Tag Archives: Tax Returns

Trump fails to block tax return subpoena, will appeal to Supreme Court

By Jonathan Stempel

NEW YORK (Reuters) – A federal appeals court on Wednesday rejected Donald Trump’s effort to block Manhattan’s district attorney from obtaining eight years of his tax returns for a criminal probe into the U.S. president and his businesses.

In a 3-0 decision, the 2nd U.S. Circuit Court of Appeals in Manhattan rejected Trump’s accusations that a grand jury subpoena from Manhattan District Attorney Cyrus Vance was overly broad, or issued in bad faith to harass him.

“The President has a ‘difficult’ burden and an ‘unenviable’ task: to make plausible allegations that could persuade the court that the subpoena that has been served on him could not possibly serve any investigative purpose that the grand jury could legitimately be pursuing,” it wrote. “His complaint fails to do so.”

Wednesday’s decision heralds a renewed clash between Trump and Vance at the U.S. Supreme Court.

That court in July rejected the Republican president’s argument he was immune from criminal probes while in the White House.

But it said he could raise other objections to the subpoena to his longtime accounting firm, Mazars USA, for his corporate and personal tax returns from 2011 to 2018.

Jay Sekulow, a lawyer for Trump, said the president will appeal to the Supreme Court. Both sides agreed Vance would not enforce the subpoena during an appeal, according to court papers.

A spokesman for Vance did not immediately respond to a request for comment.

The unsigned decision upheld an Aug. 20 ruling by U.S. District Judge Victor Marrero in Manhattan.

It followed a Sept. 28 report in The New York Times that Trump had paid $750 in federal income taxes in both 2016 and 2017, and no income taxes in 10 of the prior 15 years, reflecting “chronic” losses he used to avoid paying taxes.

Trump has rejected findings from the Times report, tweeting that he had paid many millions of dollars in taxes but was entitled to depreciation and tax credits.

He has long resisted making his tax returns public, unlike his six immediate predecessors occupying the White House.

‘IMPLAUSIBLE’ CLAIM

Vance’s probe began more than two years ago, and had focused on hush money payments that the president’s former lawyer and fixer Michael Cohen paid before the 2016 election to two women who said they had sexual encounters with Trump.

The district attorney has suggested in recent court filings that his probe is now broader and could focus on bank, tax and insurance fraud, as well as falsification of business records.

Trump argued that the probe was still focused on the Cohen payments, making the subpoena an improper “fishing expedition” targeting his business interests around the world, and said Vance improperly copied a similar congressional subpoena.

But the appeals court called it “implausible” speculation to suggest the probe was limited to the Cohen payments.

The court said grand juries “necessarily paint with a broad brush,” especially in complex financial investigations, and do not know at the outset what their needs are.

It also found “no logic” to suggest the documents Vance wanted were irrelevant to legitimate law enforcement purposes, just because a congressional committee wanted the same documents for its own investigation.

The court also found no specific allegations that partisanship motivated Vance, a Democrat, to seek Trump’s tax returns.

All three judges on the appeals court panel were appointed by Democratic presidents. Five of the eight current Supreme Court justices were appointed by Republican presidents.

Even if Vance gets Trump’s tax returns, grand jury secrecy rules make it unlikely he will reveal their contents unless criminal charges were brought. If that happened, it would likely occur after the Nov. 3 election.

(Reporting by Jonathan Stempel in New York; Additional reporting by Karen Freifeld in New York, and Alexandra Alper and Sarah N. Lynch in Washington; Editing by Chizu Nomiyama, Steve Orlofsky and Andrea Ricci)

U.S. Supreme Court allows prosecutor but not Congress to get Trump’s financial records

By Lawrence Hurley and Jan Wolfe

WASHINGTON (Reuters) – The U.S. Supreme Court on Thursday firmly rejected President Donald Trump’s argument for sweeping presidential immunity and ruled that a New York prosecutor can obtain his financial records but prevented – at least for now – Democratic-led House of Representatives committees from getting similar documents.

