If you’re having a tax issue and you’ve filled out an online application looking for help, be careful! Some of the companies that you speak with can end up doing more harm than good. Here are some big warnings, from some big names:
“Taxpayers should beware of promoters' claims that tax debts can be settled for "Pennies on the Dollar" through the Offer in Compromise program. ‘We urge taxpayers not to be duped by high-priced promises.’”
- IRS Commissioner Mark W. Everson.
Don't give your credit card number or bank information over the phone unless you know the company. One easy way for a scam operator to close a deal is to get your credit card number and charge your account. Sometimes fraudulent telemarketers say they need the number for verification purposes only. Don't believe them.
– Federal Trade Commission (FTC)
Some so-called "tax relief" or "tax settlement" firms claim they can step in and petition the IRS to remove penalties and interest from your tax debt. Be careful… …you want to ensure that the company is honest about what it can deliver.
-Dallas Morning News
Here are my Top 5 Alerts when looking for Tax Help:
1.Beware of any company that has a “Retainer Fee” or “Retainer Agreement.” Retainer means they can charge you more fees later…and if they can get more of your money…they will.
2. Watch out for companies that don’t have a refund policy. You want a company that can stand behind their work; if they don’t offer a refund; ask “Why Not?”
3.Look out for hidden fees. Convenience fees are a big red flag! These companies will tell you one price and when you get their contract, you’ll read a higher price. It’s a perfect example of the “Bait and Switch” scam.
4.Make sure the information you are being told is correct; especially on Offer in Compromise Programs. Remember that with an OIC, 83% of cases are rejected by the IRS. A lump sum down payment is required, and you must make a five-year agreement to join the program.
5.Make sure the company has at least a three-day rescission or “opt-out” on their contract. Fast talking companies just want your money; they don’t want you to get out of their contract.
Now you have the smoking gun...Use it!
Labels: Offer in Compromise