Choosing a Tax Professional, Tax Attorney, CPA, or Enrolled Agent?

Whether you hire a tax attorney, certified public accountant (CPA), or enrolled agent to help you with your tax needs depends on your specific situation.

Tax Attorney:

Tax attorneys specialize in the minutiae of IRS tax code. They can provide advice on complicated legal issues, particularly in the areas of trusts, estate planning, tax disputes, and business tax law. Attorneys are powerful negotiators who can analyze the facts of a case in light of the law and construct arguments that best support a desired position. They also have the ability to use the court system in ways that can provide leverage in resolving tax cases.

Some tax attorneys will help you prepare your tax returns for a premium; however, tax attorneys are not accountants and are rarely involved in the process of filing taxes with the IRS. Tax attorneys typically do not hold the expertise of an accountant when maximizing deductions and planning ahead for future tax years.

Reasons you may need a tax attorney include:

• You are starting a business and need legal counsel about the structure and tax treatment of your company.
• You are engaging in international business and need help with contracts, tax treatment, and other legal matters.
• You plan to bring a suit against the IRS.
• You are under criminal investigation by the IRS.
• You have committed a tax crime and need the protection of attorney-client privilege.

If your tax issue is likely to reach tax court, or if you have been charged with a tax related crime, a tax attorney is your best option. Unlike other tax professions, tax attorneys maintain attorney-client privilege and so cannot be forced to provide information to third parties or to testify against you.

CPA:

Certified public accountants (CPA) are trained primarily in maintaining business and financial records. They can also help you prepare your taxes, ensure you are in compliance with the tax code, and file or correct your tax returns. They may also represent you in front of the IRS. CPAs can provide financial planning, and are a good resource for those seeking a holistic tax strategy to deal with personal and professional financial issues.

Enrolled Agent:

Enrolled agents specialize in tax issues, and receive their certification by passing a comprehensive examination which covers all aspects of the tax code, or working at the IRS for five years in a position which regularly interpreted and applied the tax code and its regulations. Enrolled agents represent taxpayers during IRS collections, audit investigations, offers in compromise, and reducing penalties. If you are facing an audit and believe you have not committed a tax crime, or if you simply neglected to file a required form, then an enrolled agent is good option.

Laws on this topic may vary from state to state. This content is not meant to provide you with complete information and it is not intended to be legal or tax advice. It is recommended that you consult with your own attorney, accountant or other advisor regarding your specific situation.