Southeast Louisiana Legal Services has updated its 93-page manual, Tax Practice for Legal Services and Pro Bono Attorneys (Dec. 2009):

This guide covers the basics of federal income tax practice for legal services attorneys: interview information to collect from the taxpayer, Internal Revenue Service procedures, appeal rights, Tax Court litigation, refunds, innocent spouse relief, the Earned Income Credit, Head of Household Filing Status and Dependency Exemptions.

Tax law is important to indigent persons for many reasons:

• The IRS disproportionately audits the poor.
• The Earned Income Credit is now the largest federal anti-poverty program. It is larger than SSI, food stamps or TANF, and provides a significant portion of a recipient’s annual income. The poor are frequently audited on the EIC and the closely related issues of dependency exemptions and head of household filing status. Disallowance of the EIC can result in a large nondischargeable debt relative to the taxpayer’s financial means. Some taxpayers become homeless when they are denied the EIC.
• Tax debt can preclude a person from becoming a homeowner.
• Tax law changes have expanded the opportunities for reasonable settlements of tax debts and protection of homes from seizure.
• Since welfare reform, there are more working poor who have tax controversies.
• Recent tax law changes allow the IRS to levy welfare benefits.
• Innocent spouse relief has been liberalized to provide greater relief.

(Hat Tip: Francine Lipman.)