IRS Releases Letter to Be Sent to Taxpayers Assigned to Collection Agency

The IRS has released a copy of the letter that they will send when accounts are sent to an outside collection agency.  The new letter, Notice CP40, will be used when the IRS forwards accounts to a collection agency in the cases Congress required that step to be taken when it passed the Fixing America’s Surface Transportation Act in December of 2015.

The form will assign the taxpayer a “Taxpayer authentication number” which will be found in the upper right section of the first page of the notice. The first five digits of that number will need to be provided to the collection agency before the collection agency will be able to assist the taxpayer. This will serve to confirm to the agency that the person on the phone is the taxpayer.  The agency will then recite the final five digits of the taxpayer authentication number to allow the taxpayer to confirm that the collection agency is the party calling.

In addition, the taxpayer will need to provide the collection agency with the name and address of record before any assistance can take place.

The IRS has also issued a new publication, Publication 4518, What You Can Expect When the IRS Assigns Your Account to a Private Collection Agency. The publication notes that the collection agency will send the taxpayer a letter initially confirming assignment of the account to that agency.