#7 | The Value of a Tax Attorney

Practical Tax with Steve Moskowitz

In this episode of Practical Tax, tax attorneys Steve Moskowitz and Liz Prehn discuss the range of services tax attorneys can provide for their clients. Above all, the goal of the tax attorney – and this podcast, as well – as to make the client aware of different opportunities for saving taxes so they can achieve the best possible result. Listen to the podcast to learn more! Episode Transcript Speaker 1: 00:00 My brother has an accountant, and my boss has a tax attorney. I just started a small real estate company. I'm wondering which one will I need. Speaker 2: 00:07 You're listening to Practical Tax, with tax attorney Steve Moskowitz. Steve Moskowitz: 00:10 There was a time when most people thought that all was needed for the taxes was an accountant. That's how I started my career out. I was a CPA before I was a tax attorney. But then things changed, and the IRS got more aggressive. They started summonsing accountants and say, "What did your client tell you? Hand over the papers. What did you tell him?" Steve Moskowitz: 00:32 With an attorney, we have attorney-client privilege, and also there is a difference. That's why, when I became a tax attorney, I was already a CPA, but I wanted to be able to do more for the client. Like, be able to go into tax court for him or her, and everything else. To me, having achieved both licenses, there's a big difference between a tax attorney and an accountant. Steve Moskowitz: 00:52 For me, my personal experience was I had a certain range of service as a CPA. When I became a tax attorney, that so broadened. There was so much more I could do for a client. That's the reason I went to law school to become a tax attorney and be able to do so much more for my client, completely. Steve Moskowitz: 01:10 Over 20 years ago, I met my colleague Liz Prehn, a tax attorney. Liz, what are your thoughts on this area? Liz Prehn: 01:18 I think it's really an interesting question. I see the value in both the CPA and the tax attorney. I think, for our clients, it provides a really interesting tension that provides a great result for our client. CPAs have one set of rules. Generally very conservative. The tax attorneys have maybe a little more persuasive and may be pushing some boundaries, or coming up with some ideas that perhaps the CPA doesn't take into account. Liz Prehn: 01:46 It really provides a great result for our clients. As for the attorney-client privilege, I think we all know tax preparation is tax preparation, but in a lot of our criminal cases, we certainly have an extension to a CPA to help us interpret the case. That can only be done through an attorney. Steve Moskowitz: 02:04 So what happens is that sometimes we'll bring in people. Suppose, for example, someone speaks another language. The translator isn't an attorney. What happens is a provision where anybody the attorney hires to work under him or her has that privilege. So when I'm speaking to that client in the other language, and the client's telling me all his secrets, the IRS can't go to the interpreter and say, "Aha, Mr. Interpreter, you're not an attorney. What did the client say?" Steve Moskowitz: 02:25 No, he's under the privilege of the umbrella. That's one of the ways you get around that. That's why, for example, if an accountant is going to be employed, the client doesn't employ the accountant, the attorney employs the accountant. So you have the attorney-client privilege. Liz Prehn: 02:40 Interesting that the change... how cannabis has evolved. Back in the day, the CPAs and the accountants used to have a real problem with their clients because they didn't want to know certain things or certain business activities, but they had to be able to comply with their taxes. At least a lot of people did. A lot of people didn't, just bypassed the whole tax system. A lot of people were in the business of it and wanted to be able to buy houses and things like that.