What Do Tax Attorneys Do?

Anna Kuehl
Expert Contributor
Last Updated:
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When you’re experiencing issues with taxes or the Internal Revenue Service (IRS), it isn’t always easy to know where to get the help you need. Depending on the problem at hand, you may need the legal advice that a tax attorney can offer, or you may need the experienced debt help that a tax relief service can provide. Don’t know where to start? Find out when to use a tax attorney, learn when you need help from a tax relief service, and discover how the two differ.

What Does a Tax Attorney Do?

Tax attorneys are lawyers who specialize in tax law. They have a high-level understanding of current and past tax codes, and they understand how the law applies to a wide variety of taxpayers. Tax attorneys may work with individuals, small businesses, large corporations, nonprofits, or a combination of entities.

To become a tax attorney, aspiring lawyers must earn a bachelor’s degree and a Juris Doctor (J.D.) degree before passing their state’s bar exam. Many tax attorneys develop one or more specialized areas during law school or while practicing law. They may deal exclusively with business owners and corporate taxes, or they may handle IRS issues for clients. Tax attorneys may provide select services for a flat fee, or they may charge an hourly rate for their services.

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How Tax Attorneys Help Business Owners

One of the most common focus areas for tax attorneys is business taxes. Some tax attorneys specialize in offering legal advice to new businesses, such as helping companies decide on the right entity type. After all, setting up a new business using the wrong entity type can have substantial tax and profit implications for your company. Tax attorneys can help you understand what the various business structures entail from a tax and legal perspective so that you can make the right decision for your company.

What Do Tax Attorneys Do?

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An experienced tax attorney can advise you whether it’s in your best interest to establish a corporation, a limited liability company (LLC), a limited liability partnership (LLP), or one of the many other business entity types. If you opt to incorporate your business, a tax attorney can walk you through the steps and ensure that you’ve completed all of the required paperwork and related legal issues. Even if you opt to do business as a sole proprietor, a tax attorney can advise you about how the IRS will tax your company, potentially helping you anticipate your company’s tax burden.

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How Tax Attorneys Assist With IRS Issues

Not all tax attorneys specialize in business-related issues. Many assist corporate and individual clients with IRS issues. After all, the U.S. tax code is incredibly complex and changes frequently, so it isn’t easy to interpret it without years of specialized experience. An experienced tax attorney may be able to save you from substantial late penalties or interest fees, and a lawyer may even be able to help you avoid jail time. If the IRS brings legal action against you or your business, a tax attorney can provide legal advice or even represent you in court.

If you learn that the IRS is reviewing your personal or business tax return or that you owe substantial back taxes that you weren’t aware of, a tax attorney can guide you through the process. Since these specialized lawyers understand the deadlines you need to meet and the most effective actions to take, they can make sure you’re putting your best foot forward with the IRS. Many tax attorneys can even communicate with IRS representatives on your behalf. Although hiring a tax attorney certainly comes at a cost, these legal professionals can help you save a significant amount of money and grief.

What Do Tax Relief Services Offer?

While a tax attorney can offer invaluable legal help, that isn’t always the answer to your tax woes. Instead, sometimes you just need help with back taxes or unexpected tax bills. In that case, tax relief services often have the solution you need. From tax consultations to tax resolutions and settlements, tax relief services offer essential assistance.

While some tax relief services may provide legal advice, their true area of expertise is debt relief. These services employ licensed tax professionals who specialize in tax debt relief, including enrolled agents (EAs) and certified public accountants (CPAs). These experts can help you tackle what might seem like insurmountable IRS debts.

Tax Consultations

When you seek help from a tax relief service, the first thing you’ll typically do is undergo a tax consultation. Many tax relief services offer consultations at no charge, so this can be a great way to assess the type of assistance the service can offer. Each tax relief company offers a range of services, so you can determine whether the available services meet your needs and your budget.

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Tax consultations tend to be brief, lasting about 30 minutes, but they’re essential to comprehending where you stand. During this introductory session, you’ll learn about potential solutions, and you’ll also get a better picture of your overall financial situation. You’ll find this information to be essential as you determine how to move forward with your tax-related issues.

