Tax lawyer: Attorney-client privilege can't be obstructed by IRS investigation
According to Robert W. Wood, tax lawyer and columnist for Forbes, the attorney-client privilege can come in handy when dealing with the IRS.
According to Robert W. Wood, tax lawyer and columnist for Forbes, the attorney-client privilege can come in handy when dealing with the IRS.
The IRS has recently cracked down on U.S. businesses and tax payers for failing to claim assets in foreign bank accounts. Many victims of this crackdown are claiming ignorance.
But according to Wood, those with foreign accounts can better serve themselves by retaining a tax lawyer to hold onto their documentation.
"Thanks to attorney-client privilege, if you confess to a lawyer you’re hiding income or assets offshore the IRS can’t make the lawyer talk," Wood wrote in a column. "The IRS can’t even make your lawyer produce your documents with a summons or subpoena."
Exercising caution in this area might be wise given the recent news of Michael Schiavo, a Boston bank director charged by the U.S. Department of Justice and IRS for allegedly hiding foreign assets. He faces up to five years in prison.
According to Wood, the IRS is stunted by the attorney-client privilege but has full access to documents that are not in the tax lawyer's possession.
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