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The Tax Practice of IIT Chicago-Kent College of Law
The Tax Practice of IIT Chicago-Kent College of Law

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A Three-Piece Suit and the Truth

Posted on in Uncategorized

With apologies to country songwriter Harlan Howard*, I want to share some thoughts about what, I believe, generally makes for a good professional relationship, especially in the context of tax controversy representation.

Perhaps its obvious, but any tax professional that promises specific results, like how much money he can save you by submitting an Offer in Compromise with the IRS to reduce your tax debts, or what result he will achieve for you in Tax Court litigation, is not to be trusted. Even after a thorough exploration of all the relevant facts, and a similarly exhaustive analysis of all the controlling laws and applicable policies, there is simply no way to predict with certainty how the IRS or a Tax Court judge will resolve a particular dispute. There are just too many factors.

In the collection arena, most every significant decision made by the IRS is discretionary. Whether to accept an installment agreement that is outside the "streamlined" criteria, for example, will be based on a balancing of considerations, both policy-driven, and situational. Not only do different IRS employees have different ideas about what constitutes an "economic hardship", different geographical offices of the IRS continue to display decision-making patterns that are internally inconsistent and, in some instances, arbitrary. And while we all must maintain a positive, realistic appreciation for the integrity of our tax collection civil servants, it certainly does appear at times that individual Collection managers, Appeals Officers and even IRS Counsel attorneys apply their governing policies somewhat selectively, perhaps even discriminatorily.

So, given the unpredictability of such a system, what makes a good representative, and how does a good representative deal with these uncertainties to your benefit?

First, and most important, a good representative is someone who tells you the truth, even if it hurts. You never benefit from distorted or intentional optimism. Even the best tax specialists cannot achieve some results for everybody. LIke all areas of life, if it sounds too good to be true, it probably isn’t.

Second, a good representative steps up and resolves your issues by playing the cards that have been dealt. He doesn’t misrepresent your financial situation to the IRS or intentionally omit assets on your financial information statement so as to yield a lower "reasonable collection potential", for example. A good representative knows that any short term benefits to this illegal and unethical way of practicing will surely come back to damage you in the most serious ways. A good representative takes control and offers to the IRS unique and attractive alternatives, creative ways of resolving disputes that appear to provide "win-win" benefits to both you and the Service. He convinces the IRS that there will be no more noncompliance on your part, that you desire finality.

Lastly, a good representative is more interested in solving your problem than putting money in his cash register. Sure, its a business, and money is the gas that fuels the representative vehicle. But the representative shouldn’t be in the business - shouldn’t be your representative, anyway - unless he sincerely cares about you and resolving your problem with passion and empathy, and by bringing all his training, experience, skills and enthusiasm to the fight, each and every step of the way. A good representative is responsive to your needs and, more importantly, is accessible when you have questions. He doesn’t ignore your calls after the fee has been paid. That’s a whole lot more important than the promises he makes at the initial consultation, or the artwork in his office, or the type of label on his three-piece suit, don’t you think?

* As the story goes, when Howard was asked by a journalist "What makes a great country song?", he responded with the now famous, eloquent "three chords and the truth". Contrary to a widely-held belief, the phrase was not originally coined by Saint Bono to describe good rock and roll, though he certainly achieved much recognition (and mis-attribution) when he quoted Howard on the (mostly) live U2 recording Rattle and Hum ("...a red guitar, three chords, and the truth").

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