Donald Trump dismissed the revelations about his tax returns as ‘fake news’ © Ken Cedano/Reuters

Donald Trump paid just $750 a year in federal income taxes in 2016 and 2017, the New York Times reported on Sunday, after obtaining tax-return data the US president has refused to release in defiance of decades of presidential tradition.

In 11 of the 18 years of taxes examined by the New York Times, Mr Trump paid no federal income taxes at all, the newspaper reported.

The revelations came just days before Mr Trump’s first debate with Joe Biden, his Democratic rival for president, on Tuesday, and portrayed a real estate tycoon who paid less in federal income taxes than millions of ordinary Americans.

The paper reported that Mr Trump's largely lossmaking business empire had long been propped up by his earnings from his reality TV show The Apprentice.

With that income, and other income from licensing deals, dwindling and loans coming due, Mr Trump was “in a tightening financial vice”, the New York Times said.

Mr Trump at a press conference on Sunday afternoon dismissed the report as “made up” and “totally fake news”. The president claimed he had “paid a lot” in taxes, but declined to give a figure.

“It’ll all be revealed, it’s going to come out. But after the audit,” he said.

Mr Trump is the first US president since the 1970s who has not released his tax returns.

Since before his 2016 election, Mr Trump has claimed that he cannot reveal his taxes because they are under audit by the Internal Revenue Service.

In 2019, Mr Trump’s IRS commissioner, Charles Rettig, said there was no rule preventing individuals releasing their taxes if they were under audit.

Beyond not disclosing his taxes, Mr Trump has also fought to keep them secret from prosecutors and investigators in Congress, all the way to the Supreme Court, which ruled against him in part this summer.

The New York Times report is the most detailed examination of Mr Trump’s tax affairs published to date. Dean Baquet, the newspaper’s editor, said in a note it was not publishing the tax documents it obtained to protect its sources. 

“We are publishing this report because we believe citizens should understand as much as possible about their leaders and representatives — their priorities, their experiences and also their finances,” he wrote.

Among the revelations was the disclosure that Mr Trump is on the hook for more than $300m in loans that would come due in his second term in office if he were re-elected. His total personal liability was $421m, the newspaper said.

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The paper also reported that Mr Trump’s golf courses and resorts were heavily lossmaking, with those losses offsetting any income taxes he owed.

It said that from 2016 to 2017, “general and administrative expenses” at Mr Trump’s Bedminster golf club had increased five times.

The New York Times said that among the business expenses that Mr Trump had offset against his taxes was $70,000 to style his hair during The Apprentice, the TV show that made him a star.

The paper additionally revealed that Mr Trump has been locked in a dispute with the IRS since 2010 over a $72.9m tax refund he received for taxes paid between 2005 and 2008.

The refund arose from a tax policy implemented by the Obama administration during the depths of the economic downturn following the financial crisis in order to quickly inject money into the economy.

Mr Trump had received the refund after declaring hundreds of millions of dollars in business losses from his failed Atlantic City casino empire, but the New York Times said he may not have been eligible for the rebate because he retained a small stake when the casino emerged from bankruptcy. He could owe $100m if required to pay back the refund.

Although his tax affairs have not been revealed in such detail previously, glimpses of his finances have emerged from a mixture of official disclosures, newspaper reporting, legal settlements and testimony from former confidants.

As president, Mr Trump files an annual statement of his finances, though it only records revenue, not profits. Last year, Mr Trump admitted misusing funds from his former charitable foundation in a $2m settlement with the New York attorney-general, Letitia James.

Michael Cohen, the president's former personal lawyer who was convicted of tax and campaign finance crimes and lying to Congress, testified before the House oversight committee in 2019 that Mr Trump had inflated or deflated the stated value of his assets to obtain bank loans or reduce his tax bills.

The New York Times reported in 2018 that much of Mr Trump's original wealth was handed down from his father using a variety of “tax dodges” to avoid inheritance taxes. This year, Mary Trump, the president's niece who is now a vocal critic, revealed that she had been an important source for the New York Times’ 2018 report.

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