Lawyers, tax or otherwise, understand that privileged information must be protected to encourage a full and frank dialogue that might not occur without confidentiality.1 Tax information, in particular, contains some of the most private information for both individuals and businesses. The private nature of tax return information is protected by statute with penalties imposed for wrongful disclosure.2 However, despite the private nature of tax and other information, courts still construe privileges narrowly under the theory that it inhibits the search for the truth.3 A recent case from the Fifth Circuit Court of Appeals, T. Lohermeyer, 4 has caused lawyers and the courts to re-examine the scope of privilege. This case serves as a reminder that lawyers must consider privilege at all stages of a tax dispute—including before a dispute arises.

Originally Published in Journal of Tax Practice & Procedure - July 2021.