What Can a Tax Lawyer Do for You?

Anna Chumakova
Expert Contributor
Last Updated:
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When dealing with IRS tax issues, you must proceed carefully to avoid any mistakes and misunderstandings. When resolving tax issues with the IRS, many complicated tax laws and legalities come into play. It is no wonder that taxpayers are typically uncomfortable dealing with the IRS and seek out a professional tax lawyer.

To avoid IRS penalties and potential criminal charges against you and your business, hire a tax law expert — such as a tax lawyer, a CPA (certified public accountant), or an IRS-licensed enrolled agent — to determine the right course of action for you. These individuals are trained and experienced in handling technical issues of the tax settlement procedure.

Understanding the Responsibilities of a Tax Lawyer vs. an Accountant

If you are looking for professional tax advice, your case will determine whether you need to consult an accountant, a tax attorney, or both. Each individual can help you, but tax attorneys are able to resolve certain situations that accountants are not equipped to handle. Let’s compare these professionals within the following categories.

Financial Advice

An experienced tax lawyer and accountant alike are capable of giving tax advice and devising financial strategies for businesses and individuals.

Court Representation

Both accountants and attorneys can represent their clients in tax courts, but only IRS tax attorneys are exempt from testifying against their clients, thus providing you with the attorney-client privilege. Attorneys are rigorous about confidentiality and don’t share private information, even with their fellow attorneys. In case of a trial, your CPA or tax preparer could testify against you.

What Can a Tax Lawyer Do for You?

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Having knowledge about financial planning, tax regulations, and codes, accountants are better equipped at financial strategy.

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A tax lawyer has a scope of practice that goes beyond assistance with income tax filings. Due to rigorous training in case law, research, and legal writing, attorneys have an advantage in specialized tax lawsuits, appeals, and questions of liability and are best at resolving intricate legal tax issues.

Dealing With the IRS

Taxpayers who miss important IRS deadlines may find themselves facing additional penalties. If you are having trouble communicating with the IRS, consult with an attorney to help you draft an effective letter to the IRS. Tax attorneys have experience dealing with the IRS on many issues. They can clarify confusing facts and possibly uncover misunderstandings which could have compelled the IRS to file a claim against you. Tax attorneys usually have direct access to specific branches of the IRS and are able to settle many issues over the phone.

Process Comprehension

While a CPA may know about tax settlement programs, only a tax lawyer has a full comprehension of tax settlement procedures, with all the technicalities and intricacies. A seasoned tax attorney will remain up-to-date on all tax laws and codes as well as qualifications for tax reduction programs.

Case Complexity

If you need help with basic income tax filing or business tax planning, consult with a tax accountant. Contact a tax lawyer to resolve complicated cases, liability or litigation cases, and cases affecting multiple parties. This point is particularly relevant for individuals being audited and fighting claims against themselves, their families, and businesses.

Scenarios Requiring Involvement From a Tax Attorney 

  • You are not sure whether to itemize your deductions or to use a standard deduction on your tax return. An attorney’s in-depth knowledge of the deductions applicable in your situation can help you easily identify possible ways of saving you thousands of dollars on your taxes. Determining which route to take with your deductions can be a complicated matter that only a tax attorney can handle.
  • Consider hiring a tax attorney in case of an audit by the IRS or when the IRS files a claim against you and you need defense in tax court.
  • You own an estate property and want to pass down your estate to your children after your death. Today, the total value of your property exceeds $5.5 million, or $11 million if you are married. Your children will owe up to 40% of the property value in estate taxes. A tax attorney can help you with estate planning in this situation.
  • When starting a new company, seek legal advice on the correct structure for your business. Setting up your company as an LLC or a sole proprietorship will determine its tax strategy and the amount of taxes you pay.
  • If you are doing business internationally, a tax lawyer can assist you in drafting contracts and advise on tax matters and other legal issues.
  • Hire a tax attorney if you want to initiate a lawsuit against the IRS, if the IRS began a criminal investigation against you, or if you want to appeal your case in tax court.

The Role of an Accountant-Attorney

If you are not sure who to consult, choose an accountant-attorney, a tax lawyer who is also a CPA. Such practitioners typically specialize in one particular area of tax law and charge higher fees, which are well-justified when dealing with your specific legal problem.

Why Do IRS Tax Disputes Happen?

When you don’t file tax returns, refuse to pay taxes, or conceal your income sources, the IRS can execute criminal charges against you, such as tax evasion and tax fraud. These charges come with tax fines, interest, prosecution fees, imprisonment, and public humiliation. Your information will be placed on the IRS website for everyone to see.

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If IRS agents arrive at your home for questioning, hire an attorney to protect your rights and help you present the information properly. Once the IRS files a case against you, everything you say could be used to your disadvantage.

The majority of tax disputes come in the form of an audit of your past tax returns. You must hire a tax attorney as soon as you get a notice of an audit. Your attorney will interact with the IRS on your behalf, be present during the audit, arrange a settlement, and make sure you don’t pay more than necessary.

