Best Tax Relief Companies

Tax relief is any reduction in taxes owed by an individual taxpayer or business entity, including tax deductions and tax credits. For example, a tax credit can incentivize homeowners to make energy-efficient repairs, and a tax deduction can decrease the overall tax burden for those affected by a natural disaster.

People who owe a tax debt often seek tax relief to reduce the amount they owe to the IRS or state tax agencies. Those who didn’t file a tax return, misfiled their return or were unable to pay taxes end up owing a tax debt that accrues penalties and interest. Many people facing this tax burden do not have enough liquid assets to pay the full amount at once and require assistance.

Tax resolution companies specialize in tax reduction strategies to resolve back tax debt and unfiled returns, including installment plans. IRS debt tax relief professionals also negotiate with the IRS and state tax commissions on behalf of their clients.

Tax relief companies employ tax experts, including tax attorneys, certified public accountants and enrolled agents, who serve as intermediaries between their clients and the IRS. These tax experts work with the IRS to find ways for consumers to resolve their tax debt. IRS debt help experts also help consumers by negotiating tax relief programs, tax debt settlement agreements or tax debt installment agreements.

The IRS offers several tax debt relief programs. Taxpayers can apply for tax relief from the IRS directly or hire a tax relief company to help negotiate on their behalf. If you owe a tax debt of more than $10,000, it’s smart to hire a tax relief professional who has experience negotiating with the IRS.

Seek professional tax relief help if you owe more than $10,000

When you work with a tax relief company, its professionals negotiate a tax relief program for you. Some IRS tax relief programs, like innocent spouse relief, remove improper tax liabilities. Others, like the release of wage garnishments, stop the IRS from seizing your wages or assets to pay back taxes.

Tax relief companies use different types of contracts — some tax relief companies require clients to sign a contract, while others do not require customers to sign any paperwork and allow them to start and stop work at their discretion. Any contract you sign with a legitimate tax relief company should clearly define the scope of the work, the payment schedule and how you’re billed.

Common tax problems

If you have a tax debt, you should attempt to pay the balance as quickly as possible. Unpaid tax bills collect interest and monthly penalty fees. If you can’t pay everything you owe at once, negotiate with the IRS to come up with an installment plan. The IRS is patient — and even flexible — if you make an effort to set up a payment plan. Ask a tax relief company for help if you need assistance with tax problems, including:

• Unfiled tax returns: It’s always best to file your taxes on time, even if you can’t pay what you owe at that point. Unfiled returns create tax issues such as penalties, loss of refunds, refund holds, substitute for returns and tax resolution hurdles.
• Tax filing mistakes: The IRS may assess penalties and interest if you file a return with math mistakes, submit the incorrect form or file the wrong status. You can avoid tax issues caused by filing errors by filing an amended tax return with Form 1040X.
• Penalties and interest: When you don’t file taxes or file them incorrectly, the IRS charges failure-to-pay penalties and interest on unpaid balances. These penalties add up quickly — IRS debt interest compounds daily from the due date of the return until you pay the full balance.
• IRS wage garnishments: If you’re not making payments on your taxes, the IRS can have your employer redirect a portion of your income to pay your tax debt. The IRS can apply wage garnishments to hourly wages, salaries, commissions and bonuses. The IRS can legally seize up to 70% of your wages through garnishments until you make arrangements to pay the overdue tax debt. To qualify for the release of a wage garnishment, you need to provide proof of income and expenses to show how the wage garnishment creates a financial hardship for you. You can avoid wage garnishments by entering into an installment agreement or making an offer in compromise.
• Tax liens: The IRS can claim your property and assets if you neglect or refuse to pay your tax debt. Tax liens secure the government’s interest in your assets. A Notice of Federal Tax Lien may stay on your credit report even if you file for bankruptcy.
• Tax levy: If you owe taxes and don’t make payment arrangements, the IRS can seize your finances and assets. The IRS can put a levy on bank accounts, which lets the agency take funds to cover the balance you owe. Unlike a lien, an IRS tax levy takes your assets to pay off a tax debt. The IRS and state governments use tax levies to seize all types of property and assets.

