IRS Set to Outsource Business Debt Collection

Recently, the IRS has confirmed that it will expand the scope of its private debt collection program initiated in 2017. On May 24, 2019, Bloomberg BNA relayed content of an IRS email wherein the IRS stated that, beginning in June of 2019, it will refer a small number of delinquent business accounts to private collection agencies. Via two anonymous sources reportedly "familiar with the discussions," Bloomberg BNA further clarified that the IRS intends to assign 200 business accounts per week--at least initially. 

Additionally, Bloomberg BNA reported that the IRS will spend several weeks monitoring the private collection agencies' management of these business referrals. Once the IRS is confident that things are running smoothly, the IRS will increase the number of business accounts it refers to private collection agencies.Bloomberg BNA noted that Jeff Trinca, vice president with Van Scoyoc Associates in Washington, indicated that "[t]he business cases will largely consist of unpaid employment taxes"-i.e., the payroll taxes that employers are required to withhold from their employees' wages and subsequently collect and remit to the IRS.Finally, Bloomberg BNA also reported that "[t]he IRS said the accounts will also include cases involving corporations and excise taxes. The cases being assigned to private collectors have already been shelved by the agency because of a lack of resources or because they are otherwise inactive."If you have questions about this development or need help with tax matters, please contact Frost & Associates, LLC today at 410-497-5947.

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