Seriously tax-delinquent taxpayers may soon hear from someone new.
The Internal Revenue Service has awarded contracts to three private collection agencies for the collection of overdue tax debts. The new contracts began Thursday, Sept. 23, when old collection-agency contracts expired.
The three agencies are:
- CBE Group Inc., PO Box 2217, Waterloo, Iowa, 50704; (800) 910-5837;
- Coast Professional Inc., PO Box 526, Albion, New York, 14411; (888) 928-0510; and,
- ConServe, PO Box 307, Fairport, New York, 14450; (844) 853-4875.
How the IRS works with private agencies handling the collection of overdue tax debts
The IRS stressed that it always notifies a taxpayer before transferring their account to a collection agency. First, the service will send a letter to the taxpayer and their tax rep informing them that their account was assigned to a collection agency and giving the name and contact information for the agency handling the collection of overdue tax debts.
This mailing will include a copy of Publication 4518, “What You Can Expect When the IRS Assigns Your Account to a Private Collection Agency.”
The IRS says it will keep delinquent taxpayers informed regarding private agencies handling their account.
The agency will then send its own letter to the taxpayer and their representative confirming the account transfer. The collectors will identify themselves as contractors collecting taxes on behalf of the IRS.
Clients may need reminders that private firms can’t take enforcement actions against taxpayers. The collection agencies can discuss payment options, including setting up payment agreements with taxpayers. Any tax payment must go directly to the IRS.
Many taxpayers have been unhappy with payment plans initiated by the IRS
A troubling finding of a 2018 report was that taxpayers, whose tax debts were assigned to private collection agencies, entered into installment agreements that they are unable to afford, with approximately 43 percent earning income below their allowable living expenses.
It's never a good idea to try negotiating with the IRS directly. Many people do attempt this, and I know from my decades of experience they almost always completely regret it. I can't count the number of cases I've renegotiated for my clients, that did result in manageable payment plans.
Before doing anything, talk to us first!
If anyone reading this is considering going directly to the IRS to try to solve things – please think twice and talk to me or one of my team first. We can always help you with whatever's going on. Contact me by one of the methods below in the blue box, or email me at Larry@TaxProblemSolver.com and we can review your specific issues and solve them. You can also click here to book a free consultation.
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