The Best Kept Secret...
Few people are aware that there is a way for a person with training in tax preparation, tax accounting, or the general practice of law to become expert in tax matters. After passing a 4-hour exam and an FBI background check, that person would be permitted to "represent" taxpayers before a Federal specialty court responsible for handling tax controversies of US or foreign citizens and the IRS. Such persons are known as "United States Tax Court Practitioners" and they enjoy the same privileges that a State-licensed attorney does when engaged in the general practice of law before a Federal or State tribunal to which they are admitted. But those privileges are exclusive ONLY to the United States Tax Court.
What's even more fascinating is that US Tax Court Practitioners may practice in any State in the United States and its territories, or wherever the Tax Court holds session. This means that unlike a person who attends a State-certified law school, then sits for a State bar exam and becomes licensed to practice law within the respective State (jurisdiction) that issues the license, the United States Tax Court Practitioner can accept a tax case in Oregon today, and another in Florida tomorrow because that person has the right to practice his profession anywhere within the national jurisdiction. Their only restriction is to be sure he/she can appear to represent their client at the time and place of the tax trial. If it's a small tax case, the Practitioner may not need to appear in Court because the Tax Court can resolve those types of cases administratively and report the results electronically. The point being, that the US Tax Court Practitioner can practice Federal tax litigation (resolve tax controversies) in a national jurisdiction and not have to spend tens of thousands of dollars to obtain a licensed to do so.
Most importantly, the cost in time and money to become an US Tax Court Practitioner is a fraction of what individuals spend to attend a traditional 3-year law school program (4 years in California, in some cases). A top IRS-approved training program (Federal bar admissions preparation), like the one I present, costs about $20,000-$25,000 to complete all of the required preparatory courses. But that's all! And although one does have to concern one's self with traveling somewhere to attend live sessions for at least a small part of the time, the bulk of the program is virtual and presented only on weekends, so you can maintain a full-time job and still have a life. All you need is a mobile device that provides high-speed access to the Internet and unlimited e-mail. All of the study materials are transmitted electronically, except for several soft covered texts that will be mailed to you directly from the publishers. And everything is included in the initial and only fee you pay for the Program - Law School hosted Opening Session, Virtual Lectures, and Washington DC Live Pre-Exam Review.
The average income for an USTCP, working full-time, in 2018 was approximately $90,000-$120,000. Seasoned USTCP, and those with CPA credentials practicing in both the domestic and international areas of the US Tax Court litigation are reported to be earning upwards of $200,000-$250,000 annually.
Updated: April 2019
The preceding article was prepared by Michael J. Stuart for returning US Army veterans
Gateway to Tax Court Practice
I am continually amazed that such a small percentage of accountants and tax professionals are striving for or have even become aware of the “United States Tax Court Exam.” Completion of this exam provides a professional with a license to represent an individual or corporate taxpayer in the US Tax Court in a capacity similar to a tax attorney. The designation is referred to as “USTCP” which is an acronym for “United States Tax Court Practitioner.”
The significant opportunity is that the accounting and/or tax professional can achieve this accomplishment without going to law school for three years. In order to attend law school for a normal three-year term, there are significant out-of-pocket costs; also, the opportunity costs of not working while attending classes must be considered [not to mention the strict admissions criteria to get into a good state bar approved program].
The USTCP achievement is accomplished by preparing for and completing a four-hour bar exam that is given every other year in November, at the United States Tax Court building in Washington, DC The next exam will be in November of 2014, so you can start getting your goals in mind and begin preparation and establishing a plan for completion.
⋄ Accounting firms that might want to sponsor a key partner or employee for it.
⋄ College business students interested in accounting and taxes that might want to view the path of the USTCP as an alternative to going to law school to enhance their level of expertise.
⋄ Tax resolution firms which mainly resolve conflicts with the IRS that might encourage an employee or principal to consider it.
⋄ A sole proprietor or small firm that might may want it to gain a competitive edge.
I hope that college business professors, accounting firm partners, tax resolution firms and the various professional organizations get the word out to their associates, partners, employees and members that there is an opportunity available such as the USTCP.
Please understand that with the USTCP, the successful candidate cannot use the lawyer or attorney title, but once an individual passes the exam and is admitted to practice before the United States Tax Court, they get assigned a bar number just like an attorney.
Also, the USTCP cannot practice law similar to an attorney preparing wills or contracts; the only venue where a USTCP can represent a client/taxpayer in a legal capacity is in a controversy with the IRS in the United States Tax Court and providing advice during the controversy.
Further, it should be mentioned that the majority of Tax Court cases are settled before they go to trial. More than 90 percent of the cases never go to trial; however, you must be prepared in the event a settlement is not reached.
Contents of the exam
The contents of the exam are clearly spelled out at www.ustaxcourt.gov as follows: “The examination consists of the following four parts and is designed to test the applicant’s knowledge of these subject areas:
(1) Tax Court Rules of Practice and Procedure.
(2) Federal Taxation.
(3) Federal Rules of Evidence.
(4) Legal ethics, including the Model Rules of Professional Conduct of the American Bar Association.
Four hours will be allowed for the test. To pass, the applicant must demonstrate proficiency in each subject area by obtaining a score of 70 percent or greater on each of the exam’s four parts.
The real back breaker of the exam is Part 3, titled Federal Rules of Evidence. It is necessary to be familiar with the rules and be able to cite such rules from memory as there are no reference materials available during the actual exam for this section. Further, one must be able to apply the rules to a typical tax court trial and related questions about the admission of evidence, objections and procedures in court.
Books are provided to assist the applicant during the exam for each of the other three parts, but for the Part 3, you must work from memory and apply it in a case situation.
Legal Ethics and Tax Court Rules of Practice and Procedure are fairly straightforward and basically open book. The Federal Income Tax portion is the longest part and covers a broad base of information making it the second most difficult part.
The exam costs $75 to be paid with the application and you have to get to the Tax Court building in Washington, DC, to take it. Further, it is necessary to purchase various text books on legal evidence and consider a review course. The next exam is in November 2014. The United States Tax Court will announce the date and begin accepting applications approximately six months before the exam.
In 2008, approximately 75 individuals took the exam and eight individuals were successful. The pass rate over the last decade has been between 5 percent and 10 percent.