Electives: Taxation
C. Taxation
Tax Practice Overview
Most students are aware of at least some of the tax laws imposed by the
federal and state governments, but few know of the practice
opportunities available or even what a tax attorney does. Even if
you are sure that you will not become a tax attorney, the tax laws will
affect some area of your practice.
Those who choose to practice tax face many choices. Like any
other area of the law, there are transactional attorneys (those who
plan and negotiate personal and business tax "deals") and tax
litigators (those who fight the IRS and state tax agencies on behalf of
their clients). There are far more of the former, while the
latter tends to fall to small, boutique firms.
Tax attorneys also find themselves concentrating in one of a few broad
categories of tax practice:
1. Business;
2. Estate planning; or
3. International.
Those broad categories ignore a great deal of detail but help to give a
general idea of the types of practice. For example, a new tax
attorney might describe her practice as one dealing with transactional
business tax issues. She might be involved in forming new
business entities for entrepreneurs or advising investors in a real
estate deal about how the purchase of a new high–rise office complex
might affect their taxes for next year. Depending on the size of
her practice, she may be involved with negotiating the purchase or
merger of another business.
Another tax attorney might describe himself as an estate planner.
He would be involved with clients who wanted wills or trusts prepared
with a view towards minimizing the federal and state taxes involved
with transferring property. Depending on the client, he might
also be involved with business tax matters, e.g. the client might own a
small business that would be transferred or sold.
A third attorney might be involved with international tax litigation,
possibly in connection with a multinational group of corporations whose
US parent is buying raw materials from a foreign subsidiary, or,
depending on his language skills, he may be assisting foreign business
owners involved in a tax dispute in the US.
Tax Curriculum
For a practitioner in tax, the requisite core of knowledge consists of
approximately twelve areas:
1. Individual income tax;
2. Corporate tax;
3. Corporate reorganizations/consolidations;
4. S Corporation tax;
5. Partnership tax;
6. Estate and gift tax;
7. Estate planning (including generation skipping
tax);
8. Pensions and profit sharing;
9. Property transactions (like–kind exchanges, §
1231, basis issues);
10. Fiduciary income tax;
11. Proceedings before the IRS and Tax litigation; and
12. International tax.
Obviously, no JD program offers all of these courses. Currently
29 law schools offer an LL.M. in taxation, and these programs offer
interested students the opportunity to gain a world of perspective in a
year's time.
For any lawyer, Personal Income Tax is strongly recommended. As
mentioned above, nearly every area of law may deal with money, whether
as the subject of the representation or as the remedy.
For those interested in business, Business Associations and Business
Entities Tax should be taken. These courses provide the
background and analytical tools necessary to understand basic business
transactions, and also prepare students for more advanced coursework.
Finally, while it used to be assumed that any lawyer who graduated from
law school could draft simple estate planning documents, the laws (both
tax and non–tax) have become so complicated that serious malpractice
traps await the non–specialist. If your practice might include
advising clients with estate planning issues, the two class combination
Wills, Trusts and Estates followed by Estate Planning is a must.
One frequent question that many students ask when becoming interested
in the area is: Do I need to get an LL.M.? The answer right now
is no. Of course, having an advanced degree can never hurt, and
the LL.M. in tax marks someone as a tax specialist. More
frequently, firms are looking for those with either (1) an LL.M. in tax
or (2) equivalent experience. Additionally, many firms (and the
government) will pay for, or at least contribute towards, the tuition.
In the meantime (and in preparation for the job that will pay the
tuition bill), you can select courses to show that you are serious
about tax. Unfortunately (from the perspective of maximizing your
elective choices during your second and third years of law school), the
tax classes are lined up in series. This means that you must take
Personal Tax before you take Business Entities Tax, which you must take
before you take any of the advanced tax courses such as Business
Planning.
This in turn means that if you might consider tax as a career, you will
be best served by taking Personal Tax in the Fall of your second year,
followed by Business Entities Tax in the Spring. You should also
consider taking the two class combination Wills, Trusts and Estates
followed by Estate Planning.
Other business classes, such as Debtor/Creditor, Start–Ups, and Mergers
and Acquisitions are recommended. Each of these classes touches
on tax issues, and helps students place the tax concepts we study into
the larger perspective of the business world.
Students should also consider other related courses, including Family
Law, Real Estate Transactions, Non–Profit Corporations, Bankruptcy, or
Antitrust. Issues arising from concepts covered in these courses
may have significant tax implications, and the fact is that tax clients
frequently find themselves engaging in these types of
transactions. Having at least a minimal knowledge of these areas
makes the tax practitioner that much more versatile.
Essential
* Personal Income Tax: F
* Wills, Trusts and Estates: F, S
* Business Associations: F, S
* Business Entities Tax: S
* Estate Planning: S
Recommended
* Debtor Creditor: F
* Start–up Company Finance: S
* Mergers and Acquisitions: S
Related Courses
* Family Law: S
* Real Estate: F
* Bankruptcy: S
* Securities Regulation: F
Practical Skills
* Business Planning: F
* Non–Profits (TBA)
Related Upper–Level Writing Courses
* Business Planning: F
