What is a tax attorney?
A tax attorney is a lawyer who specializes in taxes and dealing with the Internal Revenue Service on behalf of clients. Like any other lawyer, a tax attorney undergoes extensive training and education, including earning a Bachelor’s degree in business or accounting and then completing three years of law school. A tax attorney must also pass the bar exam in any state where they practice law. Before you hire a tax attorney, check their credentials to ensure they’re licensed to practice law in your state.
What does a tax attorney do?
A tax attorney is an expert in tax law and may help you if you run into trouble with the IRS or face an unmanageable tax obligation. Some tax attorneys specialize in business or corporate tax, while others have trained to help individuals with their tax problems.
A tax attorney can help you negotiate with the IRS, file paperwork to take advantage of the IRS Fresh Start Program, or represent you in an IRS audit. If you are facing IRS tax liens, tax levies, or even wage garnishment, a tax attorney can help. Finally, if you are going to court for tax fraud, failure to file your tax returns, or back taxes, a tax lawyer can represent you.
What is the difference between a tax accountant and a tax attorney?
A certified public accountant, or CPA, who specializes in taxes has different skills, education, and expertise than a tax lawyer.
A CPA has earned a business degree in a five-year program and completed at least 150 hours of education. A CPA has also passed the CPA exam and continues training with 120 hours of continuing education every three years.
Like a tax attorney, a CPA can help you negotiate tax problems with the IRS, file an offer in compromise, or file for currently not collectible status.
But if you’re facing an IRS audit or facing jail time for unpaid taxes, you’ll need a tax attorney to represent you in court.
Both CPAs and tax attorneys can help you with late tax filings and also help with tax planning.
Tax firms often hire both CPAs and tax attorneys, along with IRS enrolled agents, to provide the expertise their clients need.
What happens if I can’t pay the IRS?
If you can’t pay your IRS back taxes, you will receive an IRS CP501 notice, which is the first notice of unpaid taxes. If you can pay your amount owed immediately, you should do so to avoid further interest charges, penalties, or fines.
The IRS gives taxpayers many chances to pay their unpaid back taxes before taking further collections action. The tax bills will continue piling up if you ignore them. The IRS will always contact you through letters sent through the U.S. Postal Service.
Some of these may arrive via certified mail and require a signature. The IRS knows you’ve received the notices, so it doesn’t pay to ignore them. The interest and late fees will just continue adding up.
If you don’t pay after you receive your first notice, you’ll receive a CP502 Balance Due Reminder.
If you continue to ignore your tax notices, you’ll receive a CP503 – Second Reminder About Unpaid Taxes. You then have 10 days to pay your tax bill, or you’ll receive form CP504 – Intent to Levy State Tax Refund or Other Property.
If you ignore this tax bill reminder, the IRS can, eventually, move to seize your state tax refund or property. You might also face wage garnishment.
Before all this happens, though, you’ll continue accruing interest and late fees at a rate of 0.5 percent of your unpaid tax bill each month, up to 25 percent of your unpaid taxes.
It’s best to seek tax help immediately if you can’t pay your taxes, even before you receive your first notice of a late payment due.
Ignoring your tax problems won’t make them go away. But a tax company can help you pursue a solution that could eliminate penalties and reduce the total amount you owe.
Can a tax lawyer help release a tax lien?
If you received a Notice of Federal Tax Lien, a tax lawyer can help you file paperwork to appeal the lien and potentially have it released. If you can’t pay your amount owed and the appeal is denied, a tax lawyer may be able to negotiate with the IRS on your behalf.
What is a tax levy?
When the IRS issues a tax levy, it gives the agency permission to seize your property to pay the balance owed on your taxes. Property can include bank accounts, vehicles, real estate, and other assets.
What is a bank levy?
A bank levy gives the IRS permission to seize the assets in your bank account.
What is the difference between a bank levy and wage garnishment?
A bank levy occurs just once, while wage garnishment can continue until your IRS back taxes are paid in full.
How do I prevent an IRS levy or stop wage garnishment?
A tax attorney can help you file for relief to stop wage garnishment. Once you use the IRS Fresh Start program to file an offer in compromise, currently not collectible status, or an installment agreement, collection action and wage garnishment will stop.
Once you reach an agreement with the IRS, you won’t have to worry about wage garnishment unless you fail to fulfill the terms of the agreement and make your payments on time.
Can a tax attorney provide back tax services?
Most tax lawyers in the best tax attorney firms can offer a full range of tax services through the IRS Fresh Start program, including helping clients file for an offer in compromise, installment agreement, currently not collectible status, penalty abatement, or innocent spouse relief.
Many individuals owing more than $10,000 can find IRS tax help through a tax attorney.
Should I hire a tax attorney?
If you are facing unmanageable tax issues and experiencing stress due to your financial situation, a tax attorney may be able to help. Review our list of best tax attorney firms and be certain to find a tax attorney that offers a free consultation and has passed the bar exam in your state.
A tax attorney may be able to help you resolve your tax issues so you’ll pay less than you owe.
Get in touch with any of the firms above to put your tax problems behind you.You will start with a free consultation and then be able to quickly move to stop collection action, get protection, and then move to negotiate and find a solution.