Changes to 2017 Tax Due Dates
Private debt collection program to begin next spring
IRS has announced that it plans to begin private collection of certain overdue federal tax debts next spring and has selected four contractors to implement the new program.
Background. Code Sec. 6306 was enacted as part of to the American Jobs Creation Act of 2004 (P.L 108-357). The 2004 legislation provided that nothing prevented IRS from entering into "qualified tax collection contracts" with private collection agencies (PCAs) to assist in the collection of delinquent federal tax debts.
The Fixing America's Surface Transportation (FAST) Act (P.L. 114-94, signed into law on Dec. 4, 2015) added new Code Sec. 6306(c) which provides, "notwithstanding any other provision of law, the Secretary shall enter into one more qualified tax collection contracts for the collection of all outstanding inactive tax receivables." New Code Sec. 6306(d), which was also added by the FAST Act, excludes certain receivables from the definition of outstanding inactive tax receivables.
A tax receivable means any outstanding assessment which IRS includes in potentially collectible inventory. An inactive tax receivable means any tax receivable if:
A tax receivable is not eligible for collection under a qualified tax collection contract if the receivable:
Private tax debt collection. IRS selected the following contractors to carry out the new program:
The new private debt collection program allows designated contractors to collect outstanding inactive tax receivables on IRS's behalf. Thus, the private collection agencies will work on accounts where taxpayers owe money, but IRS is no longer actively working their accounts. IRS notes that several factors contribute to IRS assigning these accounts to private collection agencies, including their being older, overdue tax accounts or IRS's lack of resources.
IRS will give each taxpayer and his representative written notice that their account is being transferred to a private collection agency. The private collection agency will then send a second, separate letter to the taxpayer and his representative confirming this transfer.
Private collection agencies will be able to identify themselves as contractors of IRS. Employees of these collection agencies must follow the provisions of the Fair Debt Collection Practices Act and must be courteous and respect taxpayer rights.
IRS advises that private collection agencies will not ask for payment on a prepaid debit card. Taxpayers will be informed about electronic payment options for taxpayers on the website "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.
The Internal Revenue Service and the Treasury Inspector General for Tax Administration continue to hear from taxpayers who have received unsolicited calls from individuals demanding payment while fraudulently claiming to be from the IRS.
Based on the 90,000 complaints that TIGTA has received through its telephone hotline, to date, TIGTA has identified approximately 1,100 victims who have lost an estimated $5 million from these scams.
"There are clear warning signs about these scams, which continue at high levels throughout the nation," said IRS Commissioner John Koskinen. "Taxpayers should remember their first contact with the IRS will not be a call from out of the blue, but through official correspondence sent through the mail. A big red flag for these scams are angry, threatening calls from people who say they are from the IRS and urging immediate payment. This is not how we operate. People should hang up immediately and contact TIGTA or the IRS."
Additionally, it is important for taxpayers to know that the IRS:
Potential phone scam victims may be told that they owe money that must be paid immediately to the IRS or they are entitled to big refunds. When unsuccessful the first time, sometimes phone scammers call back trying a new strategy.
Other characteristics of these scams include:
If you get a phone call from someone claiming to be from the IRS, here's what you should do:
Taxpayers should be aware that there are other unrelated scams (such as a lottery sweepstakes) and solicitations (such as debt relief) that fraudulently claim to be from the IRS.
The IRS encourages taxpayers to be vigilant against phone and email scams that use the IRS as a lure. The IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels. The IRS also does not ask for PINs, passwords or similar confidential access information for credit card, bank or other financial accounts. Recipients should not open any attachments or click on any links contained in the message. Instead, forward the email to email@example.com.
For more information or to report a scam, go to www.irs.gov and type "scam" in the search box.
More information on how to report phishing scams involving the IRS is available on the genuine IRS website, IRS.gov.