by Jay Freeborne , Enrolled Agent
September 12, 2014

On the phone with a gentleman who has nearly hired Coast One Financial Group in San Diego, California - a brand new tax resolution company. They were going to charge this gentleman $3450.00 to represent him and that they were going to do a Offer in Compromise for him.

So let's look closely at his numbers to see if their claim has any merit.

Their tax situation: This person owes the IRS $31,000.00 - he's in a $395 monthly payment plan.

Their finances: He and his wife make about $11,250.00 month before taxes

Their other expenses go like this:

National Standard $1482
Housing $2200 - (within their county's parameters)
Car payment $370
Transportation expense $400
Taxes $2200
State back taxes $223
Medical expense including out of pocket and health insurance: $540.00

All totaled their monthly expenses are: $7415.00

Subtract the expenses from their income and you have about $3835 in monthly disposable income.

Conclusion : I am sorry they just don't qualify for an Offer in Compromise - they have the ability to pay back what they owe before the debt would expire and well let's be clear: this company is going to very much disappoint them. This person should remain in his installment agreement. File his 2013 return with a small balance due - and call the IRS when his balance due notice comes and reinstate the same installment agreement.

In our opinion this person should NOT hire a tax professional. UNLESS in the future he starts paying his taxes in which we can consider getting the penalties off for a nominal fee, say $750?

Background of company: Further scrutiny of Coast One Financial Group - shows a person on the BBB record: Stephanie Stubig. This person apparently ran the now defunct Progressive Tax Group and Urgent Tax Care. Both of those companies are closed and because you can't do interviews like this and survive in the long haul. Furthermore the aforementioned lady was involved with the still operating Tax Group Center. Read more here for details about these companies: Deceased company list and Not recommended companies .

Update - September 25th - on another case recently - Coast One Financial offered their services for $8900 to a person who had just very recently negotiated an installment agreement on their 100k - after working with a Revenue Officer. Revenue Officer's usually don't get these outcomes wrong. What would Coast One do for that fee? I am not sure - get penalties off - that's a big fee for not a guaranteed outcome!

For 30 years, WATAX has been solving every kind of tax problem. Call us at 1-888-282-4697 or email us a description of your tax issue and we'll contact you.

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