If you’re reading this blog, chances are you need help resolving a back tax liability. It’s also safe to assume that you’re feeling the pressure of Uncle Sam breathing down your neck, demanding payment. And you may already be wading through the murky waters of the hundreds of Tax Resolution companies that seem to be everywhere these days. Are you looking for a firm that will solve your tax problems without robbing you blind? Unfortunately, many consumers (some of whom became happy M&M clients after being taken advantage of by some of our less scrupulous competitors) are hoodwinked by unrealistic promises and outright lies, told by skilled salespeople with shortfalls of conscience and decency.
In spite of these bad apples, the Tax Resolution industry has become immensely popular. There has been a stampede of companies into the industry from the debt consolidation industry. Why is that? Because recent Federal Trade Commission rule revisions have finally regulated that decidedly shady industry. We’ve even heard of a lending company that is trying its hand at tax resolution since the housing bubble burst. Further, these companies typically have big marketing budgets and attorneys on staff, making the jump to tax resolution an easy one. I like to call them “instant” tax resolution firms. Just add hot water.
However, this isn’t a recipe for longevity. They’ll simply make a quick buck and move on to the next big thing. Many of these companies spend a fortune getting new clients in the door, and worry about how to actually resolve their tax dilemmas after the fact. Aside from the obvious problems with these chameleon companies, there is another issue that many companies and the attorneys that work for them have either ignored or overlooked.
The American Bar Association (ABA) and many individual state’s bar associations have professional rules of conduct, or ethical guidelines that attorneys must follow. The ABA, in Rule 7.3 Direct Contact With Prospective Clients, section (a), states “a lawyer shall not by in-person, live telephone or real-time electronic contact solicit professional employment from a prospective client when a significant motive for the lawyer’s doing so is the lawyer’s pecuniary gain…”
The Colorado Bar Association, Oregon State Bar Association, and Illinois’ Attorney Registration and Disciplinary Commission have identical language in their Professional Rules of Conduct. The State Bar of California, in Rule 1-400 Advertising and Solicitation section (C), states “a solicitation shall not be made by or on behalf of a member or law firm to a prospective client with whom the member or law firm has no family or prior professional relationship…” It seems to me that many of the attorneys at these shady companies are walking a fine line, and inviting disciplinary action.
The ABA’s rules of professional conduct go on to say, “Every written, recorded or electronic communication from a lawyer soliciting professional employment from a prospective client known to be in need of legal services in a particular matter shall include the words “Advertising Material” on the outside envelope, if any, and at the beginning and ending of any recorded or electronic communication…” All of the state bar association rules that we’ve researched have similar wording in their rules of professional conduct.
Many tax resolution firms directly solicit prospective clients. This may include direct mail and phone calls. Obviously, many of these companies shouldn’t be doing it. And not only are they doing it, but many are doing it deceitfully.
Let me explain. The IRS is intimidating to a lot of people. Unscrupulous companies know this and use it to their advantage, preying on people going through a difficult time. A perfect example is the solicitation shown here from just such a company. This letter was sent to an M&M client. It is meant to look very similar to an official IRS notice, which often prompts a delinquent taxpayer to call the number on the solicitation.
This leads to the logical next question for you, the taxpayer looking for help. Who do I want to represent me in this crucial matter in my life? Or, perhaps more importantly, who don’t I want to represent me? It’s logical to believe that an attorney, who breaks the rules of professional conduct of his own profession, would have no problem breaking other ethical rules in regards to tax resolution, client fees and promises of specific outcomes. This type of attorney may even make your situation much worse.
If you have received a direct solicitation from a tax resolution company, find out if it has attorneys on staff. This may be your first clue that you are talking to a dishonest firm, or at the very least one that isn’t familiar with the basic rules its attorneys must follow. Before you hire a tax resolution firm, check into them. Ask the company pointed questions. If what you hear seems too good to be true, it probably is. Check the Better Business Bureau. Call references. Check a company’s length of time in business. Make sure the company you hire is the right size for you. Some people feel more comfortable with a large business, others like the familiarity of a smaller business. But ultimately, of course, the smart money is on hiring M&M. Check us out. We can help. Call us today.
Also, it is important to remember that you don’t need an attorney to represent you when you owe taxes. Remember from our previous post on the History of EAs, an Enrolled Agent from M&M is trained specifically to resolve back tax liabilities and has unlimited practice rights before the IRS, granted by the United States Treasury. Complete our contact form at http://mmfinancial.org/contact.html, or call us at 866-487-5624 to find out how M&M’s Tax Resolution System can help you.