Tax Company Settles Lawsuit with the State

A tax consulting company that promised to help customers settle claims with the IRS has now settled a lawsuit with the state of Texas. JK Harris and Company of South Carolina was accused of cheating customers by taking their money and then not helping with their claims as promised. Bill Stamps has more.
Commercials for JK Harris & Company touted the business as the nation’s largest tax representative company. If you owed money to the IRS they said they’d help you settle the claim.

Not only did they not help customers settle their cases, Texas Attorney General Gregg Abbott says in many instances the company never even looked at the customer’s files.

"Our investigation found that JK Harris charged customers thousands of dollars up front without actually reviewing individual tax files to see whether tax payers were actually eligible for the relief they were seeking through the offer in compromise program."

The attorney general’s office got lots of complaints from people who felt cheated. They told stories of trying to get their money back and running into a brick wall.

"When they did (call), they found that it was frequently difficult to reach the firm because the firm wasn’t answering their phone calls. In addition, JK Harris often failed or refused to return money to customers that were seeking a refund."

So the state filed a lawsuit against the company. JK Harris agreed to settle for 1.2 million dollars. 800 of that will go to cheated customers and 400 will reimburse the state for legal fees.

As part of the settlement with the state JK Harris must also change its deceptive practices and must let customers know up front that few people qualify for reduced settlements with the IRS.

For more information, visit the Texas Attorney General Website.