Question

Law case analysis

Ernie prepared a federal income tax return for Bert. In the courses of preparing the return, Ernie had several conferences with Bert and made notes. In addition, Bert furnished Ernie with a number of documents concerning transactions in which Bert had been involved. The IRS ultimately brought suit against Bert, claiming that he had underpaid his actual tax liability by a substantial amount. The IRS arranged for a subpoena to be served on Ernie, subpoena purported to require him to produce, in court, Bert’s documents and the notes he had made during conversations with Bert. Ernie sought to resist the order on the basis that the conversations were held in confidence the purpose of preparing Bert’s tax return, and that the notes were made documents were delivered in further the sam purpose. Ernie claimed, therefore, that what the IRS sought was privileged information and that since the nor Bert had waived the privilege, he should not have to produce what the IRS sought. Is Ernie’s argument sought? Why or why not?

Answer 1

Yes ernie's claim is lawfull andan his argument should be sought.

Here ernie is a federally authorized tax practitioner acted on behalf and filed returns for bert. so the communications between Bert and ernie should be considered a privileged communication.

under the Internal Revenue Code section 7525(a)(1) rule says that , With respect to tax advice, the same common law protections of confidentiality which apply to a communication between a taxpayer and an attorney shall also apply to a communication between a taxpayer and any federally authorized tax practitioner to the extent the communication would be considered a privileged communication if it were between a taxpayer and an attorney.

So as per the provisions of this rule Ernie's claim is completely lawful and he should not have to produce what the IRS sought.