IRS Awards New Contracts to Three Private-Sector Collection Agencies

The IRS recently announced that it has awarded new contracts to three private-sector collection agencies. According to the IRS, “[b]eginning Thursday, Sept. 23, 2021, taxpayers with unpaid tax bills may be contacted by one of [these] agencies,” regarding collection. As US International Tax Advisors explains, facing the collection of unpaid federal tax debt is a serious matter, and taxpayers who dispute their tax liability or are unable to pay should not simply ignore these agencies’ efforts to contact them.

The private-sector collection agencies that work with the IRS are:

• CBE Group, Inc. based in Waterloo, IA
• Coast Professional, Inc. based in Albion, NY
• ConServe based in Fairport, NY

What if You Dispute Your Federal Tax Liability?

While some taxpayers fall behind because they ignore their federal tax obligations or they cannot afford to pay, others face collection action because they dispute their tax liability. Although there are options for challenging the IRS’s determination of what you owe as a U.S. taxpayer, your options are limited once the IRS assigns your account to a private collection agency. To find out what you may be able to do to challenge your tax liability and avoid collection, you should consult with a Maryland tax attorney promptly.

What if You Cannot Afford to Pay What You Owe the IRS?

Likewise, if you haven’t paid the IRS because you cannot afford to pay what you owe, you have options in this scenario as well. Once again, however, your options are more limited if you are now facing collection. It may be possible to settle your debt with the collection agency, but this may or may not be your best option depending on your individual circumstances.

Consequences of Ignoring a Private Agency’s Efforts to Collect Your Federal Tax Debt

As the IRS notes, “[p]rivate firms are not authorized to take enforcement actions against taxpayers. Only IRS employees can take these actions.” So, if you refuse to pay, not only can this drastically impact your credit, but it can also result in your account being referred back to the IRS. At this point, the IRS may file a Notice of Federal Tax Lien, issue a levy to collect the amount due or take other legal action against you.

There are grounds to challenge private agencies’ efforts to collect past-due taxes in some cases. For example, the IRS is not supposed to assign the accounts of taxpayers who have a right of appeal or who qualify as innocent spouses. If you are facing collection by CBE Group, Coast Professional or ConServe, you need to be careful to protect yourself, and your next step should be to consult with a Maryland tax attorney.  

Contact US International Tax Advisors

If you are facing collection action related to your federal income tax liability in Maryland, we encourage you to contact us for a confidential consultation. To request an appointment with US International Tax Advisors, please call 844-796-8565 or inquire online today.