As the demand for delinquent income tax solutions grows, so will the supply of illegitimate tax mill scams. Many firms will promise to solve any kind of IRS trouble with an offer in compromise (OIC). However, that’s not the answer to every income tax problem. Maryland tax attorney Jeffrey Rogyom recently provided a very informative list of ten surefire signs that a tax settlement company is unethical. Following is my summary.
1. Disinterest In the Facts
Unethical tax mills aren’t interested in the facts of your situation. They want your upfront payment. They could care less whether or not you actually have a chance of settling your debt with the IRS. They certainly aren’t going to let you know if your case can be simply resolved by submitting a few key documents.
2. Big Promises
The only guarantees in life are death and taxes. It’s not death and ‘resolving your tax issues amicably with IRS’. Beware of any company that promises the world. Acceptance of an OIC is not a guaranteed outcome.
3. Overadvertising
Think about it. Do you really want to get professional tax advice from a firm that advertises on television or radio? If you find a company you like via mass media, just make sure you ask around to make sure they on the up-and-up before plunking down your payment.
4. Promises of Quick Resolution
Here’s the thing – the IRS is a slow moving beast. Anyone who claims to have the ability to fast track your resolution is probably full of it.
5. High Turnover
You have enough to worry about with the IRS breathing down your neck. The last thing you want is to deal with a new customer representative every other week. If the person you’re dealing with doesn’t know the details of your case, move on.
6. The Deposit is Based on Your Net Worth
While most tax attorneys are going to want some money up front to take on your case, you should be skeptical if the company asks for a deposit that is eerily similar to the amount you disclose is in your bank account. The deposit should be based on an estimate of how much your case will initially cost.
7. No Physical Location
You’re better off using a tax relief company that has a local presence. Make sure the address they give you is for an actual office and not just a shared conference room.
8. Unresponsiveness
Once they got your deposit did they stop answering the phone? Your initial payment may be a sunk cost, but don’t keep paying for poor service.
9. Complaints
The internet is a wonderful thing. Google to your heart’s desire and chances are you’ll find plenty of opinions on a scam company.
10. Listen to Your Gut
Don’t be afraid to start over. You know if something’s not quite right. You probably knew it the first time you stepped into their offices or spoke with someone on the phone. But you were desperate. It’s never too late to trust your instincts and move on from a scam tax mill.
For the full story, check out Rogyom’s post here.
