Lawmakers Lobby Treasury to ‘Protect’ Stimulus Checks From ‘Predatory’ Collectors

A growing number of people are becoming increasingly concerned that debt collectors are going to swoop in and snatch the economic stimulus checks that are being handed out to Americans across the country, and are using the federal government to do something about it.

“Hawley, Brown Call on Mnuchin to Protect Direct Cash Relief from Predatory Debt Collectors” reads the headline on the website of Sen. John Hawley [R-Mo.], sharing a letter he and Sen. Sherrod Brown [D-Ohio] wrote to Treasury Secretary Steven Mnuchin last week, to protect payments made under the CARES Act “from being seized by predatory debt collectors” which was not “what Congress intended.”

The only offset that Congress included in the CARES Act as it pertains to the $1,200 checks is for unpaid child support payments.

While the Internal Revenue Service has stopped placing new accounts with one of the four private collection agencies it works with during the coronavirus pandemic, it did not address what the agencies should do with existing cases, according to the IRS’s former Taxpayer Advocate.

Nina Olson, who retired as the Taxpayer Advocate in 2019, said there is a lack of clarity in how the tax agency is handling current cases that have been placed with a collection agency, according to a published report.

“That there is even the remotest possibility in the course of this economic and health crisis a [private collection agency] employee would contact a taxpayer who is low income, or receiving Social Security Disability Income (SSDI) or Supplemental Security Income (SSI), is unconscionable,” she said.

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