Deutsche Bank’s revelation that it has some tax returns related to President Trump
Donald John TrumpThe dark side of progress: We’re ignoring the most potent threat to working-class Americans West Texas mass shooting reignites gun control debate Trump says West Texas shooting ‘hasn’t changed anything’ in ongoing gun talks MORE has thrown a curve ball into the battle over the president’s financial documents.
The bank has long been seen as a possible avenue to learn more about Trump’s finances since it provided loans to his businesses for many years, even when other banks would not.
Deutsche Bank’s disclosure that it has tax returns confirms that Democrats have an additional route — one some experts think is the most promising — to get tax documents that lawmakers in the party have long sought.
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“It shouldn’t take three years and multiple court cases to see a president’s tax returns,” Ryan Thomas, spokesman for the liberal group Stand Up America, said in an email. “But with the several lawsuits underway, these latest developments are a promising avenue to ensure that the American people get the transparency they deserve.”
The House Financial Services and Intelligence committees issued subpoenas to Deutsche Bank in April for a wide range of financial records — including tax returns — from Trump, his three oldest children and some of his business entities. Trump, in his personal capacity, has sued to block the bank from complying with the subpoenas, and the case is currently before the federal appeals court in New York.
In a letter to the appeals court on Tuesday, the bank said it has tax returns responsive to the subpoenas. The bank redacted the name or names of the individuals and entities whose tax returns it has in the public version of the letter.
That disclosure confirms that Democrats’ subpoenas of Deutsche Bank could be one route — and potentially one of the fastest — to obtaining Trump’s tax returns.
Democrats have been interested in seeing Trump’s tax returns for a host of reasons as they conduct oversight of the president and his administration. Unlike other presidents in recent decades, Trump has refused to voluntarily release his tax returns.
At both the federal and state level, Democrats have taken steps designed to get Trump to disclose his tax returns to lawmakers or the public.
One of the most notable ways has been the House Ways and Means Committee’s efforts to obtain Trump’s tax returns from the IRS. The panel has filed a lawsuit to try to get a judge to order the Trump administration to comply with its requests and subpoenas for the returns.
Many tax and legal experts think Democrats will ultimately prevail in both the case involving the IRS and the case involving Deutsche Bank but think that the latter case will be resolved faster — meaning that Democrats are more likely to receive Trump-related tax returns from Deutsche Bank before the 2020 election than they are to receive tax returns from the IRS.
The Ways and Means Committee case was filed about two months ago and is still pending at the district court level.
And the Ways and Means Committee case is likely to move slowly. On Thursday, Judge Trevor McFadden, a Trump appointee in federal court in Washington, D.C., denied the committee’s motion to expedite the case and its motion for summary judgment.
“McFadden wants to be deliberate,” said Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center.
Seth Hanlon, a senior fellow at the Center for American Progress, said the Trump administration is trying to drag out the Ways and Means Committee’s lawsuit and that “there’s a chance that works.”
Mike Stern, who served in the House Office of General Counsel from 1996 to 2004, said the Supreme Court is more likely to want to consider the Ways and Means Committee’s lawsuit than the Deutsche Bank case, adding to the likelihood that the Deutsche Bank case will be the one to be resolved first.
In the Ways and Means Committee’s lawsuit against the IRS, the administration is expected to argue that the committee lacks standing to sue. The issue of congressional standing remains unresolved, and the Supreme Court might want to review the Ways and Means case on standing issues, according to Stern.
“The standing issue is much more likely to get their attention” than issues in the Deutsche Bank case, Stern said.
Trump plans to fight all efforts to have his tax returns disclosed — including in the Deutsche Bank case.
A lawyer for Trump argued in a court filing Thursday evening that the House Financial Services and Intelligence committees don’t have the authority to request tax returns from Deutsche Bank, citing a section of the federal tax code.
The House, however, argues that the tax code’s restrictions on disclosing tax returns wouldn’t bar Deutsche Bank from providing tax returns subject to subpoenas if the bank received the tax returns directly from the relevant taxpayers.
Experts said they think the House’s position is the correct one and that Trump faces an uphill battle in trying to squash the Deutsche Bank subpoenas.
“I think the House has the better argument here,” said University of Pittsburgh law professor Philip Hackney, though he also said he could see a court issuing a decision that’s in line with Trump’s arguments.
Even if Democrats get their hands on Trump’s tax returns from Deutsche Bank before the 2020 presidential election, it’s no guarantee that the documents will help them politically.
It’s not clear exactly whose tax returns Deutsche Bank has and what those documents say. It’s also unclear which years of tax returns Deutsche Bank has and how complete any tax returns the bank has are.
Maura Quint, executive director of the liberal group Tax March, said it would be “enlightening to some voters” if they have information that Trump is enacting policies that personally benefit himself.
However, Francine Lipman, a law professor at the University of Nevada, Las Vegas who serves on the state’s tax commission, argued that people may not be able to learn Trump’s business conflicts of interest from the first two pages of his returns or even his full individual tax returns. She also said it’s unlikely that findings in Trump’s tax returns would cause the president’s core supporters to sour on him.
“I don’t think it is going to change his base’s mind about his financial standing,” she said.