A tax attorney and CPA offer similar but different tax and financial planning services. A certified public accountant can help resolve the numbers whi
A tax attorney and CPA offer similar but different tax and financial planning services. A certified public accountant can help resolve the numbers while an attorney offers answers to ambiguous financial questions.
What Is a CPA?
A certified public accountant typically has over 150 hours of intensive higher education. They also have a bachelor’s degree in business records and finances. A CPA will typically have over 5 years of a college education.
A CPA must complete four parts of the CPA examinations covering:
- Financial accounting and reporting
- Audit and attestation
- Regulation
- Business environment and concepts
CPAs also understand federal and state tax and finance laws and can help you comply with the regulations that apply to their certification.
These professionals are held to a high standard due to their intensive training and significant impact on business or individual finances.
A certified public accountant is widely recognized and trusted because they must abide by the AICPA professional code of conduct or lose their license.
Tax Attorney
While a CPA excels in business and financial records, a tax attorney is an expert in negotiation, litigation, and other angles of tax law. A tax attorney is also trained in math, business, or accounting up to a bachelor’s degree.
They must also take the Law School Administration Test to determine their analysis, reasoning, and reading comprehension regarding legal work. Some tax attorneys may also have advanced degrees in tax law.
A licensed tax attorney must also pass the state bar exam, which maintains strict guidelines that all attorneys must follow to keep their licenses. All tax attorneys are also required to continue their education on legal topics to ensure the bar membership remains active.
These professionals may assist you with tax returns and, occasionally, other accounting tasks at a fee. However, tax attorneys have different skills than CPAs and may be unable to assist you with tax disputes, business tax law, and estate planning.
A tax attorney can offer you legal counsel that a CPA cannot practically or ethically offer.
Do You Need a Tax Attorney or a CPA?
Your tax needs determine which professional to hire.
CPA for Business and Accounting
You may need a CPA for the accounting and business side of taxes, such as:
- Filing taxes
- Determining tax deductions and credits
- Payroll management
- Budgeting and financial planning
- Staying updated on tax reforms and tax law changes.
- Mergers, sales, or acquisitions
- Business loans
- Determining ideal business structures for your needs
- Determining accounting methods such as cash or accrual
- Financial risk management
- IRS audits
- Fraud prevention
- Minimizing tax liability
- Scheduled accounting.
- Marriage, inheritance, divorce, or other life changes that have tax implications.
A CPA can also represent you or your business in negotiations with revenue officers and the IRS. In addition, some CPAs can litigate and help with tax controversies involving the U. S. tax court.
Depending on your needs, always ask the accountant if they are qualified to offer legal help in areas such as:
- Large amounts in back taxes
- Levies or liens because of unpaid taxes
- IRS negotiations
- Estates or trusts
- Wage garnishment
Of course, if you need representation in court or written legal advice, you should always hire a tax attorney.
Hire a Tax Attorney for Legal Counsel and Representation
You should hire a tax attorney if you need help with the following:
- Cases involving tax agents or revenue officers.
- Unpaid taxes
- Investigation for tax fraud
- Revenue officers auditing your business or personal tax returns.
- Assets getting levied.
- Negotiations with IRS agents
- Negotiating legal settlements with clients’ tax disputes
- Documentation of financial records
- Defense based on legal precedence and your specific situations.
- Researching national and state tax laws
- Seeking advice from other legal professionals concerning tax cases
Prevention vs. Intervention
Tax attorneys and CPAs can help with financial decisions, planning, and preventing or minimizing tax penalties. However, a certified public accountant is more helpful in preventing tax problems, while a tax attorney can provide legal advice and intervention.
A tax attorney can represent you or your business in cases involving tax defense, significant tax debt, and other problems. Most lawyers can review your case at no cost and help you determine whether you should hire a tax attorney or a CPA.
In addition, when you hire a tax attorney, your conversations are protected by attorney-client privilege. If there is potential for criminal charges, your tax attorney cannot be forced to testify against you.
A CPA is best suited where you need a tax professional for accounting and tax preparation. They can help you prevent legal concerns and IRS disputes. A CPA is also ideal if you require help with complicated tax situations.
Find the Right CPA or Tax Attorney for Your Business
It is critical to find the right professional for your needs. For instance, if you are looking for a professional to help with a family trust or LLC, look for a CPA with similar experience. You should also be comfortable with the professional you choose, as you may likely hire them for years.
When choosing a tax attorney, ensure that they specialize in the area that meets your needs. Tax law is complex, and many attorneys often specialize in one area. It is important to determine which tax attorney to hire to ensure that the job is done effectively.
Whether you are looking to hire a CPA or a tax attorney, being proactive is always better than waiting to solve problems when they arise. Always ensure that you have a CPA or tax attorney on retainer for consultations depending on your needs. Get in touch with a CPA or tax attorney to find the right fit for your business.
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