Cary Spivak

Milwaukee Journal Sentinel

MILWAUKEE — Billionaire Diane Hendricks, the richest woman in Wisconsin and a vice chair of the Trump Victory fundraising committee, didn't pay a dime in state income tax from 2012 through 2014, records obtained by the Milwaukee Journal Sentinel show.

Hendricks, 69, has a net worth of nearly $5 billion, according to an estimate by Forbes Magazine, which this month named her "America's Richest Self-Made Woman" — edging out Oprah Winfrey, who the magazine said had a net worth of $3.1 billion. Judy Faulkner, founder and CEO at Epic Systems Corp., a Verona health care software company, came in third with an estimated net worth of $2.4 billion.

Hendricks, co-founder and owner of ABC Supply Co. — the nation's largest supplier of roofing — also owed no state taxes in 2010, meaning she paid no Wisconsin income taxes in four out of five years. The company, which she founded with her husband, Ken, in 1982, posts annual sales of about $6 billion. Ken Hendricks died in 2007.

State records show Hendricks, who is now chairman of ABC Supply, paid $290,415 in Wisconsin income taxes in 2011. In addition, Scott Bianchini, ABC Supply tax director, said Hendricks paid $7.6 million in state income taxes for last year.

There is no public record of that 2015 payment since Hendricks received an extension to file the return. "You'll be able to verify that next year," Bianchini said.

Trump Victory team

Republican National Committee Chairman Reince Priebus in May named Hendricks to the leadership team for Trump Victory, a committee that will raise funds for Donald Trump's presidential campaign, the RNC and 11 state GOP committees.

She has been a major ally and contributor to Gov. Scott Walker, pouring $5 million into a super PAC that was formed to support the Republican governor's failed presidential bid. She also gave $500,000 to Walker's 2012 recall campaign.

Hendricks garnered unwanted attention in 2012 when she was caught on a videotape showing her talking with Walker about using a "divide and conquer" strategy toward unions.

Hendricks' string of goose eggs on her tax returns could throw her into the spotlight again.

"It's an exhibit that works in this era of bumper sticker slogans," said Mordecai Lee, a former Democratic state legislator who now teaches at the University of Wisconsin-Milwaukee. "Democrats will say this is another reason why people should not vote for Trump."

Trump fights taxes

It may not have much impact, however, with Trump supporters or people who are right of center, Lee said.

Trump, the presumptive Republican presidential nominee, has repeatedly refused to release his federal income tax returns and has said, "I fight like hell to pay as little as possible" in taxes. He went at least two years without paying taxes in the late 1970s, according to a story in The Washington Post that quoted filings Trump made with New Jersey casino regulators.

Officials for the RNC did not return calls or emails seeking comment for this story Wednesday.

Bianchini said Hendricks was "unavailable for comment on this article" because she's on a family vacation.

During a brief interview at a Special Olympics event at the Waukesha County Courthouse, Walker on Thursday morning repeatedly declined to comment about Hendricks' taxes. "That's more of an issue on the federal level" because of state income taxes are based on federal tax returns, Walker said.

The governor said his goal is to lower taxes for the middle class. Asked what message a billionaire not paying state income taxes sends to the middle class, Walker said. "It's not because of things that we've done. It started in 2010 before I was governor."

When a reporter commented that Walker would not touch this one with a 10-foot pole, the governor replied "you got it."

Though Hendricks had a string of zeros on her Wisconsin income tax returns, records show ABC Supply paid more than $2.2 million in Wisconsin income taxes from 2011 through 2014. The company also paid state income taxes in other states where it does business, Bianchini said.

In addition, Bianchini said that from 2011 to 2014, ABC Supply paid "hundreds of millions of dollars" in various taxes, including sales taxes, federal taxes and state income taxes throughout the country.

Hendricks personally paid more than $100 million in various state and federal taxes last year, Bianchini said, noting the $7.6 million to Wisconsin is included in the tabulation.

Accountants said it is not unusual for a wealthy person to end the year with zero tax liability and then have a tax bill the following year.

"Business could ebb and flow so quickly," said Christa Baldridge, a shareholder in the Milwaukee office of Schenck SC, a Wisconsin-based accounting firm. "Just because you're worth $5 billion doesn't mean you made $5 billion."

Still, "it is unusual to go zero, zero, zero and then owe $7.6 million," said Joel Joyce, a partner at Reilly, Penner & Benton LLP, the oldest CPA firm in Wisconsin.

A number of reasons

There are several reasons a wealthy individual could have no tax liability, including investment losses, various deductions or credits or tax losses that carry forward — that is, the ability to use losses from a previous year against income earned in a later year, Joyce and Baldridge said.

The state Department of Revenue does not release details about an individual's tax return. It only releases the net tax paid by an individual or company, making it impossible to determine what deductions or credits a person used when figuring out their taxes.

Bianchini declined to say why Hendricks had owed no taxes for three straight years but paid $7.6 million last year.

"Diane's tax return — like anybody else's — is a personal document," Bianchini said. "We would prefer to keep it that way."

Follow Cary Spivak on Twitter: @cspivak