That’s why we’ve compiled a list of some of the best tax relief firms that have a proven track record of success in offering tax debt solutions. If you’re looking for a reputable tax relief company to help alleviate your financial hardship, this list is a great place to start.
The Top 5 Best Tax Relief Services of 2022
- Community Tax: Best tax relief company overall
- Coast One Tax Group: Best reviews
- Optima Tax Relief: Best for IRS audit representation
- Anthem Tax Services: Best for stopping wage garnishment
- Tax Defense Network: Best customer service
#1. Community Tax
Community Tax offers extensive tax relief services for individuals and small businesses. It assists with both federal and state tax concerns and has a comparatively low minimum debt requirement of $8000.
The company offers a wide array of tax services, including:
- Tax lien assistance
- Payroll tax negotiations
- IRS audit defense
- Wage garnishment prevention
- Tax extensions
Community Tax also offers non-tax relief services that simplify your tax returns process and make tax season significantly less stressful. You can access these services for a small monthly fee, and the services include:
- Tax return preparation
- Tax monitoring services
- Bookkeeping and accounting services
Community Tax follows a three-step tax resolution process. Once you complete its online form, you’ll get a free consultation to see whether the company can provide the help you need. If you decide to proceed, you’ll get a dedicated Community Tax case manager to keep you informed of any developments and guide you through the tax resolution process.
The second phase involves investigative work, through which the Community Tax team gets all the details it needs to assess the scope of your issue and identify the right steps to solve it. This step will cost you a one-time discovery fee.
The final step is the meat of the process: resolution work. Resolution occurs when the Community Tax expert team of tax lawyers and chartered accountants negotiate with the IRS on your behalf to resolve your tax concern. The fees for resolution work vary, depending on the scope and complexity of your situation, but you’ll receive a detailed quote from your case manager before you agree to proceed.
Community Tax also has a 14-day money-back guarantee: If the company fails to negotiate a reduction of your tax liability or monthly payments within the first 14 days of your application, you’ll receive a full refund on the investigation fees you paid.
This guarantee, combined with the company’s A+ rating as a Better Business Bureau-accredited business, should give you the peace of mind that this is a legitimate tax relief firm that may provide the results you want.
#2. Coast One Tax Group
This Encino, CA-based tax relief firm has 14 years of experience helping individuals with their IRS debt concerns. Coast One Tax Group provides federal and state tax debt relief services to individuals and small business owners who have a minimum tax debt of $10,000.
The company has a diverse team of tax professionals on staff, including tax attorneys, enrolled agents, certified public accountants (CPAs), and dedicated resolution managers. These teams work together to provide you with fast, reliable tax debt relief.
According to its website, Coast One Tax Group offers:
- Tax resolution services such as negotiation, liens, bank levies, and wage garnishment relief
- IRS audit defense
- Bookkeeping
Coast One Tax Group follows a tax relief process similar to that of many other tax relief companies. The process starts with a free one-on-one consultation, during which the company decides if you’re a suitable candidate for its tax relief service. This is also your opportunity to get quotes and resolve any potential concerns before proceeding with the process.
Once you’ve signed up, the company’s tax professionals will do a full investigation of your finances and tax debts and identify the best way forward. You’ll need to pay a retainer fee to get this investigation started and additional fees for the resolution phase.
A Coast One Tax Group tax professional will negotiate on your behalf to reduce and resolve your back taxes during the resolution phase. Your fees for this stage will depend on the scope and size of your tax debt, as well as the complexity of the case.
While Coast One doesn’t offer a money-back guarantee, it has many favorable reviews on social media as well as an A+ BBB rating. The company also offers flexible payments on its fees, which can help alleviate some of the burden associated with the fees that tax relief companies charge.
Click Here to Learn More About Coast One Tax Group
#3. Optima Tax Relief
Optima Tax Relief is a major player in the tax resolution industry and has made its name known as being one of the most trustworthy tax relief companies on the market, with high quality, professional work. Since 2011, the company has provided a range of tax services to individuals and businesses, focusing on tax relief. The company also offers:
- Tax protection services such as tax filing assistance, credit monitoring, audit defense, and identity theft protection
- Tax preparation services such as maintaining payroll taxes, filing your tax returns, and bookkeeping
Similar to other tax relief services, Optima Tax Relief has a minimum debt requirement of $10,000.
Optima Tax Relief has a three-step process to get individuals and businesses out of tax debt. The first step is a free consultation, at which you meet with a consultant to discuss your needs, situation, and expectations. The consultant will help you decide if moving forward with tax relief services is the right move and give you the information you need to make an educated decision.
