The New York Times recently published an article that suggested Donald Trump might have avoided paying taxes for nearly two decades. During the second presidential debate, Trump admitted he had taken advantage of existing tax laws to avoid paying taxes. While many hard-working Americans lament Trump’s actions, I don’t think he did anything illegal.
According to the original New York Times article, Trump had filed a shocking $900 million loss that resulted from his failed business ventures: three Atlantic City casinos, Trump Airline and the Plaza Hotel in Manhattan. This loss enabled him to take advantage of a tax loophole called the net operating loss. According to accountingtools.com, a net operating loss (NOL) allows losses from a business to be transferred to the owner’s personal tax returns balance sheet.
These losses can then be used to cancel out future taxable income. The New York Times article alleged that since Trump filed almost a billion dollars in deductions, he could have avoided paying federal income tax for eighteen years.
Is it ethical for a presidential candidate to not pay taxes? Many Americans say no. According to tax experts hired by the New York Times, the suspected amount that Trump avoided paying in taxes is $500 million. Some argue that amount of money could make strides in the education, military and employment sectors and so on. However, I believe that Trump is not in the wrong, he simply made full use of our nation’s laws.
People may argue that Trump is hurting the economy by not contributing to its growth, but this is not true. According to PrivCo, a private-company research organization hired by CNN Money to investigate the Trump Organization, the Trump Organization employs at least 34,000 people and these employees pay taxes.
The funds Trump obtained from not paying taxes could have been channeled into the business and in turn into his employees. Though Trump does not pay federal income tax, he does pay millions in business taxes, licenses, property tax, etc.
Former New York mayor, Rudy Giuliani during an interview with CNN’s Chris Cuomo said that Trump simply took advantage of the existing tax code and used it to help himself and the people he supports.
“The man’s a genius,” Giuliani told Cuomo. Trump assessed his situation and decided on the most beneficial option, a quality that is not undesirable in a president.
Rather than focusing on a candidate’s tax returns, voters should pay more attention to both candidates’ policies on immigration, education, health, terrorism and the root of this dilemma, tax reforms.