Taxation & Estate Planning

New IRS Appeals Programs - Yet Another Reason Why You Want a Tax Attorney to Handle Your IRS Problem Case!

By Darrin Mish

Many taxpayers hire CPAs or Enrolled Agents to handle their IRS problem cases. I guess they think that tax attorneys are too expensive or they fear the (often deserved) reputation of attorneys in general. But the IRS announcement of two new IRS appeals programs may cause you to think twice about who you hire to handle your Offer in Compromise or Trust Fund Recovery Penalty (TFRP) case.

With the announcement of nonbinding mediation and binding arbitration in Offer in Compromise and Trust Fund Recovery Penalty cases, yet another arrow in the tax attorney's quiver has been added. Just think about the different types of training the three types of tax professionals receive.

CPAs are primarily trained in the area of accounting. That's great. We need CPAs to perform a wide range of financial services. But how much training in the area of dispute resolution are they required to take? None. And these two types of new IRS appeals are in the area of alternative dispute resolution to boot! Alternative dispute resolution is a fancy way of describing settling cases out of court or short of going to trial. I can almost guarantee you that any CPA you have spoken with has never received ANY training in this area whatsoever.

Now let's turn our attention to enrolled agents. What's an enrolled agent you ask? Good question. An enrolled agent is a person licensed by the IRS to represent you before the IRS. Think about that for a second….let it really sink in. Ok. So they're licensed by the IRS and a person can achieve this status one of two ways. First and most common, they worked for the IRS for five years or more. Great does that qualify them to represent them in mediation or arbitration? Well technically yes…because the IRS says so. Does the IRS have taxpayer's best interest at heart? You decide.

Tax attorneys quite the contrary often have significant experience in the resolution of disputes. In law school for the past couple decades, law students have studied alternative dispute resolution. And the new IRS appeals programs are much more akin to court proceedings than anything we have ever had available to resolve IRS problem cases (short of filing suit against the United States of America.) Tax attorneys are trained in critical thinking and advocacy. Furthermore they have taken an oath to protect their clients interests no matter what.

In closing, I think that taxpayers with IRS problems should think long and hard before choosing anyone other than an experienced well-versed tax attorney to handle their IRS problem matter. There is no such thing as an easy, open and shut IRS problem case. You never know where it might lead or what procedural steps might be necessary to prevail.

Full post as published by IRS Problem Solver Blog on December 03, 2008 (boomark / email).