Fact and Fiction on Trump’s Tax Returns – Whatever Source Derived – Medium

Fact and Fiction on Trump’s Tax Returns – Whatever Source Derived – Medium:
by Daniel Hemel(U.Chicago Law School)
 President Trump’s personal attorney, William Consovoy, sent a letter to the Treasury Department’s general counsel on Friday arguing that House Ways and Means Chairman Richard Neal “cannot legally request — and the IRS cannot legally divulge” — the president’s tax returns. The letter gets a couple of things right and other things very wrong.

First, Consovoy is correct that 26 U.S.C. § 6103(f), the once-obscure 1924 statute that everyone is now talking about, does not resolve the present controversy. Section 6103(f) says that upon written request from the House Ways and Means chair or his Senate Finance Committee counterpart, the Treasury secretary “shall furnish such committee with any return or return information specified in such request.” But that is not the end of the story.

As Andy Grewal and others have (rightly) noted, § 6103(f) cannot extend any further than Congress’s legislative power. While “[t]he power to conduct investigations is inherent in the legislative process,” it is “not unlimited.” See Watkins v. United States, 354 U.S. 178, 187 (1957). For one thing, “[t]here is no general authority to expose the private affairs of individuals without justification in terms of the functions of the Congress.” Id. Thus, a § 6103(f) request — like any investigative step by a congressional committee — “must be related to, and in furtherance of, a legitimate task of Congress.” Id. Second, § 6103(f) — like every other statute — is limited by the Bill of Rights. Congress cannot, for example, compel a witness to incriminate herself. See id. at 188.

On its face, Chairman Neal’s request satisfies the “legitimate task” test. “The power of the Congress to conduct investigations … encompasses inquiries concerning the administration of existing laws as well as proposed or possibly needed statutes.” Watkins, 354 U.S. at 187. As Chairman Neal’s letterexplains, the Ways and Means Committee “is considering legislative proposals and conducting oversight related to … the extent to which the IRS audits and enforces the Federal tax laws against a President.” This is a serious concern. The president is the head of the executive branch; the IRS is part of the executive branch; and those two facts alone lead to worries that the IRS will show favoritism in its examination of its boss’s returns. Recognizing this risk, the IRS has established an internal procedure for review of the president’s (and vice president’s) tax returns, but this procedure appears to have two significant shortcomings. First, it does not appear to apply to returns filed by the president before his inauguration that are still under audit while he is in office. (As of March 2016, the IRS was still examining Trump’s returns from 2009 onwards.) Second, it does not appear to apply to returns filed by business entities and trusts controlled by the president. It’s entirely legitimate for the Ways and Means Committee to evaluate whether the Service’s examinations of Trump’s pre- and post-presidential personal and business returns have been tainted by favoritism (or, possibly, by animus) and, if so, whether there is anything that Congress should do about that legislatively.

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