If the IRS, as part of a tax audit or examination, wants something from the taxpayer, they tend to ask nicely only once.
Sometimes it is difficult to hand over the books and every last financial detail to the IRS. It can be somewhat like letting a stranger into your bedroom; even if you have nothing to hide, you don’t want them there. Also, document requests can be quite burdensome. Some items cannot be retrieved or compiled without expending inordinate amounts of time and money. Lastly, the information sought by the IRS can sometimes appear to bear very little relevance to the issue(s) at hand. But however difficult it may be to comply with a document request, or however ridiculous the request may seem, the IRS usually gets what it wants.
What if the taxpayer doesn’t comply to that initial polite request? Maybe the IRS asks again with some emphasis, stronger words, or even a threat of summons. Normally the IRS resorts to a summons only after the taxpayer has ignored a couple informal requests or after the taxpayer has openly refused to provide the information sought by the IRS. When a taxpayer ignores a summons, the procedure is for the IRS to go to the Justice Department and request a court order to enforce the summons. And courts have routinely rubber-stamped such requests. A court-ordered summons is very serious and cannot be ignored without risk of civil or criminal contempt.
This week the US Supreme Court will decide whether or not a taxpayer should be granted an evidentiary hearing in which a judge would determine if a summons is proper and not simply intended to harass the taxpayer, over-complicate the issues, or delay the process. This is a big case as it relates taxpayer rights. The IRS should not be able to ask for anything and everything under the sun with no explanation as to its purpose and no procedural mechanism for the taxpayer to dispute it.
