Coping With Income Tax Jitters : An Expert Offers Clues on How to Survive April 15 Panic

When the Internal Revenue Service unveiled its TV ad about the taxpayer stalked by his 1040 form, it tacitly admitted what everyone already knew: filing a tax return can be terrifying.

With the April 15 deadline closing in fast, tax phobia is rampant. Joyce Rebhun of Los Angeles is familiar with the symptoms, like depression and paranoia. In most cases, she prescribes a healthy dose of information and a shot of confidence. Sometimes, she steps in and intervenes.

Rebhun is a $200-an-hour income tax therapist. She has all the right credentials--a 20-year tax attorney who has worked for the IRS, a certified public accountant with a doctorate in tax history--and something more: a determination to salvage the lives of people she calls “tax victims.”

“People come to me, not so much for tax ‘therapy’ but for tax ‘rescue,’ ” she says.

‘Depths of Despair’

“I help people who are burnt-out, who have gone into hiding because of their tax problems. I don’t think we know the depths of despair some people have.”

Over the last three years, Rebhun has counseled nearly 1,800 delinquent or problem tax filers, most of them well-educated and well-heeled.

She’s gotten desperate calls in the middle of the night from physicians thrashing around in divorce webs, foreign entrepreneurs with U.S. holdings who didn’t know they had to pay Uncle Sam, absent-minded professors who put their 1040s in desk drawers and forgot about them.

Many of her clients have not filed tax returns for 10 or more years, Rebhun reports, and at least two are 35 years in arrears.

Not Tax Evaders

But none of her people are tax evaders, she insists. “I screen out people who have been dishonest. The only thing I have going for me with the IRS is my credibility, so I won’t go in with a crook.”

The root of tax phobia, Rebhun says, is insecurity stemming from ignorance. “We’re forced to cope with a form that we don’t understand and that changes from year to year. It can make you feel terribly afraid.”

Cash flow problems also add to tax woes, she says. “People are not living within their means. Very often, they’re desperate for cash so they claim too many exemptions and don’t have enough money taken out of their paychecks.”

Many of Rebhun’s clients are victims of inept tax preparers, like the business professor who never examined his return and didn’t know his preparer had counted his university income twice.

And, of the 10 to 15 new clients she accepts each week, Rebhun says six to eight “come in with the same story: They’re men who have been devastated by divorce and who can’t get their ex-wives to turn over financial records so they can straighten out their returns.”

Whatever their circumstances are, tax victims have the same immediate challenge, says Rebhun--they have to get over their paralysis and take action. Which is where she comes in.

The Direct Approach

Rebhun’s course of therapy starts with a direct appeal to the IRS for leniency and more time. “I pick up the phone and call, or make a personal visit, and I say, ‘Look, I have somebody here who’s in real trouble.’

“And they always respond. All of my success stories have come about because of the kindness of the IRS.”

Kindness? The IRS?

“You have to remember,” Rebhun says, “that you’re talking to another human being. They’re not devoid of emotion.”

Once the IRS agrees to delay the scheduled action, be it an audit or a levy on wages or property, Rebhun’s next step is to prod the tax victim out of his or her stupor.

“I must be firm with them,” she says. “They have to help themselves. We make a list of the things they have to do, like go to the bank and get back copies of statements.”

Most tax victims only need a little prodding, she says. “When they see me take over, they shake off their depression and become more confident. Sometimes I see a complete change of personality.”

Rebhun’s advice to people now suffering the mid-April jitters is to “read manuals and try to help yourself. When we get thrown by something, it’s usually because we don’t have enough information to feel confident and ask questions.”

To avoid stress and shock down the road, she says, bone up now on changes in the tax laws, especially in the amount of itemized deductions that can be taken.

“That’s going to make a huge difference, especially to people in the middle-income tax rates but with all the changes, you’re going to come out with fewer deductions.”

And never assume that sheer intelligence or expertise in any other field will come in handy in the psychic jungle of income tax filing. Rebhun says that some of her most accomplished clients “have a mental block about taxes because they’re intimidated.”

She should know; it happened to her. When she got a notice that the IRS wanted to audit her 1983 tax return, Rebhun recalls, she hit the panic button.

“I had nightmares that I lost all my records--and I keep meticulous records. Finally, I said to myself, ‘You’re in the system; you have to deal with this like everybody else.’ ”