tax law

When Should You Hire a Tax Attorney?

Although every working United States resident has to file taxes on an annual basis, the filing process causes many taxpayers terrible distress. If you have run into tax issues, you may be wondering whether you need to bite the bullet and hire a tax attorney to help you resolve these issues within the confines of the law.

For minor tax issues, hiring an attorney is often unnecessary. It is the larger problems and discrepancies that require the help of a skilled legal adviser, as they can save you a lot of time, money, and stress. To help you determine whether your tax issues require the help of an attorney, Pearson Butler recommends that you consider the following questions:

  • How much money do you owe to the IRS?

If you owe the IRS more than $50,000, it is a good idea to seek the help of a legal professional. This depends on the person, however, as your comfort level for owing money to the most powerful debt collection agency in the nation may be breached by a $50,000 debt.

  • How comfortable are you speaking with an IRS revenue officer?

If you are dreading speaking directly to an IRS revenue officer, a legal representative can do so on your behalf. You do not have to lose sleep over how you will negotiate with a revenue officer on your own.

  • Are you self-employed or the owner of a small business?

Tax matters become more complicated when you are self-employed, a freelancer, or a small business owner. In addition, the more streams of income you have, the harder it can be to keep track of everything and make sure it is all correctly reported on your tax return. Therefore, if any of these categories apply to you, it is best to seek legal counsel before proceeding.

  • Are there issues of tax fraud, such as unreported income?

When there is tax fraud involved, it is wise to hire a lawyer to protect your rights. Trying to sort out issues of tax fraud on your own is hardly feasible — after all, the reason why it takes years to become a lawyer is that learning how to sort out such issues takes a long time and requires a specific set of skills.

  • Are you willing to dedicate time to figuring out issues and filing forms on your own?

For tax issues besides fraud, it is possible to figure it all out on your own, but you will have to spend a lot of time researching and reading to ensure that you are filing the correct forms in the correct way. Make sure you have the time, patience, and detail-oriented mindset to do so. Please note: The more complicated your case is, the better it is to hire a lawyer.

Do I Ever Absolutely Need to Hire a Tax Attorney?

There are some cases in which hiring an attorney becomes essential, such as if the following applies to your situation:

  • There are indications of tax fraud;
  • You owe the IRS more than $1,000,000; and/or
  • You have confidential, undisclosed foreign bank accounts.

What Does a Tax Attorney Do?

If you decide to work with a legal professional to resolve your tax issues, they will assist you in analyzing your current situation, negotiating with the IRS on your behalf, filling out and submitting paperwork, and more. Lawyers do not handle minor questions, however. So, if the problem is that you only need to amend your tax return, a certified public accountant (CPA) would be the more appropriate tax professional to get in touch with.

At Pearson Butler, our staff includes both attorneys and CPAs who are prepared to assist you with your tax-related troubles. To schedule a free consultation, contact us online today.