I know I sound like a broken record (remember those). People, stop doing business with Tax firms that advertise on and radio. Love the fact that the State AG’s are doing their jobs and shutting down these companies.
Do your research, BBB, in business for less than four years-kick them to the curb and hire someone else. Read our tax relief Do’s and Don’ts.

JK Harris has filed for Bankruptcy, the sad thing is that there are thousands of ex-clients who hired them to help with their tax problems that are being hurt one more time by them. It is rumored that another HUGE (turn his face head shot) TV Tax ad company is purchasing the company and will be contacting the ex-JK Harris clients with NEW promises and NEW charges.

The bad news is that about 30 new Tax TV ad companies have sprung up from the ashes of JK and will start their own rip-off campaigns. The same thing happened when the Tax Lady bit the dust.

Attached article below-reporter is justifiably indignant, but perhaps a bit naive about tax problems and what people need when their paycheck or bank account has be levied, or wife/husband just walked out the door because of tax problems. Yes, the IRS has systems in place, but don’t ignore what their primary function is-collect taxes to pay for the running of our country. Many people can solve their tax problems, other’s prefer to hire a firm. It isn’t the fault of the client that JK closed and didn’t do what they were hired for, is ONLY the fault of the firm that ripped them off.

What is the next big TV Tax firm to go under? State Attorney Generals see suing these dirt bags as income source and it makes for nice press during an election year. Best of all it is the right thing to do.

For almost 10 years-We have been telling people with tax problems the same thing-Read our Tax Do’s and Don’ts.

JK Harris to file bankruptcy – Shutdown fueled by taxpayer complaints
By Jay Petrillo
Examiner.com
January 6, 2012
Visitors to jkharris.com are being greeted by the following message from John K. Harris, CEO:
I would like to let our clients and prospective clients know that we are working as fast as possible to get through this new GM/Chrysler style reorganization process. The court has responded to every request in an expedited manner and we anticipate announcing the approval of a sale motion in the next week or so.
JK Harris, one of the nation’s largest tax representation firms, suspended all active operations Thursday in front of a potential Chapter 11 bankruptcy filing.
A report from CBS Affiliate WCSC Channel 5 out Charleston, SC, gives a testimonial that is widely reflected in multiple consumer complaints about the tax representation giant.
Customer Patricia Ballman said she drove to the Goose Creek location searching for answers from corporate headquarters. The Texas resident was surprised to see workers pushing out desk chairs.
. “I think they are scurrilous, I think they are thieves,” said Ballman.
Ballman said she hired the company three years ago to help with a tax crisis.
“They never intended to do anything for me. The contract was written erroneously. It was based on resolving state tax issues. We don’t have state taxes in Texas. I wanted my money back,” said Ballman.
Since October, John K. Harris had been attempting to restructure and possibly sell the business and two affiliates under Chapter 11 bankruptcy protection.
“This is truly the most devastating event I have been forced to deal with in my 58 years on this earth,” Harris said in an email to all employees. “I am not sure it will reach that level for all of you, but I know that for some of you it will be as personally devastating for you as it is for me.”
Perhaps not as devastating as the 5,000 taxpayers who have brought on JK Harris in an attempt to settle their tax debts with the IRS. Consumeraffairs.com lists hundreds of grievances against the firm, the majority of those citing bloated fees and little to no help in return.
JK Harris led the way in robust advertisement that it could resolve tax debts for “pennies on the dollar,” a popular catch-phrase that refers to an IRS Offer in Compromise – A program designed for taxpayers to do themselves.
The nationwide firm has dogged by cash-flow problems and the cost of large settlements related to multiple claims that it misled consumers. In case after case, attorneys general complained that the company told consumers it could resolve their tax problems, and took their payments, when no such relief was possible for those particular clients.
The company sought bankruptcy protection to head off an attempt by the Texas attorney general’s office, related to such consumer claims, to force the company into receivership.
This is by far the first time JK Harris has been targeted for a failure to deliver. In 2007, a $6 million class action lawsuit was driven by consumer complaints about JK Harris’ heavily advertised tax-resolution coupled with a negligence in their part to actually assist taxpayers.
The next step for JK Harris & Co. is expected to be a Jan. 10 bankruptcy court hearing, where the company will ask a judge to appoint a trustee.
The next step for JK Harris & Co. is expected to be a Jan. 10 bankruptcy court hearing, where the company will ask a judge to appoint a trustee.
The IRS has always encouraged taxpayers to contact them directly. There are no options available to any third-party tax resolution firms that are not available to a taxpayer directly.