While the consultation is free, the next two stages will cost money. The investigative stage is where Optima’s professional investigative team will obtain and examine your financial information to develop a plan of attack to deal with your tax debt. You’ll need to pay a fixed one-off fee for the investigation.
Once Optima Tax Relief develops a tailored plan for your situation, you’ll move into the resolution phase, where Optima will communicate with the IRS on your behalf. This state is the most expensive part of tax relief, but the cost will depend largely on your situation—the more complex it is, the higher your fee.
Optima is up front about the fact that its services aren’t suitable for everyone and that there are situations where it can’t save you money. The free consultation is an excellent way for you to decide whether tax relief is the right move for your particular needs. Optima also offers a 15-day money-back guarantee, so you can claim your investigation fee back if the tax relief company fails to lower your tax debt.
#4. Anthem Tax Services
Anthem Tax Services has worked in the tax relief industry since 2010 and has grown into a large company staffed by enrolled agents, tax attorneys, and CPAs. Many of its consultants are members of industry-leading bodies such as the NATP and NAEA.
The company requires a minimum debt of $10,000 to offer its tax relief services. The best tax relief companies often use a debt minimum to ensure that you’re getting your money’s worth of services—you don’t want to pay $3,000 to get $2,500 of tax debt relief for a relatively small debt.
Anthem Tax Services offers a massive range of federal and state tax debt relief solutions for a host of different tax concerns. In addition to tax resolution, you can also work with Anthem Tax Services to:
- Prepare corporate tax returns
- Protect yourself during an IRS audit
As with many other tax relief companies, Anthem Tax Services offers a three-stage tax relief program that starts with a free consultation. This consultation is essential for deciding whether working with a tax relief company is the right choice for your financial situation, and also gives you an opportunity to ask questions about fees and the process itself.
While the consultation is free, the second step, investigation, isn’t. Anthem Tax Services has one of the lower discovery retainers in the business, making its tax solutions accessible to all. Anthem uses the investigation state to gather your financial information and develop a tax relief plan suitable for your needs.
The final step is tax resolution, during which Anthem’s leading team of professionals will work on your behalf with the IRS. They’ll negotiate potential solutions to reduce your state or federal tax debt or give you more leeway in penalty payments and monthly costs. The total cost for resolution depends largely on the complexity of your case, but you’ll receive a quote before moving on to this stage.
Like many legitimate tax relief companies, Anthem Tax Services offers a money-back guarantee if it fails to reduce your tax debt. However, unlike other companies, the organization offers a full refund on discovery and resolution fees, which is a welcome change from tax relief companies that only refund the smaller investigation fee.
#5. Tax Defense Network
Tax Defense Network is one of the older tax relief companies on our list. The company started operating in 1997 and offers federal and state tax debt resolution services to individuals. Tax Defense Network primarily offers tax relief services, including:
- Asset seizure and tax levy assistance
- Tax lien assistance
- Wage garnishment support
- IRS communication
The company also offers tax audit representation, tax assistance, and small business accounting services, making it a great one-stop shop for all your tax needs. Tax Defense Network and its staff have numerous accreditations, including certifications from the NATP, NAEA, American Society of Tax Problem Solvers (ASTPS), and American Institute of Certified Public Accountants (AICPA).
Tax Defense Network has a minimum debt threshold of $7,500, slightly lower than the industry standard.
Like all good tax relief companies, Tax Defense Network uses a three-step program to decide, identify, and resolve your tax debt. The initial no-obligation consultation is a great way to decide whether tax relief is a sensible option for your financial situation before moving on to the actual investigation and resolution.
Tax Defense Network offers flexible payments, which makes it easier to afford its services. The company offers many payment plans to help ensure that its services can be available to anyone who needs them.
Ww believe what makes Tax Defense Network appealing is that the company is honest about what its licensed tax professionals can achieve and may ensure that you have realistic goals during the process. The Tax Defense Network also contains an extremely useful knowledge base that explains common tax problems and potential solutions, which can significantly help demystify how tax relief works.
While the company doesn’t have an official money-back guarantee, its A+ rating at the Better Business Bureau means that it’s a tax resolution firm that offers reliable tax solutions that work. With the company’s conservative outlook on what solutions it can offer, you may find a solution that works best for you.
How Do Tax Relief Companies Work?
The IRS offers tax relief as a way for people to reduce their financial burden while still paying their due. It’s important to note that tax relief options help you cope with your tax debts—not erase your debt.
It’s completely possible to negotiate your tax relief plan directly with the IRS for free. However, this method tends to be stressful and time-consuming, and if you’re struggling with debt as well as taxes owed, the last thing you need is more stress.
