Costs, Benefits of Representing Yourself in Tax Court

* Although Liz Pulliam’s “IRS Dispute? You Probably Can’t Afford to Forgo Professional Help” [Money Talk, Nov. 29] is certainly good advice, I thought it might be worthwhile for you to be aware of the provisions contained in IRS Section 7463.

These provisions are the rough equivalent of a “small claims court” for Tax Court proceedings. If the amount in dispute for any year is $50,000 or less (this threshold was $10,000 until it was recently changed as part of the IRS Restructuring and Reform Act of 1998), Tax Court offers a forum which is much more user-friendly than the normally complex one that applies to the litigation of tax disputes.

For example, the normal federal rules of evidence that apply to most Tax Court proceedings generally do not apply to these “S” cases. Also no “discovery”--depositions, interrogatories, requests for admissions, etc.--is permitted. In my experience while working at the IRS (as a special assistant U.S. attorney) in trying several of these cases, Tax Court judges tend to be a little more lenient with taxpayers representing themselves in these proceedings.

The bottom line is, it may not be as burdensome, expensive and bewildering to take one of these cases to trial as a taxpayer thinks.

There is also a service provided by the Beverly Hills Bar Assn. in which tax lawyers show up at Tax Court when the cases are being set for trial to counsel taxpayers who are representing themselves. This service is provided for free.

JEFF DAVINE

Tax attorney

West Hills

* As a tax practitioner for over 18 years, what I’ve discovered is that until the taxpayer retains professional help, the IRS will berate, intimidate, insult and otherwise “beat up” the taxpayer.

Why is this? All day long the taxpayer is telling the IRS that they will do certain things the IRS has requested of them, and 90% of the time the taxpayer doesn’t follow through or isn’t that serious about resolving the issue.

As soon as the taxpayer retains a CPA or attorney, the IRS backs down and their attitude takes a 180-degree turn for the better. They realize the taxpayer is very serious about resolving the dispute. They also realize that most expert IRS problem solvers know the ins and outs of mediating a successful conclusion to these types of difficulties.

MICHAEL A. ROZBRUCH, CPA

Tarzana

* You’re absolutely right when you say that the people cannot afford to not have an accountant involved. There are several ways that can be done, some of them not enormously expensive.

For example, a CPA does not have to meet with the IRS auditor if the audit issues are minor. The CPA could just discuss the case with the auditor and let them know a professional is monitoring the situation closely. Examiners under those circumstances are less likely to abuse the situation.

The CPA would also counsel the taxpayer in what to say and what not to say.

I disagree with your last piece of advice about checking with law schools. If a case is headed for Tax Court, an experienced tax attorney is usually needed. However, even then an experienced CPA could help the taxpayer file a protest to Tax Court.

GARY M. BARNBAUM, CPA

Woodland Hills