The IRS failed to audit former President Donald Trump’s federal tax returns for his first two years in the White House, even though an IRS program states the returns are “subject to mandatory review,” a newly released House committee report disclosed.
Trump filed tax returns in 2017 for the prior two tax years. However, the IRS did not start audits on the filings until 2019. And the tax agency started its audit on the same day the House Ways and Means Committee sought Trump’s tax returns and related audits, the report said.
Designated agents from the panel discovered only one mandatory audit was started and none were completed during Trump’s four years in office.
“Clearly, the mandatory audit program was dormant, at best, during the prior Administration,” the report said.
The IRS did not immediately respond to an email and phone call seeking comment.
Trump campaign spokesman Steven Cheung blasted Democrats for releasing the former president’s tax information. “This unprecedented leak by lameduck Democrats is proof they are playing a political game they are losing,” he said. Cheung did not immediately respond Wednesday to messages seeking comment on the delayed audits and congressional questions about tax writeoffs.
The findings and other concerns, including the IRS’ ability to handle complex tax returns filed by a president who came to the White House from a network of hundreds of businesses, emerged from the House Ways and Means Committee’s review of six years of Trump’s personal tax returns and some of his business returns, IRS audit records material and related material.
Other highlights of the report issued Tuesday night include:
- Trump paid $1.1 million in federal income taxes during the first three years of his presidency – and zero in his last year in the White House. He paid no federal taxes in the COVID-19-ravaged year of 2020 because he reported income losses of $4.8 million, according to the report prepared by the staff of the Joint Committee on Taxation and released by the Democratic majority on the House Ways and Means Committee.
- There were no indications that Trump “took steps to expeditiously and timely resolve outstanding tax issues while in office,” the report said. The audit files showed “continued disagreement with the examination facts,” and “efforts to
prolong the examinations.” - An internal IRS memo cited “some animosity” between an IRS counsel and one of Trump’s tax attorneys. Although the memo said an IRS manager did not believe the dislike was warranted, it said “animosity between the two does make the examination a little more difficult.”
- Another internal IRS memo hinted at potential difficulties in handling one of Trump’s tax filings. Noting the complexity of the return, the memo said to “do a thorough review of these returns we would need a team much larger than the current team.”
- The Ways and Means report and similar analysis by the Joint Committee on Taxation highlighted Trump tax return issues that need more review. They include taking business deductions for what should be personal expenses, claiming deductions for large charitable contributions in cash without documentation, and unusual loan arrangements.
The reports recommended replacing the IRS’ current program for auditing tax returns of American presidents and vice presidents with a new federal law that mandates such reviews.
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