Effective last month, the IRS once again will refer certain federal tax debt to private collectors. Congress enacted this legislation in the Fixing America’s Surface Transportation Act of 2015 (FAST Act). The IRS will send letters to affected taxpayers that their accounts have been assigned to one of the four authorized agencies. Refer to IRS Publication 4518, What You Can Expect When the IRS Assigns Your Account to a Private Collection Agency, for what the agencies can and cannot do. Practitioners should be aware that the IRS anticipates more email and phone tax scams as a result of this program.
Congress tried twice before, in 1996 and in 2006, to use private firms to collect tax debts, but the programs were unsuccessful and eventually canceled.
List of private collection agencies selected:
IRS Publication 4518: