Preparation
You must first contact a CPA to understand the severity of your case before choosing a tax lawyer. This is crucial to choosing the right tax lawyer because each lawyer will require immediate communication about the severity of tax issues. Remember to be prepared to know right away if your lawyer suits your needs.
Understanding Tax Law
Tax law in the United States is a rule used by your state to calculate how much tax you owe. Take note that tax law in the United States is heavily reliant and regulated by the IRS. Therefore, it is absolutely essential to handle your tax issues with the IRS before pursuing your case.
Creating a List of Tax Lawyers
Search for a lawyer online, in your area, or through any other means. Your main objective is to find a handful of lawyers with a long history of successfully handling similar tax cases. A general rule of thumb for searching for a tax lawyer should be prioritizing lawyers who are also CPAs as they can help manage your tax issues with the United States government.
Pursuing your Tax Case
A qualified tax attorney must possess good educational qualifications. The majority of tax lawyers possess a Juris Doctor (JD) in an accredited law school, but it is advantageous if they possess further credentials, like a Master of Laws (LL.M) in Taxation. The advanced degree indicates specialized tax law knowledge. In addition, a lawyer should be licensed to practice law in your state and be a member of the state bar association. Some tax lawyers also can become certified as Certified Public Accountant (CPA), which can add more financial and tax expertise.
All tax lawyers are not equally experienced or specialized. Some deal exclusively in corporate tax law, while others work with individual tax issues, estate tax planning, or international taxation. In selecting a tax lawyer, try to select one whose experience best meets your needs. If, for example, you are under IRS audit, find a lawyer with a good track record for handling tax disputes. Similarly, if you are in need of assistance with tax planning for businesses, seek one who is skilled in corporate tax.
The reputation of a lawyer speaks volumes of how effectively he or she handles tax matters. You can know the reputation of a tax lawyer by reviewing client comments, testimonies, and peer opinions. The majority of legal directories, such as Martindale-Hubbell, Avvo, and the American Bar Association, provide ratings and reviews for lawyers. You may also ask your previous clients or peers to refer you to check that the lawyer has a clean record of winning cases like yours.
Good communication is crucial when dealing with tax problems. Your good tax attorney ought to be capable of simplifying complicated tax law so that you can grasp it. In your first consultation, determine if the attorney hears what you have to say, addresses your questions professionally, and delivers realistic solutions. Also, consider their availability and responsiveness—will they be reachable when you urgently need them? Steer clear of lawyers who are hard to contact or whose communication with clients is not prioritized.
Legal fees vary widely based on the experience of a tax lawyer, where they are, and how complicated your case is. Some attorneys bill by the hour, while others bill flat fees for specific services. Before you retain a tax lawyer, have them detail their fees to you and ensure that you understand their billing practice. While it may be tempting to take the cheapest, keep in mind that quality legal work is not cheap. Look at the cost of your tax issue versus the attorney’s fee to determine if their services are worth the expense.
A tax lawyer should have very high professional and ethical standards. Check for any disciplinary action or complaint filed against them with the state bar association. A good lawyer will be transparent, truthful, and dedicated to protecting your best interests. Avoid lawyers who overpromise and encourage you towards aggressive tax planning that can lead to legal complications.
Common Myths about Tax Cases
- Students do not have to pay taxes.
- This is only required if the student makes the minimum amount of income corresponding their filing status.
- Online income is not tax.
- The IRS does not consider online income to be any different than income made without the use of the internet.