The IRS has been around for a very long time, and it’s hard to imagine a world in which it doesn’t exist. However, if Senate Republicans had their way, that’s exactly what we’d have.
Senate Republicans are angling to get rid of IRS agents and to replace them with private debt collection agencies. Democrats and many others, including some fellow Republicans, think this is a horrible idea. Those who are against it cite the bad reputations of collection agencies, which are often known for harassing and intimidating consumers and their family members, or forcing people into paying debts that they don’t actually owe.
Opponents of this idea also point to the fact that, in the past, efforts to make tax collection a private, not federal, matter have ended up being costly for the government. Similar efforts, enacted in 1996 and 2006, have cost the federal government $17 million and $4.5 million, respectively.
These losses are usually due to the fact that those who owe back taxes don’t often have the money to pay them, which means all those high-cost efforts to collect them privately end up being for naught. While there’s been no decisions as of yet, there is a chance that private tax collection might be tried once again, but only time will tell.