Private Tax Debt Collection

IRS To Use Private Debts Collectors

In the spring of 2017, the IRS will begin outsourcing the collection of not all, but some, overdue federal tax debts to private contractors. In early December of 2015, President Obama signed into law the Fixing America’s Surface Transportation Act, or “FAST Act.” The FAST Act provides funding for transportation project over the next ten years. Of course, any bill related to highways is likely to include provisions requiring the IRS to use private debt collection companies, which this bill, in fact, includes.

IRS Is Outsourcing Tax Debt Collection: Good News Or Bad News?

In September of 2016, the Internal Revenue Service announced that it plans to begin outsourcing the collection of some overdue federal tax debts in the spring of 2017 to private contractors, and has contracted with four collection outfits to implement this new program.

Authorized under a federal law enacted by Congress last December, the new program enables the following designated contractors to collect, on the government’s behalf, outstanding inactive tax receivables. As a condition of receiving this contract, these agencies must respect taxpayer rights, which includes observing the consumer protection provisions of the Fair Debt Collection Practices Act.