Explaining tax law to real people
This is another in my periodic posts for young tax lawyers. These are things that I was taught or learned by trial and error. I hope they are useful to young tax practitioners.
If you want to be a tax lawyer, you need to think in logic chains. If A, then B. B, therefore C. That is because tax law is a giant rule-based game.
Once you have parsed the rules, you need to explain your conclusion to other people. Your client is the first of these people. After all, the conclusion you reach affects the client intimately — in the wallet. Remember that your client is a lay person. You’re part of the priesthood. You must be able to explain your conclusion to the client in a way that he or she understands. No jargon. No short-hand references to Code sections.
This means two things. First, you have to be clear in your thinking. You need to understand the law thoroughly. Then you need to be able to explain it simply and clearly. I have seen to many letters and research memoranda that are obtuse to me — an experienced practitioner with a Masters degree in Tax law. That is simply unacceptable. Your job is over when the client understands what you’re doing, and why.
I will throw in another shameless plug for Bryan Garner and his seminars.
Writing well involves two skills. One is the writing part. Use simple sentences. Use short words. Make your paragraphs small so your reader can pull out the key point of that paragraph and carry that idea to the next paragraph. I think most lawyers write as if they are heaving bricks over a wall. They do not consider the reader. Your job in writing something is to require no thought whatsoever from the reader, if you can. Everything is there, self-contained.
If you’re writing for your boss (who is a tax lawyer), one great place to start is with Writing Tax Research Memos. This helps you understand what you’re doing and why. Your job is to make is as easy as possible for the reader (your boss) to understand what you have concluded.
The second skill is something I tell everyone and they all ignore me. Pay f-ing attention to the aesthetics of your document. If you write using Microsoft Word, and you have “Normal” style anywhere in the document, you’re doing it wrong. If you hit the Enter key twice to make a space between paragraphs, you’re doing it wrong. If you have a giant mishmash of fonts in your document, you’re doing it wrong.
A clean layout will guide the reader at every stage. Use plenty of headings. I use headings liberally. My goal (not always achieved) is to make my document understandable if the only thing you read is the headings.
Use styles, Grasshopper.
In his seminars, Bryan Garner will tell you about layouts, headings, numbered paragraphs, and all that stuff. He will tell you to use ragged right margins. Do not use your brain to think. Just do what he says. After you have written 10,000 pages his way, you can add your own little flourish. By then you will have developed some mastery and will be able to see whether your flourishes add or detract from your primary purpose.
I couldn’t agree more – a total repeal of FATCA is what’s needed along with this silly citizenship-based taxation. In the UK I’ve kicked off the process writing to my MP and others to find out if the HMRC will do the same as Canada and announce it will not collect FATCA/FBAR penalties.
This is where the logic that Phil talks about comes in to play You need to use it to interpret the “relief” nonsense the IRS is spewing out.
IRS LOGIC 1
IF we just repeat already existing law and pretend it something new, THEN these troublesome Canadians will shut up.
IRS LOGIC 2
IF we give minimal relief to a small group of Canadians, THEN we can look constructive without really changing anything.
IRS LOGIC 3
IF we ignore the rest of the world, THEN we can still collect these horredous FBAR penalties.
We need to see the guidance, but the relief for Canadians appears to be iff (that’s if and only if) a Canadian did not owe taxes. While the Canadians lucky enough to be in this position will rejoice if they mistakenly entered OVDI, there are still many, many Canadians who owe minimal tax due to differing accounting rules between the countries
So, IF 1,2 and 3 above, THEN decency from the IRS re FBAR penalties is roughly equivalent to 0.
IRS waiving penalties if no tax is owed in Canada (http://www.forbes.com/sites/robertwood/2011/12/06/irs-relief-to-canadian-dual-citizens/) but not waiving FATCA. Obviously this is the next hurdle to cross and getting penalties waived for other countries.
http://www.accountingtoday.com/news/IRS-Ease-FBAR-Penalties-Americans-Canada-60977-1.html
The solution is still to repeal FATCA – being lenient for a flawed law is not enought!