Obama Legacy: IRS paid private debt collectors $20Mill to recoup $6.7Mil from low income americans...what? Your weren't told that?
The Internal Revenue Service (IRS) spent millions of dollars over the past financial year to contract private debt collectors that targeted some of Americas poorest citizens for unpaid taxes and only recovered a small fraction of the funds they were supposed to return to the agency, a new report released on Wednesday found.
The report, by the independent Taxpayer Advocate Service, found that the debt collectors had cost the IRS $20 million but had only brought in $6.7 million — less than one percent of the total amount targeted for collection. In some cases, the private agencies received commissions for work they hadn’t actually carried out.
But perhaps more damning was the Americans that the debt collection firms targeted. Congress directed the beleaguered IRS to use private contractors in 2015 in an attempt to make some headway into the $450 billion of unpaid taxesowed to the federal government. The contractors, however, were expected to adhere to the IRS rule that is supposed to ensure that taxpayers “have adequate means to provide for basic expenses.” But as USA Today reports, of the 4,141 taxpayers assigned to the private contractors, 19 percent had a medium income below the federal poverty level and an additional 2