Hiring a Tax Debt Relief Law Firm

It's hard to miss all the ads for tax debt relief. Hundreds of settlement companies offer to settle your tax debt for a fraction of what you actually owe to the IRS. They promise to deal with the government for you so that you can avoid all of the nasty negotiation. What they don't tell you is how much it's all going to cost. The other thing they don't tell you is that they cannot guarantee that you're going to win a tax settlement. So how do you know who to hire when looking for help with tax debt?

Hire an experienced tax attorney

You are not legally required to have an attorney negotiate a tax settlement with the IRS. You can do it yourself or hire anyone else to do it. But there are good reasons for choosing a tax attorney. An experienced tax attorney knows about a lot more than just IRS settlements. They know what to look for in your tax returns to ensure that you really do owe what the IRS is stating. They also know all of your available options for appeals and settlements that should be explored before jumping to the settlement phase. Don't fall for the advertising hype of some settlement firms. No one will get you a better tax settlement than a good tax attorney.

Understand the payment structure up front

Tax settlement companies (whether they have lawyers on staff or not) can charge for their services in a number of different ways and it is critical to understand the payment structure before signing on as a client. If your settlement firm will only discuss the Offer in Compromise settlement process with you and wants to charge you up front for that, seek out another firm. The Offer in Compromise is the final step in the process when you simply cannot afford to pay the IRS. Only about 16% of Offers are accepted by the IRS and only when all other avenues have been explored. If your settlement firm has decided that you are at that point where you need to file an Offer, make sure their fees are based on success, not on how many hours they have put into the job.

Check the tax debt relief firm out with the Better Business Bureau

Just like all businesses, tax debt relief firms can be good, bad or in between. Because they are representing you in a serious financial matter, it is a good idea to check them out with the Better Business Bureau to ensure that there are no complaints against them. Check with other people you know who have dealt with the firm to get their input. Don't rely on the "testimonials" section on the firm's web page.

Understand what you are agreeing to

Know what it is that your firm wants you to sign, whether it is an agreement with them or is correspondence with the IRS. Have the lawyer take the time to explain in detail the process and what he or she will need you to sign. You are legally responsible to the IRS for any signed agreement or settlement so be sure to know what it says and what it means for you. If any part of the contract makes you uncomfortable, don't hesitate to speak with another lawyer to get a second opinion.

Keep copies of all correspondence with the tax debt relief firm and the IRS

Keep all your own copies of all of the documents involved in any settlement with the IRS. You may need these years down the road when the settlement firm is long gone. Again, you are the one legally responsible for anything you sign so make sure you have copies of what you have signed.

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