Unfortunately, the industry is plagued by scams and bad business practices. Disreputable companies lure customers with false promises while charging high fees. Still, legitimate tax settlement firms exist. These companies are honest about whether you can benefit from their services and charge reasonable rates that are disclosed in advance.
The answer to this question really depends on the company you use for your tax debt relief service. Yes, there are legitimate tax relief companies that can help you reduce your tax debt or sign up for an affordable repayment plan. However, there are also a lot of fraudulent companies. Do some research before choosing a tax debt relief company that represents you.
Yes, legitimate tax professionals can help you reduce your tax debt or sign up for an affordable payment plan. However, there are companies that will simply keep their money without adding much value. Fortunately, since what the IRS (and any other tax enforcement agency) really wants is what is owed to the government, there are ways out of the tax debt problem. Despite its intimidating reputation, the IRS does not intend to punish out of spite.
In addition, since it knows that it can only raise money if the money actually exists, the agency has payment options for taxpayers in difficult situations. There are legitimate tax debt relief companies with qualified, licensed, and experienced professionals who want to help you. They'll meet with you, review your financial data, and then provide you with a realistic assessment of what they can do. These legitimate companies will charge a reasonable fixed fee for their services.
Basically, CNC's status recognizes that someone is in a desperate financial situation and cannot pay the taxes due. With installment agreements and compromising offers, the IRS's Fresh Start initiative was already attracting struggling taxpayers to comply with the rules, but the expanded program is even more friendly, making it easier than ever to qualify for installment programs or commitment offer agreements. Also, check if a default billing rate (a flat rate) applies to the work of all employees of a company, not just tax professionals, if you cancel the company's services. Taxpayers who signed a contract with one or another tax debt relief company (and paid thousands of dollars in advance) complained to the Federal Trade Commission about unauthorized charges on their credit cards or withdrawals from their bank accounts.
For such a reduction to be approved, taxpayers must demonstrate that the total amount owed is incorrect, that the probability of being able to pay the full amount is very low, or that paying the full amount will result in enormous financial difficulties. Any reputable tax relief company will first obtain key financial data from its clients before giving them a realistic assessment of what they can do for a reasonable fixed fee. Tax relief companies can help taxpayers determine what programs they qualify for and help with the application and negotiation process. If you are the victim of a tax debt relief scam, file a complaint with the Alaska Attorney General's Office.
The way they reduce your debt is by negotiating with the IRS and helping you qualify for the best program for your circumstances. If a tax debt assistance company doesn't take a thorough look at your financial history first, it may not be able to help you. You can avoid IRS collection notifications and actions, such as a notice of a federal tax lien or an IRS tax, by establishing an installment agreement in advance and making your payments in installments. According to a study conducted by the Taxpayer Defense Service, the IRS collects twice as much in delinquent accounts in the first year than in the second year; and three times more in the first year than in the third year.
Some companies try to defraud taxpayers by promising them that they can make the tax debt disappear, while misrepresenting how long the process takes to reduce or eliminate tax debts. The IRS notes that it can forgive part of the tax debt through a transaction offer, but there are rigid requirements for this agreement. . .