Tax Relief Firms – Is it a Law Firm, Accounting Firm, Or Something Else?

The tax relief industry has experienced significant change over the past several years. As the economy worsened and Americans faced increased financial pressures, many people and businesses sought relief from the strain by not paying their taxes. In response, an enormous number of tax companies started sprouting up to absorb the unprecedented demand for tax services. Tax gurus on late-night TV and radio advertise, they’ll “settle your tax debt for pennies on the dollar.” Despite being tax geeks ourselves, we couldn’t make sense of which tax companies are good and which are bad.

Tax Relief Firms – Choosing the Right One For You

Under the broad umbrella of “tax relief firms,” there are three types of professional firms: Law firms, CPA Firms, and Hybrids. The first two types are self-explanatory, and since there’s really no industry-standard name for the latter category, calling them a “hybrid” is probably acceptable. But which of the three categories is right for you?

Law Firms

As you know, a law firm is made up of ONLY lawyers. A law firm may employ assistants, like paralegals, but a tax attorney is ALWAYS the person ultimately responsible for any tax work performed. All tax attorneys employed by a law firm are subject to the ethics rules and disciplinary action of their state bar. A tax attorney may generally represent any client in any state on any U.S. federal income tax matter.

The pros to employing a law firm are that you can feel comfortable that (i) an attorney is the one ultimately responsible for your tax matter, (ii) you have a clear method to file grievances (i.e., with the sate bar) if the attorney screws up, and (iii) lawyers are subject to strict ethics rules so they should work according to the highest of standards. The cons are that law firms generally are more expensive than the other two types of tax firms. Additionally, some law firms (or attorneys) do not focus solely (or even primarily) on tax related work, so they may lack some of the skill and expertise needed to fight the IRS. Just ask your attorney what other types of work he or she performs, and that will give you a sense of whether tax (and specifically, tax relief) is his or her specialty.

CPA Firms

At CPA firms, you will obviously find CPAs (i.e., certified accountants), but you may also find tax attorneys. Like law firms, it’s nice to know that at CPA firms, there is a professional behind the scenes who is ultimately responsible for any tax work performed on your behalf. The pros and cons of CPA firms are similar to those of law firms, except the method of reporting grievances with CPAs isn’t as well defined (but exists nonetheless) as it is for attorneys. CPA firms are generally a little less expensive than law firms.

“Hybrid Firms”

The hybrid firms include tax relief firms that are not law firms or CPA firms. Tax relief firms in this category employ a mix of tax professionals, including tax attorneys, CPAs, and so-called “Enrolled Agents.” Enrolled Agents are tax professionals certified by the IRS. They are neither attorneys nor CPAs, but are tax professionals that the IRS has concluded (either through examination or experience) that they are qualified to represent taxpayers before the IRS.

Many tax relief firms fit in the “hybrid” category. Lots of the tax firms that advertise on the internet and radio are made up of tax attorneys, CPAs and enrolled agents and thus are hybrid tax relief firms. The pros are that these companies generally charge less for tax relief work and are very good at performing tax services and working with IRS since tax controversy work is their specialty. The cons are that unlike law firms and CPA firms, these hybrid firms are largely unregulated, so there’s no clear channel (like, for example, the state bar for attorneys) to file grievances. Since they are unregulated, many of the hybrid firms are just plain bad and if they rip a client off, there’s little recourse, except the traditional routes of going to the BBB or other quasi-regulatory bodies.

Tax Relief Firms – Is it a law firm, a CPA firm, or a hybrid?

Here’s how you can determine whether a certain tax relief firm is a law firm, a CPA firm, or a hybrid firm. First, don’t assume anything just because an attorney or CPA works at the tax firm. As explained above, this is meaningless. Second (and the most obvious), just ask! A tax relief firm should have little problem telling you how it’s organized.

Starting a Law Firm, Moving to a New State

Starting a law firm can be tough. Trying to build your new law firm can be even tougher. Starting a law practice completely from scratch in a new jurisdiction could be fatal.

Many times, people starting their own law firm will leave an old firm with a bevy of client who they had represented under the old firm’s moniker. This is a perfectly acceptable way to start a new law practice. It is done many times and it will continue to be done. Think about it – if you already have a client base (or “book of business”) intact, you don’t need to worry so much about marketing and client development. Your only real worries initially are setting up a new corporate structure, a new office and the vagaries that go with that, malpractice insurance, and general institutional kind of work. Don’t get me wrong, that isn’t easy, but it appears much more doable when you know you have clients who are going to pay for those things.