We became aware of this problem today for Roni Deutch when a client of hers (crying on the phone after their bank account was levied) couldn’t reach anyone at her office this week. The client would call and be told “no one was in the office”, this client paid over $4,000 over a 16-month period, a quick review of the facts and it is pretty clear this client is an installment agreement.

http://www.sacbee.com/2011/04/20/3568022/state-ag-says-tax-lady-roni-deutch.html

Please, please don’t if you have tax problems, DON”T hire firms that advertise heavily on TV, Radio, et. The likelihood of getting positive result is slim. Due your due diligence

You might find this news story ABC ran on April 13, 2011 about Tax Masters informative. Always please do your due diligence and research any firm before you hire them. In many cases you do not need to hire a firm.

“The Minnesota attorney general says many of the company’s employees are skilled tele-marketers who have little knowledge of the complicated tax issues faced by people who have fallen behind in filing their returns or making tax payments.

“When you call, you think you’re talking to a tax professional,” said Swanson. “You’re really talking to just a salesperson who’s trying to get you to sign up.” ”

http://abcnews.go.com/Blotter/taxmasters-accused-fraud-deception/story?id=13364502

Why does CNN and Fox and local radio stations continue to run the commericals.

To be fair and ethical, the follow link is the response from TaxMasters to the news article.

http://abcnews.go.com/Blotter/statement-tax-masters-founder-patrick-cox/story?id=13374548&page=2

As written all over this blog. Don’t pay huge fees up front to any firm and if it sounds too good to be true….

Seattle Times Originally published Monday, August 23, 2010 at 12:47 PM

By DON THOMPSON

Associated Press Write

SACRAMENTO, Calif. —
California’s attorney general sued “tax lady” Roni Deutch for more than $34 million on Monday, alleging that her law firm regularly violates state law by making false promises that it will help people resolve disputes with the Internal Revenue Service.

Attorney General Jerry Brown contends that Deutch overstates her TV claims of winning tax battles with the IRS. She advertises a success rate of up to 99 percent, yet successfully reduces the amount of money her clients owe in taxes in just 10 percent of cases, the lawsuit says.

“She promises to significantly reduce their IRS tax debts, but instead preys on their vulnerability, taking large up-front payments but providing little or no help in lowering their tax bills,” said Attorney General Jerry Brown, the Democratic nominee for governor in the November election. Click below to read the rest of the article.

http://seattletimes.nwsource.com/html/entertainment/2012702158_apustaxlawsuit.html

Forbes article on the same subject.

http://blogs.forbes.com/williampbarrett/2010/08/24/tax-lady-roni-deutch-is-no-lady-jerry-brown-says/?boxes=Homepagechannels

Great article about rip off tax firm, falls into the trap of over generalization that all firms are bad for the bulk of article, but that is the media world we live in, drama sells. It is ironic that the Ad for the Today show on the front page of MSNBC is promoting a firm in the Today Show ad that has a challenging record, while this editorial article is posted the same day….perhaps advertising and editorial departments should chat more often.

Love the mention about the advice from attorney from Maryland about the 10-tax rules, nice re-write of our Tax Relief Do’s and Don’ts , let’s compare blog posting dates, hmmm, but at least he is promoting the truth.

Another reminder about the BBB, make sure the company has been in business for more than one year and with the BBB for at least a year. They bad guys appear to have 12 month business plan, open doors, get BBB rating, promote A rating, get clients, rip them off, get bad BBB rating, shut doors, repeat.

