Tax Lawyer's Blog

“O, it is excellent to have a giant’s strength, but it is tyrannous to use it like a giant.”

 - Shakespeare, Measure for Measure, Act II, Scene ii -

In a recent post titled Grading the IRS on the Declaration of Taxpayer Rights I gave the IRS a “D” on it’s respect for and enforcement of a taxpayer’s right to counsel.

I may have been too generous.

Paul Caron of TaxProf Blog reported on Sunday about attorney who filed 3 TIGTA complaints against an IRS agent who, allegedly, told taxpayers not to hire a representative.

New Jersey lawyer, Robert Kenny, now alleges that he is under investigation by the Office of Professional Regulation. He believes it is in retaliation for his TIGTA complaints.

First, let me say that I do not know Mr. Kenny or the IRS official he has complained about. Nor am I familiar with the details of either his TIGTA complaints or the OPR investigation of him.

Here are my thoughts:

On Whether or Not to File a TIGTA Complaint

1.  A TIGTA complaint is a last resort after the IRS representative has discussed the matter with the offending agent and his or her group manager/supervisor.

2.  In the great majority of cases, the dispute is resolved at the supervisory level.

3.  I have had occasion to file several TIGTA complaints and, as far as I know, they triggered neither an investigation of me nor a referral to OPR.

4.  Other than an acknowledgement of the filing of the TIGTA Complaints, I received no responses from TIGTA as to the outcome of its investigations (if, that is, they ever took place.)

5.  Some taxpayer representatives abuse the TIGTA complaint process as a means of intimidating IRS agents.

6.  I believe the filing of a TIGTA complaint is a waste of time and is highly unlikely to result in either an investigation of the alleged misconduct or a correction of that conduct.

7.  I have had much better results with Ms. Nina Olson and the Taxpayer Advocate’s office.

On the IRS’s Respect for a Taxpayer’s Right to Representation

1.  Many IRS agents tell taxpayers not to hire a representative. This is a blatant violation of the taxpayers’ right to representation and any IRS official who does this should be fired.

2.  In my 20 plus years of IRS practice, I have had hundreds of clients tell me that the IRS official they had been dealing with made them believe that if they hired a lawyer it would make matters worse for them, not better.

3.  I have had numerous clients tell me that an IRS official told them that, instead of paying a lawyer or CPA, they should just give the money to the IRS.

4.  The fact that the IRS itself regulates taxpayer representatives (through the Office of Professional Responsibility), diminishes the value of a taxpayer’s right to representation in the same way a criminal defendant’s right to counsel would be emasculated had the State Attorney’s Office been charged with regulating criminal defense attorneys.

5.  I have had many IRS agents and auditors abuse their power and by-pass my power of attorney in order to speak directly with a client.

6.  It is my experience that many (not most) IRS agents and auditors feel intimidated by the presence of an attorney or CPA in the audit or collection process. This makes some sense because in 99% of the cases an Attorney or CPA representative has more training, more knowledge and more experience in the areas of tax law and IRS procedure.

7.  As a result of this knowledge/experience gap, many IRS agents and auditors begin with an adversarial stance towards the representative. This attitude alone greatly diminishes the taxpayer’s right to representation.

More on the Kenny Case

Kenny’s lawyer, Kevin Thorn, who once worked for the OPR said this:

Tax practitioners should sit up and take notice of this. There seems to be a connection between Kenny’s filing of a TIGTA complaint and the OPR complaint against him.

According to the article cited by Paul Caron, New Jersey tax lawyer Dennis Haase said,

I have had clients come to me and say the IRS told them “you don’t need someone to represent you, you only need to produce the records.”

And Barton Goodeve, a New Hampshire CPA, said this about the alleged IRS retaliation against Mr. Kenny,

We find it chilling. We find it scary.

Treasury Secretary Geithner Guilty of Worse Tax Violations than Mr. Kenny

In Shakespeare’s play Measure for Measure, Lord Angelo passes a death sentence on Claudio for engaging in pre-marital sex. When Claudio’s sister, the nun Isabella, comes to plea for her brother’s life, Angelo tries to seduce her thereby committing the same crime for which he has condemned Claudio.

Timothy Geithner is the new Treasury Secretary and, as such, oversees the Internal Revenue Service, a division of the Treasury Department.

A component of the OPR’s charges against Kenny are that he failed to timely file his federal income tax returns for 2001 and 2005 (he later, voluntarily filed them long before the OPR investigation began).

If Mr. Kenny is banned from practicing before the IRS because of his untimely filed returns**, Mr. Geithner should forthwith resign as Treasury Secretary.

**There is no allegation that the returns, once they were filed by Mr. Kenny, were incorrect. The same cannot be said for Mr. Geithner.

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