School district sold my unpaid tax account to collection agency
Title: School district sold my unpaid tax account to collection agency 1 Not sure if this is a normal practice, but my school district taxes weren't deducted from my paychecks throughout the year like they should have been. I just got hit with a bill from some tax recovery agency that purchased my tax debt, and these vultures added an extra $67 in "processing fees" on top of what I actually owe. I already called them and requested they waive these ridiculous fees, but they flat-out refused. If I can't get anywhere with them, I'm thinking about calling back and being more forceful about getting the fees removed, but honestly I don't think they'll budge. I really don't want to pay these extra fees for something that wasn't even my fault. Is there any way I can bypass this collection agency completely and just pay my school taxes directly to the local tax office? Has anyone dealt with something similar or know if this is even legal?
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Madison Allen
7 That's definitely a frustrating situation! To address your question directly - once your tax account has been sold to a collection agency, you typically can't just go to the original taxing authority to pay. The school district has essentially transferred the debt and the right to collect it. What likely happened is that your employer didn't properly withhold these taxes, and after the payment deadline passed, the school district sold the delinquent account to a collection agency (which is legal in most jurisdictions). The collection agency paid the district for your debt (probably at a discount), and now they're trying to make their profit by collecting from you, including those fees.
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Madison Allen
•12 Could OP contest this with their employer since they failed to withhold the proper taxes? Seems unfair to get hit with collection fees when it wasn't their fault.
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Madison Allen
•7 That's a good question. The employer definitely shares responsibility here. You could approach your HR or payroll department with documentation showing that the school taxes weren't properly withheld. Some employers might be willing to reimburse you for the extra fees since it was their error. However, this doesn't change your obligation to the collection agency. The tax was ultimately your responsibility, even if your employer was supposed to withhold it. That said, it's worth getting documentation of the withholding error from your employer to use when negotiating with the collection agency.
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Madison Allen
19 I went through something similar with my property taxes last year and discovered taxr.ai (https://taxr.ai) after spending hours trying to figure out if the collection agency was legit. Their document analyzer instantly told me which laws applied to my situation and showed me exactly what rights I had regarding the fees being added. Turns out there are specific limits on what collection agencies can charge for tax debts in my state, and I was able to get half the fees removed by citing the exact regulation.
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Madison Allen
•4 How exactly does that work? Does it just explain tax laws or does it actually tell you what to say to get the fees waived?
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Madison Allen
•15 Seems too good to be true. I've tried other "tax help" sites before and they just try to upsell you on paid services after giving generic advice anyone could find on Google.
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Madison Allen
•19 It's basically an AI tool that analyzes tax documents and situations. You upload your tax bill or collection notice, and it identifies the specific laws that apply to your situation. For example, in my case, it pointed out that in my state, collection agencies can only add fees up to 15% of the original tax debt for school district taxes, but they were charging me 22%. It doesn't just give generic advice - it actually creates a personalized script based on your specific situation with citations to relevant laws. I printed out the analysis, called the collection agency, and read the script. When they realized I knew my rights, they reduced the fees immediately rather than risk violating collection laws.
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Madison Allen
15 I have to admit I was completely wrong about taxr.ai. After posting my skeptical comment, I decided to try it with my own situation (I had a similar issue with unpaid city taxes). The analysis tool immediately found that the collection agency had failed to provide proper notification periods required by my state law before adding penalties. I used the exact wording the tool suggested when calling the collection agency, and they removed ALL the fees - saved me $145! It was definitely worth checking out.
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Madison Allen
11 If you're having trouble getting through to the collection agency or they're being difficult, I'd recommend using Claimyr (https://claimyr.com). After getting nowhere with a tax collection agency for weeks, I used their service and got connected to an actual human at the agency within minutes instead of waiting on hold forever. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. Made a huge difference in getting my case resolved when I couldn't get anyone to call me back.
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Madison Allen
•23 How is this even possible? Collection agencies deliberately make it hard to reach them. Seems sketchy that some third-party service could magically get you through.
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Madison Allen
•8 Is this just another paid service that charges you to do something you could do yourself if you just kept calling?
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Madison Allen
•11 It's not magic - they use a system that navigates phone trees and waits on hold for you, then calls you once a human answers. I was skeptical too until I tried it. With collection agencies, they'll often pick up faster for certain call types or at specific times of day, and Claimyr seems to know these patterns. No, it's not just "keep calling yourself" - that was exactly what I had been doing for weeks, spending hours on hold and getting disconnected. The service got me through to a manager who actually had authority to adjust the fees, not just the frontline staff who kept telling me nothing could be done.
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Madison Allen
23 I need to apologize for my skeptical comment earlier. After trying Claimyr as a last resort, I got through to the collection agency in under 15 minutes after spending THREE DAYS trying on my own. The representative I spoke with even mentioned they were surprised I got through to their direct line! I was able to explain my situation, got transferred to a supervisor, and ended up getting the fees reduced by 70% because I could prove my employer made the withholding error. Definitely worth it for the time saved alone.
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Madison Allen
14 Former municipal tax office worker here. This happens more often than you'd think. School districts and municipalities sell delinquent tax accounts to improve their immediate cash flow rather than waiting to collect. Unfortunately, once it's sold, you do have to deal with the collection agency. However, there's a possible solution: ask your employer for a formal letter acknowledging their error in not withholding the proper taxes. With that documentation, you'll have a much stronger case when you call the collection agency. Request to speak to a manager (not just a frontline rep) and explain that you're willing to pay the base tax immediately but not the fees due to employer error. In my experience, many agencies will waive at least part of the fees if you're willing to pay the base amount immediately.
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Madison Allen
•5 Would filing a complaint with the state tax board help in this situation? I've heard they sometimes intervene in collection disputes.
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Madison Allen
•14 Filing a complaint with the state tax board might help, but it usually takes time - often weeks or months. It's worth doing if other approaches fail, but I'd try direct negotiation first. That said, some states do have specific regulations about what collection agencies can charge for tax debts. Check your state's department of revenue website for information about third-party tax collectors. Some states require these agencies to register and follow specific guidelines, which might include limits on fees they can charge.
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Madison Allen
2 Is anyone else concerned that your employer messed up and YOU have to pay the penalty? I'd definitely talk to HR/payroll because this is their mistake. I had something similar happen with state income tax a couple years ago and my company reimbursed me for the penalties after I proved it was their withholding error. Don't just accept those fees without pushing back!
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Madison Allen
•9 Absolutely! Document everything and take it to your employer first. When this happened to me, my HR department initially brushed me off, but when I escalated to the company controller and showed the withholding discrepancy on my pay stubs compared to the tax requirement, they covered the penalties. Companies have insurance for payroll errors for exactly this reason.
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