Okay, so I did a couple of quests in Malkrath.
I ended up siding with that Forsworn leader as we broke out of the city, he promised I wouldn't be remembered for this but every time I go to that city a guard comes up to me and says I broke the law.

And that fine, whatever, I didn't go unnoticed, but here's the thing, the dialogue loops itself. When I click "Take me to jail" nothing happens and the dialogue loops back to the start.
I can't go to jail, I can't just keep killing the city guard and I still have quests to do in Malkrath.
Is there any console commands I can do to reset the bounty?

Oh and reloading is not an option for me.
Way too much progress will be lost.

Apart from console commands or any specific solutions I don't want any major spoilers if there are any.

Exactly the same happened to me! And I have my house in that city with all my cool stuff in it.. Sigh. And I'm on the xbox so can't really use the console. Guess I'm screwed.

I am still trying to figure this out as well. I can't reload, and every time I step foot near Malkrath, guards ambush me. I had several quests left to do and didn't even bexome Thane. I guess I will try and pay the bounty...

And I am on PS3, so no console command for me, either.

Same, and every time I kill a guard the bounty continues to go up.

I tried going backwards from that prison escape quest with the Forsworn leader yknow, hit the gate near the end and it was locked with key required, so I no clipped through it and there was no bed I could use to serve my sentence.
So that doesn't work either. :/

I hate to do this, but [Bump]... (I really need to fix this problem, I have quests to do and characters to talk to.)

two random guards attacked me aswell after the quest, (i guess the 3 that were involved) but i could just kill them without getting bounty (guess there were no witnesses tho), havent had any issues beyond that, can just talk to the other guards now and they dont think im a murder or whatever.

Okay, saw another thread and I tried this:

1. I first fast traveled to the Jarls' house's marker in Markarth, that Understone thingie.
2. I then immidiately hit the console command button and typed in "tdetect"
3. Then I walked to the nearest guard and spoke with him, the same dialogue came up.
4. I opened up console command, clicked on the guard and typed in "paycrimegold"
5. Upon which I found myself outside of the Jarl's house, I typed "tdetect" again to turn the AI back on, and the dialogue has stopped.

I mean, it's only been 2 minutes but I've talked to the guards around Markarth and it seems that the bug is fixed now.
PC users, try that, console users, pray that Bethesda fixes it in the upcoming patch.