Should You Hire A Tax Attorney Or Accountant?

As far back as the Roman Empire, people were taxed and each year the Empire found new and creative ways to tax people.  

 

If that sounds familiar, consider the fact we have over a 100 kinds of taxes. A few of them are; income tax, federal income tax, sales tax, property tax, estate tax, gift tax, capital gains tax, hotel and air transportation tax, biodiesel tax, building permit taxes, business registration taxes, disposal taxes, driver’s license, Medicare tax, social security tax, federal corporate taxes, unemployment taxes, fishing license taxes, dog license tax. The old joke “where there’s a will there’s an inheritance tax” isn’t that funny anymore.

 

The tax system has become so complicated there are over 100 different tax forms from the Internal Revenue Service (IRS). The IRS “guide” for earned income tax credit is 37 pages long and so difficult to understand, 27% of the forms have errors when turned in.  

 

The IRS tax code is over 10 million words long - around 75,000 pages of tax code!  

 

Most everyone agrees we all have to pay our fair share of taxes, but they should be fair and simple. We don’t have simple. There have been proposals for flat tax, consumption tax and a fair tax, but all have died a little death in Congress.

 

We’ve seen the commercials for the do-it-yourself tax software, but if you have any itemized deductions or go beyond a very simple W2 form - beware. You may regret the ‘simple’ software when you receive a notice from the IRS in the mail.

 

When it comes to taxes, you can never be too careful or too organized. Typically businesses rely on tax professionals to take care of the tedious details but nowadays more people are using the professionals.  

 

Should you use a Tax Attorney or an Accountant?

 

Tax attorneys are lawyers - they specialize in the minute details of the IRS tax code and can use the court system that provides leverage in resolving tax cases. A tax attorney holds the client-lawyer privilege, meaning what you discuss with your attorney prevents your attorney from testifying about and/or being forced to testify about their client’s statements. Tax attorneys are skilled in negotiation and are trained to analyze complicated tax information and create a plan to resolve your case. Tax attorneys are up-to-date with the yearly changes in laws, estate planning and related tax returns, business start-ups, payroll/employee tax issues, IRS lawsuits and investigations against you. They will represent you for tax issues such as tax fraud, tax audits, unpaid back taxes and not filing taxes.

 

The accountant can help you if you have fairly simple expenses, income and deductions. Accountants have different levels of education from a tax preparer certificate to having a Certified Public Accountant license. An accountant can help prepare taxes and prepare forms whereas a CPA can help you with financial planning, asset management or audit assistance. Most states require 150 semester hours of study to become CPA-licensed. You should remember that accountants are not well trained in the legal aspects of tax law.

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For the most tax-liability protection, tax benefits, and client-confidentiality, we recommend hiring an experienced tax attorney. A tax attorney that has extensive knowledge in trusts, as well as tax law, can further decrease your tax liabilities. Many tax lawyers are comparable in price to accountants. To schedule a consult of your case with the tax lawyers at Gantenbein Law Firm in Denver, Colorado, call 303-618-2122.