Receiving mail from the Internal Revenue Service can be distressing for many taxpayers, especially when it asks them to send back bank records and other financial information. The IRS often sends summonses in audit fraud cases, which can be particularly concerning due to the potentially severe consequences that come from ignoring it. The first thing Texas residents who receive an IRS summons should do is contact a qualified attorney for advice.
When requesting data from taxpayers, the IRS typically sends out an Information Document Request. Individuals who receive this are not legally required to respond to this request, but failing to answer could cause the IRS to send a summons, which can result in more serious effects.
An IRS summons often represents the agency’s willingness to go to court. Taxpayers may still ignore a summons, but the IRS can then go through the Department of Justice to secure a court order enforcing it. Ignoring a summons at this stage could cause one to be held in civil or criminal contempt of court. Receiving a summons should indicate that the IRS is serious about going to court and that simply ignoring its request for information is likely to have negative consequences.
In some cases, one may be able to show legitimate reasons why one should not disclose the information requested by a summons. Commonly cited grounds include work product protection and attorney-client privilege. However, successfully defending against a summons using such grounds can be difficult, as the IRS is taking increasingly more cases to court. According to the U.S. Taxpayer Advocate Service, the IRS took 132 summons cases to court in 2011, compared to just 44 in 2005. The IRS won more than 90 percent of these disputes.
Source: Forbes, “What To Do If You Get An IRS Summons,” Robert W. Wood, Sep. 10, 2012