Don't Mess With Taxes

Shock jock Howard Stern's candid conversations with guests are one of his show's more popular features.

Folks who talk to Stern, including the current Oval Office resident, willingly reveal TMI.

One on-air exchange, however, resulted in inadvertent revelation of some of a Massachusetts woman's personal tax information and a subsequent lawsuit against Stern and Uncle Sam.

As I noted back in May 2015, she was discussing her overdue tax bill with an Internal Revenue Service agent who had, on another line, called into Stern's satellite radio show.

When Stern went live with the tax collector's on-hold call, the IRS agent's conversation with the taxpayer was broadcast to millions of Sirius XM listeners.

Lawsuit filed, mostly dismissed: Not surprisingly in our litigious society, a lawsuit followed. The only surprise was that it wasn't filed until almost two years after the call.

When the taxpayer, Judith Barrigas of Sandwich, Massachusetts, did decide to go to court, she named as defendants not just the IRS (technically the U.S. government), but also Stern, accusing him and his radio show of negligence, invasion of privacy and intentional infliction of emotional distress.

On March 9, a federal judge sided with Stern, throwing out all claims against the radio and television personality.

"Although they might have become aware during the broadcast that [IRS agent Jimmy] Forsythe was discussing taxes or collections generally, a specific individual was never named in relation to such information, and the telephone number was not disclosed until the final seconds of Agent Forsythe's conversation with plaintiff," wrote U.S. District Judge Allison Burroughs in dismissing the case.

Barrigas' other personal data, including her name, her Social Security number, address or other identifying information were not disclosed, noted the judge. "The only link between Plaintiff and the disclosure was the telephone number, which she admits was publicly listed and would have required an internet search to identify her," wrote Burroughs.

"It is unclear how broadcasting the statements of a caller to a radio show, who vaguely discusses tax amounts and repayment terms of an unspecified third party, constitutes an intentional invasion of the third party’s privacy," added Burroughs.

IRS still on one hook: While Stern is now in the clear for his inadvertent tax eavesdropping, the Uncle Sam still has an issue that must be adjudicated.

Burroughs, in her 23-page ruling earlier this month, did agree with the federal government that under the Federal Tort Claims Act it is exempted from negligence and privacy liability in matters that involve tax collection.

However, the judge did allow a charge of disclosure of tax return information against the government to proceed.

That's not surprising since, as we learned from presidential candidate decisions to reveal (Mitt Romney, finally) or not (Donald J. Trump, never) their tax filings, tax returns are confidential. Only the taxpayer can release information on the returns.

To enforce that privacy promise, Section 7431 of the Internal Revenue Code permits a taxpayer to seek civil damages from the IRS for its unauthorized disclosure of tax returns and return information "if any officer or employee of the United States knowingly, or by reason of negligence, inspects or discloses any return or return information with respect to a taxpayer."

What about the agent? And while the judge appeared to chide Forsythe in her ruling —

"The Court agrees with Plaintiff that Agent Forsythe’s personal telephone call to The Howard Stern Show, and the partial disclosure of his conversation with Plaintiff regarding her taxes, went beyond the scope of his duties as an IRS employee."

— I'm still searching for details on what, if any, discipline he faced for calling Stern's show while doing his tax job.

You also might find these items of interest:

• IRS emphasizes its commitment to taxpayer privacy 
• Add EAs to the tax preparation — and privacy — mix
• IRS plan to access taxpayer email without warrants, raising privacy concerns