Attorney Fees for Form 3520

Attorney Fees for Form 3520

Attorney Fees for Form 3520 Penalty Abatement & Avoidance

Attorney Fees for Form 3520: The IRS has both closed OVDP (2018) and ended DIIRSP (2020).  When the IRS issues a penalty for Form 3520, it can be a very time-consuming and daunting task to get the penalties waived.  If you are considering attorney representation for Form 3520 penalty avoidance or abatement procedures, one important component of representation is whether counsel charges hourly or flat-fee. Experienced Form 3520 counsel always charge flat-fees and not hourly fees when representing clients in Form 3520 matters against the IRS and at the IRS Office of Appeals. (excluding tax court and federal court).


It avoids inexperienced counsel from puffing up your bill and charging you for nonsense services that should be bundled into a flat-fee service (tax and legal).

 Form 3520 Late Filing and Abatement Case

The Form 3520 penalty waiver, avoidance and abatement maze is very complicated. Oftentimes our firm is referred clients who went to an hourly attorney first, who charged them insane fees. The clients are upset that they were baited in with “low-fees,” as the attorney burns through through the retainer.

Oftentimes, a review of the attorney’s bill to their client reveals what was clearly the attorney’s attempt to charge the client to learn the area of law on the client’s dime (e.g., 10 hours of “researching 3520 options and strategies”).

Preparing for, evaluating and executing the 3520 strategy is a time-intensive exercise — it should not be handled hourly. If the client is not successful at the IRS level, has exhausted all remedies and seeks to litigate — those cases are usually handled hourly due to the nature of federal tax litigation. This does not apply to cases at the IRS or Office of Appeals level.

Low Up-Front Hourly Attorney Fees for Form 3520: Bait-and-Switch 

When an attorney is too inexperienced in Form 3520 cases, they will utilize hourly fees to puff up the bill and charge you for services that should be bundled into a flat-fee model. They charge a low up-front retainer to entice you, but ultimately, you end up paying more in the long-run as the attorney keeps burning through and replenishing the retainer. 

When it comes to Form 3520 penalty avoidance or abatement cases, Tax Specialists will always utilize a flat-fee, full-service model when dealing directly with the IRS and Office of Appeals. There are several opportunities to fight the penalties, and developing and executing a strategy is time-intensive.

For example: You are preparing to speak with your attorney who is charging you hourly.

Here is how the hourly attorneys charge you:

  • Review the case (charge)
  • Prepare for the call (charge)
  • Speak with you (charge)
  • “Discuss” with their staff, if they have any staff (charge)
  • Write up a file summary (charge)
  • Send you an email summary (charge)
  • They think about the matter again on the drive home (charge)
  • And they prepare an updated summary (charge)
  • Review new correspondence from the IRS (charge)
  • Prepare & “analyze” correspondence before calling the IRS (charge)
  • Waiting on hold for an hour with the IRS (charge)
  • Email you to say they couldn’t get through (charge)
  • Call the IRS again the next day, on hold for another hour (charge)
  • Email you to say the call was unsuccessful (charge)
  • Now, you are concerned so you call them to discuss. Leave a voicemail because you can’t get through, and you also email a follow-up.
  • Listen to your voicemail and read your email (charge)
  • Re-review your file to prepare before calling you (charge)
  • And the cycle repeats (charge, replenish retainer, repeat)

Then, after paying this inexperienced attorney thousands of dollars, you start losing confidence and realize you need to hire someone else and start all over again. It is better (for your peace of mind and also your wallet) to just go to an experienced lawyer right from the start, to take care of the matter for you.

Benefits of Flat-Fee Form 3520 Lawyers

All Streamlined tax and legal preparation (and other offshore compliance matters) should be handled in-house by a Board-Certified Tax Lawyer Specialist and their team.

The entire matter from beginning-to-end should be flat-fee, full-service, and all-inclusive. Each client has a unique story, with their own specific facts and circumstances. No two Form 3520 cases are the same and fees should be representative of that specific client’s case.

Fees should only be determined after the Attorney has spoken in detail with the client — and not some prefabricated fee.

And, to protect the attorney-client privilege (and avoid a court rejecting Kovel), the full case (Tax and Legal) should be handled in-house.

International Tax Law Specialist Team: Golding & Golding

Our firm specializes exclusively in international tax, and specifically IRS offshore disclosure, including help clients with late reporting of Forms 3520 and 3520-A, including currency restrictions on gift transfer issues.

Contact our firm today for assistance.