Sen. Elizabeth Warren, along with two other Senate Democrats and a Congressional Democrat, are calling on the Internal Revenue Service to better scrutinize the accounts that are being placed with one of four private collection agencies and to recall any accounts where the individual is not making enough money.
The members of Congress wrote a letter to Charles Rettig, the commissioner of the IRS, asking for details on the steps being taken by the tax agency to ensure that individuals who either derive most of their income from Social Security or who make less than 200% of the federal poverty level are not subject to having their unpaid tax debts placed with a private collection agency, which was required under legislation that was passed last year.
The Taxpayer First Act of 2019 is not scheduled to go into effect until 2021, but because the IRS has “refused to implement” recommendations from the Taxpayer Advocate for the past four years, the senders of the letter wanted to proactively reach out to the IRS “to ensure that your agency is preparing to fully implement the new requirements” of the law.
The four agencies working on behalf of the IRS collected $212 million during the 2019 fiscal year, which was up from $82 million a year earlier. After factoring out the IRS’s costs, the net profit for the 2019 fiscal year was $147.7 million, up from $51 million in 2018 and a loss of $13 million in 2017.
Among the questions asked of Rettig is “Will the agency require private debt collectors to cease collection efforts if these collectors learn that taxpayers that have been assigned to them are no longer eligible for collection under the program?” and “How will the agency hold debt collectors accountable in the event they are attempting to collect debt from taxpayers that are ineligible for collection?”
