Tax Controversies & Litigation

Steptoe's Tax Controversies Group includes experienced litigators who have served as Justice Department trial and appellate attorneys, judicial law clerks, and Treasury officials. We combine trial-tested litigation skills with up-to-date substantive tax experience. This combination enables us to take on the most challenging cases and achieve outstanding results for our clients. Over their careers, our lawyers have litigated cases on a wide variety of federal and international tax issues, including economic substance, transfer pricing, civil penalties, foreign tax credits, insurance taxation, APA claims, white collar matters, various tax incentives such as research credits, as well as numerous other substantive and procedural issues.

Our lawyers have proven skills and extensive experience in all aspects of tax controversy and litigation, including managing IRS audits, filing and presenting protests to IRS Appeals, negotiating litigation settlements, trying cases, arguing appeals and representing clients in Congressional investigations and white-collar investigations.

Our active controversy and litigation docket keeps us at the cutting edge of evolving administrative and judicial practice and procedures, strategy, and tactics.

Steptoe also represents clients with respect to international tax controversy matters before the IRS, the US Department of the Treasury, the US Congress, and foreign tax authorities. Our tax controversy lawyers have proven experience at the IRS and in court across a broad range of subjects. Our efforts include:

Advocating positions effectively throughout the IRS administrative process and in the courts
Working with experts to develop the facts and documentation necessary to prepare and defend positions
Achieving success in demonstrating the infirmities in expert work performed for the government in tax controversies

Resolving IRS Administrative Controversies

Pre-controversy advice and counsel. Our tax lawyers combine litigation and substantive tax experience to assist clients in effectively anticipating and planning for future controversies. Often, when the tax treatment of an item or transaction is challenged, the ultimate resolution is influenced significantly by actions taken or not taken when the transaction was planned, implemented, or first reported. With this in mind, we provide experience-based advice on reporting, disclosure, privilege, document retention, and other pre-controversy matters.

Audit controversy skills. We effectively use all available procedural techniques, including pre-filing agreements (PFAs), requests for technical advice, fast track appeals resolution, early referral, appeals mediation, and other IRS practices and programs. We have extensive experience with IRS summonses, privilege litigation, enforcement proceedings, and joint defense agreements.

Individual and coordinated IRS and Treasury settlement efforts. We fashion creative and effective approaches to settlement. Our experience encompasses not only direct negotiations for single clients, but also group representations of taxpayers with the same or similar issues. We work hard to achieve favorable results by identifying the most effective approach, whether it be with the examining agent, the Large Business & International (LB&I) Division, the IRS Chief Counsel’s Office, the Office of the Commissioner, the Department of Treasury, or elsewhere.

IRS Appeals controversies. We prepare protests and negotiate with IRS Appeals to achieve favorable settlement results, and routinely appear before Appeals offices across the country, using all available Appeals tactics and strategies, including early referral and post appeals mediation, either to achieve settlement or to position the case to proceed most effectively to litigation.

Chambers USA, Tax: Corporate & Finance, Nationwide (2009-2026)
Chambers USA, Tax: Controversy, Nationwide (2008-2026)
Legal 500 US, Tax: US Taxes: Contentious (2009-2026)
Legal 500 US, Tax: International (2011-2026)
Legal 500 US, Tax: US Taxes: Non-Contentious (2009-2026)
Legal 500 US, Tax: Not-for-Profit (2013-2024)

Professionals

John Cobb

John Cobb uses a combination of deep technical knowledge and sound practical judgment to solve clients’ most challenging tax problems. His experience includes transactional planning, policy advocacy...

Of Counsel

Tax, Transactional Tax, Exempt Organizations, Private Client

Washington, DC
+1 202 429 3087

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Zain Devshi

Zain Devshi's experience spans corporate transactional tax planning, complex tax controversy, and advising both nonprofit and corporate clients on a wide range of federal, state, and international tax...

Associate

Tax, Transactional Tax, International Tax, Tax Controversies & Litigation

Washington, DC
+1 202 429 3081

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Caitlin R. Tharp

Caitlin Tharp's multidisciplinary practice focuses on tax controversy, ERISA, and employee benefits, covering both litigation and counseling in those areas.Caitlin has more than a decade of experience...

