Tax Research and Writing

 Carla Neeley Freitag


Writing to Clients About the Tax Laws


Writing about the tax law requires the same general skills as writing about other legal subjects. There are, however, also some special challenges that confront the attorney seeking to convey information about the tax law to a client in an understandable manner. This article contains suggestions that may help you to communicate more effectively in writing with your clients and others about tax issues.  

Breaking Down Barriers  

Among lay persons as well as other lawyers, the prevailing view seems to be that the tax law is either boring or incomprehensible or both. The statement "I am a tax lawyer" is a guaranteed conversation stopper. Nevertheless, one of the jobs of a tax lawyer is to communicate to others what the tax law says about a particular subject. Especially for complex subjects, a written explanation should be provided. The challenge is to convey the information to the client in a manner that is understandable but still accurate.  For example, there are transactions that clients just should not enter into without understanding the applicable laws. An example is the execution of a will or trust. It is the attorney's job to explain to clients in an understandable manner the role of the unlimited marital deduction and the unified credit. They need to understand, for example, that less property is available for the marital trust as the unified credit increases or the value of the estate decreases. A conference with the client that introduces the subject can be followed by a written explanation that reinforces and clarifies the oral discussion. Your demeanor in personal meetings affects a client's perception of your ability, knowledge, and reliability. Similarly, your tone in a letter or memorandum can influence whether or not you convey the information effectively. If you approach the issue with the attitude that you expect the client to understand the issue, your confident tone will make it more likely that the client will approach the information as manageable. Some tax attorneys do not like to write or simply are not skilled writers. When called upon to write to a client, the attorney will procrastinate and the matter will be delayed. And failure to communicate is one of the most common reasons why clients bring malpractice actions. If you want to improve, there are courses in legal writing that can help you to be a better writer. Otherwise, you need to find someone who can handle that part of your matters on your behalf. If you are a partner in a law firm, you can involve an associate in the matter and allow him or her to handle the writing.   

Limit or Avoid Code Section References


Tax lawyers are often accused of "talking in Code sections." Tax lawyers use the Code section references as a shorthand way to refer to the rule in the Code section. Even other tax attorneys, however, sometimes have trouble following these conversations. When writing for clients and other lay persons, the rule of thumb should be to minimize, if not eliminate completely, Code section references. Even when writing a legal memorandum for other attorneys, it is best to limit Code section references to the most important ones. Other citations can be placed in footnotes.   

Use Acronyms Judiciously


An acronym* is a shortened form of a multi-word term using, for example, the first letter of each word. Examples are IRC for "Internal Revenue Code," CRAT for "charitable remainder annuity trust," and NOL for "net operating loss." On the first mention of the term in the text, the acronym is defined as standing for the term. An example is: unrelated business income tax ("UBIT"). If, later on in the document, the reader forgets the meaning of the acronym, it is necessary to return to the definition when the term was first mentioned. This may be easy in a three-page document but unduly burdensome in a 100-page document.  A good use of acronyms is when the acronym already has widespread use. For example, most people, whether attorneys or laypersons, recognize that IRA stands for "individual retirement account." A good rule of thumb is that using an acronym is acceptable when the term is used frequently throughout a document of any length. Conversely, an infrequently-used term in a lengthy document should not be abbreviated. Use of more than one or two acronyms in a single letter or other document is likely to confuse the reader.  

Omit Exceptions or other Complexities that Are Not Applicable or Place Them in a Footnote


The Internal Revenue Code is famous for its exceptions, limitations, and cross-references to other Code sections. In communicating with clients, however, stating all the non-relevant details may distract the client so much that the client misses the gist of the main rule. When writing to a specific client about a specific issue, it is not necessary to mention provisions, including exceptions, that are not relevant to the client's issue. On the other hand, when you are writing a legal memorandum containing a complete analysis, it is advisable to mention any exceptions and state why they do not apply. This can be done in the body of the text or in footnotes.  

Use Examples  The Treasury Regulations are helpful to tax practitioners not only because they elaborate on the Code section language but also because they illustrate how the principles apply in practical situations. Examples also help clients better to understand how the tax laws apply to their issues. In some contexts, it is even helpful to use specific  numbers in an example.  



Your ability to communicate about tax matters will improve if you: 


 ● Maintain a confident tone


● Avoid excessive Code section references, acronyms, and irrelevant complexities


● Provide examples



   * The term "acronym" is used in this article as a generalized reference to acronyms, initialisms, and abbreviations.  

 © 2011 Carla Neeley Freitag