TIGTA Releases Independent Assessment of IRS Private Collection Activities

The Treasury Inspector General for Tax Administration (TIGTA) recently released its biannual independent assessment of the Internal Revenue Service's (IRS') private debt collection program, which became a requirement under the 2015 FAST Act. According to TIGTA, the private collection agencies are performing well with respect to procedural accuracy and professionalism. Customer satisfaction scores are generally in the low- to mid-90 percent range.  As of September 2018, the private collectors had been assigned more than 700,000 taxpayer accounts and collected approximately $88.8 million from the balances owed.

This private collection rate represents about 2 percent of the balances assigned, however, and there remains room for improvement across various program attributes. Of the more than 21,000 payment arrangements established through private debt collection agencies for federal tax liabilities, over half of the taxpayers failed to make payments as agreed. Private agencies also encourage taxpayers to borrow money from friends and family to address their liabilities, which may not be an allowable practice under the law. Finally, the private collections agencies' calculators for interest and penalties have been found to be inaccurate.

For more details from TIGTA's biannual report, click here.

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