A draft memo written by an IRS lawyer last fall found that the agency has to provide tax returns sought by Congress's tax committees unless executive privilege is invoked, The Washington Post reported Tuesday.
The document obtained by the Post, which doesn't directly mention President TrumpDonald TrumpTexas announces election audit in four counties after Trump demand Schumer sets Monday showdown on debt ceiling-government funding bill Pennsylvania AG sues to block GOP subpoenas in election probe MORE, stated that the tax code provision directing the Treasury secretary to provide tax returns requested by the chairmen of Congress's tax committees is "mandatory."
The memo also said that the only basis for the IRS to refuse to comply with a subpoena for tax returns "would be the invocation of the doctrine of executive privilege."
News of the memo comes as Democrats are preparing to pursue a court case to obtain Trump's tax returns. Treasury Secretary Steven MnuchinSteven MnuchinThe Hill's Morning Report - Presented by Alibaba - Biden jumps into frenzied Dem spending talks Former Treasury secretaries tried to resolve debt limit impasse in talks with McConnell, Yellen: report Menendez, Rubio ask Yellen to probe meatpacker JBS MORE last week rejected a subpoena for the documents and earlier rejected a request made in letters from House Ways and Means Committee Chairman Richard NealRichard Edmund NealOvernight Energy & Environment — Presented by the League of Conservation Voters — EPA finalizing rule cutting HFCs Panic begins to creep into Democratic talks on Biden agenda Democrats surprised, caught off guard by 'framework' deal MORE (D-Mass.) in April that cited the tax code provision.
Mnuchin has said the Treasury Department determined after consulting with the Justice Department that Neal's request lacks a legitimate legislative purpose. Trump has not invoked executive privilege in the tax return fight, officials said.
The draft memo is not in line with Mnuchin's reasoning for denying Democrats' request, and it signals there may be disagreement within the executive branch on the tax return issue, the Post reported.
The document states that the statute doesn't require the chairs of Congress's tax committees to provide a reason for a request for tax returns. The document states that "on its face, the statute does not allow the Secretary to exercise discretion to disclosing the information provided the statutory conditions are met."
The IRS told the Post that the document was authored by a lawyer in the chief counsel's office. The document isn't signed, and the newspaper said it has not learned who wrote and reviewed it.
The IRS said in a statement provided to The Hill that "the memo in question is a draft background paper that was never finalized" and "is not the official position of the IRS."
"The document was prepared last fall. The IRS Commissioner and the Chief Counsel were unaware of the paper until this week’s media inquiry. The document was not sent to Treasury," the agency added.
IRS Commissioner Charles Rettig and IRS Chief Counsel Michael Desmond are the only two people at the IRS who hold positions requiring Senate confirmation, and Desmond wasn't confirmed until this year.
A Treasury spokesperson said in a statement provided to The Hill that "neither the Secretary nor senior Treasury leadership has seen any such memo."
"Regardless, the analysis described to us does not appear to address the Constitutional impediments preventing Treasury from disclosing the requested tax information," the spokesperson added. "The Justice Department’s Office of Legal Counsel has reviewed those Constitutional issues and advised the Treasury that it may not produce the requested private tax return information."