Tax relief companies contact and work with the IRS on your behalf. These companies have experienced tax professionals, including tax attorneys and accountants, who know how the system works and can develop tax relief programs, such as installment agreements, that will work best for your situation.
Working with a reputable tax relief firm may dramatically reduce the stress and financial burden of unpaid taxes, but that relief comes at a cost. Tax relief companies will offer a free consultation, but the actual tax relief service will often cost you up to several thousand dollars. That’s why so many of the best tax relief companies have minimum debt limits to ensure that you don’t lose more money paying them than you gain in tax relief programs.
How We Rated the Top Tax Resolution Services
When you’re under pressure for tax debt, it can be extremely difficult to avoid tax relief scams. Finding reputable tax relief companies can be a challenge, but several factors may help you identify legitimate tax debt relief companies. We’ve scoured the market to find the best tax relief companies, but it’s always a good idea to do some research on your own using the same criteria that we did.
Accreditation
According to the Federal Trade Commission (FTC),only tax professionalscan work on your behalf with the IRS. Tax professionals include:
- Tax attorneys
- Certified public accountants (CPAs)
- Enrolled agents
In addition to working with certified tax professionals, look for tax debt relief companies that are members of tax-related associations or boards, such as:
- The National Association of Tax Professionals (NATP)
- The National Association of Enrolled Agents (NAEA)
- The American Society of Tax Problem Solvers (ASTPS)
- The American Institute of Certified Public Accountants (AICPA)
While not necessary for operations, these certifications indicate that the tax relief company takes its job seriously and values its reputation in the tax relief industry.
In general, it’s always a good idea to look for businesses registered with the Better Business Bureau (BBB) and the Bureau of Consumer Protection. The Better Business Bureau issues a rating that outlines how well the tax relief company deals with consumer complaints and its overall reputability and customer service. Avoid companies that have a rating of B or lower.
Minimum Tax Debt Required
Many federal and state tax relief services require a minimum debt amount before taking on new customers. This minimum tax debt helps keep potential customers from paying more for tax relief solutions than they get in return.
The current industry standard is a minimum tax debt of $10,000. Since no reputable tax relief company will claim to get rid of the entire debt, it’s likely that you’ll only get a small amount of debt relief. If you’re paying $2,000 for the tax relief service, the chances are that you won’t see any difference in your overall financial situation.
Most tax relief firms will state their minimum debt level requirement on their website or discuss it during the free consultation to determine if you’re eligible for relief for state or federal taxes.
Types of Tax Relief Programs Offered
The IRS offers several different ways to relieve tax debt, and the best tax relief companies are those that offer the same suite of services. Every tax solution will require a unique approach, so it’s worthwhile to work with a tax professional with all the necessary tools to get the best possible results.
Some tax relief companies also provide other tax-related services, such as tax preparation services, tax audit representation, and even bookkeeping and accounting services. It’s up to you whether you want to work with a dedicated tax relief company or whether you want the company to handle all of your tax-related issues.
Reviews
Finding the best tax relief company can be a challenge, but customer reviews can help you weed out scams. Make sure to look at recent reviews, as some companies start to coast on their reputations and stop delivering high-quality service.
Avoid taking one or two very positive or negative reviews as indicators of the company’s overall performance. Instead, look at trends in customer reviews: Are most people satisfied with their service, or are there multiple complaints? Also, look at various sites and don’t rely on the company’s website alone.
Costs
The unfortunate truth is that tax relief is an expensive proposition with at least two potentially expensive fees: discovery or investigation fees that are within the few hundred-dollar range and resolution fees that can climb up to thousands of dollars.
Very few tax relief companies disclose their costs up front, and you’ll have to schedule a free consultation to get an estimate of what they will charge you. While tax relief rates are usually quite expensive, many of the best tax relief companies will work with you to develop a payment plan to avoid more financial pressure.
Look for companies that offer a money-back guarantee, but be aware that these guarantees come with a lot of fine print. Typically, companies offer a 14-day money-back guarantee, which you have to claim within 14 days of starting their service. Also, most tax relief companies will only refund the investigation fee while keeping the significantly higher resolution fee.
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Common Problems a Tax Relief Company Can Help With
Tax Settlement
The main challenge facing many taxpayers, especially small business owners and sole proprietors, is finding the cash to pay their IRS settlement on time.
Tax relief companies may be able to help you reach an installment agreement with the IRS that will make paying off your tax debt more manageable.
Wage Garnishments
One way the IRS can get money from you is through wage garnishments, where it legally withholds funds from your paycheck to pay off your debt.
