Tax Planning

Tax Planning

Every action that people make has a tax consequence. 

  • Sell a business? The transaction needs a price evaluation for each asset and liability; further, there are choices that need to be made between an asset purchase and a stock purchase that can have significant tax reductions depending on your business structure. 
  • Have a baby? There can be issue with the child tax credit, child care credit, earned income credit, nanny tax payroll…. 
  • Purchase an investment property? There can be issues at sale including like kind exchanges, capital gains, depreciation recapture and resulting ordinary income. 

While tax consequences can be found in all activities of life, there are places for significant tax savings depending on how you structure your business and personal transactions. To help illustrate the potential tax savings, let’s take a closer look at the data.

Do I need a Tax Lawyer?

Not properly filing your tax returns or schedules correctly can result in a readjustment by the IRS or state taxing authority, or audit. This can result in frustration and heartache for you, your family, and your business. Where you have questions regarding any monetary transaction (e.g. a hobby, a business startup, a family gift or loan, a sale, or income from whatever source derived), a tax attorney can help guide you through the tax consequences and potential alternatives for tax savings. 

If you have questions regarding a transaction or tax consequence, you are probably wondering if you need to speak to a lawyer. Isn’t it better to speak to an accountant? It is always a good idea to speak to a tax attorney when you have questions—especially if they are complex, cover many years, or you are concerned the IRS may come after you. Our tax attorneys (who are also accountants) can give you a fair evaluation of your case, potentially undue incorrect tax plans, amend tax returns, and protect you from the IRS and state taxing authorities. A tax attorney can also give you guidance on whether you need the help of a lawyer based upon the particular set of facts of your case.

Why you need a Tax Attorney?

Our tax attorneys are also accountants and can help you understand both the legal and accounting aspects of your transactions. We can recommend any documentation necessary to support your tax position and can evaluate the accounting you have to provide you with a tax estimate. 

When Should I Hire a Tax Attorney?

If you are going to hire a tax attorney, it is always best to do so as soon as possible before a sale and definitely before the end of a tax year so that all tax reduction possibilities are available to you. It is important to acquire or prepare all the documentation prior to a sale or deadline to ensure the most in tax deductions possible. 

What Should I Bring to the First Meeting with a Attorney/Accountant?

Before speaking with a tax attorney, you should collect as much information and facts about your tax return, transaction, or sale as possible to share with the lawyer. Documents to share with your lawyer include:

  • 3 years of prior tax returns;
  • Any IRS correspondence you have received;
  • 3 years of financial statements (if applicable); 
  • Letters of Intent, Contracts, or legal documents (regarding any sale or transaction); and
  • Any documentation you believe would be helpful to understand your case.

Should I Finalize the Transaction First?

Before speaking with a tax attorney, you should be careful finalizing a sale, transaction, or filing a return when you still have questions. Initial filings have typically less than a 1% chance of audit while amended returns can have as high as a 3%-5% chance of audit. Correctly filing your tax return the first time can save you a lot of heartache and frustration. Additionally, negotiations are easier to finalize before all the details are settled. There are significant negotiation advantages when taking into consideration the tax consequences of different alternatives. Lastly, transactions can be structured using different types of assets and income variants to result in reduced taxes, therefore, having a tax attorney look at your life and business activities and transactions can result in significant tax savings. You should not sign anything until you have had an opportunity to discuss your matter with a lawyer.

If you are finalizing a sale or transaction, concerned about the tax consequences of an activity, a life event you think may have a tax consequence, or even if you have a question please call 801-375-2050 or email us at We proudly serve all 50 states. 

What to do next

If you are looking to save money on your taxes for a small or large transaction, it’s imperative that you seek counsel from an experienced attorney who will look at both the legal and numbers side of your tax situation. Because tax planning can often be deeply complex or require specific evidence/contract terms/sequencing, an attorney who specializes in such cases is your best option.

By finding the right local attorney to represent your interests, you can help ensure that you don’t pay a penny more than you are required under the Internal Revenue Code and state law. 

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