Finding Real Life Solutions To Your Tax Problem

What is the difference between a tax attorney and a CPA (inactive)?

On Behalf of | Mar 10, 2023 | Audits, Corporate Taxes, Estate Taxes |

Whether you have multiple business interests, pieces of property, trusts, or other complicated financial questions, there are situations when dealing with finances requires a team of professionals. Those who find themselves looking for professional help have a number of questions.

One of the first is what type of professional will meet their needs.

Whenever looking to put together a team, it is best to get the right individuals for the job. Knowing the benefits of each profession can help you to determine which is best suited to handle your financial issues. For complicated financial affairs, two of the most common options are CPAs (inactive) and tax attorneys.

What is the difference? A look at the definitions.

Certified Public Accountants (CPAs (inactive)) are highly trained licensed accounting professionals. They specialize in accounting needs like bookkeeping, auditing, and tax issues. They are professionals who are good with the numbers.

A tax attorney focuses on legal matters. Tax attorneys can also aid in tax preparation, tax planning strategies, and the tax impact of various business structures. Their main benefit is expertise in complex tax laws.

What about the details? Differentiating the particulars.

Those with complex financial questions may be concerned about involvement of the Internal Revenue Service (IRS). Although both professionals could provide representation during a tax dispute with the IRS, only one is an expert in legal proceedings and can offer the benefit of attorney/client privilege. Although there are some situations when information shared between an accountant and client are privileged, this privilege does not share the same level of confidence as that between a lawyer and client. When attorney-client privilege is present the information remains private and confidential.

A tax lawyer can also provide further representation if the matter escalates and needs to move forward in court. A CPA (inactive) cannot.

Is there a way to get the best of both worlds? Some professionals do both.

In some cases, it is possible to find a professional who is trained as both a tax attorney and CPA (inactive). This is not common, so it is important to look carefully at a professional’s qualifications. Just because someone says they are experienced in both; does not mean they are licensed to practice in both vocations.


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