IRS Tax Settlement Attorneys: What They Do and When You Need One

IRS Tax Settlement Attorneys – When you owe taxes to the IRS or have other tax problems, you will be wondering if you need to hire a tax attorney to help you resolve your situation. A tax attorney is a legal professional who specializes in tax law and can represent you before the IRS or other tax authorities.

In this article, we will explain what a tax attorney can do for you when you should hire one, and how to choose the best one for your needs.

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What Can a Tax Attorney Do for You?

A tax attorney can help you with various tax issues, such as:

Negotiating an offer in compromise: An offer in compromise is a settlement agreement that allows you to pay less than the full amount of your tax debt. A tax attorney can help you determine if you qualify for an offer in compromise, prepare and submit your application, negotiate with the IRS on your behalf, and handle any appeals or challenges that may arise.
Requesting an installment agreement: An installment agreement is a payment plan that allows you to pay your tax debt over time. A tax attorney can help you request an installment agreement, review and modify the terms and conditions, ensure that you comply with the requirements, and deal with any issues or changes that may occur.
Applying for an innocent spouse relief: An innocent spouse relief is a relief from joint liability for taxes resulting from your spouse’s or former spouse’s actions. A tax attorney can help you apply for an innocent spouse relief, provide evidence and documentation to support your claim, communicate with the IRS on your behalf, and handle any appeals or challenges that may arise.
Filing an appeal: An appeal is a challenge to the IRS’s decision or action regarding your tax case. A tax attorney can help you file an appeal, prepare and present your arguments and evidence, negotiate with the IRS on your behalf, and represent you in any hearings or conferences that may take place.
Litigating a tax dispute: A tax dispute is a lawsuit against the IRS or other tax authorities in court. A tax attorney can help you litigate a tax dispute, prepare and file your complaint and motions, conduct discovery and depositions, argue your case before a judge or jury, and handle any post-trial matters.

A tax attorney can also help you with other tax matters, such as:

Advising you on tax planning and compliance: Tax planning and compliance is the process of arranging your finances and activities to optimize your tax situation and follow the tax rules. A tax attorney can help advise you on tax planning and compliance, such as choosing the best entity structure for your business, claiming deductions and credits, reporting income and expenses, filing returns and forms, and avoiding penalties and audits.
Assisting you with tax audits: A tax audit is an examination of your tax returns and records by the IRS or other tax authorities. A tax attorney can help assist you with tax audits, such as preparing and organizing your documents, responding to inquiries and requests, negotiating with the auditors on your behalf, and resolving any discrepancies or adjustments.
Protecting you from tax fraud or evasion charges: Tax fraud or evasion is a criminal offense involving intentional or willful underpayment or nonpayment of taxes. A tax attorney can help you protect yourself from tax fraud or evasion charges, such as advising you on your rights and obligations, representing you during investigations and interviews, negotiating with the prosecutors on your behalf, and defending you in court.
Defending you from tax liens or levies: A tax lien or levy is a legal action by the IRS or other tax authorities to seize your property or income to satisfy your tax debt. A tax attorney can help you defend yourself from tax liens or levies, such as challenging the validity or amount of the lien or levy, requesting a release or withdrawal of the lien or levy, negotiating a payment plan or settlement with the IRS on your behalf, and representing you in any hearings or proceedings that may take place.

When Should You Hire a Tax Attorney?

However, hiring a tax attorney is not always necessary or beneficial for every tax problem. A tax attorney can be expensive and may not be able to offer you more than what other tax professionals, such as certified public accountants (CPAs) or enrolled agents (EAs), can do. You should consider hiring a tax attorney only if:

You owe a large amount of taxes that you cannot afford to pay or that would cause significant financial hardship

If you owe more than $10,000 in taxes that you cannot pay in full or that would jeopardize your ability to meet your basic living expenses, you may need a tax attorney to help you negotiate a settlement or a payment plan with the IRS or other tax authorities. A tax attorney can help you explore your options, such as an offer in compromise, an installment agreement, a currently not collectible status, or a bankruptcy discharge. A tax attorney can also help you avoid or reduce penalties, interest, or collection actions, such as liens or levies, that may result from your tax debt.

You are facing serious penalties, interest, or collection actions from the IRS or other tax authorities

If you are facing severe consequences from the IRS or other tax authorities for failing to pay or file your taxes, such as civil or criminal penalties, interest charges, liens, levies, garnishments, or seizures, you may need a tax attorney to help you protect your rights and assets. A tax attorney can help you challenge the validity or amount of the penalties, interest, or collection actions, request a waiver or abatement of the penalties or interest, negotiate a compromise or a release of the collection actions, or appeal the IRS’s decision or action regarding your case.

