It will take time for lawmakers and the public to digest the trove of documents relating to former President Donald Trump’s tax returns released Tuesday night by the House Ways and Means Committee. Trump repeatedly defied convention and refused to release his tax returns both as a presidential candidate and as a sitting president. The committee, which is responsible for IRS oversight and writing tax policy, had long sought and finally obtained just a few weeks ago Trump’s tax returns for 2015 through 2020. Its stated aim was to review “how the IRS enforces the federal tax laws against, and ensures compliance by a president.” Here are some of the top initial takeaways from the committee’s report, which includes both its analysis of the IRS presidential audit program and an analysis of Trump’s returns by the nonpartisan Joint Committee on Taxation. Committee says IRS failed to properly audit Trump The Ways and Means Committee asserts that the IRS presidential audit program was “dormant” during Trump’s term. The report found that during Trump’s time in office the IRS opened only one “mandatory” audit – for his 2016 tax return. And that didn’t take place until the fall of 2019, after Chairman Neal first sent a letter asking the IRS for Trump’s returns and tax information. It also notes that the agency had opened an audit earlier that year for his 2015 return but it was not designated as mandatory. The 2017 tax return, meanwhile, was marked as “evaluated and picked up for examination, if necessary.” It remains unclear why the IRS wasn’t more active in auditing Trump’s returns while president. “Despite knowledge of an ongoing Congressional investigation and the Manual, no priority was given to the mandatory audit program by the prior Administration,” the report asserts. Sen. Ron Wyden, who chairs the tax writing committee in the Senate, said Wednesday “the IRS was asleep at the wheel, and the presidential audit program is broken. There is no justification for the failure to conduct the required presidential audits until a congressional inquiry was made. I have additional questions about the extent to which resource issues or fear of political retaliation from the White House contributed to lapses here.” Many Democrats, including those on the committee, as well as tax policy experts suggest that a lack of resources, including manpower to handle highly complex audits like those of Trump, may also be a factor. “It’s easy to find the IRS deficient. They’re starved for resources. Rich guys can take advantage of the tax law because the IRS doesn’t have the resources to go after them,” said Steven M. Rosenthal, senior fellow in the Urban-Brookings Tax Policy Center at the Urban Institute. CNN reached out to the IRS, which did not have an immediate comment. Trump paid no federal income taxes in his last year as president After years of carrying forward big losses to greatly reduce if not zero out his federal income tax liability, Trump reported a considerable tax bill in the middle two years of his presidency, according to tables in the JCT report. Trump paid a combined $1.1 million in federal income taxes in 2018 and 2019, a stark contrast to the $750 he paid in 2017 and $0 in 2020. His taxable income in 2018 neared $23 million, which included a $22 million capital gain. The next year, he reported close to $3 million in taxable income, with a capital gain of $9 million. However, in 2020, Trump reported losses of over $16 million, large enough to reduce his federal income tax bill that year to $0. For many years, prior to his running for president, a New York Times investigation showed that Trump had claimed huge net operating losses that he was allowed to carry forward and apply to future tax years, which greatly reduced or simply wiped out his annual income tax liability. “It’s the 2,000-pound gorilla. … He still uses the net operating losses to reduce his tax liability,” Rosenthal said. For example, the JCT noted that Trump carried forward $105 million in losses on his 2015 return, $73 million in 2016, $45 million in 2017 and $23 million in 2018. Questions raised about Trump’s charitable deductions The JCT report raises questions about the accuracy of some huge charitable deductions Trump claimed on several of Trump’s tax returns. Deductions can limit the amount of income tax owed. In 2015, Trump claimed a $21.1 million deduction for donating 158 acres of his 212-acre property called Seven Springs in North Castle, New York. The donation, which was made to a land trust, is a focus of the Manhattan district attorney’s criminal investigation of the Trump Organization’s finances. The IRS allows an income tax deduction for owners who give up rights to their land for the purpose of conservation, but the IRS has raised questions about whether the value of Trump’s land donation was inflated. The JCT report noted that an IRS agent assigned to audit Trump’s taxes suggested disallowing the entire $21.1 million deduction because Trump did not get a qualified appraisal for the land. The agent alternatively suggested reducing the value of the deduction by more than half and said the appraiser may be subject to a fine for potentially misstating the value of the land. Since Trump did not have any taxable income in 2015, the deduction was limited – but it can be carried forward and deducted in future years. The IRS audit of the Seven Springs donation is ongoing. A site visit occurred in January and agents met with appraisers as recently as November, according to the JCT report. The report also raised questions about cash donations that Trump claimed as charitable deductions. In 2016 and 2017, Trump claimed nearly $1.2 million and $1.9 million, respectively, in charitable contributions, the bulk of which were made in cash. Trump, again, had no taxable income in either year, but he was able to carry forward the deduction to future years, further limiting the amount of federal income tax he had to pay. The JCT said the large cash contributions merited a review. Trump had taxable income in 2018 and 2019 and reported cash donations of just over $500,000 each year. That means he was able to claim a charitable contribution deduction those years. The JCT suggested Trump should be asked to substantiate those large cash donations. The JCT report authors wrote that while it identified a number of items worth of examination, they “express no opinion whether the examination of those items would have resulted in any proposed tax increases.” IRS notes ‘history of difficult negotiations’ with Trump’s team Shortly after The New York Times published a blockbuster story on September 27, 2020, that detailed Trump’s tax returns, the IRS met internally to discuss how to manage a review of the then-president’s taxes. During the meeting, mention was made of the “history of difficult negotiations” between IRS staff and Trump’s lawyers, according to the JCT report. IRS regulators also laid out a strategy at that meeting for evaluating Trump’s finances, setting criteria to make the process manageable given the large number of pass-through entities. Trump’s trust has ownership of various pass-through entities, the income and deductions of which flow to Trump’s federal income tax return. In March 2021, the IRS contacted Trump’s representatives that an audit had begun for his 2017 and 2018 tax returns. Around this time, Trump’s team called the IRS to discuss the size of the team evaluating the tax returns. Three agents were assigned, compared to the typical single agent. The IRS team manager explained to Trump’s representatives that the agency had deemed the 2017 tax return as “high risk,” requiring additional team members to examine the more than 400 flow-through entities. The examination would represent most or all of the three IRS agents’ case loads. Trump’s team also expressed concern about the scope of the review, which looked back as far as 2014 because of deductions that Trump claimed in that year that carried over and reduced his tax burden in subsequent years. What’s next: Committee plans to release Trump’s actual returns The Ways and Means Committee said it intends to release the Trump tax returns at issue in its report. The release could come in a matter of days. First, Neal said, sensitive personal information such as Social Security numbers and account numbers must be redacted. Meanwhile, Neal has proposed legislation that would codify the mandatory audit program “to require the IRS to conduct mandatory audits while a President is in office and publicly disclose related returns and return information.” House Speaker Nancy Pelosi said the House will “move swiftly to advance” that bill. Swiftness will be required if the bill is to pass and become law. The Democrats hand over control in the House to the Republicans on January 3.