On Tuesday, the House Ways and Means Committee voted to make public six years of the tax returns of former President Donald Trump. The committee also issued two reports, one from its members and another from the Joint Committee on Taxation, that showed that Trump paid no income taxes in 2020, after paying 1.1 million dollars the first three years of his term. The committee revealed that the Internal Revenue Service had failed to audit Trump during his first two years in office—as required by law—and started auditing him only in 2019, on the same day that the Ways and Means Committee’s chairman, Richard Neal, a Massachusetts Democrat, sent a letter to the agency. The audits were not completed. The committee’s decision to make Trump’s returns public represents the culmination of a legal battle that Trump and the committee have been engaged in since Democrats retook the House that year; the Supreme Court recently denied Trump’s request that the information be kept from the committee. It could take some time for the returns to be released by the committee, as staffers go through the documents to redact any sensitive information. Presidents have traditionally elected to make their taxes public, as a demonstration of transparency. Trump is now a private citizen, however, and Republicans attacked the committee’s decision as a threat to taxpayer privacy. John Koskinen, who served as the I.R.S. commissioner under President Obama and during the first year of the Trump Administration, told the Times that the release of Trump’s returns set a “dangerous precedent.”
I spoke by phone with Neal on Wednesday morning. During our conversation, which has been edited for length and clarity, we discussed the legal battle to get the returns, why Trump did not face an audit, and the rationale for releasing his taxes to the public.
In 2019, when Democrats got the majority and you set out to look into Trump’s taxes, what were you setting out to find? What was the idea there?
Well, I don’t think we had drawn any conclusions. I think that I didn’t want to get out in front of a story by making a declaration that then turned out to be inaccurate. I think I was really moved by the idea that nine out of the last ten American Presidents had submitted their tax forms for public review.
I thought that I looked prescient in one area, because, as we were preparing a very careful case, I said that it would be a long and gruelling court case that would end up at the Supreme Court, and that’s precisely what happened.
When did you get the returns?
I’m still hemmed in a bit by the speech-and-debate clause of the Constitution, and have been forewarned by attorneys as to not specifically talking about the forms, rather than the two reports that were issued.
But, to make the reports, you must have had some access to the returns, correct?
Well, I designated agents, and the agents are tax lawyers and accountants, and they began a review of procedure. They actually visited the I.R.S. headquarters, and I think they visited two sites—maybe three, I’m not positive. They indicated that the audits that were required by law had not taken place. [A spokesperson for the committee said the agents first accessed the returns on November 23rd, the day after the Supreme Court’s decision not to block their release.]
What is the law?
It dates to 1924, and, by way of background, it was a response to the Teapot Dome scandal, which related to oil leases in Wyoming. It was a question about how it had been handled by the Secretary of the Treasury at the time. In any event, after some procrastination, President Calvin Coolidge signed the legislation into law. It was not codified, however, until 1977, in the aftermath of Watergate. After 1977, the law said that the I.R.S. had to do it, annually.
Do you have some sense of whether this audit was done on Presidents after 1977 but before Trump?
I don’t know that, but I think that some of that is mitigated by the fact that their documents were all published, and there would’ve been what I think you could probably describe as a lot of monitoring as to how deductions took place, and all of those tax forms were released. I think that accountants probably looked at them. I think reporters looked at them. I think in that sense public scrutiny addressed the issue. [The Times reported on Wednesday night that the I.R.S. routinely audited the tax returns of both Barack Obama, while he was President, and Joe Biden, since he took office.]
And you don’t know why it was not done with Trump, correct? You just found that the audits were not done until 2019, when you sent a letter and then some sort of audit was begun. But you don’t know if there was political interference?
No. The other problem is that the I.R.S. indicated, and Commissioner [Charles] Rettig indicated at one point in public testimony as well, they did not have the specialists that were necessary to review the tax documents. I think that the term in public that Commissioner Rettig has used in the past was that they were simply outgunned. The real issue is that the mandatory review was dormant.