Tax Liens
While credit bureaus no longer include tax liens on your credit report, such liens can still have a huge impact on your financial wellbeing by limiting your ability to sell your assets.
Essentially, a lien attaches to all your assets, giving the IRS first claim if it seizes the assets due to non-payment of your tax debt through tax levies. Tax liens remain in place until you pay your tax bill or the statute of limitations on the debt expires.
Back Taxes
Back taxes are any unpaid taxes for a particular financial year. You may incur back taxes by failing to pay your taxes, failing to file a return, not paying associated penalties, and even failing to report all your income for the tax year.
Back taxes will incur penalties and interest every year, so it’s in your best interest to pay them off as soon as possible, either through installment agreements or as a lump sum.
Types of Tax Debt Relief Programs
IRS tax relief programs address different types of tax debt and help you find a reasonable way to pay your state or federal taxes. The best tax relief companies are those that will understand your situation, find a suitable program, and then negotiate with the IRS on your behalf.
Offers-in-Compromise
An offer-in-compromise is a solution where you offer a compromise to settle your tax debt for a lower amount than what you owe. If you can demonstrate that paying off the full tax debt would cause you financial hardship or that you’re not in a position to pay it off at all, an offer-in-compromise can make it possible for you to still pay off the tax debt you can afford.
If you apply for an offer-in-compromise, the IRS will evaluate your financial documents, including your income, expenses, assets, and ability to pay off your debt. It will come up with a compromise payment that is more reasonable and that you should be able to pay off without resorting to neglecting other payments.
Innocent Spouse Relief
In some instances, you may not be the one responsible for incurring the tax debt. If your spouse or former spouse is responsible for the tax debt, you may apply for innocent spouse relief.
When you apply for innocent spouse relief, the IRS will investigate the situation and evaluate the circumstances behind the tax debt. If it determines that paying the debt would be unfair for you and that it’s your spouse’s responsibility instead, it will remove your liability for the tax debt.
Installment Agreement
An installment agreement spreads out your IRS tax debt over several monthly payments instead of a one-time payment. An installment agreement is a great way to reduce the financial burden of a large lump-sum payment, but be aware that installment agreements don’t protect you from having to pay interest, meaning that you’ll eventually pay more than your initial tax debt amount.
Penalty Abatement
The IRS uses hefty penalties to punish individuals who don’t pay their taxes on time or who misreport their tax liability. The three main penalties the IRS uses include:
- Failure to pay: the penalty for not paying taxes on time
- Failure to file: the penalty for not filing a tax return on time
- Failure to deposit: the penalty for businesses that don’t pay employment taxes on time
The good news is that the IRS also has several ways to reduce or abate these common penalties. Reasons for penalty abatement include:
- An error that was a result of incorrect IRS advice
- Some statutory exclusions for tax payments, such as disaster relief
- Reasonable causes such as listening to incorrect advice from a tax professional
Getting a penalty abatement for these reasons can be extremely challenging, since it requires providing lots of evidence that your failure to pay or file was due to reasons beyond your control and not willful neglect.
While the IRS uses harsh penalties to enforce compliance, it also understands that people make mistakes. The First-Time Penalty Abatement (FTA) is available to anyone with a failure to file, failure to pay, or failure to deposit penalty for one tax period if you have a clean compliance history for the prior three years.
The FTA is the easiest penalty abatement option to use to lower your IRS tax debt and the one most likely to succeed if you meet the required qualification criteria.
Currently Not Collectible
The “currently not collectible” tax relief solution is a payment deferment that you may get if you can prove that you don’t have the necessary funds to pay your IRS debt.
If you succeed, the IRS will stop trying to collect your current tax debt, but it won’t erase it. Instead, it will perform an annual review of your finances. Once you have the necessary income to pay the tax debt, the IRS will expect you to start paying it back immediately.
Other Services that Tax Relief Companies Offer
Many tax relief companies employ a wide range of tax professionals, which means that they can offer a host of tax solutions for individuals and small businesses in addition to tax relief.
One advantage of working with a tax relief company that offers these additional tax services is that you essentially get to develop a relationship with the company that will help you with tax relief. This relationship will get you out of trouble with your IRS debt and ensure that you comply with tax laws in the future to avoid further mistakes and additional tax debt.
Tax Preparation Services
Tax preparation services encompass all the aspects of getting ready for a tax return. These services help you prepare for your state and federal tax filings or even payroll taxes while avoiding potentially costly mistakes during your tax return.
