Illinois Notice of Collection Assignment Checklist
What Collection Assignment Means
The Illinois Department of Revenue contracts with private collection agencies when standard billing attempts, including letters, calls, and emails, have not resulted in payment. Your account moves into active collection after the state has issued earlier notices and a reasonable period has passed without response or payment.
Collection agencies work to recover unpaid tax debt on behalf of the Illinois Department of Revenue. You will receive contact from one of five agencies currently under contract with the state: Harris & Harris, Harvard Collection Services, Transworld System Inc., Linebarger Goggan Blair Sampson, or Alliance One.
Why Your Account Was Referred
Unpaid tax accounts are referred to collection agencies by the Illinois Department of Revenue after previous notices have not prompted payment or contact. A referral occurs when tax payments are not received despite multiple contact attempts and documented billing efforts.
Enforcement Actions the State May Take
Authority to pursue enforcement actions remains with the Illinois Department of Revenue even after referring your account to a debt collector. A tax levy may be issued requiring your employer to withhold up to 15 percent of your gross wages, and you will receive notice of the amount at least 10 days before the levy is sent.
Bank levies require your financial institution to hold all funds in your bank accounts up to the total past due amount for 20 days before forwarding the money to the state. Property seizures can occur for real estate and personal property, with the state providing at least 10 days' notice before seizing assets.
Professional license suspension or revocation can occur when you owe past-due taxes and hold a business or professional license. Notification is sent to you and the relevant licensing authority to initiate suspension or revocation proceedings. Property liens can be filed against your real estate or personal property, preventing you from selling or transferring the property until you pay the past-due amount. These enforcement actions, including tax levy procedures, are carried out by the Illinois Department of Revenue itself, not by collection agencies.
What to Do When Your Account Goes to Collection
Read any correspondence thoroughly and locate critical information, including your account number, the tax years involved, the total amount owed, the name and contact information of the collection agency, any stated deadlines, and instructions for responding. Keep the original documentation in a safe place and make copies for your records.
Verify the debt by confirming that the tax type, tax years, name, and address match your records. Check whether the amount seems reasonable and review whether any payment penalties or late payment charges have been applied correctly.
Gather your tax records for the years in question, including your original tax return, pay stubs, records of tax payments made to the state, documentation of business expenses if self-employed, and records of any tax credits claimed. Contact the debt collector listed in the correspondence and provide your account number when you call or write.
Request a detailed breakdown of what is owed, including the original tax, penalties, and interest. Request information about available options such as payment plans, abatement of penalties, or dispute procedures, including how to file a claim for refund if you believe you overpaid.
Payment Plans and Dispute Rights
Payment plans enable taxpayers to pay their tax debt over time when immediate full payment is not feasible. All required tax returns through the current date must be filed to qualify for a payment plan, and all outstanding liabilities will be part of the same payment arrangement.
Plans are typically set up for 24 months or less, although monthly payment amounts and the length of time depend on the financial condition. Contact the collection agency to request a payment plan and inquire about the possibility of deferring enforcement actions, including tax levies. Also, ask about the consequences of late payment.
Disputing tax assessments remains possible even after the account is referred to a debt collector. An administrative hearing must be requested or a petition filed with the Independent Tax Tribunal within 60 days of receiving a notice informing taxpayers of their protest rights.
Disputes regarding incorrect debt, prior payment, or miscalculation require a written explanation with specific details and supporting documents. Include proof of tax payments and any request for abatement of penalties or claim for refund when submitting disputes to the collections department.
Collection Agency Fees and Additional Costs
Collection agency fees will be added to your existing tax debt when your account is referred to a private collection agency. Any payment penalty assessed for late payment of estimated tax will increase your total balance, making timely resolution with the collections department critical to preventing further costs.
Important Points to Remember
Document every action you take regarding your tax debt, including copies of all notices, letters, payment confirmations, and notes from phone calls with dates, times, and names. Track all tax payments made and maintain records showing when funds were withdrawn from bank accounts or sent by other payment methods.
Respond to all correspondence by any stated deadlines, as missing deadlines can trigger immediate enforcement action. Contact the Illinois Department of Revenue directly if you are unable to reach the collection agency or require clarification on protecting bank accounts from levy action.
Received a State Tax Notice?
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance
