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Government Receivables

Governments of all sizes and locations are owed money. In the U.S. federal government, citizens and businesses typically owe taxes, fines and fees. Consumers can also owe on federally-backed student loans, while businesses can owe on development loans. Several branches of the U.S. government have robust ARM operations, including the IRS and the Department of Education.

On the state and local level, debts to the government can be too many to enumerate. From court fines and fees to sales tax to late parking tickets. An overwhelming majority of U.S. states, and thousands of municipal governments, have used private debt collectors to help recover their debts.

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Bipartisan Plan to Privatize Tax Collection Hits Opposition

The study compared private collections and IRS collections during four consecutive six-month intervals. Taxpayer Advocate Service found that while private collectors collected more tax dollars in the first six-month period than the IRS, over time IRS collections were more consistent. Private collection agencies had six months of success, before drastically decreasing the dollar amount and percentage of available taxpayer dollars collected.

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Social Security Halts Collection of Debts Older than 10 Years

The Social Security Administration announced Monday that it will immediately stop efforts to collect on taxpayers’ debts to the government that are more than 10 years old. This means the SSA will no longer seize state and federal refunds from people who had relatives who owed money to the agency. While the SSA will no longer seize federal and/or state refunds to pay for government debts past the federal statute of limitations, this does not have any impact on other time-barred debts on a state-by-state basis.