IRS ordered to pay damages for taxpayer’s emotional distress

Now here’s a case you might think would really open the floodgates: Prof. Paul Caron of the University of Cincinnati reports at TaxProf (Sept. 17) that a court has ordered the Internal Revenue Service to pay a taxpayer $10,000 for the emotional distress occasioned by its overzealous collection techniques. The case arose in bankruptcy proceedings, […]

Now here’s a case you might think would really open the floodgates: Prof. Paul Caron of the University of Cincinnati reports at TaxProf (Sept. 17) that a court has ordered the Internal Revenue Service to pay a taxpayer $10,000 for the emotional distress occasioned by its overzealous collection techniques. The case arose in bankruptcy proceedings, however, and its relevance as precedent for solvent taxpayers is not clear. The $10,000 will be paid at the expense of other taxpayers who presumably will surrender their money in a way that involves no emotional distress for them.

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