Partner

Tax, Tax Controversies & Litigation, Employee Benefits & ERISA, Employee Benefits & Executive Compensation

Washington, DC
+1 202 429 1391

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Representative Matters

Tax Litigation and Administrative Appeals

Won refund action as trial counsel on behalf of principal in contract manufacturing arrangement involving the Section 199 domestic production activities deduction.
Achieved a 99% IRS concession in alleged ESOP prohibited transaction case docketed in Tax Court.
Achieved over a 90% government concession in foreign tax credit case in the Court of Federal Claims.
Represented a major financial institution in a multi-million-dollar case involving the deduction of penalties involving a UK regulatory authority.
Served as trial and appellate counsel in an IRS challenge to several million dollars of tax credits for nonconventional fuel.
Obtained a government concession and refund of penalties related to a conservation easement transaction.
Won 100% IRS concession for pharmaceutical company in IRS Appeals regarding effectively connected income.
Won 100% IRS concession for energy company in IRS Appeals regarding refund claims for alternative fuel excise tax credits.
Won 100% IRS concession of failure-to-pay and failure-to-file penalties for healthcare company in IRS Appeals.
Served as trial and appellate counsel in case involving the IRS’s assertion of transferee liability for an alleged tax shelter.
Represented partners of real estate and infrastructure businesses before IRS Appeals with respect to questions of the character of financing, interest tracing, at-risk amounts, and deemed distributions.
Defended individuals against IRS third-party summonses of financial institutions.
Represented law firm in dispute regarding treatment of partners for New York City unincorporated business tax.
Represented a multinational diversified manufacturer before IRS Appeals in a matter relating to the capitalization of the cost of buying out Chinese minority partners.
Represented a large multinational media company before IRS Appeals in connection with a major Foreign Sales Corporation controversy.
Represented major financial institution before IRS Appeals on the timing of deductions arising from a closing agreement.

Transfer Pricing Controversy Matters

Represented US multinational in MAP and APA to avoid significant adjustments and protracted transfer pricing disputes with European country.
Advised US oil and gas company on use of APA “roll-back” to resolve non-US transfer pricing dispute.
Achieved 100% concession from the IRS on a significant cross-border royalty issue.
Assisted in developing a transfer pricing methodology for a global brokerage operation with emphasis on valuable trading strategies.
Assisted a major financial institution in resolving a difficult transfer pricing examination with the tax authorities of a major Asian country.
Assisted a major consumer products company with the resolution of large multi-country matter involving transfer pricing adjustments, as well as the impact of those adjustments on the foreign tax credit and controlled foreign corporation rules.

Audit Controversy Matters

Represented a large financial institution in connection with a major controversy involving treaty limitation on benefits, contingent interest, active trade or business, and other issues.
Represented a hedge fund group in connection with multijurisdictional audit issues.
Advised several clients in connection with IRS audits of stapled stock and other tax-sensitive cross-border structured transactions.
Represented a high-tech services company before the IRS in connection with a significant transfer pricing controversy.
Represented high-net-worth individuals in IRS audit involving at-risk amounts for use of partnership losses.
Represented a foreign airline in connection with the application of US excise taxes.
Represented e-commerce retailer in New York state sales tax audit.
Represented foreign distributor in IRS audit involving effectively connected income, title passage, and agency relationship.
Advised major manufacturing company in IRS audit of captive insurance policies.

Competent Authority & Other Treaty Controversy Matters

Represented a Middle Eastern investment company in groundbreaking MAP resolution of high value and seemingly intractable dispute.
Represented a major US multinational in obtaining extremely favorable resolution of US-Asian withholding tax issue historically resolved in favor of the other country.
Represented a multinational medical and scientific device company before the US Competent Authority to obtain a taxpayer-specific agreement under the US-French treaty regarding the potential double tax resulting from a French thin capitalization adjustment.
Represented trust fiduciaries and high-net-worth individuals in connection with competent authority and other aspects of the application of adverse foreign legislation.
In connection with a French tax controversy, advised a foreign professional services company on its treatment under the French-US tax treaty.
In connection with a Japanese tax controversy, advised a major US investment bank on the proper application of OECD principles embodied in the US-Japan tax treaty.