IRS Law Blog

What is FOIA?

A Freedom of Information Act (FOIA) is a practical, and often overlooked, tool available when dealing with the IRS. Enacted in the 1960s to promote government transparency, the act gives individuals the right to request records from federal agencies, including the Department of the Treasury.

Through FOIA, we can request the full IRS administrative file, which typically includes:

• Case management notes.
• Auditor work papers.
• Internal correspondence.
• Copies of notices and letters sent to you.

Federal agencies must disclose requested records unless a specific exemption applies. However, these exemptions are relatively rare. The purpose of FOIA is designed to make government actions more transparent, not to withhold information.

How can FOIA Request Help my Tax Case?

There are a few different ways a FOIA request can help us resolve your tax cases. Specifically, I routinely use FOIA requests in Audit reconsideration, Collection Due Process Hearings, and while litigating in Federal Court as well as Tax Court.

Audit Support

Many clients come to me in panic after an audit as they no longer have their audit records. I have also seen cases where an audit occurred so long ago that they simply do not have the records anymore. A FOIA request allows us to retrieve the full audit file, showing:

• What documents you previously provided.
• What the auditor reviewed.
• Notes and work papers explaining the IRS’s conclusions.

This information is very helpful when preparing for Tax Court, seeking audit reconsideration, or identifying mistakes that occurred during the audit as it shows us everything that the auditor relied upon. It can reveal mistakes as simple as the auditor improperly disallowed deductions, or can be a little more complex such as contradictions within the IRS’s own notes.

FOIA is also helpful in cases involving a Substitute for Return (SFR). A SFR is where the IRS files a return on your behalf. SFRs will not include your deductions and stock basis information, and many are generated by automated systems without a live agent meaning their is a higher chance you may have missed your response deadlines, or worse case, did not receive any notice. With the FOIA file, we can see exactly what the IRS relied on for the SFR and respond appropriately.

Obtaining Your IRS Account Records

FOIA can also help us obtain your IRS account transcripts. The IRS transcripts verify where you stand in the collection process.

For example, the transcript will verify whether a Final Notice of Intent to Levy has been issued or if you have unfiled returns. A FOIA can also provide Wage and Income transcripts showing what income was reported to the IRS for preparing any missing returns.

FOIA in Litigation and Tax Court

In litigation, FOIA gives us access to Field Agents’ notes and internal correspondence. This information will reveal how the IRS handled your case and whether any procedural errors occurred. For litigation in Federal Court, this is a helpful tool during discovery to obtain records that may not have been disclosed. I have also used them in summary judgment motions to help build up an argument.

FOIA is also particularly valuable in Tax Court as it relates to appealing Collection Due Process (CDP) cases. Tax Court reviews CDP appeals under an “abuse of discretion” standard, meaning the judge evaluates whether the Settlement Officer acted reasonably and followed proper procedures. FOIA allows us to identify administrative errors, missing documentation, or inconsistencies. For example, I have had agents claim they never received our correspondence or requests to settle a case. However, by using a FOIA request, we were able to prove that their own records contradicted their assertion, our records verified that we had made good faith efforts to settle the case. The case was ultimately remanded because of the discrepancy.