There are only two things we can’t avoid in life: death and taxes. And many of us fear the second one much more than the first! If you’ve ever found yourself in a hole to the IRS, behind on your taxes (owing back taxes), or owing more taxes than you believe you should, you may need a tax relief service to help you negotiate and pay off the IRS. A tax relief service usually has accountants and attorneys who deal with the IRS and its intricate tax code on a daily basis. They understand the loopholes, the contradictory nature of some of the tax regulations, and the negotiation methods that us normal citizens don’t deal with frequently. Being on the wrong side of the IRS can be a scary place – but a tax help service can assist us and be the David on our side to the Goliath we’re facing down in battle.
Like any professional service, and especially when dealing with a government organization that has the power to garnish your wages, or even put you in prison, you should research and review all of the options before selecting a tax relief service. A good tax attorney may be able to help you as much as a professional tax relief organization, but at the hourly rate of some of the best ones, you’re better off just paying the IRS what they think you owe. A tax relief service is usually a more reasonable cost and something you will be able to come out ahead if they negotiate a fair settlement with the IRS. There are secrets to finding a good tax relief service, find them here in this free tax tutorial.
7 Secrets to Finding a Good Tax Relief Professional
There are steps you can take to find a good tax relief attorney or service. There are thousands of organizations out there that will make big promises for tax relief to gain your trust, but many of their claims are simply untrue. These 7 secrets are guidelines you can use to vet potential tax debt settlement firms and find the right one for your specific situation.
1. Research the Firm Through the Better Business Bureau
The Better Business Bureau (BBB) assigns a grade from A to F for businesses. You can research specific tax resolution companies by calling the BBB and finding out the letter grade and if the company has any outstanding complaints. Don’t use a service which isn’t a BBB member.
2. Ask Who Owns the Tax Relief Firm
Find out who the owners of the firm are. If a company is shady, they likely won’t release this information or will provide an answer which smells fishy. If a company isn’t willing to identify who owns it, stay away. Once you find out the owners, do a simple Google search to find out more before you proceed. Some tax resolution firms simply operate under numerous names, or change their names frequently, to avoid a history of bad customer complaints.
3. Ask How Many Tax Attorneys the Firm Has on Staff
A high quality tax relief firm should have tax professionals on staff. Ask about how many bar approved tax attorneys the firm has on staff. Inquire about the number of CPAs (Certified Public Accountants) the firm employs. Ask about how many IRS enrolled agents work for the firm. These are all indication as to whether or not the firm is simply looking for fees or will really help you negotiate down your back taxes.
4. Select a Company with a Flat Fee
There are usually two types of agreements in this industry: retainer and flat fee. A retainer is a contractual agreement between you and the firm which may require you to continue paying for services, even if the firm isn’t really helping you. A flat fee has a cap so you pay one cost for the service. If you decide to select a tax attorney to handle this matter for you, they will likely charge a retainer fee and an hourly bill rate. This advice only applies to tax relief and settlement firms, not necessarily a qualified tax attorney.
5. Avoid Pennies on the Dollar Firms
The IRS isn’t in the business of giving away concessions. They rarely want to negotiate down any tax debt and will usually do so only in extraordinary circumstances. There are quite a few tax relief companies promising a pennies on the dollar settlement offer – that the IRS is willing to settle your tax debt for pennies on the dollar – a very small portion of what you actually owe. This simple is not true in the vast majority of cases and any firm offering that in their advertising is not being truthful with you.
6. As What the Average Settlement Is
Every situation is different, but ask the question: over the past five years, what the is the average percentage discount negotiated for all of your customers? In other words, what is the likely outcome for your tax case? What is the average dollar amount in savings per customer? Many firms are unwilling to share this data, well, simply because its bad.
7. Avoid High Pressure Sales
Many tax relief firms will put a lot of pressure on you over the phone to buy their service immediately. Don’t ever sign up for the service on the first call – find out how they work their sales process before you commit. If you have a bad feeling in the initial sales calls, you probably won’t have a good outcome with the firm. If a company asks for credit card or bank account information on the first call, avoid them – it is likely a scam.
There are a couple of indicators you should look for in a firm:
- Length of time in the industry. Look for firms with 10+ years of experience in the tax relief industry. These companies will have stood the test of time and should have enough customer history for you to find out any complaints the firm has outstanding.
- Free consultation for your specific situation. Every tax situation is different. A firm willing to offer you a free consultation before engaging with services will let you understand whether or not you should consider tax relief.
The IRS is difficult to deal with. They do not like to negotiate down tax debt and negotiating with them yourself is often difficult. Engaging with a tax settlement firm can be a good idea if its a high quality firm with a lot of experience dealing with the IRS and with people in your situation.