What happens when a kid from Miami earns his accounting degrees at the University of Florida, goes to the University of Miami for law school and his LL.M. in tax, joins the IRS Office of Chief Counsel, spends twelve years as a government attorney litigating the agency’s most complex controversies — the last four as a Special Trial Attorney standing up in United States Tax Court on behalf of the United States, building litigation teams, managing expert witnesses, briefing executives, learning exactly how the IRS classifies a return for examination, what revenue agents are looking for in an initial interview, what makes a case go to Appeals and what makes it go all the way to trial

In this episode of the Trustcast Show, Zane Myers speaks with Michael Kramarz, a tax principal and the head of Federal Tax Resolution at Kaufman Rossin in Boca Raton, Florida — the largest independent CPA and advisory firm in Florida and one of the top 100 firms in the United States — about what the IRS is actually doing when your return gets flagged, what your CPA is getting wrong in the first forty-eight hours, and why the Employee Retention Credit is now one of the most scrutinized items on the books of any business that claimed it.

Michael explains the difference between a CP2000 matching notice and a formal examination — why one is mostly a correspondence exercise and the other involves a human revenue agent with a list of issues, an initial interview, a tour of your business, and the ability to find things that were not on that list if you give them the opening. He walks through what actually happens inside the IRS the moment your return is selected — the DIF score algorithm that flags fluctuations in income and expenses, the classifier who identifies which issues go to the field, the revenue agent who will Google you and your business before the first phone call, and the Large Business and International Division campaigns that target specific transactions and are publicly posted on the IRS website for anyone to check before entering a deal.

They also discuss the two biggest mistakes CPAs make in the first forty-eight hours — not responding on time and giving the IRS far more than they asked for — why answering only the exact question being asked is as true in a tax examination as it is in witness prep, why the first ninety days of an examination are the most dangerous and the most likely to produce statements or document productions that open entirely new issues,

Michael Kramarz is a tax principal and head of Federal Tax Resolution at Kaufman Rossin in Boca Raton, Florida, a former IRS Special Trial Attorney with twelve years at the Office of Chief Counsel and over two hundred engagements in and out of United States Tax Court, a graduate of the University of Florida and the University of Miami School of Law with a B.S. and M.Acc. in Accounting and a J.D. and LL.M. in Tax, and the Michael Scott of federal tax controversy — which is his actual middle name and he has heard every joke.

Connect with Michael Kramarz:
kaufmanrossin.com/professionals/michael-kramarz/
kaufmanrossin.com
Boca Raton, Florida — federal practice, nationwide, also state tax matters

Chapters

00:00 Introduction to Michael Kramarz
00:10 Twelve years inside the IRS as a Special Trial Attorney — and the moment he had to stop saying “we”
00:33 The billing adjustment: from all the time in the world to billing efficiently for clients
01:11 Why he left the IRS after twelve years and headed to greener pastures
02:22 Getting referrals from CPAs and attorneys when a client’s IRS problem is more than they can handle
02:35 A client just forwarded an IRS letter and is panicking — what to tell them first
02:47 Take a deep breath: most of these are misunderstandings, it is a process, and here is what happens
03:39 How to know if you can handle it yourself or if it is time to bring in a specialist
05:25 The free thirty-minute consultation — why he offers it and what it actually covers
06:24 CP2000 matching notice versus a formal IRS examination — why which one arrived matters
06:32 What a CP2000 is, why it happens, and how it is usually handled
08:09 An honest omission — can you really get in serious trouble for something your accountant missed
08:47 The twenty percent accuracy-related penalty, what triggers it, and who actually goes to jail
09:36 Notice of deficiency — ninety days to file a Tax Court petition and what happens if you miss it
10:29 The jurisdictional issue, the circuit split on equitable tolling, and why you do not want to rely on it
11:07 The two biggest CPA mistakes in the first forty-eight hours after a return gets flagged

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