The Republican tax bill, ever closer to becoming law, has been flooding tax attorneys with work as they scramble to understand how the proposals might impact their corporate clients.

The first major tax reform in three decades is all but the law of the land, as both the House and Senate have voted to approve it after last-minute details were hashed out this week.

But tax attorneys have already been hard at work ever since the bill started down the fast track in Congress, according to corporate tax lawyer David Miller, a partner at Proskauer Rose in New York. Miller advises clients from major industries—such as banking, health care, real estate and technology—about domestic and international tax issues involving financial transactions, mergers and acquisitions, and more. He’s also taught tax law at New York University School of Law and Columbia Law School, and served as chairman of the New York State Bar Association’s tax section.

We asked Miller about how the tax bill has already impacted his work life, and the legal business that tax lawyers expect to see once Congress passes the new law. Here are his answers, edited for brevity and clarity.

 

Since the tax bill first began winding its way through Congress, what changes or differences has it brought to your daily work life?

Much of my time is now spent tracking the bills, explaining them to clients, and helping clients work through strategies for after the tax act passes. As much as a third of my time is now spent on tax reform. It would be more, except that the end of the year is the busiest time as clients close transactions before the new year.

 

On a scale of one to five, with five being the busiest, what’s your prediction for your practice next year?

For me and tax lawyers generally, definitely a five. The tax bill represents the most significant change in the federal tax laws in the last 30 years, and businesses will seek advice on how to restructure to take advantage of the new regime, and help implement the changes.

 

I wonder about the emotional mood or feeling of clients about the tax bill. What moods have you noticed, if any, and how are you handling it?

The mood of clients varies depending on their circumstances. As with any tax bill, there are potential winners and losers. The clients who would be adversely affected by the bills and have access to lobbyists are focused on changing the bills. Other clients are elated by the proposals. Some are angry. Many are just exhausted.

 

You say some industries are winners, others losers. What about the legal industry? How would the tax bill impact law firms and lawyers themselves?

David Miller

Virtually all New York City big law firm partners and many associates will pay meaningfully more in taxes, principally because New York state and city taxes are not deductible. On the other hand, the new tax act will dramatically increase the need for corporate, transactional, tax, and trust and estate lawyers as businesses restructure and adjust to the new tax act, and high-net-worth individuals adjust their personal planning and wills to the new estate tax thresholds. On whole, lawyers will be winners. It remains to be seen whether lawyers will change their business structures in response to the new tax act, and partners in law firms will form professional corporations to benefit from lower corporate rates.

 

As I understand it, the last major tax reform happened in 1986. How has this reform process been different?

The biggest difference between the 1986 act and the current tax bills is that the 1986 act was preceded by two years of detailed proposals; the tax policies behind the 1986 proposals were relatively clear; the tax community had the opportunity to comment on the proposals; and Congress was responsive to the comments. The current bills have been drafted in a matter of months; there is no evident tax policy underlying some of the proposals; and Congress has not asked for comments or been responsive to them. As a result of these differences, the current bills will give rise to unexpected consequences—some of which taxpayers will exploit and others of which will create unintended tax liability.

 

How are tax lawyers reacting to such big changes for the first time in three decades?

Given the rapid pace of the legislative process and its monumental potential effect, practitioners are trying to understand the proposals, advise their clients on adverse provisions—so that clients can contact lobbyists—and on opportunities that may exist before the legislation is passed, and finally, to begin to think about longer-term strategies that may arise as a result of the legislation.

 

Once the final version of the bill passes Congress, what legal work do you see in the future for tax attorneys?

There will be a great deal of work over several years once the president signs the final version. Many of our clients will change their structure or operations in response to the legislation, and the planning for those changes and their implementation will take a great deal of time. It’s really the best time to be a young tax lawyer.

 

Wow! Why do you say it’s the best time for a young tax attorney?

First, the new law will create tremendous demand for a young lawyer’s services, and it’s always nice to be appreciated. Second, although I’ve practiced for more than 25 years, I know no more about the new tax law than a first-year associate who has been following it closely. In an instant, they can catch up to my career’s worth of knowledge.

 

Angela Morris is a freelance reporter. Follow her on Twitter: @AMorrisReports.