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If you need tax relief, you can work directly with the IRS yourself (more about that at the bottom of this review). But if you want professional help, you can work with a tax relief company such as Jackson Hewitt's Tax Debt Resolution Service.
You may know the Jackson Hewitt name when it comes to tax preparation, but the company also has a tax relief arm that could help you with tax problems.
$1,800 on average, per the company.
Pros & Cons
Some fees lower than competitors.
Dedicated case manager who also is an enrolled agent.
Not available in Idaho, Illinois, Maine, Minnesota, Missouri, Montana, New Hampshire, North Dakota, Ohio and Washington.
No state tax help available in Florida, Georgia, North Carolina or Wyoming.
Compare to similar providers
Jackson Hewitt provides a wide variety of tax relief services that can help people manage their back taxes.
Discovery work runs $299 and covers investigating both your IRS and state tax issues. The company says it will also build a financial profile and check your standing with federal and state tax authorities.
Resolution work costs much more and depends on the particular tax issue, but the company says its fee for setting up installment agreements, applying for an offer in compromise or applying for Currently Not Collectible status runs about $1,800 on average. The actual fee depends on the amount you owe (which can create additional work), how many tax returns you still need to file or fix and what kind of tax resolution you’re looking for.
Like competing firms, Jackson Hewitt will connect you with a case manager who is your primary contact at the company. Unlike some of its competitors, this case manager will likely be an enrolled agent. A second person, a resolution manager, does the bulk of the work representing you before the IRS.
One important caveat with Jackson Hewitt Tax Debt Resolution Service is that it’s not available in every state — sorry, Idaho, Illinois, Maine, Minnesota, Missouri, Montana, New Hampshire, North Dakota, Ohio and Washington. In a few other states (Florida, Georgia, North Carolina and Wyoming) the service will help only with your federal tax bills, not state issues.
Jackson Hewitt Tax Debt Resolution Service is best for:
People who want to work with a national brand.
People who want their case manager to have a professional designation, as well as their resolution manager.
Jackson Hewitt Tax Debt Resolution Service at a glance
Offer in compromise applications
$2,000 - $4,000.
Currently Not Collectible status applications
$1,500 - $3,000.
Refundability of fees if IRS denies requests
Available, but somewhat limited.
Phone, email, chat and by mail.
Dedicated case manager?
Yes, most are EAs.
Jackson Hewitt Tax Debt Resolution Service features to know
Fees: If you just want to see what this is all about, Jackson Hewitt offers a free consultation. Continuing on brings a $299 discovery fee to investigate and diagnose all of your IRS and state tax issues. Should you decide to pursue resolution with Jackson Hewitt, there are many paths to go down, and the final bill varies with the size of your tax problem and the route you pursue. But the company says the average for this work is about $1,800.
Who does the work: Jackson Hewitt assigns a case manager who stays with you for the duration of the process. However, the whole thing is a virtual experience; you don’t meet with your case manager in person. A resolution manager is the one who represents you before the IRS. Both case advocates and resolution managers are required by the company to hold CPA or EA designations.
Refunds: You can get your $299 back for the discovery phase as long as you aren’t unresponsive for 30 or more days and you ask for the refund before signing on for any resolution work. If you’re not happy with the more expensive resolution work, the company says it “works to achieve another satisfactory result for the client” but stops short of saying you’ll get your money back.
Things to know about tax relief companies
Before you decide to hire a tax relief company, here are a few things to know.
Working with a tax relief company generally entails two steps:
Discovery work, which involves giving the company legal access to your tax records and information in order to learn how much you owe and understand what the problem is. Tax relief companies typically charge a fee for this.
Resolution work, which involves the tax relief company working with the IRS on your behalf to get you on an installment plan, apply for an offer in compromise to pay less than you owe, apply for Currently Not Collectible status or figure something else out. Tax relief companies typically charge a fee for this, too.
You’re not required to hire anybody
If you want to hire a tax relief company because you don’t have the time or energy to deal with a tax issue, that’s fine. But be aware that it’s not required. There are many things you can handle directly with the IRS to get back on track without having to pay a third party. Some of those things include:
You’re still responsible
Three things here:
Your tax bill doesn’t become the tax relief company’s tax bill. The IRS will still look to you for answers (and money), even if the tax relief company loses your paperwork, misses a deadline or screws something up.
The tax relief company can ask the IRS for a break on your behalf, but that doesn’t mean you’ll get one. The IRS denies more than half of all applications for an offer in compromise, for example. You may still have to pay the tax relief company, on top of your tax bill, even if the IRS denies the request or gives you just a tiny break.
Take a minute and do some math. Compare the amount you’re hoping to save to the amount you may need to pay the tax relief company. For example, if you end up paying a tax relief company $2,000 to reduce your IRS bill by $2,000, you haven’t saved any money.
Is Jackson Hewitt right for you?
Jackson Hewitt Tax Debt Resolution Service can handle many common tax relief needs, and at a better price than some competitors. However, it’s not available in every state, and if it’s a lawyer you want to handle your case, you may need to look elsewhere.