IRS holding "thousands" of requests by White House for tax documents Update: Congress already knew?

Are you ready to finally hear some good news about the IRS? Me too! Sadly, you’ll have to wait a bit longer because this looks like yet another example of something particularly shady at the agency. A watchdog group claims that after two years worth of court actions and battles with the government, the Internal Revenue Service has admitted that it has thousands of documents pertaining to requests made by the White House for the tax documents of individuals and businesses. But (wait for it…) they are refusing to turn them over.

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The revelation by the Treasury Inspector General for Tax Administration (TIGTA) came as part of a lawsuit filed by non-profit group Cause of Action, which began investigating whether the IRS was improperly sharing taxpayer information with the White House in 2012.

Cause of Action originally filed a Freedom of Information Act request asking the IRS to turn over any documents, if they existed, related to correspondence between the IRS and the White House about requests for tax returns for individuals or businesses.

When the IRS said it was unable to do so because of constraints in the Internal Revenue Code, the group filed the lawsuit. A judge ruled that the IRS must turn over any relevant documents to Cause of Action by Dec. 1 to comply with the FOIA request.

On Tuesday, an attorney with TIGTA wrote a letter to Cause of Action, and acknowledged that the watchdog had located “2,509 pages of documents potentially responsive to your request.” Of those, TIGTA confirmed that 2,043 were in fact responsive to the request.

Just admitting that the documents exist doesn’t mean that we’re going to get them. The IRS maintains that the documents are covered under 26 U.S.C. § 6103 and can not be handed over without an express statutory exception. In response to the request, the IRS stated that no such statutory exception exists, so basically… go pack sand.

But that leads us to a second question. If the tax returns of individuals and businesses are so private that they can’t be viewed without an act of congress, how is it that the White House was gobbling up thousands of them for reasons unknown? To find that out, we need to look a little more closely at 26 U.S.C § 6103. After explaining how important it is to keep tax returns private and the terrible penalties to be incurred for their unauthorized release, way down in section (f) we find a list of exceptions. Your tax returns can be revealed to certain committees of Congress, such as Ways and Means, Committee on Finance, and Joint Committee on Taxation. Kind of makes sense, right? But a whole separate section is included which for some reason allows the White House to request your tax returns as well.

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(g) Disclosure to President and certain other persons

(1) In general

Upon written request by the President, signed by him personally, the Secretary shall furnish to the President, or to such employee or employees of the White House Office as the President may designate by name in such request, a return or return information with respect to any taxpayer named in such request. Any such request shall state—

(A) the name and address of the taxpayer whose return or return information is to be disclosed,
(B) the kind of return or return information which is to be disclosed,
(C) the taxable period or periods covered by such return or return information, and
(D) the specific reason why the inspection or disclosure is requested.

Well, that certainly seems convenient, eh? The President himself – or his specifically designated representative – can ask for tax returns, provided he includes a specific reason why he wants them. Of course, there is no mention of what would qualify as a valid reason… he just has to provide one.

So why was Barack Obama requesting that many tax returns in 2012? And how many others has he requested in the years prior to or since then? Absent an act of Congress, we may not find out. But by the wording of the law, this can’t be tossed off onto the shoulders of some scapegoat. These requests came directly from the Oval Office or a specific person designated by the President. This could get very interesting very quickly.

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UPDATE: Another interesting note on the law caught by one of our eagle eye commenters. If everyone was following the rules, at least some members of Congress should already know about this.

(5) Reporting requirements
Within 30 days after the close of each calendar quarter, the President and the head of any agency requesting returns and return information under this subsection shall each file a report with the Joint Committee on Taxation setting forth the taxpayers with respect to whom such requests were made during such quarter under this subsection, the returns or return information involved, and the reasons for such requests. The President shall not be required to report on any request for returns and return information pertaining to an individual who was an officer or employee of the executive branch of the Federal Government at the time such request was made. Reports filed pursuant to this paragraph shall not be disclosed unless the Joint Committee on Taxation determines that disclosure thereof (including identifying details) would be in the national interest. Such reports shall be maintained by the Joint Committee on Taxation for a period not exceeding 2 years unless, within such period, the Joint Committee on Taxation determines that a disclosure to the Congress is necessary.

Here are the current members of the committee.
HOUSE:
Dave Camp (R-MI 4) Vice Chairman
Sam Johnson (R-TX 3)
Kevin Brady (R-TX 8)
Sander M. Levin (D-MI 9)
Charles B. Rangel (D-NY 13)

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SENATE
Ron Wyden (D OR) Chairman
John D. Rockefeller IV (D-WV)
Debbie Stabenow (D-MI)
Orrin G. Hatch (R-UT)
Chuck Grassley (R-IA)

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Beege Welborn 5:00 PM | December 24, 2024
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