U.S. Congressman José E. Serrano ~ Representing the people of the 16th District of New York
3/13/2009
IRS Ends Private Debt Collection
This past week, Congressional and agency actions brought about the effective end of the IRS Private Debt Collection Program. The program, which began in 2006, had contracted with private collection agencies to perform collection of unpaid taxes.
One of the two major actions that helped mark the end of the program was a provision inserted by Congressman Serrano into the recent fiscal year 2009 Omnibus Appropriations Act.
The language in the bill prevents the IRS from providing any funding to implement or enforce any contracts with private collections agencies. Serrano chairs the House Appropriations Subcommittee that oversees the IRS’s budget.
On Friday, March 6th, IRS Commissioner Mark Shulman declined to renew the contracts of the private collections agencies. A recent IRS study had indicated that the collection process could be done more cheaply and with greater return by IRS collection agents.
“I have always said that the IRS should handle 100% of its enforcement services in house, rather than contracting out for a fee to private debt collectors,” said Serrano. “That is why we included a provision in the recent Omnibus Appropriations bill that will prevent the IRS from using funds to implement the program. I am heartened that the IRS has made the right decision and ended the program.”