What's the Deal With Those Tax Relief Services?


If you watch bad TV late at night you’ve seen these ads.  They usually follow a pattern: The scene opens with a stressed-out ordinary taxpayer, a regular honest citizen like you or me.  You can tell they’re stressed: hair is a mess, sitting at a kitchen table with a big stack of bills, busily not sleeping.  Cue the scary music at the mention of the IRS, the faceless monster stalking their dreams, threatening their family.  But wait… is that a soaring bald eagle?  A waving American flag?  It’s a tax relief company, here to fight for YOU!  Can they help reduce, or perhaps even eliminate your debt to the IRS?  Practically definitely!  Calling the toll-free number on your screen would be downright patriotic.  How could that decision possibly go wrong?


The Federal Trade Commission (FTC) urges caution if you owe taxes and are approached by one of these companies.  Here are some tactics these services often employ:
  • Claiming a taxpayer qualifies for special programs that don’t apply.
  • Insisting on large up-front payments before submitting any paperwork. 
  • The “paperwork” is often never submitted at all, or it’s something you could submit on your own.  
  • Some companies have been known to make unauthorized credit card charges or bank account withdrawals from their customers. 

Read the full FTC article here 

The article cites several basic programs that you can request from the IRS on your own, including (1) installment agreements, (2) offer in compromise, and (3) penalty and interest abatements.  You don’t need to hire a third party to submit these requests.  The IRS Taxpayer Advocate Service also provides useful guidance at this site: taxpayeradvocate.irs.gov/

While it isn’t necessary to hire someone, tax law can be incredibly complex.  Many taxpayers need professional advice.  Late-night advertisements take advantage of desperation by promising much and delivering little.  If you need help, the better choice is to consult a local CPA or tax attorney.  Bankruptcy attorneys may have a role to play too, if you
aren’t able to pay tax debt and facing a lien or other collection action.  The timing of a bankruptcy filing can have important consequences.  If you have unfiled tax returns, it’s critical that you bring that to the attention of an attorney before you file a bankruptcy case. 

Whenever you seek professional advice, choose someone you are comfortable with, who has the right professional qualifications and experience to handle your problem.  Get a clear written agreement explaining the services the professional will perform for you, and how much and when you will pay for those services. 

The7thirteen is a blog written by Jeff Narmore, focusing on consumer bankruptcy issues.  Visit my website at narmorelawoffice.com. 

Narmore Law Office LLC is a debt relief agency that helps people file for relief under the Bankruptcy Code.   

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