IRS May Soon Use Private Debt Collectors

A provision in the highway bills before Congress would require the IRS to hire collection agencies to collect back taxes. Congress sees it as a way of raising money to pay for highway construction. Opponents say it would lead to abuses, and that it’s been tried in the past — and cost taxpayers more than it brought in.


One quick question for you – would you rather get a call from the IRS or a debt collector? If Congress gets its way, private debt collectors will be working for the IRS to recover back taxes. That’s thanks to a provision tucked into the highway bill. NPR’s Brian Naylor reports.

BRIAN NAYLOR, BYLINE: Road building has traditionally been paid for with the gas tax, but inflation and more efficient cars mean the gas tax doesn’t bring in the revenue it used to. So lawmakers have turned to the Washington equivalent of looking under the seat cushions for loose change. One pile they are claiming is unpaid income taxes. Congress estimates it could find some $5 billion that way by hiring private collection agencies to go after taxpayers. But critics like Chi Chi Wu of the National Consumer Law Center say, at the most, government would get half that.

CHI CHI WU: Two-point-five billion dollars is a lot of blood to try to get out of a stone. And this isn’t just funny math. This is, like, fantasy math.