Can States Require Candidates For President To Release Tax Returns? Probably Not.
States are considering laws that would require candidates for President to release their tax returns, but such laws are probably unconstitutional.
Over the Easter weekend we saw protesters take to the streets in several American cities on what seems like a rather esoteric, possibly even irrelevant, topic, the fact that Donald Trump has yet to release any of his tax returns:
In a Tax Day groundswell of calls for President Trump to release his tax returns, hundreds of protesters marched to Mr. Trump’s Mar-a-Lago getaway on Saturday in Florida, and thousands more gathered in Washington and other cities across the country.
On a waterfront patch facing Mr. Trump’s resort, where he is spending the weekend, demonstrators chanted “Pay! Your! Taxes!” and held signs calling him “Chicken in Chief” — the chicken being a symbol at the rallies of how Mr. Trump was “scared” to follow decades of presidential practice in releasing the returns.
“This is the closest we have come to making sure he sees us and hears us,” said Debbie Wehking, 66, a school principal from Miami. “He needs to show us his tax returns so that we can tell who’s influencing his decisions, who he owes money to, who he’s doing business with — really so we can figure out whether he needs to be impeached.”
Mr. Trump avoided the protest, taking a more circuitous route in his motorcade as he returned from a morning outing to his golf club in West Palm Beach. But while the president was spared the sight of chanting, sign-waving crowds, the demonstrations were heard around the country, in some cases snaking past properties bearing the Trump name.
In Washington, several thousand people who had gathered at the foot of the Capitol — many holding replicas of chickens with golden pompadours — marched through the streets, passing the Trump International Hotel near the White House.
“70% want to see your taxes — that’s bigly!” one sign read. It was a reference to the lopsided majorities that polls show want the president to release his returns, as presidents have done for the past 40 years, though they are not required to.
Another said, “My taxes pay for your golf.”
The White House has said Mr. Trump cannot release his tax returns because he is under audit by the Internal Revenue Service. But the tax returns of presidents and vice presidents are automatically audited every year, a circumstance that has not prevented every other president since Richard M. Nixon from making public at least a portion of his tax records.
Government transparency groups and Democrats have said that Mr. Trump has a particular duty to make the returns public, given the potential conflicts presented by his vast business holdings and his push to rewrite the tax code. One government ethics group has sued the president, arguing that his hotel profits violate the Emoluments Clause of the Constitution, which prohibits federal officials from receiving “any present, emolument, office or title of any kind whatever from any king, prince or foreign state.”
“How can we determine his conflicts of interest or stop him from receiving payments from foreign governments if he won’t show us the names of the people and corporations that he is in active partnership with all over the world?” said Representative Jamie Raskin, Democrat of Maryland, who appeared at the Washington rally.
This isn’t a new issue, of course. Virtually from the day that he got into the race in June 2015 Trump has declined to release his tax returns for any year, citing the fact that he is allegedly under audit for multiple year’s returns as the reason for his decision. As a matter of law, of course, even if it is true that Trump is being audited there is no legal bar to him voluntarily releasing his returns for any given year, even those years currently being examined by the Federal Government. At the same time, though, may tax attorneys and accountants that have been consulted by the media over that time period have said that they would advise their client against publicly releasing the returns as long as there was an ongoing audit, citing the concern that making the information public could somehow impact the audit itself or whatever settlement negotiations might be going on regarding outstanding tax liabilities at the Federal or State level.
