In order to maintain compliance with tax rules, lower tax liabilities, fend off audits, and collect all allowable tax credits, people and corporations can benefit from the assistance of tax lawyers. They offer guidance to both people and businesses in all tax-related concerns and defend clients against IRS fraud allegations. Get to know more about the tax lawyer and how the function.
What do They do?
People in tax attorney roles frequently do the duties listed below:
- Prepare individual or business tax returns: make ensuring that eligible deductions are used, calculate taxes due, and ensure that applicable tax regulations are followed.
- Find and list the ways that eligible credits, itemized deductions, or reported operational expenses can lower tax obligations.
- Assist with audits and represent clients in court cases brought by the IRS or a state or local tax collection agency.
- Provide guidance on the tax, legal, and business ramifications of various business decisions, like incorporation, new partnership formation, mergers, or acquisitions.
- Aid in ensuring that money transferred as a result of divestitures, profit distributions, capital gains and losses, and retirement payments are properly reported.
How it goes
Tax lawyers are accountants and attorneys who focus on providing tax law advice to both people and corporations. Tax lawyers can assist with tax filing when working with individuals, but more frequently, their services are created to make sure that people take full advantage of all available tax burden-reduction options. They might suggest saving receipts for itemization for the following year, suggest a sole proprietor switch to an LLC, or suggest tax credits the person might be eligible for.
Additionally, tax attorneys assist firms with the allocation of funds in mergers, acquisitions, and bankruptcies as well as with the reporting of incoming and outgoing monies. Businesses frequently have a lawyer on staff or have a retainer with a tax law firm to help with problems and regulations because business tax law is significantly more complex than individual tax law. Tax attorneys have a significant impact on the formation of these partnerships when a corporation is exploring an acquisition or merger.
The provision of legal advice in the case of an audit or other more involved actions is the second significant function that tax lawyers perform for both people and businesses. Tax attorneys can assist clients in dealing with the IRS during an audit, can appeal decisions, and can represent clients in court. Tax lawyers may be able to negotiate with the collecting agency to establish payment schedules or decrease amounts owed when high tax amounts are owed to local, state, or federal governments.
Standard Work Schedule
During regular business hours, the majority of tax lawyers maintain full-time schedules. This position may demand overtime, particularly in the first few months of the year when people and businesses are paying their annual taxes. The majority of tax attorneys can distribute their workload evenly throughout the year, though, as the majority of firms are obliged to file their taxes on a quarterly basis.
The Big Four accounting firms—Deloitte, PricewaterhouseCoopers, Ernst & Young, and KPMG—are a good source of employment for many tax attorneys. Others work for private tax law firms; they might be sole practitioners, partners in firms run by other attorneys, or employees of firms run by other attorneys. Some may also be retained on staff for particular businesses with significant tax requirements.
Ways to Become a Tax Attorney
A bachelor’s degree in business, finance, or accounting is typically required to start a career as a tax lawyer. Afterward, they proceed to sit for the Certified Public Accountant (CPA) licensing examination in order to become licensed accountants. Most states need 150 hours of undergraduate education prior to sitting for the CPA exam. The American Institute of Certified Public Accountants administers the four-part CPA exam for all 50 states. For the CPA certification to remain valid, most states additionally have ongoing education requirements.
The next step after earning a bachelor’s degree and obtaining a CPA license is to apply for and start law school. The majority of law school programs last three years and lead to the Juris Doctor (J.D.) degree. A J.D. is necessary to appear for the bar test, and passing the exam is needed to be granted state legal practice licenses. In the states where they reside, tax attorneys typically have licenses allowing them to practice as both accountants and lawyers, and maintaining both credentials typically necessitates ongoing study.
Although it is possible to start a private tax attorney practice directly out of law school, the majority of tax lawyers start their careers working for other lawyers to get experience in the field before going it alone. However, if you made money by doing taxes for individual clients while in law school, it wouldn’t be too difficult to grow that business after graduation and provide legal and tax preparation services.
Data on Tax Lawyer Pay
The average annual salary in the United States is $136,260 while the average wage per hour for this job is $66. The information given above is from the U.S. Bureau of labor statistics.
How much do Tax Lawyers make when compared?
Tax lawyers can earn an average yearly compensation of $136,260, or $66 per hour, according to the most recent data on employment across the country. At the low end, individuals can earn $76,300, or $37 per hour, possibly when they are just starting out or depending on the state they reside in.
How has the growth of jobs for Tax Lawyers compared to other jobs?
By 2024, there will be 822,500 people working in the field nationwide, which means that 43,800 positions will change. This translates to a growth change of 5.6% during the ensuing ten years, providing the career a higher growth rate than the national average.