Home      Login

Abstract: 

For years, taxpayers, the IRS, and the courts have struggled with the question of how to assure that business taxpayers have robust and unfettered access to advice from counsel while not compromising the right of investors to understand the decisions made or the effectiveness of tax compliance investigations. This issue affects banks and financial institutions in particular, because of the exposure banks can have to client tax planning strategies and the relatively high degree of uncertainty surrounding the taxation of financing transactions. This article reviews the policy issues involved, recent case law addressing the IRS’s right to access tax work product, FIN 48, and how these all relate to the Service’s new Uncertain Tax Position (UTP) initiative—and then suggests practical steps counsel can take to preserve the confidentiality of tax advice.

Keywords:  right to counsel; work-product doctrine; FIN 48; tax accrual work papers; dual purpose documents; United States v. Textron; United States v. El Paso; United States v. Arthur Young & Co.; Rockwell International v. United States; Regions Financial cor

Affiliations:  1: Dykema.