According to statistics, approximately $1 trillion is collected in individual income taxes every single year.
We understand that dealing with taxes can be excruciatingly painful and frustrating. At this point, many people seek tax resolution services, but if you’ve never done that before, you may not know where to start.
It’s hard to know who to trust when it comes to your taxes. There are so many options, and it can be difficult to determine which company is right for you.
But don’t worry. Keep reading as we’ve put together a list of fifteen tips that will help you choose the right tax resolution service for you.
By following these simple guidelines, you can be sure that you’re making a smart decision with your money.
What Are Tax Resolution Services?
Tax resolution services are given by tax accountants or professionals who can help you with your tax-related problems. Our tax resolutions services can save you money that you spend choosing to handle the IRS by yourself.
Tax season is extremely stressful. But if you owe any money to the IRS or state, we will work on your behalf to find a solution, so you don’t have to worry.
When Would You Need Tax Resolution Services?
Tax resolution services can provide you with many different types of help. For example, tax accountants may be able to help you in the following areas:
Audit Representation – A tax attorney who specializes in representing you to the IRS in case of an audit.
Bankruptcy – Help with filing for bankruptcy in case your debt accumulates to a point where it outweighs your assets or income possibilities.
Offer in Compromise (OIC) – A type of financial negotiation with the IRS when you cannot pay the full amount you owe.
Tax Levy – Filing procedures to stop the IRS from taking property, garnishing wages, or placing a lien on the property when they have already taken action against you.
Tax Lien – A notice that the government has placed on your property that establishes your responsibility for paying taxes that are owed.
If you are not sure whether or not you need tax resolution services, here are several signs:
- Are you facing an audit?
- Is the IRS calling too frequently?
- Have you received notice of levies or liens?
The biggest problem people face when using tax experts is choosing the wrong one. To avoid these common problems, use the following tips to ensure you are hiring a tax resolution firm that can help your situation.
1. Understand the Costs
There are some tax resolution services out there that charge low prices. However, they may require you to sign over your house or other assets as an assurance of payment.
Be sure to read the fine print thoroughly before agreeing to anything.
The biggest benefit of hiring a tax resolution company is to put your IRS matters in the hands of professionals. Make sure you get a firm quote for their professional services, including both current fees and all future costs.
When you work alongside a tax professional, you can rest easy and be confident that you’re doing everything that’s within your power to get the IRS off your back.
A tax professional will be responsible for many parts of the process, including:
- Meetings with tax officials to discuss your case and resolve issues.
- Preparing and filing the necessary paperwork with the IRS.
- Representation if you face an audit or court proceeding.
This is a huge factor since most people who attempt this on their end up showing up in court without representation or by themselves!
Don’t let that be you. Instead, hire a professional before you go to meet the judge (or worse yet, don’t show at all).
2. Beware of Scam Artists
Just like the early days of the internet, finding honest and reputable tax resolution services can be a challenge. This is because there is such a wide variety of bad apples in the business.
Visit the Better Business Bureau site and check for complaints against any company you’re considering using (don’t forget to make use of Google’s tools by searching “company name BBB” or something similar).
Be wary of companies who guarantee results or offer to “settle” with the government for less than you owe
There is always a chance that they can succeed in getting your situation resolved favorably but don’t expect anything that they promise and avoid anyone who uses ambiguous terms like “opportunity,” “possibility,” and “chance.”
Tax resolution does not mean you will never hear from the IRS again, and it doesn’t mean that all of your tax debts can be erased. It means that a new arrangement has been made between you and the agency.
In some cases, these new terms might require monthly payments to meet a more manageable financial obligation, but there is no magic wand that makes your problem disappear for good – so don’t believe the hype.
3. Be Transparent About Your Case
You should be as transparent as possible about your case with the tax professional from the initial consultation. That way, they’ll have a good idea of what needs to be done and how long it will take them to resolve your case.
When you don’t provide them with enough information, this can lead to miscommunications and a variety of other problems.
As a result, you may end up not receiving the best possible service from them because they don’t have all the facts and or evidence needed.
4. Do Your Research
Be prepared to spend some time looking for a reputable company to find one that can deliver on its promises. If you’re able, talk with former clients to get their impressions of the firm’s services and performance.
