Academic journal article Journal of Accountancy

Supreme Court Won't Review Textron

Academic journal article Journal of Accountancy

Supreme Court Won't Review Textron

Article excerpt

The U.S. Supreme Court declined to review Textron Inc. v. U.S. (Sup. Ct. docket no. 09-750), letting stand a First Circuit Court of Appeals decision that the work product privilege did not protect the corporation's tax accrual workpapers from an IRS summons. For the First Circuit's decision, see U.S. v. Textron Inc., docket no. 07-2631 (1st Cir., 8/13/09) (en banc). For earlier Tax Matters coverage, see "First Circuit Denies Textron Work Product Privilege," Nov. 2009, page 76; and "Work Product Stands Up to IRS Summons," Nov. 2007, page 80.

While auditing the 1998-2001 tax returns of Textron Inc., the IRS issued an administrative summons for Textron's tax accrual workpapers. Textron refused to supply the workpapers to the IRS, which petitioned the U.S. District Court for the District of Rhode Island to enforce the summons. In district court, Textron argued that its tax accrual workpapers were protected by either the attorney-client privilege, the tax practitioner privilege or the work product privilege. The district court rejected Textron's attorney-client and tax practitioner privilege claims; however, it held that the workpapers were protected by the work product privilege (Textron Inc. v. United States, 507 F. Supp. 2d 138 (D. R.I. 2007)).

Among the questions for the court was whether the documents qualified for protection as having been "prepared in anticipation of litigation or for trial" (Fed. …

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