Both 7-2 rulings were authored by conservative Chief Justice John Roberts. The court made it clear that a sitting president cannot evade a criminal investigation, ruling that the subpoena issued to Trump’s long-term accounting firm, Mazars LLP, for various financial records to be turned over to a grand jury as part of a criminal investigation can be enforced.

But the court sidestepped a major ruling on whether three House committees could also obtain Trump financial documents under subpoena, giving Trump at least a short-term win. Litigation will now continue in lower courts in both cases.

In both rulings, Roberts was joined by the four liberal justices as well as Trump’s two conservative appointees to the court, Justices Brett Kavanaugh and Neil Gorsuch. Conservative Justices Clarence Thomas and Samuel Alito both dissented.

“This is a tremendous victory for our nation’s system of justice and its founding principle that no one – not even a president – is above the law,” said Manhattan District Attorney Cyrus Vance, a Democrat, in relation to the ruling in his case.

Vance and the House committees all issued subpoenas to third parties for the records, not the Republican president himself.

Trump turned to Twitter complained about the rulings, writing on Twitter: “Courts in the past have given ‘broad deference’. BUT NOT ME!” He added, “This is all a political prosecution … and now I have to keep fighting in a politically corrupt New York. Not fair to this Presidency or Administration!”

The New York case ruling does not mean the documents will be handed over immediately because of expected wrangling in lower courts. A final outcome could be delayed in both cases until after the Nov. 3 election in which Trump is seeking a second term in office.

“We will now proceed to raise additional constitutional and legal issues in the lower courts,” said Jay Sekulow, Trump’s personal lawyer.

House Speaker Nancy Pelosi said Democrats would not stop investigating Trump and would press forward in seeking to enforce the subpoenas.

“Congress’s constitutional responsibility to uncover the truth continues, specifically related to the President’s Russia connection that he is hiding,” Pelosi said, in reference to the contention that Trump’s financial records could show such an entanglement.

NO ‘ABSOLUTE’ IMMUNITY

Roberts rejected both the broad arguments for presidential immunity made by Trump’s lawyers and the sweeping arguments made in favor of the House’s ability to investigate the president.

Trump’s argument that he was immune from any criminal process “runs up against the 200 years of precedent establishing that Presidents, and their official communications, are subject to judicial process,” Roberts wrote in the New York case.

“We affirm that principle today and hold that the president is neither absolutely immune from state criminal subpoenas seeking his private papers nor entitled to a heightened standard of need,” Roberts added.

Roberts also rejected the suggestion that the decision would subject future presidents to harassment by local prosecutors, noting that the court in 1997 rejected a similar argument made by President Bill Clinton when he faced a civil lawsuit brought by Paula Jones, a woman who accused him of making unwanted sexual advances.

“Given these safeguards and the court’s precedents, we cannot conclude that absolute immunity is necessary or appropriate,” Roberts wrote.

Roberts’ analysis of the congressional subpoenas hinged on the competing political interests between different branches of government.

“Congressional subpoenas for the President’s personal information implicate weighty concerns regarding the separation of powers,” Roberts wrote. “Neither side, however, identifies an approach that accounts for these concerns.”

Unlike other recent presidents, Trump has refused to release his tax returns and other documents that could provide details on his wealth and the activities of his family real-estate company, the Trump Organization. The content of these records has remained a persistent mystery even as he seeks re-election.

House committees issued subpoenas seeking Trump’s financial records from his longtime accounting firm Mazars LLP and two banks, Deutsche Bank and Capital One.

As part of a criminal investigation by Vance’s office, subpoenas were issued to Mazars for financial records including nearly a decade of Trump’s tax returns to be turned over to a grand jury in New York City.

The investigation launched by Vance’s office in 2018 into Trump and the Trump Organization was spurred by disclosures of hush payments to two women who said they had past sexual relationships with him, pornographic film actress Stormy Daniels and former Playboy model Karen McDougal. Trump and his aides have denied the relationships.

