Tax Companies & Consultants

In tonight’s Local 2 Investigation, we’re talking about recovery companies.  These are businesses that pay tax offices all across the state (larger outfits do this nationwide) for public information on who has overpaid taxes and who may be missing out for not filing a homestead exemption.

They then take the data to contact taxpayers to let them know they are due money. The only catch is that the company won’t tell you the source of the windfall until you sign a contract agreeing to give them a cut.

Recovery companies should not be confused with tax consultants.  Tax consultants are the men and women who are licenesd to (among other things) help homeowners protest their taxes. You’ve seen the ads for places like O’Connor & Associates.

What I learned in researching this story is it’s pretty common in the tax consultanting industry to sign customers up with “evergreen” contracts.

For example,  if you hired a tax conultant to protest your taxes on your behalf in 2007, some contracts say they will protest your taxes every year after and charge you a percentage of what they saved you unless and until you send a written cancellation.   Yikes!

Always read the fine print in any contract you sign.

Pat O’Dell with the Harris County Appraisal District also told me when you sign a contract with a tax consultant, you are appointing them as your agent to represent you before the Appraisal Review Board.  If you no longer want them to serve as your agent, you should send a letter to HCAD (or your appraisal district) to request that they take the consultant’s name off of your account.

Also, unlike recovery companies, tax consultants are licensed with the Texas Department of Licensing and Regulation.  You can look up any tax consultant to make sure they are licensed and find out if they’ve ever been disciplined by the state.

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2 Responses

  1. Great post. I will read your posts frequently. Added you to the RSS reader.

  2. hi
    i am currently fighting propery tax values and i think you should do a story on the process .. there are 2 hearings, one informal and the other formal .. if at the informal hearing they offer you a reduced rate and you decline that offer, you then start all over again with a formal hearing .. the lower amount is not longer offered .. as a matter of interest, the hcad employee actually threatens you with the fact that you might end up paying more instead of just taking their offer … it seems funny to me that the system would work like this …

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