Administrative Appeals & Tax Court Litigation

Phoenix Civil Tax Litigation

Your tax issues may start with a Notice from the IRS that it wishes to “review” your tax return. Or you may receive an IRS Notice that states you owe taxes or that your tax return has been changed by the IRS. Without careful and knowledgeable assistance in responding to such audit requests or IRS notices, you could unintentionally turn a quick response into several years of audit and substantial tax, penalty, and interest.McFARLANE LAW – A Tax Law Firm - can assist you in your initial response. We have the knowledge and experience to give you the needed direction, or handle the audit, so you have as favorable a result as possible under the circumstances.

Remember that the IRS has its attorneys and tax law experts, and it is important you have professional assistance, too; both to insulate you from direct contact with the Revenue Agents and Revenue Officers; but also to correctly walk through the thicket of IRS procedures and rules that are foreign to taxpayers, some CPAs, and most non-tax attorneys. One wrong answer or failure to respond in a timely manner to IRS Notices and requests can result in significant tax and/or penalties determined against you. Our tax lawyers can chart a strategic course through the complicated tax issues, represent you before the IRS (or associate competent CPA assistance), and reach a reasonable resolution to your tax proble

We assist businesses and high net worth individuals in all aspects and issues with the IRS. If you experience a business audit or a personal audit, you have certain Taxpayer Rights such as the right to appeal a Revenue Agent’s determination or a Revenue Officer’s collection action. If you missed communication with the IRS and it has sent you a Notice of tax due, you have certain rights to review and/or appeal that collection action. If you cannot obtain a reasonable resolution to your issues, you can appeal the determination to the Office of Appeals. You or your business has the right to petition the Tax Court for an unbiased review by a Tax Court Judge.

Our Phoenix, Arizona, based attorneys represent high net worth individuals and businesses across the country in their IRS controversies. We receive referrals from CPAs and other tax professionals who are unable to represent their clients beyond a certain stage with the IRS. We are renowned as competent tax attorneys and have a good record and notoriety with the Revenue Agents, Revenue Officers, Appeals Officers, District Counsel attorneys, and Tax Court Judges who we have interacted with for the past 26 years.

Office of Appeals: What Is It and Why Is It Important to My Tax Problem Resolution?

The IRS has established an Office of Appeals to review disagreements between taxpayers and the IRS administrative level agents (Revenue Agents who examine tax returns; and Revenue Officers who collect tax liabilities). There are Appeals Offices located in various cities around the country and our tax attorneys represent taxpayers in any of these Appeals Offices. If you disagree with a Revenue Agent’s or a Revenue Officer’s decision, make sure you contact us so we can apprise you of your taxpayer rights, including your right to appeal the IRS decision. Importantly, there are specific response dates and time limitations that if not met, will preclude your ability to pursue a reasonable resolution.

The Office of Appeals was formed by the RRA Act of 1998 to provide a non-biased, impartial and independent review of a taxpayer’s contested issue. Taxpayers, or their counsel, may negotiate the resolution of federal tax disputes that arise from an IRS audit or from collection action (levy, garnishment of wages, liens, asset seizures, etc.), or other adverse IRS determinations (denial of requested relief such as innocent spouse, offers in compromise, penalty abatement, and trust fund recovery penalty issues). Appeals can also arrange for a payment plan such as an installment agreement, a lump-sum payment, or uncollectible account status.

Appeals Officers are often previous collection officers. They are normally CPAs and sometimes even attorneys. Appeals Officers are some of the highest trained personnel in the IRS. They are skilled negotiators and are well versed in tax law and IRS procedures. It is highly recommended that you have your hired tax attorney at your side when you interact with the Office of Appeals - or have your tax attorney handle the conference.

An Appeals Officer’s job is to review the facts of the case and the legal issues brought before them in light of the hazards of litigating the issues. Often, his or her role is to reduce the District Counsel’s caseload and thus may seek to settle cases that are not good cases for the government to take forward to Tax Court.

We at McFARLANE LAW – A Tax Law Firm have years of handling issues before the Office of Appeals. We personally know and have interacted with many of the Appeals Officers. That experience in successfully handling appeals cases, that familiarity with and personal relationships with the Appeals Officers, and the knowledge of the complex tax procedures allows us to properly represent you before the Office of Appeals.

There are several benefits of seeking appeals review of administrative actions or determinations, a few of which are the following:

• There is a strategy to having the Office of Appeals review your case, as Appeals Officers have more discretion in their ability to resolve issues in light of the issue going forward to Tax Court. At the Revenue Agent and Revenue Officer level, the agents and officers must follow the Internal Revenue Manual and their managers will restrict their discretion in their handling of issues. At Appealsthere is a benefit of broader discretion to resolve a taxpayer’s case. Of course, there is still policy, procedures, and other guidelines that must be followed so it is recommended that tax counsel be engaged to vigorously and zealously defend your interests.
• Another benefit is time management. It normally takes 6-12 weeks for a case to be transferred from examination (i.e., audit) or collections to appeals. During this interim period, the case (including collection action) is normally put on hold. This period of time can be constructively used by you and your counsel to prepare for the Appeals conference, to accumulate funds for greater bargaining power, to make monthly “voluntary payments” that establish a history of cooperation and good faith efforts to comply with the federal tax rules and regulations, and to strategize before the appeals conference takes place. We at McFARLANE LAW – A Tax Law Firm are masters at manipulating the allowable time management opportunities.
• Another benefit is to remove a taxpayer’s case from an overly aggressive collection officer. Sometimes taxpayers try to handle cases on their own and cannot resolve their case in a reasonable or acceptable manner. As a result, collection action on the part of the IRS continues and tempers are short on each side of the issue. There is an important move a taxpayer can make to have an experienced tax attorney intervene in the case. Even though late in the game, our attorneys are efficient and effective in unwinding wrong moves, toning down an otherwise contentious case; and they put the matter on track to a workable, acceptable resolution. If a collection officer is unwilling to participate in a workable resolution, an appeal of the issue can be taken to Appeals. At Appeals, not only can the issue be resolved, but a workable payment plan can be put in place.

