Category Archives: Tax.Collection

Niles deciding whether to outsource income tax collection

Source: Stan Boney, WKBN, July 14, 2017

It appears Niles will have a five-year plan — which includes outsourcing income tax collection to an agency outside of the city — to get out of fiscal emergency. But not everyone agrees with it. The plan would replace the Niles Income Tax Department with the Regional Income Tax Agency, known as RITA. … Bob Ward, president of the AFSCME Local 506 — a union representing the income tax workers, said he’s not in agreement with it. He showed WKBN a grievance from 2016 — which the union won — preventing RITA from taking over. Ward said they’ll file another grievance if need be. …

I.R.S. Enlists Debt Collectors to Recover Overdue Taxes

Source: Jessica Silver-Greenberg and Stacy Cowley, New York Times, April 20, 2017
 
The Internal Revenue Service is about to start using four private debt-collection companies to chase down overdue payments from hundreds of thousands of people who owe money to the federal government, a job it has handled in house for years.  Unlike I.R.S. agents, who are not usually allowed to call delinquent taxpayers by telephone, the outside debt-collection agencies will have free rein to do so. Consumer watchdogs are fearful that some of the nation’s most vulnerable taxpayers will be harassed and that criminals will take advantage of the system by phoning people and impersonating I.R.S. collectors. …

IRS Debt Collection Program May Lead to Confusion, Help Scammers
Source: AJ Walker, NBC Connecticut, February 14, 2017

NBC Connecticut Troubleshooters caught up with officials from the IRS to find out more about their new debt collection program and how they’re going to protect taxpayers from getting scammed. This spring, debt collectors hired by the IRS will start making collection calls to go after money on old tax debts. This could lead to confusion as the fake IRS debt collection scam call is one of the number one scams in the country. In the past, the IRS has repeatedly said they will never call you collect money. Instead, they send a letter. This change could open the door to crooks who might see this as opportunity to reach out to more people using the IRS’s name. It’s too early to gauge how the ongoing phone scam will impact real IRS debt collection call efforts. But people targeted by the scheme say it will be confusing. … The collection program came about because a law called the FAST Act passed in 2015 requiring the Internal Revenue Service to use private debt collectors to go after tax money on older accounts. The money would help pay the FAST Act’s $305 billion price tag to fund transportation and infrastructure. … However, this isn’t the first time the agency has tried to use debt collectors. In 2006 the IRS hired Pioneer, CBE Group and a company called Linebarger Goggan Blair & Sampson to try to collect an additional $1.4 billion in past due taxes. It fired the debt collectors in 2009 saying it wasn’t cost effective to use private collectors and the “work is best done by IRS employees.” … However, one IRS debt collector has recently been accused of not acting in peoples best interest. Pioneer was mentioned in lawsuits filed by the Illinois Attorney General and the Consumer Finance Protection Bureau accusing the business and its parent company Navient of taking advantage of borrowers. …

NTEU: Using IRS employees, not outsourcing for debt collection ‘smart and humane’
Source: Meredith Somers, Federal News Radio, September 27, 2016

The National Treasury Employees Union wants the Internal Revenue Service to retrain thousands of employees facing pink slips for outsourced tax-collection work. NTEU President Tony Reardon said his organization will push Congress for resources IRS needs to teach more than 7,000 employees how to track down late accounts. … A provision within a highway bill passed last year requires the IRS to pass on certain delinquent accounts to private collection agencies (PCAs). The employees who face layoffs work at one of three paper tax return processing sites in Covington, Kentucky; Fresno, California; and Austin, Texas. Their jobs would be phased out between 2019 and 2024. … In its fiscal 2017 objectives report to Congress, the Taxpayer Advocate Service warned that the private debt collection program “includes practices that will harm taxpayers and tax administration.” The program was discontinued in 2009 after TAS warned the program threatened taxpayer rights and raised doubts about its revenue projections. One of the concerns with the new law is that it does not take into account economic hardship, nor does it grant PCAs the power to work out a compromise with taxpayers based on their status. … About 1,800 employees work at the Convington site, while 3,000 and 2,400 work at the Fresno and Austin locations, respectively, and the phase-out of the jobs is just one thing that worries Rep. Thomas Massie (R-Ky.). During a House Committee on Oversight and Government Reform hearing on federal vacant properties, Massie called the news of moving 2,000 jobs out of the city “devastating.” …