Sometimes, people disregard any communication from the IRS out of fear and not knowing what to do. This behavior results in the IRS’s threats to process criminal charges for not paying taxes. If you find out that you are under a criminal investigation by the IRS, you must act quickly and hire a tax lawyer. A tax lawyer will convey to the IRS that you are serious about the investigation, will try to find a way to avoid criminal charges, and will represent you in court if needed.

Tax Dispute Settlement: Offer in Compromise

An offer in compromise (OIC) is an agreement between a taxpayer and the IRS to settle the taxpayer’s debts for less. The IRS will accept your OIC if it is convinced about one of the following criteria:

  • You aren’t able to pay in full within a reasonable time, even with installment payments.
  • Your tax debt amount is uncertain.
  • You will experience an “economic hardship” by paying full amount of your debt.

For such situations, the IRS’s OIC program can help you start over. The Streamline OIC is quite easy for taxpayers to handle on their own. If you don’t qualify for this program, think about hiring a tax lawyer to negotiate with the IRS. The IRS will decide on your OIC within two years. The more you owe, the higher the chances that the IRS rejects your settlement offer. For the IOC program, file IRS Form 656 along with the fee. For more information on the program, visit the IRS website.

Although a tax attorney will help with your OIC acceptance, make sure you understand how the IRS process works. For the IRS to identify your “reasonable collection potential,” you will have to disclose such financial details as your income, cash, credit, assets, and investments on IRS Form 433-A, Collection Information Statement. Your offer will consist of your assets’ “realizable value” and the amount of your future income that the IRS could collect. If the value of your assets is $30,000, and your future income amount available to the IRS is $20,000, then your minimum offer will be $50,000.

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The Cost of Hiring a Tax Attorney

Hourly Rate: Most tax attorneys charge an hourly rate that differs depending on an attorney. The typical range is $200 to $400 per hour. You can expect to pay more than $1,000 per hour if you hire a seasoned attorney or an attorney from a well-known firm in a metropolis area.

Flat Fee: A flat fee is typical for basic or standard cases. This one-time charge does not depend on the number of hours spent on your case.

An hourly rate can be appealing because you won’t pay more money if your case settles quickly. But if unforeseen complications arise, you could end up paying a substantial fee. Many people would rather pay a flat fee and thus lock in the price for legal assistance.

Although most tax attorneys charge by the hour, you could always ask for a flat fee. But know that a lawyer could refuse if the individual is averse to taking the risk of doing more work when something unpredictable happens.

Typical Fees for Attorney Services:

  • Installment Agreement: $750–$1,500
  • OIC: $3,500–$6,500
  • Penalty Abatement: $1,000–$2,500
  • Simple IRS Audit: $2,000–$3,500
  • Complex IRS Audit: $5,000 and greater
  • IRS Appeals: $5,000–$7,500
  • U.S. Tax Court Litigation: $10,000 and greater

These prices are the average prices that could vary depending on your location, the level of expertise of an attorney, and how intricate your case is.

Finding a Reliable Tax Attorney

Your problems could either be resolved or inflated depending on who you hire. Make sure to ask the right questions to identify the best attorney you can find, someone you can trust and rely on to defend your rights. The wrong advice could be detrimental to your future.

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Gather Information

  • Learning how long the firm or the individual has been practicing law will tell you how experienced the firm or the attorney is. The professional you hire must be comfortable working with the IRS.
  • Beware of sales techniques and sales pitches as they point to the attorney’s inexperience and lack of skills.
  • Find out whether you are expected to pay a full up-front amount or in portions. A reliable attorney will typically ask for a deposit but won’t make you pay a full up-front amount.
  • Find out whether the attorney specializes in tax law or practices other areas of law as well and whether the individual has worked on cases similar to yours.
  • Have the attorney assess your situation, give you recommendations, and estimate your legal expenses.


At the minimum, a tax attorney must have a Juris Doctor degree, a J.D., and have passed the state bar examinations. Advanced training in tax law is desirable as is a tax attorney with a Master of Laws (LL.M.) in taxation.

Sometimes tax attorneys have occupied accountant roles previously in their careers. Although they typically don’t handle tax returns, attorney-CPAs can be of great value for complicated accounting cases. Typically, their charges are higher but well-justified.

What to Do If You Cannot Afford an Attorney

Do it yourself: If hiring a professional is not in your budget, do not despair. Take advantage of many available resources, such as various online courses and step-by-step guides, for specific tax problems and learn how to resolve your tax situation yourself.

Find a tax clinic: Low-income taxpayers can seek help from tax clinics offering free or low-cost legal counsel. A full list of tax clinics can be found on the Taxpayer Advocate’s website.

Although a tax attorney is the individual to consult once you are facing a situation with the IRS, it is a good idea to ask for an attorney’s advice ahead of time to prevent such situations. Don’t wait to hire a tax attorney until you are being audited or investigated by the IRS. Ask a tax attorney to help you save money on your taxes, strategize for your business, and assist you with estate planning. If you are experiencing tax problems, contact Solvable and learn about tax debt relief programs available to you.


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Anna Chumakova
Expert Contributor
Last Updated: