Tax Help Offices Shut Down Pending Lawsuit

Lawsuit Seeks $58 Million In Damages

A company that claims to help people at tax time has been shut down across Indiana pending a class-action lawsuit.

A Marion County judge ordered JK Harris and Company locations in Bloomington, Evansville, Fort Wayne, Indianapolis, Lafayette and South Bend be closed after representatives failed to show up for a court hearing, 6News' Rafael Sanchez reported.

The judge also levied a $10,000 fine against the South Carolina-based company that attorney Chad Wuertz said is behind a series of deceptive and misleading television commercials.

He's seeking $58 million in damages on behalf of his client, Ron Sandlin, of Indianapolis, and others who he said have been hurt by the company.

Sandlin and Wuertz take issue with JK Harris and Company's handling of program by the Internal Revenue Service that allows those who cannot repay tax debt to reduce what they owe to pennies on the dollar.

"They make it appear as though it's something done routinely, when, in fact, that's not the case," Wuertz said.

Wuertz's client pushed for a lawsuit after he said he paid JK Harris and Company $4,500 in 2006 to deal with a tax debt of more than $29,000 and saw no results.

In a recent court filing, JK Harris and Company is sought a motion to dismiss, claiming that their contracts call for disputes to be handled through binding arbitration, not a court.

A spokeswoman told 6News on Thursday that the company is confident its Indiana offices will reopen.

"Due to the pending hearing on Feb. 22, I cannot divulge details of this client's case at this time," said Gina Anton, director of corporate communications, in a statement. "I would like to reassure our clients in the Indianapolis area that JK Harris is not going anywhere, and they can contact any of their case representatives for assistance."

The IRS has no oversight over such companies.

Taxpayer Advocates

The agency does have an independent group within its organization known as the Taxpayer Advocate Service that is solely focused on helping people unable to resolve a federal tax problem at no cost.

"If something is going to cause you economic harm immediately, then you can go to the Taxpayer Advocate Service and we can help," said Nina Olsen, a national taxpayer advocate. "We can take action to have it stopped, and then sort out the problem."

The criteria to be eligible for help includes experiencing economic harm or significant cost, including fees for professional representation, a delay of more than 30 days to resolve a tax issue or receiving no response or resolution to the problem by the date that was promised by the IRS.

The service does answer tax law questions or questions about returns.

Those who qualify for TAS assistance can call 877-777-4778, Monday through Friday from 8 a.m. to 8 p.m. EST.