Marc: I am going to leave here the response from Marc Enzi, EA, CFP, call us if you have further questions or want to discuss this matter into detail with him, regardless, I hope to meet you next week!
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Marc,
What you have received is referred to by IRS as a 3rd party contact. I think IRS uses the term to frighten Taxpayers. If IRS really wants the documents, they can issue a summons which is similar to a subpoena. If you did not receive a summons, you can safely ignore the IRS request. That is all the IRS letter is, a request, not an order and it carries no legal weight except, absent a summons, you may be violating some privacy rules. You are also under no obligation to keep this from your client.
This is either an examination, or a collection case, if it was criminal, I suspect IRS would have gone for the summons.
Not responding is the easiest approach; there is no advantage to poking the bear which may prompt an escalation. Simply not responding brings no legal peril. Also, if you don't respond, the examiner can't then open an exam on you, staff or the company in retaliation. It does not work that way.
If you do get a summons, you'll know it. Give that to your legal counsel and inform your client, their legal counsel may be able to quash the summons.
Want to know more? Here is a link to great article on the IRS summons https://www.cpapracticeadvisor.com/2019/10/04/what-is-an-irs-summons-and-how-to-respond/35068/
Kind regards,
Marc Enzi EA, CFP®
1855 Barker Cypress Road
Suite 120
Houston, TX, 77084 USA
Ofc 001-281-578-1040
Fax 001-832-201-9121
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Mary Enzi CAA
Tax Solutions – FIRPTA Consulting
[email protected]
+1 (281) 578-1040
Barker TX
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Original Message:
Sent: 09-29-2023 17:21
From: Mary Enzi
Subject: IRS Letter
Marc:
Please give us a call, this is exactly the kind of work we do all day everyday, we will be more than happy to assist you,
We do mainly FIRPTA, but IRS controversy and tax representation is also one of the areas of our expertise, I have the best Enrolled Agent in the office and he can talk to you about this issue. Please call our office 281 578-1040
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Mary Enzi CAA
Tax Solutions – FIRPTA Consulting
[email protected]
+1 (281) 578-1040
Barker TX
Original Message:
Sent: 09-29-2023 14:12
From: Marc Warncke
Subject: IRS Letter
Fellow Title Professionals:
Our Title Agency received a very strange letter from the IRS asking us to "assist in a pending federal tax matter" by disclosing information about an individual involved in a recent closing. It is a "letter", not a subpoena or court order.
Specifically, they are asking us to provide copies of closing statements, checks, 1099s, closing fees and other information relating to one of the two sellers involved in a closing we conducted back in 2022. The letter includes a disclosure that they are required to notify that individual that they are requesting information from us and asking us whether we are concerned about that physical , economic, or emotional reprisals from that person or anyone else if we are disclosed as an information source.
Has anyone ever gotten such a letter? What is our obligation to respond? Unless the IRS has some kind of special investigatory powers I am not aware of, I do not think I can just fork over this kind of confidential information upon demand, without a consent from the affected person.
Curious if anyone has run into this before, and how you handled it.
Marc F. Warncke, Esq.
Clemens, Korhn, Liming & Warncke, Ltd.
PO Box 787
419 Fifth St. Suite 2000
Defiance, Ohio, 43512
Ph (419)782-6055
Mobile: (419) 438-1110