The success of any business depends upon cooperation with the federal laws. Even multinational companies face hefty charges when they fail to comply with laws and regulations. Small businesses need to keep a watchful eye on many issues. Taxation isn’t just one of them; it’s probably the essential matter. That’s why business people go for tax attorneys to handle their taxes. These professionals make sure there’s no room for error to be caught and exploited by the government.
Who do you hire to handle your taxes?
Everyday people have only a few means of income. They don’t need any outside help to handle their taxes. But the revenue generated by a business creates a complicated situation when it comes to taxation. Your income might come from interest and dividends. Your foreign assets could earn you some modest capital gains. Misreporting overseas investments can also lead to short sales or foreclosures. How do tax attorneys help you out? Well, let’s find out how many types of tax advisors there are.
- Enrolled agent:
How about getting help from the inside to deal with the IRS? Enrolled agents (EAs) are tax professionals small businesses can hire economically. They provide accounting assistance based on their experience with the IRS. The Treasury Department empowers these advisors after they’ve passed the examination to become an EA. There are more than 50,000 enrolled agents in the country right now.
- Tax lawyers:
You can use a degree obtained with online LLM in tax education to become a certified tax attorney. These lawyers help you settle back taxes and negotiate with the IRS on your behalf. With a strong command over tax laws, tax attorneys can interpret these laws. If the IRS targets you with a criminal investigation, you must hire these lawyers. If you receive an audit notification, seek refuge in these professionals.
- Public accountants:
A certified public accountant in the United States is what the British call a chartered account. almost all states allow CPAs to practice in other countries. A person has to pass the CPA examination to become a certified auditor. This advisor will help small or multinational businesses/organizations to manage their finances. You can trust the certified public accountants to write audited financial statements.
Why should you hire a tax lawyer?
- They save you precious time:-
The Code and Treasury Regulations issued by the IRS are capacious. You don’t have time to study and interpret the 1700-pages long Federal Income Tax rulebook. Your taw lawyer can save you the trouble to go through all this legal fine print. It takes a typical taxpayer half a day to prepare his/her tax return. For business people, it takes nearly 20 hours! That’s why business owners hire tax attorneys so you can focus solely on commercial matters.
- You can’t keep up with evolving law:-
The law is ever-changing; you can’t keep up with these frequent modifications. But the IRS doesn’t accept the I-didn’t-know excuse. That’s why you have to hire tax attorneys to act as your insurance against ignorance. These attorneys are well-versed in their profession, and it’s a part of their job to keep their education updated. The constantly-evolving tax law affects everyone, even if you own a small business. Hence, tax attorneys give you peace of mind.
- They handle business contracts taxation:-
What are the tax implications of commercial contracts? Tax attorneys review your business contracts and make sure they don’t lead to further taxes. It is especially crucial if you’re trying to renew an agreement. Tax advisors will help you escape any unwanted burden of extra taxation. When you plan to buy/sell a business, they come to the rescue too.
- You might want quality for tax deductions:-
Nobody likes paying too much taxes! How about a little concession from the government? Tax lawyers can look for some valuable deductions you can get. Certain items might be tax-deductible if you’re a businessman. Tax attorneys also know how the location of your company affects taxation. They know the difference between state and local taxes. Then being either an employer or an independent contractor makes a difference too. You can minus the expenses of equipment purchase, employee benefits, and official travel from your taxes. These tax advisors also ascertain you don’t claim deductions you don’t qualify for, such as personal expenses.
- They help you out with the IRS:-
It’s okay if the IRS wants to know more about your declared assets and documented tax returns. But if you disagree with the auditor’s decision, you can hire a tax attorney to represent you. The lawyer shall deal with the IRS on your half and work towards a settlement. It will help if you have an efficient guy because the IRS doesn’t readily offer a compromise. Is the IRS targeting you with criminal charges? Even if you’ve been careless about your tax returns, you can still get help from a tax advisor. If the IRS is sending you CP notices, you can count on a tax lawyer to tell you what it means. For instance, CP2000 means your tax returns don’t match the reports received by the IRS.
Experts estimate that small businesses owned by a single person pay a 13.3% tax rate on average. This average increases to 23.6% when the business involves multiple owners. Small business corporations have to pay a 27% tax rate. Fortunately, only 25% of small companies are corporations. Overlooking your taxes brings severe consequences for the future of a company. Tax lawyers help you escape the wrath of the IRS efficiently without hassle.