Tax Resolution Services Company Complaints
We’ve had a lot of requests from readers to list out the most common complaints taxpayers have with tax resolution companies. If you’ve ever looked at a company’s record on the BBB, you’ll see that the BBB provides a history of customer complaints sorted by categories (billing/collection issues, problems with product/service, advertising/sales issues, delivery issues, and guarantee/warranty issues). What the Better Business Bureau DOES NOT provide is detail on the specific details of a complaint once it is closed, which leaves a lot to the imagination for customers doing their due diligence before hiring a tax resolution service. We put together the top complaints for you:
1. The company promised results that were simply not possible: “Settle for Pennies on the Dollar”
Reality: Only about 25% of Offers In Compromise are eventually accepted by the IRS
2. The company guaranteed an “Instant” release of garnishments: “24 Hour Wage Garnishment Release”
Reality: Tax Levies cannot always be released immediately and may require negotiation on additional terms to get a release
3. They billed me but didn’t save me any money: “Lowest Cost Tax Resolution”
Reality: Tax resolution is a time-consuming process, but a reputable company will explain your options and then recommend ONLY the services that you really need to keep your costs down
4. The person I was talking to said they were authorized to negotiate with the IRS: “Free Consultation with a Tax Expert”
Reality: Most companies employ sales people – not Federally Authorized Representatives – to do consultations
5. They charged me an upfront fee or retainer before letting me work with a representative: “Get Started for Just $500″
Reality: Some companies that require you to pay a retainer before ever talking to the authorized rep will become non-responsive or less helpful after you pay the initial deposit
6. They billed me more than they initially quoted me: “Your Estimated Quote is…”
Reality: Bad companies will use your financial information to tack on additional fees if they think they can get away with it – charging more money to people who can afford it even if it takes the same amount of work as a case they typically charge less for
7. The company said I would be represented by the company’s brand name: “Certified Representation to the IRS”
Reality: ONLY an individual can be authorized on an IRS Power Of Attorney form, not a company
You should be advised that there have been tens of millions of dollars paid by victims to tax services resolution companies in the last few years. There’s the announcement from the Federal Trade Commission, 10-06-2010 regarding one nation-wide company that allegedly bilked consumers of more than $60 million. The Attorney General for California filed a $34 million lawsuit against a former attorney in the Sacramento CA area – see the press release from April 20,2011.
The Attorney General for Texas charged several related companies “with materially misrepresenting their ability to help Texans resolve their unpaid tax obligations.” The press release 04-13-2009 also states that the BBB and the Office of the Attorney General had received approximately 1,000 complaints against the company in the past 36 months. A subsequent press release on April 05, 2011 stated that the Texas AG received a $1.2 million judgment against the “South Carolina –based tax consulting firm” from the court.
To help others avoid issues and future complaints, please share your tax resolution services company complaints in our comments section!