On October 2, 2016, The New York Times published an article that included the first pages of Donald Trump’s and his then-wife Marla Maples’ New York, Connecticut and New Jersey income tax returns from 1995.
The tax returns revealed Trump had a loss of nearly one billion dollars for that year, leading to speculation that Trump could have used that loss to avoid paying federal income taxes for up to eighteen years. The unauthorized disclosure of tax return information carries with it the threat of punishment. The anonymous tipster in this case, if caught, can face prosecution.
Further, the disclosure of tax return information by The New York Times carries with it the possibility of punishment for that organization, which bumps directly into the First Amendment right of the press to free speech. New York, Connecticut and New Jersey each have laws regarding the unauthorized disclosure of tax return information that include fines of $1,000.00 or more and imprisonment, including the loss of your job if you are a state employee.
Similarly, IRS employees are prohibited from making unauthorized disclosure of tax return information unless otherwise permitted by law. The punishment can include up to five years in prison and a fine in the amount of $5,000.00. Individuals that prepare tax returns and who knowingly or recklessly make an unauthorized disclosure of tax return information can be imprisoned for up to one year and fined up to $1,000.00. IRS Circular 230, which governs practice by accountants, enrolled agents, tax attorneys and CPAs before the IRS, can be sanctioned by the IRS, including disbarment, for unauthorized disclosure of tax return information.
Because The New York Times did not solicit the tax return that was ultimately published, the newspaper is likely protected by the First Amendment. However, had The New York Times solicited that information, it could be subject to punishment for publishing private information.
Finally, pending legislation entitled The Presidential Transparency Act would require major party presidential candidates to disclose 3 years of tax return information to the Federal Election Commission no later than 15 days after receiving their party’s nomination. All of this discussion regarding tax returns, including the ultimate disclosure of Trump’s state tax returns, was caused by Trump’s continuing refusal to release his tax returns.
We continue to believe that Trump should release his tax returns so that the electorate can use that information, along with all of the other information that is readily available to it, to determine whether to vote for him. What do you think?