Is It Worth It For Congress To Obtain Trump’s Tax Returns By Force?

One of the many controversies surrounding President Trump is his refusal to release his tax returns. While his refusal has broken a tradition that every president has followed for many years, there is no law requiring him to disclose them. This made his opponents wonder if he has something to hide. With the Democrats set to control the House Ways and Means committee in January, they have a shot of releasing them to the public. Or do they? And is it worth it?

A person’s tax return is confidential. The Internal Revenue Service takes this very seriously as no one has leaked President Trump’s tax return to this day. However, Section 6103 of the Internal Revenue Code specifies certain instances where someone’s tax return must be disclosed.

The section states that the IRS must provide anyone’s tax return to the chairman (and only to the chairman) of the House Ways And Means Committee upon request. The entire committee can review the tax return in a closed executive session away from the public.

Section 6103 does not state that a House Ways And Means Committee member is authorized to release a tax return to the public. But it allows the committee to forward the returns to the full House or the Senate. Professor Andy Grewal stated that by voting to release the returns to the full House, the committee can effectively release the tax return to the public. Also, Professor George Yin provided instances of Congress releasing taxpayer information to the public. Once by the Joint Committee of Taxation during the Nixon Administration where President Nixon was found to be owing about $500,000 in taxes due to a questionable charitable deduction. And the other in 2014 where the Republican-controlled House Ways And Means Committee voted along party lines to release the names of numerous taxpayers in connection with their investigation of the IRS’s Exempt Organization Unit.

Assuming Section 6103 allows the House Ways And Means Committee to release President Trump’s tax returns to the public, does he have a constitutional defense? The Supreme Court has held that Congress cannot divulge an individual’s private information just because they feel like it or to harass someone. Congress must have a legitimate legislative purpose for disclosing tax returns.

Are there legitimate legislative purposes for releasing President Trump’s tax returns? That depends on who you ask. People would want to know whether the President received substantial income from other countries, particularly Russia. Others would want to know whether the President still has substantial income from his vast real estate holdings, which some have speculated could create a conflict of interest.

However, there are those who would want to disclose President Trump’s tax returns just to humiliate him. His tax returns can be used to show that he is not as rich as he constantly claims to be. Or they may question his charitable contributions. If they are too high, they may question whether the donations are legitimate. If they are too low, that can be used to prove that he is not that generous, although a taxpayer is not required to disclose every donation they make on the return. Finally, the tax return can used to find out how much alimony he is paying to his ex-wives.

Finally, if Congress is able to get past the legal hurdles mentioned above, is it really worth it?

What if the tax returns show nothing special? It may be possible that President Trump may be intentionally holding back his tax returns to have his opponents and the mainstream media go on a wild goose chase and waste their time. Those on the extreme left will find a way to make a mountain out of a molehill on every line item on his return. But if Trump’s supporters and moderates don’t think his tax returns are suspicious, the President might be able to make a convincing argument that he is the victim of bullying by the Democratic House.

Second, there is the possibility that no one will care. Trump’s approval/disapproval rating has remained constant despite the Russia investigation, Stormy Daniels, the travel ban, the wall, and other controversies.

Also, President Trump can play the tax return disclosure game too. Section 6103 allows the President to obtain anyone’s tax records, including those of legislators, with no limitations. So this can result in a scorched earth strategy where everyone’s tax returns are exposed. This can not only open the door for additional scandals, but it will have taxpayers questioning the integrity of the IRS and the tax system. After all, if tax returns can be publicly disclosed for political purposes, then are they really confidential?

In my opinion, if President Trump’s tax returns are as sketchy as the Democrats claim, they would have been leaked a long time ago despite the strict confidentiality laws. It is believed that Robert Mueller has Trump’s tax returns. Also, Section 6103 allows state tax agencies to obtain a copy of someone’s tax return for the purpose of administering tax laws. Since President Trump has real estate and golf courses in some very unfriendly blue states, someone at a state tax agency might be tempted to leak them for “the good of the country.”

President Trump recently said that he doesn’t care if his tax returns are released. Next year, we’ll see if that’s the case. If the President fights Congress’s attempts to get his tax returns, the courts will determine whether Section 6103 allows committee members to disclose the tax returns to the public and whether they have legitimate legislative reasons for doing so.

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Steven Chung is a tax attorney in Los Angeles, California. He helps people with basic tax planning and resolve tax disputes. He is also sympathetic to people with large student loans. He can be reached via email at [email protected]. Or you can connect with him on Twitter (@stevenchung) and connect with him on LinkedIn.