In the litigation over the House subpoenas, Trump argued that Congress lacked a valid purpose for seeking his records and that disclosure of the material would compromise his and his family’s privacy and distract him from his duties.

In the New York case, Trump’s lawyers argued that under the Constitution he is immune from any criminal proceeding while serving as president. In a lower court hearing, Trump’s lawyers went so far as to argue that law enforcement officials would not have the power to investigate Trump even if he shot someone on New York’s Fifth Avenue.

The House Oversight Committee in April 2019 issued a subpoena to Mazars seeking eight years of accounting and other financial information in response to the congressional testimony of Michael Cohen, Trump’s former lawyer. Cohen said Trump had inflated and deflated certain assets on financial statements between 2011 and 2013 in part to reduce his real estate taxes.

The House Financial Services Committee has been examining possible money laundering in U.S. property deals involving Trump. In a separate investigation, the House Intelligence Committee is investigating whether Trump’s dealings left him vulnerable to the influence of foreign individuals or governments.

(Reporting by Jan Wolfe and Lawrence Hurley in Washington; Additional reporting by Andrew Chung; Editing by Will Dunham)

Trump’s accounting firm must hand over eight years of tax returns, court rules

Trump’s accounting firm must hand over eight years of tax returns, court rules
By Brendan Pierson

NEW YORK (Reuters) – President Donald Trump’s longtime accounting firm must hand over eight years of his tax returns to New York prosecutors, a U.S. appeals court ruled Monday in the latest setback for Trump in his tenacious efforts to keep his finances secret.

The ruling by a unanimous three-judge panel of the New York-based 2nd U.S. Circuit Court of Appeals backed the ability of prosecutors to enforce a subpoena for the returns against accounting firm Mazars LLP. Jay Sekulow, a lawyer for Trump, said the Republican president will appeal the ruling to the U.S. Supreme Court, whose 5-4 conservative majority includes two justices appointed by Trump.

The office of Manhattan District Attorney Cyrus Vance, a Democrat, is seeking the returns as part of a criminal investigation into Trump and his family real estate business. The scope of that probe is not publicly known.

The 2nd Circuit did not decide whether Trump is immune from being charged with a state crime while in office, as the president has argued. However, it found that even if he is, the immunity could not stop Vance from getting the returns from a third party, or from prosecuting him once he leaves office.

It would “exact a heavy toll on our criminal justice system to prohibit a state from even investigating potential crimes committed by him for potential later prosecution,” 2nd Circuit Chief Judge Robert Katzmann wrote in the ruling.

Vance’s office has agreed not to enforce the subpoena while Trump petitions the Supreme Court. Under the agreement, Trump has 10 business days to file the petition.

Trump, who built a real estate empire with his New York-based business before becoming president, separately faces an impeachment inquiry in the Democratic-led U.S. House of Representatives.

BREAKING TRADITION

Trump has refused to make his tax returns public, breaking with a decades-old tradition of U.S. presidential candidates releasing their returns during campaigns and presidents disclosing them while in office. More broadly, Trump has fought efforts by Democrats in Congress and others to obtain information about his finances and a range of other matters.

In a similar dispute, Treasury Secretary Steven Mnuchin in May refused to release Trump’s tax returns to a House committee, saying the request was not based on “a legitimate legislative purpose.” The House then sued the Treasury Department and the Internal Revenue Service in July to try to get access to the tax records. The U.S. Court of Appeals for the District of Columbia Circuit on Oct. 11 ruled in favor of the House bid to obtain Trump’s financial records from Mazars.

In August, Vance subpoenaed Trump’s personal and corporate tax returns from 2011 to 2018, and other records from Mazars USA, the president’s longtime accounting firm. Trump sued Vance’s office in Manhattan federal court to try to block the subpoena, arguing that as a sitting president, he cannot be subject to criminal investigation.

On Oct. 7, U.S. District Judge Victor Marrero threw out Trump’s lawsuit, calling his claim of immunity “repugnant to the nation’s governmental structure and constitutional values.” The ruling prompted Trump’s appeal to the 2nd Circuit.

