Sun. Aug 25th, 2019
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IRS Could Face Democrats Subpoena Over Donald Trump Tax Returns After Deadline Expired

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.

Treasury Secretary Steven Mnuchin issued a pointed letter stating that he administration would not make a congressional deadline, saying he was seeking guidance from the Justice Department

He called Neal’s request the ‘culmination of a long-running, well-documented effort to expose the President’s tax returns for the sake of exposure.’ He blasted the House Ways and Means Committee’s focus ‘on a single taxpayer’ – the president.

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 had set a final 5 pm deadline for the IRS and Treasury to provide six years of Trump’s individual and business tax records.

In a letter to Neal, Treasury Secretary Steven Mnuchin said he expected to have an answer to the committee’s demand by May 6 after consulting with the Justice Department.

Mnuchin cited the ‘serious nature’ of the request in his denial, and said the request is ‘categorically different’ from previous requests for return information.

However, Mnuchin stated that his letter did not constitute a denial, and that he would provide an answer by the may deadline he established.

President Trump said earlier this month he would ‘love’ to release his tax returns – but won’t do so because he was under an audit, returning to an argument he has made throughout his presidency.

The jostling follows the release of the Mueller report, and a Democratic vow to keep up oversight and investigations of the Trump administration, even as Democratic leaders try to put the brakes on a drive to jump ahead on impeachment.

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 authorised lawmaker.

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

Trump broke with a decades-old precedent by refusing to release his returns as a presidential candidate in 2016 and continues to do so as president, saying his tax returns are under IRS audit. The IRS, which is overseen by the Treasury Department, has said that Trump could release his returns even while under audit.

Neal formally requested Trump’s returns on April 3, saying his committee was exercising its jurisdiction over IRS audits and enforcement of the tax law regarding the president. Neal set an initial April 10 deadline that the Trump administration missed.

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 authorised 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.

Lawyers for President Donald Trump warned the U.S. Treasury on Monday that Democratic lawmakers are pursuing ‘unchecked congressional power’ by requesting Trump’s tax returns from the Internal Revenue Service.

And a pair of Trump lawyers also warned the firm of Trump’s longtime accountant not to comply with the House Oversight Committee’s demand for documents.

The committee was asking for tax return information for Trump, as well as for a variety of LLCs and Trusts that formed a basis for his business enterprises. The firm indicated it would comply but sought a ‘friendly’ subpoena from the Committee – then got a stern warning from Trump’s representatives.

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