Tax Relief Industry

Tax Resolution Services in the Great Recession

I have been in the tax resolution industry since 1997, so I have seen quite a few business cycles. Our business dipped in 2001 - 2002, surged from 2005 to 2007 and dipped in 2008 to the present. Washington Tax Services is viable and healthy but we are still about 35% off of peak volumes. What's the difference? How are tax resolution services affected by the economy? At a cocktail party, someone might say "well, your business must be up!" Why are they wrong?

I would say the biggest reason for the decline is the REDUCED AVAILABILITY OF CREDIT. In the old days, we would find a NON-FILER of many years who the IRS was after. This person usually owned a house -- appreciating in value 10% a year -- with credit cards full of large amounts of available credit. These folks had no qualms with paying a big representation fee and full tax preparation services -- just pull out the credit card. Funny to say -- these folks were commonly people who delayed at giving us info and wouldn't get us info unless they got levied (!).

Nonetheless, today, that credit has dried up! Economically, for our country, it's probably for the best. (If anybody thinks that 2005 to 2007 should be the economic norm in this country, they are deluded -- it was a housing bubble credit binge that we might not ever see again in our lifetimes). However, we are finding that clients have to pay our fee over a longer stretch of time. My average representation fee last year was $1200.00. I have reduced my fees as well.

The other big reason, tax resolution services are reduced IS: people are filing bankruptcy on their taxes and their other debts! Or, they're dealing with foreclosure issues which are, naturally, a priority to them over tax issues.

Jay Freeborne, Washington Tax Services

Is 2024 the year to solve your tax issue? WATAX is ready to assist you now. Please call us at 1-888-282-4697 or email us a description of your tax issue and we'll contact you promptly.

Contact Us