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#48843 - 12/13/02 07:54 PM IRS Inquiry
SteveG Offline
Member
Joined: Jul 2001
Posts: 58
We sometimes get an IRS levy that we respond that the account is closed. Then the IRS follows up with a call wanting to know when, who the signers were and how much was in it when it was closed. Even though they had sent the levy, we feel we can't give this info out with a subpoena. Is that correct? The IRS thinks we are wrong and appears annoyed. Thanks for any feedback.

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#48844 - 12/13/02 08:18 PM Re: IRS Inquiry
SteveG Offline
Member
Joined: Jul 2001
Posts: 58
I meant to say "without" a subpoena. Guess that review my post box is there for a reason.

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#48845 - 12/13/02 08:39 PM Re: IRS Inquiry
Don_Narup Offline

Power Poster
Joined: Jul 2001
Posts: 3,708
Las Vegas Nevada
Depends on what is subpeoned. If its an "Attachment" of a balance, then I would go with what you are doing and just say account closed.

If they are subpeonaing records it a different story. IRS usually includes it all. Best thing to do is read exactly what the subpeona is asking for.
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#48846 - 12/13/02 08:55 PM Re: IRS Inquiry
SteveG Offline
Member
Joined: Jul 2001
Posts: 58
That's the problem ... there is no subpoena. They just want to call and ask for the info about the account we said was closed when we responded to the levy.

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#48847 - 12/13/02 08:58 PM Re: IRS Inquiry
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 80,341
Galveston, TX
Then they need a subpoena. They are probably not use to that because it was a lot easier for banks to cooperate (on the QT) prior to the privacy regulations.
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#48848 - 12/13/02 09:03 PM Re: IRS Inquiry
Don_Narup Offline

Power Poster
Joined: Jul 2001
Posts: 3,708
Las Vegas Nevada
Read the Levy to make sure it does not include a provision to provide this information.

You are not required to tell them anything over the phone like that if you are not served with a request to provide. It their power ego trip in play.

Just tell them you would be happy to respond to a legal documet requesting such information.



I am not an attorney and this is based on my personal experience with the IRS.
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#48849 - 12/13/02 10:32 PM Re: IRS Inquiry
Anonymous
Unregistered

You should not respond. The IRS should use the power available to it to issue a third-party recorkeeper summons under Section 7609(c)(2)(b) of the Internal Revenue Code (a summons in the aid of the collection of the tax liability of the person whose records are sought). These particular summonses are exempt from the notice and challenge procedures usually afforded to customers and the authority for a financial institution to release the information is clear when such a summons is properly used.

Since it is an administrative summons, it is not burdensome on the IRS for you to require them to issue it.


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#48850 - 12/14/02 02:28 AM Re: IRS Inquiry
Anonymous
Unregistered

Oops -- that is me. I hadn't logged on on this computer.

Mary Beth Guard
Bankersonline.com

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#48851 - 12/16/02 03:38 PM Re: IRS Inquiry
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Anonymous, aka Mary Beth, is right, the IRS does have an appropriate form for obtaining this information. However, there is nothing to suggest it is appropriate for them to call you on the phone. Tell them if they follow their own procedures your bank will make every attempt to comply with the law.
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#48852 - 04/10/03 01:51 PM Re: IRS Inquiry
Anonymous
Unregistered

I'm responding to this old post because I have a similar situation. I have received a letter asking for information on one of our depositors. There are no references in the letter to an IRS statute nor does it say anything about this being a Summons. I called the contact number given and spoke with an IRS agent who said that we are not required to respond. I think by responding, we would violate GLB.
oops, just realized I'm not logged in. Thanks for your input on this.

SherryS

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#48853 - 04/10/03 05:19 PM Re: IRS Inquiry
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Your situation is identical to that of the original poster except her query was verbal and yours is in writing. If it is not a summons, then the IRS employee advised you correctly, you are not obligated to respond. I cannot imagine that a bank would want to respond voluntarily.

One of my previous employers simply forwarded the IRS letter to the customer on the assumption that there might be a reason the customer would want to contact the IRS. It was accompanied by a two sentence cover letter saying the query had been received, but it was bank policy not to divulge customer information unless it was compelled or authorized by the customer to do so. This was years before the GLB disclosure, but it would still seem to be a workable response.
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#48854 - 04/10/03 06:39 PM Re: IRS Inquiry
BeachGirl Offline
100 Club
Joined: Sep 2001
Posts: 206
Myrtle Beach, SC
Thanks for the advice. I sent the request back with a cover letter explaining that we could not provide the information due to privacy laws. I also quoted Mary Beth's response regarding their ability to issue a summons. It sort of felt good telling the IRS what to do!!
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