IRS outsources debt collection…maybe.

Under the Bush administration the IRS decided to turn some of its debt collection activities over to private agencies, and $73 million worth of debt was sent out to a private collection agency in October. But now that the Democrats have won control of Congress, that program may never be funded.

Key Democrats believe that the IRS should do its own debt collection. It won’t cost any more and the government will have more control over how debt collection is conducted, they argue.

My experience with collection agencies puts me on the side of the Democrats. In my experience, collection agencies often say or do things that violate the Fair Debt Collection Practices Act and they seldom get caught or punished when they do.

You can’t erase IRS debt by filing bankruptcy, so your primary weapon against debt you cannot pay is not available in this case.

Comments are closed.