IRS Private Debt Collection — What Businesses Need to Know — Definition Glossary

Defined by Sarah Mitchell, CPA | Reviewed by: James Okafor, EA | Updated May 2026

Full Definition

The IRS uses private debt collection agencies (PDCAs) to collect certain “inactive” tax debts that have been assigned out of normal IRS collection channels. Currently authorized PDCAs include: CBE Group, Coast Professional, Conserve, and Performant Recovery. The IRS assigns cases to PDCAs when: the case is assigned to a queue with no Revenue Officer contact for over a year, or the balance is over a specified threshold and the IRS lacks resources to actively collect. PDCA contact is initiated by an IRS notice (CP40) informing the taxpayer their account has been transferred. PDCAs can only request payment — they cannot issue levies, file liens, or take collection action. If a taxpayer is represented by a tax professional, the PDCA must contact the representative rather than the taxpayer directly. Businesses that receive PDCA contact should take it seriously — it means the IRS has not forgotten the debt and will eventually reassign it to a Revenue Officer if the PDCA cannot collect.

Why This Matters for Businesses With Tax Debt

Understanding IRS Private Debt Collection — What Businesses Need to Know is essential for any business owner navigating IRS enforcement or business tax debt. This term directly affects the resolution options available — including whether tax debt financing is a viable solution, how federal tax liens affect the business, and what the IRS can legally collect.

Related Tax Terms

• IRS Automated Collection System
• IRS Revenue Officer
• Installment Agreement

Is Your Business Facing This Situation?

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Type of Tax Debt *-- Select Tax Debt Type --IRS 941 Payroll Tax DebtFederal Tax LienIRS Bank Levy (Active Now)Trust Fund Recovery Penalty (TFRP)State Tax DebtOIC Bridge FinancingMultiple Types

Approximate Tax Debt Amount *-- Select Amount --$10,000 - $25,000$25,000 - $50,000$50,000 - $100,000$100,000 - $250,000$250,000 - $500,000$500,000+

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Sources: IRS.gov; Internal Revenue Code (IRC); IRS Publications 1, 594, 1660, 594. Tax Funds is a financing marketplace — not a lender, CPA firm, or law firm. Content is for informational purposes only and does not constitute tax or legal advice.