Tax preparation can also handle your bookkeeping and accounting, making filing a tax return significantly simpler and less stressful.
Unfiled Back Taxes
The IRS charges hefty penalties for missed filings, which can significantly affect your overall tax burden. The best tax relief companies will help you with tax preparation to avoid missed deadlines but can also file your back taxes and help minimize the penalties you’ll need to pay.
Tax Audit Defense
An IRS audit is an extremely stressful event for any individual or business. Not only do you need to explain your tax return, but you also need to attend audit meetings and deal with the financial impact of the tax audit.
Having a dedicated audit defense team can greatly reduce the stress and work associated with an audit. Instead of having to deal with the IRS yourself, you get the benefit of your defense team’s tax expertise while also letting them handle the time-consuming tasks associated with a tax audit.
Frequently Asked Questions
How Much Do IRS Tax Debt Relief Services Cost?
Unfortunately, tax debt relief isn’t cheap. Most tax debt relief companies charge two fees for their services: an investigation fee to cover the work associated with gathering your financial information and developing a tax relief strategy and a resolution fee to implement the strategy and reduce your tax debt.
In general, you can expect to pay around $200–500 for the investigation fee, depending on the tax debt relief company. The resolution fee may range between $2,000 and $5,000, depending on the nature and scope of your tax debt relief requirements.
If you have a complex and challenging tax relief case, you can expect to pay on the higher end of the spectrum.
These high fees are why so many tax relief services have a free consultation and minimum IRS debt threshold. Unless you have significant tax debt, the fees you pay will often outstrip the tax relief benefits you receive. Make good use of your free consultation to get a comprehensive quote and decide whether working with a tax relief company is the right solution for you.
What Can Tax Resolution Companies Help With?
The best tax relief companies are those that offer a range of services to help with any tax debt-related issues you face, including:
- Tax settlement
- Wage garnishments
- Federal tax lien
- Back taxes and penalties
Can Tax Relief Companies Help with State Taxes?
Yes, most tax relief companies have experience in both federal and state tax law and can help you with either. If you’re not sure whether your chosen company has the necessary experience in state tax law, make sure to ask in your free consultation.
What Is the IRS Fresh Start Program?
The IRS Fresh Start program is a way for individuals to work with the IRS to pay off their tax debts. The program consists of several tax solutions, including:
- Installment agreements
- “Currently not collectible” agreements
- Penalty abatements
- Innocent spouse relief
- Offers-in-compromise
The program’s main purpose is to make it easier for individuals or small businesses to contact the IRS about their tax debt without relying on tax relief companies.
While tax relief companies can simplify the process, thanks to the Fresh Start Program, you can find a solution for your IRS debt without the need for a third party.
Does Tax Relief Really Work?
The IRS has a vested interest in collecting as many taxes as possible, even if that requires working with the taxpayer to find an acceptable compromise.
Thanks to the IRS Fresh Start Program, individuals and small businesses can contact the IRS if they experience difficulty in paying their taxes. However, while the program has made it possible to work with the IRS, it still requires a lot of effort and time to obtain tax relief, and there’s no guarantee that you’ll succeed.
Tax debt relief organizations remove much of the stress and effort involved in seeking tax relief from the IRS. These companies understand tax laws and have plenty of experience filing and negotiating tax relief.
However, no company can 100% guarantee that they’ll succeed, which is why so many offer a 14-day money-back guarantee. These money-back guarantees can give you the peace of mind that you won’t waste all your money on a service that doesn’t produce results.
Final Thoughts
Failing to pay your taxes on time can have massive consequences on your financial situation. The IRS often imposes large penalties on late payments or unfiled taxes, making the burden even greater and more difficult to manage.
Working with a tax relief company may reduce your stress in obtaining tax relief. These companies can identify the right strategy that works for your situation, and they have the necessary experience to communicate and negotiate with the IRS on your behalf.
Unfortunately, the industry is also rife with scammers that will take your money without providing any tax relief service at all. We’ve weeded through hundreds of services to find the most reputable tax relief companies that make realistic promises and put their customers first.
While working with a tax relief company may not be the right option for every individual, our list is a great starting point if you’re looking for solid, reliable options.
* This article is provided by an advertiser and not necessarily written by a financial advisor. Investors should do their own research on products and services and contact a financial advisor before opening accounts or moving money. Individual results will vary. Foreign companies and investment opportunities may not provide the same safeguards as U.S. companies. Before engaging with a company, research the laws and the regulations around that service, and make certain the company is in compliance. For comprehensive guidance on U.S. investments and financial regulations, visit the Securities and Exchange Commission (SEC)’s Investor.gov.