IRS resolution services are designed to help taxpayers eliminate a portion of their tax debt. If you’re struggling with past-due taxes that you can’t afford to pay, working with a legitimate resolution company can help you avoid staggering penalties and interest.
If you already owe money to the IRS, you may be hesitant to hire a tax attorney or certified public accountant (CPA). After all, these services can be costly. However, tax professionals have the resources and knowledge necessary to negotiate with the IRS and understand complex and ever-changing tax regulations.
Understanding what to expect from tax resolution services can help you determine whether you should consult with a professional. In general, these services include:
Image via Flickr by TaxCredit.net
Once your return review and financial analysis are complete, you will usually get a quote for the necessary next steps. The initial analysis is often free or may be charged at a flat rate.
However, if you need additional tax help, you’ll likely be subject to a different rate structure. You will need to sign a contract with the cost of your desired services and the agreed-upon payment schedule. Common schedules include:
Some tax professionals charge an hourly rate. They will bill you for the time spent working on your case. Fees average $200 to $550 per hour. Other professionals charge a flat fee. This can be based on either the total service or your amount of tax debt.
The average cost of tax debt assistance ranges from $3,500 to $4,500 for an individual taxpayer and $5,000 to $7,000 for small business owners. The more tax debt you have and the more complex the required solution, the higher the overall cost of tax resolution services.
These are the average reported prices for common tax relief services:
Make sure you get a detailed quote before hiring a tax resolution firm.
It’s important to research the background of the tax professional you hire to resolve your debt. Big-name companies often charge larger fees because they need to compensate for marketing costs. Smaller companies with reliable track records and good references often provide a bargain for the struggling taxpayer.
Make sure the professional you hire has tax resolution experience. Although every CPA can prepare your taxes, they don’t all have the knowledge and skills to negotiate with the IRS on your behalf. Ask the person if he or she has handled cases like yours before and what outcomes resulted. Choose a firm that has been in business for at least a few years and that is able to provide references from satisfied customers.
If you hire an attorney, make sure he or she is admitted to the state bar. CPAs should also be licensed in the state of practice. Look for an individual who is certified as a tax attorney or a tax resolution specialist. They should ideally belong to a professional association like the Institute of Certified Public Accountants or the American Society of Tax Problem Solvers.
To obtain tax resolution certification, the individual must be an enrolled agent (EA), CPA, or tax attorney. Enrolled agents must pass a test given by the IRS to demonstrate their tax law knowledge and/or have experience working as an IRS agent.
When you use Solvable, it’s easy to find IRS resolution services that fit your needs. We’ll ask you a few simple questions about your tax debt and match you with vetted, well-reviewed companies that can offer relief. Visit us today to get on the path to a debt-free future.