William E. Schrambling Accountancy Corporation v. United States of America, Harold E. Allen v. United States

These consolidated appeals present two issues. First, whether tax return information that is included in notices of federal tax liens recorded in a California County Recorder’s office, and in a bankruptcy petition filed by the taxpayer, is confidential within the meaning of 26 U.S.C. § 6103 . Second, if the tax return information was confidential within the meaning of that section, whether the disclosure of that information in improperly issued notices of levy may give rise to liability under 26 U.S.C. § 7431 . We have jurisdiction under 28 U.S.C. § 1291 . Because we decide that the tax return information was no longer confidential we do not decide the second issue.

FACTS AND PROCEEDINGS

A. Schrambling v. United States.

In 1979, appellee William E. Schrambling Accountancy Corporation (“Corporation”) became delinquent in paying federal employment taxes and filing corporate income tax returns. In May, 1984, Revenue Officer Cheryl Matthews was assigned to collect the Corporation’s delinquent taxes and tax returns. In June, 1984, Matthews delivered a Final Notice and Demand pursuant to 26 U.S.C. § 6331 (d), to William Schrambling, the President and sole shareholder of the…