Donald Trump vs. the Suckers Who Pay Their Fair Share of Income Taxes

A deep and disturbing dive into IRS data shows just how much of a break Trump got compared to poor and working-class Americans

We need a reality check.  The news earlier this week that Donald Trump, who earned $434 million in 2018, paid little or no federal income taxes for years was staggering.  And those revelations are even more shocking when we compare what Trump paid in federal income taxes to other Americans.  Even when he paid a small income tax in 2016 and 2017, it was less than the taxes paid by nearly 90 million American households with incomes greater than $25,000

When Trump filed his 1040 forms in 10 of the 15 years from 2000 to 2015, he joined a group comprised mainly of working poor families that owe no federal income tax.  And when he paid $750 in income tax in 2016 and 2017, he joined Americans who earned on average $20,000 to $25,000, including fast-food workers, amusement park attendants, and gambling dealers.   In every instance, Trump leveraged real estate write-offs and losses to zero out all or virtually all of his taxes on incomes of tens and hundreds of millions of dollars – and went to court countless times to keep it secret.

To fully grasp the enormity of Trump’s tax dodges requires a deep dive into IRS databases.

They show that in 2019, the IRS received 153,774,296 income tax returns from American individuals, couples, families, and households for income earned in 2018.  That number doesn’t include most poor and very modest income Americans who didn’t have to file a 1040 form, because they earned less than the standard deduction of $12,200 for individuals and $24,400 for couples.  The number does include 53,359,786 Americans with very modest incomes who filed their income tax forms even though they reported no taxable income. It also includes Donald Trump in 10 out of 15 years.  Everyone else? They were mainly working-poor families who filed a 1040 in order to claim the Earned Income Tax Credit, plus those with incomes just above the standard deduction, but not enough to owe income tax after taking account of tax credits for their children, child care, and perhaps some small savings.

In 2016 and 2017, as noted, Donald Trump did ante up a miserly $750 for the IRS.  Those tax payments put him in the lower half of the IRS group of 5,131,634 households with taxable incomes of $20,000 to $25,000, who paid an average of $994 in income tax.  Again, for perspective, $20,000 to $25,000 was the average wage income last year of cashiers and theater ushers as well as cooks and dishwashers at Taco Bell and McDonald’s.

That leaves 87,416,451 American households who had taxable income incomes greater than $25,000 and so paid more federal income tax than Donald Trump.

If you were one of the 19,121,652 individuals, couples, or families whose taxable income in 2018 was $50,000 to $75,000 – the average for flight attendants, correctional officers, postal service workers, and athletic trainers last year — you paid on average $4,688 in federal income tax.  That was 6.3 times as much as Donald Trump.

If you were one of the 13,149,633 American households with taxable incomes of $75,000 to $100,000 in 2018 – the average for dental hygienists, registered nurses, accountants, and bank loan officers – you paid almost ten times as much in federal income tax as Donald Trump.

It will take investigators a long time to determine whether Trump legally avoided or illegally evaded tax bills on hundreds of millions of dollars in income.  Whichever it was will not change this bottom line: As president of the United States, Donald Trump demonstrates his contempt for many tens of millions of American taxpayers who pay more for the nation’s defense and welfare than their billionaire chief executive.  Here are the pertinent IRS data that prove it.

 

 Taxable Income Number of returns Average Tax Ratio to $750
$20,000 under $25,000 5,131,634 $994 1.3
$25,000 under $30,000 5,365,983 $1,369 1.8
$30,000 under $40,000 10,584,232 $2,057 2.7
$40,000 under $50,000 9,693,8668 $2,859 3.8
$50,000 under $75,000 19,121,652 $4,688 6.3
$75,000 under $100,000 13,149,633 $7,390 9.9
$100,000 under $200,000 20,976,903 $15,277 20.4
$200,000 under $500,000 6,882,287 $47,559 63.4
$500,000 under $1,000,000 1,104,444 $156,431 208.6
$1,000,000 under $1,500,000 241,068 $313,160 417.7
$1,500,000 under $2,000,000 98,248 $464,253 619.0
$2,000,000 under $5,000,000 141,489 $816,360 1,088.5
$5,000,000 under $10,000,000 34,646 $1,872,196 2,496.3
$10,000,000 and more 22,010 $7,386,572 9,848.8
All Incomes 100,414,509 $15,322 20.4

 

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Robert J. Shapiro

Robert J. Shapiro, a Washington Monthly contributing writer, is the chairman of Sonecon and a Senior Fellow at the McDonough School of Business at Georgetown University. He previously served as Under Secretary of Commerce for Economic Affairs under Bill Clinton and advised senior members of the Obama administration on economic policy.