If you are a small business, your time, money and assets are precious to you. Here are three reasons you will want to consider hiring a Business Lawyer who is both tax and accounting savvy as your next financial move.
Tax lawyers are attorneys with a special tax law degree, usually an LLM in taxation. They can be expensive but are valuable if ever you are in trouble with the IRS and need representation in court. However, your business attorney these days can and may very well be tax-savvy regardless of special degrees and fees.
- Saves Money. An attorney who is fluent in accounting can save your business money, especially in the long run. By having prior and current knowledge of basic accounting, your business lawyer can assist you with these basic skills and/or work with your CPA in harmony to achieve financial goals and milestones. Financial Statements. An attorney with a background in accounting can assist with statements of financial position, retained earnings, and income. A statement of financial position is commonly referred to as a balance sheet. The statement usually lists all assets, equity, and liabilities whether contributed by owners or earned by the business. Retained equity or earnings are generated by the entity and have been distributed as dividends. Statements of retained earnings report more detail about the earnings retained by the business. The income statement will list revenues and expenses incurred by a net income or a net loss. The period of time for the income statement can vary from 12 months to a month or quarter.
- The third and final reason is financial planning. During the course of your business’ life, you may want to or already have considered a capital investment. An attorney can provide you with assistance in this area as well. The structure and execution of financial dealing can be very complex. A manager or the owner will need to choose what avenue to pursue, debt or equity regarding the funding of relative costs, tax issues, and benefits. A lawyer with experience drafting investment agreements can be valuable when properly addressed in regards to the business.
A lawyer typically becomes familiar with accounting and investment by actual experience, schooling, or both. There are several certificate programs attorneys can and do enroll in order to gain knowledge and experience in both accounting and financial planning. The most common “law” related or legal specified practice area for lawyers to obtain a certificate in accounting is Estate Planning.
Estate planning is a set of legal, accounting, and financial services, usually directed toward investors, investment offices, business owners, and individuals with a high net worth. Some lawyers may have a certificate, Master’s, or LLM in Taxation regarding these areas of both business and investment. Estate planning as its core objective involves working with individuals to formulate and implement a tax planning and/or charitable contribution strategy. This helps the company or individual to realize their financial objectives.
If your attorney has a specialty degree or certification in Taxation, he or she will be qualified to handle the following:
- Research and apply tax laws in a variety of tax-related areas
- Prepare various types of tax returns for individuals and entities
- Become an IRS enrolled agent by taking the Special Enrollment Examination
- Become an IRS Certified Tax Prep Advisor;
- Substantially contribute to the tax-related work done by accountants’ and attorneys’ firms, and much more.
Specialty certifications in taxation can translate over to global and international affairs as well depending on the scope of training the attorney has undergone during course selection. This means the school in which the certification or specialty degree was obtained can offer a large variety of well-rounded coursework in order to be both up-to-date and to give the student options to tailor the program to more specifically meet the criteria or practice area the attorney would like to pursue.
When you sit down with your considered or current business lawyer it’s not a bad idea to discuss the financial credentials of the firm. If your attorney doesn’t have a certification in estate planning, he or she may have one of the following specific certifications instead:
- Chartered Trust and Estate Planner
- Accredited Estate Planner
- Certified Trust and Financial Advisor
- Chartered Wealth Manager
- Chartered Asset Manager, And more
It isn’t just the head attorney of the firm or small practice who may have expertise in accounting and business investing within the firm. There are certifications for paralegals as well. In-house and remote paralegals used by the firm may also have a certificate in business management, taxation, and many other legal and non-law-related certifications regarding accounting and investment or business management and planning. It is common for a paralegal to gain certification in the practice areas that the firm specializes in or would like to specialize in, in the future.
In conclusion, having such a professional who is skilled in these two critical aspects of a business
Tony Crighton is a practicing New York business lawyer who specializes in all legal matters related to business & commercial law, property law and contract law. He has been a practicing attorney for over 15 years and has a diverse and broad range of experience. Connect with him on Twitter and Facebook.