Tag Archives: income tax

Records show Trump released tax returns when he stood to gain

Donald Trump won’t publicly release his income tax returns but records reveal the New York businessman turned them over when it suited his needs.

The Associated Press is reporting that Trump provided his returns when he stood to make a profit, needed a loan or when dealing with legal matters.

The news service reports that Pennsylvania gaming regulators were given at least five years’ worth and eight boxes full of Trump’s tax documents.

Also, Nevada, Michigan, Missouri, Indiana and other state gaming officials had access to multiple years of Trump’s returns.

And large banks that lent Trump money over the years have obtained Trump’s returns.

In all cases reviewed by The Associated Press, each person, organization, company or government office that has seen Trump’s tax returns is barred from discussing their full contents by professional or legal restrictions.

So the public still knows little about Trump’s more recent finances.

At a press event today in Waukesha, Wisconsin Democrats plan to call on Trump to release his tax returns.

An announcement from Hillary Clinton’s campaign said the event at noon at the Waukesha DNC headquarters would involve Democratic supporters, including state Rep. Mandela Barnes.

In the debate earlier this week, Clinton questioned whether Trump’s tax returns might reveal that he has paid little or no taxes. Trump said he was “smart” for not paying federal income taxes in some years.

Documents first reported on by Politico show Trump didn’t pay any federal income tax during at least two years in the early 1990s because he lost more money than he earned.

Other documents show he didn’t pay any federal income taxes in 1978, 1979 and 1984.

Trump has repeatedly refused to release his tax returns citing an IRS audit, but the IRS and tax experts have said an audit doesn’t bar Trump from making the documents public.

Since 1976, every major party nominee has released the returns and Clinton has publicly released nearly 40 years’ worth.

Trump’s tax returns would reveal his charitable contributions. The AP has reported that there is little record of substantial personal philanthropy from Trump.

The returns would also reveal how much Trump earned from his assets, helping someone work back to an approximation of his net worth to compare to his own estimation.

Wisconsin’s richest woman: 3 years with no state income tax

The richest woman in Wisconsin paid no state income taxes from 2012 through 2014.

Billionaire Diane Hendricks paid no taxes because of the way her corporation, Beloit-based ABC Supply Co., is organized, the company’s tax director Scott Bianchini told The Associated Press. He said she did pay $7.6 million in state income taxes for 2015.

“Diane Hendricks and ABC Supply have paid hundreds of millions of dollars of federal and state income taxes over the years in question,” Bianchini said.

The figures were first reported Thursday by the Milwaukee Journal Sentinel.

Hendricks is a longtime backer of Republican Gov. Scott Walker and vice chairwoman of a fundraising committee for Donald Trump.

Bianchini said Hendricks didn’t pay taxes over the years in question because ABC was organized as a C corporation, but she did last year when it was organized as an S corporation.

“It’s that simple,” he said.

Hendricks, 69, was named “America’s Richest Self-Made Woman” by Forbes Magazine this month, which estimated her net worth to be nearly $5 billion. She and her husband co-founded the roofing supply company, which has since grown into the nation’s largest, in 1982.

In May, Hendricks was named to the Trump Victory leadership team, which is raising money for his presidential run. She was named to the team by Wisconsin native Reince Priebus, chairman of the Republican National Committee.

Hendricks has given $5 million to a super PAC that supported Walker’s run for president and $500,000 to his 2012 recall campaign. It was Hendricks whom Walker was talking with when he caught on tape saying he planned to use a “divide and conquer” strategy against unions, just before releasing his proposal in 2011 that effectively ended collective bargaining for most public employees.

Walker, when asked Thursday by the Journal Sentinel about Hendricks’ not paying taxes, said that’s an issue on the federal level because state income taxes are based on federal tax returns. Walker said his goal is to lower taxes for the middle class. When the Journal Sentinel asked what kind of a message it sends to the middle class when a billionaire like Hendricks pays no income taxes, he said, “It’s not because of things that we’ve done.”

Accountants Joel Joyce and Christa Baldridge told the newspaper that it isn’t unusual for a wealthy person to end the year with zero tax liability and then have a tax bill the following year. Among the reasons why could be investment losses, various deductions or credits, or tax losses from a previous year that are used against income earned in a later year.

Bianchini said Hendricks was on vacation and not available to comment.

Experts offer tax guidance to newlywed same-sex couples

Karie Washington and Anne Hurley promised to love, honor and cherish. And, having commingled their financial affairs long before they legally married, the Madison women also promised to file one tax return on Tax Day 2015.

“It’s kind of scary — who isn’t afraid of the IRS?” said Washington.

For newlywed same-sex couples with concerns and questions about filing their state or federal taxes, a number of organizations are offering guidance and assistance.

Lambda Legal, the legal defense and education group long at the forefront of the push for marriage equality, issued a guide, “Eight things same-sex couples need to know about taxes,” in advance of the filing deadline.

