Skip to comments.Texas jury slaps $195 million penalty on TaxMasters, CEO Cox (files for bankruptcy)
Posted on 04/01/2012 4:44:35 PM PDT by Libloather
Texas jury slaps $195 million penalty on TaxMasters, CEO Cox
Reuters Fri, Mar 30, 2012
(Reuters) - A Texas jury voted to slap $195 million in civil penalties on Friday against the tax advisory firm TaxMasters and its CEO Patrick Cox, who were accused by the state of defrauding consumers.
Houston-based TaxMasters became a household name due to commercials featuring Cox, who promised consumers his firm could walk them through audits, settle tax disputes and recover property seized by the IRS.
It gained more dubious recognition in 2010, when Texas Attorney General Greg Abbott filed a lawsuit saying some of the company's claims were false.
TaxMasters lodged its Chapter 11 bankruptcy petition on March 19 in U.S. Bankruptcy Court in Houston, listing assets of less than $50,000 and liabilities of between $1 million and $10 million. The company said its unsecured creditors can expect to see some recovery.
(Excerpt) Read more at news.yahoo.com ...
Another lawyer hits the lottery.
Taxmasters is no different then H and H Block. All they do help you bend over to the IRS.
With assets of $50,000 I doubt anyone other than lawyers will ever see a penny.
In a bankruptcy court, administrative costs (lawyers) are the first to be paid.
When Patrick Cox said in his commercials that TaxMasters would "get between you and the IRS", I figured that the IRS didn't stand a chance, because nobody could get around that guy.
He’s a bit of an unmade bed I suppose...
That’s because no one was allowed between Cox and his food.
If my memory is correct, they did the same thing to Lonnie Deutsch in California. They give a bad rap to those of us who get in the gutter and do the real work settling the disputes with the IRS. It’s hard frustrating work at times.
He’s not a tax master, he’s an ass master....there’s a difference.
I take exception to your statement. I am a HRB seasonal tax preparer and I give good value for my service. Anybody can come see me, see what my extensive training and our software says is their tax situation and THEN decide its worth for us to file the return. We take 24 credit hours each year of minimum training to work the following tax season.
Taxmasters advertises remedial taxpayer services that is very secondary for HRB which is in the business of primary tax preparation. No body except die-hard statists likes taxes but proper intelligent tax preparation is smart and necessary to avoid the attention of the Infernal Revenue Service.
24 hours? really? in that 24 hours are they able to teach you all the changes in the tax code? Like all the changes Obamacare inflicted on us? Or is it more just training on how to use their software that is likely much like their over the counter tax software you can buy.
I do low voltage electrical work..
I need more than 24 hours of training per year to install a network run in your home from the jack to the computer.
That is something that has not changed since 10baseT networks came about over a decade ago.
Just not sure how 24 hours of training could possibly be enough to cover the massive tax code system. I have a hard enough time keeping up with local electrical codes.
Disclosure. One of my clients is a CPA.. we barter. I have never used H&R in my life.
Couldn’t have happened to aa more deserving company and CEO.
H&R Block, and Taxmasters are totally different markets!
You, competently prepare tax returns based on the client data that was provided to you.
Taxmasters, on the other hand tries to defend a client if he didn’t tell a tax preparer about some income items, or overstated his deductions, or committed fraud or non-payment for other reasons.
I’m sure that you do your job well, but Taxmasters should be an entire different level of expertise.
Nothing wrong with penalizing crooks! I don’t care who the money is transfered to. We need to do it more often. The elite have no morals.
I always suspected those guys were crooks.
Considering that it's the IRS calling them amoral crooks, I'd take that accusation with a grain of salt.
Perhaps you missed my statement about minimum training and this training is like academic courses where the hours do not count required homework. My Enrolled Agent class takes 10 3 hour sessions with a homework load of 3 hours homework for every class hour. You cannot miss more than one class and pass.
Noob1999: H&R Block, and Taxmasters are totally different markets!
Yes and this is just what I replied to ColdSteelTalon when he conflated the two organizations. Note my statement of "Taxmasters advertises remedial taxpayer services that is very secondary for HRB which is in the business of primary tax preparation." Your reply just restates what I already wrote.
I also know that the minimum is also most peoples MAXIMUM.
Thanks for the clarification. I’ll stick with my CPA.
>>>Thanks for the clarification. Ill stick with my CPA.
My brother, who until recently owned an H&R Block franchise, regularly helped CPAs with tax questions the CPA couldn’t figure out...
I also started working for HRB last year. I’m a 74 yr old retired engineer and thought I was able to do my own taxes for many years. Twice over the years I had my tax return prepared by respected CPAs they both screwed it up.
Last week I recovered over $10,000 for a client who had made common mistakes over the last 3 years. HRB’s Second look program gives people a chance to recover money they paid in error.
ALL of HRB’s services are payable ONLY when the client is satisfied with the preparation and they guarantee you the biggest refund / lowest tax liability allowable by law.
I have to agree...been using HRB for many years. Never been audited. Maximum returns. Only gripe is the price. They go up every year regardless of your income or complexity of your taxes.Now that I am retired plus fixed income, I will be doing my own taxes from now on.
what exactly did he do wrong/improper?
it has to be something substantive to have it get this far.
Mine works for barter.. I don’t care who he calls for help. I just care I get the MAXIMUM back, or minimum owed at the end of the year. And no audit.
if i do get audited I also know the professional that did my taxes will be there during the audit.
>>>if i do get audited I also know the professional that did my taxes will be there during the audit.
H&R Block does that too - part of the deal.
They send you the guy that did them. Or someone else? I want the guy who signed my 1040 there.
The one that did them.
I’ll keep it in mind. I highly doubt I could keep your desk computer running in exchange for doing my taxes.
My CPA is 80 something though... so ya never know.