It depends. CPAs are licensed to give qualified opinions about the accuracy of financial statements. An enrolled agent is someone, other than an attorney or CPA, who may practice before the IRS, but is not an actual member of the IRS. Please note that these designations do not always confirm any formal knowledge of tax law or of IRS internal audit procedure.
However, a tax attorney representing you has many advantages in that we have the formal legal training to interpret the ramifications of tax court cases and advice on other related legal issues. Additionally, we are well versed in the IRS audit procedure in conducting the audit along with fighting the audit determinations should the taxpayer disagree. A tax attorney will act as the mediator between you and the IRS. The benefit for hiring a tax attorney is that we are extremely experienced in working with IRS audits. For instance, our firm handles IRS audits on a daily basis. We have a great working relationship with a majority of the local San Diego and San Marcos auditors. Due to our frequent dealings with the IRS auditors and their managers, we are very experienced in presenting an audit to make easy for both the taxpayer and the auditor to get through the audit. Due to our diligence, professional relationship with the auditor and our presentation of the audit documents in IRS audits, we have been able to achieve high level of results for our clients.
Additionally, should your audit escalate to a high level, only a qualified tax attorney can represent you before the Tax Court and it is highly recommended that a qualified tax attorney assist in case your audit has a taint of criminality or large adjustments. Furthermore, conversations between our firm and you are protected by the attorney-client privilege and cannot be used against you later in the audit or in the court.
In many scenarios, it is not advisable for you to have the same CPA/enrolled agent/tax attorney who arranged the tax return also represent you in the audit as there may be additional complications. An attorney’s natural inclination is to defend their work and not appear incompetent in front of his/her client. This creates a natural conflict of interest and may be very damaging during the audit. In cases of negligence or perceived fraud, the attorney will be very hesitant to accept responsibility for their own mistakes. Furthermore, some audits are conducted because the IRS has found a large amount of mistakes or suspects fraud based on its review of other returns the person or firm setup. Your attorney may suspect this based on interactions with their other clients, but may not disclose this to you until after the damage has been done.
Avoid a potentially serious and costly mistake. Rather than take your chances with unqualified or unfit representation, get an independent analysis by someone knowledgeable in tax law who can properly defend your rights in an audit.
If you have any questions or if we can further assist you, please contact our San Diego office.
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