Must a lawyer report another lawyer's failure to file income tax returns to the bar?
Apply this to your situation
This page answers the general question as of 1987. Ezel answers yours: whether it's allowed on your facts, under the current rules of professional conduct in your state, with citations.
Plain-English summary
The inquiring lawyer represented parties in a lawsuit against an opposing party who was a lawyer admitted in Arizona. In a deposition on a lost-earnings claim, that lawyer testified that he had never filed state or federal income tax returns since entering practice. The inquiring lawyer asked whether he had a duty to report this to the appropriate professional authority.
The committee concluded he did. ER 8.4(b) makes it professional misconduct to commit a criminal act that reflects adversely on a lawyer's honesty, trustworthiness, or fitness, and the Comment to ER 8.4 gives "willful failure to file an income tax return" as a specific example of such conduct. Because ER 8.3(a) uses similar (and partially identical) language, the committee concluded that a lawyer who knows another lawyer committed this type of criminal act is ethically obligated to inform the appropriate professional authority.
The opinion recognized one exception, which it described as intended to be very narrow: the duty does not apply if, based on the facts known, the reporting lawyer is convinced the failure was not willful within the meaning of the applicable criminal statutes and does not otherwise reflect on the other lawyer's honesty, trustworthiness, or fitness. The committee added that, while questions solely of law are outside its jurisdiction, where there are multiple failures to file (as the facts suggested), it would require an extremely unusual set of facts for a lawyer to become convinced the information should not be reported.
The opinion noted it did not address situations where the reporting lawyer obtained the information through a client-lawyer relationship with the other lawyer.
Currency note
This opinion was issued in 1987, before the State Bar of Arizona's adoption of the 2003 revisions to the Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.
Common questions
Q: Must a lawyer report another lawyer's failure to file tax returns?
A: The opinion concluded yes; willful failure to file is a criminal act reflecting on fitness under ER 8.4(b), and ER 8.3 requires reporting such conduct to the appropriate professional authority.
Q: Is there any exception?
A: Yes, but a narrow one; the duty does not apply if the lawyer is convinced the failure was not willful and does not otherwise reflect on the other lawyer's fitness, and the committee said multiple failures would rarely meet that exception.
Q: Does the duty apply if the information came from representing that lawyer?
A: The opinion expressly did not address situations where the reporting lawyer obtained the information through a client-lawyer relationship with the other lawyer.
Background and rules framework
The opinion applied ER 8.3 (Model Rule 8.3), which requires reporting another lawyer's violation that raises a substantial question as to honesty, trustworthiness, or fitness, and ER 8.4(b) (Model Rule 8.4), which makes a criminal act reflecting adversely on fitness professional misconduct. It relied on the Comment to ER 8.4 identifying willful failure to file a tax return as such conduct.
Citations and references
Rules of Professional Conduct:
- ER 8.3 / Model Rule 8.3 (reporting professional misconduct)
- ER 8.4(b) / Model Rule 8.4 (criminal acts reflecting on fitness)
See also
- AZ Ethics Op. 87-19: Monitored Jail Conferences
- AZ Ethics Op. 87-25: Interviewing Unserved Defendant
- AZ Ethics Op. 87-03: Reporting Cash Fees
Source
Original opinion text
Reproduced from the official source for research purposes. The linked source is authoritative.
12/1987
Ethical responsibility of a lawyer who has knowledge of another lawyers failure to file income tax return.
FACTS
The inquiring lawyer represents parties in a lawsuit in which the opposing party is a lawyer admitted to practice in Arizona. In response to deposition questioning relating to a lost earnings claim, the lawyer testified that, since entering practice, he had never filed state or federal income tax returns.
QUESTION
Does a lawyer who knows of another lawyer's failure to file an income tax return have an ethical duty to inform the appropriate professional authority of this information?
ETHICAL RULES INVOLVED
ER 8.3. Reporting Professional Misconduct
(a) A lawyer having knowledge that another lawyer has committed a violation of the Rules of professional Conduct that raises a substantial question as to that lawyer's honesty, trustworthiness or fitness as a lawyer in other respects, shall inform the appropriate professional authority.
ER 8.4. Misconduct
It is a professional misconduct for a lawyer to:
(b) commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects;
OPINION
ER 8.4(b) states that commission of "a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects" constitutes professional misconduct. In view of the presence of similar (and, indeed, partially identical) language in ER 8.3(a), it is clear that another lawyer who has knowledge of the commission of this type of criminal act is ethically obligated to inform the appropriate professional authority. The Comment to ER 8.4 specifically mentions, as an example of the type of illegal conduct that reflects adversely on a lawyer's fitness to practice law, "willful failure to file an income tax return."
Based on the foregoing, it is the opinion of the committee that a lawyer who has knowledge of another lawyer's failure to file an income tax return has the ethical duty to inform the appropriate professional authority of this information, unless, based on facts known to the lawyer, he or she is convinced that such failure was not willful within the meaning of the applicable criminal statutes and does not otherwise reflect on the other lawyer's honest, trustworthiness or fitness as a lawyer in other respects. In light of the specific reference in the Comment to ER 8.4 to a “willful failure to file an income tax return," and the importance to the integrity of the profession of the self-policing aspects of the Rules of Professional Conduct, the committee considers it appropriate to note that the exception contained in the preceding sentence is intended to be very narrow. In this regard, although the committee's jurisdiction does not extend to questions solely of law, the committee considers it appropriate also to note that where (as is suggested by the facts presented by the inquiring lawyer) there are multiple failures to file income tax returns, it would require an extremely unusual set of facts for a lawyer to become convinced, for the purposes of this opinion, that the information should not be reported.
This opinion does not address situations in which the lawyer who obtains such information does so in connection with a client-lawyer relationship between that lawyer and the other lawyer.
© State Bar of Arizona 1987
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