Six years ago, when asked if he would release his tax returns if he ran for president, Donald Trump said, “I would love to do that.” 

Two years later, during his presidential campaign, Trump employed an elaborate scheme involving private lawyers and the power of his Justice Department to avoid the subpoenas issued by prosecutors and congressional investigators. 

Finally, just months before Trump’s first presidential term comes to an end, The New York Times has obtained his tax information and released an exposé detailing decades of tax avoidance and immense losses. 

As Trump once said, “Part of the beauty of me is that I’m very rich,” so how is it possible that he could be the successful businessman he claims himself to be and yet pay so little in taxes? 

Essentially, Trump has been able to avoid paying income taxes with a very unique business model: he begins by launching numerous businesses, most of which lose millions of dollars each year, before taking advantage of his celebrity standing and making money off of personal branding. For example, he made $15,286,244 from a licensing deal with a mattress company, and $15 million more from Trump shirts, underwear, and neckties. While it may seem like a roundabout and defective way of making money, it is not illegal. 

Furthermore, The New York Times made the claim that Trump has been able to maintain an extravagant lifestyle by taking tax deductions on expenses like residences and aircraft that should have been considered personal expenses. The article also claimed that he has written off millions of dollars worth of “mysterious” and unspecified consulting fees. Some of these unspecified fees appear to have been paid to his daughter, Ivanka Trump. An I.R.S. audit is underway to determine the exact extent of these dealings, which would be considered illegal. 

The revealing of Trump’s tax avoidance and convoluted business dealings could not have come at a worse time. With just over a month left before the election, this new information could contribute to bringing Trump even further down in a race that the polls show he is already losing. 

Although the number of undecided voters in the U.S. is surprisingly low, the fact that Trump paid no income taxes for 11 out of the past 18 years and that he only paid $750 in income taxes for 2016 and 2017 could affect his appeal among blue-collar voters, who were necessary in winning him the presidency in 2016. 

According to the IRS report cited in an Associated Press article, the average income tax paid in 2017 was just over $12,000. This emphasizes the glaring disparity between what Trump has paid over the last few decades and what the average American has paid, which could generate resentment. 

Despite these blows to Trump’s reputation as a savvy businessman, his campaigns have survived similar events. Only time will tell what the results of this information will be.

Photo courtesy of CNN.COM