Tax Legal Services · Primary-source case analysis

United States v. Clarke: Examining IRS Agents Requires a Plausible Bad-Faith Showing

By Aneeta Mishra and Timothy Chan

Published April 19, 2026

Clarke balances the summary character of an IRS summons-enforcement proceeding against the taxpayer's right to challenge a summons issued in bad faith.

The IRS sought partnership records

The IRS summoned respondents for information relevant to Dynamo Holdings' tax obligations. When they did not comply, the government sought enforcement. The respondents alleged improper motives and asked to examine the responsible agents.

Good faith is the enforcement question

The IRS ordinarily makes a prima facie showing through the Powell factors: legitimate purpose, potential relevance, information not already possessed, and compliance with required administrative steps. A taxpayer may challenge the showing, including by proving improper purpose.

Specific facts are required

Bare allegations do not create an automatic right to question agents. Circumstantial evidence may suffice, and the taxpayer need not prove the entire defense in advance, but the submission must plausibly raise an inference of bad faith tied to specific facts or circumstances.

Disposition

The Court vacated the Eleventh Circuit's categorical examination rule and remanded for application of the plausibility standard with appropriate deference to the district court. Legal conclusions about what counts as an illicit motive remain reviewable.

Key takeaways

• Prepare evidence, not conjecture, before seeking an agent examination.
• Circumstantial facts can support the required inference.
• The enforcement hearing remains summary in nature.
• Separate factual plausibility from the legal definition of improper purpose.