District court holds that tax accrual workpapers are privileged documents.
The Tax Adviser › Vol. 38 Nbr. 12, December 2007
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District court holds that tax accrual workpapers are privileged documents.
A district court in the First Circuit held that a corporation did not have to turn over tax accrual workpapers to the IRS because the work-product privilege applied to the workpapers. The court also found that the attorney-client and tax-practitioner privileges could have applied to the workpapers, but the corporation had waived these privileges by sharing the workpapers with its independent auditors.
Background Textron, Inc. (Textron) is a publicly traded conglomerate with approximately 190 subsidiaries. Like other large corporations, Textron's federal tax returns are audited periodically. During the audits, the Service examines the returns for the tax years that are part of the audit cycle. In seven of its past eight audit...See the full content of this document
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