The tax season can be a challenge for most businesses and individuals. Filing taxes is a daunting task, especially if you are unsure of what to include. It’s therefore essential to get the right help when you find yourself in this position.
The two most popular options are a Certified Public Accountant (CPA) or a tax attorney. However, it can be challenging to know if a CPA or a tax attorney is the right choice. The right choice depends on your goals, unique needs, and your status with the Internal Revenue Service.
Hiring the right professional is crucial to ensure you don’t fall behind with tax filing and payments for your North Carolina business. Read on to learn the difference between a tax attorney and a CPA and who best suits your case.
A tax attorney is an expert in legal matters related to filing taxes. They understand the ins and outs of the IRS tax code and can help you with anything from developing a plan for your business taxes to representing you in court.
Tax attorneys offer business guidance and represent you in legal matters like audits and disputes with the IRS and other federal tax authorities. They can provide advice and guidance on complicated legal issues, including estate planning, tax disputes, business law, and trusts. Just as most other attorneys specialize in working with certain types of clients, tax attorneys can specialize in certain verticals or types of clients, so make sure the tax attorney you choose is a good fit for your organization.
One common skill between tax attorneys is expertise in dispute resolution. Tax lawyers undergo years of training to help you go up against federal tax authorities like the IRS during adverse tax actions. Although most are skilled in dispute resolution, if you are in a tax controversy situation, it’s important to find an attorney that specifically works in that area like Wilson Ratledge.
The following are various reasons why you may need to consult a tax attorney:
- Criminal tax investigation and defense
- IRS tax audits
- International business transactions
- When starting a business and require legal guidance on the tax treatment and your company structure
- You have a lawsuit against the IRS
Certified Public Accountant
Unlike tax attorneys, CPAs are educated in maintaining business and financial records. They help you avoid tax filing problems while tax attorneys work to help you straighten problems that have already occurred.
CPAs help you follow the tax code, file and correct your tax returns. They know how to abide by federal laws and will help you maximize your tax benefits while lowering your tax liability.
It’s essential to develop a strong relationship with a CPA, especially when you have a large amount of money coming in and out.
You need a CPA in the following situations:
- Filing taxes
- Managing payroll
- Creating financial risk management strategies
- Undergoing an IRS audit
- Finding tax credits and deductions, you qualify for
- Acquiring, merging, or selling a business
- Determining the proper business structure
- Choosing between accrual or cash accounting
- You need help figuring out a long-term tax plan
Do You Need a Tax Attorney or CPA?
If you still are unsure whether you need a tax attorney or CPA, consider your tax situation. If you have complicated business or personal taxes and want to minimize tax liability, hire a CPA. If you are in trouble with the IRS or dealing with a tax controversy issue, a tax attorney is your best fit. Remember, don’t hire a tax attorney when you need a CPA. This will create more trouble and will cost you more than it would initially.
A tax attorney will help you in tax planning to minimize your tax liability by structuring your assets. If you only need help with tax preparation and filing and have no trouble with the IRS, consider hiring a CPA.
Confused and Overwhelmed? Wilson Ratledge Can Help
Taxes can be daunting. Understanding your tax situation will help you choose between a tax attorney and a CPA. While tax lawyers provide legal advice, CPAs help you in tax preparation and avoid tax filing problems. If you have an overwhelming tax situation that you don’t understand, contact Wilson Ratledge today to schedule a consultation.