As the Trump administration vows to crack down on leakers, Republicans in Congress want to hand the Justice Department even more power to punish one extremely specific type of leak: unauthorized disclosures of tax records, which in recent years have exposed the creative accounting of the Trump family and wealthy allies like Elon Musk.

A provision tucked near the end of the GOP’s massive budget bill — at page 1,081 of the 1,082-page text circulated late Sunday — would double the maximum prison sentence for leaking tax returns to 10 years and increase possible fines from $5,000 to $250,000 per violation.

Boosting penalties for leakers may seem an odd fit for a budget bill, much like the “nonprofit killer” provision that was recently nixed without explanation. Because of their tenuous relationship to fiscal matters, the provisions potentially aren’t allowed under the rules for Congress’s budget reconciliation process.

Just don’t ask the main proponent of increasing the penalties for tax return leaks, Republican Rep. Jason Smith of Missouri, if these provisions were appropriate to include.

“Wish I could be helpful, but that’s a question for the Senate parliamentarian,” replied Smith’s communications director, J.P. Freire, by email.

Last session, Smith sponsored a stand-alone bill with identical proposed changes to the tax code that passed the House of Representatives last year but failed to advance in the Senate. Smith is one of President Donald Trump’s main surrogates on Capitol Hill for the budget bill and is also chair of the House Ways and Means Committee, which included his proposal about tax record leaks in its section of the budget bill.

Critics wonder whether increasing prison sentences for journalists’ sources is the best use of legislators’ time.

Critics wonder whether increasing prison sentences for journalists’ sources is the best use of legislators’ time as the White House works with House Republicans to push the budget toward the Senate. The proposal would also increase criminal penalties for those who “print or publish in any manner” leaked tax return information, although prosecutors looking to go after journalists and outlets directly would face constitutional hurdles under the Supreme Court’s First Amendment precedent.

“Of course, tax information is highly sensitive and there are legitimate reasons to protect financial privacy,” wrote Seth Stern, director of advocacy for the Freedom of the Press Foundation, in an email. “But there are also times when it’s highly newsworthy — for example, when a president keeps secrets about his finances and business dealings abroad, or when powerful politicians and billionaires evade taxation.”

“There is no need to drastically heighten existing penalties, which, as far as I know, have been largely effective deterrents aside from cases where whistleblowers felt compelled by their consciences to expose impropriety.”

Republicans’ fixation on tax return leaks focuses on one person: Charles Littlejohn, who pleaded guilty in January 2024 to leaking Trump’s tax returns to the New York Times and a cache of tax return data for thousands of wealthy individuals to ProPublica.

In its report advancing Smith’s bill last summer, the Ways and Means Committee made Littlejohn the main character and Trump a pitiful victim. During Littlejohn’s trial, Republican members of the committee wrote to the federal judge to demand that he spend five years in prison, the maximum under the current statute, instead of 10 months as recommended by the federal sentencing guidelines.

Judge Ana Reyes, a Biden nominee, did as Republicans suggested and sentenced Littlejohn to the five-year maximum, which he is currently appealing.

But for many Republicans, Littlejohn got off too easy.  

“Given the lack of deterrence created by the law as is, as well as the concern that such an unprecedented data breach could result in such a disproportionate charge and sentence, the Committee felt it was necessary to increase the penalties,” reads the committee report about Smith’s bill.

But 10 years is the kind of prison sentence beyond that given to many people convicted of crimes, like possessing child sexual abuse material and certain firearms offenses, said Christopher A. Wellborn, president of the National Association of Criminal Defense Lawyers.

“Do we really need to have imprisonment for up to 10 years on something like this?” Wellborn asked.

“Lawmakers and judges should focus on stopping tax evasion by the rich and powerful.”

During his sentencing, Littlejohn’s attorneys argued that he leaked the tax return data “out of a deep, moral belief that the American people had a right to know the information and sharing it was the only way to effect change.” But just like the Espionage Act, the tax code’s leak provisions have no public interest defense.

“Leakers’ motives, and whether their disclosures serve the public good, should at least be a mitigating factor,” Stern said. “Whistleblowers should not be treated the same as malicious actors. Lawmakers and judges should focus on stopping tax evasion by the rich and powerful, not on disproportionate punishments for whistleblowers who expose how existing law is failing Americans.” 

The proposals to stiffen penalties for tax return leakers are part of Republicans’ budget bill, which is currently advancing through the reconciliation mechanism. Under the so-called “Byrd rule,” named for the late Sen. Robert Byrd of West Virginia, matters that are “extraneous” to the budget and fiscal matters cannot be enacted via reconciliation.

Earlier this month, the leaker provision was scored as having “negligible” impact on revenue by the Joint Committee on Taxation.

“That will hurt Republicans’ arguments” under the Byrd rule, predicted Bobby Kogan, senior director for federal budget policy at the Center for American Progress, who has studied reconciliation and the Byrd rule, which is applied by the Senate’s parliamentarian.  

In 2021, for example, the parliamentarian nixed Democrats’ attempt to increase the federal minimum wage in a reconciliation bill, ruling that any impact of the change on the federal budget was “merely incidental” to the underlying policy intent, which violates the Byrd rule.

All of the Republican budget bill’s proposals regarding tax leaks — to increase the maximum sentence, increase the maximum fine, and a third proposal that “clarifies” that each leak is a separate violation for each taxpayer whose information is disclosed — are likely “Byrdable,” according to Kogan, especially the increase in prison sentence.

“Slapping on a jail sentence is about punishment for offenses, not about changing dollars and cents coming in or out of the government,” Kogan wrote. “Of the three parts, I feel that this is least defensible under Byrd.”

“But if I were the Parliamentarian and doing my best to advise based on precedent, I would nix all three of these.”

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