A federal appeals court has ruled that the House Ways and Means Committee is entitled to receive the tax returns of former President Donald Trump, which it first requested in 2019, CNBC reported. The U.S. Court of Appeals for the D.C. Circuit upheld a December ruling of the U.S. District Court for the District of Columbia, with the three-judge panel ruling 3-0 in favor of the House committee. The court ruled that the committee, which has sought Trump’s tax records for years as part of an inquiry into how the IRS audits presidential income tax returns, had the legal right to obtain them from the U.S. Treasury Department.  

Trump now has the option of appealing to the full complement of judges on the appeals court or to the U.S. Supreme Court. The appeals court said that its decision is on hold until seven days after the disposition of any potential petition by Trump seeking to overturn the ruling. 

As a candidate, and then as president, Trump broke with decades of precedent by refusing to publicly release his tax returns.

House Ways and Means Committee Chairman Richard Neal (D-Mass.) first requested the returns of Trump and several of his businesses from the IRS commissioner on April 3, 2019. Although Sec. 6103 of the IRS Code provides that tax returns are to be kept confidential, there are exceptions. Sec. 6103(f)(1) provides that “ [u]pon written request from the chairman of the Committee on Ways and Means of the House of Representatives . . . the Secretary shall furnish such committee with any return or return information specified in such request.” In making the request, Neal said that the committee was “considering legislative proposals and conducting oversight related to our Federal tax laws, including, but not limited to, the extent to which the IRS audits and enforces the Federal tax laws against a President.” At the time, the Department of Treasury refused to comply, based on a ruling of the Department of Justice's Office of Legal Counsel. The committee then sued the IRS and its commissioner and the Department of the Treasury and its secretary.

In June 2021, after Joe Biden became president, Neal wrote again to the secretary of the Treasury and commissioner of the IRS, requesting essentially the same information, with the addition of more recent returns. The committee sought Trump’s returns for the tax years 2015 through 2020.  In this request, however, Neal  offered more detail as to why the committee wanted this information. He said that the committee continued “to consider and prioritize legislation on equitable tax administration, including legislation on the President’s tax compliance, and public accountability,” as well as legislation related to the IRS’s mandatory audit program of the sitting president’s returns. In July 2021, the Department of Justice's Office of Legal Counsel reversed its initial holding and found that the 2021 request was valid, and therefore that Treasury had no choice but to comply with it according to the mandatory language of Sec. 6103(f)(1).

Trump sued, claiming—against both the committee and Treasury—that the request lacked a legitimate legislative purpose and violated the separation of powers. Against Treasury, he alleged that Sec. 6103(f)(1) is facially unconstitutional and that compliance with the request would be a violation of the First Amendment.

The appeals court addressed four issues on appeal: (1) Whether the chairman’s request is supported by a legitimate legislative purpose, (2) whether the chairman’s request violates the separation of powers, (3) whether Sec. 6103(f)(1) is facially unconstitutional, and (4) whether Treasury’s compliance with the request would violate the First Amendment.  

With regard to the first issue, the appeals court found that the requested returns could inform tax legislation concerning the president. Because of that holding, it said that it did not need to reach the question of whether the request could inform legislation concerning a president’s conflicts of interest. About separation of powers, the court found that “while the burden to the Trump Parties having their returns and return information shared with the Committee is concrete, any burden to the sitting President or the Executive Branch as a whole is tenuous at best. Regardless, neither burden, under any test, proves sufficient to require us to enjoin the Chairman’s Request for the returns and return information.” 

With regard to the constitutionality of Sec. 6103(f)(1), the appeals court found that the statute does not penalize private conduct; “it regulates how the government interacts with itself.  … If the statute is constitutional in ‘at least one scenario’—and the court cited cases where it was—“the facial challenge fails.” Finally, the court dismissed the First Amendment claim, stating, “Where, as here, the Executive Branch comes to the conclusion that a § 6103(f)(1) request is valid, it has no choice but to comply with the request. Any motive, retaliatory or otherwise, becomes irrelevant. Therefore, the Trump Parties’ First Amendment claim, like their other claims, fails.” 

Reacting to the opinion, Rep. Neal said, “With great patience, we followed the judicial process, and yet again, our position has been affirmed by the Courts.” 

The appeals court’s ruling came down on Tuesday, a day after FBI agents searched Trump’s residence at his Mar-a-Lago Club in Palm Beach, Fla., pursuant to a warrant, as part of an investigation into the removal of sensitive documents from the White House when he left office in 2021. On Wednesday, Trump invoked the Fifth Amendment, refusing to answer deposition questions by the New York state attorney general’s office pertaining to a civil investigation into his company’s business practices, according to the New York Times.