Case: U.S. District Court Upholds California Tax Return Privilege, Denies Motion to Compel Estate Appraisals

The U.S. District Court denied the taxpayer’s motion to compel production of appraisals attached to an estate tax return, holding that the appraisals were protected by California’s tax return privilege. Taxpayer, the executor of an estate, objected to producing appraisals of estate assets that were attached to the estate’s Form 706 tax return. The court found the appraisals were relevant to the taxpayer’s efforts to collect on a judgment, but concluded they were covered by California’s tax return privilege because they were required to be submitted with the tax return and thus constituted an “integral part” of the return. The ...