Attorney-Client Privilege in Tax Controversy and Transactions

Protecting Confidentiality in IRS Summonses, Tax Accrual Work Papers, FIN 48 Disclosures, and Litigation

Recording of a 90-minute premium CLE/CPE webinar with Q&A

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Conducted on Thursday, April 30, 2009

Course Materials

This seminar will examine the attorney-client privilege and exceptions uniquely applicable to tax counsel. The panel will discuss key court cases and offer their experienced perspectives on preserving the privilege and maintaining the confidentiality when providing tax advice.

Description

Many courts have concluded that attorney-client privilege applies when attorneys provide tax advice to clients. Congressional support is demonstrated by Internal Revenue Service Code Section 7525. However, there is considerable confusion regarding when and the extent to which the privilege applies.

Tax counsel face unique privilege issues in the context of tax accrual work papers, IRS summonses, FIN 48 disclosures, and tax controversies, such as IRS protests and litigation. Understanding the nuances of the privilege in such situations is critical in shielding confidential client information.

The First Circuit's Textron ruling, though recently vacated with a rehearing in June 2009, provides useful guidance to analyze the protection of tax accrual work papers in IRS disputes. Regardless of the outcome, there are steps taxpayers should consider to avail themselves of the privilege.

Listen as our authoritative panel of tax attorneys examines the attorney-client privilege and its exceptions. The panel will offer their best practices for preserving the privilege and maintaining the confidentiality when providing tax advice.

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Outline

  1. Attorney–client privilege and limitations under IRC §7525
    1. Tax advice defined
    2. To what does the privilege apply?
    3. What is not privileged material?
    4. Exceptions — do they swallow the privilege?
    5. Work product doctrine
    6. Impact of FRE Rule 502
  2. Apply attorney-client privilege in the tax context
    1. Tax accrual work papers
    2. IRS summonses
    3. FIN 48
    4. Litigation
  3. Waiver
    1. Scope
    2. Type
    3. To governmental agencies
  4. Best practices for preserving the privilege

Benefits

The panel will review these and other key questions:

  • Under what circumstances does the attorney-client privilege apply in the context of tax advice?
  • What are the unique privilege issues that arise for attorneys in the context of FIN 48-related counsel to clients?
  • How have the courts treated privilege with regard to tax accrual work papers?
  • What steps can tax counsel take to preserve the privilege and maintain confidentiality?

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.

Faculty

Norma J. Schrock
Norma J. Schrock
Executive Director, Tax Quality and Risk Management Group
Ernst & Young

She specializes in federal tax procedure and consults on the application of federal tax procedures to specific factual...  |  Read More

Kenneth B. Clark
Kenneth B. Clark
Partner
Fenwick & West

His principal focus is complex federal tax litigation and tax controversy work. He has managed a variety of complex...  |  Read More

Edward L. Froelich
Edward L. Froelich
Of Counsel
Morrison & Foerster

He has represented corporations, partnerships, and individuals in the administrative and litigation stages of a federal...  |  Read More

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