Tax Consultant

Tax consultants, also know as tax advisors are experts in tax law, planning, and compliance. They serve businesses and individuals alike by staying current on new tax law and positioning taxpayers for short and long-term tax optimization. A tax consultant typically expands on the role of a tax preparer. While tax consultants prepare tax returns, they also often work closely with clients throughout the year to ensure client tax liability is minimized. Tax consultants are strongly written and verbal communicators able to explain tax law and strategies in a way that is accessible and easy for clients to understand. Tax consultants work for public accounting firms, law offices, financial consulting firms and many even have their own independent tax preparation and consultation businesses. In all settings, tax consultants can be expected to perform duties that include:

  • Conducting research on tax laws
  • Strategizing with clients to minimize tax liability
  • Communicating with clients to explain tax issues
  • Preparing tax returns
  • Estate planning
  • Keeping clients compliant with their tax obligations

Producing written content is a significant part of the job, as tax consultants must communicate their research findings including changes in tax laws that create opportunities for new tax strategy. Because a tax consultant may have many clients affected by the same issue, the ability to draft a well-written and concise letter is often the most effective means of disseminating information to a number of different clients.

Estate Planning: Consultants who specialize in estates will help clients plan their estate in such a way as to minimize estate tax for the client’s heirs. This can be done using many different strategies, such as making annual tax-free gifts to multiple friends and family members to reduce the value of the estate or by creating a Credit Shelter trust to double the estate tax exclusions for married couples.

Business Tax Consultation
: Tax consultants specializing in business entities will help clients strategize to minimize income taxes owed by the business and shareholders, as well as tax planning for closely held businesses. These consultants are experts in business structures and establish closely held businesses as a means to eliminate double taxation at the business and individual level once profits are transferred to the owners.

Sales and Use Consultation
: Sales and use tax consultants are increasing in popularity as many business taxpayers have found that this is an often overlooked area of tax planning. Often businesses will discover that they are being taxed on products and services that should not be taxable. For example, many states do not charge sales or use tax on repair expenses associated with manufacturing equipment. However, without any notification otherwise, vendors unfamiliar with state-specific tax policies may mistakenly charge tax to these large manufacturing companies. Sales and use tax consultants will ensure accuracy and compliance in filing sales and use tax returns.

Engineering Tax Consultation
: There are many Federal and State programs designed to provide tax benefits to companies performing research to develop new products, patents, prototypes or processes. The process to claim these credits can often be time-consuming, but economically worthwhile. Engineering tax consultants are employed to ensure that all of the possible credits are received.

Tax Analysts and Senior Tax Analysts

Tax analysis is typically associated with the title Senior Tax Analyst, as this is a senior position most often found in large business organizations including investment funds brokerages, non-profit organizations, and educational institutions, although jobs are also available at accounting firms and with the IRS. Tax analyst is generally not a first job for new college graduates, as many organizations are looking for someone with at least a year of accounting or related experience. Many organizations prefer applicants who are CPAs, especially for senior positions. Tax analyst jobs are usually highly specialized and designed to cater to the many different types of tax obligations a larger organization is likely to have. There are a number of titles held be tax analysts working in specialized roles:

Income Tax Analyst
An income tax analyst is simply a tax analyst who focuses on income taxes, including understanding income tax laws and how to comply with them. Responsibilities may include:

  • Assisting with federal and state income tax audits
  • Calculating quarterly estimated tax payments
  • Helping with tax planning for mergers and acquisitions, including due diligence reviews
  • Maintaining the internal tax compliance software system
  • Participating in the quarterly and year-end tax provision calculations and in overall business tax planning

Depending on the size of the organization, a tax analyst may deal with all income taxes or the organization may hire analysts specifically for federal taxes or state taxes.

