Tax Professionals - Tax Attorney Verses CPA Versus Enrolled Agent

Tax relief professionals come in three types: (1) tax attorneys, (2) CPAs, and (3) Enrolled Agents. Each of these three categories of professionals are authorized to represent you before the Internal Revenue Service. Each type of professional has its advantages and disadvantages, and you should be aware of the differences as you research your options with respect to your tax problem.

Tax attorneys are like any other attorney and therefore are licensed in at least one state to practice law. This has many advantages. For instance, every attorney is subject to the state bar disciplinary and ethics counsel, which generally expect attorneys to have only the highest degree of integrity and ethical behavior in their legal practices. The advantage to you, as the client, is that the attorney must comport him or herself with professionalism and attention to legal issues. If the attorney fails to deal with you ethically, you can report the attorney to the state bar association.

CPAs are likewise licensed to practice in a state and are subject to disciplinary action if they violate certain ethical rules. Accordingly, a CPA must comport him or herself ethically at all times in his or her dealings with you. Again, like the advantages of using an attorney, it's nice to have leverage with a CPA who has an incentive to work ethically in order to avoid any reports of ethical lapses to the state ethics board.

Enrolled agents have the least amount of direct ethical supervision. Of course, they are subject to the rules imposed by the IRS, but there is no third-party ethical board (other than the IRS itself, of course). Enrolled agents are tax practitioners who have either worked at the IRS for a certain period of time or passed an exam that tests tax-related subjects.

When it comes to cost, enrolled agents generally win. Attorneys are notoriously expensive, and CPAs are somewhere in the middle. Of course, these are generalizations and you should request and compare quotes from more than one tax professional.

Before choosing any tax relief professional, closely monitor who they are, how much experience they have working on matters similar to yours, and how much it will cost. Remember that you are in the driver's seat in these conversations since you are the client and the professional is the service provider. Don't be afraid to ask for any information you need in order to make a fully informed decision.