The FTC Warns Taxpayers About Tax Relief Companies
The Federal Trade Commission (FTC) is the nation’s consumer protection agency. It works to prevent fraudulent, deceptive and unfair business practices in the marketplace. It weighed in on the tax relief companies in an article posted on its website. Taxpayers should consider the FTC’s warnings before hiring a tax relief company.
The FTC describes some of the unscrupulous practices employed by tax relief companies. These practices include:
Charging a flat rate for the work of all employees at the firm, not just the tax professionals at the firm.Making unauthorized charges to your credit cards or withdrawals from your bank accounts.Not sending the necessary paperwork to the IRS requesting participation in the government programs they discussed with you.
The FTC goes on to provide several cautions to taxpayers who may be thinking of hiring a tax relief company. This includes being wary of tax relief companies that:
Advertise on radio, television and the internet.Claim they can reduce or even eliminate your tax debts and stop back-tax collection without first evaluating whether you qualify for the various government programs.
The FTC also recommends taxpayers not pay up front fees to a tax relief company without first reading the contractual terms that govern how the amounts are to be refunded if you cancel the service.
The FTC advises taxpayers to file a complaint with the IRS if the tax relief company:
Promises that you will get relief from tax liabilities,Misrepresents how long it will take to process a debt relief request application, orOmits relevant asset information on financial statements submitted to the IRS.
These are all valid points that should be considered before hiring a tax relief company. You can read the full version of the FTC’s article athttps://www.consumer.ftc.gov/articles/0137-tax-relief-companies