Dealing with the IRS when you have outstanding tax debt is already a headache. But what if they assign your account to a private collection agency?
This can happen, especially if your account has been inactive for a long time or the IRS can’t reach you. The IRS has three companies it works with regularly, including CBE Group, Coast Professional, and ConServe.
If you’ve received communication from CBE Group, what do you do next? And how do you know it’s real and not just a scammer? This post covers everything you need to know about this third-party agency.
Key Takeaways:
- CBE Group – one of three private agencies authorized by the IRS to collect overdue tax debt.
- CBE’s rights – this agency can communicate with taxpayers and explain options, but cannot take enforcement actions, like issuing liens and levies.
- IRS Notice CP40 – alerts you that your account was assigned to a collection agency and includes a 10-digit taxpayer authentication number.
- Tax payments – must still be made directly to the IRS, not to CBE Group.
- When to contact a tax pro – If you dispute the debt, can’t pay, or suspect a scam, it’s always a good idea to consult a tax attorney.
Is the CBE Group a Legitimate Company?
CBE Group is a private collection agency that the IRS relies on for collections assistance. Since 2015, the IRS has actually been required to send some accounts to a third party. These agencies contact taxpayers about making payments and exploring tax resolution options.
The IRS frequently works with CBE Group, which is based in Waterloo, Iowa. CBE also works with non-governmental organizations, including the healthcare, utilities, telecommunications, retail, and financial services industries.
As of 2025, the IRS only works with three third-party collection agencies. If another company outside of CBE Group, Coast Professional, or ConServe contacts you claiming to be contracted by the IRS about outstanding tax debt, it’s probably a scam, so ignore it and never provide sensitive information.
How to Know a Collection Agency Is Legit
The IRS recognizes that taxpayers may be wary of a separate company contacting them about taxes. As such, it has implemented a clear process so you can confirm that CBE Group is contacting you about real debt and is legitimate. These are the steps in the process:
The IRS Sends You Notice CP40
You should always receive Notice CP40, Account Assigned to Private Collections, from the IRS before any other company reaches out. This notice outlines who your debt is being transferred to and their contact information. Publication 4518 will also be included with this notice.
CBE Group Contacts You
After the IRS notice, expect contact from CBE Group. They will send you a letter confirming the assignment and your details. They may ask to set up a phone call with you to get collections started. Confirm that the address and phone number provided match those on the IRS notice or IRS website, as follows:
- Address: PO Box 2217, Waterloo, IA 50704
- Phone: 800-910-5837
Verify Your Taxpayer Authentication Number
On your IRS CP40 Notice, you’ll see a unique 10-digit number at the top. This is your new taxpayer authentication number to use with the third-party agency. When CBE Group contacts you, they’ll ask you for the first five digits, and they will provide the last five for verification. Make sure the number matches exactly what the IRS provided to you.
Beware If Asked to Pay CBE Directly
Another important consideration is that you will never make tax payments to an outside company. You will still only pay the IRS. The company just helps you through the process and tries to get you to pay. Your options are still to send a check or money order through the mail to the IRS or pay using your IRS online account, Direct Pay, or the Electronic Federal Tax Payment System (EFTPS).
Follow Your Gut
If you know that you’re up to date on your tax returns and tax payments, be wary of any communication about unpaid taxes from a third party. If you did miss something and owe taxes, the IRS will have already tried to contact you with notices and letters. If something doesn’t feel right about a communication from someone claiming to be the IRS or a collection agency, don’t provide your information and report the incident.
How the Process Will Work with CBE Group
So, what will it be like to work with CBE Group? First, they’ll contact you by mail. This will come after the IRS’s CP40 Notice. The letter will verify your information and will likely request a phone call with you. CBE Group could then call you after they send you the letter.
An important note: any communication you have with CBE Group should reference your 10-digit authentication number provided by the IRS. This includes phone calls. If the number isn’t referenced, do not provide your information.
