When you find yourself in a dispute with the IRS, not having an experienced tax attorney who specializes in tax controversy to represent you can have devastating consequences.
As an example, a taxpayer owing the IRS approximately $400,000 was contacted by an IRS Revenue Officer just months before the statute of limitations on collections was about to expire. When the statute expires, the IRS can no longer collect the debt from this taxpayer. The Revenue Officer sent the taxpayer a letter, requesting that he liquidate his IRA and pay the funds (approximately $200,000) to the IRS.
If the taxpayer did not have a tax controversy attorney representing him, he may have liquidated the account and paid it to the IRS, not knowing any better (and out of fear). However, he hired experienced tax controversy counsel, who was able to show that based on the taxpayer’s circumstances, he would need the IRA funds in the future. And the IRS agreed to leave the IRA alone, looking to other options to collect the debt.
By simply hiring a tax controversy attorney, this taxpayer saved himself from depleting all of his retirement funds. No doubt, the cost of a tax attorney was worth it.
In some cases, not having an experienced attorney representing you can have more than just monetary consequences. Missteps along the way—by a taxpayer or an inexperienced attorney or CPA—can be irreversible and end up costing a taxpayer a lot more money in the end, or worse, can have criminal consequences.