TONYA MOSLEY, HOST:
President Trump is on the defense after last night's bombshell report from The New York Times analyzing 20 years of his tax returns, the documents that, for years, Trump has refused to release and fought in court to keep secret. On Twitter today, the president wrote, quote, "I paid many millions of dollars in taxes but was entitled like everyone else to depreciation and tax credits." Among the many revelations in The Times report is the fact that Trump paid just $750 in income taxes in 2016 and 2017, his first year in the White House. WNYC's Ilya Marritz has been reporting on Trump's business dealings for years as co-host of the podcast "Trump, Inc."
Welcome.
ILYA MARRITZ, BYLINE: Good to be here.
MOSLEY: So, Ilya, we've had 24 hours to process this information. You've been steeped in the president's financials for years. What jumps out to you most?
MARRITZ: I think of it almost like a three-stage thing, right? So the initial headline of the $750 dollar tax bill for those two straight years, including Trump's first year in the White House - that is shocking. Many, many, many of us, including me, pay a lot more in taxes than that and are not nearly as rich as the president.
But if we look at the bigger picture, what we see actually is that the president also went to extraordinary lengths to reduce his tax bill. And that's a big finding from the - this trove of information that The New York Times unearthed. We saw all kinds of envelope-pushing measures that the president took to reduce his tax bill, for example, classifying as a business expense local taxes paid on a big mansion in Westchester, north of New York City. Well, that mansion is not actually a business. It's not a property that he's renting out. It's actually just a home for the Trump family. And yet it appears that Donald Trump did deduct those taxes paid, saving himself millions of dollars. There's a lot of examples like that in this story.
Taking one step even further back, the thing that really strikes me is what the public believed about Donald Trump when he took office and what we now know. What the public believed and the image that that Trump put out was that he was a very successful businessman, very wealthy, self-assured, secure. What we see from the Times reporting is that his business is unstable, and he faces a number of big squeezes and problems up ahead that could confront him as president if he's reelected.
MOSLEY: I want to ask you more about those tax credits. But first, I want you to describe for us how it happened that he didn't pay income taxes for so long.
MARRITZ: Yeah. I mean, it's hard to understand if you aren't already very wealthy and don't have a lot of assets and a lot of different businesses. But the basic principle here is that if you show a loss on a business - and President Trump has had some very big losses on some of his businesses - you can basically reduce your tax bill down to zero. And that is what President Trump apparently did for many, many years. It would seem like a head scratcher that he could still be rich after reporting so many enormous losses. But, in fact, he is still rich. But he's used those business losses to reduce his own tax bill.
MOSLEY: One of the most striking revelations in this Times report is the fact that Trump has personally guaranteed some $300 million in loans that are coming due in the next few years. What is known about those loans?
MARRITZ: I'm really glad you mentioned this because this, from a national security standpoint, is probably the most worrying thing to a lot of people who study this stuff closely. Basically, Donald Trump started taking out a number of really large loans not too long before he began his run for president. So for example, on the retail space on Trump Tower, you know, one of his very first buildings from the early 1980s - suggests he may have had a cash squeeze, you know, around that time, say 2014, thereabouts.
In any case, the total debts that we're talking about are north of $400 million. Much of that money would come due in his second term if he's reelected. And he gave a personal security for those loans, which means that if he fails to repay them, it is thinkable that a bank, a bank like Deutsche Bank or a bank like Ladder Capital, could actually come after the assets of the president of the United States and try to reclaim them.
The reason it's concerning from a national security standpoint is it's very likely that foreign powers have known about this kind of vulnerability for some time, and they can seek to exploit it. The more avenues - the more pieces of business that a sitting U.S. president has, the more ways there are, the more pathways there are for a foreign power to try to understand him and potentially to try to influence him.
MOSLEY: Do we know anything about who he borrowed money from?
MARRITZ: Well two of his biggest lenders are Deutsche Bank, which - a lot of ink has been spilled on Deutsche Bank - and Ladder Capital, which is a bank here in New York City. What I think is an interesting question - it's not addressed directly in this Times story, and I'm curious whether it'll come up in any of their subsequent reporting - is who holds that debt now and whether the debt was essentially syndicated and sold off to other parties. There've been rumors and speculation about that for a long time. I don't think we really know definitively. That's one of the things that this tax information has not settled.
It's worth remembering the tax information - you know, these are President Trump's tax returns certified by him. They're not an independent financial audit. They tell us a lot, but they don't tell us everything about his wealth and his assets.
MOSLEY: You know, this report serves as an exhaustive list of the ways that the very rich can dramatically reduce their income tax burden or even pay no income tax at all. How prevalent is this? I mean, dl Trump's efforts to reduce his tax burden stand out from other wealthy Americans?
MARRITZ: It's interesting because as my colleagues at ProPublica have shown, over the last few years, IRS enforcement has gone down and down and down. And the places where it now happens the most are among the poorest Americans. Now, those are easy people to audit. It's much harder to do a full and thorough audit on very rich people, like the president of the United States, who, by the way, is facing audit right now. And the result of that audit could eventually slap him with a tax bill somewhere in the neighborhood of $100 million if it doesn't go his way.
I don't know, honestly. I think, you know, a lot of rich people do a lot of things to avoid taxes. And tax avoidance is not the same as tax evasion. But what I think we see here from this reporting is a number of places where prosecutors will want to look, where journalists are going to want to spend more time looking and where it looks likely that the Trump Organization did indeed cut corners or resort to creative interpretations that a court or the IRS might find in violation of the law or in violation of the tax code.
MOSLEY: Ilya Marritz is co-host of WNYC's podcast "Trump, Inc."
Thank you so much.
MARRITZ: You're very welcome. Transcript provided by NPR, Copyright NPR.