First and most importantly before we lay out the basics of making a wise choice-one that will hopefully develop into a long term professional relationship; it is important to decide why you want a tax attorney. Truly, the myth of the safety net that tax attorneys provide is just that a myth.  Having said that, there are many valid and important reasons to use and be affiliated with a tax attorney.

Second, before we pick a tax attorney, take an internal audit and make sure that your not bring a tax attorney on board solely to have bragging rights of having a tax attorney, or that you have the extra cash to do so, but know that a tax attorney is not always a substitute for an accountant; sometime yes-most of the time both are necessary and many tax attorneys will have in-house bookkeepers and accountants to assist him.

Now, you’ve decided that you are going to hire a tax attorney. For fear of stating the obvious, check to make sure the person actually went to law school, sat before the bar and passed the exam and is a licensed attorney specializing in tax law. I cannot emphasize this enough. Somewhere in the fine print, you may see “Specialist” on their card or shingle outside the door and after hearing about their law experience, assumptions can be made, but you will be the one to take on the risks, not the “legal expert”.

Next, when choosing a tax attorney, once you have verified their licensure and status with the bar, remember, even though your tax attorney signs off on your IRS forms as having prepared your federal forms, you are still legally liable for all and any discrepancies that you’ve filed.   Discuss these expectations and exactly how these worst case scenarios will be handled, should such an unfortunate event occur.

Also, when interviewing possible tax attorneys, find out how services and time will be charged. Typically, the billing starts, literally, the moment your attorney says “Hello” when on the phone or in person (although in person visits will usually tack on driving time and preparation time if your attorney is meeting you at your specified location) You will also be charged for all postage, copies, secretarial time, etc. Any activity you can imagine, you will be billed for. The person you are interviewing will appreciate your asking for everything in writing, so make sure you leave with plenty of reading material.

Also, ask what the fees will be should there be a discrepancy from the IRS once taxes are filed. Your tax attorney will of course be there to handle all communications with the IRS on your behalf, but there could very likely be a different rate for these services, best to check before hand and not when you find yourself responding to the IRS after they’ve found a discrepancy and you need the help of your tax attorney.

All in all, weigh your decision to pick a tax attorney on what the tax attorney is bringing to you and/or your financial portfolio and the amount of risk you believe you are hedging against. Will there be a measurable benefit beyond simply using an accountant.  The Bottom line is that the larger and more varied your portfolio, the more the likelihood that a tax attorney will be able to help maintain your portfolio at filing time.