A tax attorney and a Certified Public Accountant (CPA) are both professionals who specialize in tax-related matters, but they serve different roles and have distinct areas of expertise. Tax attorneys help individuals and businesses navigate the tax code and provide tax relief. A Certified Public Accountant is an accounting professional who has earned a license to practice. CPAs help with financial planning, reporting, and tax preparation. Let’s dive into tax attorneys vs. CPAs; the differences, similarities, and more.
Tax Attorney: What Do They Do?
Education & Licensing
A tax attorney is a lawyer who has completed law school, passed the bar exam, and often has additional specialized training in tax law, such as a Master of Laws (LL.M.) in Taxation. First an individual pursuing a tax attorney career must have a bachelor’s degree and complete law school. Then, the individual must build their tax specialist skills through extra degrees or programs. To become a tax attorney, the individual must pass their state’s bar exam to get their license. Tax attorneys can work in all types of positions, from private practice to government positions.
Tax Specialization
Let’s look at the specialization of a tax attorney vs. CPA. Tax attorneys specialize in the legal aspects of taxation. They provide legal advice on complex tax issues, represent clients in disputes with the IRS or state tax authorities, and handle tax litigation in court. Tax attorneys also provide tax help through tax planning and compliance. They are also involved in estate planning, tax structuring for businesses, and handling criminal tax cases.
Client Focus of Tax Attorneys
??Tax attorneys often work with clients, individuals or businesses, facing legal challenges or disputes related to taxes, such as audits, appeals, or tax fraud allegations. They also help with legal strategies for minimizing taxes and ensuring compliance with tax laws.
Certified Public Accountant: What Do They Do?
Education & Licensing
A CPA is an accounting professional who has passed the CPA exam and met the licensing requirements in their state, which typically include a specific amount of education and work experience. A CPA has earned their licensing through a combination of education, experience, and licensing. Before an individual can become a CPA, they must complete a program of study in accounting, obtain professional work experience, and pass the CPA exam. Not all accountants are CPAs, accountants who are licensed by their state’s Board of Accountancy are considered CPAs.
Tax Specialization
CPAs focus on the financial aspects of taxation and other financial services. Some CPAs specialize in fields such as personal financial planning, forensic accounting, or taxation. Focusing on preparing reports that reflect the business dealings of individuals and companies, CPAs prepare tax returns, provide tax planning advice, and perform audits of financial statements. CPAs also offer broader financial services, such as bookkeeping, financial reporting, and business consulting.
Client Focus of CPAs
Let’s dive into the different client focuses of a tax attorney vs. CPA. Certified Public Accountants work with individuals, businesses, and organizations to ensure accurate financial records, review financial documents, prepare taxes, perform audits, prepare financial statements and optimize financial operations. They help clients with tax compliance and financial planning but do not typically handle legal disputes or tax litigation.
Tax Attorney vs. CPA: Key Differences
Legal Expertise
Tax attorneys have legal training and can represent clients in court, while CPAs focus on financial matters and accounting. Both positions have knowledge of tax laws and codes, but only tax attorneys can take tax related issues to court for a client.
Scope of Work
Tax attorneys handle legal disputes and complex legal tax issues, whereas CPAs handle tax preparation, accounting, and financial planning. Tax attorneys can also handle tax preparation and financial planning.
Client Needs
Clients who have legal tax issues, need representation in IRS disputes, want to plan their estate, want to start a business, or need tax debt relief should seek a tax attorney. Clients who need tax preparation, accounting, or financial planning services typically should work with a Certified Public Accountant.
Conclusion
In some cases, individuals or businesses may need both a tax attorney and a Certified Public Attorney to address different aspects of their tax and financial needs. A tax attorney and a Certified Public Accountant (CPA) are both tax professionals, but they have distinct roles. A tax attorney is a lawyer specializing in the legal aspects of taxation, including tax disputes, litigation, and legal strategies for minimizing taxes. They represent clients in court and handle complex legal issues. On the other hand, a CPA is an accounting professional who focuses on the financial aspects of taxation, such as preparing tax returns, providing tax planning advice, and ensuring accurate financial records. While tax attorneys are essential for legal tax matters, CPAs are crucial for tax preparation and financial planning. Depending on the situation, individuals or businesses may require the services of both professionals.
