Monday, July 23, 2007

Ways and Means Votes to End IRS Private Debt Collection

Here is some mixed news regarding debt collection and the IRS from the National Society of Accountants:

The House Ways and Means Committee voted July 18 to repeal the private debt collection program used by the IRS to collect federal income taxes. The vote was 23-18, with all 17 Republicans on the committee (and one Democrat) voting against the bill, H.R. 3056, The Tax Collection Responsibility Act of 2007. The Administration had supported the private debt collection program as a means of reducing the $345 billion tax gap. Ways and Means Oversight Subcommittee ranking member Jim Ramstad (R-MN) took the position that without the program, the IRS would assign workers elsewhere and the tax debt would go uncollected. Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA) countered that the collection of taxes “is a core government function. It is the Internal Revenue Service’s mission.” Lewis said the program wastes tax dollars by paying a bounty up to 24 percent to the private contractors hired to collect tax debt from delinquent individuals. “The private debt collection program is an insult to the American taxpayer and our federal tax system,” Lewis said. A copy of the bill is available at the following link:

http://waysandmeans.house.gov/media/pdf/110/07%2018%2007/3056Description.pdf

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