Tax Laywer Referral

Technical topics regarding tax preparation.
#1
Posts:
2887
Joined:
21-May-2018 7:50am
Location:
Northern MI and Coastal SC
Hi,

I have a SC client that has to go to tax court because of some issues with IRS--it escalated very quickly and I cannot quite identify why given no audit occurred, but I also cannot ascertain the significant adjustments proposed by IRS--they're HUGE and my client's response was very poor.

I reviewed everything and I do not see any other option to address than tax court, and it appears part of the issue is Prudential not properly reporting a trustee-to-trustee rollover (they referenced Code 1 on 1099-R). I do not have any relationships with a tax lawyer, so hoping you all can provide some referral options I can provide to this client.

Thanks!
 

#2
Nilodop  
Posts:
18761
Joined:
21-Apr-2014 9:28am
Location:
Pennsylvania
Did client disregard IRS notices? Is it too late to bump it back to Appeals?
 

#3
Posts:
2887
Joined:
21-May-2018 7:50am
Location:
Northern MI and Coastal SC
As far as I can tell, "client" did not respond timely and it then escalated. Most recent notice only suggests acceptance of changes and deficiency amount, or tax court. Nothing in between like the original CP2000. Their response was horrendous and did not even actually provide any real evidence, and their CPA/tax preparer was equally horrendous in their advice.
 

#4
Posts:
2612
Joined:
24-Jan-2019 2:16pm
Location:
North Shore, Oahu
I have a friend who is a great tax attorney and a great guy - but he's in Hawaii - does this make a difference?
Last edited by ItDepends on 24-May-2022 2:00am, edited 1 time in total.
 

#5
Nilodop  
Posts:
18761
Joined:
21-Apr-2014 9:28am
Location:
Pennsylvania
I assume the "most recent notice" is the 90-day one. File the petition including what should have been provided before, clearly supporting the reasons they owe no tax, and TC will (I think) bounce it to Appeals, where either they'll get a No Change letter, or you can help them with the appeal.

https://www.irs.gov/individuals/underst ... 19n-notice

https://www.ustaxcourt.gov/rules.html
 

#6
Posts:
2887
Joined:
21-May-2018 7:50am
Location:
Northern MI and Coastal SC
Yes, 90 day notice. I don't have any experience with filing a petition with TC and it's my understanding a CPA cannot even file a petition unless they've been admitted to practice in TC...
 

#7
Posts:
1362
Joined:
22-Apr-2014 9:07am
Location:
Chicago, IL
CornerstoneCPA wrote:Yes, 90 day notice. I don't have any experience with filing a petition with TC and it's my understanding a CPA cannot even file a petition unless they've been admitted to practice in TC...


https://www.taxprotalk.com/forums/viewtopic.php?f=8&t=15768&hilit=+court

Filing a claim with the tax court is actually quite easy and as stated in prior post will get the case assigned to an appeals officer. Any CPA or EA can represent a taxpayer before the appeals officer. I've had several clients prepare their own claim in order to get the process started, then I work with the appeals officer and have always been able to get the issue resolved at that level. As in your situation, these are not generally complex matters but simply dealing with IRS agents that won't look at additional information and a 90-day window closing in.

It has been discussed previously (perhaps on the old board) whether helping your client fill out the paperwork to file the claim is practicing law. Personally I have no problem helping my client fill out the paperwork, but I am very close to my clients and would do the same for a family member or friend.
 

#8
Posts:
5702
Joined:
21-Apr-2014 7:21am
Location:
The Land
I agree with pretty much what everyone is saying.

Just get the petition filed, however you want to do that, through and attorney or have the client do it with your assistance. Whatever.

But let me add one thing: Filing a petition only preserves your rights. The IRS will still work the case even if you fail to timely respond to the 90-day letter. But that is not recommended (i.e., not responding). But what is recommended is that you draft a letter to the IRS, with a statement of facts and with supporting documentation. This way, you’ll be on record and (1) someone might start working the case and (2) you will have something to give to the Appeals Officer when the time comes.
 

#9
Nilodop  
Posts:
18761
Joined:
21-Apr-2014 9:28am
Location:
Pennsylvania
It has been discussed previously (perhaps on the old board) whether helping your client fill out the paperwork to file the claim is practicing law.. Federal income tax practice is tehauthorized practice of law. And a CPA can get authorized fro Taax Court practice after certain requirements are met. I don't think you need to meet those requirements just to file a petition on (what appears to be) a slam-dunk issue.
 

#10
Posts:
2887
Joined:
21-May-2018 7:50am
Location:
Northern MI and Coastal SC
Thanks. I don't mind handling the actual appeal if I can gather appropriate evidence that supports the position, have certainly handled similar matters. There are both income and deduction issues at hand. Regardless, I will hire someone else to file the petition if this client hires me. My initial gut feeling says there is more to the picture than I am currently seeing and so I want someone involved that can work with the TC or otherwise consult with me on an as-needed basis.

For example, Schedule 1 references a Schedule E, but no Schedule E is found in the supposedly filed tax return I received today. The only other reference is on 8995. There are some other issues at hand that could be mistakes of third-parties or...not. There is an S-Corp but again, no Schedule E...WTF? This return was prepared by another CPA. Also no state credit for an active trade or business which is ludicrous based on information I currently have available to me (particularly since it is not indicated to be a passive activity).

If this prospective client had not been referred to me by a lawyer I know and trust, I likely would have already rejected it. The taxpayer's response to the initial CP2000 did not at all address the issues at hand, and the CPA provided only a handwritten note briefly explaining ONE issue but it was not a proper resolution. Situations like this make me an advocate for it being even MORE difficult to become a CPA...
 


Return to Taxation



Who is online

Users browsing this forum: Anderly, artp, FiguredBasis, Google [Bot], Google Adsense [Bot], itssewtaxing, JAD, JessCPA113, JoJoCPA, jon, ManVsTax, MAPCPA60, MilesR, missingdonut, SALYstrikesagain, Seaside CPA, Tangled Web, taxp2345 and 184 guests