Signs of a Tax-Debt Relief Scam

Signs of a Tax-Debt Relief Scam

• Nov 29, 2021

A large tax debt can be stressful enough to make people feel absolutely desperate for relief—and where there’s strain like this, there are bound to be other who will try to take advantage of it. Unfortunately, there are scams out there masquerading as tax-debt relief programs, when in reality, they will simply steal your money and leave you with even more financial troubles than before. But how can you tell the real tax relief options from the fake ones? Here are a few signs that indicate a tax-debt relief scam.

Guarantees of Drastic Debt Reduction

When working with the IRS, there are rarely (if ever) any guarantees of what your outcome will be. If a company is promising you a drastic reduction in your tax debt, or guaranteeing that they can eliminate or radically reduce your penalties and interest, this is a red flag that it’s a scam. While all of these outcomes are certainly a possibility for some clients, legitimate companies will not guarantee that they can give them to you. Phrasing like that is only present to entice you to reach out and make yourself vulnerable to becoming a victim of the scam.

Not Asking Where Your Tax Debt Stems From

Your reasons for falling behind on your taxes will directly impact the relief programs for which you qualify. This means that a true tax-debt relief service will have to ask you why you’ve fallen behind in your tax payments. While this might feel personal, it is something that we need to know in order to find the right programs for you to apply to. If a business is not asking you these questions, it’s likely because they don’t intend to help you find relief programs at all.

Not Assessing Your Financial Situation

In addition to asking questions about your tax debt, a real tax-debt relief company will also ask you many questions about your finances. The IRS will certainly be reviewing all of your financials in great detail before approving any kind of payment or relief program, so it’s important that your representative also review this information. If they’re not asking these questions and requiring supporting documents, odds are that they’re not really attempting to help you.

Asking for Payment Upfront

If a company asks you to pay them without even consulting with you on your tax debt, then they’re almost certainly a scam. Not everyone will qualify for an IRS tax relief program, so if they take your money without even understanding your tax situation, they’re accepting payment without knowing whether or not they can help you at all. Oftentimes, this will result in the company/scammer stringing you along, then telling you that your application was rejected or your time window for relief has closed.

This is why we offer a free consultation with a CPA for every client we help. We discuss your tax debt, your current financial situation, and assemble an initial resolution plan for you. Once we are confident we can help you with your tax debt, then—and only then—do we accept payment.

What Can a Legitimate Tax Settlement Company Do for You?

While weeding out the scams can be difficult, it’s important to remember that there are legitimate tax settlement companies out there that can help taxpayers like you to settle their tax debts. While it is possible to apply for an IRS relief program on your own, the process can often be confusing, complicated, and difficult to navigate on your own. A tax settlement representative will help you to gather the necessary information and documents, provide a realistic assessment of potential outcomes, and help you find the right IRS program for your individual situation.

The IRS Advocates have helped thousands of taxpayers like you to settle their tax debts, often for less than what was owed. If you’re struggling under the burden of overdue taxes and compounding fees and penalties, reach out to us today. You can sit down with one of our experienced CPAs to discuss your situation, and we’ll help you to determine the best route for handling your debt. While we can’t guarantee that we can drastically reduce or eliminate what you owe, we can promise to always put your best interests first, and work on your behalf for the best possible outcome.

Contact the IRS Advocates today to schedule your free tax settlement consultation.