Tax scams have increased in number in the last few years, leaving thousands of taxpayers vulnerable to fraudsters. Busting of scam tax relief companies namely American Tax Relief, Roni Deutch and Tax Masters raise questions about how deep scams concerning taxes really are.

Scams of Tax Relief Companies

After the above mentioned tax relief companies were exposed of unethical practices, facts about how they ran tax relief scams came to light. Hidden fee, deceptive advertising and false promises were some of the ways they used to dupe taxpayers into paying large sums for their services. After pocketing a hefty up-front fee, fraudulent tax relief companies did little to nothing to resolve a case.

To lure taxpayers into hiring their services, they used deceptive advertising and twisted facts to suit them. These companies abused IRS tax debt payment program Offer in Compromise to dupe thousands of American taxpayers. Fully knowing that qualifying for this program is difficult, they promised every taxpayer who would hire their services tax debt reduction, sometimes even up to zero.

Busted Tax Relief Scams

When tax relief scam of American Tax Relief was busted, it was found they had made $60 million by duping innocent taxpayers.

Roni Deutch landed in court after continuous consumer complaints that led the state of California to slap a $34 million lawsuit against her. She was charged with misleading advertising and pressure sales techniques. After her fraud was exposed, she closed her law practice and resigned from the California State Bar.

Tax Masters committed over 110,000 violations of the Texas Deceptive Trade Practices Act. The company was ordered to pay $195 million to the defendants. To escape punishment, Tax Masters file for bankruptcy just before the jury trial was to begin.

Taxpayers are advised to research the tax resolution company they are looking to hire. Although most companies are fair, it is better to check the credentials of the company you choose to hire to stay safe from tax scams.