IG finds Treasury handled House request for Trump tax returns properly

The Treasury Department’s inspector general office found that the department “properly” processed House Democrats’ request for President Trump’s tax returns when it refused to turn over the documents to the Ways and Means Committee.

In a memo, the IG also said it found Treasury Secretary Steve Mnuchin’s supervision of the process to be consistent with its rules. 

The memo said it found Treasury’s receipt, processing and responses to the request and subpoenas from House Ways and Means Committee Chairman Richard Neal (D-Mass.) “to be consistent with Treasury’s general process for handling Congressional correspondence.”

Deputy IG Richard Delmar, who is currently performing the duties of the IG, said in a cover letter that Mnuchin relied on an opinion from the Justice Department’s office of legal counsel (OLC) in denying the request, and that the IGs office did not opine on the conclusions in the OLC opinion.

Delmar sent the report on Wednesday to Neal and Ways and Means Committee ranking member Kevin Brady (R-Texas). The report was made public on Friday by the office of Senate Finance Committee Chairman Chuck Grassley (R-Iowa.), after Grassley requested the findings.

In April 2019, Neal requested six years of Trump’s personal and business tax returns from the IRS, under a provision in the federal tax code that states that the Treasury Secretary “shall furnish” returns requested by the chairs of Congress’s tax committees.

Treasury and the IRS then rejected the request and subsequent subpoenas. In July 2019, Neal filed a lawsuit in an effort to obtain the returns, and the lawsuit has yet to be resolved.

Neal requested that the inspector general examine Treasury’s handling of his request last fall, saying that he wanted to be assured that Treasury and the IRS are “enforcing the law in a fair and impartial manner.”

The IG’s office interviewed eight Treasury officials as part of its investigation, primarily officials in the department’s office of general counsel. 

The report said that Treasury followed the department’s general process for handling congressional requests.  

One Treasury official told the IG’s office that Mnuchin made the final decision in deciding to rely on OLC’s opinion, but that the opinion was “binding” because OLC is the lawyer for the executive branch.

After Neal made his request, a personal lawyer for Trump, William Consovoy, sent a letter to Treasury, raising concerns about Neal’s effort. Treasury officials told the IG that Consovoy’s letter did not influence the department, according to the report. The report added that the reasoning behind consulting and relying on OLC appears to have originated from Treasury’s general counsel office.

The report said that the “scope of the inquiry did not examine the legal opinions in formulating responses to Chairman Neal, nor attempt to identify or interpret the basis for Treasury’s decisions to produce, or not produce, records.” 

Neal has said that he wants Trump’s tax returns because the Ways and Means Committee is conducting oversight and considering legislative proposals related to how the IRS audits presidents. But the Trump administration has argued that Neal’s request lacks a “legitimate legislative purpose,” claiming that Neal’s stated purpose is pretextual and that his real goal is to make Trump’s return’s public.

A spokeswoman for Neal said Friday that Neal “maintains that the law is on his side and he believes his request should be granted.”

Grassley and Brady, who both oppose Neal’s efforts to obtain Trump’s tax returns, cheered the IG report.

“This should put to bed any question about the Treasury Department’s handling of this matter,” Grassley said in a statement. “From the beginning, Democrats have insisted that something must be awry if they didn’t immediately get their way. But that’s not how checks and balances work and it’s not how the process of congressional oversight works.”

Brady said that because of the report, “President Trump and his Administration have been exonerated, as expected, from politically motivated allegations of mishandling Congressional inquiries.”

The top Democrat on the Senate Finance Committee, Sen. Ron Wyden (D-Ore.), said that the IG report “falls far short, taking the word of Treasury Department officials that they did nothing wrong at face value and dismissing contradictory interviews.”

Updated at 3:31 p.m.