“What’s the difference between a tax collector and a debt collector?”

“What’s the difference between a tax collector and a debt collector?”

"What's the difference between a tax collector and a debt collector?"

“What’s the difference between a tax collector and a debt collector?”

This is a question I was asked recently, and I thought I’d share it with you.

A tax collector works for the IRS, and they handle any cases where money is owed to the IRS.

This is the person who is calling you and letting you know that the IRS says that you owe money.

They only work for the IRS.

(States tend to have their own tax collectors who collect for the Alabama Department of Revenue for example).

But when we say “tax collector” we are talking about an employee of the taxing agency (IRS, Alabama Department of Revenue, etc).

A debt collector buys up or collects on old debt.

A debt collector is someone that buys up old car, credit card, or even student loan debt, and attempts to collect on it.  This is known as a “debt buyer”.

It’s legal for them to buy the debt, if you were curious.

Or a debt collector is a “third party agency” that a company hires to collect debts.  So the debt may still be owned by Capital One but a collection agency is hired to collect the debt.

Debt collectors are notorious for breaking the law which hurts not only consumers but also the honorable debt collectors.

When you find a debt collector violating the law, consider using the FDCPA to stop them.  The FDCPA is the Fair Debt Collection Practices Act.

However, as of 2017, the IRS is shifting some of the tax collection work to debt collectors.

You can read directly from the IRS website about how they are starting to use debt collection agencies on tax debt.

It’s important to know that if either of these guys are calling you, you need to be curious.  So whether it is someone directly from the IRS or a third party debt collector.

Ask them questions and learn what you can.

How did this debt accumulate?

Who are you?

What do I owe?

When did I owe this?

Where did this debt come from?

Why are you calling me on this?

The more you know, the easier it can be to deal with whoever it is, whether it’s a debt collector or a tax collector, and what they need from you.  The basic rule when talking with debt collectors is to gain information so you can then make good decisions.

If you have any questions…

Feel free to get in touch with us.

You can reach us by phone at 1-205-879-2447.

Or, if you prefer, you can fill out a contact form and we will get in touch with you soon. 

Hope this is helpful to you!

We would be glad to answer your questions, and help you figure out the best course of action.

Thanks for reading, and have a great day!

– John G. Watts

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