Tips For Taxpayers With IRS Debt

: Chris Lee Law Firm

  Filed under: Taxes

Tax Debt

If you are one of the many Americans faced with owing the IRS this tax season, you may be wondering exactly what your options are. There are numerous companies that assist consumers in repaying their tax debts. Just as the case is with some poor credit counseling agencies, consumers need to watch out for tax debt relief companies that promise too much and fail to deliver. There has been an increase in “tax mills”, which misrepresent themselves and turn a profit for themselves leaving the consumer with no relief of their debt.

You hear advertisements on the radio for companies that can make your tax debt disappear or help you settle your debt for “pennies on the dollar”. Consumers should be wary of any company that makes promises that appear too good to be true. Often consumers find themselves paying large fees for these services and never receive anything in writing about the debt they are working to pay off.  The risks associated with unqualified tax debt relief companies can leave the consumer facing wage garnishments and federal tax liens. The Federal Trade Commission (FTC) warns consumers to be informed and ask questions of the company you consider hiring to help you settle your IRS tax debt.

Proceed With Caution

Sales Tactics. A qualified tax debt relief company will not pressure you into using their services. Their services are already in demand and any effort to treat a consumer as if they are the only one getting a “good deal”, should send up a red flag.

Large Service Fees. Companies that require you to pay large amounts of upfront fees may not be looking out for the best interest of the consumer. Many companies will insist that payments be paid with a credit card or direct debt from a checking account.  Protect your personal information and do not provide your bank account and routing number to a company performing a onetime service.

Guaranteed Results. Be wary of any companies that says they can guarantee complete tax debt relief. Only the IRS can determine eligibility for, and approve, programs for individuals who cannot pay. Don’t follow through with a plan unless you are sure it is backed by the IRS.

Poor Credentials. When looking for a reputable company to help you with tax debt relief, make sure their staff holds the appropriate credentials. Reputable tax debt relief agencies will staff Board Certified Tax Attorneys, C.P.A., and individuals that previously worked for the IRS Collection Division. It is also important to check the companies rating with the Better Business Bureau.

Remember that there are no easy solutions to repaying debt of any kind. Any shortcut may be a signal you are not receiving a legitimate service. Be sure to get everything in writing and ask plenty of questions.


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