Skip to: Content
Skip to: Site Navigation
Skip to: Search


Bankruptcy for TaxMasters, an IRS foe

Bankruptcy filing by TaxMasters puts focus on its aggressive ads. The Houston firm filed for bankruptcy after Texas' attorney general sued it for misleading advertising, .

By Associated Press / March 19, 2012

Attorney General of Texas Greg Abbott, shown here in a 2005 file photo in Washington, has sued Houston firm TaxMasters for misleading ads. This week, TaxMasters filed for Chapter 11 bankruptcy.

Larry Downing/Reuters/File

Enlarge

HOUSTON

TaxMasters Inc. has filed for bankruptcy protection following a legal challenge from Texas prosecutors who say the company's famed TV commercials mislead potential customers.

Skip to next paragraph

The Houston-based tax resolution company filed Chapter 11 reorganization documents in federal court on Sunday.

The filing says TaxMasters has assets of less than $50,000 and estimated liabilities of $1 million to $10 million.

Company founder and president Patrick Cox fronts the company's national advertising campaign.

KHOU-TV says Texas is suing TaxMasters for violating the Texas Deceptive Trade Practices Act. It says TaxMaster commercials encourage people to call for a free consultation with a tax specialist but the calls are answered by salespeople unqualified to provide tax advice.

A TaxMasters spokesman and attorney did not immediately respond to calls for comment Monday.

RELATED: Do you need tax software? Five questions to ask.

Read Comments

View reader comments | Comment on this story

  • Weekly review of global news and ideas
  • Balanced, insightful and trustworthy
  • Subscribe in print or digital

Special Offer

 

Doing Good

 

What happens when ordinary people decide to pay it forward? Extraordinary change...

Endeavor Global, cofounded by Linda Rottenberg (here at the nonprofit’s headquarters in New York), helps entrepreneurs in emerging markets.

Linda Rottenberg helps people pursue dreams – and create thousands of jobs

She's chief executive of Endeavor Global, a nonprofit group that gives a leg up to budding entrepreneurs.

 
 
Become a fan! Follow us! Google+ YouTube See our feeds!