By SYDNEY P. FREEDBERG
Published November 16, 2003
"I am not a bean counter," Jay Koren vehemently declares. "I am an attorney."
Why that description rankles Koren so isn't very clear. This is: He's among the best there is if a company wants to find a way to lower its tax bill.
"My wife once asked me, "Don't you feel bad about getting a $3-million refund that could have gone to education?' " Koren said.
His response: "Doesn't the Department of Revenue feel guilty for over-assessing the taxpayer?"
A charming, outgoing father of three, Koren symbolizes the new breed of low-profile, low-tax guru who helps multistate companies reduce their state tax bites.
Sometimes relying on novel legal interpretations and growing complexities in state tax laws, he devises tax-savings strategies, then pitches them to businesses hungry for a competitive edge.
Koren, a partner in the Miami office of the accounting giant PricewaterhouseCoopers, says he always plays by the rules.
"I'm not in the business of cheating the state," he said, adding that sometimes he finds errors in his clients' tax returns that lead to more tax revenue for the state. "We are in business to get the tax figure right. . . . We don't employ tax shelters."
But Koren, 51, also has found himself in some messy court disputes with his tax advice - known in the accounting world as "plays" - taking the stage.
Department of Revenue lawyers say at least three Koren clients, Bank of America Corp., Chiron Corp. & Subsidiaries and the former AmSouth Bank of Florida, incorrectly tried to reduce their taxes. In the AmSouth case, they characterized the tax-savings step as a "sham."
Koren says he suggested to AmSouth an idea nearly identical to one that state tax-law specialists had already approved in writing. But after a number of financial institutions amended their tax returns based on the state's response, auditers inexplicably reversed their position in the AmSouth case, he adds.
In all three disputes, Koren defends his clients as good corporate citizens that Florida is trying to squeeze into paying too much tax.
"My clients have paid on the amount dictated by law," he said. "If the department wants more tax, let them go to the Legislature for a law change."
Koren is something of a fixture around "Tax World," the nickname for the sprawling Department of Revenue complex in Tallahassee. Sometimes, he drafts letters to revenue officials, requesting rulings on specific tax strategies before companies use them.
He also meets with department officials in efforts to persuade them that they're misinterpreting the "plain language" of state laws or using flawed rules to make companies overpay. Or, if state auditors come knocking, he helps negotiate or litigate to minimize back taxes due.
Koren reached the top of Florida's corporate accounting world by accident.
"I couldn't stand accounting," said Koren, who majored in it in college. "It was too dry."
So he went to law school and became a lawyer. And Southeast Bank hired him, eventually naming him vice president and tax planning manager.
In 1987, Koren was a player in Tallahassee, lobbying for banks that wanted the state's new 5 percent sales tax on services dramatically revised or repealed. It was killed.
Shortly before Miami-based Southeast folded, he joined PricewaterhouseCoopers. At the time, bank mega-mergers and consolidations were in full swing, and Koren began the PwC section that specializes in state and local tax.
By the mid 1990s, the state tax-planning business was booming. Koren became known as the go-to guy for multistate financial corporations eager to shrink their Florida income tax bills.
In 1999, PricewaterhouseCoopers promoted him to partner.
Koren won't discuss work he does for clients or his fees. Big Four firms are known to be rewarded handsomely for their services; sometimes, they can get between 10 and 40 percent of taxes saved. Partners can earn up to $500 an hour.
Koren lives in a Miami-Dade suburb with his wife, Joanne Harvest Koren, a lawyer and former public school teacher who directs the Academic Achievement Program at the University of Miami School of Law.
The couple's three children all attended Florida public schools.
