OK for ex-spouse to get corporate return info.

Author:Lynch, Michael
Position:Closely held corporations

A couple that owned a closely held corporation filed a joint tax return in 1992. In 1995 the IRS began investigating the couple's 1992 personal tax return and the corporate return. The couple divorced in 1996, and the husband became sole owner of the corporation. In 1997 an IRS agent disclosed tax information about the corporation to the ex-wife. She then used the information to her advantage in negotiating a favorable property settlement. The husband and the corporation brought suit against the IRS for improper disclosure of tax information, seeking punitive and compensatory damages and attorneys' fees and costs.

The district court found that IRC section 6103(h)(4) permits the...

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