When Dealing with the IRS, Proceed with Caution

When Dealing with the IRS, Proceed with Caution

We have long advised our clients that, when dealing with the IRS, proceed with caution. This message was furthered by an article that appeared in the Wall Street Journal, titled “IRS Faulted for Prosecuting Confessed Evaders of Taxes” (May 5, 2010).

The article concerns a group of taxpayers who voluntarily disclosed to the IRS the existence of their undeclared foreign bank accounts, and are now being prosecuted for criminal tax fraud. Under the official IRS Voluntary Disclosure Program (VDP), which was announced in March 2009 and expired on October 15, 2009, there was an “understanding” that people who came forward and disclosed would avoid criminal charges. (“Understanding”, as contrasted with “guarantee”; the IRS made no guarantees of non-prosecution.) The taxpayers discussed in the article, however, came forward in 2008 and early 2009, before the existence of the official VDP. In other words, they came forward too early, and the IRS was not bound by the “understanding” not to prosecute criminally.

We’ve written elsewhere about the IRS agreeing to settlement terms, and then a new IRS agent reneging on the terms agreed to by his predecessor agent.

When up against the IRS, it is crucial to have attorneys on your side who are aggressive in protecting your rights, and who will fight on your behalf.

As the Wall Street Journal guides, “Having a smart, well-prepared tax expert on your side can be a tremendous advantage. Not only will they know the ins and outs of the tax code, but also they can take over the often-exhausting job of dealing with the IRS – and help you decide how far to push a fight.” (Wall Street Journal, “How to Fight the IRS”, April 13, 2010)

The attorneys at Rubinstein & Rubinstein, LLP have extensive experience with the I.R.S. We have led many clients through tax audits, tax challenges and voluntary disclosures. We have successfully represented and defended numerous clients against the I.R.S. and negotiated favorable settlements with the I.R.S. We zealously protect our clients, and their interests and rights, when challenged by the IRS. At the same time, we have excellent relationships with the IRS agents with whom we interact. While cordial and professional, we are strategic and aggressive when necessary. We have a successful track record against the IRS on behalf of our tax clients.

Please contact us if you have been contacted by the I.R.S. regarding a request for information, an audit, a notice of tax due, or have any other issues relating to taxation.