Hogan, 70, who lives in LA with wife Linda Kozlowski, who co-starred in the croc trilogy, came home for his mother's funeral and found himself barred from leaving until he clears the matter up his lawyer told Australian Broadcasting Corp. radio.
"These may not be the appropriate circumstances to effectively make Paul a prisoner of Australia," Andrew Robinson said.
When Hogan arrived last week in Sydney for the funeral of his mother Florence, he was served with a bill for taxes on $34 million in unreported income. The order was "absolutely devastating" for Kozlowski and their 12-year-old son Chance, both of whom remained in Los Angeles, Robinson said.
"The process of detaining Paul in Australia away from his wife and child in Los Angeles has devastated him and he hopes that discussions between us and the ATO will lead to a prompt resolution allowing him to return to his family," Robinson said. "Paul believes that this exercise is a manifestly unfair attempt to gain leverage by the ATO."
Australian authorities say Hogan used offshore bank accounts to conceal earnings since his low-budget "Crocodile Dundee" movie became an international hit in 1986.
Hogan has denied any wrongdoing and disputes the tax bill. He has never been charged with tax evasion.