Low Income Taxpayer Clinic Students and Faculty Ensure Clients’ Rights Are Protected in IRS Disputes

All taxpayers have the right to retain representation, to challenge the Internal Revenue Service (IRS) when necessary, to have their positions heard, and to pay no more than their correct amount of tax. Unfortunately, many cannot afford these basic rights. 

By Judy Uelk 

Dealing with the IRS can be scary and confusing for anyone, but for those without the means to attain proper legal representation when addressing a tax issue, “scary” can become “horrific” or life-changing. While the U.S. tax system is meant to be fair, often it just isn’t for many low income taxpayers.

Last year, a Low Income Taxpayer Clinic (LITC) was formed at Washington University School of Law to address this problem. The clinic is co-directed by Adjunct Professors Sarah Narkiewicz, JD ’97 and Steven LaBounty, with the assistance of Supervising Attorney, Eunkyong Choi, JD ’96, LLM Tax ’98.

Taxpayers have the right to a fair and just tax system, and “St. Louis was one of the only major metropolitan areas in the United States that did not have a Low Income Taxpayer Clinic,” Narkiewicz says. “Taxpayers who needed assistance with their tax issues were instead referred to Villanova, in Philadelphia. While Villanova did their best to help these clients remotely, they could not appear for them in Tax Court and had limited capacity to help them.

“Since we opened in August, we have seen just how great the need is for these kinds of services in our community,” she adds. “We have gone from having no clients to operating at full capacity with a lengthy waiting list. The impact of our services on the lives of our clients is substantial. We are trying to give these clients a ‘fresh start,’ easing their economic burdens, and in many cases allowing them to once again be productive, tax-paying citizens.”

Clinic faculty and students also monitor issues affecting multiple taxpayers. The clinic advocates on their behalf to ensure all taxpayers have a voice and to draw attention to taxpayers receiving unfair treatment from the IRS.

According to the IRS, the number of low income people in the United States has grown substantially in recent years. In 2013, nearly 133 million people residing in the United States had incomes below 250 percent of the federal poverty level, an increase of nearly 16 million since 2007.

Low income taxpayers work in a variety of professions and possess diverse characteristics in ethnicity, family status, living arrangements, and age. However, the defining characteristic of this population – scarcity of resources – brings with it many hardships that present distinctive challenges for tax administration. These include limited English proficiency, low literacy rates, physical or mental disabilities, lower education levels, unstable job prospects, substandard housing, lack of affordable child care, unreliable transportation, limited access to banks, and lack of access to competent and affordable tax return preparation services. Offering free or affordable direct representation to eligible low income taxpayers in disputes with the IRS is one of the best ways that low income taxpayer clinics defend taxpayer rights. 

The Low Income Taxpayer Clinic provides students with the opportunity to help these low income taxpayers, as they develop lawyering skills working as student attorneys under faculty supervision on tax-related legal issues.

“The students get hands-on experience,” Choi says, “and are able to see just how rewarding it is to help low income clients and make a real difference in their lives.”

Recent graduate Jackie Roeing found her experience with the clinic extremely valuable. “The Low Income Taxpayer Clinic provides an excellent, hands-on approach to learning about the real issues that affect taxpayers,” she says. “Moving beyond the sometimes abstract ideas in doctrinal tax courses, the clinic supports students as they direct their own cases.”

From the first week, Roeing says she worked directly with clients and the IRS, drafted settlement offers, and collaborated with classmates to tackle challenging cases. “The clinic has allowed me to provide meaningful legal representation, while greatly expanding my knowledge of tax controversy,” she says.

Although relatively new, the law school’s Low Income Taxpayer Clinic has already seen great results. One such story involves a successful businesswoman and homeowner, who, because of emotional and physical disabilities, was left homeless and unable to pay her taxes. The clinic was able to stop the levy process for her and settle her tax debt for a considerably lower amount than she owed.

The clinic has also helped clients who have been the victims of identity theft. “Most often those who steal identities prey on older people with a low income,” Choi observes. “They use their social security number to obtain a tax ID number and commit fraud.”

Additionally, the clinic can assist clients with taxpayer scams. “We are currently working with an immigrant who, unfortunately filed his tax return with a disreputable tax preparer who took off with his refund,” Choi says.

“Tax preparer fraud cases are extremely difficult,” Narkiewicz adds, “since the IRS has already paid the refund once to the tax preparer and doesn’t want to pay again.”

The clinic’s co-directors and supervising attorney each brings a wealth of expertise. Narkiewicz has been a lecturer in law and advisor in the tax LLM program since 2004, teaching tax courses as well as supervising the externship program for the LLM students. She also taught taxation at Saint Louis University’s School of Business for six years and was a tax attorney for six years with Husch Blackwell and The Stolar Partnership. She worked as a tax consultant with PricewaterhouseCoopers before law school.

LaBounty recently retired after 30 years with the IRS in the Office of Chief Counsel in St. Louis. He has taught for eight years as an adjunct professor in the law school’s tax LLM program and regularly supervised extern students in their work with his office at the IRS. His career with the IRS included his role as Special Assistant U.S. Attorney and representative of the IRS before the Bankruptcy Court for the Eastern District of Missouri.

Choi is a business-oriented attorney with diverse experience in developing and delivering complex tax planning strategies. Before joining the law school, she was the program director and supervising attorney for Nevada Legal Services—LITC program. She recently was appointed to a three-year term on the Internal Revenue Service Advisory Council.

“Tax controversy is like solving a puzzle,” Choi says. “I really enjoy that part of it, and of course, helping low income individuals secure their right to representation with the IRS and achieve successful outcomes is very rewarding.”

Narkiewicz agrees. “Working with the clients and the students in the clinic is extremely gratifying,” she says. “And, it can really ignite a passion in our students to practice tax law. Once they get into it, they see how rewarding it can be and the importance of this type of work for lower income people. We have even had students who were in our fall clinic come back in the spring to volunteer as tax preparers. They get how important this is.”

Recent graduate Chris Moran couldn’t agree more. “My work in the clinic gave me experience in client counseling, case management, and the intricacies of federal tax law,” he says.

“One case I worked on involved a single father who claimed the Earned Income Credit for his daughter and three relatives. After an audit, the IRS disallowed his deductions, and he was left with a large tax bill that he couldn’t afford to pay,” Moran recalls.

Ultimately, Moran was able to prepare a settlement offer for his client that allowed him to repay the debt in one affordable lump sum out of his monthly budget. “Analyzing complicated tax issues like this and finding workable solutions for my clients really motivated me to pursue a tax career,” says Moran, who plans to join a small tax firm in Baltimore.

Summer 2015