It will take time for lawmakers and the public to digest the trove of documents relating to former President Donald Trump’s tax returns released Tuesday night by the House Ways and Means Committee.
Trump repeatedly defied convention and refused to release his tax returns both as a presidential candidate and as a sitting president.
The committee, which is responsible for IRS oversight and writing tax policy, had long sought and finally obtained just a few weeks ago Trump’s tax returns for 2015 through 2020. Its stated aim was to review “how the IRS enforces the federal tax laws against, and ensures compliance by a president.”
Here are some of the top initial takeaways from the committee’s report, which includes both its analysis of the IRS presidential audit program and an analysis of Trump’s returns by the nonpartisan Joint Committee on Taxation.
Committee says IRS failed to properly audit Trump
The Ways and Means Committee asserts that the IRS presidential audit program was “dormant” during Trump’s term.
The report found that during Trump’s time in office the IRS opened only one “mandatory” audit – for his 2016 tax return. And that didn’t take place until the fall of 2019, after Chairman Neal first sent a letter asking the IRS for Trump’s returns and tax information.
It also notes that the agency had opened an audit earlier that year for his 2015 return but it was not designated as mandatory.
The 2017 tax return, meanwhile, was marked as “evaluated and picked up for examination, if necessary.”
It remains unclear why the IRS wasn’t more active in auditing Trump’s returns while president.
“Despite knowledge of an ongoing Congressional investigation and the Manual, no priority was given to the mandatory audit program by the prior Administration,” the report asserts.
Sen. Ron Wyden, who chairs the tax writing committee in the Senate, said Wednesday “the IRS was asleep at the wheel, and the presidential audit program is broken. There is no justification for the failure to conduct the required presidential audits until a congressional inquiry was made. I have additional questions about the extent to which resource issues or fear of political retaliation from the White House contributed to lapses here.”
Many Democrats, including those on the committee, as well as tax policy experts suggest that a lack of resources, including manpower to handle highly complex audits like those of Trump, may also be a factor.
“It’s easy to find the IRS deficient. They’re starved for resources. Rich guys can take advantage of the tax law because the IRS doesn’t have the resources to go after them,” said Steven M. Rosenthal, senior fellow in the Urban-Brookings Tax Policy Center at the Urban Institute.