Will this New Form of Tax Fraud Ensnare You?

--Scam Artists most likely to Benefit from IRS Policy Shift

Magalia, California--Unleashed by the 2006 IRS private debt collection "initiative," the rumor mill is starting to fill up with stories of new tax scams. Fueled by the pest-power of private collection agencies, this "initiative" holds forth the promise (or threat, depending upon which side of the desk one happens to be sitting) of providing a new windfall source of revenue--to 3 parties: IRS, collection agencies, and scam artists.

Supposedly, assurances to the taxpayers involved--for this new inclusion of private collection agencies in the tax payment equaion-- are provided by IRS:

Taxpayer notification. IRS will notify the "selected" taxpayers before they are contacted by a private debt collection agency. The name of the company will be included in the notification letter.

Collection agency letter. All participants will receive a second letter, this one from the collection agency, informing the taxpayer that they will soon be contacted regarding back taxes.

Money collected. All checks will still be made payable to the U.S. Treasury--not to an individual or firm. The collection agency will provide the appropriate IRS mailing address for payments. They will never ask for cash or checks written to individuals.

Legal thriller author, Jack Payne, whose specialty is the study of scam artists and their operations, comments, "'Oh, ho, you say,' with a smile of satisfaction as one of the 'selected'. 'This assures me that I can't be ripped off.'" Payne continues, "Oh, yeah, sure You may find satisfaction that you will not be hounded in a way as to be victimized by scam artists. But, how about all the millions of other taxpayers who are unaware of these procedures? This is what opens up a whole new market to scam artists.

"What's to stop them from getting well-credentialed, and approach you waving a copy of this new initiative, and announcing that they have been charged by the IRS to collect back taxes on their behalf. They can lay down their own rules of process to these unwitting victims who have no knowledge of what these official rules are. It's as good as extending a license to steal to a whole new breed of scam artists.

"How about notification to every taxpayer of the proper, official procedure. Only then will the hand of protection to the new millions of scamable people be extended But, don't hold your breath. Remember, a pessimist is never disappointed. In the final analysis, when you put 2 common words together, 'the' and 'IRS' it spells, 'theirs.'

"It won't be long before we'll all be longing for the good old days when a tax audit meant, simply, going to an IRS office with, maybe, your attorney or accountant in tow, for an afternoon of good old-fashioned haggling.. Just you and IRS, no middle-man.

"But, If you do get on an IRS 'hit' list you now face a doubling-up, a collection agency to also bludgeon you. Every time you hit bottom it seems, somebody hands you a shovel. It will be most interesting to see how this new scam-fest will work out."