The IRS is Privatizing Debt Collection
Authored By: Legal Aid Services of Oklahoma, Inc.
The IRS will soon begin assigning some overdue federal tax debts to private companies for debt collection. Congress authorized this action in December 2015, as it has been in years past, to enable certain companies to collect outstanding, inactive tax debt on behalf of the government. In fact, Section 32102 of the Fixing America’s Surface Transportation Act (FAST Act) requires the IRS to use private collection agencies for the collection of outstanding inactive tax receivables.
If your account is assigned to a Private Collection Agency, you'll get a letter in the mail that looks like this letter.
Private Collection Agencies Selected
The IRS will assign cases to these private collection agencies:
Fairport, New York
Horseheads, New York
Cedar Falls, Iowa
If you do not wish to work with the assigned private collection agency to settle your overdue tax account, you must submit a request in writing to the private collection agency.
Beware of Tax Collection Scams
The IRS will do everything it can do to help you avoid confusion and ensure you understand your rights and tax responsibilities when it assigns your case to a private collection agency. This is particularly important in light of continuing scams where callers impersonate IRS agents and request immediate payment.
Even with private debt collection, you shouldn’t receive unexpected phone calls from the IRS demanding payment. When people owe tax, the IRS always sends several collection notices through the mail before making phone calls.
Problem or Complaint? Report it to the TIGTA Hotline
To make a complaint about a private collection agency or report misconduct by its employee, call the TIGTA hotline at 800-366-4484 or visit www.tigta.gov or write to:
Treasury Inspector General for Tax Administration
Post Office Box 589
Ben Franklin Station
Washington, DC 20044-0589
To report a threat, assault or attempted assault by a private collection agency employee, contact the TIGTA Office of Investigations with responsibility for your geographic area.
Do you have a Tax Collection Problem?
Legal Aid has a Taxpayer Clinic to help low income people with all kinds of tax problems. Legal Aid does not prepare tax returns.
If you owe back taxes or are having a tax-related problem, call Legal Aid's Low Income Taxpayer Clinic to see if we can help you.