In the final presidential debate, Donald Trump again said that Warren Buffett claimed a major deduction on a tax return, repeating a claim the Republican nominee made in the second debate in St. Louis.
This was despite the fact that Buffett responded publicly to Trump the first time, saying he had never claimed the kind of deduction to which Trump was apparently referring.
“I know Buffett took hundreds of millions of dollars,” Trump said Wednesday, in the context of a discussion on his use of losses from past years to reduce the income he declared in future years and the taxes he apparently owed on that income. Buffett said in a statement he had not used that maneuver.
In principle, experts on taxation say that there is nothing wrong when an entrepreneur or investor counts past losses against future income. Taxes are based on income, and there is widespread agreement that it makes sense to tax investors on their average income over a period of several years.
On the other hand, many experts have questioned whether Trump really lost all the money he claimed to have lost. In the past, taxpayers have sometimes been able to claim losses on paper that do not exist in reality. Generally speaking, such paper losses result when taxpayers take out loans, and then lose their banks’ money, not their own.
According to documents published by the New York Times, Trump declared a loss of $916 million in 1995 — a colossal amount of money. Because Trump has not released his tax returns, unlike previous presidential candidates, it is unclear whether this amount represented a real economic loss for him.