Supreme Court Agrees To Hear IRS Case About Probing Bank Records

Supreme Court Agrees To Hear IRS Case About Probing Bank Records

( – Does the Internal Revenue Service abuse its powers in the pursuit of money? That question is about to be tested by America’s top judges. The case could impact the Biden administration’s plans to massively expand IRS manpower.

In 2018, the IRS was trying to collect around $2 million in unpaid taxes owed by hotelier Remo Polselli. That year, Polselli had paid around $290,000 of the outstanding bill — but he didn’t make the payment from his own bank account. Instead, the money came from his business, Dolce Hotel Management LLC. IRS agent Michael Bryant suspected Polselli was hiding money from the government, so he decided to investigate. Instead of pulling Polselli’s financial records, though, he started probing people around him.

In 2020, Polselli’s wife, Hanna, and two law firms that have worked for him sued the IRS for pulling their records without notifying them. Their lawsuit argues that thanks to a 2000 ruling by the 9th Circuit Court, the IRS is only allowed to do that when the person they’re investigating has a legal interest in the records they access. However, earlier this year, the 6th Circuit Court ruled the opposite way and decided Bryant was justified in investigating Mrs. Polselli and the law firms. The Center for Taxpayer Rights, which had filed a brief supporting the lawsuit, argues that this leaves “virtually no limits” on the IRS’ ability to raid financial records and denies taxpayers the ability to keep their records confidential.

The US Supreme Court has now agreed to hear the case, although it hasn’t explained its reasons. Its decision will resolve the conflict between the two circuit court rulings — and it could also make Republican lawmakers even more determined to axe the administration’s funding for an extra 87,000 IRS agents.

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