The most important aspect of the appeals process is an understanding of the process and the presentation of a prehearing memorandum to frame the issues. A tax attorney can best analyze the timing for requesting an appeals conference, to prepare the legal argument citing case law and procedure, and to assist in preparing for the conference. If taxpayer seeks an alternative payment plan on any tax liability determined to be due at the appeals level, then a financial statement package must also be submitted prior to the appeals hearing. It is recommended that you engage a tax attorney to handle the appeals conference. Often it is best to insulate the taxpayer from the appeals officer.

Our lawyers at McFARLANR LAW – A Tax Law Firm can formulate a strategic plan in order to obtain the best possible results and to keep your tax liability to a minimum. After decades of dealing with Appeals Officers in Phoenix, San Francisco, Los Angeles, Fresno, Seattle, Denver, Dallas, Holtsville, and other offices across the country, we have the valuable working relationships with the Appeals personnel needed to obtain the best results for your particular case.

Negotiating With the IRS on Your Behalf

Filing a tax appeal or protest is a way of forcing the IRS to negotiate with you. The government does not like to spend time in litigation and is often willing to negotiate with the taxpayer. Unlike an individual taxpayer or CPA, Mr. McFarlane has the experience and ability to take your case as far as it needs to go — to the U.S. Tax Court if necessary.

Our lawyers provide a layer of insulation between you and the IRS. If you represent yourself before an IRS Revenue Agent or Officer, you could end up giving the IRS information that could result in a significant tax liability — or even criminal charges. Only an attorney can protect you under the umbrella of the attorney-client privilege.

Representing You in Tax Court

If the IRS denies your appeal, you will receive what is known as a “90-day letter.” Only an attorney can represent you before the U.S. Tax Court. This 90-day letter gives you 90 days to file a petition with the U.S. Tax Court to have your case heard in U.S. Tax Court. The U.S. Tax Court is stationed in Washington, D.C., but its judges travel to Phoenix, Las Vegas, Albuquerque, and other cities across the country several times a year to hear U.S. Tax Court cases. Our tax lawyers have extensive experience and are fully qualified to prepare your petition, the accompanying required documents, and represent you in Tax Court.

Do You Want to Go to Tax Court?

When I stated to a learned Louisiana man that I would like to witness a hurricane, he grew ashen and stated, “You do not want to experience a hurricane.” Tax Court is a similar situation. It is litigation, and by nature, is tumultuous and unpredictable. Nevertheless, sometimes an issue needs to be litigated. We at McFARLANE LAW, PLC have years of experience handling Tax Court litigation in a competent an effective manner.

Of course, our primary review of any case is to determine if an early and favorable resolution to the case is possible. Because Tax Court litigation holds a degree of risk, even in the best of cases, it is sometimes expedient to settle. We can analyze your facts and circumstances and advise as to whether Tax Court litigation holds the most favorable means to resolve your case.

When cases are not settled at the IRS audit or IRS appeal level, taxpayers have the right to petition the Tax Court. Although a taxpayer may appear pro per (self-representing), it is recommended that a U.S. Tax Court Petitioner seek an experienced Tax Court litigator. Because Tax Court rules and procedure are different from superior court and other courts of law, it is important to engage a tax litigation lawyer. We at McFARLANE LAW, PLC have the experience in U.S. Tax Court to effectively handle your Tax Court case. We are Tax Court litigators located in Arizona, but able to practice before the U.S. Tax Court in any state.

Sometimes, the best strategy is to push the government “toward the Tax Court steps” in the attempt to obtain a favorable or at least reasonable resolution. Sometimes there is no good solution, so taxpayers must work for the next best option. We at McFARLANE LAW, PLC have the knowledge of the tax laws and procedures, and the experience in Tax Court, at appeals, and before administrative agencies to effectively handle your tax case and analyze the hazards of proceeding to Tax Court.

The U.S. Tax Court is a traveling court. The many judges are assigned different courts located in different cities across the country. The other possible court is the U.S. District Court (or the First Circuit Court of Claims) to try your case. To qualify for District Court, you must first exhaust your administrative remedies and pay the disputed tax. We at McFARLANE LAW, PLC can handle your Tax Court or District Court case.

Learn more: Why should I hire a tax attorney?

Contact Our Maricopa County and Pima County Administrative Tax Appeals Lawyers

To arrange a free and confidential consultation with our Scottsdale based tax law attorney, call 480-991-0032 or contact us by e-mail. We represent clients in Phoenix, Scottsdale, Paradise Valley, Cave Creek, Fountain Hills, Glendale, Peoria, Surprise, Mesa, Tempe, Tucson, Casa Grande, Flagstaff and Sierra Vista, and throughout Arizona and the United States.