United States v. KPMG

Beckett G. Cantley, United States v. KPMG: Does Section 6103 Allow the IRS to Put Taxpayer Names on the Front Page of the Wall Street Journal?, 50 Clev. St. L. Rev. 1 (2002-2003).

Summary.  This article discussed whether the IRS violated Section 6103 of the Internal Revenue Code (“IRC”) when it disclosed the names of several prominent taxpayers in a public lawsuit involving KPMG, a “Big Four” CPA firm.  The disclosure lead to a Wall Street Journal article titled “IRS Releases Names of People in Disputed KPMG Tax Shelters”.  Section 6103(a) sets forth the general rule that taxpayer “return information” is generally confidential, subject to certain limited exceptions.  Section 6103(b)(2) provides that “return information” includes taxpayer names as well as other information.  The article concluded that it is likely that the United States (“US”) violated the general rule of Section 6103 because the US improperly disclosed taxpayer names in the KPMG case.  However, the article further concluded that it is unlikely that the named taxpayers would recover damages because the US is likely to meet the exception where the disclosing party has a good faith, but erroneous, interpretation of Section 6103.