Tax-Relief Company Agrees To Refund $1.5 Million To Scammed Customers In 18 States

JK Harris & Company is a tax-relief company in South Carolina that promises to help people settle IRS debts for “pennies on the dollar” by helping them file an Offer in Compromise (OIC) on their behalf. What they didn’t tell consumers is that “the IRS accepts only a small number of these kinds of cases,” writes digtriad. What they also didn’t mention is that they’ll accept your money even if they know you won’t qualify for an OIC, and they won’t give refunds. “In many cases, JK Harris did not even apply to the IRS to help consumers as promised. But the company still refused to give those consumers their money back.” Now JK Harris has made an agreement with attorneys general in 18 states to change its advertising and pay $1.5 million in restitution.

JK Harris wasn’t just misrepresenting its services. It also made it very difficult for customers to resolve any questions or complaints:

According to Cooper’s complaint, JK Harris regularly advertised it had more than 450 offices nationwide. However, the complaint contends that only the main office in Charleston handled consumers’ files.

If a consumer wanted to meet with a JK Harris representative about their file they had to physically travel to Charleston.

The other offices were staffed only by sales representatives who could not help consumers with their tax problems.

JK Harris also claimed consumers’ cases would be handled by “tax experts” or “ex-IRS agents” when in fact the people handling the cases did not fit those descriptions and did not have tax expertise.

JK Harris case managers changed frequently, and consumers complained they often had to provide the same information to the company several times.

Under the terms of the agreement, JK Harris now has to:

  • pay refunds to customers if it can’t help them with their tax debts, or if the IRS doesn’t accept the OIC;
  • provide accurate information on when a customer can qualify for an OIC and how frequently the IRS accepts such claims;
  • stop lying with its advertising and sales practices;
  • never offer or perform credit repair services.

If you know someone who lives in one of the following states, they should contact their attorney general’s office for more information on how to qualify for a refund from JK Harris (we have the number for NC because that’s where the article was published):

Arkansas
Arizona
California
Connecticut
Florida
Illinois
Maine
Massachusetts
Michigan
Minnesota
New York
North Carolina (1-877-5-NO-SCAM)
Ohio
Pennsylvania
South Dakota
Tennessee
Vermont
West Virginia

If you owe back taxes and aren’t sure what to do about them, the best thing to do is pay a visit to an experienced and knowledgeable accountant for help. He or she should be able to help you figure out how much you owe (in some cases you may have actually overpaid, and simply filing the appropriate forms for the missing years will solve your problem) and help you set up a repayment plan that fits within your budget.

“‘Pennies On The Dollar’ Tax Relief Company Ordered To Pay Refunds” [Digtriad]
(Photo of sneaky snake: Getty)

Comments

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  1. bcsus83 says:

    goes back to the old saying our mothers taught us when we were 8: “If it sounds too good to be true, it probably is.”

  2. Mike8813 says:

    It’s unfortunate that people fall prey to companies like this. But it seems that harboring a large debt can sometimes make people throw logic to the curb.

  3. radiochief says:

    You can make these OIC yourself.

    But it is usually better to go through a local reputable tax lawyer or an enrolled agent. Also bring in your tax preparer if someone else did your taxes for you.

    The IRS can be helpful (depending on your circumstances) as long your your returns and evidence supporting those returns are in order. They don’t suffer fools and claiming ignorance or bad tax advice won’t help you.

  4. geoffhazel says:

    If you make a payment plan, be sure you stick to it. The IRS has no mercy if you break the payment plan. Let’s just say, I found this out the hard way back in the ’80s.

  5. mythago says:

    The IRS is usually happy to help you pay them, and will work with you if you are trying to make good. That doesn’t mean they won’t jack you on interest, but it beats going to jail.

  6. nikalseyn says:

    the easiest way to get a tax debt off your back is to be declared “uncollectible” by the IRS. This happens all the time, to all kinds of people and tax debts. You wouldn’t believe how much the IRS has put into this category—billions of dollars. Also, if you don’t owe a whole lot, you may just be “shelved”—in other words, IRS doesn’t have enough personnel to work cases, so it just lets them sit there untill you owe more years, etc., or the statute of limitations runs out and then you are scott free.
    All in all, no need to pay money to anyone to get the taxman off your back. Besides, the new breed of tax collectors are trained to be kinder and gentler, ie., rather ineffective.

  7. @nikalseyn: And how does one go about getting their tax debt declared “un-collectible”?

  8. radiochief says:

    @geoffhazel: So true. They will work with you if you appear to be acting on good faith with a “reasonable” payment.

    If you owe thousands or tens of thousands of dollars, telling them you can afford $50 or $100 bucks ain’t gonna help.

    This is especially true, if the money owed was discovered through an audit which was triggered by a red flag on your return.

  9. MerylBurbank says:

    I did not realize that tax debt was subject to any statute of limitations.