Court takes action against Tax Relief Scam

A federal judge in Chicago has issued a temporary restraining order against American Tax Relief LLC for numerous deceptive practices, including false claims in TV, radio and internet ads that it can settle its customers’ delinquent federal and state income taxes for "pennies on the dollar". The company collected fees of over $60 million dollars from its customers, very few of whom qualified for any relief. For example, many were promised penalty abatements and reduced tax obligations through offers in compromise - relief that the IRS permits only in rare circumstances. Upfront fees ranged from $3,200 to $25,000. The majority of customers qualified at the most for installment payment plans that they could have arranged themselves at no cost.

Court documents reflect that the company ignored a barrage of complaints and frequently blamed the customer for failing to qualify for relief. In the meantime, the company's owners enjoyed a lavish lifestyle including a $3.4 million house and six vehicles, including a Ferrari, a Rolls Royce, a Bentley, two Porsches, and two Mercedes-Benzes.

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