NEW YORK �� Donald Trump was an "absolute genius" for reporting a $916 million loss on his 1995 tax returns, a move that cleared the way for Trump to pay no federal income taxes for as long as 18 years, Rudy Giuliani said Sunday.
"This is a perfectly legal application of the tax code, and he would've been a fool not to take advantage of it," the former New York City mayor and Trump ally said on ABC's "This Week."
Giuliani's remarks came in response to a New York Times report that revealed the tax benefits that Trump derived from mismanagement of his Atlantic City casinos, his failed airline business and his poorly timed purchase of the Plaza Hotel in Manhattan.
Trump is the first major presidential candidate since the 1970s to refuse to release his tax returns, but the Times obtained pages from his 1995 filings.
Sen. Bernie Sanders, I-Vt., who supports Trump's Democratic rival, Hillary Clinton, said the Times report exposed a corrupt and absurd tax system that favors billionaires over ordinary Americans who carry the burden of funding public schools and the military.
"Trump goes around and says, 'Hey I'm worth billions, I'm a successful businessman, and I don't pay any taxes, but you, you make 15 bucks an hour, you pay the taxes _ not me,'" Sanders said on CNN. "That is why people are angry and want real change in this country."
Giuliani said Trump's comeback from financial failures _ which included six business bankruptcies that left many of his vendors unpaid _ strengthen his qualifications to be president. Giuliani recalled the career setbacks of Apple founder Steve Jobs and Winston Churchill.
"Every great man has had failures," Giuliani said.
With his vast network of partnerships and limited liability corporations, Trump had a fiduciary duty to his investors, forcing him to minimize his personal income taxes, Giuliani said. "If he didn't do it, he'd get sued," he said.
Asked whether Trump bears any responsibility for what the candidate calls the "third-world" state of America's deteriorating airports, harbors and highways, Giuliani said, "Absolutely not. The law is responsible for it."
Trump has said he would release his most recent tax returns when the Internal Revenue Service completes an audit, but the IRS says all taxpayers are free to make their returns public regardless of any audit. New Jersey Gov. Chris Christie said Trump had good reason to withhold not just the returns being audited, but those from other years as well.
"They're all connected, because of the byzantine tax laws," Christie said on Fox News.
