Raiders of the Trump Refund

Much of the tax information the House wants Trump to fork over is already in its possession. But it's not allowed to peek.

The treasure which you think not worth taking trouble and pains to find, this one alone is the real treasure you are longing for all your life. The glittering treasure you are hunting for day and night lies buried on the other side of that hill yonder.

—B. Traven, epigraph, Der Schatz Der Sierra Madre (1927)

I don’t think I’m the first to observe that the final scene in Raiders of the Lost Ark can be read as a sort of mini-allegory about investigative reporting. (Didn’t Ron Rosenbaum make this point somewhere?) I thought about this scene (and also, of course, B. Traven’s novel and the film that John Huston adapted from it) when I read the New York Times’s new blockbuster story about Donald Trump’s taxes.

In Raiders (which, as it happens, premiered when I was a young journalist in Washington), various parties have been scampering across the globe to find the Ark of the Covenant, a gilded chest that contains the stone tablets Moses brought down from Sinai. After Indiana Jones finally brings the sacred Ark back to the United States (where such an artifact, it needn’t be explained, is destined to reside), we see this holy relic, which has the power to melt Nazi faces, getting boxed inside a wooden crate stamped “Army Intel” and “Do Not Open” and wheeled inside an unimaginably vast government warehouse.

The scene is a nod to the ending of Citizen Kane, except that instead of seeing the MacGuffin tossed into an incinerator, we see it placed among tall stacks of other near-identical top secret wooden crates, where it is sure to be forgotten. For journalists, the message is plain: That thing you’re looking for is gathering dust someplace in a government facility where you could get it if only you, or the government, knew it was even there.

The political MacGuffin of the past four years has been Donald Trump’s tax filings, some portion of which the New York Times appears to have acquired for the years leading up to 2018. The Times report reveals that the president paid only $750 in taxes in 2016 and 2017, among other tidbits, but the most intriguing revelation is that the Internal Revenue Service audit that Trump has used as an excuse not to release his taxes actually exists. (His claim that the audit prevents him from making the documents public remains false.)

The audit concerns a $72.9 million refund that Trump claimed on his 2009 return to cover $700 million in losses. If Trump loses the audit, he’ll have to pay in excess of $100 million. And the Times account strongly implies that he will lose the audit. The losses concern Trump’s abandonment of the partnership that owned his Atlantic City casinos, over which he’d lost control. That entitled him to claim the $72.9 million refund, but only if he never again earned money on the casinos. But it turns out Trump probably did earn money on the casinos, because when they were liquidated he was given 5 percent of the stock in a successor company. If that stock was worth anything at all, his losses must be logged not as $700 million but as $3000. Bye-bye refund!

It’s pretty interesting that the IRS, whose budget Trump’s Republican party spent the past decade cutting by 20 percent, has been trying throughout Trump’s presidency to figure out whether the boss owes it $100 million. One can easily imagine that it’s in no hurry to resolve the matter.

But it gets better. To keep any refund bigger than $2 million, Trump needs approval from the congressional Joint Committee on Taxation. The committee gave at least tentative approval in 2014, but further audits from the IRS sent the paperwork back to the Joint Committee in the spring of 2016 … while Trump was running for president. There it has remained for four years.

“House Democrats,” the Times piece notes,

who have been in hot pursuit of Mr. Trump’s tax returns most likely have no idea that at least some of the records are sitting in a congressional office building. George Yin, a former chief of staff for the joint committee, said that any identifying information about taxpayers under review was tightly held among a handful of staff lawyers and was rarely shared with politicians assigned to the committee.

To review:

1.) The House wants Trump’s tax records.

2.) The House has Trump’s tax records, or anyway documents concerning some of the most interesting parts.

3) The House can’t look at them.

We can’t see the Ark because it’s inside a government warehouse inside a wooden crate marked “Do Not Open.” Where’s Indy when you need him?