CrossLink Tax Resource Center

Tax Resource Center



IRS Use of Private Debt Collection Agencies

June 20, 2017

As required under a federal law enacted by Congress in December 2015, the IRS has begun a new private collection program for certain overdue federal tax debts. Under this program the IRS has contracted with four collection agencies.

The IRS will be sending Notice CP40 to a limited number of taxpayers to notify them that their overdue tax liability has been assigned to a private collection agency. The CP40 includes the name, address and phone number of the private collection agency and an explanation of how that collection agency will work with the taxpayer to resolve the overdue account.

The IRS explains on the Private Debt Collection page of their website the following concerning the use of private debt collection agencies:

  • Several factors contribute to the IRS assigning an account to a private collection agency, including older, overdue tax accounts or lack of resources that prevents the IRS from working these cases.
  • Private collection agencies must follow provisions under the Fair Debt Collection Practices Act and should be courteous and respect taxpayer rights.
  • The IRS will do everything it can to help taxpayers avoid confusion and understand their rights and tax responsibilities, particularly in light of continual phone scams where callers impersonate IRS agents and request immediate payment.
  • Taxpayers will be informed by the private collection agency about electronic payment options for taxpayers on If the taxpayer wishes to pay by check they will be instructed to make the check payable to the U.S. Treasury and mail it directly to the IRS.

See the following on the IRS website for more information:

  • Understanding Your CP40 Notice
  • Private Debt Collection webpage which includes the following:
    • List of the four private debt collection agencies the IRS selected
    • Accounts the IRS will never assign to a private debt collection agency
    • General information on the program

Recent Tax Updates

Reminder: Filing Deadline is July 15
July 7, 2020

Reminders of Filing Deadlines for 2019 Returns and 2020 2nd Estimated Payment
June 8, 2020

SECURE Act Retirement Account Changes
June 2, 2020

CARES Act Tax Provisions
May 7, 2020

Additional Things to Know About the Economic Impact (Stimulus) Payment
April 22, 2020

IRS Launches “Get My Payment” Online Tool
April 16, 2020

Additional Updates
© 2020 CrossLink Professional Tax Solutions, LLC. All rights reserved. Terms and conditions, features, support, pricing, and service options subject to change without notice.