Consumer Alert: IRS Authorizes Four Private Companies to Collect Overdue Federal Taxes
The Tennessee Department of Commerce & Insurance’s (TDCI) Division of Consumer Affairs reminds residents that beginning April 2017, the Internal Revenue Service (IRS) plans to use four designated private agencies to collect certain overdue federal tax debts on the government’s behalf. The program was enacted by Congress in December 2015 under Section 32102 of the Fixing America’s Surface Transportation Act (FAST Act).
“Because IRS imposter scams are so prominent at this time of year, we want Tennessee consumers to be aware of which private companies have been officially authorized to collect overdue tax debts,” TDCI Consumer Protection Director Cynthia Wiel said. “Remember: these companies will never ask for payment on a prepaid debit, iTunes or gift card. Demanding that type of payment is a tactic employed by scammers.”
The IRS will assign cases to these four private collection agencies:
P.O. Box 2217
Waterloo, IA 50704
P.O. Box 307
Fairport, NY 14450-0307
P.O. Box 9045
Pleasanton CA 94566-9045
PO Box 500
Horseheads, NY 14845
The IRS will give taxpayers and their representative written notice that the accounts are being transferred to the private collection agencies. The agencies will send a second, separate letter to the taxpayer and their representative confirming this transfer.
Private collection agencies will be able to identify themselves as contractors of the IRS collecting taxes. Employees of these collection agencies must follow provisions of the Fair Debt Collection Practices Act and should be courteous and respect taxpayer rights.
The IRS states it will do everything it can to help taxpayers avoid confusion and understand their rights and tax responsibilities, particularly in light of continual phone scams where callers impersonate IRS agents and request immediate payment.
Private 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.
These private 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 collection agencies, including older, overdue tax accounts or lack of resources preventing the IRS from working the cases.
The IRS reminds consumers that it will NOT assign accounts to private collection agencies involving taxpayers who are:
- 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
Consumers who do not wish to work with the assigned private collection agency to settle your overdue tax account must submit a request in writing to the private collection agency.
For more information about the IRS’s new private debt collection program, please visit the IRS website.
For more consumer protection tips, visit the Tennessee Division of Consumer Affairs at www.tn.gov/consumer.