Tax Attorney: What Tax Lawyers Do, When to Hire One

A tax attorney is a lawyer who specializes in tax law. They help people arrange their finances to optimize their tax situations, comply with tax rules and handle disputes with the IRS or other tax authorities. Some specialize in areas such as estate taxes, business taxes, international taxes or tax debt.

Tax attorneys often practice at law firms or accounting firms. Some may be solo practitioners, meaning they own their businesses and work for themselves.

Tax lawyers at law firms tend to advise clients about how to get favorable tax treatment in various situations. They may draft contracts or other legal documents needed to make it happen, and they may represent clients in tax court or elsewhere. Tax lawyers at accounting and consulting firms tend to help clients with tax rule compliance.

Not sure if need to hire a tax attorney or another pro? Here are some situations that may be especially suited for hiring a tax attorney.

Estate planning: A tax attorney can help you devise estate planning strategies and handle the paperwork involved in minimizing estate taxes, transferring assets to family members, setting up trusts and other tactics.

Starting a business: A tax attorney may be able to help devise tax-smart strategies for starting, buying, selling or expanding a business.

Tax debt relief: If you have an outstanding balance with the IRS or other tax authority that you want to negotiate or contest, a tax attorney may be able to help you pursue options such as:

• Offer in Compromise.

• Innocent spouse relief.

• Installment plans to pay tax bills over time.

Tax disputes: If you're being audited, have a tax dispute, want to sue the IRS, the state, or a local tax authority over a tax matter, or if you want a hearing before the U.S. Tax Court, a tax attorney can help.

» MORE: 5 ways to deal with tax debt

Here are three things to check for:

1. A law license. An attorney must have a law license to practice law. You can verify whether a tax attorney has a license to practice law in your state by searching your state’s bar association website.

2. Signs of advanced education or specialization. In most states, you must also graduate from law school in order to get a law license. Some tax attorneys have a master’s degree in taxation (called an LL.M.). Some tax attorneys also have CPA licenses, which means they are also certified public accountants.

3. A preparer tax identification number (PTIN). Anybody who prepares tax returns in exchange for compensation must have a preparer tax identification number from the IRS. The preparer must sign your tax return and provide a PTIN.

» MORE: How to vet or find a CPA near you

In general, legal work can be costly. Depending on their fee structure or the services they provide, tax attorneys may charge either a flat fee or an hourly rate.

According to the 2023 Clio Legal Trends Report, tax law firms charge an average hourly rate of $369, while individual tax attorneys charge an average of $409 per hour^[0]

You might be able to get free or low-cost help from a tax attorney by visiting a low-income tax clinic, known as an LITC, in your area. These clinics represent people with income below certain levels and who need to resolve tax problems with the IRS. LITCs can represent you in audits, appeals and tax collection disputes before the IRS and in court. LITCs can also help people respond to IRS notices or fix account problems. You can locate a local clinic on the Taxpayer Advocate Service website.