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Explainer: Ways Trump’s tax returns could come to light

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By Reuters
Explainer: Ways Trump’s tax returns could come to light
FILE PHOTO: U.S. President Donald Trump speaks during a joint news conference with Turkey's President Tayyip Erdogan at the White House in Washington, U.S., November 13, 2019. REUTERS/Tom Brenner/File Photo   -   Copyright  Tom Brenner(Reuters)

By Brendan Pierson

NEWYORK (Reuters) – U.S. President Donald Trump broke with a decades-long tradition of U.S. presidential candidates by not releasing his tax returns during his campaign, prompting state and congressional investigators to seek the returns through other means.

On Thursday, Trump is due to file a petition urging the U.S. Supreme Court to overturn a ruling by a federal appeals court in Manhattan allowing his longtime accounting firm, Mazars LLP, to hand eight years of his returns over to New York prosecutors.

The case is one of several legal battles in which investigators are seeking access to Trump’s tax returns. Below are four ways they could succeed.

1. Mazars could hand the returns over to the Democratic-led U.S. House of Representatives Oversight Committee.

The committee subpoenaed Mazars for Trump’s financial records, including tax returns, in April. It said the committee said it needed the records to determine if Trump – whose business interests have ranged from real estate and golf courses to a reality TV show – complied with laws requiring disclosure of his assets, and to assess whether those laws need to be changed.

Trump sued in April, arguing that the committee’s subpoena was politically motivated and exceeded limits on congressional investigative power.

A federal district court and an appeals court in Washington have both upheld the committee’s authority to enforce the subpoena. On Wednesday, the appeals court declined to reconsider its ruling, setting the stage for an appeal to the Supreme Court.

2. Mazars could give the returns to New York state prosecutors.

Manhattan District Attorney Cyrus Vance issued a subpoena to Mazars in August, seeking eight years of Trump’s returns as part of a criminal investigation. Trump’s lawyers sued to block the subpoena, arguing that as a sitting president, Trump had absolute immunity from state criminal investigations.

The investigation involves alleged hush money payments made shortly before the 2016 presidential election to two women who have said they had sexual relationships with Trump, which he denies.

Last month, a federal judge in Manhattan ruled that Trump was not immune from investigation, and on Nov. 4, an appeals court upheld that ruling, prompting Trump’s expected petition to the Supreme Court on Thursday.

Vance’s office has agreed not to enforce the subpoena while the appeal is pending. It has also said that if it obtains the returns, they will remain confidential.

3. The House Ways and Means Committee could get the tax returns from the U.S. Treasury Department.

U.S. Representative Richard Neal, chair of the committee, asked the Treasury Department to turn over six years of Trump’s tax returns in April. Federal law states that the Treasury “shall furnish” tax returns to Congress upon request.

U.S. Treasury Secretary Steven Mnuchin has refused to hand over Trump’s returns. The committee in July filed a lawsuit in federal court in Washington, D.C. seeking to compel the Treasury to comply. In August, the judge overseeing the case declined to fast-track the litigation, meaning the dispute is likely to extend well into 2020.

4. States could obtain the returns through new laws.

Democratic California Governor Gavin Newsom in July signed a law requiring presidential candidates to release five years of tax returns in order to appear on a nominating ballot in the state.

Trump sued to block the law, saying it violated the U.S. Constitution. A federal judge sided with the president last month, and the law remains in limbo while the state appeals.

Similarly, Democratic New York Governor Andrew Cuomo in July signed a law requiring state authorities to hand state tax returns over to Congress. However, Neal has said the law may not be relevant to his inquiry, which focuses on Trump’s federal returns.

Trump sued New York’s attorney general and tax commissioner in Washington federal court over the law, but a judge on Monday ruled he did not have jurisdiction over the state officials and that Trump would have to sue them in New York.

(Reporting by Brendan Pierson in New York; Editing by Bill Berkrot and Lisa Shumaker)