Robert J. Fedor, Esq., L.L.C.

IRS may soon use private debt collectors to recoup tax debt

Another April 15 tax deadline has come and gone and it's likely many tax payers either knowingly or inadvertently failed to pay some portion of their taxes. In cases where an individual owes the IRS money, it’s highly likely the IRS will eventually find out. When that happens, depending on the amount of tax debt, the IRS may be willing to work with a taxpayer to come to terms on how to repay all or a portion of the debt.

In cases where the IRS’s attempts to notify a taxpayer are to no avail, if the amount owed is considered nominal, no further action may be taken. These are the types of cases that proponents of proposed plans to hire private tax collection agencies use to defend their position.

Both democrats and republicans have supported the plans which they contend would generate additional revenue thereby allowing the cash-strapped federal IRS agency to hire additional agents. Those opposed to hiring private debt collectors to recover IRS tax debt, believe the investment won't pay off and may put taxpayers at risk.

Despite laws governing the acceptable collection practices of private debt collectors, reports of rampant abuse of these laws are common. In addition to fears about taxpayers being subjected to possible abusive and deceptive debt collection practices, private collectors also lack the authority to negotiate debts and repayment terms.

Ohio residents, who are currently dealing with tax debt, would be wise to contact an attorney. Even in cases where the IRS hasn't taken legal action to recover tax debt, a criminal defense attorney who handles tax crimes can provide advice on how to remedy a situation as quickly and painlessly as possible.

Source: The Washington Post, "Should the IRS use private collection agencies to pursue tax debts?," Josh Hicks, April 15, 2014

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