Doing Tax in Big Law

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Anonymous User
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Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 4:04 pm

Hi All,

I am going to be doing my SA at a large law firm in a major market. I had been planning on definitely doing regular corporate for the past year, but I have really enjoyed my tax classes this year. Is the lifestyle and hours any different for big law tax vs. big law corporate?

Also, if you don't have a business degree in undergrad, is an LLM necessary and if so, do large firms pay for it if you have already been hired? Thanks.

Anonymous User
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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 4:34 pm

Anonymous User wrote:Hi All,

I am going to be doing my SA at a large law firm in a major market. I had been planning on definitely doing regular corporate for the past year, but I have really enjoyed my tax classes this year. Is the lifestyle and hours any different for big law tax vs. big law corporate?

Also, if you don't have a business degree in undergrad, is an LLM necessary and if so, do large firms pay for it if you have already been hired? Thanks.

3L who did a lot of tax last summer at a NY V10

Hours were not necessarily better but they were different. A lot of the associates had way less billables than other corporate departments but that was because their hours in the office/time billed ratio was worse because of all of the CLE type obligations tax comes with. They still worked late but hours were more predictable in general, it was very rare for a tax fire drill to happen. There was a split between people thinking they had more leverage since none of the corporate people had any idea about tax and others thinking they were subordinate to corporate people who they thought were idiots. Exits are different than general corporate, you are less qualified for more generalist in house jobs, but the ones that do open potentially are more lucrative. Note that pretty much all firms regardless of whether their corporate departments are generalists or rotation based tend to run tax as its own thing and you have to be all in from the get go.

LLM definitely not necessary, nor is a business degree. Might be a steeper learning curve if business concepts and accounting is totally foreign to you, but you won't be alone there. My firm would pay for an LLM for anyone who wanted to do it part time but basically no one takes them up on it because it's seen as having little benefit and your job still has to come first which could destroy your QOL. If you look at the bios for most of the band 1 tax firms you will see that something like <20% of them have LLMs and those that do are often compensating for lower ranked law schools and used it to open new doors that are presumably already open to you if you have a SA lined up.

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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 4:50 pm

Anonymous User wrote:Exits are different than general corporate, you are less qualified for more generalist in house jobs, but the ones that do open potentially are more lucrative.

Care to elaborate?

Anonymous User
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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 4:55 pm

Anonymous User wrote:
Anonymous User wrote:Hi All,

I am going to be doing my SA at a large law firm in a major market. I had been planning on definitely doing regular corporate for the past year, but I have really enjoyed my tax classes this year. Is the lifestyle and hours any different for big law tax vs. big law corporate?

Also, if you don't have a business degree in undergrad, is an LLM necessary and if so, do large firms pay for it if you have already been hired? Thanks.

3L who did a lot of tax last summer at a NY V10

Hours were not necessarily better but they were different. A lot of the associates had way less billables than other corporate departments but that was because their hours in the office/time billed ratio was worse because of all of the CLE type obligations tax comes with. They still worked late but hours were more predictable in general, it was very rare for a tax fire drill to happen. There was a split between people thinking they had more leverage since none of the corporate people had any idea about tax and others thinking they were subordinate to corporate people who they thought were idiots. Exits are different than general corporate, you are less qualified for more generalist in house jobs, but the ones that do open potentially are more lucrative. Note that pretty much all firms regardless of whether their corporate departments are generalists or rotation based tend to run tax as its own thing and you have to be all in from the get go.

LLM definitely not necessary, nor is a business degree. Might be a steeper learning curve if business concepts and accounting is totally foreign to you, but you won't be alone there. My firm would pay for an LLM for anyone who wanted to do it part time but basically no one takes them up on it because it's seen as having little benefit and your job still has to come first which could destroy your QOL. If you look at the bios for most of the band 1 tax firms you will see that something like <20% of them have LLMs and those that do are often compensating for lower ranked law schools and used it to open new doors that are presumably already open to you if you have a SA lined up.


