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Watch out for fraud as IRS rules change

Tax collection fraud is already very common. Some reports indicate that millions have been called since just 2013, with around 10,000 people paying some $55,000,000 in taxes.

The scam is simple. They just call, say they are with the Internal Revenue Service (IRS), and demand that you pay the taxes that you owe. Worried about breaking the law, people mail in the money, only to find out that they weren't talking to the IRS at all.

To stop it, the IRS has always said they won't call. They'll contact you in other ways, such as by mail. If you get a call, it's safe to assume it's a scam and hang up, they have said.

That's now changing. The IRS has decided to start using private debt collection companies. While the IRS may not call you, these companies legally can.

You will get a letter from the IRS first. It will tell you that the collections agency is getting the case. That agency will then send you another letter. They're working on 25 percent commission. After those two letters, they could contact you on the phone.

This is a massive shift for the IRS. Naturally, people are worried that tax fraud cases are now going to spike. People who may have simply hung up in the past may now worry that it's actually a legitimate call. If they have a hard time knowing if they're talking to a real collections agency, they may pay a fraudulent one, instead.

With the risk of tax fraud rising, it's important for Americans to know what legal rights they have when they fall victim to one of these tax schemes.

Source: CBS, "Advocates worry new IRS debt collection service leads to fraud, confusion," Jericka Duncan, April 05, 2017

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