The simple rule is if it sounds too good to be true, it is

http://redtape.msnbc.com/2010/04/april-15-can-be-a-day-of-fear-loathing-or-even-downright-panic-and-that-can-work-to-great-advantage-for-companies-anxiou.html#posts

Today we received a call from couple who were understandably frighten. They had just off the phone with firm, who first promised them their debt could be settled for $500 (without knowing any knowledge or facts about their case), second, when they hesitated and asked questions he scared them into believing they were going to lose their home and bank account (extra nice touch). He convinced them to give him their checking account so he could start work saving them immediately (not so creative lie)from IRS collections. He told them he would send documents later they would need to sign. The firm immediately took money out of their checking account, according the BBB and online site complaints this is the only thing they “do” for clients. The reason this firm and others like it want checking account numbers, is that unlike credit card transaction is it very difficult for the account holder to contest the transaction.

The couple, had second thoughts, checked up on the company and as you expect they have a bad BBB rating and dozens of complaints. They called us, albeit a bit concerned about the industry, we don’t blame them a bit.

We know we can help this couple, it will take the proper steps to solve their problem, at this time until we review their financials in writing we can’t say with certainty that we will recommend an OIC or IA. We know they will only be charged for the service we perform for them.

If you have the unfortunate experience to call one of these firms or receive call from their aggressive sales people, be firm, listen, ask good questions, don’t believe their crazy unsubstantiated promises or succumb to their fear tactics, and never give them your checking account or credit/debit card number over the phone. Do check out their BBB rating (in business for more than one year) and look at the company online complaint forms.

Last July we received a visit from the an agent from the Department of the Treasury, he informed us that our company name IRS/State Tax Relief Associates, Inc was potentially in violation of a U.S. code regarding the misuse of Department of Treasury names, symbols, etc. The fact that the IRS approved our name years ago and apparently that the IRS was not even aware of the code makes this more amusing and the fact that hundreds of tax returns have been sent to IRS with our company name as preparer had no bearing on how the code was to be interpreted.

After several months of not hearing back, we contacted the agent to ask when we would receive the determination and he informed us he was still working on the file. We did get the chance to voice our frustration that time could spent on our name while dozens of “phony tax firms” were all over TV & the radio every day promising impossible outcomes and stealing from clients while the U.S. Treasury watched without interference was a strange to say the least. We met today to discuss what we should do and decided that a name change is inevitable so we have put the name change process into motion. Now we have to decide on what to change it to. This is a pain! We are sure there is a silver lining to this mess, guess we just have to look harder. More to come.

Several times a month our firm receives a call from a “marketing or lead generation companies” wanting to sell our firm leads from their Television campaigns. Our policy is not participate in this form of marketing for several reasons. First, the company that the TV viewers are responding to isn’t really a tax firm, they are only a firm that sells the information to tax firms that have a boiler room of sales people. We don’t have a boiler room of salespeople that earn commissions by selling “promises” they can’t keep. Second, the TV commercial content is normally filled with half truths and unsubstantiated promises of “pennies on the dollar” and elimination of interest and penalties. These commercials are unethical and they and the firms they are selling to are ripping off of desperate people, who are merely seeking help with their tax problem and deserve to get real representation.

Bottom line. Be very weary of firms that advertise on TV and Radio. Do check out any firm with BBB and other “rip-off research company” internet sites. Do check to see how long the company has been in business. Never do business with a firm that has been in business for less than a few years. Some of these “boiler room” firms play the company name change game.
The good news is that in many states the Attorney General is putting the screws to these firms.

Last week a client called us because they had just gotten off the phone with un-named firm (hint they advertise on TV and claim to have offices across the country) and they were suspicious of what they had been told.  The salesperson from the firm, asked how much they owed, the caller responded $29,000.  The salesperson from the firm without asking any other questions said his firm would reduce the taxes reduced to $2,000 to $4,000 “if they qualified”, and the fee would be $3,900.  The truth is unfortunately most people don’t qualify for an Offer in Compromise and paying $3,900 for most tax solutions is WAY over priced.  The “if they qualified” statement is a clever sales tactic to avoid promises or guarantees of results. This is done to protect their hard sales process, but will get bad results for the caller. Expect to pay a reasonable down payment or retainer, and then pay as you go and as the firm produces results for you. Never pay full in advance or agree to a contract that has an umbrella fee structure, and always double check if it sounds too good to be true.  BTW, this client never would of qualified for an OIC, but we were able to help them with reasonable payment plan, and yes they only paid for the service that was provided.