OP here. Thanks. Did you decide to do tax? Does your firm expect you to let them know at the end of the summer if you want to do tax? Thanks again

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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 4:56 pm

Anonymous User wrote:
Anonymous User wrote:Exits are different than general corporate, you are less qualified for more generalist in house jobs, but the ones that do open potentially are more lucrative.

Care to elaborate?


Tax people are not as qualified as a genernal corporate associates for generalist in-house jobs, and may have a tougher time landing one. However, when the less-common tax-oriented in-house jobs do open up, they pay more.

Edit: Accidental anon
Last edited by Anonymous User on Mon Mar 02, 2015 4:58 pm, edited 1 time in total.

Anonymous User
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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 4:57 pm

Anonymous User wrote:
Anonymous User wrote:Exits are different than general corporate, you are less qualified for more generalist in house jobs, but the ones that do open potentially are more lucrative.

Care to elaborate?

I'm the original Anon replier - I agree w/ the summary reply but to elaborate:

The big accounting firms have tax attorneys as do most banks, but if you are talking in-house at a company your skills are less transferable/in demand than someone who is coming in having done M&A/Credit. Most companies seem to have one to a few in house tax people though and those seem to command a higher salary scale than the general corporate in house attorney jobs that other corporate people exit to. Because there are fewer though they might be more competitive and there's less info than the already limited info about exiting to in-house.

Again this is coming from talking to associates at my firm, I haven't lived the process and would happily defer to someone who had.

To the OP - No I chose corporate - Couldn't say I was committed enough to tax to pull the trigger that early but it was a tough call.

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nealric
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Re: Doing Tax in Big Law

Postby nealric » Mon Mar 02, 2015 5:05 pm

Anonymous User wrote:Hi All,

I am going to be doing my SA at a large law firm in a major market. I had been planning on definitely doing regular corporate for the past year, but I have really enjoyed my tax classes this year. Is the lifestyle and hours any different for big law tax vs. big law corporate?

Also, if you don't have a business degree in undergrad, is an LLM necessary and if so, do large firms pay for it if you have already been hired? Thanks.


I did 3 years of biglaw tax (now in house tax).

Hours are more consistent than Corporate/Lit, but not necessarily any less. If you have a 250 hour month, it's because you are billing a consistent 10 hours a day for 25 work days, not because you bill 75 hours in the first two weeks and 175 hours in the second two weeks as can sometimes happen in corporate. The only super late nights I ever had (past midnight) were from taking on work from other departments.

I was a philosophy major with no tax background whatsoever, but I did a LLM right after my JD because firms were deferring start dates when I graduated. It was nice to come in knowing something, but plenty of people come in with very little background. However, if you plan on tax, take every tax course you can 3L year. After the intro classes, corporate I and II, partnerships, and international are the most important followed by tax accounting. My firm would pay for a part time LLM from NYU, but it's a grind that will take you 4-5 years. It's certainly a career plus, but not essential. The LLM was useful when getting my in-house job. I would note that regular business and accounting courses probably aren't that helpful. What is called "tax accounting" in LLM classes is really about timing of income, and is very different from financial accounting.

RE exit options. Good tax people are in strong demand, but it can take a long time to find the right match because employers are often looking for very specific skill sets. Most F500 companies have at least a handful of tax attorneys. Compensation can be all over the map, but will probably be at least somewhat competitive with biglaw with better quality of life. Some of the more finance intensive exit options can be bigger risk/bigger reward. Big4 generally isn't a good option unless you are a lateral partner (usually less pay for same quality of life). Government is more of a public service option rather than something that will benefit you personally. The current ethos at the IRS right now seems to be "the beatings will continue until morale improves."

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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 7:23 pm

Do in house opportunities become better if you are able to do exclusively transactional tax? Specifically in a public M&A context?

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Re: Doing Tax in Big Law

Postby Anonymous User » Mon Mar 02, 2015 11:47 pm

What are some typical assignments for a transactional tax associate as a first-year or as a summer?

