Disclosure of tax returns in litigation: privileged or not?

It doesn’t seem as clear as it use to be that you don’t have to turnover your tax returns to your opponents in litigation.  The below quote is from a recent memorandum from one of our judges (bankruptcy judges).  I want to make sure I can find it some day when I need it.

As explained in Weingarten v. Superior Court, 102 Cal. App. 4th 268, 274, 125 Cal. Rptr. 2d 371, 375 (2002):

California courts … have interpreted state taxation statutes as creating a statutory privilege against disclosing tax returns. The purpose of the privilege is to encourage voluntary filing of tax returns and truthful reporting of income, and thus to facilitate tax collection.   But this statutory tax return privilege is not absolute. The privilege will not be upheld when (1) the circumstances indicate an intentional waiver of the privilege; (2) the gravamen of the lawsuit is inconsistent with the privilege; or (3) a public policy greater than that of the confidentiality of tax returns is involved.  This latter exception is narrow and applies only “when warranted by a legislatively declared public policy.” (Ibid.) A trial court has broad discretion in determining the applicability of a statutory privilege.

Added 8/17/2019.  See also Strawn v. Morris, Polich & Purdy, 30 Cal. App 5th 1087 (2019)(tax return protection is to facilitate tax collection); Webb v. Standard Oil, 49 Cal. 2d 509 (1957); Schnabel v. Sup. Court 5 Cal 4th 704 (1993); Weingarten v. Sup Court 102 Cal. App 4th 268 (2002).

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