Tax Law | Expert Legal Commentary
September 8, 2009
U.S. v. Textron: IRS Is Entitled to Tax Accrual Work Papers
U.S. v. Textron Inc.
By
H. Jacob Lager of Zuber & Taillieu
In a highly controversial split decision, the U.S. Court of Appeals for the First Circuit ruled that the work product privilege does not protect a company’s tax accrual work papers from IRS discovery. In U.S. v. Textron Inc., ____ F.3d ____, 2009 WL 2476475, No. 07-2631 (1st Cir. Aug. 13, 2009), the First Circuit held that the tax accrual work papers are not protected work product because they were prepared to support financial filings and gain auditor approval, rather than for use in possible litigation. American in-house attorneys denounce the opinion, claiming that it eviscerates their ability to work with company auditors to ensure accurate and well-informed financials and accounting disclosures. The decision creates a split among circuits, making the issue ripe for Supreme Court review.
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About the Author
H. Jacob Lager is a Partner of Zuber & Taillieu, focusing on tax law.
Image Credit: ©iStockphoto.com/spxChrome
