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Billionaire businessman Mark Cuban thinks Donald Trump’s most brilliant move has been to avoid releasing his tax returns.
“The smartest thing he’s ever done is not release them because he’s created a talking point that just consumes more time so that he doesn’t have to talk about anything of importance,” Cuban told Business Insider in a Monday interview.
Cuban added that “we already know” what Trump’s taxes would show regarding charitable donations, crediting Washington Post reporter David Fahrenthold for having already “ripped him apart” on it.
Fahrenthold recently wrote of how Trump used his charity as a vehicle to spend other people’s money.
“So maybe his tax returns confirm or maybe they contest what he said,” Cuban said. “But we already know he’s full of s— on tax returns on charity, right?”
Cuban mentioned the ongoing scandal regarding the Trump Foundation’s illegal 2013 campaign donation to Florida Attorney General Pam Bondi, which has received increased attention recently after the Internal Revenue Service recently slapped the charity with a $2,500 fine. The Washington Post found that the foundation did not list the contribution in its tax filings, and Trump later reimbursed the foundation for the donation.
A Trump Organization senior vice president told The Post that it was “an honest mistake” that the contribution wasn’t properly listed.
Bondi at the time was considering whether to take up a fraud investigation into the now-defunct Trump University. She decided against doing so.
“He tried to cover up the foundation’s donation to Pam Bondi, and you know, the cover-up hasn’t been worse than the crime, but that’s OK, we already know,” Cuban said. “So what are his tax returns going to tell us? The operational quality or earnings of his businesses on his K-1s?”
“Well we know he’s in real estate, so we know he’s going to have huge losses and he’s going to work it that way,” he continued. “I think maybe, if he gave them, all we’re going to do is argue about the quality or what they mean, which again means not dealing with any other issue. It’s just stupid. I get why everybody is doing it, but at the same time, it doesn’t really accomplish anything.”
Cuban also said he “could care less” about Trump’s running mate, Gov. Mike Pence of Indiana, recently releasing 10 years of his tax returns to the public, adding that Trump would almost certainly never release his tax returns.
“Why would he?” Cuban asked.
The Manhattan billionaire has repeatedly said he will release his returns once an audit from the IRS is completed. That may not happen before the election, Trump has said.
All major-party presidential nominees since 1976 have made their tax returns public.
- Business Insider
Late last month, Cuban provided a different take on Trump’s refusal to release his tax returns, using a 2013 deposition from Trump – uploaded by The Washington Post as a part of its “Trump Revealed” project – to make his point.
In that deposition, Trump said in response to a question about the development of Trump properties in Las Vegas and Chicago that he set up single-use subchapter S corporations to develop projects. He said he did not use the Trump Organization for those types of projects.
As Cuban pointed out, with an S-corporation, “the entire financial performance of his company becomes part of his tax return.”
According to the IRS, S-corporation shareholders must “report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates.” And S-corporations are responsible “for tax on certain built-in gains and passive income at the entity level.”
“His personal tax returns would show the financial performance of his development projects,” Cuban wrote. “Not good given how much he gets sued.”
“It may also explain why reducing pass-through taxes is important to him,” he continued. “I say ‘may’ because taxes are only paid if he makes a profit.”
Democratic presidential nominee Hillary Clinton recently hit Trump in a major economic speech for his new tax position on what is known as pass-through income, calling it the “Trump loophole” and arguing that the tax break would be extremely beneficial to Trump.
Pass-through income “passes through” the business to the individual returns of its owners. CNBC’s Robert Frank cast the loophole as the biggest tax break for the wealthy in Trump’s plan. Though analyses have shown that a plan similar to Trump’s would aid small businesses, most of its benefits would go to wealthier business owners.
Pass-through income today is taxed at individual rates, with a ceiling of 39.6%. Trump’s plan slashes the tax rate for this income to 15%.
An analysis by the Center on Budget and Policy Priorities showed that the vast majority of pass-through income goes to the top 1% of earners, with the top 400 earners in 2013 acquiring 20% of their total income this way. For those 400 people, that came out to slightly more than $94 million each on average.
Cuban endorsed Clinton at a rally in Pittsburgh, his hometown, in July.