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How to Know Whether You Should Hire a Tax Attorney or a CPA

How to Know Whether You Should Hire a Tax Attorney or a CPA

From needing help with an IRS conflict to finding yourself in a dispute, here are three answers to the question, "Can you share your best reasons for hiring a tax attorney versus a CPA this tax season?"

  • You Are Facing a Tax Controversy With the IRS

  • You Need Unmatched Legal Expertise

  • You Need Help Negotiating a Dispute

You Are Facing a Tax Controversy With the IRS

The only time I recommend that my business clients hire a tax attorney instead of a CPA is if they are facing a tax controversy with the IRS. A tax controversy is another phrase for a dispute with the IRS concerning any matter connected to your tax return or liability.

For example, the IRS may audit your business and find you owe additional taxes. If you contest that finding, you will need to hire counsel to defend your position in court. Of course, attorneys are expensive. So I recommend my clients work with a CPA on all tax-related matters that are not disputes, such as preparing and filing annual returns.

You Need Unmatched Legal Expertise

When you're talking tax disputes and fighting it out with the IRS, you know you're always better off with a tax attorney. Legally, even a CPA can represent you when sorting out tax troubles with the IRS. Still, as far as specific legal expertise is concerned, you will find yourself in a far better position by hiring the services of a tax attorney.

Whether it's an independent review you wish to set up, or a legal fight against tax fraud, seeking legal help from a professional is always a better idea. The fact that anything you share with your attorney is privileged and private information means you can also rely more on an attorney when you're anticipating tax trouble.

Riley Beam, Managing Attorney, Douglas R. Beam, P.A.

You Need Help Negotiating a Dispute

By nature of their profession, tax attorneys are better skilled at handling negotiations than CPAs, who are more analytical and will only offer data-backed insights you need to act on.

If there is a tax dispute, tax attorneys will use their negotiation skills to help you reach a solution with the IRS, thus avoiding escalations that could tarnish your brand or cost your business more money.

Liam Liu, Co-founder and CMO, ParcelPanel


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