26 U.S.C. § 7609 — Special procedures for third-party summonses

(a) Notice: (1) In general: If an IRS summons asks for testimony, records, or computer software source code about someone other than the person summoned, and that other person is named in the summons, the IRS must notify that named person. Notice must go out within 3 days of serving the summons, but no later than 23 days before the date set for examining the records. The notice must include a copy of the summons and explain the person's right to ask a court to quash it. (2) Sufficiency of notice: Notice counts as given if, by that third day, it is either served the normal way (as in section 7603), mailed by certified or registered mail to the person's last known address, or — if there is no last known address — left with the person who was summoned. If mailed, it goes to the last known address of the person entitled to notice, or, for a fiduciary relationship reported to the Secretary under section 6903, to the fiduciary's last known address, even if that person or fiduciary has since died, lost legal capacity, or ceased to exist. (3) Nature of summons: Any summons covered by this rule (and any summons to help collect a debt, described in (c)(2)(D)) must identify the taxpayer the summons concerns, or the other person whose records are wanted, and must give enough information for the summoned person to find the records. (b) Right to intervene; right to proceeding to quash: (1) Intervention: A person entitled to notice under (a) can join, as a party, any court case about enforcing that summons. (2)(A) Proceeding to quash: That same person can start a court case to quash the summons, within 20 days after notice is given. In that case, the Secretary can ask the court to instead compel compliance. (B) That person must, by the end of that 20-day window, mail a copy of their court filing (by registered or certified mail) both to the person who was summoned and to the IRS office named in the notice. (C) The person who was summoned can join that court case too, and is bound by its outcome whether or not they actually join in. (c) Summons to which section applies: (1) In general: This section covers summonses issued under section 7602(a)(2), or under sections 6420(e)(2), 6421(g)(2), 6427(j)(2), or 7612 — except for the summonses listed in paragraph (2). (2) Exceptions — this section does not apply to a summons that is: (A) served on the person whose own tax liability is being investigated, or on that person's officer or employee; (B) issued just to find out whether business records exist; (C) issued just to identify who holds a numbered bank account; (D) issued to help collect (i) an assessment or judgment already made against the person, or (ii) a related transferee's or fiduciary's debt; or (E) issued by a criminal investigator investigating a tax-law offense, and served on someone who is not a "third-party recordkeeper" as defined in section 7603(b). (3) A John Doe summons (subsection (f)) or the special-exception summons (subsection (g)) also do not get notice under subsection (a). (4) "Records" here means books, papers, and other data. (d) Restriction on examination of records: The IRS cannot actually examine records that require notice under (a) until: (1) 23 days have passed since notice was given, or (2) if someone filed a timely quash proceeding under (b)(2)(A) and properly notified the required parties under (b)(2)(B), not until the court handling the case orders it or the person who filed to quash agrees. (e) Suspension of statute of limitations: (1) If the taxpayer (or someone acting for them) takes action under (b) to intervene or quash, the normal time limits on assessing tax (section 6501) or bringing criminal charges (section 6531) are paused while that court case, and any appeals, are pending. (2) If no one has responded to the summons yet, the same time limits are paused for anyone whose tax liability the summons concerns (other than someone who took action under (b)) — starting six months after the summons is served, and ending when the response is finally resolved. (f) Additional requirement in the case of a John Doe summons: A "John Doe" summons — one that does not name the person whose liability is being investigated — can only be served after a court proceeding where the Secretary proves: (1) the summons relates to investigating a specific person or an identifiable group or class of people; (2) there is a reasonable basis to believe that person or group failed, or may have failed, to follow some internal revenue law; and (3) the information sought (including the identities involved) is not reasonably available elsewhere. The Secretary also cannot seek information beyond what is narrowly needed to address that suspected failure. (g) Special exception for certain summonses: A summons is exempt from the notice rule if, after the Secretary petitions the court, the court finds there is reasonable cause to believe that giving notice could lead someone to hide, destroy, or alter records; intimidate, bribe, or collude with others to block information from coming forward; or flee to avoid prosecution, testimony, or producing records. (h) Jurisdiction of district court; etc.: (1) The U.S. district court where the summoned person lives or is found has jurisdiction over cases brought under (b)(2), (f), or (g). If the court denies the petition, that is a final order that can be appealed. (2) For cases under (f) and (g), the court decides based only on the petition and supporting sworn statements, without the summoned party present (ex parte). (i) Duty of summoned party: (1) Once someone receives a summons for records, they must gather the requested records (or the part the Secretary specifies) and be ready to produce them on the date set for examination. (2) The Secretary can give the summoned party a certificate saying the window to quash the summons has passed with no quash proceeding filed, or that the taxpayer has agreed to the examination. (3) If the summoned party (or their agent or employee) hands over records or testimony in good-faith reliance on that certificate or on a court order, they cannot be held liable to a customer or anyone else for making that disclosure. (4) For a John Doe summons where a time limit was paused under (e)(2), the summoned party must tell the affected person about that suspension. (j) Use of summons not required: Nothing in this section limits the Secretary's ability to get information some other way, through the regular formal or informal procedures allowed under sections 7601 and 7602, instead of using a summons.