Consumer ProtectionNovember 11, 2011

Tax Resolution Companies Using Sales Consultants—Why They Always Fail

Elizabeth Gonsalves, Esq.

Elizabeth Gonsalves, Esq.

Tax Attorney · Los Angeles

The Sales Model vs. the Law Firm Model

There are two fundamentally different approaches to tax resolution. In the sales model, unlicensed sales consultants are the first point of contact with prospective clients. They make promises about what can be achieved, quote fees, and bring clients aboard—all before a licensed professional has reviewed a single document. In the law firm model, a licensed attorney evaluates your situation before any commitments are made.

This distinction matters more than most people realize. A sales consultant has no fiduciary duty to you. They are compensated based on volume—the more clients they sign, the more they earn. Their incentive is to tell you what you want to hear, not what you need to know.

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Unrealistic Promises and Inflated Fees

The most common tactic I see from these companies is the promise of an Offer in Compromise—settling your tax debt for pennies on the dollar. What they don’t tell you is that the IRS accepts fewer than 40 percent of all offers submitted, and eligibility depends on a detailed financial analysis that cannot be conducted during a sales call.

Commission-based compensation also inflates fees. When a significant portion of your retainer goes to the salesperson who signed you up rather than the professional handling your case, you’re paying for marketing, not legal work. I’ve seen clients who paid $5,000 to $15,000 to these companies and received almost nothing in return.

When it comes to tax controversy, early action isn't just advisable—it's the single most important factor in determining your outcome.

Elizabeth Gonsalves, Esq.

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How to Identify Legitimate Tax Representation

Legitimate tax professionals share several characteristics. They will review your documents before quoting a fee. They will give you an honest assessment of your options, including the possibility that an Offer in Compromise may not be right for your situation. They hold professional licenses—attorney, CPA, or enrolled agent—and carry the ethical obligations that come with those credentials.

Ask direct questions before hiring anyone: Who will actually work on my case? What are your credentials? Can you explain my options based on my specific financial situation? If the answers are vague, or if the person you’re speaking with can’t explain the tax code provisions that apply to your case, that’s a clear warning sign.

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Why I Built a Different Kind of Practice

I started my firm specifically because I saw how badly these companies serve taxpayers. Every client who contacts my office will speak directly with me and my team. I am personally involved in every case, supported by experienced attorneys and staff who share my standards. Our reputation is built on results, not sales volume—and that’s the way it should be.

If you’ve already been burned by a tax resolution company, know that you have options. The work may not have been done correctly, and a qualified attorney can often achieve what those companies could not.

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Questions About Your Situation?

Every tax matter is unique. A confidential consultation is the most effective way to understand your options and chart a path forward.

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