Putting the words tax and attorney together is a formula for anxiety for many folks. The first thing to appreciate is that when you retain the services of a tax attorney, they will be there to help you. Whether you're trying to steer clear of trouble or worrying that you might already be in it, here's what you need to know about what a tax attorney actually does.
Confronting Bad Things
Regardless of what your situation is, the first thing a tax attorney will need to help you do is to figure out the full extent of your problems. If you haven't paid your tax bills and haven't been trying to obtain extensions, you need to establish exactly what it is you do owe and talk with someone at the IRS. This defines the line between tax evasion and just being behind on paying, so it's a big step.
Staying Clean
If you're not in any sort of trouble, an attorney can still help you stay ahead of your tax situation. You may be worried, for example, about the legality of setting a company up a certain way. Transferring money from one company to another during a merger can have major tax implications, and it's best to consult with a tax attorney before you move forward with restructuring to verify that you'll land on the right side of the law.
In some cases, you need to have a tax attorney do certain types of work. While a CPA can advise on how you might structure a company, you'll likely need to go to a law firm to have the actual paperwork drawn up, reviewed, and submitted. A tax attorney is also a valuable source of second opinions, and you can compare their suggestions against what your accountant is telling you.
Preparing for the Long Run
Let's say you want to set up an estate. That carries with it a lot of tax implications, and one of the biggest mistakes people often make during the process is not speaking with a tax attorney. Even with a good estate lawyer by your side, a tax attorney can explain the implications, for example, of giving the beneficiaries of your estate assets that might saddle them with massive bills from the IRS. You can then plan accordingly and see that there will be enough money in the estate to help them settle those debts.
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