We have said many times before that if the IRS calls to collect money it is most likely a scam. That is about to change.
Beginning in April of 2017 the IRS will use collection agencies to collect some unpaid tax bills.
This is good news for scam artists and terrible news for the unsuspecting.
Traditionally, the IRS begins the collection process with a letter explaining their reasoning, and they usually give you a chance to refute their claim.
Very few IRS communications start with a phone call, and they would never call unexpectedly asking for money.
The IRS will use four agencies for its collection efforts: Pioneer, CBE, Conserve and Performant.
Knowing the agency names will do little to ensure you are not being scammed as most scammers will claim to be calling or mailing from one of these companies.
The IRS is also supposed to notify you by letter that your debt transferred to a collection agency. Of course, that communication can also be fake.
The first thing you should do if you receive an unexpected call or letter from the IRS or an authorized collection agency is to check with your tax preparer to see if the claims are true.
Your tax preparer will be able to review the claims in question against the tax return.
If you receive a phone call or letter from the IRS collecting money, contact them directly. It is important not to use any contact information provided to you from the communications.
Many thieves provide false contact information hoping you use it to confirm their fraudulent claims. Find the number on your own.
When dealing with the IRS, you will most likely be required to wait on hold for some time. This hold time will be long and frustrating, but it is better than being scammed.
Confirming for yourself is essential not just with the IRS but anyone claiming to be a creditor. I have received many phone calls and emails over the years from scammers.
Some of these schemes are pretty clever. Not a single one has ever lasted longer than my attempt to confirm the information for myself.
If you have financial responsibility for a parent, spouse or loved one who has diminished mental capacity, take extra precaution.
Most scam artists prey on the elderly hoping to find someone struggling with Alzheimer’s or dementia that will be easily convinced they owe money.
Occasionally, you may owe the IRS money. Most of these claims are minor, and notifications are via mail.
If you confirm that you do owe money to the IRS, don’t take their word for it. The IRS does make mistakes, hire some muscle to help.
There are three designations that the IRS will accept and allow those who hold it to represent you in an audit: Certified Public Accountant (CPA), Enrolled Agent (EA) and attorneys.
Seek the advice of these professionals if you feel like you are in over your head with the IRS.