Learn When to Hire a Tax Attorney

Law companies or accounting businesses frequently employ tax attorneys. Some may be sole practitioners, which means they run their own company and work for themselves.


What a tax lawyer does

A tax attorney is a lawyer who focuses on taxation. Financial attorneys assist individuals in organizing their money to optimize their tax situations, comply with tax rules, and resolve disputes with the IRS or other tax authorities. Some specialize in inheritance, foreign, or company taxes.

Tax lawyers in law firms typically assist clients in obtaining favorable tax treatment in a variety of situations. For example, they may prepare contracts or other legal documents as needed and represent clients in tax court or elsewhere.

Tax lawyers at accounting and consulting businesses are more likely to assist clients in complying with tax requirements.

When is it worthwhile to hire a tax attorney?

Some scenarios may necessitate the services of a tax attorney.


Planning an estate

A tax attorney can assist you in developing estate planning strategies and handling the paperwork associated with avoiding estate taxes, transferring assets to family members, establishing trusts, and other techniques.

Establishing a business

A tax attorney may be able to assist you in developing tax-efficient solutions for beginning, buying, selling, or expanding a business.

Tax controversies

A tax attorney can assist you if you have a tax problem, wish to challenge the IRS, the state, or a local tax authority, or seek a hearing before the United States Tax Court.

Tax reduction

If you have an outstanding balance with the IRS or another tax authority that you would like to negotiate or fight, a tax attorney may be able to assist you in exploring options such as:

  • Compromise Offer
  • Relief for the innocent spouse
  • Tax bills can be paid in installments over time using installment plans.

What to look for in a tax lawyer

Here are three things to look out for.

A law degree. To practice law, an attorney must obtain a law license. You may find out if a tax attorney is licensed to practice law in your state by visiting the website of your state’s bar association.

Signs indicate a higher level of knowledge or specialization. For example, to obtain a legal license in most states, you must also complete law school. Some tax lawyers hold a master’s degree in taxation (an LL.M). Some tax attorneys also hold CPA credentials, indicating that they are certified, public accountants.

A tax identification number for a preparer (PTIN). Anyone who prepares tax returns for a fee must obtain a PTIN from the IRS. In addition, your tax return must be signed by the preparer, who must also supply a PTIN.

How much does a tax attorney charge?

Legal work isn’t cheap in general. According to a poll conducted by Martindale-Avvo, legal marketing and directories organization, tax attorneys charge an average of $295 to $390 per hour. However, the length of the attorney’s experience can shift the value lower or higher.

According to the firm’s research, 37% of those who utilize legal advice for taxes pay between $0 and $5,000, and another 14% spend between $5,000 and $100,000. A quarter of the work is done pro gratis or for free, and 4% is done on a contingency basis (where the attorney receives a portion of the damages if any are awarded).

You might be able to get free or low-cost tax advice from a tax attorney in your area if you go to a low-income tax clinic, often known as a LITC. These clinics represent persons whose income falls below a set threshold and need to resolve tax issues with the IRS. For example, LITCs can defend you before the IRS and in court in audits, appeals, and tax collection disputes. LITCs can also assist people in responding to IRS letters and resolving account issues. The Taxpayer Advocate Service website will help you find a nearby clinic.