IRS's Right to Examine a Taxpayer's E-Mails

A recent advisory issued by the Chief Counsel's Office of the Internal Revenue Service ("IRS") sets forth the IRS's position on the procedures that its agents must follow in order to obtain a taxpayer's e-mails from his or her Internet service provider ("ISP").  

In I.R.S. Chief Counsel Advisory("I.R.S. C.C.A.") 2011-41-017 (July 8, 2011), the IRS interpreted provisions of the Internal Revenue Code relating to examination of a taxpayer's records, the Stored Communications Act ("SCA"), and a decision by the U.S. Court of Appeals for the Sixth Circuit, and concluded that there are certain restrictions on the ability of an IRS agent to issue a summons to a taxpayer's ISP, seeking the contents of a taxpayer's electronic communications. 

The Sixth Circuit, relying on the Fourth Amendment to the U.S. Constitution, recently held that since an Internet "subscriber enjoys a reasonable expectation of privacy in the contents of emails that are stored with, or sent or received through, a commercial ISP,  the government may not compel a commercial ISP to turn over the contents of a subscriber's emails without first obtaining a warrant based on probable cause."United States v. Warshak, 631 F.3d 266, 288 (6th Cir. 2010). 

However, the Chief Counsel also advised that with respect to the "contents" of a taxpayer's e-mails or other electronic communications that are more than 180 days old, there is a "warrantless" administrative summons procedure described in 18 U.S.C. § 2703(c)(2) that can be followed by an IRS agent in order to obtain such communications from the taxpayer's ISP.

Furthermore, the Chief Counsel noted that various federal courts "have recognized that a warrant is not required by the Constitution for a government entity to require an electronic communications provider to produce a customer's non-content information regarding an electronic communication."

The above-described rulings by the IRS provide up-to-date guidance as to the IRS's position on the procedures that an IRS agent must follow in order to review the content of a taxpayer's e-mails or other electronic communications. 

However, it should be noted that under I.R.C. § 6110(j)(3), the Chief Counsel's Advisory "may not be used or cited as precedent."