When a person has a significant amount of debt, they often find themselves in a heightened state of vulnerability. In an effort to respect every individual's circumstances and to prevent fraud, the Internal Revenue Service has tried to remain transparent in their processes.
Unfortunately, many citizens are not familiar with IRS policies and they fall victim to fraud schemes. These schemes often involve people impersonating IRS workers who pressure indebted individuals into sending out large amounts of money that they supposedly owe. Many people are concerned that new IRS policies will make this easier for criminals.
What changes are being made?
Up until recent months, it has been the policy of the IRS to conduct their debt collections. However, recent changes have altered this policy and the IRS will be contracting private debt collectors to begin collecting money owed to the government.
How will this work for consumers?
Because there is a possibility for fraud schemes to take advantage of this new policy, it is very important for people to know how the IRS will actually go about collecting debts.
· IRS letter
Before an agency working on behalf of the IRS begins collecting debts, the person in debt will receive a letter from the IRS informing them of the changes. Additionally, the person will then receive a letter from the firm who will be in charge of their debt collection. These notifications will not be over the phone.
· IRS payments
Even though the collection agencies will be working for the IRS, people will never have to send money to the collection firm. Any debt payments will be made directly to the IRS.
Important things to know
No matter which agency is in charge of debt collections, they still need to follow the law as laid out in The Fair Debt Collection Practices Act. The purpose of this Act is to make sure that consumers are treated well and that they are not taken advantage of.
If a consumer feels as though they have been mistreated or that their rights have been infringed upon, they are able to file an official complaint with the Tax Inspector General for Tax Administration and the Consumer Financial Protection Bureau.
As these policy changes are put into action, it will be important for both debt collectors and consumers to be aware of the relevant and related laws so that everything is done is a professional and respectful manner.