Before Hiring Tax Help: What to Know and How to Protect Yourself

Why a Baseline Matters

Before you hire anyone to handle your tax issues, you need to know exactly where you stand. Not what you think happened. Not what a previous preparer told you. What the IRS actually has on record.

Without a documented starting point, you have no way to measure whether the person you hire actually accomplishes anything. You're trusting their word—and paying thousands of dollars based on that trust alone.

A baseline report from your IRS records establishes:

• Which tax years have returns on file
• Which years are missing or unfiled
• Current balances owed, including penalties and interest
• Active payment plans or installment agreements
• Collection activity status (liens, levies, notices)
• Statute of limitations dates for each year

This isn't about distrust. It's about accountability. Any competent tax professional will welcome a client who arrives with clear documentation of their situation.

Verify Credentials First

Not everyone advertising "tax help" is equally qualified—or qualified at all. Before signing anything or paying a fee, verify your prospective professional's credentials:

Enrolled Agents (EAs)

Licensed by the IRS to represent taxpayers in all matters. Verify status at irs.gov/tax-professionals. EAs must pass a comprehensive exam and complete continuing education. They can represent you before the IRS without restrictions.

Certified Public Accountants (CPAs)

Licensed by your state. Verify through your state's board of accountancy. Not all CPAs specialize in tax resolution—ask specifically about their IRS representation experience and how many cases similar to yours they've handled.

Tax Attorneys

Licensed by your state bar. Verify through your state bar association. Best for cases involving potential criminal liability, complex litigation, or very high amounts owed. More expensive, but sometimes necessary.

Tax Relief Companies

These are typically marketing companies that contract with EAs, CPAs, or attorneys to do the actual work. The person on the phone selling you the service is usually not the person who will handle your case. Ask who specifically will be assigned, what their credentials are, and how many cases they're currently managing.

Demand a Written Engagement Letter

Never hire a tax professional without a detailed engagement letter. This document is your contract and your protection. It should clearly specify:

• Exact tax years being addressed (e.g., "2019, 2020, 2021 individual returns")
• Specific services to be performed (filing returns, requesting penalty abatement, negotiating installment agreement, etc.)
• Timeline for completion of each action item
• Total fees and payment schedule
• Scope limitations—what is NOT included
• Communication expectations—how often they'll update you and through what channel
• Additional fees—under what circumstances will costs exceed the quoted price

If a firm refuses to provide a detailed engagement letter, walk away. This is standard professional practice, and any legitimate professional will provide one without hesitation.

Set Measurable Benchmarks

Vague promises like "we'll resolve your tax issues" are meaningless. Before hiring, establish specific, measurable benchmarks tied to your engagement letter:

Every action item in your engagement letter should have a corresponding verification method. IRS transcripts are the ultimate source of truth—they show what actually happened on your account, regardless of what anyone claims.

Red Flags to Watch For

The tax resolution industry has legitimate professionals—and it has companies that take advantage of people in stressful situations. Watch for these warning signs:

• 1.

  Guaranteed outcomes before reviewing your case

  No one can guarantee the IRS will accept an Offer in Compromise or approve penalty abatement without first analyzing your specific records.

• 2.

  Large upfront fees before doing any work

  A reasonable investigation fee is normal. $5,000-$15,000 upfront before anyone has looked at your transcripts is a red flag.

• 3.

  High-pressure sales tactics

  "This price is only available today" or "The IRS is about to seize your assets" without documentation to support urgency.

• 4.

  No written engagement letter

  If they won't put their commitments in writing, they have no intention of being held accountable.

• 5.

  Vague about who will handle your case

  You should know the name and credentials of the specific professional assigned to your case, not just the salesperson.

• 6.

  Won't explain their process

  A legitimate professional can clearly explain step-by-step what they'll do. "Trust us, we handle everything" is not a process.

How to Monitor Progress

After hiring, don't just wait and hope. Actively monitor your case:

• Request copies of everything filed — Every return, every letter to the IRS, every response. These are your documents.
• Set calendar reminders — Based on the timeline in your engagement letter, check in on each milestone.
• Check your IRS account — Create an account at IRS.gov to view your transcripts online. You can see when returns are filed and when actions are taken.
• Request progress updates — At minimum, monthly written updates on what was done, what's pending, and any changes to the plan.
• Keep all IRS notices — Forward everything you receive from the IRS to your professional immediately, but keep copies for yourself.

If months pass with no visible progress on your IRS transcripts, that's a signal something is wrong—regardless of what your tax professional tells you.

When to Walk Away

Not every professional relationship works out. Consider ending the engagement if:

• Deadlines in the engagement letter pass with no action and no explanation
• Your professional stops returning calls or responding to emails
• IRS notices continue arriving for issues that should have been addressed
• Your IRS transcripts show no changes months after work should have begun
• You're asked for additional fees beyond what was agreed without clear justification
• Your professional can't clearly explain what they've done or what's next

Before walking away, get a current PROOF report to document exactly where things stand. This becomes your evidence if you need to file a complaint with the state licensing board, the IRS Office of Professional Responsibility, or pursue a refund.

You can file complaints with:

• Your state attorney general's consumer protection division
• The IRS Office of Professional Responsibility (for enrolled agents)
• Your state board of accountancy (for CPAs)
• Your state bar association (for attorneys)
• The Better Business Bureau
• The Federal Trade Commission (for deceptive advertising)