The Tax Foundation also released a guide, as did The National LGBT Bar Association, working in partnership with BNY Mellon and White and Case LLP.

“Tax season is always a trying time for many families, but for LGBT families especially,” said D’Arcy Kemnitz, The LGBT Bar’s executive director. “The quickly changing legal landscape makes things even more complicated.”

Kemnitz said the association and its partners produced “The Online LGBT Tax Resource” to provide taxpayers and tax preparers the best possible state-by-state information.

The bar’s online resource — lgbtbar.org/tax — reviews state rules concerning same-sex marriage, including the impact on state income tax; contains state guidance for married same-sex taxpayers; provides information on litigation and legislation that could impact LGBT families filing taxes; and reports notices from state revenue departments.

“Because laws vary from state to state, we marshaled the knowledge and skills of our pro bono teams to deliver an outstanding resource for the LGBT community,” said Arunas Gudaitis, managing director and senior managing counsel at BNY Mellon. “As a result, the online guide offers direction to same-sex couples and their tax advisers and prepares a comprehensive view of tax laws and regulations across the country.”

For Wisconsin, where same-sex couples began marrying last June, The LGBT Bar guidance cites the case law dealing with marriage equality and confirms that married same-sex couples “file their Wisconsin individual income tax returns as married filing jointly, married filing separately or, if qualified, as head of household.” Married same-sex couples do not require a Schedule S, as was required last year. 

For federal purposes, the IRS in 2013 said married same-sex couples, regardless of where they live, file as “married” and chose “married filing jointly” or “married filing separately,” according to Lambda Legal, which has a website at lambdalegal.org.

Walker says he’ll cut property taxes, but won’t say how he’ll plug budget hole

Gov. Scott Walker said in an interview Dec. 29 he remains committed to lowering property taxes next year as he promised in his re-election campaign, even though the state faces a projected $2.2 billion state budget shortfall that will likely result in spending cuts and other money-saving moves.

Walker spoke to The Associated Press from the governor’s mansion as he prepares to be sworn in for his second term on Jan. 5. Republicans return with even larger majorities in both the state Senate and Assembly, which should help Walker pursue his agenda while he also mulls a run for president in 2016.

Walker said many decisions have yet to be made about the budget, which he will submit to the Legislature likely in early February and that will be passed in late spring. He didn’t spell out how he would pay for a property tax cut, or how much it would be, or explain how he would plug the shortfall, saying those details would come when he puts his budget forward.

He also declined to say whether he would support the gas tax increase and new fee for owners of hybrid and electric cars that were included in a $750 million tax and fee hike proposal from his Department of Transportation.

“It’s a tight budget,” Walker said. “We have to find ways to balance it all throughout the state budget.”

The Democratic legislative leaders, Rep. Peter Barca and Sen. Jennifer Shilling, said Republicans should focus on helping the middle class.

“Rather than digging a deeper budget hole, we need to invest in education, worker training and economic infrastructure to create jobs and build toward a brighter future,” Shilling said in a statement.

Walker said he is looking at merging and consolidating duties of a number of state agencies, including work done at his chief jobs agency, the Wisconsin Economic Development Corp. He’s also looking at shuffling duties at the Wisconsin Housing and Economic Development Authority, the Department of Safety and Professional Services and the Department of Financial Institutions.

While that proposal remains a work in progress, Walker was similarly vague about his plans for balancing the budget and delivering a property tax cut. He also didn’t say whether public schools and the University of Wisconsin System would get the additional money they requested.

“That depends on where we’re at at the tail end of the budget process,” he said when asked if K-12 education would see an increase. And as for the UW System, Walker said he was looking at ways to give UW campuses more flexibility as a way to save money.

While Walker remains focused on cutting property taxes, it appears any income tax reduction will have to wait. He had promised during the campaign to cut both.

“We’ll make sure that property taxes continue to go down,” Walker said. “I don’t know that there will be a specific proposal for a tax cut, at least immediately, on income.”

Walker and the Republican-controlled Legislature cut taxes by about $2 billion during his first term, with a focus on both property and income taxes as well as manufacturing taxes. Because of those cuts, the typical homeowner will pay $141 less in property taxes this year than they did in 2010.

Reform tax code

This issue of Wisconsin Gazette hits the streets as the nation prepares to mark one of its annual milestones: Federal income taxes must be filed by April 15.

If 2014 is similar to the past two years, that’s also around the date you’ll be allowed to keep some of the money you’ve earned this year. According to the Tax Foundation, every penny earned by the average U.S. citizen before April 13, 2013, went to some form of the myriad taxes we pay.

We don’t oppose the principle of taxation. It’s a necessary evil to maintain the infrastructure needed to support the host of functions that separate contemporary life from that of hunter-gatherers.

