UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
MEMORANDUM AND ORDER
[1] Plaintiff Tax Analysts ("TA") sues defendants Internal Revenue Service ("IRS") and the Christian Broadcasting Network ("CBN") under the Freedom of Information Act ("FOIA") to obtain copies of a "closing agreement" 1 reached between CBN and IRS terminating the former's tax liability in conjunction with CBN's application in 1998 for restoration of its tax exempt status under section 501(c) of the Internal Revenue Code ("I.R.C."). The IRS responded to the complaint with an answer denying certain of plaintitf's factual Allegations implying possible chicanery in the approval of the application, and then followed it with a motion for judgment on the pleadings as a matter of law pursuant to Fed. R. Civ. P. 12(c) CBN has moved to dismiss the complaint for failure to state a claim upon which relief can be granted pursuant to Fed. R. Civ. P. 12(b)(6). Both motions will be granted.
[2] For essentially the reasons advanced by defendants. the Court concludes that the "closing agreement" (and documentary precursors thereof) is deemed to be "tax return information" wider I.R.C. section 6103, the disclosure of which is prohibited, and thus exempt from disclosure under FOIA Exemption 3, 5 U.S.C. section 552(b)(3). 2 As such. closing agreements are distinct from "applications" for tax exempt status, which are open to public inspection under I.R.C. section 6104. (The IRS has already furnished TA with CBMs exemption application papers). It is immaterrial, even if true, that tax exempt status is granted the applicant by the simulataneously, or in conjunction, with extinguishing any lingering tax liability of the applicant by a closing agreement. The closing agreement remains inaccessible to the public under either FOIA or I.R.C. section 6104, see Lehrfeld v. Richardson, 132 F.3d 1463, 1465 and 1467 (D.C. Cir. 1998). and does so in toto. Redaction is not an alternative. See Church of Scientology of California v. IRS, 484 U.S. 9 (1987). 3
[3] The Court also concludes that, notwithstanding I.R.C. section 6104 obliges an applicant for tax exemption to make its application papers available to the public on its own, section 6104 does not contemplate a private. right of action to enforce the obligation. S= Schuloff v. Queens College Foundation Inc., 994 F.Supp. 425 (E.D.N.Y. 1998), Bad, Schuloff v, Queens College 'Foundation, Inc., 165 F.3d 183 (2d Cir. 1999).
[4] It is, therefore, this 6th day of August, 1999,
[5] ORDERED, that the motions of defendants the Internal Revenue Service and Christian Broadcasting Network for judgment on the pleadings and to dismiss the complaint, respectively, are granted; and it is
[6] FURTHER ORDERED, that the complaint is dismissed with Prejudice as to both defendants.
Thomas Penfield Jackson
U.S. District Judge
1 A "Closing agreement" is an agreement entered into between the IRS and a taxpayer "relating to the [tax] liability of [the taxpayer]." See 26 U.S.C. section 7121(a).
2 See Tax Analysts v. Internal Revenue Service, Civ. No. 94- 2220 (TFH), Memo. Op., March 16, 1999.
3 Tax Analysts v. I.R.S, 117 F.3d 607 (D.C. Cir. 1997). considered redaction a possibility only with respect to FOIA requests for legal memoranda from IRS lawyers to its field agents not closing agreements.
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