IRS fails to meet congressional deadline to hand over Trump tax returns

By David Morgan

WASHINGTON (Reuters) – The U.S. Internal Revenue Service on Tuesday failed to meet a congressional deadline for turning over President Donald Trump’s tax returns to lawmakers, setting the stage for a court battle between Congress and the administration.

The outcome, which was widely expected, could prompt House Ways and Means Committee Chairman Richard Neal to subpoena Trump’s tax records as the opening salvo to a legal fight that may ultimately have to be settled by the U.S. Supreme Court.

Neal set a final 5 p.m. EDT (2100 GMT) deadline for the IRS and Treasury to provide six years of Trump’s individual and business tax records. But a Democratic committee aide said the deadline passed without the panel receiving the documents.

Earlier on Tuesday, the White House said Trump was unlikely to hand over his tax returns. “As I understand it, the president’s pretty clear: Once he’s out of audit, he’ll think about doing it, but he’s not inclined to do so at this time,” White House spokesman Hogan Gidley told Fox News in an interview.

“This is not up to the president. We did not ask him,” said a Democratic committee aide, who cited a law saying the Treasury secretary “shall furnish” taxpayer data upon request from an authorized lawmaker.

“In terms of the law, what he says is largely irrelevant,” said the aide, who was not authorized to speak publicly about the White House remarks.

Neal informed IRS Commissioner Charles Rettig in a letter earlier this month that failure to comply with the deadline would be viewed as a denial.

Treasury Secretary Steven Mnuchin has said that he intends to “follow the law” while pledging to keep the IRS from being “weaponized” for political gain.

Legal experts said House Democrats could vote to hold Mnuchin or Rettig in contempt of Congress if they ignored a subpoena, as a pretext to suing in federal court to obtain Trump’s returns.

As Ways and Means chairman, Neal is the only lawmaker in the House of Representatives authorized to request taxpayer information under federal law. Democrats say they are confident of succeeding in any legal fight over Trump’s tax returns.

“The law is on our side. The law is clearer than crystal. They have no choice: they must abide by (it),” Representative Bill Pascrell, who has been leading the Democratic push for Trump’s tax records, said in a statement to Reuters.

Democrats want Trump’s returns as part of their investigations of possible conflicts of interest posed by his continued ownership of extensive business interests, even as he serves the public as president.

Republicans have condemned the request as a political “fishing expedition” by Democrats.

Despite the law’s clarity, Democrats have long acknowledged that the effort would likely result in a legal battle that could end up with the U.S. Supreme Court.

“If the IRS does not comply with the request, it is likely that Chairman Neal will subpoena the returns,” Representative Judy Chu, a Democratic member of the Ways and Means Committee, told Reuters.

“If they do not comply with that (subpoena), a legal battle will begin to defend the right of oversight in Congress,” she said.

Trump broke with a decades-old precedent by refusing to release his tax returns as a presidential candidate in 2016 or since being elected, saying he could not do so while his taxes were being audited.

But his former personal lawyer, Michael Cohen, told a House panel in February that he does not believe Trump’s taxes are under audit. Cohen said the president feared that releasing his returns could lead to an audit and IRS tax penalties.

(Reporting by David Morgan; additional reporting by Makini Brice; editing by Susan Heavey and Bill Berkrot)

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