However, moving to a brand new state with no clients AND trying to start your own law firm, is a whole different ball game. Not only do you have to worry about the institutional kinds of things every lawyer starting a law firm has to worry about, you also need to worry about how you are going to pay for this stuff while you build a client base. The very idea of it would discourage even the most ambitious man.

This article is not meant to discourage, though, it is meant to enlighten. When moving to a new state to start a law firm, you, of course, must be licensed in that particular jurisdiction first. Once you are licensed, the game is essentially on. The name of the game is marketing – something nobody teaches you in law school. (As an aside, this is where a joint MBA/JD degree would really come in handy).

So, how do you market your new law firm when you are moving to a new state? Simple, you get out there and hustle-n-flow. Another name for it is “networking”. In order to be successful in any business, let alone starting a law firm, you have to network and create a network. After all, starting a law firm is all about people and connections. Your clients connect with you. You connect with the court and court staff, including the judge or jury. Your business colleagues connect with you. How do you connect, again, get out there with your name and do good work. Be organic. Plant a seed and make it grow. Sound tough? It is.

It takes time and effort and failure. One of the hardest things an entrepreneur is faced with is failure. But, failure can be a good thing if you make it work for you instead of against you. An entrepreneur learns from failure and turns it into a positive. Life is about experiencing, learning, and failing – and then getting back up again.

So, if you think you have it in you to accept failure and keep on truckin’, you may be ready to move to a state and start and build a law firm.

Top 4 Business Mistakes Law Firms Should Avoid

The business of law has its own set of rules and regulations. Nevertheless, as with any other businesses, it can suffer due to certain mistakes, industry inaccuracies, and errors made by law firm or its staff. Whether your law firm is large or small or whether you have a solo practice, these business mistakes can lost you dearly.

Given below are the four most common business mistakes that law firms should avoid

1. Not Focusing on Your Niche

This is particularly applicable to smaller law firms and solo practices. In an attempt to gain more clients and business, there is a temptation to spread yourself too thin and take on cases outside your area of expertise. Don’t give in to this temptation. Focus on your niche, as it allows you to deliver greater client satisfaction that will automatically enhance business and profitability. Once you are well established, you may expand the services your firm provides by hiring experts in other areas. Larger law firms that handle diverse cases should assign specific areas of work such as corporate law, environmental issues, and real estate to specific people. Having everyone look at everything is a sure recipe for disaster.

2. Not Marketing Effectively

Some law firms do not believe in marketing at all and want to rely completely on word of mouth and referrals. This is a mistake. At the other end of the spectrum are law firms that spend heavily on advertising and are puzzled by the lack of results. Marketing is an essential tool to promote your law business, but it needs to be used intelligently to offer maximum value. It is not necessary to have a full-page ad in a national newspaper. You may get better results with a small ad in a local magazine that has a greater chance of being read by your target clients. Your website can also serve as a cost-effective marketing tool.

3. Not Paying Attention to Receivables

Providing the best services to clients costs money, but when clients don’t honor their bills on time, most lawyers are reluctant to follow-up. Some clients may take advantage of you and delay payment even further. If this situation continues, you will be left low on cash, which will ultimately affect the quality of service. Remember that clients will not leave your firm because you ask them to pay what they owe, but they will surely leave if your level of service goes down.

4. Not Communicating with Clients

Not communicating is a common mistake that most lawyers commit without even being aware of it. The volume of work in a law firm is so large that you tend to be overwhelmed and may actually have no time to communicate with your client. Sounds unbelievable? But it is true. Communication with your clients is very important for business. You may be working very hard for their interests, but they need to know it. Giving regular updates to your clients by phone or email is essential. These are some of the most common business mistakes that law firms regularly make. Avoiding these mistakes will help keep your clients happy, and you will be able to retain them longer than you would otherwise.

The Golden Rules

  • Find your niche and become an expert in it
  • Market yourself well
  • Pay attention to cash flow
  • Stay in touch with your clients

Wikipedia Marketing – Use a Wiki to Market a Law Firm Or Practice

Wikipedia is a very important tool in a tech-savvy legal marketers’ arsenal. Web technologies like RSS from blogs, wikis, forums, and other kinds of channels into feed-enabled portals create buzz about an attorney or law firm.

Wikipedia has a massive traffic volume and influence in search engine results. The site also tends to attract a tech-savvy audience that researches RSS and other Web 2.0 technologies. Presented carefully, a strong presence for a law firm with relevant Wikipedia entries can help drive traffic to the Firm’s website. In the ever-expanding world of social computing, it makes sense for firms and attorneys to take the plunge into Wikipedia, but it is just as important to learn the rules of the game first.