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Union fights push to hire private tax collectors

Source: Associated Press, April 15, 2014

A public employees union is fighting a bipartisan effort in Congress to force the Internal Revenue Service to hire private contractors to collect some delinquent taxes. The IRS stopped using private tax collectors in 2009 after determining that agency employees could do a better job. The National Treasury Employees Union said the program failed in the past and should not be forced on the IRS. … The Senate Finance Committee passed a bill two weeks ago that included an amendment requiring the IRS to revive the program. The amendment was offered by Sen. Chuck Schumer, D-N.Y. It was accepted without opposition….

New Jersey town takes the taxing out of tax collection

Source: John Breeden II, GCN, December 20, 2013

…If enough residents don’t pay their taxes or their municipal bills, it can strangle a small government. Municipalities do have some tried and true ways to recoup those fees, including the auction of tax liens, where investors can purchase county-held tax certificates representing unpaid taxes and fees. But setting up an auction of thousands of liens is time consuming and expensive for small governments. Plus, live auctions further delay the payment of delinquent taxes and fees. Moving the process online can greatly reduce administrative costs, increases the pool of bidders, and can help local governments more quickly recoup taxes and fees. …

… To combat the overhead involved in the in-person auctions, Red Bank contracted with Realauction.com to move the entire process online. Realauction.com is a seven-year-old company that is currently working in Florida, New Jersey, Maryland, Colorado and Arizona and the cities of Detroit and Chicago. In New Jersey, Red Bank was the first municipality to come onboard, but now many others are joining up. …

…Realauction.com has developed software to meet the needs of specific counties. One program automates the creation of a notice of sale for foreclosed properties. Another calculates the amount due on each tax lien, tracks payments electronically and notifies the municipality when funds have settled. The system processes receipts, notifications and title orders on hundreds of tax liens simultaneously, the company said, accomplishing these tasks in a matter of hours rather than days. Crum said that security is not a big problem because the documents are public records. However, bidders’ information like their Social Security numbers pass through a one-way gateway to the website during sign up and are kept in an encrypted vault that can’t be accessed remotely. …

Firm says home rule may be a cost-saving measure for Cumberland County

Source: Christen Croley, Sentinel, November 14, 2013

…Among the recommendations Public Financial Management unveiled Wednesday during a Cumberland County finance meeting was the idea the county could move to a home rule charter style of government. PFM consultant Gordon Mann said home rule allows the county flexibility to eliminate duplicate services, cut costs and reorganize without violating county code….

…In another of its recommendations, PFM lead consultant Dean Kaplan advised commissioners to consider “managed competition” for applicable services, including building security, facility cleaning, prisoner transportation and delinquent property tax collection….

Portsmouth Resident Working to Find Ways Communities Can Share Services

Source: Sandy McGee, Portsmouth Patch, April 7, 2013

The Joint Commission on Shared Municipal Services has appointed two advisory committees to support its first steps toward helping cities and towns cut costs by working together to provide municipal services. The commission…has announced the appointment of a Public Safety Dispatch Service Advisory Committee and a Tax Collection Service Advisory Committee, since public safety dispatch and tax collection were among the services that legislators have identified as having the greatest potential for sharing and saving money for municipalities.

Florida backs off license tag fight

Bing: Privatizing can save city cash

Tax amnesty program gains committee’s OK

AFSCME Privatization Update

Information on the latest activities, problems, and issues in the contracting out of public services