IRS Private Collection Program Is Fundamentally Flawed
Unlike the last time this was tried, the scammers who have rushed into the vacuum created by the erosion of the IRS collection division have created an environment in which it is assumed by many, quite rightly, that a phone call about a purported tax liability is not legitimate. This will probably hamper the collection agencies in being taken seriously. Somebody with the sophistication to conclude that the company is legitimate might also calculate that there is really no percentage in dealing with them. The best deal they can approve is a full pay five-year installment plan and they can’t do any of the nasty things that actual IRS employees can do.
I’m thinking that if I was John Koskinen, that I would send out a mailing to everybody about to be turned over to private collection offering them a 20% discount if they pay in full within 45 days. There’s probably a hundred technical reasons why they wouldn’t work, but it would bring in the low hanging fruit and make the private collectors have to work for their money.
IRS Announces Private Collection Firms – They Start In The Spring
Now that this is starting to look real, I’m going to have to study what the real powers of the collection agents will be. If they can’t issue liens and levies and the like, it may be that people can tell them to go pound sand and wait for the case to be kicked back to somebody who can do something before the ten-year clock runs out. On the other hand, if they can approve expedited offers in compromise, it might be worthwhile dealing with them. We’ll see.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.