Arguing before the appeals court on Oct. 23, a lawyer for Trump made the claim of immunity more explicit, saying state authorities would be powerless to act against the president even if he shot someone on the street unless he were removed from office first.

Katzmann wrote in Monday’s order that the extent of the president’s immunity was irrelevant to the case.

“The subpoena at issue is directed not to the President, but to his accountants; compliance does not require the President to do anything at all,” Katzmann wrote.

Katzmann was appointed to the court by former President Bill Clinton, a Democrat. The other two judges on the panel, Christopher Droney and Denny Chin, both appointed by former President Barack Obama, Trump’s predecessor and also a Democrat.

A spokesman for Vance declined to comment on the ruling.

Trump filed his own lawsuit in July seeking to block the House Ways and Means Committee from invoking a New York law that allows it to request his state tax returns. That case remains pending.

The House impeachment inquiry focuses on the president’s request in a July phone call for Ukrainian President Volodymyr Zelenskiy to investigate a domestic political rival, Joe Biden, the former vice president and a top contender for the 2020 Democratic presidential nomination to face Trump.

(Reporting by Brendan Pierson in New York; Editing by Will Dunham and Chizu Nomiyama)

Judge orders Trump to hand over tax returns to NY prosecutors

By Jonathan Stempel

NEW YORK (Reuters) – A federal judge on Monday said U.S. President Donald Trump must hand over eight years of tax returns to Manhattan prosecutors, forcefully rejecting the president’s argument that he was immune from criminal investigations.

Trump’s immunity claim was “repugnant to the nation’s governmental structure and constitutional values,” U.S. District Judge Victor Marrero wrote in a 75-page decision.

“The court cannot square a vision of presidential immunity that would place the President above the law,” Marrero added.

Trump quickly filed an emergency appeal to the 2nd U.S. Circuit Court of Appeals in Manhattan, which temporarily blocked Manhattan District Attorney Cyrus Vance from enforcing the subpoena, citing the “unique issues” in the case.

Marrero’s decision would have forced Trump’s longtime accounting firm Mazars USA to start turning over documents on Monday afternoon.

The decision further complicates Trump’s battle to keep his finances under wraps, despite having promised during his 2016 White House run that he would disclose his tax returns.

Vance, a Democrat, had subpoenaed personal and corporate tax returns from 2011 to 2018 and other records from Mazars, as part of a criminal probe into the president and his family business.

“The Radical Left Democrats have failed on all fronts, so now they are pushing local New York City and State Democrat prosecutors to go get President Trump,” Trump, a Republican, tweeted after Marrero’s decision. “A thing like this has never happened to any President before. Not even close!”

HOUSE PROBE

In suing Vance last month to block the subpoena, Trump argued that he was immune from criminal probes while in office, and the U.S. Constitution required Vance to wait until after he left the White House.

Trump is separately trying to block Deutsche Bank AG from handing over financial records, which the bank has said include tax returns, sought by multiple U.S. House of Representatives committees.

Those probes is separate from the debate over whether Trump should be impeached because of his dealings with Ukraine.

The 2nd Circuit appeals court heard oral arguments in the Deutsche Bank case on Aug. 23. It has yet to rule.

Jay Sekulow, a lawyer for Trump, said he was pleased the subpoena would not be enforced immediately. Danny Frost, a spokesman for Vance, declined to comment.

Both sides proposed schedules to allow oral arguments in Trump’s appeal later this month.

Mazars did not respond to requests for comment, but has said it would comply with its legal obligations. The U.S. Department of Justice, which opposed Vance’s bid to dismiss Trump’s case, declined to comment.

‘OVERREACH OF EXECUTIVE POWER’

Marrero, who was appointed by Democratic President Bill Clinton, declined to assert jurisdiction over the Vance subpoena, saying Trump should have brought his case in a New York state court.

The judge, however, made clear that if the appeals court disagreed with that finding, Trump should lose.

