The administrative summons is a legal tool that has historically been used by IRS revenue officers and agents only in extreme cases. It used to be that when a taxpayer came to me with a summons, I could be fairly certain that they had ignored multiple requests and/or missed multiple deadlines for production of documents. But things may be changing.
If a taxpayer misses an IRS deadline, he/she can expect the IRS to activate various collection tools like a wage garnishment or bank levy. But if a taxpayer does not comply with a summons, and the IRS decides to enforce it, then the Justice Department becomes involved in the matter, and he/she could actually face contempt charges.
According to a recent Reuters article, IRS management is encouraging its collections force to use the summons more liberally. Taxpayers can fight a summons, and statistics show that disputes involving summonses are definitely on the rise. There were 44 summons-related disputes in 2005 compared to 132 in 2011. It is the most commonly litigated issue last year. However, statistics also show that the IRS normally wins.
In order to prevail in a summons dispute, the taxpayer must prove that the information requested by the Service is not relevant, or that the Service did not follow procedure in issuance of the summons. 90 percent of the time, the taxpayer cannot meet this burden of proof.