The IRS has entered into contracts with four private debt collection agencies- Conserve, Pioneer, Performant and CBE Group. These agencies will only take over accounts if several criteria are met:
- The tax debt has been removed from the IRS’s active inventory due to a lack of resources or an inability to find the taxpayer;
- More than one-third of the applicable limitation period has passed and no IRS employee has been assigned to collect the debt;
- The debt has been assigned for collection, but more than 365 days have passed without interaction with the taxpayer for purposes of furthering collection of the debt.
These collection agencies are required to abide by the consumer protection provisions of the Fair Debt Collection Practices Act. This means they cannot call you before 8 a.m. or after 9 p.m.; they cannot contact you at work if you have told them not to; they cannot falsely claim you have committed a crime; they cannot misrepresent the amount you owe or threaten you with harm or arrest for lack of payment.
Consumers need to be aware of tax scammers looking to capitalize on this new IRS protocol. Tax scammers oftentimes ask their victims pay their alleged debts by purchasing prepaid cards and then call back with the cards’ codes. Another common scam involves having large amounts of money sent via wire transfer.
This will never be the case with the listed contracted debt collectors, according to the IRS. In fact, taxpayers will not be asked to pay the private debt collectors anything. Instead, these collectors will provide information about electronic payment options for taxpayers on IRS.gov/Pay. Even written checks will need to be made payable to the U.S. Treasury and sent directly to the IRS, not the private collection companies.
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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.