On January 10th, the Supreme Court agreed to hear the Clarke case from the Eleventh Circuit. The case raises an important procedural issue. When taxpayers do not respond to an IRS administrative summons, the government can ask a court to order the taxpayer to comply. The defendants in the Clarke case argued that the summonses were issued for an improper purpose and therefore should not be enforced. The Eleventh Circuit refused to allow discovery by the defendants but ruled that they were entitled to an evidentiary hearing, where they could question IRS officials concerning the reasons for issuing the summonses. The government argues that such evidentiary hearings, based on unsupported allegations of improper purpose, needlessly delay the IRS’s investigations. The defendants argue, and the Eleventh Circuit agreed, that facts concerning the purpose of the summons are in the IRS’s possession; an evidentiary hearing is necessary for a defendant to have a meaningful opportunity to challenge a summons. Now the Supreme Court will decide the issue. The Court’s decision could have a significant impact, if summons enforcement proceedings are filed more frequently as a result of the new IDR process effective January 2nd. If you have any questions about this issue, please contact one of us or any of the other Tax lawyers at Thompson & Knight.