Published on

The U.S. Supreme Court has granted the IRS the authority to access bank records without notifying the taxpayer or their associates or joint holders. In Polselli v. IRS the Supreme Court’s unanimous decision affirmed the IRS’s power to secretly probe financial records.

This ruling means that the IRS can investigate a taxpayer’s financial records, including those of their relatives or associates, without prior notice. Even if the targeted financial records belong to individuals who do not owe unpaid taxes, the IRS can still request access under an existing statute.

The Polselli case arose when Remo Polselli, a taxpayer owing over $2 million in taxes, had summonses issued to various banks. Notably, the IRS did not inform Polselli’s wife or his law firm about its attempts to obtain their banking information. The IRS has the authority to issue summonses to gather information that can assist in tax collection efforts without the requirement of prior notice.

The Supreme Court’s ruling aligned with the plain language of the statute, which does not mandate notice when the IRS engages in collection activities related to tax assessments or judgments against a taxpayer. Although there are instances where the IRS is obligated to provide notice, this case specifically addressed the collection of tax debt, separate from investigations.

While the ruling raises important questions about privacy and notice, it also highlights practical considerations for individuals facing tax debts. It is generally advisable to pay taxes owed to the IRS on time or as soon as possible, given their extensive collection resources. However, if you are unable to pay, the IRS offers options such as payment plans and other Fresh Start programs in you qualify such as Offer in Compromise or Currently Not Collectible.

The Supreme Court’s decision grants the IRS the authority to access bank records secretly, even of individuals not directly responsible for tax debts. It is essential for taxpayers to be aware of their obligations and explore available options for payment if they find themselves owing taxes. If you owe back taxes and can’t pay them in full, contact the Tomes Law Firm Tax Team today for a free confidential strategy session to get you on track. Don’t wait until it is too late. The longer you wait the less options you have. Call us today at 732-333-0681