Federal prosecutors are asking a California court to compel Apple to comply with an IRS summons for user account records, part of an ongoing Swiss tax investigation into dual citizen Cristian Caruso. The case pits treaty-backed tax enforcement against concerns about privacy and data scope.
Caruso, a Swiss and Italian citizen, is fighting the summons in U.S. District Court in Northern California. He argues the IRS request is overly broad and lacks specific relevance to the Swiss inquiry. The data sought covers subscriber details, connection logs, payment information, and IP addresses from 2016 to 2023.
The IRS issued the summons at the request of Swiss tax authorities, citing the U.S.-Switzerland tax treaty. That agreement allows both governments to request financial data for enforcing their respective tax laws. Apple’s role is limited to compliance if the court sides with the IRS.
Caruso Challenges the Scope and Relevance
Caruso’s legal team says the IRS request amounts to a fishing expedition. They argue the data demand fails to meet the treaty’s “foreseeable relevance” standard, which requires a clear link between the requested information and the tax matter at hand. Caruso also notes that he lived in the U.K. during part of the period under scrutiny.
He wants the court to apply existing U.S. legal standards that reject overreaching demands lacking specific justification. If granted, the petition would block the IRS from forcing Apple to share the records.
Prosecutors Cite Treaty and Enforcement Authority
Federal attorneys maintain the request aligns with both domestic law and the bilateral tax agreement. They say the IRS is assisting Swiss authorities in determining Caruso’s potential liabilities and that such international cooperation is essential for cross-border enforcement.
“The IRS issued the summons as part of its obligations under the tax treaty between the United States and Switzerland,” government lawyers wrote in their court filing.
Privacy advocates warn that growing government reliance on tech firms to enforce tax laws raises concerns. Broad data requests can expose unrelated personal information and may overstep what’s needed for a legitimate probe.
Courts increasingly balance competing interests: enforcing tax law, honoring treaty obligations, and protecting user privacy. A ruling in favor of the IRS could set precedent for future requests. A win for Caruso could redefine how far the government can reach into tech platforms for foreign tax matters.
