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Home»Personal Finances»The IRS Private Debt Collection program has begun!

The IRS Private Debt Collection program has begun!

Private Debt Collection

Private Debt Collections

IRS Begins Private Debt Collections!

The New Private Debt Collection program has begun by selecting four contractors to implement it.

Authorized under the Fixing America’s Surface Transportation Act (FAST Act) it requires the IRS to use private collection agencies for the collection of outstanding inactive tax receivables.

General Information

As a condition of receiving a contract, these agencies must respect taxpayer rights including, among other things, abiding by the consumer protection provisions of the Fair Debt Collection Practices Act.

These private debt collection agencies will work on accounts where taxpayers owe money, but the IRS is no longer actively working them. Several factors contribute to the IRS assigning these accounts to private debt collection agencies, including older, overdue tax accounts or lack of resources preventing the IRS from working the cases.

Written notice will be given by the IRS to taxpayers and their representatives that the accounts are being transferred to the private debt collection agencies. The agencies will send a second, separate letter.  The private debt collection agencies must identify themselves as contractors of the IRS. Employees of these debt collection agencies must follow provisions of the Fair Debt Collection Practices Act and should be courteous and respect taxpayer rights.

In light of continual phone scams where callers impersonate IRS agents and request immediate payment, the IRS will do everything it can to avoid confusion.

Private debt collection agencies will not ask for payment on a prepaid debit, iTunes or gift card. Taxpayers will be informed about electronic payment options for taxpayers on IRS.gov/Pay Your Tax Bill. Payment by check should be payable to the U.S. Treasury and sent directly to IRS, not the private collection agency.

In order to keep taxpayers informed about scams and provide tips for protecting themselves, the IRS encourages taxpayers to visit IRS.gov for information including the “Tax Scams and Consumer Alerts” page.

Private Debt Collection Agencies Selected

The IRS will assign cases to these private debt collection agencies:

  • CBE
    P.O. Box 2217
    Waterloo, IA 50704
  • ConServe
    P.O. Box 307
    Fairport, NY 14450-0307
  • Performant
    P.O. Box 9045
    Pleasanton CA 94566-9045
  • Pioneer
    PO Box 500
    Horseheads, NY 14845

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.

Accounts Not Assigned To Private Collection Agencies

IRS will not assign accounts to private collection agencies involving taxpayers who are:

  • Deceased
  • Under the age of 18
  • In designated combat zones
  • Victims of tax-related identity theft
  • Currently under examination, litigation, criminal investigation or levy
  • Subject to pending or active offers in compromise
  • Subject to an installment agreement
  • Subject to a right of appeal
  • Classified as innocent spouse cases
  • In presidentially declared disaster areas and requesting relief from collection

Private collection agencies will return accounts to the IRS if taxpayers and their accounts fall into any of these 10 situations after assignment to the private collection agencies.

Stay Vigilant Against Scams

Be on the lookout for unexpected scam phone calls from anyone claiming to be collecting on behalf of the tax agency.

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.

TIGTA Hotline

If you have a complaint about a private collection agency or wish to 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.

Written by

James Fleming is an accountant and Certified Tax Coach with over 30 years experience working in and with small businesses. His company, Fleming Financial Solutions offers tax planning and preparation, bookkeeping, business plan writing and marketing consulting.

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