IRS in a ?Debt Crisis? and Needs Private Collectors: Lobbyist

The lobbying firm representing the two collection firms in the IRS private debt collection program this week fired back at the House Appropriations Subcommittee on Financial Services and General Government, which earlier this week sought to limit funding for the program (“House Cuts Funds for IRS Privatization Program,” June 19).

“It’s no secret that the IRS is in the midst of a debt crisis and the IRS Private Debt Collection Program is the only initiative working now to mitigate this situation,” said coalition spokesman Dan Drummond, spokesperson for the Tax Fairness Coalition, which represents collection agencies CBE Group and Pioneer Credit Recovery, the two firms collecting for the tax agency. “It’s unfortunate that some members of Congress are more interested in supporting a narrow special interest program [rather] than a program that continues to benefit all taxpayers.

Drummond pointed to the report from the Treasury Inspector General for Tax Administration showing that uncollected debts owed to the IRS grew by $290 billion in 2007, while the gap between the new delinquent accounts and the cases closed grew by 63 percent.

“Every minute delayed in collecting these taxes costs the American taxpayer thousands,” Drummond said. “We can’t afford to end this program now before it even has a chance to get off the ground.”

The House has sought to end the program before, but House-approved legislation hasn’t received any action in the Senate (“US House Passes Bill Killing IRS Privatization Program,” April 16).

The Private Debt Collection Program, according to Drummond, collected nearly $60 million through the end of May. The Joint Committee on Taxation estimates the program will bring in $600 million for the U.S. Treasury over a 10-year period.