Tax lawyers can be of immense help to you in dealing with sticky financial situations and even starting a business. We know how difficult managing your taxes can be. A tax lawyer can help you with all the complex, and sometimes boring work.
So, what are you waiting for? Read this article to find out the answer to any question that you may have.
Let’s dive in.
Table of Contents
What Is A Tax Lawyer?
A tax lawyer is someone who has received training in tax law. Also known as a tax attorney, a tax lawyer, has a lot of knowledge in the complex and ever changing field of taxes. A tax lawyer gives advice to the clients on how to tackle difficult tax laws, and possibly save up a hefty amount of money by taking some benefit of the acceptable deductions. Moreover, tax lawyers also assist individuals and various organizations in a situation where an investigation by the Internal Revenue Service (IRS) is required.
In addition to this, tax lawyers do a lot of inquiries and conduct meetings, in order to describe to their clients, the complexity behind local, state and federal tax laws. This requires exceptional written and verbal proficiency. Based on their post, tax lawyers might have to invest more hours into their work. Moreover, clients could also ask them to travel on their account.
Cases Managed By A Tax Lawyer
As we have established by now, tax lawyers deal with taz related situations. Following are the cases managed by tax lawyers:
- Purchasing or Selling a Business: Tax lawyers provide assistance and guidance to business owners regarding situations such as increase and/or decrease in income to reduce their tax obligations.
- Possessing a Business Abroad: Tax lawyers can guide individuals you own a business abroad. They see to it that they provide information and assistance regarding any compensations or tax outcomes.
- Allotting Money or Real Estate to Heirs: This is quite a complex portion of tax law. However, if you have an attorney, it will help you deal with any tax related issues you may have.
- Opening a Business: Tax lawyers also help those who are planning to start a business. They assist individuals to decide the kind of business they should operate, whether it should be Limited Liability Corporation (LLC), S-Corp and/or C-Corp. Moreover, tax lawyers also help their clientele to figure out their possible tax outcomes.
- Audit by the IRS: The purpose of a tax lawyer is to help clients prepare for a verification. It does not necessarily mean that you have done something wrong; sometimes the IRS just needs to take a closer look at your taxes and dealings. Tax lawyers will help you go through the entire process of meeting with IRS officials and even speak for you in a tax court.
How Much Does A Tax Lawyer Cost?
If you want to hire a tax lawyer, then you should know how much it would cost you. Is it even in your budget or not? If you are wondering about this question, then do not worry anymore. Given below are the average amounts that a tax lawyer may charge. Note that these prices are not the same everywhere. They may change according to the region you are in, the complexity of your case, and the experience of your lawyer. Now, let us have a look.
- Installment Agreement: $750 – $1,500
- Penalty Abatement: $1,000 – $2,500
- Simple IRS Audit: $2,000 – $3,500
- Offer in Compromise: $3,500 – $6,500
- Complex IRS Audit: $5,000 +
- IRS Appeals: $5,000 – $7,500
- US Tax Court Litigation: $10,000 +
Types Of Tax Attorney Fees
After figuring out the cost of hiring a tax lawyer, you should also know about the types of tax attorney fees. Typically, there are two types of tax lawyer fees. Let us look at the two and see which one is better.
- Hourly Rate: Most of the tax lawyers charge an hourly rate. These rates can vary due to different factors. However, the average hourly rates lie between $200 to $400. If your lawyer has a lot of knowledge and experience and usually works with giant business conglomerates, then he/she may even charge almost up to $1000.
- Flat Fees: A flat fee is charged when the cases are not complex. It is a one time amount that you pay despite the number of hours the lawyer works with you.
Now the question arises as to which type is the better option? You must remember that each of these choices have their pros and cons. If you opt for an hourly rate, you do not have to pay extra charges to the attorney if your case is handled quickly or there is not much work done.
However, you may have to pay a lot of extra legal fees to the lawyer if the case takes up a lot of time. Thus, most clients prefer to pay a flat fee so that a specific amount is agreed upon.
Still, despite the choices you opt for, most lawyers ask for an hourly fee. It is still worth a shot to ask for a flat fee. However, you must be warned that the lawyer may not agree to it. Afterall, they would want to be paid more if by any chance they are required to do extra work on your case.
How Can You Save Some Money?
If having a tax lawyer is out of your budget, then you do have an alternative where you can manage your tax concerns yourself. Despite sounding a little pressuring, you still have a lot of options available that will aid you in managing your tax dilemmas yourself.
You can take a look at various Self Help Courses if you want to manage your tax problems. These online courses will help you be well prepared for any case you want to manage. The courses give you a detail of all the steps you need to know to ace your case.
Do you really need a tax lawyer?
Tax situations and dealing can be pretty tricky and complex. So, you might end up thinking about whether you even need a tax attorney or not. There are a few cases where it may be essential for you to hire a tax lawyer as it would only help you with the case. The following are the cases where it is advised that you hire a tax lawyer.
- You are opening a new business.
- You’re purchasing or selling a business.
- You’ve been blamed for doing something wrong and illegal with your taxes.
- You owe back taxes.
- You want to allot money or real estate to your heirs.
Now that you have read the entire article, you know about how much a tax lawyer costs. You can now get a tax lawyer for yourself depending on how much your budget is.