Sorry, just to clarify, the I.R.S. was saying they didn’t have the specialists to review the now former President’s documents?
Yeah.
That just seems like a strange admission from the I.R.S.
You could say that, yeah.
I just want to paraphrase what you said, but please tell me if this is wrong, because most people reading this, myself included, are not experts in tax stuff. You’re saying, essentially, that you don’t know if this rule was just never followed under previous Presidents, but it was less important with previous Presidents because they all released their taxes. Is that accurate?
That’s exactly right.
Can you talk more about how the two reports were put together?
I tasked the job to the Oversight Subcommittee, which is led by Karen McAfee. She is a tax specialist. She was in the private sector, and she is the chief of staff at the Oversight Subcommittee. And those who work for her, who are all tax lawyers.
[The other report is from] the Joint Committee on Taxation. The public wouldn’t really understand a lot of how J.C.T. works. The J.C.T. is an independent agency. It is made up overwhelmingly of tax lawyers, C.P.A.s, and economists, and it has a stellar reputation because they don’t issue reports based on being a Democrat or a Republican, a liberal or a conservative. They just parse the evidence.
In the case of what the Ways and Means staffers did, they visited the sites, and they discovered that, in fact, the actual mandatory audit had not occurred. By the way, an interesting footnote, here we are in 2022. None of the audits are complete.
You don’t know why that is?
I don’t know why that is, no.
What is your plan? I know you’re only in the majority for less than a couple weeks here, but what is the idea here—to use the returns to do investigative work?
Well, the most important thing we’re going to do is follow the law. As those documents become public, there’ll be ample opportunity for review.
Which law is this?
How it’s done. How it’s done.
Wait, how what’s done?
How the process plays out. I mean, I think that adherence to the law has been very important. I have scrupulously followed it for three and a half, almost four years, and we prepared a very sophisticated case that prevailed four times in three federal courts. Even now, with this speech-and-debate clause, I’m a little bit hesitant about saying anything until we see where this heads in the next few days. We did agree—everybody is in broad agreement—on the fact that you have to redact Social Security numbers, addresses, children’s identity, PIN numbers, bank accounts, things like that.
Oh, that’s what you mean by following the law. O.K.
That’s right.
Aside from following the law, what are you hoping to gain now that you have access to these returns?
I think the opportunity is there now for public inspection.
That gets to the question of “Why release the returns?” Since former President Trump is now a private citizen, what is the point of releasing them to the public? Can you explain why that’s necessary?
Well, I think the real answer is that we now know that the mandatory audits never took place.
Okay, so you’re saying that the people need to be able to look over them because the government did not?
That’s right.
Wouldn’t one answer to that be, essentially, that you, as a member of the House, should pass legislation auditing former Presidents, rather than releasing a private citizen’s—
Well, yeah. The legislation that we are likely to try to act on today or tomorrow is my legislation that would require the I.R.S. to, within ninety days of a President taking office, in concurrence with the Secretary of the Treasury, begin the auditing process and report back regularly the results. That legislation, I think, is likely to be fast-tracked, and I’m assuming it would get broad public support. That’s a bill that I intend to submit. It was part of my strategy, and I thought that we should say that you have ninety days of filing and that the rules would prevail. This will no longer be any sort of a question, because the I.R.S. will be required not only to do the review but then to publish the result.
O.K., but does that raise the question of “Why release them to the public?”
Well, I don’t think so. I mean, I think, again, the issue was complicated, and you’ve heard me cite Magna Carta. And I think that the ability of Congress to do its job, the ability of Congress to do technically what is oversight and review, and I pointed out at a series of press availabilities last evening, and I can say this to you sincerely—this was never about being malicious. It was never about being punitive. It was about what I thought was the obligation of the Ways and Means Committee, which is the oldest committee in Congress, to do its job. Its job included reviewing those documents.