Starting today, individuals who owe the Internal Revenue Service for unpaid taxes may be contacted by one of three private collection agencies, after the IRS announced it had awarded contracts to the companies.
The three companies receiving contracts are: CBE Group, Coast Professional, and ConServe. CBE and ConServe previously received contracts from the IRS. The IRS chose not to re-select Performant, which is focusing its collection efforts in the healthcare space, and Pioneer Credit, both of which had been collecting unpaid tax debts along with CBE and ConServe.
The original four agencies collected $212 million during the 2019 fiscal year, the last year for which data was publicly available. That was nearly three times the total that was collected in the year prior, according to data released by the Senate Finance Committee. CBE collected the most among the four agencies, followed by Pioneer, ConServe, and Performant. CBE also has the best collection percentage, recovering 1.33% of the balance that was placed with it, followed by Pioneer (1.3%), ConServe (1.23%), and Performant (1.18%).
Congress passed a law back in 2016 that authorized the IRS to resume using private debt collection agencies to collect on unpaid tax debts.
Earlier this year, an audit called out the agencies for taking commissions on payments that were made outside of formal payment arrangements, but the IRS rejected the recommendation and said it believed it was complying with the law by allowing the agencies to do so. The IRS has also faced scrutiny
