IRS missed substantial debt collection cases

A discontinued debt collection program by the Internal Revenue Service ended with nearly half of a sampling of delinquent taxes not collected, according to a recent report by the Treasury Inspector General for Tax Administration. From 2006 to 2009, the IRS program collected more than $98 million from delinquent cases that were considered low-yield and not generally worked on by IRS employees. The recent TIGTA report reviewed the effectiveness of the IRS' debt collection tactics, finding 29 out of 62 past-due cases sampled had not undergone collection action. "We did not consider a case actually worked unless it was assigned to an employee and collection actions were taken by that employee," said Michael Phillips, deputy inspector general for audit at TIGTA's small business/self-employed division, according to Inside ARM. "Cases have a higher probability of collection when taxpayers are contacted." Public agencies have been ramping up debt collection activities in recent years, many times with help from the private sector, to address mounting fiscal challenges. Delinquent taxes, unpaid fines and other government dues are all seen as ways to help balance budget shortfalls.