sales and property taxes, spent on painters, carpet layers, electricians, and plumbers — billions spent in the local community. The key fact is that you must lose MONEY to be able to deduct those losses in the future. In Trump’s case he paid $300M in taxes on the billion dollars he lost so the government allows him to NOT pay taxes on the next billion dollars he makes.
When the media says Trump hasn’t paid taxes in 18 years they are assuming that he has made less than a billion dollars since he lost a billion dollars. This might be the case, but some back of the envelope math on his income basically blows this theory away. Additionally, the tax law in this area is complex for individuals versus business entities — there are options for carrying the loss backward and forward — the chances that Trump has been able to use his NOL for 20+ years is very unlikely.
Finally, the left gets very angry when conservatives point out that half of Americans pay no taxes. They point out that while only half of Americans pay no federal income taxes they do pay taxes — sales tax, property tax, payroll taxes, and so on. Even if Trump was able to use his NOL for 20+ years he’s paid hundreds of millions in property taxes, sales and excise taxes, real estate taxes, city taxes, state taxes, employee taxes and federal taxes.
