IRS Win In Law Firm Summons Row May Undermine Privilege
Tax attorney Kevin Packman was interviewed in a Law360 article about the U.S. Supreme Court's decision to turn down a law firm's challenge to an IRS summons seeking the identities of clients believed to have possibly used the firm's advice to hide income offshore. The resulting effect could lead to the erosion of attorney-client privilege.
Mr. Packman discusses the difference between Section 7525 privilege and attorney-client privilege, and how the Fifth Circuit's decision didn't seem to distinguish between the two.
"The [Fifth Circuit] accepted it without any indication as to how and why the two privileges are very different … [but the accountant privilege] is nowhere near as broad," he said. "If a client believes going to a lawyer to discuss violations of tax law can be discovered by the IRS, you may indirectly encourage clients not to fix mistakes or play the audit game."