How Legitimate Is Your Tax Strategist?


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I have a new client who was a victim of one of these “tax strategy” companies that charge huge fees and don’t sign returns. In this particular case, the “tax strategy” company just folded up their tent and ran away. Now my client is left trying to sort out the aftermath. Unfortunately, I think the big fee that they paid to this company is the least of their troubles.

How do you know whether the person giving you tax advice is a shyster or a strategist?

Here are the problems that I saw from this guy touting himself as a “tax doctor”.

(1) He charged based on a percentage of savings. PROBLEM: Professionals are prohibited from doing that. In fact, I can’t guarantee savings from my tax strategies either. SOLUTION: I offer free review of your tax situation, tell you the estimated savings and then you determine if you want to move forward. I ALWAYS make sure the amount of the estimate is less than the savings you actually get so I get happy clients. (That’s always my goal)

(2) He set up multiple C Corporations with the same ownership. PROBLEM: If you have C Corporations with the same ownership, you have a controlled group. That means that you have to aggregate all of the income together for tax purposes. There is no tax savings. SOLUTION: A C Corporation is a great tool. But, so is an S Corporation, an LLC owned by a pension and over 95 other strategies I use when I review a client’s information. Sadly, a lot of these shysters use C Corporations incorrectly and it makes other CPA wary of using them at all. The answer is in the middle – use them, but use them right.

(3) He didn’t prepare the returns. PROBLEM If the guy giving you the advice doesn’t sign the return, he’s not willing to put his name on the line. SOLUTION We want to work with you beyond the initial strategy. We are there through the implementation process and we are there for the completion, which is filing the return with the huge savings. If any of these steps are not done correctly, you put your whole tax strategy at risk.

(4) He wasn’t even a tax strategist. In fact, our super sleuth Megan found him on the Internet selling weight loss plans now. From Tax Doc to Weight Doc! SOLUTION Ask for credentials. If the person giving you tax advice doesn’t have specialized tax training, and the initials to prove it (CPA, JD, EA), then move on. Bad advice can hurt you, a lot.



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