International Tax Analyst: For organizations with international operations, an international tax analyst focuses specifically on international tax compliance and reporting for foreign operations, including tax planning, research, foreign tax credit projections and audit activities. Job duties may include:

  • Assisting with tax-planning and implementation strategies to reduce worldwide tax liabilities through the use of tax laws, regulations, rulings, and other legal precedents
  • Helping maintain worldwide intercompany transfer pricing policies and procedures (the movement of products from one division of a company to another)- some large companies even hire tax analysts specifically to handle transfer pricing issues
  • Researching and understanding U.S. international tax law, including foreign tax credits and foreign source income

International tax analysts can earn the designation Certified International Tax Analyst (CITA) through the American Academy of Financial Management (AAFM). Applicants for CITA must meet two of these requirements:

  • A financial, investment, accounting, tax or economics related degree accredited by either the Accreditation Council for Business Schools and Programs (ACBSP), Association to Advance Collegiate Schools of Business (ACBSP), American Bar Association (ABA) or European Quality Improvement System (EQUIS), plus a minimum of three years of professional experience
  • Either a government recognized degree or license, such as an MBA/Masters or Law Degree, PhD, CPA or other recognized designation, or a related degree from an AAFM-approved and accredited university program
  • Completion of Online Executive Certification Training Programs with a designated law school

Property Tax AnalystTimely and accurate return filings, assessment review, appeals filings and payment of property taxes is the purview of a property tax analyst. Job responsibilities may include:

  • Preparing and filing property tax returns
  • Analyzing property tax assessments and reconciliations
  • Reviewing and processing property tax payments
  • Dealing with property tax correspondence and notices from tax authorities
  • Maintaining internal quality control policies and procedures concerning property taxes
  • Researching issues around property tax compliance

Payroll Tax AnalystA payroll tax analyst needs to understand the laws and regulations concerning payroll administration and paying payroll taxes and have an overall knowledge of all payroll deductions, federal and state withholdings, and check processing.

Job responsibilities of a payroll tax analyst may include:

  • Maintaining accounting databases that track payroll tax activity
  • Making payroll tax deposits
  • Filing payroll tax returns (both federal and state)
  • Processing and filing W-2 forms (end of year forms reporting each employee’s income)
  • Processing information on new employees, terminations, direct deposits, and W-4 forms (forms that employees fill out specifying number of withholding allowances)
  • Maintaining policies and procedures to support the payroll tax filing process
  • Researching and resolving payroll tax, compliance, and accounting issues

The American Payroll Association offers a Certified Payroll Professional (CPP) designation that would be well suited to these more advanced analyst positions. Transactional Tax AnalystA transactional tax analyst combines the responsibilities of several of the other types of tax analysts. Transactional taxes include sales and use tax, business and occupation tax, gross receipt tax, and property tax. For businesses that operate internationally, transactional taxes include GST in Canada and value-added taxes (VAT) in many other countries. Responsibilities include:

  • Preparing transaction tax returns for monthly, quarterly, and annual filings
  • Interpreting and complying with state, local, and international statutes, regulations, and legislation
  • Researching transaction tax issues and providing guidance on these issues
  • Dealing with transaction tax audits.
  • Assisting with the reconciliation of transaction tax general ledger accounts
  • Configuring and maintaining transaction tax calculation software
  • Developing, implementing, and improving processes for the calculation and collection of transaction taxes

Fund Tax Analyst: Another opportunity for tax analysts is with mutual funds, hedge funds, and investment partnerships. In addition to dealing with federal, state, and foreign tax laws and tax filings, these fund tax analysts or investment tax analysts also prepare year-end tax reports for investors.

IRS Tax Analyst:
The IRS also hires tax analysts to fulfill job duties that include:

  • Developing or interpreting guidance on program planning, execution, and evaluation in regards to taxpayer compliance, taxpayer account management or taxpayer education and communication
  • Providing technical advice and staff assistance to executives, field managers, and employees in the assigned program area
  • Interpreting, developing and coordinating analytical reviews of new policies, procedures and program requirements.