Three kinds of professional can stand in for you at the IRS
Treasury Circular 230, the regulation governing who may practice before the IRS, allows three main categories to represent a taxpayer: attorneys, certified public accountants, and enrolled agents, each in good standing and not currently suspended or disbarred from IRS practice. Any of the three can sign a Form 2848, Power of Attorney and Declaration of Representative, and step into an audit, an appeals case, or a collections matter on your behalf. Preparing a return, on its own, is not considered practice before the IRS under Circular 230; representation is a separate authorization.
For a straightforward case, that parity is real. A CPA who has handled your books for years, knows your business, and already holds your financial records is often the fastest, most cost-effective person to negotiate a routine installment agreement or respond to a correspondence audit. The gap between the three credential types shows up somewhere else entirely: what happens to what you tell them if the case turns criminal.
What a CPA's privilege covers, and where it stops
Congress created a limited accountant-client privilege under Internal Revenue Code Section 7525, extending something like attorney-client protection to tax advice a CPA or enrolled agent gives a client. It is real, but it is narrower than most people assume in three specific ways. It applies only to noncriminal matters before the IRS and to certain noncriminal tax proceedings in federal court. It does not extend to state tax matters, including a California Franchise Tax Board or CDTFA audit. And it does not cover communications made for the purpose of preparing a tax return, since return preparation is treated as an accounting function, not legal advice.
The gap that matters most is the criminal exception. The moment a civil audit develops facts that look like fraud, whatever privilege protected your conversations with your CPA disappears for that matter. Everything you told your accountant to help them prepare an accurate return, including the mistakes you disclosed so they could be corrected, becomes something the IRS can potentially compel your accountant to testify about.
Why an attorney's privilege doesn't have that carve-out
Attorney-client privilege is common-law, not a statutory grant with built-in exceptions for the situations where you need it most. It covers communications made for the purpose of getting legal advice, in civil and criminal matters alike, and it existed long before Section 7525 gave accountants their narrower version. That is the practical reason a tax attorney, not a CPA, is the right first call the moment a case has any real exposure beyond a disputed number on a return.
Bringing your CPA inside privilege: the Kovel option
None of this means switching away from a CPA you trust. In United States v. Kovel, a 1961 Second Circuit case, the court held that privilege can extend to a non-lawyer an attorney retains to help the attorney understand a client's finances and render legal advice. In practice, that means an attorney can hire your existing CPA as part of the legal team, under what's commonly called a Kovel arrangement, so the accountant's analysis is done under the attorney's privilege rather than the accountant's own, narrower one. Done correctly, you keep the CPA relationship and the deeper protection at the same time.
Signs a Bakersfield case needs an attorney, not just a CPA
A few specific situations are the ones we tell Kern County clients to treat as a clear signal: a Revenue Officer or an IRS Criminal Investigation agent making direct contact, several years of unfiled returns that involve unreported cash income, a CPA telling you they can no longer advise you because representing you would create a conflict, or any matter where the facts needed to fix a tax problem could also support a fraud allegation. Kern County's oilfield services and agriculture economy runs on a mix of 1099 contractors, cash-paid seasonal labor, and businesses with genuinely complicated books, and those are exactly the fact patterns where a routine-looking balance can carry more exposure than it first appears to. We touched on a related version of this in our piece on how a large equipment write-off can set up next year's IRS balance for an oilfield or ag business; the write-off itself is rarely the problem, but how the resulting numbers get explained to the IRS can be.
None of that means every audit notice needs an attorney. A correspondence audit over a documentation gap, a missed estimated payment, or a first-time penalty is still squarely CPA and enrolled agent territory, and bringing in a lawyer for a case like that adds cost without adding protection you need. The line is whether the underlying facts, honestly disclosed, could expose you to more than an adjusted bill.
Handle it with your CPA, or bring in a tax attorney first
If you are unsure which side of that line your case sits on, that question itself is worth a conversation before you disclose anything further to anyone. We regularly take an initial look at a Bakersfield case, including ones where a CPA is already involved, specifically to flag whether privilege matters here before more facts get put on paper. Where it doesn't, your CPA can usually keep running the case. Where it does, the Form 2848 and the privilege question are both fast to resolve once a Kovel arrangement, or a direct attorney engagement, is in place.