Sample Fee Agreement

Some attorneys will be more interested in marketing their services to you than in providing fair and full representation in your case before the IRS in the Tax Whistleblower Reward Program.  We recognize that the sample Standard Tax Whistleblower Contract may need to be modified based on negotiations between you and the attorney and based on the state in which you reside; however, this sample contract is attached for you to use to make sure that the attorney you hire has the qualifications and experience to handle your case before the IRS in the Tax Whistleblower Reward Program.  Please note that the attorneys at the Tax Whistleblower Law Firm, LLC are willing to sign this contract with all the attached Exhibits.

We have identified those benefits that we offer in this sample contract.  If an attorney whom you have chosen does not like the fact that you present them with a contract that guarantees their conduct, it may mean that you have not found the right attorney.  Remember that attorneys, not law firms, are licensed to practice before the Courts and before the IRS.  Therefore, do not be fooled by attorneys who attempt to avoid the issue of their experience and qualifications and who state that their law firm has the necessary resources to assist you.  You want to hire an attorney with the necessary background (i.e., a former IRS attorney) to represent you effectively before the IRS in the Tax Whistleblower Reward Program.  You do not want an undefined group of people working on your case who are not accountable to you in the Tax Whistleblower Reward Program Contract.


Sample Fee Agreement

TAX WHISTLEBLOWER CONTINGENT FEE AGREEMENT (with comments on right)

THIS AGREEMENT is made and entered into this ______ day of ______ 20__, by and between the [Attorney], [Address], (hereinafter "Attorney"), [Law Firm], [Address], and

Name: __________________________________
Address: ________________________________
(hereinafter "Client").
Insist that the Agreement be between you (the tax whistleblower) and the Attorney, NOT you and just the law firm.

Keep in mind that the law firm does not practice before the IRS nor does the law firm practice in Court.  It is only the individual Attorney who has the license and skills that you want, not some unknown member(s) of the law firm who will come and go without your knowledge.

WHEREAS, Client has knowledge and information with respect to the underpayment of tax of a taxpayer (i.e., individual/business/trust/estate) that may assist the Internal Revenue Service (hereinafter "IRS") with determination and/or collection of the tax;

 

WHEREAS, Client may be entitled to a reward between 15% and 30% of the amount collected by the IRS based upon the information that is provided by Client with respect to the underpayment of tax by taxpayer;

 

WHEREAS, Attorney has a “Tax Whistleblower Attorney Rating” of [Rating], as reflected on Exhibit A, and claims to have the knowledge and experience to properly gather the information and documents, identify witnesses, and prepare documents on behalf of the IRS to assess and present the information from Client to the IRS in a format (i.e., an "audit plan") so as to increase the likelihood of acceptance of the case by the IRS for purposes of obtaining a reward and so as to increase the amount of the reward from the minimum of 15% to the maximum of 30% pursuant to IRC § 7623(b); and

Be sure to complete the Tax Whistleblower Attorney Rating Survey (Exhibit) and attach it to this contract as Exhibit A.  This will ensure that there is no misrepresentation by the Attorney as to his qualifications and experience.  Should the Attorney mislead the whistleblower, he may not be entitled to a fee based upon misrepresentation.  Do not let the Attorney include the background, experience, and education of others in the firm in completing the Tax Whistleblower Attorney Rating Survey.

WHEREAS, Client wishes to employ Attorney to investigate and pursue, as appropriate, the preparation of an audit plan for presentation to the IRS, and Client wishes Attorney to act on Client's behalf in obtaining the largest reward available, including taking administrative as well as judicial action as may be necessary to increase the reward.

 

NOW, THEREFORE, Client wishes to employ Attorney to represent Client on a contingent fee arrangement, as follows:

 

In retaining Attorney, Client agrees that the fee will be contingent, that is to say, if no reward is paid by the IRS, no fee will be paid to Attorney for such representation.  If the IRS pays a reward based upon collection of tax, penalty, and interest for which such information was provided, the fee will be [FEE] (__ %) of the gross amount received as it is paid by the IRS to Client.

A contingency fee is based upon the facts and circumstances.  The standard fee is typically one-third of the reward.

All costs and expenses (including expenses and fees of expert witnesses, court costs, copying charges, deposition charges, travel expenses, and the like) incurred in the pursuit of the reward on behalf of Client shall be borne by Attorney, to the extent permitted by the state bar in which the attorney is licensed.

Make sure that costs and expenses are borne by the Attorney.  Some Attorneys will try to shift these costs to the Client, stating that it is normal practice to do so.  It is NOT normal in tax whistleblower situations.  However, be aware that some State Bar Associations will not allow the Attorney to pay the costs of litigation.

Client agrees that the IRS will be directed to pay the reward to Client but that the check will be directed to Attorney.

 

Client agrees to keep Attorney advised as to Client's whereabouts at all times and to cooperate in the gathering of information and documents to the extent that such information and documentation may be able to be gathered by Client.

 

Client acknowledges that no guarantees have been made as to what results will be achieved or as to what amounts, if any, Client may receive as a reward.

 

Client understands that, if during the investigative stage (i.e., determining if there is a case qualifying for a reward under IRC § 7623), if Attorney concludes that the case does not qualify for a reward, or does not have merit, in the sense that it is unlikely that the IRS might accept the case, then Attorney may give notice to Client that Attorney will no longer pursue this matter and will withdraw.

 

Attorney agrees that all information from Client is subject to Attorney-Client Privilege and any other applicable privileges, including the Work Product Doctrine, Confidentiality Rule as set out in ABA Model Rule of Professional Conduct 1.6 Confidentiality of Information, and that of the confidentiality rules of the appropriate State Bar Associations.  Attorney further agrees that such information, along with Client's identity, will be protected in accordance with the Steps of Protection as set out in Exhibit B, attached.

Make sure the Attorney will take the extra steps (Steps of Protection), such as those set out in Exhibit B, to help ensure confidentiality.

Attorney further agrees that Client's identity will not be disclosed unless authorized by Client.

Make sure that the Attorney will GUARANTEE confidentiality.

Attorney further agrees to take judicial action (file suit against the IRS) as set out in IRC § 7623, if Client is dissatisfied with the amount of the reward as determined by the IRS and if Client directs Attorney, in writing, to file suit.  Client is to notify Attorney within fifteen days of being notified of the determination of reward by the IRS if Client wishes to challenge the amount of the reward in the U.S. Tax Court. Such judicial action, if any, will be undertaken by Attorney for no additional fee other than (contingency fee) agreed to within this Agreement.

Make sure that the tax whistleblower Attorney is willing to litigate the reward at no additional fee.

Guarantee of Confidentiality

Attorney agrees to guarantee the confidentiality of Client as a whistleblower. Such guarantee may be waived by Client at any time by Client signing a written waiver. However, should there otherwise be an intentional or inadvertent disclosure by Attorney or Attorney’s office and/or by the IRS or its employees without the written waiver of Client, Attorney will waive all fees to which Attorney may have been entitled in this matter pursuant to this Agreement.

This is important.  Is the Attorney that the whistleblower chose confident in his/her ability such that he/she would be willing to sign a Guarantee of Confidentiality?

This Contingency Fee Agreement is to be governed, construed, and interpreted in accordance with the laws of the State of [State].

 

By executing this Agreement, Client acknowledges that Client has read the Agreement, understands its terms, and has received a signed copy of the Agreement.

 

Client                                                      Attorney

_______________________                   _________________________

_______________________                   _________________________