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Tax Litigation

If you have a tax dispute with the IRS, you need the IRS to know that you are well-represented, and that you will not be trampled on. Brandon Keim has the experience to resolve a broad range of tax matters efficiently through the administrative process, but when that fails, and the IRS does not treat you fairly, Brandon will take the IRS to court on your behalf. While at the IRS, Brandon received the Chief Counsel National Award for Superior Achievement in Outstanding Litigation. You can learn more about Brandon's tax litigation experience by reviewing his case results here.

Should you litigate?

Generally, tax matters are most efficiently resolved through the administrative process. Having a competent tax controversy attorney with former IRS experience represent you during the administrative process (the audit, and appeal) may help you obtain the best result. Often times, taxpayers prefer to handle matters themselves, or rely on accountants that do not have the experience of a tax controversy attorney, in an effort to save costs. Unfortunately, taxpayers and their accountants are frequently unable to resolve matters themselves, and sometimes they make them worse, and then turn to a tax controversy attorney. If the taxpayer had engaged the tax controversy attorney in the beginning, they may have changed the result earlier on, and saved time and money.

Why is a tax controversy attorney, like Brandon Keim, better suited to handle matters with the IRS? Because if the attorney is experienced, he has likely seen your problem before, he knows the process well, he knows the people involved, and he can help you formulate the best approach to resolving the tax dispute with a large, bureaucratic organization. Perhaps most importantly, an experienced tax controversy attorney comes with the threat of litigation that a taxpayer and accountant generally cannot mimic.

If you tried to resolve the tax dispute administratively and, despite your best efforts, you were unable to do so, either because the IRS was not listening, or because it does not agree with your position, you need to assess whether to litigate the tax dispute. Before you decide to litigate, you should consider the issues involved, the expenses that arise in litigation, your likelihood of success, and whether you can force the IRS or another taxing authority to pay your legal feels if you win. Brandon Keim can help you assess whether litigation is appropriate based on your circumstances.

Where should you litigate?

If you need to pursue litigation as a means of solving your tax problems, you have a number of venues to choose from. Venue selection is an important part of your overall litigation strategy.

Are you able and willing to pay the tax before litigating?

If you are not able or willing to pay the tax before you dispute it, the United States Tax Court is the likely venue to choose because it is the only pre-payment forum. The Court of Federal Claims, and federal district courts require payment before disputing the tax. But, in certain cases, if a tax is a "divisible tax," you may be able to pay a small portion of the proposed liability and litigate in the Court of Federal Claims or federal district courts. 

How does judicial precedent affect your issue?

When choosing a venue, you should consider how it may allow you to avoid unfavorable precedent, and take advantage of favorable precedent. The relevant decisions of the Tax Court, the Court of Federal Claims, the federal district courts, and the court of appeals to which an appeal would lie should be considered when choosing a venue.

The Tax Court will follow the decision of the court of appeals to which an appeal would lie if it has directly answered the question. This is known as the Golsen rule. If there is no authority from the court of appeals, the Tax Court will develop its own position and that may conflict with courts of appeals for other circuits. In contrast to the Tax Court's approach, a federal district court is bound by the precedent of the court of appeals for the circuit in which it is located.

Do you want formal discovery?

The Tax Court has long favored informal discovery, meaning that the parties work together informally to learn the facts and prepare a case for trial, rather than relying on formal rules like those in federal district courts that provide for automatic disclosures, and routine depositions (interviews under oath).

The biggest distinction between discovery in Tax Court and the federal district courts is the availability of depositions. Although the Tax Court has liberalized access over the years, nonconsensual depositions are an extraordinary method of discovery, and party depositions are rarely sought by the government, or granted by the Tax Court. This distinction may be important in choosing a venue that is cost effective because formal discovery can be expensive.

Discovery is a matter of discretion in the Court of Federal Claims.

Do you want a jury trial?

You have a right to demand a jury trial in federal district court, but you have no similar right in Tax Court or in the Court of Federal Claims. This may be an important factor if there are disputed issues of fact.

Are you willing to risk an increased deficiency?

Once the IRS makes its proposed tax determination, there is still a risk that the proposed tax could increase. If you choose to litigate in the Tax Court, the IRS may raise new issues during the litigation because the filing of a petition in the Tax Court suspends the statute of limitations on assessments until a final decision is rendered, plus 60 days.

A suit for refund in federal district court or the Court of Federal Claims does not suspend the running of the statute of limitations. If the taxpayer files a refund suit after the assessment statute of limitations has expired, any deficiencies arising from new issues raised by the government may only be used to offset the taxpayer's refund—they cannot create an unpaid liability.

Trial Preparation

The devil really is in the details when it comes to litigation. Adequate pre-trial preparation is the key to any chance of success. As part of preparation, your attorney will (1) learn all of the facts, both good and bad, (2) survey all of the applicable statutory provisions, case law, and administrative guidance, and (3) develop an appropriate trial strategy.

Pre-trial preparation includes formal and informal discovery, determining whether and to what extent expert witnesses may be necessary to prove your case, evaluating potential fact witnesses, preparing and negotiating comprehensive stipulations of fact and law, preparing trial exhibits, and filing and responding to pre-trial motions.

Post-Trial Briefs

Depending on the venue selected, post-trial briefs may be necessary to argue that the court should find certain facts from the evidence presented at trial, and argue the appropriate application of the law. Post-trial briefs may be hundreds of pages depending on the factual and legal issues, and the judge's preferences.

Appeal Consideration

The trial court's opinion is not the end. Depending on the result, you may consider an appeal of factual or legal findings, and the government may do the same.

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The act of visiting or communicating with Brandon A. Keim via this website or by email does not constitute an attorney-client relationship. Communications from non-clients via this website are not subject to client confidentiality or attorney-client privilege. Further, the articles, discussion, commentary, forms and sample documentation contained in this website are offered as general guidance only and are not to be relied upon as specific legal advice. For legal advice on a specific matter, please consult with an attorney who is knowledgeable and experienced in that area. Attorneys listed in this website practice only in the jurisdictions in which they are admitted. This website is governed by the Arizona Rules of Professional Conduct.

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