If Democrats now in charge of the House Ways and Means Committee ever get their hands on President Donald Trump’s tax returns, they could thank their Republican predecessors for providing cover to make the documents public.
In 2014, the GOP-controlled panel voted to expose taxpayer information surrounding the IRS’s admission that it improperly delayed some Tea Party groups’ applications for tax-exempt status. Committee Chairman Dave Camp had said the release was needed to inform the Justice Department about potential crimes and notify the public about IRS wrongdoing.
Legal scholars have said much of the exposed information didn’t relate to the purported malfeasance. Lois Lerner, the IRS director of exempt organizations, was suspended and later retired, but wasn’t charged with any crimes.
The episode, though under different circumstances, could be used by Democrats as a precedent to make some of Trump’s tax information public, if Democratic Ways and Means Chairman Richard Neal ever succeeds in obtaining the returns, said Christopher Rizek, an attorney with Caplin & Drysdale in Washington.
The Lerner episode should be a concern to Republicans “if they don’t want the returns to be made public,” Rizek said. He said that if Trump tries to fight a release of his tax returns, his attorneys will likely argue that Camp’s release of the information in 2014 was itself illegal.
The Trump administration, the president’s personal attorneys and Neal’s committee are locked in a battle over Neal’s request for six years of Trump’s personal and business returns. Democrats are investigating a number of matters related to Trump’s businesses before the 2016 election and whether he has paid all the taxes he owes.
Auditing the President
Mindful that some scholars believe federal law requires a legislative purpose for seeking a taxpayer’s returns, Neal told the IRS and the Treasury Department that he wants to ensure the IRS is following its policy of annually auditing the president. The Treasury Department and Trump’s lawyer, William Consovoy, say that reason is merely a pretext for a political attack.
In a letter to IRS Commissioner Charles Rettig, Neal cited the tax code’s requirement that the Treasury secretary “shall furnish” the returns of any taxpayer upon request of the leaders of the Ways and Means or Senate Finance committees, as well as the Joint Committee on Taxation.
Treasury Secretary Steven Mnuchin has so far refused and is seeking a Justice Department opinion. Republican lawmakers say Neal’s move is unprecedented.
“Americans should be able to trust that the federal government or some unelected bureaucrat in Washington is not going to publicly release their tax returns without the taxpayer’s consent,” Ways and Means committee member Mike Kelly, a Pennsylvania Republican, said at an Oversight subcommittee hearing in February before Neal’s official request.
But in 2014, Camp used the same power to investigate claims that the IRS was selectively targeting conservative advocacy groups. He and other Republicans believed the IRS deliberately slow-walked the approval of tax-exempt status for conservative organizations such as the Tea Party. The committee gathered documents including the private taxpayer information of liberal and conservative groups to show the IRS paid greater scrutiny to conservatives.
‘We Have the Authority’
After going through the documents, Camp said he found evidence that Lerner broke the law. At a closed meeting, the committee voted to send a letter referring the matter to the Justice Department while making the letter and the accompanying evidence public, which Camp said was under its power in section 6013 of the tax code. The documents included taxpayer information about the groups the IRS was said to target and also about unrelated taxpayers.
“Look, 6103 provides for this," Camp said, according to a transcript of the closed session that was later made public. "The statute provides that when the committee, in its oversight role, finds egregious information, we have the authority to release confidential taxpayer information.”
Given the nature of what his committee had discovered, “It is important that we try to find a way to move this into the public sphere,” Camp said.
Over Democrats’ objections, the committee voted to make public the letter and evidence, which included private information of 51 taxpayers.
The Justice Department notified Congress in 2015 that it wouldn’t charge Lerner or others involved in the matter.
“That whole episode turns out in retrospect to be pretty important,” said University of Virginia law professor George Yin, who has studied the issue. Yin said he believes Camp didn’t provide a legitimate legislative purpose to make the taxpayer information public and that the committee members who voted in favor of releasing it likely broke the law.
To comply with the law, Neal would need to have such a purpose before making Trump’s information public, Yin said.
Though Yin said Neal should avoid Camp’s mistakes, he said the Lerner episode shows that some Republicans’ concerns that Neal’s request “opens a can of worms” are unfounded, because in Yin’s view, the authority was already misused.
A spokeswoman for PricewaterhouseCoopers, where Camp now works, said in an email that Camp wasn’t available to comment.
Neal has said he doesn’t plan to make Trump’s tax information public. However, many Democrats believe that once the committee begins to examine the returns, they’ll find evidence of potential lawbreaking that warrants disclosure.
