Handle the IRS Yourself or Hire an Enrolled Agent, CPA or Tax Attorney?

Many IRS problems can be handled on your own, at no cost, through IRS.gov or by contacting the IRS directly. A professional earns their fee when the case is complex: several unfiled years, a business, an audit, an offer in compromise or a levy already in place. And a tax attorney is the right choice when there is a legal dispute, a Tax Court case or any chance of criminal exposure.

This guide helps you work out which situation you are in and who to call.

What you can usually do yourself

The IRS has made many common fixes available directly to taxpayers:

• Set up a payment plan. Many individuals can apply for an installment agreement online without speaking to anyone.
• Ask for first-time penalty abatement. If you have a clean recent history, you can ask the IRS to remove certain penalties.
• Check whether an offer in compromise is worth pursuing. The IRS's pre-qualifier tool on IRS.gov gives a free first look.
• View your balance and transcripts. An IRS online account shows what you owe, your payment history and your tax records.
• Respond to a notice. Many IRS letters just need a reply, a payment or a corrected return by a deadline.

If your situation is a single balance from a filed return and you can afford monthly payments, doing it yourself is often the best value. A tax relief firm would apply for the same payment plan and charge you for it.

When a professional is worth it

Consider paying for help when one or more of these apply:

• You have several years of unfiled returns
• The IRS has already levied your bank account or garnished your wages
• You run a business, especially with unpaid payroll taxes
• You are facing an audit or an appeal
• You want to submit an offer in compromise, which requires detailed financial disclosure
• You owe a large balance and need help with financial statements
• You find IRS letters overwhelming and keep missing deadlines

A good representative can communicate with the IRS for you after you sign a power of attorney, which is IRS Form 2848. They can also request a pause in collection while they work on your case.

Enrolled agent, CPA or tax attorney?

Enrolled agents, CPAs and attorneys all have unlimited rights to represent taxpayers before the IRS. The differences are in training and focus.

Enrolled agents are tax specialists licensed directly by the IRS. They earn the credential by passing a three-part IRS exam or through qualifying experience as an IRS employee, and they must keep up continuing education. For most collection cases, such as payment plans, offers in compromise and penalty relief, an enrolled agent is a strong fit. Firms such as Blueprint Resolution Services and Anthem Tax Services say enrolled agents handle their cases.

CPAs are licensed by state boards and cover accounting broadly. Not every CPA specializes in IRS collections, so ask about their experience. A CPA is especially useful if your tax problem is tied up with business records, bookkeeping or complicated returns that need preparing.

Tax attorneys are lawyers who focus on tax law. You may want one if your case is heading to Tax Court, involves a dispute over whether you owe the tax at all, or carries any risk of a criminal investigation, for example years of unreported income. Communications with an attorney are protected by attorney-client privilege, which is broader than the limited privilege available to enrolled agents and CPAs. Firms such as Optima Tax Relief and Tax Group Center say they have tax attorneys on staff.

Tax relief firm or independent professional?

You can hire an independent enrolled agent, CPA or attorney directly, or go through a tax relief firm that employs them. Firms often advertise widely and run a set process, while independent professionals may offer a more personal service. Neither is automatically better.

Whichever you choose, ask:

• Who will actually handle my case, and what is their credential?
• What resolution do you expect, and why?
• What is every fee, and what happens if the IRS says no?

Our guide on how tax relief companies work and what they charge covers fees and refund terms in more detail.

How to check credentials

Before you sign, verify the person's credentials:

• Enrolled agents and CPAs: the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications lets you look up many credentialed preparers.
• CPAs: your state board of accountancy can confirm a license.
• Attorneys: your state bar association lists licensed lawyers and any public discipline.

If a company cannot or will not tell you who will work on your case, that is a warning sign.

Free and low-cost help

You do not have to pay for help if you qualify for free services:

• Taxpayer Advocate Service (TAS). An independent organization within the IRS that helps taxpayers facing financial hardship or IRS problems that have not been resolved through normal channels. Its help is free.
• Low Income Taxpayer Clinics (LITCs). Independent clinics, often run by law schools and nonprofits, that represent eligible low-income taxpayers in disputes with the IRS for free or for a small fee. Many also help people who speak English as a second language.

You can find both through IRS.gov. If your income is low, check these before you hire a paid firm.

The bottom line

Start by looking at your IRS online account and the options available on IRS.gov. If you can afford monthly payments, set up a plan yourself. If your case is complex, hire an enrolled agent or CPA with collection experience. If there is a legal dispute or any criminal risk, talk to a tax attorney. And whoever you hire, remember that the IRS makes the final decision. To compare firms that offer representation, see our tax relief company rankings.