GETTING STARTED

When creating the firm or attorney page, first check the state bar’s rules for the filing requirements for public advertising and written, recorded, electronic or other digital solicitations. In Texas, all attorney advertising copy must be submitted to the Advertising Review Department. However, since Wikipedia entries are assumed written by a neutral third-party the pages don’t officially fall into the “advertising” category.

Here is the official word from the Texas State Bar Advertising Review Department Director Gene Major; “Read the Texas Disciplinary Rules for Professional Conduct. Rule 7.07(e) lists the type of exemptions the Bar allows without submission for approval from us. These exemptions include publicly available information about the attorney or law firm, business card-type information about practice areas, firm website and information concerning legal issues, such as news articles, legal articles, editorial opinions, or other legal developments or events.”

Before constructing the framework for the Wikipedia page, the best advice is to list everything planned for the page, then read the individual state bar’s exemptions rule on filing requirements and make sure nothing on the Wikipedia list contradicts the state bar rule.

Wikipedia’s strict content guidelines must also be addressed and understood thoroughly. Wikipedia’s editors are basically anyone who owns a computer, and they can be merciless. Wikipedia defines itself as: an encyclopedia, not a forum for advertising or self-promotion, or a vanity press. As such, it should contain only material that complies with its content policies, and Wikipedians must place the interests of the encyclopedia first. Any editor who gives priority to outside interests may be subject to a conflict of interest.

There are no firm criteria to determine whether a conflict of interest exists, but there are warning signs. Adding material that appears to promote the interests or visibility of an article’s author, its author’s family members, employer, associates, or their business or personal interests, places the author in a conflict of interest. When editors write to promote their own interests, their contributions often show a characteristic lack of connection to anything the general reader might want to consult as a reference.

When constructing a page if its decided to write an article on an area of law where there is personal involvement, be sure to write in a neutral tone and cite reliable, third party published sources, its important to beware of unintentional bias. A neutral point of view is the key to success on Wikipedia.

The best learning tools here are examples. Houston attorney Mark Lanier’s page is a good model of how to write a Wikipedia entry properly. It can be found here: http://en.wikipedia.org/wiki/W._Mark_Lanier

You will notice Lanier’s page is categorized under American Lawyers/Living People. A page’s category is an important designation. According to the Wikipedia article traffic statistics (http://stats.grok.se/) Lanier’s page has been visited 246 times in June of 2008.

A law firm that created their Wikipedia entry properly can be found here:
http://en.wikipedia.org/wiki/Skadden%2C_Arps%2C_Slate%2C_Meagher_%26_Flom

This firm categorized their entry under: Law firms of the United States | Law firms established in 1948 | Law firms based in New York City. According to the traffic counter, their page has been viewed 6,508 times in June of 2008. That’s a strong audience.

Along with the successful pages we should also cite examples of problem entries. Haynes & Boone is a good cautionary tale. Their page can be found here: http://en.wikipedia.org/wiki/Haynes_%26_Boone

You will notice there is a warning header at the top of the page listing the entry as being written as an advertisement. Judging from the length of the page a lot of work went into building it. But there aren’t any external links except self-promoting websites and there are no references listed. Whoever wrote this entry probably thought the link to the firm’s website would be enough to justify the time and effort it took to build the page. However, a quick check of the page traffic counter shows the page was visited once in May and not at all in June. It is important to cite sources and make sure other articles link to the page from related topics. Make content relevant for the Wikipedia community, not just the firm.

CASE CITATIONS

You will notice from the Mark Lanier page example citations of some of his flagship cases. These cases should not be cited unless they are considered closed by the courts and all parties involved. If an attorney is involved in a court case, or close to one of the litigants, it would be very difficult to demonstrate that what is written about a party or a law firm associated with the case, or a related area of law, was entirely objective.

The courts or their parties could potentially notice even a minor slip up in neutrality in a court-case article on Wikipedia for an active case-in-progress, and this could potentially cause real-world harm. Because of this, restrict case citations and edits on other Wikipedia pages to cases officially closed.

STEPS FOR DEVELOPING THE PAGE

1. Research State Bar Professional Conduct Guidelines for filing requirements.

2. Research Wikipedia’s guidelines for content creation and editing, including standards for writing style, formatting, editing, adding links, etc.

3. Study the attorney and firm pages listed in this article and notice how they crafted their page, then make it easy on yourself and copy them with your own content.

4. Choose the proper category for the page. Study other related firms and attorney pages to distinguish the particular area that will most benefit your practice.