On average,
tax relief costs
$2,000 - $7,000.

Tax relief costs range from $750 to $10,000 or more, depending on your tax debt circumstances. Generally, the price of tax resolution services varies based on the complexity of the case.

A case of average complexity typically ranges from $2,000 to $7,000. Complicated tax situations are more expensive because they require additional work and documentation from the tax relief company. Highly complex tax relief cases cost up to $8,000 or more to resolve. Tax relief companies might charge as little as $250 for penalty abatement or upwards of $10,000 for an offer in compromise (OIC) case.

After a free initial consultation, tax relief agents usually charge a $400 to $600 setup fee. Tax relief companies vary on how they bill clients after this, however — tax resolution fees can be time-based, debt-based or a flat fee.

• Time-based fees are charged on an hourly rate, and the total cost is based on how long it takes the tax relief company to handle a client's case.
• Debt-based fees are set based on a percentage of the total tax debt the client owes.
• Flat rates are set based on the service and do not change regardless of the size of the debt or how long it takes the tax relief company to perform that service.

Tax relief companies provide a wide variety of tax relief options to help people with unpaid taxes. These companies employ trained professionals who help you with multiple services, including negotiating tax debt. When you work with a tax relief company, the company creates a tax relief program for you that combines the following types of tax help services:

• Tax preparation: A tax relief company can help you prepare tax returns to file with the state government and IRS. Tax preparation services include filing a paper or electronic tax return, whether it's early or late.
• Tax consultation: Tax consultation is an excellent way to learn more about federal and state collection processes from experts. You can discuss your tax relief options for how to remove liens or levies, prevent seizure of assets and wage garnishment, set up a repayment plan or file overdue tax returns.
• Tax settlement and negotiation: Tax settlement is an arrangement in which the IRS accepts an amount less than your outstanding taxes to retire the debt. A tax relief firm helps you negotiate an installment payment agreement, partial payment settlement agreement, tax penalty abatement or financial hardship status. A tax relief company also advises you on the statute of limitations for IRS collections.
• Tax resolution: Tax relief companies provide guidance and representation to resolve tax debt. Tax resolution services include audit representation, criminal tax defense, installment plans, levy releases and penalty abatement. Tax debt solutions help you deal with the IRS to stop wage garnishment, remove liens and file unfiled tax returns.
• IRS appeals: A tax relief firm can file an IRS audit appeal or IRS collections appeal on your behalf. The Office of Appeals, an independent organization within the IRS, handles all tax forgiveness appeals. Appeals are considered informal if the Office of Appeals representative contacts you by telephone, mail or email for discussion. Before speaking with the representative, a tax relief company helps prepare a list of reasons you are objecting to the IRS’s decision. IRS appeals can take from several months to a year to complete.
• Business payroll tax relief: Some tax relief companies work with business owners who owe taxes to the government but cannot pay them. These issues typically involve payroll taxes, including employee wage deductions that have not been paid. Many of these business owners are at the helm of companies struggling to stay financially solvent. It’s essential to have this issue resolved to avoid the IRS seizing the company’s assets to fulfill the debt.

You can use tax relief programs to set up a payment plan or negotiate a tax debt settlement with the IRS. Remember, tax relief isn’t about shirking your tax obligation — it’s about making it easier to pay off your existing tax debt. Tax relief companies specialize in negotiating back tax debt relief plans on a client’s behalf.