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Re: Doing Tax in Big Law

Postby Anonymous User » Tue Mar 03, 2015 12:00 am

Anonymous User wrote:Do in house opportunities become better if you are able to do exclusively transactional tax? Specifically in a public M&A context?

This is what almost all tax work in major markets is. Well, not necessarily public M&A, that depends on what your firm's corporate department does, but M&A/Credit/Cap Markets stuff.

Few big firms to my knowledge have dedicated tax litigators.

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BizBro
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Re: Doing Tax in Big Law

Postby BizBro » Tue Mar 03, 2015 12:17 am

Does tax work feel like a combination of litigation (research,writing) and transactional work? If you go tax, it sounds like you're essentially tax for life as you can't be a generalist in house.

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nealric
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Re: Doing Tax in Big Law

Postby nealric » Tue Mar 03, 2015 9:41 am

Anonymous User wrote:Do in house opportunities become better if you are able to do exclusively transactional tax? Specifically in a public M&A context?


It's more about the skill set. They won't ding you because you do occasional controversy work. I did a touch of audit and appeals work before going in house and still do. Tax litigation is very different from administrative tax controversy. You don't really need to be a litigator to do the latter.

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nealric
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Re: Doing Tax in Big Law

Postby nealric » Tue Mar 03, 2015 9:44 am

BizBro wrote:Does tax work feel like a combination of litigation (research,writing) and transactional work? If you go tax, it sounds like you're essentially tax for life as you can't be a generalist in house.


Not necessarily true. One of our assistant general counsels (#2 and #3 attorneys at the company) started as tax attorneys as did one of our senior executives.

Generally speaking, I would say a good tax attorney can do corporate work just fine. You have to understand the deal to work on the tax issues.

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nealric
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Re: Doing Tax in Big Law

Postby nealric » Tue Mar 03, 2015 9:47 am

Anonymous User wrote:What are some typical assignments for a transactional tax associate as a first-year or as a summer?


Whatever we can think of. It's tends to be really hard to give assignments to summers because they usually have such limited background knowledge. I usually just had them write articles or had them help update a treatise my firm worked on.

Juniors mostly do tax diligence and general research assignments. If they are good, they will get to do first cuts of tax opinions, tax-related deal docs, private letter ruling requests, etc.

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Re: Doing Tax in Big Law

Postby Anonymous User » Tue Mar 03, 2015 11:15 am

Anonymous User wrote:What are some typical assignments for a transactional tax associate as a first-year or as a summer?


Incoming transactional tax associate so I can only speak to the summers:

1L - Most people won't have taken tax classes so you're just getting a feel for stuff. That includes using RIA Checkpoint, learning about the various types of authority in tax, etc. One research question was whether a type of income was "income from real property" for REIT purposes. Worked on a controversy project regarding income sourcing/foreign tax credits. Looked into whether transferred stock was subject to a "substantial risk of forefeiture."

2L - Much more deal oriented now that I had more tax knowlege. Take as many tax classes as you can. It's not that you'll walk in and drop some knowledge bomb on the partner. It's that it allows you to actually discuss the assignment with attorneys and demonstrate your interest in tax. My experience was that if I hadn't taken the classes, I would have been completely clueless and starting every research project from square one ("What is a partnership?").
Redlined a Stock Purchase Agreement and a Limited Partnership Agreement for a PE fund that were ongoing deals. Looked at various structures for tax-free reorganizations and then tactics for busting tax-free reorgs. Researched built-in loss issues with partnerships. Determined income sourcing of interest payments for hybrid and reverse-hybrid entities (organizations that are taxable entities in one jurisdiction but passthrough entities under the law of another jurisdiction).

Again, I'm only a 3L, but if you're interested in transactions, tax seems to be ideal. You learn about both the business side and tax side of deals. If you're actually interested in the law, it's a fascinating area to learn about. There are a lot of practitioners, academics, government officials, etc. who focus on tax so a lot is written about even minor issues and the law is constantly evolving. The hours also seemed to be smoother for tax as opposed to corporate.




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