5. Find someone outside of your organization to do the actual development of the entry to avoid being deleted by Wikipedia’s conflict-of-interest policy.

6. Craft practice articles in the Wikipedia Sandbox:
http://en.wikipedia.org/wiki/Wikipedia:Sandbox The Wikipedia Sandbox section of the site allows members to post draft articles, experiment with formatting, tone, and linking strategies, and receive feedback from the community

7. Write articles according to Wikipedia’s neutral point-of-view standards, which discourages users from putting spin or bias in articles. Remove all the slick marketing hype for the copy. This sentence, for instance, is similar to something that would appear in company marketing materials:
o “XYZ Firm is a diversified law practice focused on the highest level of customer service”
For Wikipedia, it needs to sound like this:
o “XYZ Firm is comprised of attorneys representing a number of diverse practice areas including, Intellectual Property, Maritime Law and Business Litigation.”

8. Strategically link related pages within Wikipedia. Guidelines state that content creators should provide relevant links to other Wikipedia articles.

9. Use external links to send traffic to a Firm’s site. Hotlinks are permitted in certain sections of a Wikipedia article, such as External Links. Be sure to add links to relevant Firm Web pages where possible. Use concise, targeted pages relevant to the Wikipedia article in question, rather than just linking to the company’s homepage. Add links to the firm’s Web pages, data sheets, and white papers in an article’s “References” section. Include links to third-party sites on company-specific pages to demonstrate neutrality.

Finally, take all the valuable content just created and add value to the Wikipedia community by expanding the information available on RSS technology.

TRACK THE RESULTS

Starting with the article traffic statistics, track how many people are visiting the Wikipedia page. Be sure to monitor where clients are hearing about the firm and keep a record of the new calls into the office and be sure and ask the client where they heard of the firm.

Wikipedia is a collaborative, constantly evolving site, and a firm’s page must be constantly monitored. The team responsible for overseeing the page must constantly be aware of edits to the page, participate in ongoing discussions about pages, and look for opportunities to add more relevant, useful content to the site. Provide value to the Wikipedia community and reap the rewards!

How to Become a Partner in a Law Firm

Becoming a partner in a law firm is an objective for most lawyers. Partnership entails successfully running the law firm and meeting the expectations of your partners and clients. Lawyers who want to make partnership have to dedicate several years to building good reputation inside and outside their law firms. This usually requires consistently performing good work, earning the respect and admiration of the junior lawyers, the partners and clients they work for. It also requires staying active in their local bar associations and publishing articles on related legal issues.

Lawyers frequently think that being a good lawyer will be sufficient to qualify them for partnership appointment. Being a good litigator is certainly a big part of the criteria for partnership in a law firm. However, there are usually numerous other factors that are taken into consideration for eligibility for legal partnership.

Why is it important to become a partner in a law firm?

As a beginner in the legal world, a lawyer needs to work as a trainee in a law firm for a few years. To succeed as a lawyer, you need to have a clear understanding of the law and get to know the inner workings to help you win cases. Once you have gained enough experience and earned a reputation for winning cases, your chances of becoming a partner is close to reality.

Being a partner has lots of benefits. One of these is become a part owner of the firm and acquiring a share of the profits. A law firm partner also has a right to vote on decisions made by the firm which will include voting on how profits are distributed, making decisions involving the appointment of future partners and deciding the types of clients to represent.

How can a lawyer work up to become a law firm partner?

Being a partner starts with having a common goal and a vision of how you are going to become a part of a law firm and reach the important milestones in your legal career.

Here are tips to successfully become a law firm partner;

Number One
Work the hours: More hours are better.

Number Two:
Bring in new clients: Working hard is a given but a lawyer must also bring new business to the law firm.

Number Three
Be proactive: Anticipate and plan for the future before it transpires. These efforts will please partners and clients.

Number Four
Be result-oriented: Strive to deliver results quickly.

Number Five
Be a team player: The best lawyers are team players who take a personal interest in the firm’s success.

Number Six
Respect firm employees: Treat every staff member the same way you treat your boss.

Number Seven
Practice consistency: Success results from exercising good habits every day. Do not delay and be prompt when responding to any legal concerns.

Number Eight
Accurate time sheet filling: Filling your time sheet truthfully and on-schedule is the best of establishing credibility.

Number Nine
Create work-life balance: The legal profession can be demanding. Therefore, it is very important that you ensure you maintain work-life balance focusing on your family and your health.

Living the life of a professional litigator is challenging. Therefore, having the drive to succeed is not enough. You must also be smart and to prepare yourself for partnership. Those actions will exemplify your true desire for success in the legal profession.