You are involved in a complex or contentious tax dispute that requires legal expertise or representation

If you are involved in a complicated or disputed tax matter that involves legal issues or arguments, such as an audit, an appeal, litigation, a fraud or evasion charge, an innocent spouse relief claim, or a whistleblower case, you may need a tax attorney to help you resolve your situation. A tax attorney can help you prepare and present your case, communicate and negotiate with the IRS or other tax authorities on your behalf, and represent you in any hearings, conferences, or court proceedings that may take place.

You have a unique or special tax situation that requires specialized knowledge or advice

If you have a rare or specific tax situation that involves uncommon or complex tax rules or regulations, such as international taxation, estate, and gift taxation, nonprofit taxation, or cryptocurrency taxation, you may need a tax attorney to help you understand and comply with the tax laws and requirements. A tax attorney can help you advise you on the best tax strategies and solutions for your situation, such as choosing the optimal tax jurisdiction, entity structure, or reporting method, claiming the appropriate tax benefits, or avoiding potential tax pitfalls.

How to Choose the Best Tax Attorney for Your Needs?

If you decide to hire a tax attorney, you should do some research and comparison before choosing one. You should look for a reputable and experienced tax attorney who has:

A license to practice law in your state

A license to practice law in your state is proof of the tax attorney’s education, training, and qualification to provide legal services in your jurisdiction. You can verify the license status and disciplinary history of the tax attorney by contacting the state bar association or the state court system.

A degree in law and preferably a master’s degree in taxation

A degree in law and preferably a master’s degree in taxation is proof of the tax attorney’s knowledge and expertise in tax law and related fields. You can check the credentials and academic background of the tax attorney by reviewing their resume, website, or online profile.

Membership in the American Bar Association (ABA) and its Section of Taxation

Membership in the American Bar Association (ABA) and its Section of Taxation is proof of the tax attorney’s professionalism and involvement in the legal community. The ABA is the largest and most prestigious national organization of lawyers and law students. The ABA Section of Taxation is the leading professional association of tax lawyers and provides various resources and benefits for its members, such as publications, events, networking opportunities, and continuing education programs. You can verify the membership status and activities of the tax attorney by contacting the ABA or visiting its website.

A good rating from the Better Business Bureau (BBB) and other consumer review sites

A good rating from the Better Business Bureau (BBB) and other consumer review sites is proof of the tax attorney’s reputation and customer satisfaction. The BBB is a nonprofit organization that evaluates and accredits businesses based on their performance, reliability, and integrity. Other consumer reviews sites, such as Yelp, Google Reviews, or Trustpilot, allow customers to rate and review businesses based on their experience and feedback. You can check the rating and reviews of the tax attorney by visiting the BBB website or other review sites.

A track record of successful cases and satisfied clients

A track record of successful cases and satisfied clients is proof of the tax attorney’s competence and effectiveness in handling various tax issues and situations. You can check the track record of the tax attorney by asking for references, testimonials, case studies, or results from their previous or current clients. You can also ask for examples of similar cases.

In conclusion, If you decide to hire a tax attorney, you should do some research and comparison before choosing one. You should look for a reputable and experienced tax attorney who has a license to practice law in your state, a degree in law and taxation, membership in the ABA Section of Taxation, a good rating from the BBB and other review sites, and a track record of successful cases and satisfied clients. You should also ask for references, testimonials, fees, and contracts from the tax attorneys you are considering. You should compare their services, prices, and terms and choose the one that best suits your needs and budget.

Frequently Asked Questions (F&Qs)

What are the different types of IRS tax settlements?

There are two main types of IRS tax settlement:

Offer in compromise: This is a settlement agreement where you agree to pay a reduced amount of tax in exchange for the IRS releasing the rest of your debt.
Installment agreement: This is an agreement where you agree to pay your tax debt in installments over time.

What are the risks of hiring an IRS tax settlement attorney?

Cost: The fees of an IRS tax settlement attorney can be expensive.
Unethical practices: Some IRS tax settlement attorneys engage in unethical practices, such as promising unrealistic results or charging excessive fees.
Not qualified: Some IRS tax settlement attorneys are not qualified to represent you in your dealings with the IRS.

Who is an IRS tax settlement attorney?

An IRS tax settlement attorney is a lawyer who specializes in helping people resolve their tax problems with the IRS. They can help you negotiate a payment plan, get an offer in compromise, or represent you in an audit or appeal.

IRS Tax Settlement Attorneys