## Facts

- An IRS special agent investigated a taxpayer’s federal income tax liability for 1967–1971.
- The agent issued a summons under 26 U.S.C. § 7602 to the taxpayer’s attorney, seeking records of charges and payments for legal services, including amounts, dates, payors, and methods of payment.
- The attorney appeared but refused to produce records or testify, asserting attorney-client privilege.
- The government petitioned to enforce the summons under 26 U.S.C. §§ 7402(b) and 7604(a).
- The attorney asserted (by affidavit) that the records would reveal the general nature of services and that the investigation was criminal in character.
- After hearings in which the agent was the only witness, the district court denied enforcement, holding the requested information was privileged.

## Issues

1. Whether attorney-client privilege under federal law protects an attorney’s fee and payment records (amounts, dates, payors, methods) from production in response to an IRS summons in a tax investigation of the attorney’s client.
2. Whether an asserted criminal investigative purpose alters the privilege analysis.
3. What showing is required to invoke any exception where fee information would reveal confidential attorney-client communications.

## Decision

- The Tenth Circuit reversed the denial of enforcement and remanded with directions to enforce the summons.
- The court held that the attorney-client privilege generally does not cover client fee and payment information sought by the IRS.
- The court rejected the claim that a criminal investigative purpose broadens the privilege.
- The court found the attorney’s conclusory affidavit insufficient to establish that disclosure would reveal confidential communications.

## Legal Principles

- In federal income tax investigations, privilege questions are governed by federal law.
- Attorney-client privilege is limited to confidential communications made for the purpose of obtaining legal advice or assistance and is strictly construed.
- As a general rule, client identity, fee amounts, payment dates, payor identity, method of payment, and general purpose of work are not privileged.
- A narrow exception may apply when disclosure of fee-related information would itself reveal the substance of a confidential professional communication, but the proponent must support the claim with specific facts.
- The party asserting the privilege bears the burden of establishing its applicability; generalized or conclusory assertions are inadequate.

## Conclusion

The court ordered enforcement of the IRS summons because fee and payment records are ordinarily outside the attorney-client privilege, and the attorney failed to make a specific factual showing that production would disclose confidential legal communications, regardless of whether the investigation had potential criminal implications.


United States v. Hodgson, 492 F.2d 1175 (10th Cir. 1974)