We work hard to prepare our taxes properly. We collect all our records, do our research, plan ahead, and many of us hire a professional tax preparer. All that effort is not good enough sometimes as any number of situations can result in an IRS or state action to dispute our results and try to collect additional taxes. Most audits are routine and can often be handled by mail or with minimal assistance. But in some cases, a tax situation is well over the head of both the taxpayer and the tax preparer. In times like this it may be in your best interest to hire a qualified tax attorney.

The tax code is so long and complicated that nobody really understands it all. Some situations are ambiguous or can be interpreted in different ways. Sometimes a taxpayer makes an honest mistake or omission or a major life change can affect a person’s tax situation unknowingly. The result is often a large increase in taxes due and possibly a tax penalty. When the dispute cannot be resolved by ordinary effort, legal help will be your best option.

Not just any attorney is qualified to represent clients in tax cases. Specific training and updates in tax law are required, and a CPA or Enrolled Agent designation is highly desirable. The tax attorney needs to know the current, ever-changing tax code and how the IRS operates internally in order to prevent IRS abuse and allow their clients to defend themselves properly.

Even average taxpayers with no fraudulent intent need an attorney when their tax troubles keep them up at night with worry. Common situations include:

• Years of unfilled returns
• Under-reporting of income, prizes or settlements
• Taxable windfalls
• Overdue back taxes
• Unmanageable interest and penalties
• Wage levies and garnishments
• Payroll taxes
• Foreign bank accounts
• Taxes from an ex-spouse
• plus many more

If any of the above applies to you a tax attorney can help you navigate through the tax bureaucracy. Tax attorneys can arrange for relief such as stopping levies, waiving penalties and interest, collecting needed records or arranging payment plans. They speak the language of the authorities and speak up for clients facing the power of the government. In the most serious cases where the taxpayer cannot pay what is owed, an Offer in Compromise may be considered. An Offer in Compromise settles the overall tax bill for a small percentage of the total. These are difficult to obtain and are based on a thorough evaluation of the taxpayer’s ability to pay. When applying for an Offer in Compromise you will need a seasoned tax attorney to represent you.

For more advanced cases, clients accused of civil or criminal tax fraud will need a defense attorney well versed in tax law.

At times, even tax preparers will need an attorney. Tax preparers are held accountable to a higher ethical standard and are subject to penalties and sanctions for not following the rules. In the case of an investigation, an attorney will be needed to protect the preparers career and reputation.

Unfortunately, the field of tax law has its share of scam artists. Legitimate tax attorneys are as angry about this abuse as everyone else and encourage clients to shop carefully for an attorney. Despite the stress of each client’s situation, it is essential for them to take the time and do the research to find an attorney with the knowledge and ethics to handle each case effectively. The result to aim for is always a fair settlement and final peace of mind.