What options does my client have after tax court?

[Jack from Ohio]

Background:

Client was audited for 04,05, 06, & 07. Started with 04, and then went forward after disallowing things on the 04 return. The auditor took a very poor attitude and disallowed many things that we provided documentation for in follow-up interviews. (We did not do the returns)

Client dallied around after receiving the final audit reports till the allowable time to file for appeal had passed.

Client filed with tax court hoping the court would send it back to appeals because of the nature of the items in question.

The court (on April 15, 2009) denied consideration of the case and said:

"WHEREFORE, it is prayed that the relief sought in the petition be denied and that the respondent's determination, as set forth in the notices of deficiency, be in all respects approved."

Question:

Does my client have any other options?

[jainen]

>>any other options? <<

We all love the underdog, so you can expect a lot of answers to this question. Perhaps the court based its opinion on some basic legal principle that seemed so overwhelming that it wasn't even necessary to hear the actual facts. Perhaps that principle was so basic it is simply called "the Statute," that if this was so important why didn't he bring it up before now?

There is always another lawyer to take another opinion to another court, the only qualifier being payment of a fee. But judges tend to think alike, so further appeals are uncertain. In my opinion, it is time to look at all the options for dealing with Collections.

[Jack from Ohio]

>>any other options? <<

We all love the underdog, so you can expect a lot of answers to this question. Perhaps the court based its opinion on some basic legal principle that seemed so overwhelming that it wasn't even necessary to hear the actual facts. Perhaps that principle was so basic it is simply called "the Statute," that if this was so important why didn't he bring it up before now?

There is always another lawyer to take another opinion to another court, the only qualifier being payment of a fee. But judges tend to think alike, so further appeals are uncertain. In my opinion, it is time to look at all the options for dealing with Collections.

Jainen, your answer echos my thoughts but before I committ my self to an answer, I wanted to tap every resource available.

[jainen]

>>I wanted to tap every resource available.<<

Well, as I said, "There is always another lawyer." The problem is that from here on down it gets expensive pretty fast, and your client might not exactly want you to tap "every resource available," if you know what I mean. He might need some of those resources to get his act together again.

One of the most obvious paths (which I am sure he will ask about) is an Offer in Compromise based on doubt as to liability. Unfortunately, his ill-timed run at the court system has locked out any doubt forever, legally speaking. Really, the only thing still in doubt is on what terms he can settle the bill.

Another path (which I am sure he will NOT ask about) is whatever results from his degraded opinion of the tax system. He probably feels somewhat cheated by being singled out for examination and then not even getting his day in court.

[jainen]

>>the only thing still in doubt is on what terms he can settle the bill<<

[i guess I was wrong about all the answers I expected.] I don't mean he has used up all his options. Now he has many MORE paths to resolution than before. These include major categories of compromise, installment payments, tax liens, non-collectible status, bankruptcy, and perhaps a few others, all with lots of variation and ways to customize the deal. He no longer has to argue tax law (which apparently he wasn't very good at anyway), and can just focus on how much he can afford.

If he cooperates he will find IRS Collections surprisingly fair and accommodating. Of course, that means honestly revealing his assets, but he can probably drag the process out indefinitely while he rebuilds other opportunities. It won't be comfortable but it need not be painful.