Why use experts

Engaging experts in a tax appeal can change both process and outcome. Experts translate complex records into convincing, admissible evidence; they identify legal and factual weaknesses in the IRS position; and they negotiate with appeals officers who expect credible, well-documented support. For IRS guidance on appeals, see the IRS Office of Appeals overview (irs.gov/appeals).

Types of experts and what they do

  • Tax attorney: Handles legal strategy, court filings, and complex legal arguments. Advisable when legal interpretation or litigation risk exists.
  • Certified Public Accountant (CPA): Provides forensic analysis of returns, prepares corrected returns or schedules, and produces financial workpapers.
  • Enrolled Agent (EA): Federally authorized to represent taxpayers before the IRS and often a cost-effective alternative for audit and appeals representation.
  • Valuation or business appraiser: Prepares valuation reports for disputed asset values, basis, or purchase-price allocations.
  • Forensic accountant: Reconstructs records, traces transactions, and prepares reconciliations when records are incomplete.
  • Expert witness: Offers opinion testimony in Tax Court or depositions where technical or industry standards matter (see Using Expert Witnesses in Tax Court Appeals).

Choosing the right expert

  • Match experience to the issue: Prior appeals or Tax Court experience matters more than a generic tax practice. Ask for examples (redacted) of similar wins.
  • Verify credentials and standing: Check state bar for attorneys, state board for CPAs, and IRS enrollment for EAs.
  • Understand fee structure: Hourly vs. flat fee, retainer requirements, and who covers expert-report costs. Get engagement terms in writing.
  • Check conflicts and availability: Appeals timelines move; confirm the expert can meet deadlines and attend conferences or hearings.

How to engage and manage experts

  1. Define scope in writing: State the specific tasks (analysis, report, representation, testimony), deliverables, deadlines, and billing rules.
  2. Grant representation properly: Use IRS Form 2848, Power of Attorney and Declaration of Representative, when someone will act for you before the IRS (irs.gov/forms-pubs/about-form-2848).
  3. Provide a clear document package: Organize returns, bank statements, invoices, contracts, and prior IRS correspondence. Label exhibits and include a concise chronology of facts.
  4. Ask for a written memo or exhibit list: A short expert report or affidavit clarifies opinions and the facts relied upon—useful at an appeals conference and later if the matter goes to Tax Court.
  5. Communicate strategy: Decide whether to focus on settlement, partial concessions, penalty abatement, or preparing for litigation.

Practical tips for appeals conferences

  • Start early and be cooperative: Appeals favors settlement where the facts and law support it. Present a concise, professional file and a one- to two-page summary of your position.
  • Keep experts available: The appeals officer may request a technical call or supplemental report.
  • Use neutral experts carefully: Independent appraisal or valuation reports are often more persuasive than party-prepared analyses.

Common mistakes to avoid

  • Hiring based on price alone: Low cost can mean limited appeals experience or under-prepared reports.
  • Vague engagement terms: Without a clear scope the expert may not produce the needed deliverables on time.
  • Late involvement: Experts brought in after a case is effectively closed (e.g., after an initial denial with no new facts) have limited value.

Cost considerations and alternatives

Expert fees vary widely: a CPA or EA for appeals work may be modest; valuation reports or expert witnesses can be costly. For lower-cost representation consider an experienced EA or a CPA with appeals background. Weigh cost vs. potential tax savings and penalties avoided.

Checklist before an appeals conference

  • Signed engagement letter and, if needed, Form 2848 in place.
  • Organized exhibits and a one-page chronology.
  • Expert memo, valuation report, or reconstructions ready.
  • Clear negotiation authority from the client: minimum acceptable outcome, walk-away points, and whether to request penalty relief or installment options.

When expert testimony matters

If the dispute will likely progress to Tax Court or needs contested factual determinations (e.g., business valuation, fair market value, or lost profits), an expert who can survive Daubert/Daubert-like scrutiny and provide a clear, well-documented report is essential. Coordinate expert reports early so they meet court rules and evidentiary standards.

Authoritative references

Internal resources on FinHelp.io

Professional disclaimer

This article is educational and does not constitute legal or tax advice. For guidance tailored to your circumstances, consult a qualified tax attorney, CPA, or enrolled agent.

In-practice note

In my experience working with taxpayers and appeals officers, a focused expert report and a one-page chronology usually do more to settle an appeal than long, unfocused disclosures. Start early, control scope, and document what you expect the expert to prove.