If the IRS has placed a lien on you, you have most likely been inundated with mailings from purported tax professionals promising that they can get the IRS to accept in complete settlement just a fraction of what they say you owe.
I have written extensively about the con-men and con-women who disguise themselves as tax professionals and attempt to convince taxpayers that they can get their tax debts settled for a fraction of what they owe.
Don’t believe it.
See my blog posts, “Pennies on the Dollar? . . . Buyer Beware and J.K. Harris Settles Fraud Charges with 18 States! for what to watch out for when being solicited by tax resolution companies.
Snake Oil Salesman and the Ninth Circle
Unfortunately for you and thousands of other Americans, these snake-oil salesmen understand human nature better than they do the tax laws. They know that people who are frightened and vulnerable will often latch on to any thread of hope no matter how preposterous or false it is.
Didn’t Dante relegate these predators to the ninth circle?
What you Need to Hear, Not What you Want to Hear
In difficult times you need to hear the truth more than ever because your financial and psychological well-being depend on getting accurate information and wisely and swiftly acting on it.
And with respect to IRS Settlements, the truth is that the great majority of delinquent taxpayers will not qualify for an Offer in Compromise.
And if you do file an Offer that is returned or rejected, you will have only made matters worse:
First, you will have incurred additional interest accumulations making it more difficult to get favorable terms with an IRS Installment Agreement;
Second, the statute of limitations on collection will have been extended for at least one year.
And, finally, you will be out the preciously needed funds you paid to the con man or woman to prepare and your file your offer.
A Detailed Analysis Must be Done Before Recommending the Filing of an Offer
A competent, diligent and ethical tax professional will want to conduct a detailed examination of your assets, liabilities, income and expenses before giving you an opinion as to whether or not it is likely that the IRS will accept a lesser amount than what you owe.
Anyone who tells you they can achieve this result without first asking you for this information is either incompetent, insane or iniquitous.
5 responses so far ↓
1 The 5 Most Frequently Asked Tax Questions // Apr 8, 2009 at 7:31 am
[...] is nonsense and we have written in more detail about it here, here and [...]
2 Taxmasters, Inc. (Chubby Red-Bearded Guy on T.V.) Sued for Deceptive Trade Practices // May 15, 2010 at 8:59 am
[...] [...]
3 tax truth // Jun 8, 2010 at 1:08 pm
http://taxresolutionincolorado.blogspot.com/2010/05/blowing-whistle-on-colorado-tax.html
For the inside scoop on these companies.
4 Rose // Oct 18, 2011 at 8:17 pm
I am a shareholder of a S Corp and just filed chapter 7 bankruptcy with my husband. All credit card debt incurred by the corporation were under my husband’s name but was used for business expenses that were deducted from income by the corporation. Along with this debt, there are loans borrowed from personal friends and payroll taxes owed. My bankrupcty attorney said don’t worry the corporation will just disappear??? What does that mean? What happen to the debt? All credit cards were included and discharged in the bankruptcy. Does the corporation incure income from the cancellation of debt or non-payment of the other debts? If it passes to us (the shareholders) do we qualify for the cancellation of debt exclusion on form 982? Please we need guidance here. We were under the impression that we had to file with State of California to dissolve the corporation but I don’t think payroll taxes can be forgiven and not paid?! Thank you for clarifying this mass to us.
5 Peter // Oct 19, 2011 at 7:53 am
Rose,
These are complex questions and I would need a lot more information before even attempting to answer them. I suggest you ask your bankruptcy attorney for an in-person meeting and ask him these questions. Don’t leave the meeting until you get your answers. You paid him and are entitled to know.
Good luck.
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