IRS decides not to renew private debt collection contracts and to hire over 1,000 new collection personnel in 2009

09 Mar IRS decides not to renew private debt collection contracts and to hire over 1,000 new collection personnel in 2009

The IRS has been using outside collectors to collect debt owed to the Internal Revenue Service. After conducting an extensive review of the private debt collection program, the IRS has decided not to renew its contracts that expired in early 2009 with two private debt collection agencies according to an announcement by the IRS (IR-2009-19).

According to the announcement, the IRS determined that the work is best done by IRS employees who have more flexibility handling cases – especially in these economic times. IRS Commissioner Doug Shulman also announced that the IRS anticipates hiring over 1,000 new collection personnel in fiscal year 2009.

The announcement also stated that “IRS employees have a range of options available to them in attempting to resolve difficult collection cases that, by law, the private contractors do not have.” Shulman went on to say that “by investing in IRS employees to perform this collection work, we can be assured that we have all the tools available for helping taxpayers confronting complex situations.”

Shulman said that the decision to not renew the contracts was in no way based on concerns over the performance of the two private debt collection companies.

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Jay S. Fleischman is a bankruptcy lawyer with offices in Los Angeles and New York. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.
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