Had it not been for her tax lawyer, Sasha Jones, an operations manager of a travel agency, would have paid a total of $45,000 to the federal government after being found responsible for a Trust Fund Recovery Penalty.
The attorney prepared Sasha right before the interview with a revenue officer when she was included in a list of potentially responsible persons. The lawyer also guided her on the protest letter she wrote to the appeals office, which ultimately reversed the responsible person finding of the Internal Revenue Service.
One can always opt to deal with IRS issues alone, but professional assistance from someone who is an expert in taxes can make it even easier to navigate the process.
Of course, there are pros and cons to working on your own or with a tax professional so you need to assess the advantages and disadvantages first.
Should I seek help from a tax professional?
|Save more time and be stress-free. If you hire an expert, you wouldn’t have to worry about going through every book or resource material to learn and study the issue at hand.||Costly professional charges. Someone’s expertise always comes at an expensive price, especially when they are competent.|
|Learn about the process. When you have someone who can teach you about the nitty-gritty of the tax code, you can brainstorm on the best strategies and courses of action to solve the problem.||Consultations still have fees. Professionals charge for consultations but you can save more if you instead hire them to represent you.|
|IRS holds good tax professionals in high esteem. Instead of having to face it on your own, you can have someone more knowledgeable and confident.||Risk of getting someone inexperienced. You wouldn’t want to waste your money on a service that will not deliver or help you get through the issue.|
There are three types of tax professionals:
- An enrolled agent (EA) is a tax adviser and preparer licensed to practice in the Internal Revenue Service. However, they are not capable of representing you in the tax court. If you want a cost-effective and less expensive way to deal with a tax issue, an EA is the way to go.
- Certified public accountants (CPA’s) are licensed and also regulated. They have a college degree, experience with CPA firms, and must pass a stringent test. Some may have experience with the IRS but a lot of them also never deal with the internal revenue service within the context of tax resolution.
- A tax attorney is a lawyer whose expertise is in estate planning and complicated tax matters. It is recommended to get a tax attorney with a special tax law degree. With their extensive knowledge on tax issues, they come at an expensive price so if a large amount of money is at risk, you might want to consider a tax attorney out of all the options.
- What is the Trust Fund Recovery Penalty? - August 25, 2022
- CDTFA Notice of Levy - August 8, 2022
- The Statute of Limitations on Deficiency Assessments - June 2, 2022
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