Was Donald Trump able to avoid paying federal income tax for nearly two decades? The New York Times obtained the first pages of Trump’s 1995 state income tax returns and found that he declared a $916 million net operating loss that year. Carrying forward those losses “could have allowed him to legally avoid paying any federal income taxes for up to 18 years,” The Times said. The Trump campaign did not dispute the report but surrogate Rudy Giuliani insisted, "This is a perfectly legal application of the tax code and he would've been fool not to take advantage of it.”
Is the Donald J. Trump Foundation operating legally? The New York state attorney general’s office says Trump’s tax-exempt foundation lacks the necessary certification to solicit money from the public, reports The Washington Post. Should state Attorney General Eric Schneiderman find that the foundation raised money illegally, he could bar additional fundraising. And a court could allow Schneiderman to force Trump to return past gifts.
Immigration is good for our economic and fiscal future. TPC’s Kim Rueben shares the conclusion of the National Academies of Sciences, Engineering, and Medicine panel and its report. Immigrants are arriving in their prime working years and help counterbalance a native population that is aging out of the workforce. They also help support federal programs through the taxes they pay. “Their net contribution to society and the economy will have less to do with where they come from and more to do with their individual characteristics,” notes Rueben. “And that’s how it’s been in the United States for the past 240 years.”
As for the House GOP’s fiscal plans… The Center on Budget and Policy Priorities finds that the House GOP budget proposed in March and its “Better Way” tax plan “would significantly raise the incomes of millionaires while sharply cutting programs for low-, moderate-, and middle-income families and individuals.”
More corporate profits sitting overseas? Last week, the Joint Committee on Taxation upped its estimate of the amount of untaxed corporate profits from $2.3 trillion to $2.6 trillion. A tax on the larger amount, as many lawmakers have proposed, could produce some additional revenue to fund a corporate tax reform. JCT said its higher estimate was due to world economic growth and increases in corporate profits. The JCT estimate is still only half of what Donald Trump claims US firms have in un-repatriated profits.
New Jersey will raise its gasoline tax after all. GOP Governor Chris Christie agreed Friday to raise the state’s gasoline tax by 23 cents a gallon: “I’m authorizing this one because of the importance of the Transportation Trust Fund, the tax fairness that we’ve accomplished together and the compromise we’ve reached, and because we need to responsibly finance this type of activity.”
India’s tax amnesty program seems to have worked. A four-month tax amnesty window closed on Friday, and 64,275 people declared more than $9.5 billion in undeclared income and assets. India’s government offered immunity from prosecution in return for paying tax, a surcharge and a penalty. The government could raise an estimated $4.5 billion in tax revenue.
Call for tax administration papers! The IRS and TPC will co-sponsor their seventh annual tax administration research conference on June 21, 2017, at the Urban Institute. General areas of interest include measuring and influencing taxpayer compliance, estimating taxpayer compliance costs, tax complexity, improving tax administration, and understanding the nature and behavior of the taxpayer population. Proposals are welcome from government and non-government researchers and are due by Thursday, December 1, 2016.
Congress is in recess. The Daily Deduction will post Mondays in the interim.
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