Depending on how complex your case is, you might seek out an attorney or other tax professional to assist you in the process.
Don’t forget to read online customer reviews and testimonials; these often tell the truth about a company’s performance far better than any sales materials.
If you are unable to find online customer reviews, you can always ask the company to provide you with client information so that you can talk to former customers yourself.
5. Evaluate Their Approach to Your Debt
Some tax resolution services send debt validation requests to the IRS and wait for a reply before they do any work on your behalf. This is much safer than hiring someone who immediately begins negotiating with the agency.
This is because it can take a while for the IRS to acknowledge your request and you don’t want to pay someone in advance if they can’t prove that they have done anything on your behalf.
You should also avoid services that tell you they can get your debt forgiven or reduced. The IRS will only do this in very limited circumstances, and you should never pay for such a guarantee.
6. Ask About Experience
It’s important not only to ask how long a company has been in business but also if they specialize in tax resolution or have a background in accounting. Ask how many cases like yours they handle each year and their success rate.
You should also inquire about the tax professional’s education and licensing. For example, does his or her resume include relevant degrees, licenses, memberships in professional associations?
Be sure that the services you’re hiring are operating legally. If they offer you a settlement for pennies on the dollar, make sure to ask them what prevents the IRS from taking the whole thing anyway.
You should be cautious about any company that operates from a post office box or private mail drop where they can’t meet you in person to do business.
Ask if their office has an actual street address and determine whether they are licensed by your state to perform services on behalf of consumers (ideally, you want someone who is both).
It’s also important to ask your prospective firm what percentage of cases their associates successfully resolve.
Ask to speak to the very best person the agency has on staff and be sure that they can provide you with enough solid information and testimonials to back up any claims.
7. Understand Your Options
As a taxpayer, you have choices when it comes to tax resolution services. One option is to do it alone, which means finding forms and instructions online and filing them by the deadline.
It’s fine to try this method if your case is straightforward but don’t be surprised if it’s a disaster.
It requires you to know all the rules and to work within them, and that means getting professional advice if you’re not an expert on this type of thing.
It’s also important to remember that the IRS doesn’t make it easy for you to deal with them directly.
They want you to hire a professional tax planning service because they know that they are far more likely to get their money when people are represented by professionals.
And even if your case is quite simple, doing it yourself puts you at risk of doing something wrong and having the whole thing thrown out.
Another option is to hire an individual tax resolution specialist who can help you prepare your submissions but doesn’t represent you.
If you decide to do this, keep in mind that you’ll be responsible for staying on top of your case yourself – checking in with the IRS or state tax agency, providing documents, and communicating with collection agencies.
Some hybrid providers offer both tax return preparation services and tax resolution services. These firms tend to be large companies, so you have less chance of problems if something goes wrong with your submission.
They will most likely have the staff to meet with you in person, and if they don’t represent you before the IRS (which some won’t do), they may be able to give you some guidance on the next steps.
8. Review Your Tax Resolution Service Contract
Before hiring a professional, ask for a copy of their contract and read it carefully. There should be no surprise costs or clauses that allow them to make changes without consulting you first.
It should clearly state how much they will charge, what the payment structure is (by the hour or based on results) and whether there are any penalties for canceling your contract.
Also, ask about a guarantee – if something goes wrong with your case, a reliable company should be able to refund your money.
Remember, you don’t have to sign an exclusive contract – any company that insists on this is not acting in your best interests.
If they are representing you, make sure the terms of their representation – what services they will provide and for how much – are spelled out and understandable (are their different payment options?).
9. Get Your Questions Answered
Every good tax resolution service will be happy to answer any questions that you might have about their services, the process in general, and your legal rights in this situation.
If you don’t like how they respond, then find someone else to help you.
It’s important to work with a company that you feel comfortable around because this will affect how much information is shared between the two of you, and that, of course, has an impact on the outcome of your case.
Ask questions like:
- What’s your success rate?
- How long has the provider been in business?
- Will someone handle my case from beginning to end?
- What will the fees be, and how much is each step going to cost?
- What’s your background? [In terms of credentials, experience, etc.]
- Is there a fee for initial consultations?
These questions will help you understand whether or not the company can provide you with the results you are after.
