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IRS Outsourcing

As I’ve said before, this is a bad idea…

TaxProf Blog
IRS Outsources Tax Collection
Interesting article in the New York Times: IRS Enlists Help in Collecting Delinquent Taxes, by David Cay Johnston:

If you owe back taxes to the federal government, the next call asking you to pay may come not from an Internal Revenue Service officer, but from a private debt collector. Within two weeks, the I.R.S. will turn over data on 12,500 taxpayers — each of whom owes $25,000 or less in back taxes — to three collection agencies. Larger debtors will continue to be pursued by IRS officers.
The move, an initiative of the Bush administration, represents the first step in a broader plan to outsource the collection of smaller tax debts to private companies over time. Although I.R.S. officials acknowledge that this will be much more expensive than doing it internally, they say that Congress has forced their hand by refusing to let them hire more revenue officers, who could pull in a lot of easy-to-collect money.

One of the three companies selected by the IRS is Linebarger Goggan Blair & Sampson, a law firm in Austin, Texas, that has been under federal investigation for its collection practices. The firm’s web site is (the WSJ Law Blog reports that a Publican is “A collector of public taxes or tribute from the public”).

Filed under: Economics

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