The U.S. Supreme Court has ruled that President Donald Trump is not automatically immune from investigations on his income tax returns but stopped short of requiring the release of his tax returns. The Court directed the lower district courts to determine whether Trump’s accountants and financial institutions must release his returns to prosecutors.
The Court’s decision stems from two separate cases related to Trump’s returns: Democrats in the U.S. House of Representatives and the Manhattan district attorney had subpoenaed the accounting firm that traditionally handles his business finances and taxes, Mazars USA, to turn his tax records over to them. Subpoenas were also served on other banks with which the president conducts business, Trump’s personal lawyers filed suit in both cases to prevent the release of that information.
In the New York case, the court ruled Trump’s financial and tax information may have to be provided to a grand jury, whose proceedings are secret. But such action will be litigated in lower courts before it happens, and that the president cannot refuse to comply with subpoenas simply because he is president. In the case involving the House of Representatives, the Court ruled that subpoenas may be enforceable but lower courts below did not properly account for possible concerns regarding separation of powers. That case is also directed back to lower courts. In both cases, the justices voted 7-2.
The House Ways and Means Committee has also asked, and filed suit against, the IRS to turn over Trump’s taxes, citing federal law they said requires the agency to do so. U.S. Code, Title 26, § 6103, states, in part:
“Upon written request from the chairman of the Committee on Ways and Means of the House of Representatives, the chairman of the Committee on Finance of the Senate, or the chairman of the Joint Committee on Taxation, the Secretary [of the Treasury] shall furnish such committee with any return or return information specified in such request …”
Treasury Secretary Steven Mnuchin denied the request, stating that the IRS is “not authorized to disclose the requested returns and return information” because the House “lacks a legitimate legislative purpose” for the request.
Trump’s lawyers had argued that lawmakers were trying to engage in law enforcement, an area his lawyers say is under the executive branch of the government, which is headed by Trump, and that the returns are his private interests. Trump’s lawyers have also argued that a sitting president should be immune from any state or federal prosecutions or investigations while in office.
House Democrats have said their purposes for requesting the returns and financial information are for legislative purposes, including creating new federal ethics and anti money laundering laws, and efforts to prevent the influence of foreign nations on American elections.
Manhattan’s District Attorney Cyrus Vance Jr. has argued that president Trump is trying is not above the law, even though his lawyers are stating that he is immune. Vance’s office has been investigating charges that the president’s family-run business, the Trump Organization, claimed state and federal business deductions by falsifying records of hush payments paid to Stormy Daniels and Karen McDougal, when he allegedly had extra-marital relationships. State and federal tax agencies generally have the authority to ask businesses and taxpayers for details and records supporting their expense claims.