Notwithstanding Trump’s refusal to release returns, the public has gotten at least some glimpse at his tax picture, but it hasn’t been particularly illuminating. In October of last year, just about a month prior to the election, a reporter at The New York Times received two pages of Trump’s 1995 tax return from an anonymous source who had somehow obtained a copy of at least part of the return. The most notable thing about that partial return was that it showed that, at the time, Trump was carrying what would have likely been a multi-year deduction related to business losses in the early 1990s that, in theory, could have legally allowed him to avoid paying any real tax liability for a decade or more. More recently, MSNBC host Rachel Maddow made a big show out of the fact that she had obtained a partial copy of Trump’s 2005 tax return, which in this case didn’t really show anything extraordinary. As with the October leak, Maddow only received the two pages of Trump’s Form 1040 and not any of the Schedules or supporting documents that were likely filed with the return(s), so there was nothing particularly illuminating about the leaked documents. One notable thing about the return leaked to Maddow, though, is the fact that it did not appear that Trump was still taking the same sizeable loss deduction he had ten years earlier, although that doesn’t mean that he wasn’t still taking advantage of it, as permitted by law, in years after 1995. In any case, as I said, neither of these releases is particularly illuminating, but that isn’t stopping some activists from forcing Trump to reveal more about his taxes.
With Trump unlikely to release his returns at any point in the near future, some politicians and activists are exploring ways to force his hand. One effort has taken place in Congress where Democrats have pushed a measure that purports to use Congress’s subpoena power to force Trump to give at least ten years of returns to the House Ways & Means Committee. Thanks to Republican control of the House, of course, this effort has failed to garner even the level of support they’d need to move the measure to the Senate, where it would likely die anyway. Barring the Congressional route, others are pursuing action at the state level to pass laws that would require candidates for President to release tax returns for a certain number of years in order to get on the ballot. The state-level strategy, of course, is to at least try to trap Trump into releasing his return as the price for running for re-election. In addition to the fact that Republican control of state legislatures means that getting such a measure through any non-Democratic state is unlikely, it’s not at all clear that such state laws are even constitutional.
Harvard Law School Professor Laurence Tribe, who writes at CNN in a piece co-authored by Norman Eisen and Richard Painter of Citizens for Responsibility and Ethics argue that the states are in fact authorized to pass such laws:
Our federal Constitution allows states to create ballot access requirements that ensure that the ballots for every office, including the office of presidential elector, are comprehensible and informative.
A line must of course be drawn between permissible ballot access laws and impermissible attempts to add qualifications to those specified in the federal Constitution. But our research and analysis lead us to conclude that tax return disclosure laws such as the one proposed in California resemble ballot access laws in structure, impact, and purpose much more closely than they resemble laws imposing additional qualifications for presidential office.
As a result, we believe these laws comport fully with the U.S. Constitution.
Unlike prohibited qualifications, these laws do not impose substantive requirements on candidates beyond those imposed by the Constitution itself; that is, these laws do not limit which candidates may run for office based on any particular information in their tax return. Thus, they do not create an insurmountable barrier in advance to any set of individuals otherwise qualified under Article II of our Constitution. Instead, these laws require federally qualified candidates to comply with a relatively minor process of tax disclosure. That is something competing candidates can and should readily do in order to allow voters to make more informed judgments about those contenders’ characters or backgrounds.
The states have legitimate justifications for providing their voters with this important information. The proposed laws mandate transparency rather than interposing obstacles that some would-be candidates cannot overcome.
Tax returns provide information that is more broad, specific, and reliable than the candidate financial disclosure that is currently required. Candidate financial disclosure forms are generally designed to identify and prevent conflicts of interest — and tax return information could serve a similar function.
Indeed, this could be particularly important for a presidential candidate, as the president is exempt from some (but not all) federal laws governing conflicts of interest once in office. Prevention may be not just the best, but the only available medicine in some situations.
Pepperdine University Law Professor Derek Muller, meanwhile, argues that such laws would unconstitutionally impose additional qualifications on those eligible to run for President beyond those prescribed by Article II of the Constitution, something not permitted by the general authority granted to the states regarding the regulation of ballot access:
The Supreme Court has repeatedly held that states can’t use the ballot as a political weapon. In 1964, for instance, Louisiana listed candidates’ race on the ballot. Louisiana maintained it was just providing truthful information to the voters of the state. The Supreme Court struck down the statute on the ground that the ballot was not a vehicle to direct voters to consider a candidate’s race.
In the 1990s, Missouri asked congressional candidates to take a term limits pledge; if they refused to do so, the state would indicate on the ballot that the candidate “declined to pledge to support term limits.” The Supreme Court struck down that ballot provision, too.
