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That's a great article, lots of details on how it will and won't work. Interesting that it was passed 2 years ago:
"The IRS did not decide to do this on its own. Congress required the agency to use private-sector debt collectors as a way to help fund road improvement projects, when it passed the Fixing America's Surface Transportation Act in 2015.
Some IRS employees are opposed to private debt collection. Tony Reardon, president of the National Treasury Employees Union, said in a statement that he expects the result will be "collection agents getting paid to harass taxpayers, many of whom need assistance, not threats."
If the contract is written correctly and the private contractors perform as they should the results will be clear- the IRS needs additional employees to conduct the appropriate work that only they can do by statute.
In NJ all delinquent and deficient taxpayers are sent a bill by the State if they do not pay the bill the debt is sent to a collection agency. Government employees only get the debt that the private agency could not resolve. That volume of work is so substantial that added to the other statutory responsibilities the need for additional government employees is clear.
The union stewards who work at my agency have no issue with the private contractor after seeing the process.
In NJ the cost of the contract to the general public is zero as the fee paid to the collection agency is added to the tax debt of the person who owes the money.
Oh, it's worse than that. They garnish wages, levy bank accounts. If you're trying to live a normal life, losing the convenience of a bank account for deposits and to pay bills and the embarrassment of a wage garnishment is not what you want. Basically, you function w/cash and money orders - but that still doesn't help wage garnishment.
People should know, income tax liability over three years old can be discharged in bankruptcy. There are number of relatively simple timing rules governing eligibility, but income taxes can definitely be discharged. In some cases, if return is not filed and IRS assesses the liability, instead, the federal courts have ruled those taxes might not be discharged. One of the primary reasons one should always file a tax return on time - even if not able to pay the taxes due - as timely filing preserves the taxpayer's right to discharge the debt - and the three-year clock begins to run the date the return is filed. For business people, FICA, payroll withholding, and sales taxes cannot be discharged.
Mortgages and car loans can be reaffirmed by the lender, a routine procedure in bankruptcy. Most lenders will reaffirm these loans rather than foreclose or repossess provided payments are current.
So, solution is, if possible, put all taxes on a credit card, and then file bankruptcy.
All that said, PRIVATE collection agencies harassing people on tax debt is a bridge way too far, imo.
Just to clarify, if the IRS puts a tax lien on your property, which is usually one of the first steps, that lien is not discharged in a bankruptcy. The property cannot be sold until the lien is paid, by either you, or presumably, your kids if they inherit it.Im not even sure your kids could get the deed changed over in an inheritance with a tax lien on it. I dont think a title or deed can change hands with any sort of lien on it.
Can a stick up man send you a bill for the money he didn't get from you on the first go round?
Tax=theft
Having said that, everyone should just pay up, holding out will get you a jail cell.
You dropped out of the discussion very quickly the last time you made this claim and posters starting asking you about roads, bridges, police protection, fire protection, building inspections,public health, etc, etc.
Care to explain this time around how these things will be paid for without taxes?
This is concerning for security reasons. Previously you'd be assured that they'd never call you. They would send a letter. That may change now. Be careful -- I could see scammers taking advantage of this.
I am pretty sure the IRS does this every year.
To be blunt, I completely despise the amount of federal income tax I pay each year.. it exceeds two house payments. However, the IRS has always been fair to me when I owed taxes. As long as I paid what I said I was going to pay, no worries. And even when I had a few hardships, no worries.
The real issue is the irs is understaffed. The one government agency that turns in a profit and trump wants to reduce its staff
If the tax code wasn't so convoluted and manipulative, the IRS could function with less than 25% of the employees it has now. The administration of the IRS is a total waste of tax dollars.
Please explain how the IRS generates profit. I am eager to listen.
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