Filing your taxes can be complicated, and you may need to seek professional tax advice to avoid making mistakes. Depending on your situation, you may need the advice of an accountant or the legal expertise of a tax attorney.
How do you know which professional is right for you? Consider your needs and the type of tax questions you have when deciding between a tax attorney and an accountant.
When an Accountant is Helpful
Accountants perform financial services such as bookkeeping(Bookkeeping services), preparing financial documents, and handling financial analysis and audits. They offer their services through accounting firms and private practice. Knowledgeable accountants provide businesses and individuals with tax advice and tax planning strategies.
Their training in tax regulation, tax codes, and financial planning makes understanding, preparing, and filing your taxes an easy process. They can help you find valuable tax deductions and benefits to take advantage of for more tax savings.
You should work with an accountant when:
- You’re newly married or divorced
- You’ve recently adopted a child
- Your live or work in multiple states
- You have foreign assets, including bank accounts, income, inheritance, or investments
- You’ve been audited or made previous mistakes on your taxes
- You’ve experienced the death of a spouse
- You’re caring for elderly relatives
- You’ve recently bought or sold real estate
- You’re paying college tuition for a grandchild
- You receive an inheritance
All these situations impact your taxes, and without the help of an accountant, you could be missing out on deductions and savings. Accountants are the best choice if you have questions about your taxes, your filing status, or just want to prevent making mistakes on your taxes.
When to Contact a Tax Attorney
Not all tax questions or problems can be handled by accountants. More serious and complex situations require the help of a tax attorney. Tax attorneys are lawyers that specialize in tax law. They have a deep understanding of the complex tax code and tax-related laws and regulations.
Some tax attorneys earn a Master of Law (LL.M.) in Taxation degree after completing their law degree to give their career an edge and better serve their clients.
Like accountants, tax attorneys help their clients comply with tax codes and take advantage of tax deductions, exemptions, and credits. But unlike accountants, a tax attorney can legally represent you in tax disputes. These include tax investigations, tax compliance, and tax litigation services.
A tax attorney’s knowledge is suited to more complex tax issues. Consider hiring a tax attorney if:
- You’re starting, buying, or selling a business
- You want to form an estate plan and leave money or property to your heirs
- You’ve been taken to court over your taxes
- Tax liens or levies have been placed on you
- You owe back taxes to the government
- You have offshore accounts
- You’re facing penalties for not disclosing assets
- You’ve been accused of tax fraud or other tax crimes
- You’re dealing with international tax laws
- You have the option of using Foreign Earned Income Exclusion
Tax attorneys and tax trial lawyers work on tax cases for individuals and large corporations. Experienced tax attorneys understand tax law in ways accountants do not. They can work with you to quickly and successfully resolve your tax issues.