The IRS uses private collection agencies for some tax debts. Learn which agencies are authorized, what they can and can't do, and how to tell real IRS collectors from scammers.
In 2017, the IRS began contracting with private collection agencies (PCAs) to collect certain tax debts that the IRS itself was not actively pursuing. This program created significant confusion — and a surge in tax scams — because many taxpayers don't know whether the collection call they received is from a real IRS-authorized agency or a criminal impersonator.
If you've received a call or letter from a company claiming to collect on behalf of the IRS, this article will tell you exactly what authorized private collectors can do, which agencies are currently authorized, what your rights are, and how to verify whether contact is legitimate — before you pay anyone anything.
The IRS manages hundreds of millions of tax accounts. For certain categories of older, lower-priority debts that the IRS isn't actively working, Congress authorized the IRS to refer accounts to IRS-approved private collection agencies.
The IRS refers accounts to PCAs when:
- The IRS lacks resources to work the account
- The debt has been sitting inactive for an extended period
- The debt does not meet the IRS's internal criteria for direct collection
These are typically older debts on accounts where the IRS has not been able to locate the taxpayer or where the balance is relatively modest. The program is explicitly not designed for high-priority enforcement cases — those remain with IRS employees.
The IRS contracts with a small, specific list of authorized private collection agencies. As of the current program, the authorized agencies have included:
Important: This list can change. The IRS may add or remove agencies. You can verify current authorized agencies at IRS.gov or by calling the IRS directly at 1-800-829-1040.
Never pay a debt collector — even one claiming to be IRS-authorized — without first verifying their status with the IRS directly.
When the IRS assigns your account to a private collection agency:
1. The IRS Notifies You First
Before any private collector contacts you, the IRS sends you a letter (Notice CP40) informing you that your account has been assigned to a specific private collection agency. This letter identifies the agency by name.
2. The Agency Then Contacts You
The private collection agency sends you a letter identifying themselves and informing you that your account has been referred to them. This letter comes shortly after the IRS's CP40 letter.
3. The Agency Calls You
The PCA may call you after sending their initial letter. They are required to provide their name and address and inform you that they're calling on behalf of the IRS.
If you receive a call before receiving any written notice, be very cautious. Legitimate PCAs are supposed to send letters first. An unexpected call without prior written notice is a red flag.
Authorized IRS private collection agencies can:
Private collectors are required to be professional, respectful, and comply with all provisions of the Fair Debt Collection Practices Act (FDCPA) — a federal law that protects consumers from abusive collection practices.
This is equally important — authorized IRS private collectors have strict limitations:
If a "private collector" claims they can garnish your wages, levy your bank account, or have you arrested — they are either lying or they are a scammer. Legitimate PCAs have none of these powers.
Whether you're dealing with an authorized IRS private collector or any debt collector, you have important legal rights under the Fair Debt Collection Practices Act:
Right to verification: You can request in writing that the collector send you verification of the debt. They must stop collection activity until they provide this verification.
Right to dispute: You can dispute the debt within 30 days of first contact. The collector must stop collection activity and verify the debt.
Right to stop contact: You can send a written request to stop further contact (though this doesn't eliminate the underlying debt).
Right to be free from harassment: Collectors cannot use abusive language, make threats, call repeatedly to harass you, or misrepresent the nature of the debt.
Right to know who you're dealing with: The collector must identify themselves and the company they represent.
Tax scammers have seized on the IRS private collection program as a cover story. Here's how to distinguish a legitimate IRS-authorized PCA from a scam:
If you're unsure, hang up and call the IRS. A few minutes of verification could save you from a costly scam.
The most important document in the IRS private collection process is Notice CP40. This letter:
If you receive a collection call and haven't received a CP40, be extremely skeptical. The legitimate process always starts with a letter from the IRS.
Accounts assigned to private collectors can be returned to the IRS if:
If you engage Tax Titans to represent you, we immediately file a Power of Attorney (Form 2848) and notify the IRS. The account is returned from the private collector to the IRS, and all collection contact must go through us — not you. This protects you from inadvertent disclosures and gives us control over the resolution process.
Many taxpayers wonder whether to just set up a payment arrangement with the private collector or to pursue resolution through the IRS directly.
The answer depends on your situation:
Working with the PCA may be appropriate if:
- The debt is accurately stated
- You have the means to pay in full or in monthly installments
- The balance is modest and there's no dispute
- You've already verified the PCA's authorization
Working with a tax professional is better if:
- The balance seems incorrect
- You have unfiled returns that are creating the problem
- You cannot afford the payments the PCA is suggesting
- You want to pursue an OIC, CNC, PPIA, or other resolution the PCA cannot offer
- You want to ensure you're getting the best possible terms
Private collectors are not authorized to negotiate the full range of IRS resolution options. If you have a complex situation — hardship, disputed amounts, prior notices of appeal — working directly with the IRS through an experienced representative is almost always more advantageous.
When Tax Titans is engaged on a private collection case, here's what happens:
Using the IRS Practitioner Priority Line, we reach live IRS agents quickly — bypassing hold queues — and move your case forward efficiently.
📞 Call Tax Titans at (888) 684-4992 — Monday through Saturday. Whether you've been contacted by a private collector or you're not sure if the call you received is legitimate, we can help you sort it out.
📋 Submit a contact form — we'll reach out as soon as possible. Tell us what you've received and from whom, and we'll verify immediately.
Is it normal to get a call from a private collection agency for IRS debt?
Yes — the IRS does authorize private collectors for certain accounts. But always verify by checking if you received a CP40 notice from the IRS and by calling the IRS to confirm the assignment.
Can an IRS private collector garnish my wages?
No. Private collection agencies have no enforcement authority. They cannot levy accounts, garnish wages, file liens, or seize property. Only the IRS itself can take these actions.
Can I refuse to work with a private collector?
Yes. You can hire a qualified tax professional and request that your account be returned to the IRS. Once Tax Titans is on record as your representative, the private collector must cease contact.
What payment methods does the IRS accept through private collectors?
Payments must be made to the IRS or U.S. Treasury — never to the collection agency directly. Authorized payment methods include check (payable to United States Treasury), money order, and online IRS payment systems. If a collector asks you to wire money or buy gift cards, it's a scam.
What if I think the debt amount is wrong?
Do not pay until the debt is verified. Request debt verification in writing, and contact Tax Titans to review the debt against your IRS transcripts before making any payment.
Don’t wait—every day you delay, penalties and interest grow. Let a Tax Titan fight for you.