The Checkout

IRS Revoking Tax-Exempt Status of Credit Counseling Firms

The Internal Revenue Service is planning to revoke the tax-exempt status of every one of the 41 credit-counseling organizations on which it has completed an audit, saying many of these firms appeared to be primarily motivated by profit, not by helping debt-burdened consumers.

IRS Commissioner Mark W. Everson also said the agency had begun criminal investigations of some of the firms but declined to elaborate. Another 22 firms are still undergoing audits, part of a three-year-old crackdown on the credit-counseling industry that was sparked by hundreds of consumer complaints of deceptive business practices, including high fees, high-pressure tactics and inadequate educational services.

For more details, read my story in today's Post.

By  |  May 16, 2006; 12:12 PM ET Consumer News
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Comments

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It's about time! Will these firms have to repay taxes? I also hope that the list of these firms is highly publicized.

Posted by: Elle | May 16, 2006 3:34 PM

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