March 28, 2011 by Jay Freeborne

We have been blogging about the phenomenon of companies -- largely in Colorado --cold-calling consumers with tax liens against them. In our opinion, this is a tolerable activity as long as the customers are served. And as we have written here and here, there are a handful of companies that seem to run a good shop.

However, recent alarm bells that were set off by cold callers at New Century Tax Consulting, for instance, have had us reconsider our stance. "Elevated Status!" -- those are some of the buzz words that these cold callers use. And they are often very, very far off the mark. We have many people call us after coming across the tax resolution blog -- and, naturally, they were alarmed by this scare tactic. One client was already in a payment plan with the IRS -- no collection danger at all. Another client was not in collections -- his case was months away from being assigned to a Revenue Officer.

So, Publication 470 - Limited Practice Without Enrollment is the IRS Publication for people who are NOT licensed tax professionals (Enrolled Agents, CPA's, Attorneys). "Unenrolled preparer" refers to anyone who is unlicensed or unenrolled to practice before the IRS...

In Section 8. Solicitation and Advertising, it clearly states:

.01 An unenrolled preparer shall NOT make, directly or indirectly, an UNINVITED solicitation of employment, except as noted below, in matters related to the IRSSolicitation includes, but is not limited to, in-person contacts, TELEPHONE COMMUNICATIONS, and personal mailings directed to the specific circumstances unique to the recipient.  This restriction does not apply to (1) seeking new business from an existing or former client in a related matter or (2) Solicitation by mailings, the contents of which are designed for the general public.
Furthermore, .02  No unenrolled preparer shall, with respect to any IRS matter in any way use or participate in the use of any form of public communication containing, FALSE, fraudulent, misleading deceptive, unduly influencing, coercive, or unfair statement or claim....
We don't know-- but this part of Pub. 470 clearly makes the case that telemarketers/unenrolled preparers are hovering on the edges of legality.

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