• Offer in compromise: An offer in compromise is an agreement between a taxpayer and the IRS that reduces the total amount of tax debt owed. The IRS often agrees to an OIC if there is legitimate doubt over whether the taxpayer is liable for the taxes owed or if it is unlikely the agency can collect the tax debt. If approved, you can pay your settled IRS bill with a lump-sum payment or periodic payments. A tax relief company can help you apply for an OIC, or you can do it yourself. It can take the IRS anywhere from four weeks to eight months to accept an offer in compromise. Once you agree with the IRS on an OIC, you have two years to repay the amount.
• Innocent spouse relief: You could qualify for innocent spouse relief if your spouse or former spouse omitted or improperly reported items on your joint tax return. Innocent spouse relief only applies to tax debts on individual income or self-employment. Separation of liability relief and equitable spouse relief provide an allocation or deduction of tax debt if there was an error on a joint tax return.
• Installment agreement: An installment agreement is a tax repayment plan offered by the IRS that allows consumers to pay their unpaid taxes in monthly installments. Those with a tax debt balance of less than $100,000 qualify for an installment agreement. An installment agreement is guaranteed if you owe less than $10,000 and can pay off the full amount within three years. Typically, taxpayers who owe more than $100,000 to the IRS are not eligible for installment agreements. The IRS offers short-term and long-term installation agreement payment plans.
• Penalty abatement: Tax penalty abatement waives a penalty the IRS has issued to a taxpayer. These penalties are often given for failing to file taxes on time or missing a tax payment. You might qualify for penalty abatement if you were penalty-free for three years before receiving the penalty you’re attempting to have waived. You might also be eligible if you filed an extension request or if you paid or plan to pay the amount due. Because failure-to-pay penalties grow over time, you should pay off the penalty before requesting the penalty abatement. If it is granted, you receive a rebate.
• Currently Not Collectible: The IRS only declares a taxpayer “Current Not Collectible” if the taxpayer has no way to pay their debt. Currently Not Collectible status, also called a hardship extension, can be used to stop an IRS lien, levy, seizure or termination of an installment agreement.
• Fresh Start Program: The Fresh Start Program is a streamlined installment plan that makes it easier for individuals and small businesses to pay back taxes while avoiding tax liens, interest, penalties, garnishments and seizure of assets. The IRS Fresh Start Program began in 2011 for taxpayers who owe less than $50,000 and earn less than $100,000 per year. To qualify for Fresh Start, you must have filed all of your tax returns and not entered into another payment plan in the past five years. Those who have filed for personal bankruptcy are also disqualified.

Nobody likes dealing with the IRS, but the longer you wait, the larger your tax debt becomes. Some different tax debt resolution options to pay off the IRS in full or partial payments include:

• Lump-sum payment: If you owe money to the IRS, it’s always best to pay in full to minimize interest charges and penalties. If you can’t make the whole payment all at once, you could qualify for an extension of up to 120 days.
• Payment plan: If you can’t pay everything you owe immediately, you can negotiate with the IRS to come up with a short- or long-term payment plan.
• Credit cards: You can pay federal taxes with a credit card. The IRS doesn’t accept direct credit card payments, but there are licensed payment processors that accept credit card payments on the IRS’s behalf. Be aware that these companies charge a fee to settle tax debt with a credit card. You must also pay interest to your credit card issuer until you pay back the amount.
• Bankruptcy: Filing for Chapter 7 bankruptcy can discharge income tax debts under certain conditions. The debt must be at least three years old, you must have filed a tax return and the IRS must have assessed the debt within 240 days before you file for bankruptcy.
• Statute of limitations: Generally, the IRS collection process on taxes, penalties and interest has a 10-year statute of limitations. The 10-year period starts on the date of your tax assessment. If IRS tax debt forgiveness after a decade sounds too good to be true, keep in mind the period can be suspended multiple times and may last much longer. 
• Hire a tax professional: If you owe more than $10,000, it’s smart to hire a tax relief professional with expert knowledge of how to negotiate with the IRS. The average cost of a tax attorney ranges from $750 to $10,000 or more, depending on the complexity of your case.

We’ve compared the best local tax relief companies across the United States to help you find trusted tax relief services in your city.

• Albuquerque
• Atlanta
• Austin
• Bakersfield
• Baltimore
• Boise
• Buffalo
• Chicago
• Cincinnati
• Cleveland
• Colorado Springs
• Corpus Christi
• Dallas
• Denver
• Detroit
• Fort Myers
• Green Bay
• Houston
• Indianapolis
• Kansas City
• Lafayette
• Lansing
• Las Vegas
• Lexington
• Los Angeles
• Milwaukee
• Missoula
• Nashville
• Omaha
• Orlando
• Phoenix
• Pittsburgh
• Portland
• Sacramento
• San Antonio
• San Diego
• Santa Barbara
• Tallahassee
• Tucson
• Tulsa
• Waco
• West Palm Beach