Efficacy and the Automated Collection System of the IRS

The Automated Collection System – what is it? Handling IDRS (Integrated Data Retrieval System) non-filer and balance due cases that need contact through phone is the ACS (Automated Collection System). Suffice to say, the ACS is a computerized network which contacts taxpayers who owe money to the IRS, which is a big IRS issue.

Data stored in the ACS include taxpayer and audit information. This was created in the 1980s to provide taxpayer examiners a chance to contact delinquent taxpayers, scrutinize cases, and provide notices.

By contacting creditors and collecting court records, corporate files, and bank statements, the ACS supports each item of information uploaded to it. The system is built with checks for consistency and validity.

The question remains if the ACS is an efficient way to collect taxes. A hearing to decide if private means were better than the ACS was held by congress.

Privatization is more expensive than ACS, as argued by Nina Olsen, an IRS National Taxpayer Advocate. The private program costs $12 million every year to utilize plus commissions of up to 24% with net revenues of just $11 million.

Revenues could total up to $91.8 million to $145 million by using the ACS, with no costly commissions and an investment of just $7 million. Olsen estimates that the privatization of collection is costing the government about $81 million each year.

The IRS says that it cannot afford to hire more officers for debt collection, that is why it outsources. They are, however, taking control of some cases from private collectors and handling them in-house to decide which process is more effective.

At the hearing, Colleen Kelley, NTEU (National Treasury Employees Union) president, says: "There has been no question from the outset that using private companies to collect taxes is far more expensive than having trained, accountable IRS employees perform this work and poses a severe and unnecessary risk to taxpayers' sensitive and personal information."

Kelley also stresses that IRS officers are the most cost effective tax collectors in the US, costing only 40 cents for each $100 collected. She emphasizes that with this resource, there is no need to outsource to private debt collection.

The ACS is a chance for the government to recoup more of the revenue from unpaid taxes. Private debt collection is expensive when compared with the cost effective work done by the IRS employees.

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Originally posted 2008-06-30 16:05:23. Republished by Blog Post Promoter

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