IRS Summons (Form 2039) – Understanding Why the IRS issues a Summons
An IRS Summon is not the same as a court summons.
And, while the direct impact of you non-complying with the IRS Summons is not as bad as it would be if it was a court summons (or if the court holds you in contempt), the indirect impact can far-reaching consequences – especially when you have undisclosed income, accounts, assets, and/or investments and want to submit to voluntary disclosure/amnesty.
IRS Summons (Form 2039)
An IRS Summons is a form used by the IRS, when the IRS wants to step up the “tone” of a document or personal appearance request from you.
Initially, before you receive an IRS Summons, you will usually have received one or more IDRs (Information Documents Requests).
The IDR is a formal request (but less formal than form 2039) for documents. Unlike the IDR, the Summons is a more formal request to appear and/.or bring/produce documents for the IRS to review.
How is a Form 2039 IRS Summons Issued?
Typically, the Summons will be issued in one (1) of three (3) different ways, with server “certifying” as follows:
– I certify that I handed a copy of the summons, which contained the attestation required by § 7603, to the person to whom it was directed.
– I certify that I left a copy of the summons, which contained the attestation required by Summons § 7603, at the last and usual place of abode of the person to whom it was directed. I left the copy with the following person (if any):
I- certify that I sent a copy of the summons, which contained the attestation required by § 7603, by certified or registered mail to the last known address of the person to whom it was directed, that person being a third-party recordkeeper within the meaning of § 7603(b).
What is the Authority to Examine Books and Witnesses?
As provided by the IRS (summarized):
(a) Authority to Summon, etc. – For the purpose of ascertaining the correctness of any return, making a return where none has been made, determining the liability of any person for any internal revenue tax or the liability at law or in equity of any transferee or fiduciary of any person in respect of any internal revenue tax, or collecting any such liability, the Secretary (b) Service by mail to third-party recordkeepers. – (1) In general. – A summons referred to in subsection (a) for the production of books, papers, records, or other data by a third-party recordkeeper may also be served by certified or registered mail to the last known address of such is authorized –
– To examine any books, papers, records, or other data which may be relevant or recordkeeper material to such inquiry. (2) Third party record keeper. – For purposes of paragraph (1), the term third-party.
– To summon the person liable for tax or required to perform the act, or any officer or employee of such person, or any person having possession, custody, or care of books of account containing entries relating to the business of the person liable for tax or required to perform the act, or any other person the Secretary may deem proper, to appear before the Secretary at a time and place named in the summons and to produce such books, papers, records, or other data, and to give such testimony, under oath, as may be relevant or material to such inquiry; and (3) To take such testimony of the person concerned, under oath, as may be relevant or material to such inquiry.
(b) Purpose may include inquiry into offense. – The purposes for which the Secretary may take any action described in paragraph (1), (2), or (3) of subsection (a) include the purpose of inquiring into any offense connected with the administration or enforcement of the internal revenue laws.
Relevant Sections of an IRS Summons Notice
Notice of Contact of Third Parties
(1) General Notice. – An officer or employee of the Internal Revenue Service may not contact any person other than the taxpayer with respect to the determination or collection of the tax liability of such taxpayer without providing reasonable notice in advance to the taxpayer that contacts with persons other than the taxpayer may be made.
(2) Notice of specific contacts. – The Secretary shall periodically provide to a taxpayer a record of persons contacted during such period by the Secretary with respect to the determination or collection of the tax liability of such taxpayer. Such record shall also be provided upon request of the taxpayer.
(3) Exceptions. – This subsection shall not apply- (A) to any contact which the taxpayer has authorized, (B) if the Secretary determines for good cause shown that such notice would jeopardize collection of any tax or such notice may involve reprisal against any person, or (C) with respect to any pending criminal investigation.
Sec. 7603. Service of Summons
(a) In general – A summons issued under section 6420(e)(2), 6421 (g)(2), 6427(j)(2), or 7602 shall be served by the Secretary, by an attested copy delivered in hand to the person to whom it is directed, or left at his last and usual place of abode; and the certificate of service signed by the person serving the summons shall be evidence of the facts it states on the hearing of an application for the enforcement of the summons. When the summons requires the production of books, papers, records, or other data, it shall be sufficient if such books, papers, records, or other data are described with reasonable certainty
Sec. 7604. Enforcement of Summons
Enforcement of summons (a) Jurisdiction of Distinct Court. – If any person is summoned under the internal revenue laws to appear, to testify, or to produce books, papers, records, or other data, the United States distinct court for the district in which such person resides or is found shall have jurisdiction by appropriate process to compel such attendance, testimony, or production of books, papers, records, or other data.
(b) Enforcement. – Whenever any person summoned under section 6420(e)(2), 6421 (g)(2), 6427(j)(2), or 7602 neglects or refuses to obey such summons, or to produce books, papers, records, or other data, or to give testimony, as required, the Secretary may apply to the judge of the district court or to a United States Commissioner’ for the district within which the person so summoned resides or is found for an attachment against him as for a contempt, it shall be the duty of the judge or commissioner’ to hear the application, and, if satisfactory proof is made, to issue an attachment, directed to some proper officer, for the arrest of such person, and upon his being brought before him to proceed to a hearing of the case; and upon such hearing the judge or the United States Commissioner’ shall have power to make such order as he shall deem proper, not inconsistent with the law for the punishment of contempts, to enforce obedience to the requirements of the summons and to punish such person for his default or disobedience.
Sec. 7605 Time and Place of Examination
Time and place of examination (a) Time and place. – The time and place of examination pursuant to the provisions of section 6420(e)(2), 6421 (g)(2), 6427(j)(2), or 7602 shall be such time and place as may be fixed by the Secretary and as are reasonable under the circumstances. In the case of a summons under authority of paragraph (2) of section 7602, or under the corresponding authority of section 6420(e)(2), 6421 (g)(2) or 6427(j)(2), the date fixed for appearance before the Secretary shall not be less than 10 days from the date of the summons.
Sec. 7210. Failure to Obey Summons
Failure to obey summons Any person who, being duly summoned to appear to testify, or to appear and produce books, accounts, records, memoranda or other papers, as required under sections 6420(e)(2), 6421(g)(2), 6427(j)(2), 7602, 7603, and 7604(b), neglects to appear or to produce such books, accounts, records memoranda, or other papers, shall, upon conviction thereof, be fined not more than $1,000, or imprisoned not more than 1 year, or both, together with costs of prosecution
John Doe Summons vs. Direct Summons
Generally, when a person receives a “John Doe” Summons, it will not directly prevent them from submitting to the IRS Offshore Disclosure Programs. It may hinder a person’s ability to do so, but does not outright prevent it. It is important to note that pursuant to IRS Procedures, the IRS can only issues the John Doe summons with approval from Federal Court. (So if you receive one, you need to speak with counsel to assess the situation and not make any representations to the IRS until you have spoken with counsel.
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Sean holds a Master's in Tax Law from one of the top Tax LL.M. programs in the country at the University of Denver. He has also earned the prestigious IRS Enrolled Agent credential. Mr. Golding's articles have been referenced in such publications as the Washington Post, Forbes, Nolo, and various Law Journals nationwide.
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