Does anyone have any experience with these companies that are supposed to help you with your IRS tax bill, companies like Optima Tax Relief? I have dug myself a pretty deep hole. The IRS offered me a payment plan but it is still pretty steep.

Any suggestions from the Sig Forum brain trust would be appreciated.

Thanks,

I would see a CPA or Tax Attorney. I think those folks are after whatever money you have left. I do not think it would take much time for a CPA or tax attorney to advise you of whether you can negotiate the payment plan with the IRS. The companies sound like scams.

I would deal through a CPA first

You may need to give their tax manager a POA to act in your behalf but I would do that long before I would ever go to a place like Optima.

Al Capone was only able to be taken down when he got in the cross hairs of the IRS. If you're going to pay for help with your taxes, you might as well get a tax attorney rather than some paralegal or tax advisor service. A CPA has no privileged relationship with you.

We recently had a multi-year tax issue due to a complex series of events. We relied on our CPA for advice, which turned out to be a bad idea. CPAs know the laws regarding filing and calculating, but they are not all experts on negotiating with the IRS to navigate a complex minefield once the IRS decides money is owed. What we put on the various appeals forms wasn't as strong as we needed.

We eventually contacted one of those attorneys who advertises they save people huge dollars. By then it was too far down the road to change the outcome. Had we approached them at the beginning, we could have structured some things differently and avoided big taxes.

Since those lawyers work on a fee structure, the question is whether you might owe enough to make it worth paying the legal fees to reduce it some. The other question is whether they might be able to make problems go away if you somehow violated rules (such as failed to file, failed to declare income, etc) which might cause penalties.

The benefit of the lawyer route is they can approach the IRS on your behalf, showing that you are voluntarily coming forth about things which the IRS is not (yet) aware of. Imho that can be a powerful advantage to you rather than simply starting to file new or amended paperwork. Without an advocate you are likely to have the IRS impose penalties which you then have to appeal.

The attorney will give you some free initial consultation, and then they can tell you what they think they can do for you and what it will cost.

Sounds like you have a money problem not an accountant problem. What is this service supposed to do for you? Amend your filing? If you owe the taxes and they were filed properly I don't get what the can do to help you. They will likely just offer you a loan. I'd check with you bank and credit cards and try to find a good offer. I'm just spit balling here because I don't know anything about tax assistance companies or whatever they call themselves.

My experience and I'm by no means an expert... they can put you in jail for not filing but not for not paying.... I bet there is a way to renegotiate payments.

I will say if you had not filed yet there was a different way to help you out... but that seems to have passed.

Those companies usually charge several thousands of dollars. The result may be same as it would have been if you contacted the IRS yourself.

This is not tax advice.

quote:

My experience and I'm by no means an expert... they can put you in jail for not filing but not for not paying.... I bet there is a way to renegotiate payments.

^^^^^^^^^^^^^^^^
Well, the IRS can freeze your bank account and all of your assets. At least in jail they feed you. You are better off having either a tax attorney or experienced CPA negotiate on your behalf. Both will ask that you sign some legal documents so they can deal with the IRS.

A good Enrolled Agent may be a cheaper option.

thanks for all the good advice. I'll figure something out.

Bob,
I have no experience with any of the firms that offer tax relief or help. In the Detroit metro area, Levy and Associates advertise as helping solve issues with the IRS

https://www.levytaxhelp.com

This is not a recommendation, just another firm that you could talk with about your concerns.

Good luck.

quote:

Originally posted by Oz_Shadow:
A good Enrolled Agent may be a cheaper option.

This would be your best start, I think. As I mentioned in another tax-related thread, an EA can practice before the IRS - including Tax Court.

I'm familiar with the franchise structure of H&R Block and, at least in our four offices, you can walk in and talk to an EA at no charge. The costs come when they start working on your behalf and you will be told what the price per hour will be. Ask first what any costs there might be before sitting down as I don't know how other franchisees or company offices do their pricing.

Our EAs will also try to give a best estimate total cost based on the situation and their experience with similar work, but remember it's just an estimate. It's the IRS you're dealing with so the cost to you in time and money is of no concern to that organization.

At best you'll find an EA (Block, Jackson-Hewitt, independent) that you like and is able to explain everything so that you understand your situation from all points of view and perspectives, as well as the best possible solution for you.

Consider your tax situation like you would a health issue and see multiple professionals. Do all the recommendations agree? Does one make more sense than another? Has each pro explained everything so you have a clear understanding of what needs to be done, by whom, and when? And so on...

Like others, I don't recommend using a tax relief company. I also don't recommend going it alone thinking you're going to save money. Get professional help from someone that specializes in tax work and, at least with what I know, that means an Enrolled Agent or a tax attorney. I have to defer what a CPA can or would do in your case to an actual CPA.

But if consults are free with any or all of these professionals, then talk to as many as you can or want to. If you haven't done so already, go to see one or more immediately as there may be a letter or paperwork that needs to be sent (and documented as such) to stop a lien, give more time to gather information, etc. At least that will show the IRS that you are working in good faith to resolve the problem.

Edit to add:

While I was typing I forgot that you've already been in contact with the IRS so there may not be an issue of immediacy. Still, talking to a professional sooner than later would be in your better interests.

If he/she can, the pro will find a better solution than what you and the IRS have pending. He or she will also be able to clue you in to other possible payment options that the IRS might not be letting you know about.

This message has been edited. Last edited by: marksman41,