N.Y. Lawyers Are Targeted in IRS Inquiry

NEW YORK —  At least a dozen partners in New York law firms, including some from the city’s leading firms, are under criminal investigation by the Internal Revenue Service for alleged failure to file tax returns, an attorney for some of the lawyers said.

The lawyers apparently were detected in an IRS program that screened partnership information from a number of Manhattan law firms to find partners who had not filed returns, attorney Robert S. Fink said.

A nationwide effort to track down lawyers and other professionals who have failed to file tax returns is under way as part of a broader program to aggressively pursue non-filers.

Recently, the IRS asked state officials for the names and Social Security numbers of Pennsylvania’s 53,000 lawyers. A similar effort targeting lawyers and accountants is under way in northern Illinois, where the IRS found a substantial number of non-filers among the states’ certified public accountants, an IRS spokesman said.

The spokesman said the agency’s Manhattan office has screened partnership information from “50 major firms” in the city but said he could not comment on the results. Under the program, the IRS checked the informational tax returns filed by the law firm partnerships, which report the income distributed to each partner. The agency then checked its records to determine if any partners had failed to file a return.

Fink, who specializes in criminal tax defense, said he was told by an IRS agent that 300 non-filers were detected in the program and that the agency was “so surprised” at the number that it may expand the screening procedure.

The IRS investigation focused on at least two tax years, according to Fink.

He declined to name any of the lawyers under investigation or the firms in which they are partners.