What you should know about the IRS using private collectors

Income Tax Form
Detail view of an Income Tax form about to be completed

If you have debt with the IRS that’s more than two years old, you may soon get a letter from the agency that your account is being transferred to a private debt collector.

This change is part of a new program that only applies to taxpayers who have had an IRS debt for years, and who were previously contacted about it by the IRS.

In a press release, the IRS said the private collection agencies will work on accounts where taxpayers owe money,. The agency pointed to multiple factors  that contributed to the them assigning the accounts to private collection agencies, including older, overdue tax accounts or lack of resources preventing the IRS from working the cases.

If your debt is put into the program, you will get two letters. The first letter  will come from the IRS and inform you which private debt collection company your account has been assigned to. The companies are CBE Group of Cedar Falls, Iowa; Conserve of Fairport, N.Y.; Performant of Livermore, Calif.; and Pioneer of Horseheads, N.Y. The second letter will come from the private debt collection company assigned to your account. Both letters will include the tax amount owed, the name of the private debt collection company assigned, and a taxpayer authentication number that is unique to you.

The private firms will be authorized to discuss payment options, including setting up payment agreements with taxpayers. But, all tax payments must be made either electronically or by check, to the IRS.

But, if you’re wondering how you can tell if a scammer is calling instead, here are some tips:

  • The private debt collectors working with the IRS will never ask you to pay them directly. Instead, they’ll tell you to pay electronically at IRS.gov/payments, or send a check, made out to the US Treasury, directly to the IRS. Anyone who says they’re collecting for the IRS and asks you to make a payment over the phone is a scammer.  Whether they’re asking you to pay by credit or debit card, electronic check, wiring money, or a prepaid or gift card – don’t do it.

“The people included in the private collection program typically already know they have a tax issue. If you get a call from someone saying they’re from one of these groups and you’ve paid your taxes, that’s a sure sign of a scam,” said IRS Commissioner John Koskinen.

  • The debt collectors will never use robocalls or pre-recorded messages.
  • They’ll always use the authentication number that was in your letters.

Plus, private firms are not authorized to take enforcement actions against taxpayers. Only IRS employees can take these actions, such as filing a notice of Federal Tax Lien or issuing a levy.

If taxpayers are unsure if they have an unpaid tax debt from a previous year – which is what the private collection firms will handle – they can go to IRS.gov and check their account balance: www.irs.gov/balancedue. For more information on the program, visit the IRS webpage.

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