Many taxpayers only need to complete one tax consultation before deciding to work with a tax relief service. Once you’ve found the right service for your situation, you’ll usually get to work by completing a standard tax authorization form and giving the service permission to begin working on your behalf.

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Tax Resolutions and Settlements

Tax consultations are just the first step toward IRS debt relief. A Tax relief service also offers a combination of tax resolutions and settlements to help you manage your debt effectively. These services come at a cost, and most tax relief services offer resolutions and settlements for a flat fee. Once you’ve signed on with a tax relief service, you’ll start working with your assigned agent on one of the following resolutions:

1) Installment Agreement:

This is an arrangement that your tax relief service negotiates with the IRS. This type of agreement allows you to pay your tax debt off in installments, usually over an extended period of time. That means rather than having to pay thousands of dollars right away, you could have up to three years to pay off your debt.

2) Offer in Compromise:

Unlike an installment agreement, an offer in compromise enables you to pay off your back taxes quickly, either via a one-time payment or a short series of payments. You won’t usually have to pay the entire amount you owe, however, because your tax relief service will usually negotiate a reduced tax bill on your behalf.

3) Currently Not Collectible:

If your tax relief service determines that you can’t afford to pay your tax debts, your agent may be able to convince the IRS to consider you Currently Not Collectible. Essentially, the IRS will postpone back tax collection for a predetermined period of time. That means you’ll have more time to get your finances in order, but you probably won’t have your overall debt reduced.

When you opt to work with a tax relief service, you’ll find that one of the biggest benefits is that you’ll have an experienced professional guiding you through the process. That means you can finally put tax problems behind you and move forward with a clean slate.

Do You Need a Tax Attorney or a Tax Relief Service?

So how do you know whether you need a tax attorney or a tax relief service to help with your financial issues? Check out some of the most common tax-related scenarios to determine which professional service is right for you:

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You Can’t Pay Your Taxes

Whether you can’t afford to pay this year’s tax bill or you’ve learned that you owe a staggering amount of back taxes, the last thing you’ll want to do is simply avoid paying your bill from the IRS. Instead, it’s often in your best interest to work with a tax relief service. These services evaluate your financial situation and use their vast experience to present you with all available options. They’ll also recommend effective solutions based on your debts and budget.

At Solvable, we know just how helpful tax relief services can be, as we know firsthand how challenging it can be to assess your options when you’re experiencing financial distress. That’s why we’ll make sure you understand your choices and help you find the ideal tax relief service for your situation.

You’re Negotiating Tax Payments

Whether you’ve been dealing with tax debt for months or for years, you may have already attempted to negotiate with the IRS. For instance, you may have requested an extension from the IRS, which grants you more time to file and pay your taxes. If you’re having trouble making the math work or if you can’t afford to pay by the extended deadline, however, a tax relief service can help. The best services have a comprehensive understanding of your options and can help you negotiate the most cost-effective deal.

You’re Being Audited

If you learn that you’re being audited by the IRS, your first instinct might be to panic. Even if you’re certain that you’ve always submitted accurate tax returns, it can be difficult to understand why you’re being audited and how you can make the process go smoothly.

To get experienced assistance with navigating an audit, it’s in your best interest to hire a tax attorney as soon as possible. These legal professionals can translate communication from the IRS, help you provide required documentation, and ensure that you don’t miss an important deadline or incur additional penalties and fees. If an audit results in a large back tax bill, a tax attorney can also help negotiate your payments and penalties.

You’re Under Criminal Investigation by the IRS

You wouldn’t want to address most legal issues without an experienced team of attorneys, and legal issues related to the IRS are no exception. The moment you learn that you’re under criminal investigation by the IRS, you’ll want to hire a tax attorney. After all, tax evasion and other criminal tax issues are very serious, and you’ll want to start taking proactive steps to defend yourself immediately.

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Keep in mind that most taxpayers whom the IRS charges with criminal issues end up having to serve time in prison or having to pay substantial penalties. Either way, a criminal investigation notice from the IRS should prompt you to contact the best tax attorney in your area right away.

No matter what type of tax issue you’re facing, now you know how to get the help and advice you need. Why wait another day to take action? Contact one of the tax relief companies we have reviewed for you on Solvable today and start putting those tax problems behind you for good.

Anna Kuehl
Expert Contributor
Last Updated: