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

  • close
    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.
    View Caption

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.

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.

Recommended: Tax advice from a computer: Do you need tax software? Five questions to ask.

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.

Share this story:
 
 
Make a Difference
Inspired? Here are some ways to make a difference on this issue.
Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.
 

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...