While attending Chattanooga’s City High School in the 60s, Carl Hartley played tight end for the football team. It was a versatile position that sometimes required him to defend his quarterback for the endurance of a play, and sometimes allowed him to break away from the line and catch a pass. Harley still plays a mixture of offense and defense today as a tax attorney at Baker Donelson.
“Sometimes, our focus is on planning for a client as laws change. Say the owners of a company want to diversify its operations and buy a company in another state, or want to split their existing company into two companies and hire workers in another state. Those things require planning so you can minimize the tax hit,” he says, explaining the offensive aspect of his work. “We also work defense in connection with tax auditors. When an auditor shows up at your door, we try to identify what he wants to see, the scope of his audit, the issues on which he’ll be focusing, why he’s picking on our client, and so on. Then we try to respond to those issues,” he says.
While tight ends are rarely in a position to pull off a big play, Hartley has prevented significant losses. He recently resolved an IRS audit in which the federal agency had assessed several millions of dollars of taxes against his client, a large company. Hartley and his team reduced the amount owed to less than $50,000. He says the key block in that play came when he identified a misapplication of the law on the part of the IRS.
“Our task when we undertake the representation of a client is to not only provide objective advice as to the possible outcomes of the audit, but also to interact on an adversarial basis with the federal or state revenue service, and to put our best face forward with respect to why their position is not as strong as they believe it to be,” Hartley says.
Hartley’s playbook includes rulings, regulations and procedures for interpreting tax law as well as the huge number of court decisions he can use to interpret facts. He says keeping up with changes to the law isn’t easy, but that it is satisfying when a client experiences a positive outcome. “It’s gratifying when a client agreed with the strategy we intended to use, and the facts were strong enough to support our position,” he says. While Hartley feels good when he’s successfully defended a client against bad allegations, he sometimes has to return to the huddle and tell his clients they made a bad call. This, too, is satisfying to Hartley, as it brings his clients into compliance with the law. “Not long ago, we met with a client who had filed tax returns in another state, and that state was auditing those returns. We looked at the returns, and told our clients they had misunderstood them and needed to amend them. And they did,” he says.
Hartley clearly is a team player. Although he’s the head of the tax department at Baker Donelson, he never refers to himself, but to a group that includes him and the legions of tax attorneys under him. That said, his confidence, knowledge and experience are evident the moment he begins speaking. Words roll out of him quickly, yet there’s rarely an errant or awkward phrase, and his tone is strong. Also obvious is his enjoyment of his work.
Hartley’s interest in the law stemmed from his love of economics. While studying economics at Auburn, he became captivated by how tax laws are enacted and enforced, by the reasons behind the laws, and how taxes affect people on a daily basis. That interest led him to the University of Tennessee at Knoxville, where he completed his undergraduate work and studied to become an attorney. Hartley graduated from UT in 1973 and accepted a position with Stophel, Caldwell & Heggie, then one of the largest firms in the state. Today, he can look back in nearly 40 years of distinguished practice. Since 1991, Martindale-Hubbard has rated him as an AV Preeminent Peer; “The Best Lawyers in America” has recognized his work in tax, corporate, and charity law; and since 2007, he’s been listed under tax law in “Mid-South Super Lawyers.”
In addition to being an active player on the field, Hartley keeps busy on the sidelines. He contributed his time and skills to the tax section of the Tennessee Bar Association in the ’80s and ’90s, to the point of serving as chairman for two years. During the same time period, he was on a committee that acted as liaison between the TBA and the IRS. Hartley has also been a part of several committees established by the TBA to review and comment on major legislation. Moreover, he lectures various organizations on state and local tax issues.
Hartley has also served the community in which he grew up and lives. His charitable efforts include work with American Lung Association, the Chattanooga Golf & Country Club, and Rotary Chattanooga. Owing to the quality of his work and his professional integrity, the Chattanooga Bar Foundation in 2011 inducted Hartley as one of its Fellows.
Hartley plays as well at home as he does on the road. He and his wife last year celebrated their 40th wedding anniversary, and they enjoy keeping in touch with their three children, including a daughter who works for Child Protective Services in Bradley County, a daughter employed by a local film production company, and a son who’s become a doctor and is doing his residency at Vanderbilt.
While Hartley makes what he does sound easy, he does experience stress related to being on guard for his clients and devising a strategies on their behalf in response to changes in their circumstances or the law. To shake off the strain, Hartley runs about three times a week, though finding time can be difficult. “I ran at 9 p.m. the other night because that was the only time I could get away,” he says. Hartley must not miss many runs, and the runs must do him good, because he wears his years and the pressure of his work well. If “Mid-South Super Lawyers” had a category for lawyers in their sixties who don’t look a day over 50, Hartley would be an obvious candidate for inclusion.
While it’s not easy to sum up 40 years of hard work, it’s safe to say Hartley’s career demonstrates what a person can accomplish when he or she combines excellence with passion. Whether a client is relying on him for protection, or looking to pass the ball to him during a key play, they can rest assured he has the skills for which they’re looking.