Arizona

Tax Debt and Bankruptcy Blog

480-507-5985Free Phone Consultation With Attorney

By Michael S. Anderson of Anderson Tax Law logo for Arizona tax attorney Michael S. Anderson P.C.
  • Legislators consider private IRS debt collection

    Boston_Tea_Party-CooperThe U.S. Senate passed it’s version of a bill meant to fund the highway system, but included language in the bill that would privatize much of the IRS’ collection responsibility.  The U.S. House of Representatives is working on it’s own highway bill and may just include a similar provision.  (The House GOP Wants Private Debt Collectors To Take Over IRS Jobs – Huffington Post)

    The Huffington Post Author covering the development sounds worried. I mean really, most people who owe the IRS are broke and private dead collectors abuse broke people, right?

    Now…I don’t necessarily disagree that most people who owe the IRS are living paycheck to paycheck, and I don’t disagree that private debt collectors have a reputation for being meanies and using meanie words.

    But the Author may want to consider a few things about the IRS:

    First, thanks largely to a progressive tax system that punishes hard work and ingenuity and that the IRS enforces, the American economy has no edge.  Poverty is growing.

    Second, debt collectors are meanies sometimes, but the idea that the IRS collection system is any less “abusive” than private debt collection is absurd.  IRS collection is abusive by definition and it’s abusive in reality every single day.

    Making the second point is easy.

    The IRS needs nothing more than 30 days of time after the issuance of a final notice letter to seize most of a paycheck.  No lawsuit needs to be filed, and the burden of proof is on the taxpayer to get out of a jam.

    I spoke earlier this week, to a young mother of 4 whose husband earns $45,000.00 per year.  His paycheck is being levied and much of the check is taken. He has tried to stop the levy by speaking with IRS collection, but the IRS won’t stop it until he provides a financial statement disclosing all of the families private financial information, and two missing tax returns that re-disclose private financial information.

    Of course, the Husband isn’t aware of the short term hardship provisions that exist, but the IRS collection department didn’t explain that option to him, and has forced him to seek help, while trying to keep his job and feed his family.

    I can’t count how many clients have complained to me about the attitude an IRS Officer used during a discussion.  If the Author doesn’t think IRS collection personnel don’t “dress down” taxpayers, he needs to ask around a bit.  Throwing some private debt collection into the mix will be nothing new.  The Huffington Post Author shouldn’t kid himself.