City Income tax
Date: Thu, 03/23/2017 - 10:22
My son in law found out he owes $3800 to IRS in back taxes. They turned him over to Apelles Collection. He is now told they owe $5242 which is 28% more. Can a collection agency add to a debt they are collecting? Also (if yes) how often can they add more interest?
As per the Fair Debt
As per the Fair Debt Collection Practices Act, the debt collectors can charge interest on debts, but they are not allowed to inflate the debt. In general, they cannot charge more than the amount mentioned in the original contract.
In a case of overdue federal taxes, the interest rate is set by federal law.
If you think, the debt collector is inflating your debt amount or you don't owe a tax debt, then give a call to the IRS Referral Unit at 1-866-805-0024.
Yes, interest will be added
Yes, interest will be added when you're paying late. A collection agency can collect unpaid taxes.
