Trump and taxes

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Trump: IRS Audit May Not be
Complete by November

| published May 11, 2016 |

By R. Alan Clanton, Thursday Review editor

Donald Trump says he cannot release his tax records until the Feds complete an audit, apparently ongoing for several years. Trump has told reporters numerous times that there is nothing to hide, and that because he is a billionaire and a mover in major real estate deals, he is more-or-less in a constant state of audit, and always under scrutiny by the IRS.

But former Republican Presidential candidate Mitt Romney—along with a lot of Republicans in the House and Senate—worries aloud that Trump’s taxes may contain something explosive, perhaps even something catastrophic for the GOP. And Romney suggests that Trump must necessarily have something to hide.

“It is disqualifying for a modern day Presidential nominee to refuse to release their tax returns to the voters,” Romney said this week.

In fact, in contemporary U.S. politics, it has been nearly 50 years since a major Presidential candidate demurred on their tax information. For that reason, though it is not required by either party nor is it a mandatory process for candidates, the release of financial records—notably tax returns—have become something of a hallowed tradition.

Trump says that the current audit precludes him from releasing tax returns, and today added the caveat that the audit almost certainly will not be completed by November. That means that Trump will be the first major Presidential candidate since the 1960s to refuse to release tax information to the press and to the public.

In debates and in interviews dating back more than one year, Trump has said that he cannot release any tax records while the Feds are checking the math and eyeballing the data. But the IRS, according to the Associated Press and other media outlets, has said that as far as they are concerned Trump can release his tax returns at any time. The IRS cites plenty of examples of political figures who have made public their tax information even during an ongoing investigation, and even while an audit was being conducted.

The unbroken tradition of Presidential candidates releasing their tax returns dates back to Gerald Ford and Jimmy Carter in 1976. Prior to that, many candidates—but not all—did release their tax information, including Richard Nixon in 1952 and again in 1960, both times while being audited by the IRS. When the IRS found nothing untoward or amiss in Nixon’s financial records, Nixon turned those potential landmines into valuable political ordnance.

Mitt Romney was reluctant to release his tax information in 2011 and 2012, but was eventually convinced to do so by his friends and advisors who stressed that the Democrats would savage him—especially for his wealth—as being a creature of hidden sources of money and shady financial dealings. Romney’s tax returns provided no surprises, and, in fact, showed him to be a more generous and charitable giver than previously thought. Among those who prodded Romney toward full disclosure that election cycle was none other than Donald Trump, an early Romney supporter.

This week Romney said that his 2012 decision to release those tax returns was both liberating and politically valuable, for it clears the board of many questions voters might have about a candidate. Romney also cited the contradiction between Trump’s claims and those of the IRS, and the former Massachusetts’ Governor says that Trump must necessarily have something serious to hide from the voting public.

“There is only one logical explanation for Mr. Trump’s refusal to release his [tax] returns,” Romney said on Wednesday. “There is a bombshell in them!”

Romney cited the varying reasons why the public would want to know tax information: the returns illuminate the veracity of a candidate’s claims about income, sources of wealth, charitable contributions, spending priorities, tax conformance, dividends and interest, conflicts of interest.

Democratic front-runner Hillary Clinton wasted little time this week attacking Trump directly on the billionaire’s refusal to release tax data. In blistering and contemptuous tones, Clinton suggested that Trump has plenty to hide.

Clinton said that when someone is running for President, the release of tax information is “kind of expected.”

“So you’ve got to ask yourself,” Clinton said at a speech in New Jersey, “why doesn’t he want to release them?” Then, implying that eventually during the campaign the truth would come out anyway, she added, “Yeah, well, we’re going to find out.”

Sources close to the Clinton campaign say that her strategists see the tax issue as a large target, now painted much larger by Trump himself with his recent assertion that his returns will likely not be available before November. Clinton’s team has been fine-tuning counter-attacks to Trump’s new line of assault: that Hillary Clinton was a delusional enabler of husband Bill Clinton’s sexual misconduct as Governor of Arkansas and as President of the United States.

Clinton’s top people also think that the tax issue might easily neutralize the marital misconduct issue, and may also be a strong enough retort to the ongoing imbroglio over Clinton’s emails and unsecured computer server used during her tenure as Secretary of State.

But Republican leaders are more worried about the long-term damage to the GOP if Trump’s taxes do, in fact, contain something explosive or shocking.

On the eve of a key meeting between Trump, House Speaker Paul Ryan, and other top Republican leaders—a meeting in which the idea of party unity will be front-and-center—many GOP members of Congress are worried that Trump’s stonewalling on the tax issue will eventually backfire, with disastrous results for the Republican brand.

Trump says it is all nonsense—hyperbole by nervous Republicans and desperation by a deeply worried Clinton. Trump says there are no bombshells in the tax returns.

“There’s nothing to learn from them,” Trump told reporters for the Associated Press by phone on Wednesday, adding that the IRS audit was “very unfair.”

The tax issue may be merely a taste of what we can expect from a campaign which could get a lot nastier before it is over. Trump has said that he is only now getting started on his plan to hammer Clinton on every negative issue—from Benghazi to her private emails, from her failed healthcare initiative during the early Clinton years to the sexual misconduct of Bill Clinton. But Clinton clearly believes that she has found the chink in Trump’s armor—taxes.

Trump became the presumed nominee nine days ago after candidates Ted Cruz and John Kasich each ended their campaigns for President after Trump won the Indiana primary by a wide margin.

Related Thursday Review articles:

In Pivotal States, Clinton and Trump Are Tied; Keith H. Roberts; Thursday Review; May 10, 2016.

Ryan: Will Step Down as Convention Chair if Trump Insists; R. Alan Clanton; Thursday Review; May 9, 2016.