Monday, December 7, 2015
Forbes: Congress Orders IRS To Use Private Debt Collection Companies, by Kelly Phillips Erb:
On December 4, 2015, President Obama signed into law the Fixing America’s Surface Transportation Act, or “FAST Act.” It provides long-term funding for transportation projects, including new highways, over a period of ten years. And as you would expect in a bill targeting highways and infrastructure, it also requires Internal Revenue Service (IRS) to use private debt collection companies.
Wait? You didn’t expect that? Of course not. Because tax policy has no business being stuffed into an already bloated bill (1,300+ pages) ostensibly focused on highways. But when has that ever stopped Congress before?
But there it is, at Section 32102: Reform of rules relating to qualified tax collection contracts.
Why reform? Under current law, IRS already has the authority to use private debt collection companies to locate and contact taxpayers owing outstanding tax liabilities and to arrange payment of those taxes. Historically, farming out collection hasn’t worked out for IRS.
Under the new law, there’s little in the way of discretion: IRS is required to use private debt collection companies to collect “inactive tax receivables.”
Forbes: IRS Private Debt Collectors Are Now Legal: 10 Things You Should Know, by Robert W. Wood