IRS Now Allows Private Debt Collectors to Dun Taxpayers
In a move that could be confusing to seniors who are vulnerable to scams, the IRS is using private debt collection agencies to collect past-due taxes. The new program began in April 2017.
Historically, scammers have posed as the IRS to target seniors to retrieve identifying information or payment. Upon until now, tax professionals have been able to reassure clients that the IRS would never harass consumers over the phone. However, under this new rule, private debt collectors may contact taxpayers by phone, which may make it more difficult to determine whether a scammer is targeting the taxpayer.
The IRS has contracted with four debt collection companies:
Conserve, located in Fairport, New York
Pioneer, located in Horseheads, New York
Performant, located in Livermore, California
CBE Group, located in Cedar Falls, Iowa
To avoid scams, remember that private collection agencies will only ask for payments to be made online at IRS.gov or by check. Checks should be made payable to the U.S. Treasury and sent directly to the IRS, not to the private collection agency. The collection agency will not ask for payment on a prepaid debit, iTune or gift card.
Rep. John Lewis, D-Ga. has introduced the Taxpayer Protection Act of 2017, which would repeal the IRS’s authority to contract with private companies to collect federal tax debts. Until it is passed, private companies will continue to work on behalf of the IRS.
Ms. MacDonald’s practice is limited to Estate Planning, Probate & Trust Administration. Ms. MacDonald maintains her practice in the Santa Clarita Valley at 25115 Avenue Stanford, Suite A-209, Valencia, California. She can be reached at 661-294-6464.
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