The Internal Revenue Service has awarded its first
contracts to three private firms to collect delinquent
federal tax debts, allowing them to keep 21 percent
of amounts they collect above $10,000 and up to 24
percent of amounts they collect under that.
The agency is authorized to hire contractors for the
work through the 2004 American Jobs Creation Act and
expects to assign uncollected liabilities beginning
this summer. Legislation has been introduced in the
House — HR-1621 — to repeal that authority.
The IRS said it would assign “relatively simple”
cases where the taxpayer has not disputed the
liability, allowing the agency to focus on more
complex tax issues and technical issues such as
offers in compromise, bankruptcies, hardship issues
or litigation, which the collection firms would not
be authorized to undertake. Nor would the firms be
allowed to take enforcement actions such as liens,
levies, or seizures, according to an agency statement.
The three firms, chosen from a group of 33 in a
competitive bidding process, are CBE Group Inc., of
Waterloo, Iowa, Linebarger Goggan Blair and Sampson,
LLP, of Austin, Texas, and the Pioneer Credit Recovery,
Inc., of Arcade, N.Y.
The agency said the second phase of the collection
project scheduled for 2008 would include contracts with
an additional 10 firms, and that the IRS would train
company personnel.