Both those cases stand for the proposition that states cannot use their ballots to achieve preferred political or policy outcomes — such as burdening those who prefer to keep some, or all, of their tax information private.
The Supreme Court has, of course, permitted states to regulate access to the ballot for the purposes of separating out serious from frivolous candidates. (Common mechanisms include a modest filing fee or securing a sufficient number of voters’ signatures on a petition.) But the New Jersey bill isn’t intended to ensure that only serious candidates appear on the ballot. It’s intended to get Mr. Trump’s tax returns.
It’s understandable that many state legislatures now want presidential candidates to disclose their tax returns: Mr. Trump’s refusal to disclose was, and continues to be, an issue of concern to many voters in New Jersey and across the country. But the ballot is not a form of leverage that may be used to pressure political candidates to meet legislative demands. This issue is best addressed, as it has long been, by the political process.
Of the two arguments, it appears to me that Muller makes the far more persuasive case than Tribe and his co-authors and that any state law requiring candidates for President, or any Federal office, to release tax returns as a price for ballot access, would most likely be held unconstitutional. The most relevant case on this issue would appear to be US Term Limits v. Thornton, the Missouri case which Muller cites in the text above. In that case, Missouri purported to use ballot access laws as a backdoor to imposing term limits on Members of Congress by denying them ballot access if they have served more than the permitted number of terms, which in that case was three terms for Members of the House and two terms for Senators. Such candidates could still seek reelection via a write-in campaign, but they could not run as either the nominee of a particular party or an Independent candidate. The Court ruled that this provision, which actually became a provision of the state Constitution via a ballot measure, violated the Constitution because it imposed requirement for holding the office of Congressman or Senator beyond those set forth in Article One, Sections Two and Three, and the Seventeen Amendment, which set forth the residency and age limitations for holding those offices. The majority opinion written by Justice John Paul Stevens goes through the history behind the qualifications clauses for Congress, the powers of the states to regulate ballot access and the Tenth Amendment argument that was made in favor of the law before ultimately concluding that the attempt to impose term limit by regulating ballot access was unconstitutional. The argument used by the majority in Thornton would seem to be equally applicable to a state law requiring candidates for President to
The argument used by the majority in Thornton would seem to be equally applicable to a state law requiring candidates for President to would seem to be equally applicable to a state law requiring candidates for President to release their tax returns. As with the Missouri term limits law, such laws would effectively impose qualifications beyond those set forth in Article II, Section One, Clause 5, which have been slightly amended by virtue of the 22nd Amendment to include a bar against a candidate from serving as President for more than two terms, in violation of the Constitution. The effort of Tribe and his co-authors to argue that such laws do not impose additional qualifications is quite simply unpersuasive. The proposed New Jersey law that Muller references, for example, would bar any Presidential candidate from appearing on the General Election ballot unless they have released tax returns for the five most recent years prior to the election in question. Clearly, this is something beyond a law governing ballot access, such as the requirement that a candidate for office submit a certain number of signatures to qualify for the ballot and is more analogous to the term limits that Missouri sought to impose in Thornton. Because of this, it seems clear that a law requiring a candidate for President to release their tax returns as a price for getting on the ballot would be unconstitutional.
These legal arguments are unlikely to put a stop to the political forces that continue to push for Trump to release his returns, of course, and while the protests and moves at the state level are unlikely to change his mind, we could still be heading for a confrontation over this issue before the 2020 election. Somewhere, these activists are likely to succeed in some state or another. At that point, lawsuits will be filed and the matter will head to the Courts and, eventually, the Supreme Court. Unless the Supreme Court rejects the central argument of Justice Stevens’s majority opinion in Thornton, though, the legal fate of such laws seems clear. In any case, the outcome of the election last November would seem to indicate that, while voters believe candidates for President should release their tax returns, they don’t necessarily base their vote on whether or not that has actually happened. In that case, this weekend’s protests may have largely been in vain.