(Bloomberg) -- Senator Bernie Sanders released a decade’s worth of his tax returns after years of resisting disclosure as he makes a second run at the presidency against Democratic Party rivals who are making financial transparency a litmus test for the campaign.
The returns show Sanders and his wife, Jane, earned more than $1 million in total income in 2016 and 2017. They earned $519,529 of taxable income in 2018, paying $145,840 in federal taxes for an effective rate of 28 percent. The Vermont independent, one of 18 declared candidates for the 2020 Democratic presidential nomination, reported income from his job in the Senate and more than $381,000 in income from book royalties in 2018.
His books earned him $875,000 in royalties in 2017.
In 2017, when the Sanders earned nearly $1.2 million, the couple’s highest-income year in the past decade, they paid an effective rate of nearly 32 percent.
“I consider paying more in taxes as my income rose to be both an obligation and an investment in our country," Sanders said in a statement issued with the returns.
The Sanders’s income has increased sharply in recent years as he earned more from book royalties and gained fame as a iconoclastic presidential candidate. From 2009 to 2015 the couple’s average income was about $281,000.
On their 2017 tax return, the Sanders checked the box indicating that they had a financial interest in or signature authority over a financial account located in a foreign country. But in an amended return signed earlier this month, they said that was a mistake and that they never had such an account in 2017.
The Sanders appear to have under-withheld last year – a common problem for many taxpayers adjusting to filing returns for the first time under the tax overhaul, which changed the withholding tables. Their 2018 return shows that upon filing, they owe the IRS $8,267, after having withheld $22,573 for federal taxes. They paid the rest of their liability in estimated quarterly payments.
Despite the drop in income last year, the Sanders fell squarely each year into the top 1 percent of wealthiest Americans, as defined by a May 2018 study based upon the 2014 tax year by economists Thomas Piketty, Emmanuel Saez and Gabriel Zucman. Taxpayers needed income of at least $458,000 and less than $1,960,000 to be in that group.
Their most recent return listed $41,764 in deductions -- slightly below average for their income level, according to IRS data for 2014, the most recent year available. The new law limited the ability of taxpayers to itemize deductions by nearly doubling the standard deduction, to $12,000 for single taxpayers and $24,000 for married taxpayers who file jointly.
In 2018, the Sanders’ paid $65,086 in state and local income taxes and property taxes on two homes in Vermont and one in Washington D.C.; that deduction is now capped at $10,000 under the new law. They also paid $12,814 in home mortgage interest.
The Sanders gave $18,950 to charity in cash and other gifts in 2018, a little more than half of their $36,300 in giving in 2017. The Sanders gave $10,600 in 2016 but before that, their yearly giving never topped $10,000.
Sanders’s book royalties were larger than many of his 2020 rivals. Elizabeth Warren reported nearly $325,000 in income from her book. Kirsten Gillibrand reported about $50,000 of book deal profits. Since 2016, Sanders has published three books, including “Our Revolution: A Future to Believe In,” which he used to launch his last presidential bid.
“If anyone thinks I should apologize for writing a best-selling book, I’m not going to do it,’’ Sanders said Monday at a townhall event hosted by Fox News.
“Sanders shouldn’t feel ashamed for making money,” said Morris Pearl, chairman of the Patriotic Millionaires, a group of wealthy individuals that advocates for progressive tax policies. “The system is rigged in our favor and we should do more to correct that.”
The senator refused to release his full tax returns when he ran for the nomination against Hillary Clinton in 2016. He’s contending again as one of the front-runners, and is attempting to manage the disconnect between his decades of rhetoric about the political power wielded by the wealthy and his own position within that group.
When he ran against Clinton, Sanders released a lone return, from the 2014 tax year. Since then, Sanders has gone from a small-state senator with ideas mostly seen outside the mainstream, to one of the most recognizable politicians in the U.S.
Sanders now joins several other 2020 Democratic hopefuls who have released at least 10 years worth of tax returns, including Senate colleagues Warren, Amy Klobuchar and Kirsten Gillibrand and former Representative Beto O’Rourke. The release of tax documents has taken on added importance for the Democratic candidates who are drawing a contrast with President Donald Trump, who has refused to release his tax returns despite longstanding practice.
Sanders has several tax proposals that could increase his own liability. In 2016, he campaigned on increasing the top individual tax rate to 52 percent. He also has a plan that would apply the estate tax to individuals worth at least $3.5 million.
(Updates with Sanders’ remarks at Fox News townhall in 14th paragraph.)
To contact the reporters on this story: Laura Davison in Washington at email@example.com;Joe Light in Washington at firstname.lastname@example.org;Lynnley Browning in New York at email@example.com
To contact the editors responsible for this story: Wendy Benjaminson at firstname.lastname@example.org, Joe Sobczyk
For more articles like this, please visit us at bloomberg.com
©2019 Bloomberg L.P.