Can My Accountant Release My Tax Returns?

Tax Returns
By Christopher Coble, Esq. on April 15, 2019 1:05 PM

Today is Tax Day. So hopefully, you've already filed your taxes. Or, if you hired a CPA or accounting firm to do your taxes, they've got plans to file them by the end of the day.

You might also be wondering, given the news cycle, whether your tax returns are public documents. The subject of President Donald Trump's tax returns has been percolating for years in the media, but the rhetoric has ramped up in recent weeks, as the House Ways and Means Committee first requested the past six years' worth of Trump's tax filings from the IRS, then, after the agency failed to comply, gave IRS Commissioner Chuck Rettig on April 23 deadline on turning over the documents. The House Oversight and Reform Committee also allegedly threatened to subpoena Trump's accounting firm, Mazars USA, to get the tax returns.

In response, Trump's attorneys counter-threatened Mazars, warning the accountants not to release the tax filings lest they face a potential lawsuit. So, what's the story with tax returns? Are they public information? And can your CPA just release them to anybody?

Are Taxes Public or Private Documents?

As a general matter, your tax returns aren't automatically public documents just because they are filed with the IRS. While you have access to your previous filings and IRS records, the public doesn't have the same access to others'. And although all IRS records are subject to Freedom of Information Act requests, the IRS is not required to release all documents subject to FOIA requests based on several exemptions and exclusions.

For instance, the IRS can decline to disclose tax information based on national security, trade secret, or law enforcement interests. There is also an exemption based on personal privacy that allows the IRS "to withhold personal data kept in its files where there is an expectation of privacy," which applies to most everyone's personal tax returns.

Politics as Usual?

A public official's tax returns have always been the subject of political debate, and most presidents (and even presidential candidates) have been willing to release their tax returns voluntarily. That means there is no law requiring release, although that is what some congressional committees are considering. That also means that release of tax returns could come down to confidentiality issues.

The AICPA Code of Professional Conduct requires CPAs to get consent before disclosing confidential client information, unless they are asked to comply with a validly issued and enforceable subpoena. Tax attorneys, on the other hand, offer an added layer of security as any information you provide your tax attorney is usually protected by client-attorney privilege. That could end up handy if, say, your tax returns become part of a criminal investigation.

That's just one reason to hire a tax attorney instead of a CPA, or to talk to an attorney if your accountant releases your tax information without consent.

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