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JK Harris Goes out of Business

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By Michael Cohn
February 7, 2012

JK Harris, the tax representation firm that purported to help taxpayers sort out their problems with the Internal Revenue Service, has suspended its operations.

The firm, which has been inundated for years by customer complaints, filed for Chapter 11 bankruptcy protection last October. It has now sent home its employees and is getting ready to liquidate its assets, according to ConsumerAffairs.com.

A notice on its Web site instructs clients that on Jan. 26, 2012, the U.S. Bankruptcy Court for the District of South Carolina approved the sale of its customer records to Resolute Tax Services LLC, another tax resolution firm.

JK Harris has been sued by attorneys general in at least 18 states for not providing the services it promised clients (see Tax Debt Firm to Pay $1.5M in Restitution, Missouri AG Sues Tax Resolution Firm and JK Harris Ordered to Reimburse Texas Tax Clients). With the demise last year of another tax resolution firm, Roni Deutch, after she was sued by the California Attorney General, the tax resolution business has definitely acquired a bad reputation (see ‘Tax Lady’ Roni Deutch Closes Firm Amid Allegations). Hopefully, Resolute and any other firms that stand to inherit Harris’s business will do better by their clients.

However, the notice on Harris’s Web site sounds a word of warning for his former clients:

“If you decide to enter into a contract with Resolute, you may receive a credit of up to 50% of the amount of fees that were previously paid to JK Harris,” says the notice. “If you consent to Resolute having access to your JK Harris client file and any information that you have provided JK Harris, please print the authorization form on the link below, sign it, and mail or fax it to the number or address on the form. YOU SHOULD CONSIDER THIS OFFER VERY CAREFULLY BEFORE DECIDING TO SIGN UP FOR RESOLUTE’S TAX SERVICES. By approving this sale, the Court has in no way indicated that you should enter into a contract with Resolute. You are not obligated to engage Resolute for any tax services by returning the form. If you do not wish to have your information transferred to Resolute, please sign and submit the form promptly to the address on the form and indicate you do not wish to participate in the transfer of your records to Resolute.”

While all of this may just be standard legalese, it’s understandable that Harris’s former clients should be wary. Still, as the notice adds, tax problems with the IRS are usually time sensitive and the agency isn’t fond of delays:

“Your tax situation is a time-sensitive matter and you should act quickly to protect your taxpayer rights. Responses to the IRS, for example, usually require a response or some action within 30 days. JK Harris has been closed since the end of December and many files will have upcoming deadlines. It is imperative that all clients make a decision about future representation in their cases promptly.”

2 Comments

I am one of the owners of Resolute Tax Services which purchased the assets of JK Harris.

Under our agreement with the Federal ombudsman and the bankruptcy trustee, we can only access a former JK Harris customer's data if that former JK Harris customer gives us permission in writing or email to let us help him or her. We are not allowed to access any former JK Harris's customer data if that customer has not agreed in writing or email to let us help them.

We did not receive any of the payments made by these former customers to JK Harris.

When we offer up to a 50% discount that means we will only charge up to 1/2 of what we normally charge. Our goal is to be an ethical tax resolution company that will not over promise but will deliver on what we promise.

We are prepared to work with any customer's CPA or acountant should the customer wish us to do so.

Any former JK Harris customer who wants help can call 888-493-4024. If they leave their name, tel no and email one of our agents will call back wihin 24 hours.If they leave a preferred time to call we will call at that time.

They can also respond to our website; but becasue of the requirements of the Federal ombudsman and trustee it has a lot of legal language and many potential customers will not want to read through it adn figure it out.Basically it says the same thing about giving us permission to contact a former JK Harris customer as I ahve put in this response.

The advantage is that we have on our data base all the customers information, adn we have hired a number of former JK Harris employees so we can help them quickly, if they give us permission to help them.

Sincerely,

Garett Backman

Managing emmber Resolute Tax Services LLC, a delaware limtited liabiity company.

Posted by: Frazier | March 5, 2012 12:30 PM

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What happened to the other 50%?

And will Resolute Tax Services LLC just jack up their rates?

Is this the small businesses politicians are looking to encourage? It would be a laugh except that the customers keep getting screwed.

Posted by: tego@verizon.net | February 8, 2012 10:56 PM

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