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.

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

“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

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

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

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.

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.

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.

Reality -Unfortunately that it is nonsense, the Power of Attorney or POA is a form to allow a firm to communicate with IRS on the taxpayer’s behalf, it doesn’t have any inherent magical powers nor do these firms. There is defined process to get a Levy release, in some cases complicated and in others very simple.

The only reason the lie works is because client is desperate for help and hears what they want to believe. Having your paycheck or bank account Levied is powerful tool used by the IRS and the fear it generates is understandable, exactly what the “boiler room” firms are counting on. Asking good questions about the process will help you find a reliable firm.