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Tax Issues and Opportunities
Because they review a client's financial affairs regularly, accountants are in a position to recognize tax issues, and opportunities for appropriate tax and estate planning. However, tax is a broad and complex area, and although accountants who specialize in compliance may be familiar with certain types of planning, they may not be completely comfortable dealing with the wide range of tax and estate planning issues and opportunities.
Tax Traps
It is not uncommon for an innocent looking transaction to have serious adverse tax results. An accountant who is not a tax specialist may wish to have us review any proposed transactions with which they are not thoroughly familiar to ensure that such tax traps are avoided.
Compliance Accountants
If an accountant wishes to have a client consider possible tax or estate planning that is outside the accountant's expertise, we can provide analysis and planning, as well as implementation or supervision of the implementation of a plan. Such accountants may wish to invite us to engage in an initial review of a client's affairs with them and to provide suggestions regarding possible planning and an estimate of the probable overall fees.
Tax Planning Accountants
If an accountant is familiar with certain areas of tax planning, or specializes in tax and estate planning, the accountant may wish to provide us with a detailed plan and ask us to do the implementation work itself, or to supervise the implementation. Such a tax planner may find it convenient to have the implementation done or organized by us since we would be familiar with the tax issues involved and the ways those issues can be addressed in legal documents. Our fees for implementation are significantly lower than our fees for the combination of planning and implementation.
Non Disclosure
If a tax planning accountant wishes us to implement a proprietary transaction, we can enter into a confidentiality agreement so that the accountant has comfort that that we will not utilize or reveal the features of such a transaction unless it enters the public domain through no fault of our own.
Privilege
In addition to being confidential, most communication between a lawyer and client relating to legal advice, including tax planning, would be subject to Solicitor-Client Privilege, which would normally protect such communication from disclosure.
Solicitor-Client Privilege would not normally apply to tax planning performed by an accountant. However, it is possible that Solicitor-Client Privilege may apply to the work of a tax accountant if the accountant functions as the agent of the client for the purpose of assisting counsel in formulating a plan, and any tax opinion is drafted and signed by counsel.