WASHINGTON (CN) – A nonprofit fighting to uncover the president’s tax returns pushed the D.C. Circuit on Thursday about statements from Donald Trump Jr. about his father’s Russian assets.
“The president has never corrected the record,” EPIC attorney John Davisson said Thursday in a 45-minute hearing. “The IRS has the ability to correct that record, and it may do so under section 6103 of the internal revenue code.”
Part of the Tax Reform Act of 1976, as noted in EPIC’s appeal brief, section 6103 allows the Joint Committee on Taxation to authorize disclosure “in cases where the taxpayer has made a misstatement of fact that impugns the agency or provokes noncompliance.”
EPIC, short for the Electronic Privacy Information Center, argues that the exception applies in this case because President Trump has made conflicting statements about whether his tax returns will show income originating in Russia.
Undercutting the president’s denials of any investments in Russia, Trump’s own lawyers have indicated “multiple sources of Russian income that would appear in his ‘personal returns,’” according to EPIC’s brief.
Trump Jr. has also alluded to the Trump Organization’s Russian assets in several interviews.
Aside from Trump’s tax returns from 2010 through 2017, the complaint EPIC filed against the IRS last year also demanded tax information concerning potential financial ties between the president and Russian businesses or the Russian government.
The IRS denied EPIC’s request and its appeal, saying the request was imperfect since it lacked third-party consent to release the tax information.
Though most presidential candidates since 1976 have voluntarily released at least a year’s worth of tax returns, Trump has so far refused to do so.
EPIC took its case to the D.C. Circuit after a federal judge found that the president’s tax returns can’t be released without his consent – a requirement the IRS imposed as a prerequisite before it would even process the request under the Freedom of Information Act.
The IRS has cited section 6103 in its appeal brief as well, saying that tax returns are confidential and can be disclosed only to an individual taxpayer or “to someone with a statutorily specified relationship to the taxpayer, or for a statutorily specified purpose.”
U.S. District Judge James Boasberg noted in his ruling last year that the IRS is under no obligation to request disclosure of Trump’s filings from the Joint Committee on Taxation.
U.S. Circuit Judge Patricia Millet pressed the IRS Thursday to explain why its regulation requiring third-party consent doesn’t conflict with the FOIA, which she said bestows a right to information unless an exemption applies.
“That’s what FOIA says,” she added. “And then the burden to show the exemption is on the government.”
Justice Department attorney Michael Murray said those who utilize the FOIA to request information must also comply with an agency’s reasonable policies.
The exception to 6103 does not confer a right to disclosure, Murray added.
Millet on the other hand noted that the exception doesn’t contain a consent requirement, and doesn’t require EPIC to show that the exception applies.
“They just say I’d like these documents, correct,” Millett said. “That’s a perfected FOIA request. I’d like these documents.”
But Murray argued that it’s completely reasonable for the IRS to require EPIC to establish a right to the material they requested.
He also pushed back on Millett’s assertion that the government carries the burden of proving an exemption applies.
Courts have held that the plaintiff must demonstrate the information is eligible for release, he said.
“And the plaintiff has not shown that here,” Murray added.
Murray urged the panel to affirm the District Court and find that the conditions to satisfy the exemption don’t apply.
According to EPIC’s trial brief, the IRS’ refusal to even process its request based on the consent requirement places the agency “beyond the reach of the Freedom of Information Act.” That is something Congress did not intend, EPIC argued, and the court should not allow it.
Rather than have the appeals panel decide whether the regulatory exception creates a right to public disclosure, EPIC attorney Davisson urged the court to kick the matter back to the IRS.
While Millett posed tough questions to the government, she also pressed Davisson on what the exemption means, noting that the IRS asserted that the exemption doesn’t create rights when it denied EPIC’s FOIA appeal.
“There’s nothing here that says the public has a right to information,” she said.
U.S. Circuit Judges Karen LeCraft Henderson and Harry Edwards presided along with Millett over Thursday’s hearing, which lasted about 45 minutes. They did not indicate when they would issue a ruling.