10. Read Reviews and Testimonials
Before you commit to using a tax resolution service, see if you can find reviews or testimonials from other customers online. If they are available, check the Better Business Bureau website for records of complaints.
Also, seek out information about their response to those complaints. Also, look for online forums or discussion boards related to your issue and see if a company representative has posted there.
If you’re looking for personal testimonials, try searching the internet as well as social media sites like Facebook, LinkedIn, and Twitter.
You can also find reviews from past clients by asking friends, family members, colleagues at work, and other professionals you may know.
You don’t have to completely rely on online information, though – meet with your prospective companies in person and ask about their previous clients’ experiences.
Also, when you speak with the company representative, make sure they address any concerns that you have about how a specific case has been handled in the past.
And don’t work with anyone who has been described as pushy or salesy.
You would hope that tax resolution services wouldn’t be like car salesmen, but that is not always the case, especially when it comes to the internet, where competition for your business might make these people act desperate.
When someone seems to be in a hurry or uses high-pressure tactics, then it’s likely that they are trying to get you to sign on with them so they can move on.
Make sure you have all of your questions answered and test the waters before committing yourself; if you don’t like how things are going, then it’s okay to walk away (no hard feelings, of course).
They should not be overly pushy or aggressive. They should make you feel like you are in control of the situation.
11. No Guarantee
Many companies will try to offer you guaranteed satisfaction. However, in reality, a tax resolution firm is unable to guarantee a certain outcome, or they will need to thoroughly disclose this in their client agreements.
A trustworthy company will tell you upfront that your case depends on things such as:
- How much you owe
- How willing the IRS is to negotiate
- Whether you qualify for any possible deductions or exemptions etc
- The prevailing tax laws at the time of your audit
- How long you’ve had the debt
These factors do not make things easy for any company to guarantee you any kind of results.
12. Check Their Availability
Can the tax resolution service call you back when they say that they will? Do they have a voicemail system? So if their office is closed, you can still get in touch with them.
If someone from the company doesn’t return your call within a couple of hours or even the next morning, then it might be time to look for someone else.
And whether you’re working face-to-face with a professional or just over the phone, always get everything in writing!
This way, there won’t be any misunderstandings about what was agreed upon and what services would be provided. Have a pen and paper handy when speaking on the phone so you don’t miss anything important.
13. Find Out What the Tax Resolution Company Requires of You
You will also want to find out what you will be required to do in your tax resolution case. If the company provides you with clear instructions, then that’s a good sign.
This is also where you have to be honest about your situation, so if you don’t follow their instructions or provide them with all the information they need, this could jeopardize your case.
It’s important to be proactive and speak with any tax attorney before putting them on a retainer.
This way, you can ensure you ask them important questions like how you can help during your tax case and how to stay up to date with the ins and outs of the case.
14. Be Aware of the Tax Resolution Company’s “Success” Rates and History
There is no such thing as a magic solution, and tax resolutions services aren’t any different. Even if they guarantee that you’ll be able to sleep well at night, their word isn’t worth much if they don’t know what they’re talking about.
Use resources like Google Scholar (to find articles), people you know (who might have worked with similar firms before), and other websites (like the Better Business Bureau) so that you can check out how well-respected these companies are in the industry.
15. Find a Tax Professional With Clients Like You
In the perfect world, you want to find a tax professional like Bennett Financials that is working with clients similar to you. That way, you’ll know they have experience working with your types of cases.
They should show a genuine interest in your case and should be empathetic about whatever difficulties you’re going through.
If they don’t seem to care or empathize with you, then there’s probably someone else who would value your business more. Don’t get discouraged if the first company doesn’t pan out.
Until you find the right one for you, it will feel like looking for the proverbial needle in the haystack! But once you do find them (and we hope that you do), then your problems might soon be coming to an end.
We Can Offer You the Best Tax Resolution Services
Following the correct tax resolution tactics can help you avoid making any unnecessary mistakes. This will help you to avoid any unforeseen penalties so you can keep your business healthy for next year.
If you’re facing a tax bill that you weren’t expecting, are being audited, or have any issues with tax, we can help you resolve any issues with the IRS.
We provide bookkeeping, tax planning, tax resolution, and CFO services for service-based businesses earning over 250k annually, and we’d love to help you!
Reach out today to get started with our tax resolution services and ensure your rights are protected.
