One year of Trump’s tax returns were just revealed. Now we know why he won’t release the rest.

Trump’s tax gambit, revealed.

Screenshot via New York Times
Screenshot via New York Times

Someone sent an envelope to the New York Times with the key pages of one year of Trump’s tax returns, 1995. The pages revealed that, that year, Trump claimed over $900 million in losses.

That means Trump could have made over $50 million a year for nearly two decades and paid nothing in federal taxes. (The I.R.S. lets taxpayers apply loses for up to 18 years to offset future and past income.)

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The losses stem from “a dizzying array of deduction, business expenses, real estate depreciation, losses from the sale of business assets and event operating lawsuits” that flow from various entities control by Trump to his “personal tax returns.”

The blockbuster disclosure is likely to be a focus of the presidential race’s final five weeks. There are a few things to keep in mind as the story plays out.

The was no audit pending on these returns (and many other years)

Trump’s 1995 tax returns are not under audit and, by his own admission, neither are any tax returns filed prior to 2009. This is a letter released earlier this year by the Trump campaign.

Trump could release them all, now, and show exactly how much he paid in taxes from 1995 through 2008.

There is no evidence from the IRS that Trump is, in fact, under audit for any year. But Trump’s accountant wrote the letter above claiming he is under audit from his 2009 return forward.

An audit, however, does not prevent someone from releasing tax returns.

Trump views paying no taxes as a sign of intelligence

The key moment in the first presidential debate was Trump claiming that his ability to avoid paying any taxes makes him “smart.”

Trump continued this approach in responding to the New York Times story. He did not deny that Trump’s 1995 return enabled him to avoid paying taxes for many years. Rather, a statement from the Trump campaign described Trump as “a highly skilled businessman” with a duty to “pay no more tax than legally required.”

“Mr. Trump knows the tax code far better than anyone who has ever run for President,” the statement concluded.

Of course, if he really believed not paying taxes made him look good, he could have released these returns himself.

Trump appears to be taking the opposite approach. His lawyer threatened to sue the New York Times if they printed the story.

Trump has also publicly criticized others for not paying taxes.

Trump may have a mole

The New York Times reported that they received these documents in an envelope mailed from New York City with a return address of Trump Tower.

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Someone can, of course, write whatever they wish as a return address. But tax documents are sensitive material and would be extraordinarily difficult to obtain without inside access.

UPDATE (10:22PM): The Trump campaign released a statement on the disclosure of his 1995 tax returns.