Poor Stallman

>>390 part 3 https://www.stallman.org/archives/2020-jul-oct.html#4_October_2020_(What_we_have_learned_from_the_conman's_tax_returns) -- A thorough report on what we have learned from the conman's tax returns. -- https://www.deccanherald.com/international/world-news-politics/donald-trump-did-not-pay-income-tax-in-10-of-last-15-years-894048.html -- Donald Trump did not pay income tax in 10 of last 15 years -- Sep 28 2020

For Trump, that bottom line must have looked familiar. It was the fourth year in a row that he had not paid a penny of federal income taxes. Trump’s avoidance of income taxes is one of the most striking discoveries in his tax returns, especially given the vast wash of income itemized elsewhere in those filings. Trump’s net income from his fame — his 50 per cent share of “The Apprentice,” together with the riches showered upon him by the scores of suitors paying to use his name — totalled $427.4 million through 2018. A further $176.5 million in profit came to him through his investment in two highly successful office buildings.

So how did he escape nearly all taxes on that fortune? Even the effective tax rate paid by the wealthiest 1 per cent of Americans could have caused him to pay more than $100 million. The answer rests in a third category of Trump’s endeavours: businesses that he owns and runs himself. The collective and persistent losses he reported from them largely absolved him from paying federal income taxes on the $600 million from “The Apprentice,” branding deals and investments. That equation is a key element of the alchemy of Trump’s finances: using the proceeds of his celebrity to purchase and prop up risky businesses, then wielding their losses to avoid taxes. Throughout his career, Trump’s business losses have often accumulated in sums larger than could be used to reduce taxes on other income in a single year. But the tax code offers a workaround: With some restrictions, business owners can carry forward leftover losses to reduce taxes in future years.

That provision has been the background music to Trump’s life. As The Times’ previous reporting on his 1995 return showed, the nearly $1 billion in losses from his early-1990s collapse generated a tax deduction that he could use for up to 18 years going forward. The newer tax returns show that Trump burned through the last of the tax-reducing power of that $1 billion in 2005, just as a torrent of entertainment riches began coming his way following the debut of “The Apprentice” the year before. For 2005 through 2007, cash from licensing deals and endorsements filled Trump’s bank accounts with $120 million in pure profit. With no prior-year losses left to reduce his taxable income, he paid substantial federal income taxes for the first time in his life: a total of $70.1 million. As his celebrity income swelled, Trump went on a buying spree unlike any he had had since the 1980s, when eager banks and his father’s wealth allowed him to buy or build the casinos, airplanes, yacht and old hotel that would soon lay him low.

When “The Apprentice” premiered, Trump had opened only two golf courses and was renovating two more. By the end of 2015, he had 15 courses and was transforming the Old Post Office building in Washington into a Trump International Hotel. But rather than making him wealthier, the tax records reveal as never before, each new acquisition only fed the downward draft on his bottom line. Consider the results at his largest golf resort, Trump National Doral, near Miami. Trump bought the resort for $150 million in 2012; through 2018, his losses have totaled $162.3 million. He has pumped $213 million of fresh cash into Doral, tax records show, and has a $125 million mortgage balance coming due in three years. His three courses in Europe — two in Scotland and one in Ireland — have reported a combined $63.6 million in losses. Overall, since 2000, Trump has reported losses of $315.6 million at the golf courses that are his prized possessions.

For all of its Trumpworld allure, his Washington hotel, opened in 2016, has not fared much better. Its tax records show losses through 2018 of $55.5 million. And Trump Corp., a real estate services company, has reported losing $134 million since 2000. Trump personally bankrolled the losses year after year, marking his cash infusions as a loan with an ever-increasing balance, his tax records show. In 2016, he gave up on getting paid back and turned the loan into a cash contribution. Trump has often posited that his losses are more accounting magic than actual money out the door. Last year, after The Times published details of his tax returns from the 1980s and 1990s, he attributed the red ink to depreciation, which he said in a tweet would show “losses in almost all cases” and that “much was non monetary.”

“I love depreciation,” Trump said during a presidential debate in 2016. Depreciation, though, is not a magic wand — it involves real money spent or borrowed to buy buildings or other assets that are expected to last years. Those costs must be spread out as expenses and deducted over the useful life of the asset. Even so, the rules do hold particular advantages for real estate developers like Trump, who are allowed to use their real estate losses to reduce their taxable income from other activities. What the tax records for Trump’s businesses show, however, is that he has lost chunks of his fortune even before depreciation is figured in. The three European golf courses, the Washington hotel, Doral and Trump Corp. reported losing a total of $150.3 million from 2010 through 2018, without including depreciation as an expense. To see what a successful business looks like, depreciation or not, look no further than one in Trump’s portfolio that he does not manage.