According to Report From the TIGTA, the IRS is Currently Unable To Enforce Collections on Extensive Tax Debt Says Fresh Start Tax LLC

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The Internal Revenue Service is one of the largest and most powerful collection agencies in the world, but according to the June 7, 2013 report from the Treasury Inspector General's Office the IRS has over $356 billion of unpaid tax assessments in fiscal year 2011. At the end of fiscal year 2012, there are over 1.1 million cases with unpaid tax debt.

Effective Tax Representation

Effective Tax Representation

“With the federal government needing revenue to pay down the deficit, you would think that the Department of Treasury would spend more money to collect these back taxes,” says Michael Sullivan, former IRS Agent at Fresh Start Tax.

Many taxpayers may not know that the Collection Division of the Internal Revenue Service is responsible for bringing taxpayers into full compliance, helping people understand their tax requirements and collecting unpaid tax debt. They have over 16,000 employees and, at the present time, it still does not have the necessary resources to collect all the back tax assessments that are owed. Even with the power of seizing bank accounts and garnishing wages, there are approximately 1.1 million cases with over $65 billion sitting in a queue with absolutely no activity going on because there are no funds or resources to work these cases.

The above information comes from a recent report from the Treasury Inspector General for Tax Administration, that was established under the IRS Restructuring and Reform Act of 1998 to provide independent oversight of IRS activities. "With the federal government needing revenue to pay down the deficit, one would think that the Department of Treasury would spend more money to collect these back taxes," says Michael Sullivan, a former IRS Agent at Fresh Start Tax. A recent report has shown that for every collection division employee the ratio is 3 to 1 collections to salary. To read the report in its entirety, please see TIGTA Audit Reports.

The main purpose of the Internal Revenue Service collection division is the following:

  •     Securing delinquent returns.
  •     Collecting balances due.
  •     Detecting potential fraud.
  •     Using enforcement actions when appropriate.
  •     Addressing and deterring Trust Fund Non-compliance.
  •     Resolving accounts with installment agreements and offers in compromise when appropriate.
  •     Reducing the Tax Gap.

The Collection Process begins what a taxpayer voluntarily files a return without full payment or when the IRS proposes a tax assessment through one of its compliance programs. The process ends only when the taxpayers account balance reaches zero or when the statute of limitations expires. The Collections Process involves multiple stages, steps, and employees. Because the Collections Process can be complicated, taxpayers who receive collection notices should seek assistance from a qualified tax resolution professional.

According to the TIGTA Report, a recommendation has been made to the IRS to better evaluate itself because it only does so from within.

Fresh Start Tax is a professional tax resolution firm, A+ Rated and accredited by the Better Business Bureau. On staff are Board Certified Tax Attorneys, CPAs, and Former IRS Agents, Managers and Instructors. We have over 206 years of professional tax experience and over 60 years of direct IRS experience. To learn more about Fresh Start Tax, LLC, please visit or call us at (866)700-1040.

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Kelly Hadlock
Fresh Start Tax, LLC
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