Corporate Tax Solutions for Attorney’s and Law Firms have specialized tax accounting and tax preparation needs.
Law firms and solo practice attorneys are a specialty area of corporate and partnership tax. Law firms will typically operate on a cash basis of tax accounting, which means that they report income when they collect their fees from clients or resolution of a court proceeding. Fees are normally charged either on an hourly basis or on a contingency fee basis, although some firms also use a hybrid of hourly and contingency billing methods.
Corporate tax accounting for law firms requires skill in identifying when income becomes taxable. This can be a challenge due to the use of trust accounts for fees, and litigation settlements, as well as the requirement of court approval of fees in some matters.
Equally challenging can be the determination of what expense can be deducted during the case and when.
As a CPA who has worked with all types of law firms, solo practitioners, multi office large firms, and even practicing judges I know the ins and outs of law firm accounting. Here are 3 typical trouble spots we address:
At Trippon & Company CPAs we use our 20+ years of experience in law firm corporate tax to minimize your Federal tax liability. Call us at 713-661-1040 and put our experience at work for you!