Marrero said Trump failed to show that enforcing the subpoena would interfere with his presidential duties, cause irreparable harm or be against the public interest.

He also rejected as too broad the idea that the president, his family and his businesses should be shielded from criminal process.

“The expansive notion of constitutional immunity invoked here to shield the President from judicial process would constitute an overreach of executive power,” Marrero wrote.

Marrero said even President Richard Nixon had conceded during the Watergate scandal that he would be required to produce documents in response to a judicial subpoena.

In seeking a stay, Trump’s lawyers said the case raised “momentous” questions about the president’s immunity and that complying with the subpoena would cause irreversible damage.

“There will be no way to unscramble the egg scrambled by the disclosure,” Trump’s lawyers said.

Vance issued the subpoena four weeks after issuing another subpoena to the Trump Organization for records of hush money payments, including to two women prior to the 2016 election who said they had sexual relationships with Trump, which he denies.

Trump is running for re-election. His current term ends on Jan. 20, 2021.

(Reporting by Jonathan Stempel in New York; Editing by Steve Orlofsky)

Protesters to take to streets to demand Trump release tax returns

U.S. President Donald Trump (R) arrives to board Air Force One at Joint Base Andrews outside Washington, U.S., before traveling to Palm Beach, Florida for the Good Friday holiday and Easter weekend, April 13, 2017. REUTERS/Yuri Gripas

By Peter Szekely

NEW YORK (Reuters) – Tens of thousands of people are expected to take to the streets across the United States and beyond on Saturday to press President Donald Trump to release his tax returns and to dispute his claim that the public does not care about the issue.

The demonstrations, organized by a loose coalition of labor and left-leaning groups with various economic agendas, are intended to focus on Trump’s refusal to disclose his tax-paying history, something his predecessors in the White House have done for more than 40 years.

“When we check in with our members, this is something they care about deeply,” said Ben Wikler, Washington director of MoveOn.org, a progressive political group.

Critics have raised questions about what Trump’s tax returns say about his net worth and about his various business ties.

Organizers of “Tax March” are planning events in more than 150 cities, including New York, Washington and Los Angeles, as well as cities in Europe, Japan and New Zealand.

As a candidate and as president, Trump has steadfastly refused to release his tax returns, citing an ongoing audit by the Internal Revenue Service. In September, he told ABC News, “I don’t think anybody cares, except some members of the press.”

The IRS has said that Trump can release his tax returns even while under audit.

The demonstrations are taking place on the traditional April 15 Tax Day, the deadline for filing federal tax returns, although the IRS this year pushed back the deadline by three days.

The Trump tax marches were launched by a single tweet, organizers said.

A day after the massive Jan. 21 women’s march in Washington and other cities, comedy writer Frank Lesser tapped out on Twitter, “Trump claims no one cares about his taxes. The next mass protest should be on Tax Day to prove him wrong.” It has been retweeted more than 21,000 times.

Organizers said they stuck with the traditional April 15 Tax Day for the marches because as a Saturday it would draw more attendance, even though this year’s income tax filing deadline was pushed back to Tuesday.

Joe Dinkin, spokesman for the Working Families Party, which is also planning the marches, said ongoing investigations into the Trump campaign’s connections with Russia underscore the need to disclose his returns.

“Without seeing his taxes we’ll never really know who he’s working for,” said Dinkin, who expects the marches to draw at least 100,000 protesters.

There have been some glimpses into Trump’s tax history. Last month, MSNBC host Rachel Maddow released two pages of Trump’s 2005 return that were obtained by investigative reporter David Cay Johnston. They showed Trump paid $38 million in taxes on more than $150 million in income. And last October, The New York Times reported that Trump had declared a $916 million loss on his 1995 federal tax return, citing three pages of documents from the return.

In a Quinnipiac University poll released on April 4, more than two-thirds of the respondents said Trump should publicly release his tax returns. Other recent polls had similar results.

(Reporting by Peter Szekely; Editing by Frank McGurty and Leslie Adler)