Careful: If it sounds too good to be true ...

The daily mail and television commercials seem constantly to be offering relief for everything from obesity to delinquent taxes.

The latter has resulted in a lawsuit by the New York Consumer Affairs Department against American Tax Relief.

The suit claims the Los Angeles firm bombarded households with “junk mail” claiming it could settle delinquent tax debts for “pennies on the dollar.”

But according to the suit, many of the company’s clients paid hefty fees and received no relief.

In a separate action, a Brooklyn woman said she had paid American Tax Relief $5,000 to help resolve a $50,000 tax debt, “and they never helped me at all.”

Two years ago, the IRS warned citizens that some unscrupulous companies were charging excessive fees to people who had no chance of getting relief under its “offer-in-compromise” program.

Under that program, some element of relief is possible in situations where there is no likelihood the full amount of the debt could ever be satisfied. The IRS said that of 79,000 applications for such relief last year, only 19,000 qualified.

One California lawyer ran television commercials offering potential clients an opportunity to resolve their back taxes “without paying anything to the IRS.”

Such offers are tantalizing to desperate people. But an old admonition should come to mind: If an offer sounds too good to be true — it probably is too good to be true.

The most valuable less that can be learned from the suits is that people probably are better off seeking help from people they know right in their home communities.

Our communities have certified accountants and attorneys who are knowledgeable on such matters. These professionals don’t make pie-in-the-sky promises to lure potential clients into their offices.

They know that if they engage in unscrupulous dealings, they will be accountable to the bodies that license them to practice. And they live with the knowledge that their long-term success will hinge on the kind of service they provide their fellow citizens.

Published in Editorials on June 8, 2006 11:05 AM