Treasury Watchdog Opens Investigation Into Handling Of Trump Tax Return Request

An internal agency watchdog will review whether the Trump administration failed to follow regular procedures when it denied a congressional request for President Donald Trump ’s tax returns. 

The acting inspector general for the Treasury Department, which oversees the Internal Revenue Service, will conduct the inquiry in response to a request from House Ways and Means Committee Chairman Richard Neal (D-Mass.).

Neal asked Monday for the inspector make sure Treasury and the IRS are “enforcing the law in a fair an impartial manner and no one is endeavoring to intimidate or impede government officials and employees carrying out their duties.”

Acting inspector general Rich Delmar confirmed he would undertake the inquiry in an email on Friday, according to the New York Times .

The IRS automatically audits the president and vice president every year, and over the summer a whistleblower complained to Congress that someone had tried to interfere with that audit . 

The tax whistleblower has received renewed attention as another whistleblower’s complaint that the president corrupted U.S. foreign policy for his own electoral benefit has prompted Democrats to launch a formal impeachment inquiry in the House of Representatives. 

Neal quietly revealed the existence of the tax whistleblower’s complaint in an August court filing that said a federal employee had come forward with “evidence of possible misconduct.” 

The Ways and Means Committee has sued the administration over its refusal to hand over copies of the president’s taxes under a federal law that says the Treasury secretary “shall” do so. 

There will probably be plenty for the IG to investigate. The tax disclosure law has been on the books since 1924, and Democrats have contended in their court filings that the IRS has never before refused to hand over a tax return requested by a congressional tax committee. The IRS didn’t hesitate to hand over tax material on President Richard Nixon, for instance, when lawmakers asked for it in the 1970s. 

Trump is the first president since Nixon to keep his taxes a secret. 

An internal IRS memo that surfaced earlier this year said the law gives the bureau no wiggle room to refuse requests. 

“I think the IG will focus on process,” said Steve Rosenthal, a senior fellow with the nonpartisan Tax Policy Center. “I think the IRS refusal was unprecedented and illegal and I think it didn’t follow the ordinary course of any other request.”

Another line of investigation could focus on Treasury Secretary Steve Mnuchin’s decision to intervene in the tax return request, which is typically handled by the IRS without the Treasury secretary butting in . 

But if the IG finds that the Treasury Department failed to follow the law or its own procedures, the finding would likely have little practical effect, as the agency could simply ignore it. And the inspector would likely reach his conclusion after a long time, meaning not this year and possibly not next year, either.

“It will come much too late,” Rosenthal said.