How to Respond to an IRS Subpoena

How to Respond to an IRS Subpoena

When the Internal Revenue Service (IRS) issues a subpoena, technically called a summons, it’s a sign that an investigation has reached a serious stage. Whether you’re an individual taxpayer, a business owner, or a third party holding financial records, your response can have a significant impact on the outcome.

Understanding IRS Subpoenas

The IRS’s authority to issue subpoenas comes from 26 U.S.C. § 7602, which allows the agency to gather testimony and records relevant to determining a taxpayer’s liability. These subpoenas may arise in civil audits, collection proceedings, or criminal investigations.

Common types include:

• Testimony Summons: Requires an individual to appear before an IRS officer and provide sworn testimony.

• Document Summons: Demands the production of specific records, such as financial statements, correspondence, or electronic data.

• Third-Party Summons: Sent to entities, such as banks, employers, or accountants, who hold information relevant to a taxpayer’s return or financial affairs.

Your Rights When Served with an IRS Subpoena

If you receive an IRS subpoena, it’s important to remember that you are not powerless. Several key rights and protections apply:

• Right to Counsel: You are entitled to have an attorney present during any testimony or production of records. Your attorney can object to improper questions, assert privileges, and ensure that your response is legally appropriate.

• Privilege Protections: Certain communications are protected by the attorney–client privilege or the federally authorized tax practitioner privilege under 26 U.S.C. § 7525. These privileges may prevent disclosure of sensitive information.

• Fifth Amendment Protection: Individuals facing potential criminal exposure may invoke their right against self-incrimination.

• Right to Challenge a Third-Party Summons: Taxpayers generally have 20 days from receiving notice to file a petition to quash a third-party summons under 26 U.S.C. § 7609.

How to Respond: A Step-by-Step Approach

1. Do Not Ignore the Subpoena.
   Failure to respond can lead to enforcement in federal district court, where judges have broad power to compel compliance.

2. Contact Experienced Counsel Immediately.
   A tax attorney can analyze the subpoena’s scope, determine what information must be produced, and identify potential defenses or privileges.

3. Review the Scope and Specificity.
   Determine exactly what documents or testimony are being requested and whether the demand is reasonable, relevant, and properly limited.

4. Preserve All Potentially Relevant Records.
   Destroying or altering documents can lead to obstruction allegations or criminal penalties.

5. Prepare for Testimony with Counsel.
   Your attorney will help you understand the likely questions and advise when to assert privilege or decline to answer.

6. Negotiate with the IRS When Appropriate.
   The IRS often agrees to narrow overly broad requests or accept copies rather than originals.

7. Comply or File a Motion to Quash.
   If there are valid legal grounds, such as privilege, overbreadth, or procedural defects, your attorney can move to quash or limit the subpoena in federal court.

Enforcement and Penalties for Noncompliance

If you fail to comply, the IRS may seek enforcement under 26 U.S.C. § 7604. Courts typically enforce subpoenas unless you can show that:

• The investigation lacks a legitimate purpose;

• The requested information is irrelevant or already in the IRS’s possession; or

• The summons was issued in bad faith or for harassment.

Ignoring an enforced subpoena can lead to contempt sanctions, fines, or even jail time.

Why Representation Matters

An IRS subpoena is more than routine paperwork, it’s a formal demand backed by federal authority. Responding without professional guidance risks over-disclosure, waiver of privilege, or inadvertent self-incrimination.

At Reiter Tax Law, PLLC, we handle these matters with precision. Our firm provides end-to-end representation, from initial review and negotiation with the IRS to motions practice in U.S. District Court if enforcement or quashing becomes necessary. We combine technical tax knowledge with practical experience in federal procedure to protect our clients at every stage.

Contact Reiter Tax Law, PLLC

If you’ve received an IRS subpoena or summons—whether directed to you or a third party—contact Reiter Tax Law, PLLC for a confidential consultation. We help clients respond strategically, assert their rights, and minimize risk in even the most complex tax investigations.