Trump faces legal hurdles in keeping tax returns private

Former President TrumpDonald TrumpJan. 6 panel plans to subpoena Trump lawyer who advised on how to overturn election Texans chairman apologizes for 'China virus' remark Biden invokes Trump in bid to boost McAuliffe ahead of Election Day MORE is facing significant legal hurdles in his ongoing effort to keep his tax returns away from Congress now that he’s a private citizen and the Justice Department is no longer fighting the oversight efforts. 

His lawyers are trying to block the Biden administration from handing the documents to the House Ways and Means Committee, arguing that lawmakers have no legitimate purpose for seeking them. 

A federal judge on Monday set a hearing in the case for November, further prolonging the congressional investigations into the former president’s still-undisclosed finances as the Trump Organization and one of its top executives face criminal charges in New York.

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The committee first requested Trump’s tax returns in 2019, citing a federal law that requires the IRS to hand over private tax records to certain congressional panels. But the Justice Department under the Trump administration advised the Treasury Department to refuse to comply, prompting House leaders to sue to enforce its demand in court.

In July, the Biden administration announced a reversal in its legal position, saying the Treasury Department should hand over the tax returns after the committee renewed its request in June.

“Applying the proper degree of deference due the Committee, we believe that there is ample basis to conclude that its June 2021 Request for former President Trump’s tax information would further the Committee’s principal stated objective of assessing the IRS’s presidential audit program—a plainly legitimate area for congressional inquiry and possible legislation,” the Justice Department’s Office of Legal Counsel (OLC) said in a memo. “The Chairman’s additional stated objectives for reviewing that tax information are also legitimate, and the Committee has authority to seek the records for those reasons as well.”

But the administration’s reversal did not put an end to the case. Trump quickly sued to block the disclosure, with his lawyers pointing to Democrats’ political attacks as evidence that the committee’s motives for obtaining his returns have little to do with legislation, but the effort is rather intended “to expose the private tax information of one individual — President Trump — for political gain.” 

“The requests are tailored to, and in practical operation will affect, only President Trump,” the former president’s lawyers said in a court filing last week. “The requests single out President Trump because he is a Republican and a political opponent. They were made to retaliate against President Trump because of his policy positions, his political beliefs, and his protected speech, including the positions he took during the 2016 and 2020 campaigns.”

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But legal experts say that Trump faces an uphill battle in keeping his returns out of the hands of congressional Democrats now that he is a private citizen and government lawyers have sided against him.

“Not having that ally is going to make it harder for Trump,” said Jonathan David Shaub, an assistant law professor at the University of Kentucky and a former OLC attorney.

Shaub added that while Trump’s lawyers are seeking to undermine the committee’s rationale for seeking the tax returns, judges typically don’t second-guess lawmakers’ intent.

“Courts are traditionally very deferential to what the committee says it’s doing,” he said. “And they accept that and then they’ll test whether that’s a facially valid request or not, given the committee’s jurisdiction, and any kind of separation-of-powers principles that Trump’s attorneys raise.”

Richard Pomp, a tax law professor at the University of Connecticut, says that ascribing the committee’s request to a political attack on the former president may not prove to be successful for Trump’s legal team if the House’s lawyers can show that they have a legislative purpose in seeking the documents.

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“That doesn’t really mean that there’s not merit here,” Pomp said. “Just because you’ve got a bunch of Democrats that would love nothing better than to publicize everything that is turned over to Ways and Means really doesn’t affect the legal issue.”

In June, Rep. Richard NealRichard Edmund NealDemocrats haggle as deal comes into focus Manchin objects to IRS bank-reporting proposal Yellen should utilize the resources available before pushing new regulations MORE (D-Mass.), the chairman of the Ways and Means Committee, sent a letter to the Treasury Department saying that his panel is continuing to seek the returns in order to inform their legislative efforts, “including, but not limited to, the extent to which the IRS audits and enforces the Federal tax laws against a President.”

“There have been claims that the true and sole purpose of the Committee’s inquiry here is to expose former President Trump’s tax returns. These claims are wrong,” Neal wrote. “We have a duty to our constituents to eliminate unfairness where we see it, and we have an obligation to do so by legislating in an informed and responsible manner.”

The Manhattan district attorney’s office obtained Trump’s tax returns earlier this year after a protracted court battle over a grand jury subpoena. Last month, the office charged the Trump Organization and its Chief Financial Officer Allan Weisselberg with tax fraud.

Last year, the Supreme Court ruled that Trump, who was still in office at the time, had no special immunity to such grand jury subpoenas, rejecting his lawyers’ arguments of blanket presidential protections.

But in a similar set of cases involving congressional subpoenas for Trump’s personal financial records, the Supreme Court was not as definitive, sending the cases back down to the lower courts and advising judges to take a more balanced approach when resolving such disputes between the legislative branch and the president.

It’s unclear how much of a role Trump’s status as a former president will play in the Ways and Means case or whether that would offer him any sort of legal protections against congressional inquiries.

Pomp said the case is more likely to focus on the committee’s stated goals for seeking the documents.

“There are untested issues here. A judge is going to have to determine whether there’s a sufficient legislative purpose, while paying proper respect to the legislative branch of the government and their powers,” Pomp said. “I think it will be difficult on a judge to say this is outside the bounds of the law.”