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DIY Tax Resolution vs. Hiring a Firm

Should you handle your IRS tax debt yourself or hire a professional tax resolution firm? Compare the costs, benefits, and risks of each approach to make the right choice for your situation.

Quick Answer

The IRS publishes an Online Payment Agreement tool for setting up a plan yourself, and Form 2848 for authorizing someone to act for you. Both routes are open for any matter -- the IRS does not require representation for anything. If cost is the obstacle, the IRS funds Low Income Taxpayer Clinics, which represent people for free or a small fee. This page does not tell you which to choose and we receive nothing either way.

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DIY Tax Resolution

Advantages

  • No professional fees - only IRS fees apply
  • Direct control over the entire process
  • Learn valuable tax knowledge
  • Can work at your own pace
  • IRS provides free resources and assistance
  • Taxpayer Advocate Service available for help
  • Online tools make some processes easier
  • Good option for straightforward cases

Disadvantages

  • Steep learning curve with complex IRS rules
  • Time-consuming paperwork and research
  • Risk of making costly mistakes
  • May miss deductions or better resolution options
  • IRS agents may not inform you of all options
  • Emotional stress of dealing with IRS directly
  • No representation if issues arise
  • Easier to under-document an OIC, which can lead to a return or rejection

Best For

Taxpayers with simple tax situations and straightforward balances, those who owe for straightforward underpayment, or those seeking streamlined installment agreements.

Typical Cost

We do not publish fee ranges for third-party representation. Costs vary by provider and by the work involved; ask any provider for their fee in writing before engaging them.

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Hiring a Tax Resolution Firm

Advantages

  • Expert knowledge of IRS procedures and regulations
  • Experience with IRS documentation requirements and deadlines
  • Handle all communication with IRS
  • Know which resolution options fit your situation
  • Proper documentation and presentation of your case
  • Can identify errors in IRS calculations
  • Representation during audits or appeals
  • Peace of mind and reduced stress
  • May negotiate better outcomes

Disadvantages

  • Professional fees can be significant
  • Quality varies widely between firms
  • Some firms make unrealistic promises
  • Less personal control over the process
  • Need to vet and choose the right firm
  • Communication delays possible
  • Not all firms are equally qualified

Best For

Taxpayers with complex situations, multiple years of unfiled returns, business tax issues, or those facing aggressive collection actions like levies and garnishments.

Typical Cost

We do not publish fee ranges for third-party representation. Costs vary by provider and by the work involved; ask any provider for their fee in writing before engaging them.

The Verdict

The IRS publishes an Online Payment Agreement tool for setting up a plan yourself, and Form 2848 for authorizing someone to act for you. Both routes are open for any matter -- the IRS does not require representation for anything. If cost is the obstacle, the IRS funds Low Income Taxpayer Clinics, which represent people for free or a small fee. This page does not tell you which to choose and we receive nothing either way.

Frequently Asked Questions

What qualifications should I look for in a tax resolution firm?
Look for firms with credentialed professionals: Enrolled Agents (EAs), CPAs, or tax attorneys. These are the only professionals authorized to represent you before the IRS. Check reviews, ask about their experience with your specific issue, and avoid firms that guarantee specific outcomes or charge fees before explaining your options.
Can I start DIY and switch to professional help later?
Yes, but it is not ideal. Starting yourself and then switching can create complications, especially if you have already submitted documents or made statements to the IRS. If you think you might need help, consulting with a professional early (many offer free consultations) is better than trying to recover from DIY mistakes.
Are tax resolution firm fees tax deductible?
Tax preparation and advice fees may be deductible as a miscellaneous itemized deduction, but with limitations since the 2017 Tax Cuts and Jobs Act. Business-related tax preparation fees remain deductible. Consult with a tax professional about your specific situation.
What percentage of OIC applications are accepted?
The IRS does not accept most offers it receives. We are not publishing a specific acceptance percentage here until we can cite the IRS dataset, year, and denominator it comes from — figures quoted around the industry frequently mix different populations and time periods. What matters more for your own odds is whether your offer amount reflects the IRS calculation of what it could collect from your income and assets. The free IRS Pre-Qualifier tool will tell you more about your situation than any published average.

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Ready to Take the Next Step?

Use our free tools to determine which option is best for your specific situation.

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Sources

Sourced to primary IRS materials and editorially reviewed. Not reviewed by a tax professional. Not tax advice. Report a correction.