7 Frequently Asked Questions About Tax Lawyers: What to Know

Frequently Asked Questions (FAQs) About Tax Attorneys 

While many Taxpayers (thankfully) may never need the assistance of a tax attorney, oftentimes when a more complicated tax situation arises, such as business taxes, international taxes, employment taxes, etc.– the Taxpayer may need the assistance of a tax attorney for a specific project or as ongoing counsel. In fact, there are many different types of tax attorneys depending on whether you need a tax attorney for a single event or an ongoing situation, and whether or not you require a litigator or transactional attorney. Unfortunately, there is some bad information online about hiring a tax attorney (‘self-proclaimed tax experts’ for example), what kind of confidentiality/protections are afforded by the attorney, and what to do when you just do not like your attorney anymore and you want to move onto the next one. Let’s look at seven important frequently asked questions about hiring a tax attorney.

Becoming Licensed as an Attorney

Tax attorneys are generally licensed by at least one state within the United States. When an attorney handles federal tax law such as an Internal Revenue Service matter, they do not need to be licensed in any particular state in order to practice federal tax law. In other words, if the attorney is licensed in at least one state, then they will qualify as an attorney and are able to practice federal law.

State Tax Lawyer vs Federal Tax Lawyer

If a person is going to practice state tax law, then typically they are going to be licensed in that particular state, but that is not always required — it depends on the type of matter. For example, if a person is going to litigate a case in California state court or New York State court then generally the attorney is going to be licensed in that state. If the attorney is instead going to litigate the case in federal court in that state, then they may be able to waive into that state for the particular matter (Pro hac vice).

Types of Tax lawyers

There are many different types of tax lawyers. What type of tax lawyer you need is based on what type of tax matter you have. Typically, if you have a more complicated tax matter then you will want to use a Board-Certified Tax Law Specialist to assist you with your matter (such as with offshore disclosure matters). But, even within the realm of being board-certified, most firms have one type of specialty focus. For example, our tax law firm focuses specifically on international tax law. Other firms may focus specifically on litigation or employment tax law or sales tax law, etc. — but due to the overall complicated tax laws in general, most firms specialize in one area of tax.

Attorney-Client Privilege and Confidentiality

There are many different facets to confidentiality and different states have different laws as to what applies for confidentiality purposes. For the most part, if the matter is involving a legal issue, then the taxpayer and the attorney enjoy an attorney-client privilege and confidentiality of those matters. It is important to note, that it is the client and not the attorney who controls the privilege. In other words, if the client decides that they want to discuss matters with other persons, which may result in breaking the privilege, then it is the client’s right to do so.

Breaking up is (Not) Hard to Do

This one is very confusing for taxpayers due to all the misinformation that is out there, but it is important that taxpayers always remember that they control the relationship. In other words, if a client wants to fire an attorney and/or terminate the relationship, they have the right to do so. The attorney cannot force the relationship. This tends to lead to issues involving fees that may have been paid and fees that may be due, but that is something that can be hashed out between the attorney and the client. If not, it will usually end up in arbitration or mediation.

Is a Tax Partner or Associate Handling Your Case?

When you hire a tax attorney, it is important to determine what type of attorney at that firm will be representing you. There are two types of attorneys — there are partners and then there are the associates. There are also support staff such as paralegals and office managers, but when it comes to legal representation for your tax matter, you are working with a partner or you are working with one of the associates. Some associates may have additional duties such as handling more of the administrative or managerial tasks and they may have different titles, but at the end of the day either you are working with a partner, or an associate — and the associates tend to have less experience than the partners – and have a lower hourly fee.

Flat-Fee vs Hourly

There are typically two types of arrangements for tax law matter fees, which are either flat-fee or hourly. Depending on the type of matter you have, will impact whether the firm charges hourly or flat fee. For example, in the area of tax that we specialize in — offshore disclosure and compliance — we utilize a flat fee model. If you are in a litigation case, the firm may be utilizing an hourly-fee model because it would be difficult if not impossible to determine how long it will take the attorneys to complete the matter.

Need Help Finding an Experienced Offshore Tax Attorney?

When it comes to hiring an experienced international tax attorney to represent you for unreported foreign and offshore account reporting, it can become overwhelming for taxpayers trying to trek through all the false information and nonsense they will find in their online research. There are only a handful of attorneys worldwide who are Board-Certified Tax Specialists and who specialize exclusively in offshore disclosure and international tax amnesty reporting. 

Important Links:

• • • How to Find an Experienced International Tax Lawyer

    • Flat-Fee vs Hourly Fees

    • Avoid Hourly Attorneys Who Pad Their Fees (Case Study Example)

Golding & Golding: About Our International Tax Law Firm

Golding & Golding specializes exclusively in international tax, and specifically IRS offshore disclosure. 

Contact our firm today for assistance.