Summary
This post explains the practical difference between what a CPA handles and what an attorney handles for a growing business, and highlights where the two overlap, entity structure, business sales, and succession planning, where both are needed at the same time. Includes a real-world example of a business that got the tax side right but left the legal side unaddressed. Closes with a call to book a Risk-Free Strategy Session.
By: Jordan Gerheim, CEO – Outside Chief Legal LLC
Many business questions land in a gray zone where it is not immediately obvious whether the right call is to a CPA or a lawyer. Entity structure, contracts, tax elections, and compliance all overlap enough that business owners often guess wrong, calling one when they needed the other, or assuming a single advisor can handle a question that actually needs both.
Here is a practical way to think about the split.
What a CPA Handles
A CPA’s core expertise is the numbers: preparing and filing tax returns, advising on tax strategy, managing bookkeeping and financial statements, and handling payroll and compliance from a tax and accounting standpoint. If your question is fundamentally about how much you owe, how to reduce a tax bill, or how your financial statements should be structured, that is CPA territory.
CPAs also play a role in entity tax elections, whether an LLC should elect to be taxed as an S corporation, for example, since that decision has direct tax consequences that a CPA is best positioned to model out.
What a Lawyer Handles
An attorney’s core expertise is the legal structure and obligations: drafting and reviewing contracts, forming and structuring the entity itself, handling disputes, managing regulatory compliance, and advising on the legal consequences of a business decision. If your question is fundamentally about what you are legally obligated to do, what you are exposed to, or how an agreement should be worded to protect you, that is attorney territory.
Where the Lines Actually Blur
Entity structure is the clearest example of where both professionals are genuinely needed at the same time. Forming an LLC and deciding how it should be taxed are two different questions that happen to be closely related. The operating agreement, which governs ownership, control, and what happens if a partner leaves, is a legal document that a CPA is not positioned to draft. The tax election attached to that same entity is a decision a CPA is best positioned to model and recommend. Neither professional alone gives you the complete picture.
A Gulf Coast consulting firm brought on a new partner and handled the tax side entirely through its CPA, updating the entity’s tax filings to reflect the new ownership split. Nobody drafted an updated operating agreement to match. A year later, when the partners disagreed about a major business decision, there was no legal document defining how ownership actually worked, only a tax filing that reflected the split without addressing decision-making authority, exit terms, or what would happen if the partners could not agree. The tax side had been handled correctly. The legal side had never been addressed at all.
The same overlap shows up with business sales, mergers and acquisitions, and succession planning, where the deal’s legal structure and its tax consequences both matter and require specific expertise.
A Simple Way to Decide Who to Call First
If the question starts with how much or what will this cost me in taxes, start with your CPA. If the question starts with what does this agreement actually say or am I exposed here, start with an attorney. If the question touches both, forming or restructuring an entity, buying or selling a business, planning for succession, both professionals need to be in the conversation, ideally talking to each other rather than working from separate, disconnected instructions from the business owner.
Why the Disconnect Causes Problems
The most common failure point is not calling the wrong professional. It is calling the right professional for one half of a two-part decision and never looping in the other. A CPA who structures a tax-efficient entity election without a corresponding legal document creates the same kind of gap as an attorney who drafts a beautiful operating agreement without checking whether the tax election it assumes is actually in place.
A working relationship with both an attorney and a CPA who at least know of each other’s involvement, even if they are not formally coordinating on every matter, closes a gap that catches a lot of growing businesses by surprise.
Getting Both Sides Right
If you are not sure whether a current question needs a CPA, an attorney, or both, that uncertainty is common and worth sorting out before you decide based on only half the information. A Risk-Free Strategy Session is a good place to get a clear read on the legal side and identify where your CPA needs to be looped in.
Book your session at outsidechieflegal.com.
General information, not legal advice.
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Outside Chief Legal LLC is a modern, forward-thinking law firm serving as fractional chief legal officers and outside general counsel for businesses and their owners. With over 200 years of combined litigation, in-house, general counsel, and administrative legal experience, the firm delivers approachable, comprehensive counsel that blends legal expertise with practical business insight to help clients navigate ownership complexities with confidence. OCL is a trusted partner for founders, business owners, and leadership teams nationwide. Learn more about our firm, meet our team, or schedule a Risk-Free Strategy Session to talk with an attorney about how we can help your company.
