In a letter published today, Representative David Camp, Chairman of the House Ways & Means Committee, and Senator Orrin Hatch, ranking member of the Senate Finance Committee, have told New York’s Attorney General that they are “particularly concerned by reports that indicate your office has not followed the federally prescribed process for legally obtaining tax returns and other financial information” from social welfare organizations and private equity firms. Mr. Schneiderman’s inquiry had come amidst the backdrop of a surge in political spending by 501(c)(4)s (which are not required to disclose their donors), along with calls to increase regulation of these groups, as well as suggestions that private equity firms may have not paid sufficient state taxes.
The letter signed by the two Republicans points to a federal statute that allows for state officials to obtain tax return information by filing a written request with the IRS and also notes that government officials who receive such information from the IRS “are required to maintain safeguards to protect the information from unauthorized disclosure.” The letter urges the NY AG’s office to “cease its efforts” and direct its inquiries instead to the IRS.