The Supreme Court on Monday cleared the way to allow the Manhattan district attorney to obtain eight years of federal income tax and financial records of former President Donald Trump after it denied Trump’s last-ditch Supreme Court petition to get the court to hear his case. The decision marks the end of a long-running battle of prosecutors’ access to the documents.
In a brief unsigned order, the Supreme Court rejected an appeal from Trump to hear a case against the Manhattan district attorney, Cyrus Vance, who had subpoenaed Trump’s tax and financial records. Vance, who has been investigating Trump for the past two years, will now be finally able to obtain Trump’s tax records for eight years between 2011 and 2019. These documents will still be subject to secrecy rules which will restrict their public release.
The ruling is a harsh loss for Trump, who had worked hard for years to stop anyone from obtaining his tax records and has consistently refused to publicize them. Nevertheless, The New York Times obtained some of Trump’s tax data last year, and the results are jarring—in the previous 15 years, he paid no federal income tax for 10 of those years, and in 2017, just $750 in federal tax. To avoid publicizing his records, he had claimed that the IRS was auditing him, and he would release them after the audit. That excuse does not hold water, though, since many people have publicized their tax records while they were under IRS audit, including former President Richard Nixon.
The likeliest reason why Trump has refused to publicize his tax records is that they would reveal that he hasn’t paid taxes for many years, and he is also under hundreds of millions of dollars in tax. He dodged taxes by claiming insanely high ($900 million) and losses from his businesses. Also, in the aforementioned report from The Times, it was revealed that he has mortgages worth hundreds of millions of dollars due in just a year’s time and could possibly owe the IRS up to $100 million should he lose his dispute with the agency.
With the nation’s highest court rejecting Trump’s final bid to shield his final records, Vance, the Manhattan district attorney, will be able to obtain the records within a few days. The documents will be provided by Mazars USA, Trump’s accounting firm. There were no noted dissents in the order released by the court on Monday.
The Supreme Court had ruled last year that Trump could not claim executive immunity from a New York state criminal subpoena demanding his tax return records as he, the president, was not subject to any heightened standards with regard to this issue. The case was sent back to a lower court to determine the scope of the subpoena, and last October, a U.S. court of appeals ruled that the documents sought in the subpoena were “run-of-the-mill documents typically relevant to a grand jury investigation into possible financial or corporate misconduct.” Trump’s lawyers had sent the case back up into the Supreme Court and petitioned for it to hear their appeal, but the justices rejected this petition via Monday’s order.
In response to the court order, Trump issued a lengthy statement, denouncing the investigation by Vance as a “witch hunt” and a politically motivated attack against him by Democrats, and said that the court should not have let this “fishing expedition” happen.
The current inquiry by Vance, which investigates whether the Trump Organization violated state laws and the legality of Trump’s tax deductions, was begun in 2019 and originally started out investigating alleged hush-money payments between Michael Cohen, a former Trump attorney, and two women who claimed they had affairs with Trump during the 2016 presidential campaign. Other issues the inquiry has grown to look at include Trump and the Trump Organization’s loans from Deutsche Bank and Ladder Capital, whether the organization had inflated assets when seeking loans and deflated them when filing taxes, and tax deductions taken on Trump property located in New York.
Besides Trump’s tax returns, Vance will now obtain a whole slew of other documents, which he has said are crucial to his investigation. These documents include business records on which the tax returns are based, communications between Mazars and the organization, and other related documents.
Even so, tax returns don’t reveal everything, and they are only one piece of the puzzle. Filing a criminal charge against Trump, which the district attorney has not even decided whether or not he will do yet, is quite difficult because it isn’t easy to charge someone with tax fraud, especially since most of this is done with the help of accounting or legal firms. Also, real estate valuation is complex and could provide Trump with some room to maneuver.
Another complication with the investigation is that Vance is not likely to finish it before he leaves office at the end of his term this year. He is not expected to run for reelection, and some other Democrats with prosecutor backgrounds have already declared intentions to fill Vance’s seat.
There will now be a long and grueling process ahead for Vance and his office as a new phase kicks off with the obtainment of the records and documents. It will likely take at least a while before we see any significant new developments on this case. Make sure to stay tuned as we will have a new post once new developments come through.
Yeah! Now the fun begins!