Tax Controversy Practice

A Tax Lawyer’s Knowledge, A Litigator’s Mindset

The firm’s primary area of practice is its tax controversy practice.

Federal Tax Practice. Representing taxpayers who have disputes with the federal government is a significant focus of the firm’s practice. In these matters, Jim Malone brings tax knowledge and litigation experience to the taxpayer’s case.

The types of engagements that the firm is prepared to handle include the following:
• Audit Defense. The primary client representative for the audit should normally be the accountant who worked with the client on the returns. There are two exceptions: where the relationship has broken down, and where criminal responsibility may be an issue. Even in a normal audit, however, it can be helpful to get legal advice, and Jim is available to work with the client’s accountant to provide whatever assistance may be needed.
• Administrative Appeals. Upon completion of an audit, clients have the option to file an administrative appeal with the IRS or proceed to litigation. This is a critical decision, as a fruitful administrative appeal may lead to a settlement, but an unsuccessful appeal may simply provide the government with a better record in subsequent litigation.
• Deficiency Actions. Following conclusion of an audit, the IRS will issue a deficiency notice and the taxpayer is free to petition the United States Tax Court to challenge the administrative determination of the tax due. Jim Malone is a member of the Tax Court bar and is prepared to handle deficiency actions either directly following the conclusion of an audit or following an administrative appeal. Because the Tax Court’s jurisdiction is nation-wide, Jim can represent taxpayers from across the country.
• Refund Actions. Some cases fall outside the Tax Court’s jurisdiction. Trust fund recovery penalty cases against business owners who are behind on payroll taxes are one example. In other situations, there may be tactical reasons for proceeding with a refund action rather than pursuing a petition to the Tax Court. These cases proceed either before the Court of Federal Claims (which can hear cases from anywhere in the country) or before U.S. District Courts, and Jim is prepared to work with taxpayers on refund matters.
• Collection Cases. Taxpayers who are the subject of IRS collection activity have rights and administrative remedies that are governed by the procedural standards of the Internal Revenue Code and related regulations. Jim is experienced in representing taxpayers in large collection cases, including lien and levy matters.
• Non-filers. For individuals, collection cases frequently arise due to a failure to file tax returns over a number of years. Jim has experience helping chronic non-filers get into compliance and is experienced in working out payment arrangements in situations where the taxpayer cannot currently pay in full.

State and Local Tax Practice. The firm also represents taxpayers who are involved in state or local tax disputes. Typically, these matters focus on business tax issues in the City of Philadelphia and surrounding suburban municipalities.

While many tax lawyers and accountants are unfamiliar with this area, Jim is well-versed in the basic principles governing state and local taxation in the Commonwealth of Pennsylvania, and he is available to consult with accountants and attorneys who have issues in this area.
Critical to this particular area is a careful attention to procedure: taxpayers can lose substantial rights if they do not promptly respond to audit notices.
Jim is prepared to work on state and local tax matters in Pennsylvania at any stage from audit up to and including litigation.