How a Tax Lawyer Can Help You

The income tax system in the United States was set up by the Congress in 1913. It remains in effect even today despite various revisions. It includes an individual income tax, applying to natural persons and trusts, and a corporation income tax. The individual tax is a global tax assessed against taxable income from all sources; however, long-term capital gains have been subject to special treatment since the Revenue Act of 1921 and earned income has been taxed at preferential rates at various times. Under existing tax law, corporations are taxes usually taxed as separate entities while shareholders pay individual income tax on the dividends they receive. Unincorporated businesses are generally not taxed. Instead the owners of such businesses pay individual income tax on the profits. They must pay tax on the profit even if they do not withdraw the profit from the business.



Tax law deals with the legal requirements for paying taxes to the federal government and state governments. Tax law is complicated. Federal law governs federal taxes while state law governs state taxes. Social Security taxes, Medicare taxes, income taxes, gift taxes are some of the taxes collected by the federal government. State income taxes and state sales taxes are the two most common state taxes. Attorneys who deal in tax laws are called taxation attorneys or tax attorneys. A tax law firm interprets and advises on issues of tax law. With so many taxes to keep track of, including payroll tax, employment tax, income tax and state sales tax, it’s easy to make a mistake. You can avoid such errors by hiring the services of a tax law firm.



A tax lawyer can help you avoid known traps or to get you out of ones that you may have fallen into. A tax lawyer can also help avoid tax vagaries and other levies. Since a tax lawyer is familiar with the processes involved, he may be able to procure a reduction in tax money owed or to eliminate it altogether. Often tax law firms work alongside accountants to assist their clients solve their tax problems, or carry out tax planning in the best possible manner. Tax attorneys have the knowledge required for interpreting tax laws be it based on statute law, case law or international tax treaties. A tax attorney can assist you by negotiating with the Internal Revenue Service (IRS) if you owe back taxes. Tax laws are always changing and tax attorney generally keep themselves abreast of the changes. You will require a tax attorney if:

• The IRS is taking serious action against you including audits, fines and liens.

• You have a taxable estate, need to make complex estate planning strategies, or need to file an estate tax return.

• You are starting a business and need legal counsel about the structure and tax treatment of your company.

• You are engaging in international business and need help with contracts, tax treatment, and other legal matters.

• You plan to bring a suit against the IRS.

• You plan to seek independent review of your case before the US Tax Court.

• You are facing tax fraud charges (such as claiming false deductions and credits) and are seeking the protection of privilege.



Tax lawyers do not have any special qualifications. Just like every other lawyer, a tax lawyer must have a JD degree from an American Bar Association accredited law school and must have cleared the state bar exam. A tax attorney must pass the state bar exam before he can practice in the state.