The most common scam attempt is the “IRS Collection” call or email. The Internal Revenue Service has contracted with four private collection companies to recover unpaid tax debts because of a law passed in 2015.
The bad news? This change will most likely increase or sustain the number of attempts made by scammers.
The good news? According to the BBB Risk Report, this scam is unlikely to be successful because people are more educated about tax collection scams.
Scammers continue to craft their messages and use sophisticated verbiage to convince potential victims they owe taxes and will be in legal trouble if they do not pay them immediately. This new approach by the IRS gives scammers new ammunition for their efforts.
Have your radar up for scammers posing as private collection firms or using names very similar to officially contracted companies. The IRS are watching for these schemes and will work with partners in the tax community and law enforcement about emerging scams.
BBB wants you to know these things about the IRS’s recent collection change:
You will pay the IRS directly. Private collection agencies will not ask for payment on a prepaid debit card, a practice used by current tax scammers. The consumer can opt to pay a past due balance by check, but this payment should only be payable to the US Treasury and sent directly to the IRS, never the private collection agency.
You will still get two letters. Any collection assignment must be preceded by two separate letters alerting the taxpayer of a past due balance and the pending collection activity. The first will be from the IRS notifying the taxpayer their account is being assigned to a private collection agency (PCA). The second will be from the designated firm. Both letters will contain information that will help taxpayers identify the tax amount owed and assure taxpayers that future collection agency calls they may receive are legitimate.
Not everyone is affected. Remember these private collection firms will only be calling about a tax debt the person has had – and has been aware of – for years and had been contacted about previously in the past by the IRS.
You can opt out. Consumers who do not wish to work with the assigned private collection agency to settle overdue tax accounts may submit a request in writing to the private agency directly.
As always, you can help others by reporting scams to the BBB Scam Tracker.
