IRS to begin real collection calls

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Victims thought they were talking to IRS agents, collecting their tax debts, not crooks. As of March 2, 2017, the IRS processed 1.7 million tax returns that reported almost $6.4 billion in Premium Tax Credits. Checks should be made payable to the U.S. Treasury and sent directly to the IRS, not the private collection agency.

"They are the same people who waited until the night before it was due to write their term paper", joked Joseph DeGennaro, tax director for Doeren Mayhew in Troy.

So here's how it's going to work: To start, the IRS is turning over 100 taxpayers per week to four private debt collectors.

"It's not out of the realm of possibility to eventually get a phone call from IRS after notices go ignored", said Clay Sanford, spokesperson for the IRS. The private companies will then send letters to the taxpayers before calling them. "The people included in the private collection program typically already know they have a tax issue".

If your proposed tax bill is $25,000 or less, you can file an appeal under the Small Case Request procedure, which simply requires you to fill out Form 12203 and send it in.

It can be easy to think that you only have to report income to the IRS that you get documentation for in the mail - such as via a W-2 form or a 1099 form. They also won't demand immediate payment. And the more tax avoidance measures you take, the more money you stand to save. Instead of driving yourself to drink, trying to hit the April 18 deadline, request an extension to file your taxes at a later date.

Factors more under your control that can keep your audit odds low include being neat and legible when filling out your return, reporting all income on it (including all dividends and interest that's reported on 1099 forms), and not having math errors on it that will draw the attention of the IRS.

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If you owe taxes and are called by a debt collector claiming to work for the IRS, you should verify the phone number with the IRS, Keckeisen says. Also keeping an eye out will be the National Taxpayer Advocate and the Treasury employees' union, both of whom have expressed strong reservations about the program's cost-effectiveness and how it's structured, among other things.

Whether or not a taxpayer's account is assigned to a private collection agency, the IRS warns taxpayers to beware of scammers pretending to be from the IRS or an IRS contractor. "We will be watching closely for any such schemes as the private collection program gets underway".

Another option is to pay taxes with your credit card.

The IRS tax scam is so successful it reportedly scams hundreds of thousands of people per day.

Before creating or cashing out a GoFundMe campaign, talk to a tax professional about what you can do to ensure the IRS views the donations as gifts rather than income.

The IRS will notify taxpayers, by letter first, when their account is being turned over. The company says it is a leader in enrolling borrowers in income-driven repayment plans and has helped almost 250,000 students rehabilitate their loans. If you switch to a new program or use one for the first time, you'll need to check your 2015 tax form in order to e-file. Those who owe $50,000 or less in combined tax, penalties and interest can use the Online Payment Agreement to set up a monthly payment agreement for up to 72 months. The interest you pay on your mortgage is tax-deductible, and the interest is front-loaded.