Published: Mon, April 10, 2017
Health | By Kristina Bennett

U.S. tax department IRS to use private debt collectors

U.S. tax department IRS to use private debt collectors

By law, District of Columbia holidays impact tax deadlines for everyone in the same way federal holidays do. Usually, these are unpaid individual tax obligations that are not now being worked by IRS collection employees and often were assessed by the tax agency several years ago. Taxpayers can verify they have an unpaid tax debt from a previous year by visiting

An independently reviewed study by the IRS found that IRS employees are three times more efficient at collecting taxes than private tax collectors.

"The data book and its consistency year-to-year help illustrate trends over time, ranging from the increasing size of the taxpayer population to the decreasing size of the IRS workforce, " Koskinen said. Scammers often ask for payment via pre-paid debit cards, iTunes cards, other gift cards, Kalb said, which the IRS never accepts for tax payments.

In a move that could be confusing to seniors who are vulnerable to scams, the IRS will begin using private debt collection agencies to collect past-due taxes.

Transposing just one number could cause huge headaches, because the IRS makes clear on Form 8888 that it is not responsible for a lost refund if you enter incorrect account information.

The four companies the IRS has selected to handle collections are CBE, ConServe, Performant and Pioneer.

Only four firms are authorized by the IRS. The private companies will then send letters to the taxpayers before calling them. Because of this, the IRS wants to help taxpayers avoid confusion, know their rights and tax responsibilities, and know how to identify phone scams where callers impersonate the IRS or the designated debt collection agency.

NTEU represents 150,000 employees at 31 federal agencies and departments, including the IRS.

On the other hand, if you can't afford to pay your taxes and you tell the IRS, you can be put on an installment plan for up to six years. "One thing to note is that checks are not made out to the Internal Revenue Service, only to the United States Treasury". To find out more about available payment options, visit

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"Subjecting taxpayers who are struggling to make ends meet and can't afford legal representation to private contractors whose sole motivation is to maximize their own profits at the taxpayers' expense is a recipe for disaster", Reardon said. For example, you must have a net profit that you included on Schedule C, used Schedule SE to calculate your net earnings, reported your net earnings on Schedule K-1 (because you were part of a partnership) or paid insurance premiums (or had them reimbursed) as a more-than-2 percent shareholder in an S corporation.

What IRS change could cause confusion with taxpayers?

As IRS officials have noted, no new money was appropriated by Congress to operate the PCA program. Normally, your taxes need to be filed by April 15, but due to a couple of date conflicts, this year we have until April 18.

"Here's a simple rule to keep in mind".

"So some people may think, gee, I owe this year, I can't file".

For many people, getting a tax refund is like getting a handful of sand: It's virtually impossible to hang on to much of it.

If you feel your taxpayer rights have been violated or if you've fallen prey to a tax scammer, the IRS recommends registering your complaint with the Treasury Inspector General for Tax Administration.

The accounts taken up by the private collection agencies (PCAs) are chosen through several criteria including age and lack of resources preventing the agency from following up on the tax debt, IRS said.

Initial contact won't be by phone. The IRS will start by assigning cases in which the debt is less than $50,000.

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