We don’t want to live in a nation where people have to change their own streetlights, inspect their own food and pool resources to fix neighborhood potholes. Nor do we want those services given to politically connected businesses that will try to squeeze the maximum profits out of life’s necessities without accountability, except to their corporate backers.

But today we are taxed in more ways than you might realize, from “fees” to sin taxes to tolls. The U.S. tax code, which guides the mother of all taxes, is grossly unfair and confusing. Its dysfunctional collection agency, the Internal Revenue Service, wields absolute power over all but the wealthiest, who can afford pricey lawyers and accountants.

Our problem with the current tax code includes both its complexity and unfairness.

If paying taxes is an absolute duty, then tax collection should be a transparent and user-friendly process. Calculating taxes should be quick and simple, not the convoluted, expensive ordeal it’s become. 

Taxation should also be fair. It’s not fair when profitable corporations get tax rebates instead of paying taxes. Or when people who earn their income from investments that profit off other people’s labor get off tax-free, meaning the laborers not only make them rich but also carry their tax burden. 

Perhaps people are willing to tolerate  this rotten deal because they believe someday they’ll live in the manor and reap the same benefits. Setting aside the unworthiness of such aspirations, that’s not likely to occur. Thirty years of rule by corporate oligarchs has stacked the odds against that dream. Looking at a graph of the nation’s growing income inequality will burst that bubble.

Middle-class workers, including upper middle-class professionals and executives who fancy themselves rich, pay more than those who are actually rich. Very few people make enough money to qualify for the elaborate schemes and loopholes that prompted hotel magnate Leona Helmsley to snap, “Only the little people pay taxes.” 

One particularly insidious perk of the ultra-wealthy is their ability to park their money in overseas tax shelters by establishing shell corporations. An estimated 21 trillion to 32 trillion American dollars sit safely in tax havens around the globe while pundits paid by the rich try to deflect attention to the pittance paid for food stamps. 

We believe it’s past time for simplifying the tax code and making it more equitable. If our leaders can’t find a way to make taxation fair and functional, then we should elect people who will.

What are chances of IRS audit? A look at the numbers

The Internal Revenue Service audited less than 1 percent of the income tax returns filed last year. But your odds of getting audited vary greatly, depending on income.

Individuals

146 million returns.

Audited: 1.4 million.

Audit rate: 0.96 percent.

Income under $200,000

141 million returns.

Audited: 1.2 million.

Audit rate: 0.88 percent.

Income $200,000 and above

5.3 million returns.

Audited: 172,000.

Audit rate: 3.3 percent.

Income $1 million and above

363,000 returns.

Audited: 39,000.

Audit rate: 11 percent.

Business returns

10 million returns.

Audited: 61,000

Audit rate: 0.61 percent.

Small corporations (assets under $10 million)

1.8 million returns

Audited: 17,600.

Audit rate: 0.95 percent.

Large corporations (assets over $10 million)

62,300 returns.

Audited: 9,900.

Audit rate: 16 percent.

Marriage equality advocates demonstrate on Tax Day

Marriage equality advocates are demonstrating on April 15 around the country calling attention to the discrimination against LGBT people in federal and state laws on Tax Day.

Demonstrators, in actions sponsored by Marriage Equality USA, planned to rally at post offices, courthouses and clerk’s offices to protest state and federal laws that bar recognition of same-sex relationships and result in same-sex couples going by different tax rules.

There are more than 1,000 federal benefits associated with marriage that same-sex couples are denied, including the option to file a joint income tax.

Signs demonstrators were taking to protests said “Twenty-Five Years Together, Still Filing Single,” “No Taxation with Discrimination” and “Tax Us the Same, Treat Us the Same.”

“In light of the recent Supreme Court marriage equality hearings, it has never been more timely to stand up for equality and fairness,” said John Lewis of Marriage Equality USA. “Equal taxation is a founding principle of our nation, and a key issue in one of the marriage cases being deliberated by the nine Justices as we speak.”

Youth organizer Austin Bruckner is leading the event in his home town of Castro Valley, Calif. He said, “While the U.S. Supreme Court considers tax fairness for plaintiff Edie Windsor, it is important that people in my little town of Castro Valley know that LGBT couples are not treated equally on tax day. While our relationships may not be equal under the eyes of the law, they should be and soon they will be.”

In Davis, Calif., Ellen Pontac is organizing a demonstration with her wife, Shelly Bailes. Pontac said, 

Ellen Pontac, who will be leading the protest in Davis, California with her wife Shelly Bailes, Pontac said, “Same-sex registered domestic partners and same-sex married couples in California are required to fill out a total of four income tax forms when different sex married couples need to fill out only two – making tax time doubly cruel for same-sex couples.”

Events on the Marriage Equality USA schedule included an evening rally in at the Los Angeles International Airport post office and an afternoon demonstration at the post office in Castro Valley, Calif.