For years, we’ve been told that calls from the IRS are fake and to hang up immediately if someone says they’re from the agency. However, starting soon, that warning may not be true. The IRS is going to begin to use collection agencies to demand payment from people who owe back taxes.
Kevin Thompson CPA says “the problem is, it’s going to be hard to determine if a call is legitimate or a fraud because the callers will be from third party companies. I laud this effort by the IRS. I’d like to see this underfunded bureaucracy utilize public-private partnerships to make them more efficient. They’d also have the opportunity to become more in touch with taxpayers and resolve many of these collection matters.”
The Better Business Bureau has been voicing concern about calls from the IRS because of the trust factor. Thompson says “there’s a lot to do here to reduce the opportunity for crooks to continue to mislead US taxpayers.”
Crooks have been using spoofing technology to convince victims they are from the IRS which has cost victims a pretty penny. The scam makes them think they owe back taxes and they are told to wire the money to avoid arrest or deportation. It cost taxpayers over $50 million dollars in 2016. Thompson says “these guys called me on my mobile. I agreed that I owed back taxes and asked them for their account number so I could wire into their account. Of course, the reply was for me to give them my information. I laughed and said, “not in this lifetime.”
The BBB is concerned that scam artists will align themselves with third party companies and take advantage of the situation to further bilk innocent taxpayers. “This is fraught with failure,” says Thompson. “How will the unassuming taxpayers know?”
The IRS will use four different private and contracted collection agencies who will call those who owe back taxes and direct them to pay using the website IRS.gov. They will not ask for payment, wire transfer, or prepaid payment card. Also, taxpayers will receive a written notice in the mail before receiving a call. “How long until the crooks start out sending the letters?” said Thompson. “This has to be comprehensively structured and reviewed.”
Still, the public is urged to be vigilant about taking any supposed calls from the IRS that seem suspicious or demand payment directly.
Collection agencies may begin the calling process immediately so be forewarned. Make sure you receive a letter first from the IRS and do not wire or pay using a gift card. Thompson says “I hope this is amazingly successful and leads to other Public-Private partnerships with the IRS. This would include working with the tax preparation profession for a more timely and orderly process to resolve controversy.
Right now, a taxpayer receives correspondence from the IRS regarding differences between the information contained on their tax returns and information provided to the IRS by third- parties. Of course, the IRS always assumes that the third-party information is correct and sends a detailed report including a proposed balance due. The report will give the taxpayers 30 days to respond before the balance is sent to tax court for resolution.” Thompson goes on to say “the challenge is the IRS does not have the resources to open and reply to this correspondence in 30 days. Often, it takes 8-12 weeks for the service to respond to your communication. Unfortunately, the IRS does not put a collection hold on the account awaiting their own internal resolution. And once this matter gets procedural, most taxpayers and their representatives are outmanned and lose to technicalities not to evidence.”
As for the first foray into these partnerships, the IRS will keep taxpayers updated about scams and include tips on how to protect yourself from cons. For more information, visit IRS.gov and look for the “Tax Scams and Consumer Alerts” page. Thompson advises, “Don’t venture down this path without your representation. It would be fun to tour the Amazon but not without a tour guide.”
If you have a tax collection or other controversy matter, please contact Thompson CPA.
Contact Kevin Thompson CPA
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