The new ruling gives the IRS "startlingly broad authority to pry into the financial records of people who may be only remotely connected to a delinquent taxpayer," according to one lawyer briefed on the decision, the Epoch Times reports.
The ruling, a victory for the Biden administration, came after the administration's attempts to strengthen IRS enforcement efforts became an issue in the midterm congressional elections. The Inflation Reduction Act, which President Joe Biden signed into law in August 2022, allocated almost $80 billion to the IRS to hire an extra 87,000 agents. Democrats say the IRS has long been underfunded, but Republicans say the extra money will be used to harass taxpayers.
At oral arguments on March 29 the justices had seemed sympathetic to the claim of the wife of a man who owed substantial taxes that the IRS went too far in pursuing her bank records without prior notice. At the same time, they acknowledged the agency needs effective tools to attempt to collect delinquent accounts. -Epoch Times
In the court's May 18 opinion, Chief Justice John Roberts wrote in Polselli v. IRS (court file 21-1599) sided with the Biden administration, which argued that the IRS does not need to provide notice to third parties, and that having to do so would give delinquent taxpayers "a head start in hiding assets."