Taxes are a source of confusion for many people, as is knowing which professional in the industry should help with their situations. Each expert carries a different area of expertise. Go here to see how the two professions differ.
For instance, a certified public accountant – CPA, deals in the accounting and financial aspects, while a tax attorney carries a specialty in the tax codes, laws of taxation. These distinct differences can decide which is better suited for an individual’s needs.
While CPAs are associated with completing client tax returns each year, the accounting expert would be out of their element when faced with law-related issues, including errors on returns creating an IRS debt.
An attorney would communicate with the government body to negotiate the circumstance and possibly have the debt removed or reduced.
Because of their specialty, tax attorneys in Atlanta could also be able to advise on the state’s tax codes or laws if a small business had a concern but would help those companies with foreign tax systems if they decided to work globally.
Let’s look at the two professions more in-depth to help you become more informed, allowing for easier decision-making.
What is a Certified Public Accountant
A certified public accountant – CPA is a financial and accounting expert who can earn either a bachelor’s or master’s degree in accounting, depending on how far they wish to extend their expertise. After receiving their degree, the national CPA exam must be passed.
This is issued by the American Institute for Certified Public Accountants – AICPA and covers the material taught in college that is mandatory for becoming a functioning CPA.
The professional must obtain added training to receive a license within their state and gain pertinent experience to perform in the industry. Typically, that experience would include working for roughly “1800 hours under the management of a seasoned and licensed CPA.”
This will establish working knowledge and develop a skill set. While working in the field, the accounting expert must continue their education by completing “120 hours of added coursework every three years.”
Go to https://www.ramseysolutions.com/taxes/tax-advisor-what-to-look-for for guidance on what to look for in a tax advisor. While working in a variety of roles, whether for private individual’s returns or organization’s accounting, primary duties include the following:
- Return prep/filing or other accounting services
- Preventive measures for fraud
- Credit/deduction eligibility
- Accounting decision making (accrual/cash)
- Managing business expenses/financial documentation
- Business dealings, including merges, tax structures
- Budgeting guidance
- Loan acquisition for startups/small business
- IRS audit assist
- Strategize for financial risk management
While these experts help private individuals and businesses work through varied tax situations, some circumstances warrant the guidance of a tax attorney.
What is a Tax Attorney
An Atlanta lawyer or attorney specializing in the US tax code and tax laws will assist those with tax-related legal concerns. An attorney prerequisites their training with a bachelor’s degree, some choosing a business degree in preparation for the analysis and critical thinking required in law.
A JD or Juris Doctorate must be earned, followed by a Master of Laws in Taxation or LLM, depending on how far the professional wants to extend their education.
The state bar is a “two-day assessment” a prospective lawyer must pass within the state they wish to practice. Click for recommendations on how to find the best tax attorney.
Once all criteria have been met, the bar has been passed, a tax attorney will be able to provide varied services, the least of which include the following:
- Levy/levy removal, such as property liens
- Tax-related legal issues
- Advising on tax relief considering attorney/client confidentiality
- Wage garnishment resolution
- Foreign tax advising, including overseas business dealings
- IRS negotiations for private individuals
Annual returns aren’t completed or filed by a lawyer, nor are they involved in financial services or monetary aspects. The best position for the attorney is from a legal standpoint, including tax negotiations with government authorities.
What Can You Expect from CPAs and Tax Attorneys
Briefly summarizing each position will help you decide which professional you will need for the circumstances you’re experiencing.
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Expertise
A CPA is experienced and credentialed in financial matters like financial planning, accounting, bookkeeping, auditing, tax planning, and on.
A tax attorney specializing in tax codes and laws works to resolve and navigate the legal side of the industry.
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Court
A CPA’s certification does not allow the financial expert to represent private individuals in the Tax Court; the certificate restricts working with clients within their state.
An attorney has certification for practicing law and can represent private individuals and businesses in Tax Court, where they frequently work to optimize the outcome of disputes. When you face severe consequences like evading taxes, attorney representation is vital.
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The investment
These roles are distinct, as is the cost difference. A professional’s price point will depend primarily on their experience level, the scope of the situation, and the solution required.
Typically, a lawyer’s hourly rate will be higher than that of a CPA for tax solutions. Learn reasons to hire an attorney at https://www.solvable.com/tax-help/tax-attorney/when-to-hire-an-irs-tax-attorney/.
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Discretion
An attorney has an attorney-client confidentiality they are bound to, legally requiring that all matters remain discreet, a primary consideration in cases where private individuals or businesses have issues that breach compliance limits. CPAs are not legally bound to that same legal confidentiality requirement.
Final Thought
When a private individual in Atlanta needs annual returns prepared and filed, a CPA would be the tax professional to contact. This expert will help with filing errors, difficulties comprehending tax brackets/rates, and routine accounting issues.
Attorneys in the state would be more appropriate when a private individual or business has an IRS investigation, faces criminal charges related to breaches in tax laws, or any tax-related dispute with a government authority.
The one to hire will depend on the solution needed. Sometimes, a company that employs both might be beneficial, one for the financial aspects and the lawyer to handle the legal part. Read everything to know about selecting tax lawyers here.
In either situation, you’ll likely receive a free consultation to decide if the services suit your particular circumstances.
