- Regulators settled with American Tax Service for taking seventy-seven point seven million dollars from consumers.
- Defendants Terrance Selb and Tyler Bennett must surrender eight million dollars in cash and assets.
- The operation targeted veterans and seniors using deceptive mailers that impersonated official government agencies.
The Federal Trade Commission and Nevada reached a settlement with the operators of American Tax Service, a Las Vegas-based operation accused of taking at least $77.7 million from consumers while promising to reduce their tax debts.
The proposed court order requires operators Terrance Selb and Tyler Bennett to surrender $8 million in cash and additional assets. Regulators suspended the rest of the judgment because the defendants could not pay it in full.
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The settlement announced June 2, 2026, followed allegations that the company impersonated government agencies, used deceptive telemarketing and falsely promised tax debt relief for “pennies on the dollar.”
The operation ran through a network of companies. It took in at least $77.7 million from consumers since February 2022, including more than $36 million in revenue during 2024.
Older consumers and veterans were among its primary targets. The sales process often added fictitious services costing tens of thousands of dollars.
Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said the agency would pursue companies that exploit people trying to resolve tax debts.
“People trying to pay down their tax debt shouldn't have to worry about fraudsters pocketing their hard-earned money. The FTC will not hesitate to act to stop companies like ATS that target hard-working Americans with bogus debt relief services.”
The FTC’s consumer alert, issued August 13, 2026, says only the IRS or a state tax agency can decide whether a taxpayer qualifies for a relief program. Private companies cannot guarantee an outcome.
Official-looking letters pushed consumers toward sales calls
The scheme typically began with mailers designed to resemble government notices. The letters invoked the Internal Revenue Service or state tax authorities and warned recipients that officials were investigating them, had “red flagged” their accounts or labeled them “high risk.”
Some messages threatened property seizure or legal action. Recipients were pressured to call a toll-free number, where sales representatives promoted tax-resolution services.
The representatives allegedly claimed they could place consumers in government programs that either did not exist or for which the consumers did not qualify. The promised result was a settlement for “pennies on the dollar.”
Aaron D. Ford, Nevada’s attorney general, said the operators “deceptively promised tax debt relief” and “sent threats to consumers about their debts.”
The defendants included American Tax Service LLC, American Tax Solutions LLC, ATS Tax Group LLC, Elite Sales Solutions, GetaTaxLawyer.com LLC, TNT Holdings Group LLC, TNT Services Group LLC and TNT Tax Associates Inc.
Selb, identified as an operator and individual defendant, was disbarred in Minnesota in 1986. Bennett was also named as an operator and individual defendant.
Victims paid fees before receiving help
The operators allegedly used upselling to increase the cost for people already facing financial pressure. Consumers were sometimes told to stop paying tax authorities or other creditors, which could lead to defaults, penalties, added interest and damaged credit.
One retired disabled veteran used savings and retirement funds to pay nearly $10,000 in advance fees, according to the FTC. The consumer received no tax relief.
The Better Business Bureau of the Mid-South said the operation had an “F” rating with the BBB. Randy Hutchinson, the organization’s president and CEO, said “each and every one of us is a potential target” and urged consumers to question “miracle cures” for debt.
The settlement does not make the operators able to repay the full judgment. The order instead directs the cash and assets regulators recovered toward the enforcement action.
Regulators list the warning signs
The FTC’s advice focuses on conduct that should prompt consumers to stop before paying:
- An unsolicited letter or call claiming to represent the IRS or a state tax department.
- A promise to erase or sharply reduce a tax balance for “pennies on the dollar.”
- A demand for the entire fee before services begin.
- A guarantee that the taxpayer will qualify for a particular government program.
- Instructions to stop paying tax authorities or other creditors.
The agency advises consumers not to pay a full fee upfront and to avoid companies making fast or guaranteed promises. Taxpayers with debt can contact the IRS or the relevant state tax agency directly, or seek help from a reputable licensed professional.
The consumer alert also says private companies cannot determine eligibility for government tax-relief programs. That decision belongs to the IRS or a state revenue department.
The FTC and Nevada brought the case after the operators allegedly used government-like notices and threatening sales tactics at scale. The proposed judgment now places the surrendered cash and assets under the settlement terms, while the consumer warning remains active as of August 13, 2026.
