What Does a Tax Lawyer Do?

According to IBISWorld, there are 3,836 tax lawyers and attorney businesses in the US as of 2023, an increase of 1% from 2022. But what are tax lawyers and what do they do? Tax lawyers offer legal counsel and representation to individuals, businesses, and organizations with matters pertaining to taxes. The U.S. Bureau of Labor Statistics (BLS) said that the average lawyer makes $127,990 a year.

Due to the intricacies of tax laws becasues of the associated compliance and litigation and the need for tax planning, the demand for tax lawyers is generally stable. CPA Lawyer Angie Smith, Esq says that tax lawyers not only help individuals or businesses with matters related to taxes, they can also assist in estate planning related issues, business structuring, and corporate reorganization.

By the end of this article, you will learn the details of what a tax lawyer does, with a focus on their key role in handling tax matters.

Responsibilities of a Tax Lawyer

When you are employed as a tax lawyer, your top duty is to help your clients deal with issues touching on tax laws as well as legal guidelines. You are to assist people and companies in know their laws so that they can fully comply with or advocate for their rights. In this capacity, you make sure they respect the law without exposing themselves to multiple risks and consequences in the process. This entails the scrutiny of accounting records, investigations and evaluation of the various outcomes with a view to formulating strategies that are most appropriate according to the client.

You are also involved in legal proceedings by providing legal help and advocating for clients in tax issues and related administrative interactions. You may be involved in tasks such as appeals, writing letters and other communication regarding clients’ cases, and fighting for fairness in the awards. Their ability and knowledge in tax law enable you to respect their rights and guarantee that they will be treated fairly.

Tax Planning and Compliance Services

Tax lawyers primarily deliver services that involve helping with tax advice and ensuring that customers are able to meet legal requirements. Tax planning is a complex process of seeking ways to pay less tax than is provided in the legal conditions. They advise clients on legal matters and propose possible deductions, credits, and effective ways to structure their dealings. Performing research in advance helps consultants avoid major losses among their clients.

Tax lawyers make sure that the clients are in line with the taxes as well as other laws so that they don’t have to incur fines or go to court. They help in the completion and verification of financial statements, make recommendations on the consequences of specific economic actions and decisions, and update them on changes in legislation.

Tax lawyers are of great assistance to clients in ensuring that they understand the requirements provided by these regulations to make the appropriate changes to their returns while at the same time ensuring that they do not violate any of the set laws.

Representation in IRS Audits

When ordinary citizens are audited by the IRS, tax lawyers come in to deal with these legal matters arising from tax law. In cases where you are dragged to the IRS audit, involvement of a lawyer is useful since they appreciate more regulations and can avert any denial of your laws.

A tax lawyer in IRS cases can talk to the IRS for you, deal with all the papers, and assist you in interactions with IRS officers. They have the experience to understand your individual circumstance as well as the ability to provide you with clear information about taxation issues to make the process smooth.

The tax lawyer will assist in compiling documentation supporting tax positions, proffering in writing and presenting valid reasons for the IRS to accept the positions, and using applicable legal options to seek an appealing compromise from the IRS. It is always helpful to have an attorney speak for you during an IRS audit, since this would reduce embarrassment and maximize chances of a favorable outcome.

Tax Litigation and Dispute Resolution

Specializing in the field of tax law, a lawyer works to represent clients in legal cases that involve either tax litigation or dispute resolution. In this respect, they intervene in order to defend your rights and those of your business when you are in a disagreement with the IRS or any other tax agency.

They also work on various matters, including tax, audits, appeals and litigation concerning taxes in the tax court. For instance, after accumulating enough knowledge in laws and regulations, they are in a position to adequately plan for the most appropriate strategies to arrive at the most favorable solutions to the conflict.

Tax litigation may involve not only a lawyer's time but also may take time to complete, depending on the merits of the case. As your tax lawyer, they investigate the facts of your case and formulate legal opinions and arguments, as well as engage in negotiations with or petition the other side. A lawyer dealing with taxes plays a key role in defending the client and ensuring the optimal solution possible in cases where there are challenges in assessment, penalties, or even fraud.

Advice on Tax Implications

Any time you have to seek legal advice on this kind of issue, a tax lawyer can be of great help. They will be able to understand your case better in terms of the law. The consequences may not be straightforward and will depend on the type of income as well as investment and deductions allowed for on the return form or new laws enacted during the year. I counsel my clients on these matters and assist them in comprehending how various decisions, financial or otherwise, may be inclined to affect their taxes.

Whether you run a sole proprietorship, a business or corporation, a partnership, or are involved in consolidations or mergers, a tax lawyer can guide and advise you on how to structure your business deals to reduce tax risk legally. They assist in preparing and advising on the most effective legal structure of your estate or investment/business. This is an advantage to the business because it is able to reduce unnecessary expenses on taxes while avoiding legal problems with the authorities on tax matters.

Conclusion

The tax lawyer is a very important lawyer in working with other experts to ensure that various people and corporations understand well the tax laws that exist within the country and recommend their adherence to avoid falling on the wrong side of the law.
A lawyer will be instrumental in advising on the applicable laws and regulations and providing a solution to tax-related issues such as planning, audits, and litigation. If you’re having issues with tax-related matters, seek advice from tax lawyers near you.