Treasury expected to miss Dem deadline on Trump tax returns

The Trump administration is expected to miss the Wednesday deadline set by Democrats to hand over President TrumpDonald John TrumpNew Biden campaign ad jabs at Trump's reported 0 income tax payments Ocasio-Cortez: Trump contributed less in taxes 'than waitresses and undocumented immigrants' Third judge orders Postal Service to halt delivery cuts MORE’s tax returns, raising the odds that the battle will turn into a lengthy court fight. 

Treasury Secretary Steven MnuchinSteven Terner MnuchinHouseholds, businesses fall into financial holes as COVID aid dries up Centrist Democrats got their COVID bill, now they want a vote The Hill's Morning Report - Sponsored by Facebook - Republicans lawmakers rebuke Trump on election MORE testified to two congressional committees on Tuesday, telling lawmakers the White House had discussed the tax-return issue with Treasury’s legal department before Democrats asked for the documents. Mnuchin said he personally had not spoken to Trump over the tax returns.

Trump has said he cannot make the records public because of an audit, and his acting chief of staff on Sunday publicly said the administration will never hand them over to Democrats.

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Mnuchin was much more reserved in his remarks, telling reporters that it would be a “good guess” that the administration would reply to Democrats by Wednesday in some form. 

“I think it would be premature at this point to make any specific comments other than, as I’ve been consistent before in saying, it is being reviewed by the legal departments, and we look forward to responding to the letter,” he said at a House Appropriations subcommittee hearing.

Several hours later, at a House Financial Services Committee hearing, Mnuchin said he will “comply with the law” but has “not made a comment one way or another whether we would supply the tax returns.”

House Ways and Means Committee Chairman Richard NealRichard Edmund NealDemocrats blast Trump after report reveals he avoided income taxes for 10 years: 'Disgusting' Trump didn't pay income tax for 10 of 15 years before 2016 election: NYT Centrist Democrats got their COVID bill, now they want a vote MORE (D-Mass.) last week requested that the IRS provide the committee with six years of Trump’s personal and business tax returns by Wednesday.

Democrats are bracing for their request to eventually result in a court fight. If Democrats don’t receive the tax returns by their requested deadline, they are likely to take additional steps to try to obtain the documents, such as sending another letter to the IRS or issuing a subpoena.

Trump is the first president in decades not to release his tax returns. 

Democrats argue that the law is clear — the IRS should provide them with the documents and Mnuchin should not be involved in the decision. Mnuchin’s revelation that the Treasury Department and White House officials have discussed the topic is likely to raise concerns about political interference. 

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Mnuchin downplayed the communications, saying the communications between Treasury Department lawyers and the White House general counsel occurred before Democrats formally requested Trump’s returns from the IRS. He said at the Appropriations hearing that he wasn’t briefed on the full contents of the communications and called them “purely informational.”

“We would not ever ask for the White House’s permission on this nor did they give us the permission,” Mnuchin said during the Financial Services hearing.

Neal requested the tax returns under a provision of the tax code that states that the Treasury secretary “shall furnish” the documents, but he sent his letter not to Mnuchin but to IRS Commissioner Charles Rettig, since the Treasury Department has delegated tax administration matters to the IRS. 

Democrats asked Mnuchin about whether he thinks he should be involved in making the decision.

Mnuchin didn’t directly answer the question, saying that he didn’t want to comment on what Treasury’s lawyers may be reviewing. He noted that the Treasury Department has delegated responsibilities to the IRS, but also said “it is my responsibility to supervise the commissioner.”

When Rettig appeared before the House Appropriations subcommittee in a separate hearing Tuesday, Democrats also asked him about who will be responsible for deciding whether the tax returns are turned over.

Rettig said he had a “brief discussion” with Mnuchin to say he received the letter. He said there was a discussion about who will handle the response, but “there’s no conclusion on that.” He also said he’s not aware of any communications between the White House and the IRS on the tax returns issue.

Mnuchin is in a tricky spot. He is one of Trump’s closest allies in the administration, defending him at times when others haven’t. But Democrats argue the IRS has no wiggle room to avoid handing over the documents.

Mnuchin’s test comes as Trump purges his administration of top officials who’ve reportedly refused to follow the president’s orders to ramp up measures to halt border crossings and others deemed insufficiently loyal.

Mnuchin rebuffed Rep. Maxine WatersMaxine Moore WatersPowell, Mnuchin stress limits of current emergency lending programs Pelosi: House will stay in session until agreement is reached on coronavirus relief Omar invokes father's death from coronavirus in reaction to Woodward book MORE (D-Calif.), chairwoman of the Financial Services panel, when she asked if the secretary would comply with the law while deciding the fate of Trump’s returns without regard for his own job security.

“I’m not afraid of being fired at all. Having said that, I said that we will follow the law,” Mnuchin responded.

While Mnuchin kept his cards close to his chest, he did make some comments that could be perceived as supportive of Trump.

He said the voters decided to elect Trump in 2016 even though he hadn’t voluntarily released his tax returns. He also said that some Democrats should be happy Republicans haven’t sought their tax returns.

“I am sure there are many prominent Democrats who are relieved that when [Rep.] Kevin BradyKevin Patrick BradyBusinesses, states pass on Trump payroll tax deferral Trump order on drug prices faces long road to finish line On The Money: US deficit hits trillion amid pandemic | McConnell: Chance for relief deal 'doesn't look that good' | House employees won't have payroll taxes deferred MORE [R-Texas] was chairman of the [Ways and Means] committee that he didn’t request specific returns,” he said during the Appropriations hearing.

Rep. Sean DuffySean DuffyCNN's Ana Navarro to host Biden roundtable on making 'Trump a one-term president' Bottom line McCarthy blasts Pelosi's comments on Trump's weight MORE (R-Wis.) told Democrats during the Financial Services hearing that the request for Trump’s returns “would probably come around and bite you as well.”

“I don’t know if Hillary and Bill [Clinton] want theirs released and if [Barack] Obama wants his,” Duffy mused. “We can play this game out.”

Rep. Gregory MeeksGregory Weldon MeeksBottom line Democrats go big on diversity with new House recruits Chamber of Commerce, banking industry groups call on Senate to pass corporate diversity bill MORE (D-N.Y.) shot back that both Clintons, Obama and every president since Richard Nixon had released their tax returns. He also claimed that Trump “lied to the American people” for promising to release his tax returns and failing to do so.

Duffy said he wants Trump to release his tax returns, but said lawmakers should “let it go” since the president has refused to do it.