Tax Collectors Aren't Just IRS Employees Anymore
Starting on January 1, 2006, the IRS can use private collection agencies to collect a debt. The IRS will send you a letter letting you know if your case has been turned over to collections. If you get a call without a letter, do not give out any personal information. Take down the person's name, company name, telephone number and address. You should contact the IRS to see whether the agency is really working for them.
The IRS is planning to refer cases where the amount owed is under $25,000. For now, this program will only include individual tax returns and not business returns. The IRS will select past due tax accounts from across the United States.
Know your rights!
The private debt collector...
- Can only make arrangements with you to pay the debt. The private debt collector can not threaten to take other enforcement actions. They may tell you that the IRS can consider other enforcement actions.
- Can enter into installment or partial installment agreements. You will have to provide the debt collector information about your income and assets.
- Must follow Federal Fair Debt Collection Laws. Here are a few examples of Unfair Debt Collection Practices:
- Calling between 9 p.m. and 8 a.m.;
- Phoning too often;
- Contacting you directly when the debt collector knows you have an attorney; or
- Contacting you at work when they know your employer does not allow personal calls.
- Must not release confidential information to third parties without permission from the taxpayer.
- Should not request you pay the collection agency for the tax debt. Payments should only be sent to the IRS.
If you don't think you owe the money but you missed your appeal deadlines, you can contact the IRS office that first sent you a notice of deficiency and request an audit reconsideration.
You may have other options. The IRS can put your account in currently not collectible status. You might be able to apply for an Offer in Compromise which allows you to settle your debt for less than the full amount.
If you think the debt collection agency is not following the rules, you should call 1-800-829-0433 to report the agency to the IRS, call 284-4780 in Des Moines or 1-877-777-4778 to contact the Taxpayer Advocate and/or you can contact Iowa Legal Aid at 1-800-532-1275 for the toll-free number of the office serving your county to get help with your tax problem.