Practice Role
A tax professional’s practice role is about the function they serve when assisting clients. Specifically, does the tax adviser assist with planning, compliance, controversy, or some combination? Thus, is the tax adviser primarily involved before transactions occur, between when transactions occur and when returns are filed, or after returns are filed?
Planning
Tax planners help clients arrange their affairs prospectively to achieve the client’s business, economic, and financial goals while minimizing tax. For example, these tax advisers help clients make choice-of-entity decisions, structure cross-border transactions, or plan their estates.
Compliance
Tax professionals doing compliance work help clients determine how to report their tax matters appropriately to government authorities. These tax advisers analyze events that have already occurred to determine how to reflect them on returns. However, a tax compliance professional may also be involved during the planning process if the reporting decisions are complex.
Controversy
Tax controversy lawyers handle disputes about taxes, including audits and refund requests. These lawyers are typically involved after transactions have occurred and after returns have been filed. However, a tax controversy lawyer may be consulted earlier to help preemptively prepare for a dispute if a matter is expected to be contentious.
Practice Setting
People with law degrees pursue tax careers with different types of employers, including law firms, accounting and consulting firms, government, industry, and academia.
Law Firms
Tax lawyers at law firms tend to do planning and controversy work, but they typically do relatively little compliance work. Tax work at law firms tends to be more qualitative and less quantitative than the tax work at accounting or consulting firms.
Accounting and Consulting Firms
Many tax-focused JDs also work at accounting and consulting firms that provide tax services. These tax advisers commonly perform planning and compliance work and, as a result, are essential parts of a client’s team of advisers. However, tax JDs working at accounting or consulting firms in the United States can provide tax advice but may not practice law. As a result, the drafting of contracts or other legal documents that effectuate the results of planning work is generally not done at accounting or consulting firms.
Government
Tax lawyers handle tax controversies (both civil and criminal) on behalf of the government, respond to ruling requests from taxpayers, and assist with drafting regulations and other administrative guidance, among other responsibilities. Tax lawyers also serve as Tax Court judges or clerks for such judges. Also, tax lawyers assist with drafting tax legislation (e.g., working in the Office of Legislative Counsel), serve as experts for various legislative committees (e.g., for the House Committee on Ways and Means), and work on the staff of individual legislators. There are opportunities for JDs to pursue some of these careers, particularly in controversy and legislative/regulatory policy/drafting, at both the federal level and the state and local government level.
In-House
Tax lawyers may also work in-house at for-profit or non-profit organizations. In-house work may involve a combination of planning, compliance, and controversy work. In most companies, tax professionals work in a tax department that reports to a chief financial officer. Still, some in-house tax lawyers may work in a legal department led by the company’s general counsel. Entry into in-house tax positions is typically limited to experienced tax professionals. Thus, most tax-interested law school graduates work for at least a few years at a law firm, accounting or consulting firm, or in government before moving to an in-house position.
Academia and Policy Centers
A small number of tax lawyers work in academia, where we teach students about the tax law, perform research, write about the tax law, and participate in the governance of our institutions. Many tax academics head low-income taxpayer clinics, combining the education of aspiring tax lawyers with a practice that serves vulnerable taxpayers who otherwise may not be able to afford tax advice. Tax lawyers also work for public policy think tanks such as the Tax Foundation or the Tax Policy Center.
There are numerous possible combinations of practice areas, practice roles, and practice settings, meaning there are many different tax law career paths. Whatever your tax career goals, don’t forget that all of us, across tax practice areas, roles, and settings, also have the opportunity to contribute to the public good (e.g., through pro bono work), to the tax profession (e.g., by participating in professional organizations such as the ABA), and to the development of tax policy and the particulars of tax law (e.g., by commenting on legislative or regulatory proposals). I encourage you to seize the opportunities as part of whatever tax practice path you pursue.