What does a tax attorney do?
A tax attorney is a legal professional who specializes in tax law. They use their knowledge and experience to provide legal advice and representation in a variety of tax-related matters, including:
- Tax planning and compliance for businesses and individuals.
- Representation for IRS audits, appeals, and negotiations.
- Representation for tax disputes and lawsuits.
- Estate planning and wealth management.
- Business tax strategy and legal guidance.
Tax attorneys can help you understand complex tax laws and regulations, identify potential tax issues, resolve past mistakes, and develop strategies to minimize your tax liability.
While a tax attorney can be extremely helpful in legal and complex tax matters, most taxpayers do not need one for basic tax filing. For straightforward filing needs, many people handle their taxes using tax software or through general accounting services.
When do I want to hire a tax attorney?
You may want to consider hiring a tax attorney in several situations, such as when:
- You receive an IRS audit notice or investigation. A tax attorney can protect your rights, negotiate with the IRS, and represent you if legal action is required.
- You have complex tax filings or business interests. If you own a business, have significant investments, or deal with multi-state or international tax issues, a tax attorney can help you navigate these complexities.
- You need long-term tax planning or strategy. A tax attorney can help you legally minimize your tax liability and develop a proactive plan for future financial goals.
- You are doing estate or wealth planning. If you want to manage your estate efficiently or plan for heirs’ potential tax liabilities, a tax attorney can help structure your estate plan in a tax-efficient way.
What are the benefits of hiring a tax attorney?
Dealing with taxes and the IRS can be stressful and confusing. Hiring a tax attorney can provide peace of mind that your case is being handled by a legal professional with specialized expertise in tax law.
Key benefits include:
- Legal protection. Tax attorneys can represent you before the IRS and in court.
- Strategic guidance. They can help create tax-efficient strategies for both personal and business finances.
- Confidentiality. Attorney-client privilege ensures your communications with a tax attorney remain private.
- Comprehensive advice. A tax attorney can coordinate tax, legal, and financial planning to align with your overall goals.
What can a tax attorney do that a CPA cannot?
Both tax attorneys and certified public accountants (CPAs) have extensive knowledge of tax laws and regulations. There are several things, however, that a tax attorney can do that a CPA cannot do:
- Provide legal representation in court: Tax attorneys are licensed to practice law and can represent clients in court if necessary, while CPAs cannot. Tax attorneys may also be able to advise you and your business on additional tax-related legal matters that can arise.
- Provide legal advice: Tax attorneys are legal professionals who can provide legal advice and guidance on a variety of tax-related legal matters for individuals and businesses. CPAs can only provide accounting and tax preparation services, and may be limited in the type of tax advice they provide to clients.
- Help with complex tax issues: Tax attorneys are particularly useful for complex tax issues such as business reorganizations, mergers sales, and acquisitions, as well as various state and international tax issues. While CPAs can assist with these matters, a tax attorney's legal expertise is often necessary.
- Attorney-client privilege: Any communication between a tax attorney and client is protected by attorney-client privilege, which means that the communication is confidential and cannot be disclosed without the client's consent. This privilege does not extend to communications with CPAs and can be important if you are facing legal penalties or consequences.
In short, CPAs focus on preparing and filing taxes, while tax attorneys focus on legal representation, dispute resolution, and strategic legal advice.
If you’re facing an IRS audit, tax dispute, or legal issue involving taxes, or if you want to create a legally sound tax or estate plan, consulting a qualified tax attorney can be a wise step.
Please note: This page offers general legal information, not but not legal advice tailored for your specific legal situation. Rocket Lawyer Incorporated isn't a law firm or a substitute for one. For further information on this topic, you can Ask a Legal Pro.
