What a summons can reach
The IRS issues summonses during audits and collection matters to obtain testimony and records from taxpayers and from third parties such as banks, employers, and accountants. A summons is issued by the IRS itself, not by a judge, and if the person summoned does not comply, the IRS has to go to federal district court to enforce it. In an enforcement proceeding, the government generally starts by showing that the summons serves a legitimate purpose and seeks information that may be relevant, and the person resisting it then bears a heavy burden. Once a matter has been referred to the Justice Department for criminal prosecution, the IRS generally can no longer use a summons for that taxpayer. A summons to an accountant can reach many of the accountant's records, because communications with an accountant are frequently not privileged.
Third-party summonses and the notice to you
When the IRS summons records about you from someone else, it is generally required to notify you, and you have a short period to petition a federal court to quash the summons. The grounds for quashing are narrower than people expect, and courts look skeptically at petitions brought mainly for delay. Even so, the notice can show how far an examination or investigation has gone, and who has been asked tells you something about what the IRS is examining. Filing a petition can also suspend the time the IRS has to assess or collect tax, which is a trade-off to weigh. Objections belong in the court process; asking the bank or other recipient to hold back records is not the way to raise them.
Responding to a summons served on you
If the summons is addressed to you, read exactly what it asks for and when, because its scope sometimes reaches further than the examiner's earlier requests. Gather the documents described and keep a copy of everything produced. Some testimony and some records can raise Fifth Amendment questions, particularly if there is any chance the matter is criminal, and those questions have to be raised carefully and specifically rather than as a blanket refusal. We review the summons, the stage of the case, and what the IRS likely already has, then discuss whether to comply, narrow the request by agreement, or object. A lawyer can usually attend the appearance with you, and the date can often be moved by arrangement.
