Some of the most vocal outrage we receive on our blog is from tax attorneys responding to this post where we make the admittedly hyperbolic statement that;
If you find yourself in Tax Court sitting next to an attorney, you’ve already lost.
Most of the complaints we get ask us to take down our post and point to our firms lack of professional courtesy. Perhaps they have a point but in fairness, so do we, and sometimes you do need to add a little shock value to your rhetoric to make people interrupt and re-assess the validity of their internal dialog.
So for now we’re keeping the post up because we simply don’t think a lot of tax attorney objections are grounded in firm logic. Statistics published by the IRS on Tax Court outcomes point to some very difficult statistics that tax payers with issues should be pondering before they go mano-a-mano with the IRS which we’ll share below.
Now after pondering those statistics if they still chose to go to a tax attorney, that’s fine; but at least they’ve been educated and are making a decision based on appropriate facts and evidence.
Ultimately we think most tax attorney objections to our post come down to this:
Cocksuckers pissin’ in your face wanna break your rice bowl, you get humiliated by some jag-off cop, you get shit thrown in your face by some genuine shit, but you endure (for a while). You’re a good fuckin’ man.
Dave Moss, Glengarry Glen Ross
Lawyers Are Fee Based Professionals
Anyone with tax issues is often desperate to get out of trouble with the IRS and tax attorneys are only too happy to oblige, billing clients for every minute worked (and then some). Like all fee based consultants, some lawyers find questionable ways to squeeze money out of clients. Most are legal, some aren’t, but all will make your bills rack up fast.
One particularly deplorable tax attorney practice is double billing clients. More than one-third of American lawyers admitted to occasionally double-billing clients in a 2007 survey from Samford University’s Cumerland Law School. Several years ago a New York lawyer settled a case where through double billing he claimed to have worked over 1,200 days in a year for clients.
The Tax Attorney Mindset
By nature, lawyers tend to get into prolonged disputes. Two attorneys in the same room together like to get into the fight and then fight as long as any hope remains even if the costs are mounting.
In fact, each attorney has an obligation to be as zealous an advocate as possible. Many times this approach is to the detriment of discovering the truth and of resolving conflicts to the satisfaction of both parties. How many times have you heard about a famous lawsuit where one of the parties fully confident in his or her case ends up paying hundreds and thousands of dollars in costs?
Always Look For The Angles
Beyond just nature, sometimes due to financial interest all lawyers tend to exploit legal procedures to the fullest. Yes we said it! As hourly fee based professionals tax attorneys have a financial interest to prolong cases and even push you towards tax court. Don’t get us wrong, we’re not saying all attorneys do this, but the mere fact that the incentive exists should make anyone looking at their legal bills think twice.
The Odds Are Not On Your Side In Tax Court
So if you hire a tax attorney and due to his nature and perhaps financial interest you end up fighting the tax man in court, what happens next?
Several years back the National Taxpayer Advocate released their annual report to Congress listing the top-10 tax issues litigated in the Federal courts. Of these 923 cases, taxpayers represented by counsel won just 20% (and that was a good year). Let us be clear on the implications of this; it means if you’ve somehow ended up in Tax Court sitting next to a tax attorney, there’s an 80% chance you’re about to lose.
That’s worse than the odds in Las Vegas Black Jack.
Why Is It So Hard To Win In Tax Court?
The IRS hates to lose and only fights cases it knows it can win. The reason for this is that tax case outcomes are public and the IRS does not want to lose and set a precedent with the case that could be used by others to undermine compliance with tax and and encourages taxpayers to further challenge the IRS.
Remember also that the IRS has very deep pockets. Their backer is the only entity that has the ability to print the worlds reserve currency (USD’s). Courtesy of Uncle Sam, financial considerations ultimately are just not a factor for the IRS. They can easily drag you thru the courts if they want all the way until your sitting in front of John Roberts. The IRS can assign numerous Revenue Agents, technical advisors and lawyers to litigate a position it feels is important, without incurring an additional expense. They all work for the government so its all free, albeit paid for by you and me.
Enrolled Agents Work On Fixed Fees, Charge Less And Have No Incentive
Although not as well known to the public as CPAs or tax attorneys the 50,000 practicing Enrolled Agents (EA) across the US are the only tax professionals who get their license to practice directly from IRS and the United States Treasury. They can do everything a Tax Attorney can, apart from representing you in tax court hence there is no incentive for them to prolong the battle or leap forth into the fight.
Additionally, there are only two paths to becoming an EA. After working for the IRS for five years, an agent can become an EA without passing an examination. Without working for the IRS, one must pass a thorough background check and a three part exam.
Enrolled agents specialize in their knowledge of the tax code and tax matters. An EA must know all of the ins and outs of income tax, gift tax, inheritance tax, estate tax, and payroll tax to a far deeper and wider extent than any tax attorney. Additionally the cost for Enrolled Agents is only a FRACTION of what most tax attorneys charge.
If you’re ready to settle your tax problem with the IRS and want to speak to an Enrolled Agent right now just call 609-630-8285 and set-up a free 30 minute consultation. You can also use the form below to submit your request.