CBE Group will explain your options for making your tax payment and answer questions you have about your balance. They can also walk you through resolution options you may qualify for, including:
- Payment plans with the IRS to pay off your balance with smaller monthly payments
- Offer in compromise requests to settle the debt for less
- Currently not collectible status for a temporary pause on collections
CBE Group works on the IRS’s behalf, but they cannot negotiate with you or settle your debt with you. They also cannot take enforcement actions like issuing levies against your property or filing federal tax liens. The IRS will take these actions or make decisions about your applications and requests.
What Are Your Rights with CBE Group?
As a taxpayer, you have certain rights when interacting and working with a private collection agency like CBE Group. Here are a few basics provided under the Fair Debt Collection Practices Act (FDCPA):
- Collection agencies cannot use threats or harassment when trying to collect.
- They cannot engage in deceptive or abusive conduct.
- They must call at reasonable times; i.e., not late at night.
- They must comply with your requests to stop communication.
- They must only provide accurate information to you.
In your contact with CBE Group, if they violate these rights, you can file a complaint or let the IRS know. You have the right to stop working with a private collection agency if you so choose, and you can make your request in writing to the agency. When you’re not sure what to do, talk to a tax professional, who can help with communications and protecting your rights.
When Should You Contact a Tax Attorney?
Some tax issues can be resolved on your own. For instance, if you have an outstanding balance and are contacted by CBE Group, you can simply make your full payment if you can afford it. Then, the IRS will stop charging you penalties or taking enforcement actions.
However, certain situations warrant a tax attorney, including the following:
- You owe a very high balance to the IRS.
- You have been contacted by the IRS and/or a private agency, and you don’t agree with the amount on your account.
- You are current on your tax obligations and don’t recognize the debt they are claiming you owe.
- You can’t afford to pay your tax debt right now.
- You need more information about tax resolution or relief options that the IRS offers.
- You want to prevent tax liens or tax levies.
- You are unsure if the company that contacted you is legitimate.
A tax attorney can help you with each of these situations and more. They understand tax laws that apply to you and can ensure you are taking every step possible to resolve your tax debt. They will also make sure that the IRS and private collection agencies are not violating your rights.
Choose the Tax Experts at Seattle Legal Services
Getting communications from a third-party debt collector can feel overwhelming and confusing. You need to be sure the company is legitimate, but you also may not be aware of what your rights are or what the agency can and can’t do as far as enforcement actions.
Talk to the team at Seattle Legal Services for assistance. Our attorneys can help you understand your rights and where you are in the collections process. We’ll communicate with the IRS or a third-party agency on your behalf while helping you enter into an arrangement to get your debt paid off as fast as possible. You may qualify for another option like an offer in compromise or currently not collectible status to find some relief.
Contact our tax attorney now for a consultation.
FAQs about CBE Group and Tax Debt Collection
What Does the CBE Group Collect?
The CBE works on behalf of the IRS to collect outstanding tax debt. The company is a private collection agency that can communicate with taxpayers and explain options for repayment, but it cannot take enforcement actions.
Is CBE Group Legit?
Yes, CBE Group is a legitimate agency that works with the IRS for tax debt collection. However, there are consumer complaints through the Better Business Bureau about working with CBE Group. Some scammers may also pose as a legitimate agency while trying to get your information or money. Be sure to confirm with the IRS and verify your taxpayer authentication number before moving forward.
What Happens If You Ignore Debt Collectors?
If you do nothing after receiving communications from CBE Group, another private collection agency, or the IRS, your tax debt will continue to increase with penalties and interest charges, and the IRS will start to ramp up its collection actions against you. This could lead to the IRS filing a federal tax lien or issuing a tax levy to seize your property.
Working with third-party collection agencies is just one way the IRS tries to get taxpayers to pay their debt, and you should never ignore notices or letters.
Why Does the IRS Use Private Debt Collectors?
The IRS is now required by law to send certain types of taxpayer accounts to private collections in an effort to get taxpayers to pay what they owe. The IRS may assign your case to a third-party collector if they’ve been unable to reach you or you have had a tax balance that you haven’t paid for a long time.
Sources:
https://www.irs.gov/businesses/small-businesses-self-employed/private-debt-collection
https://www.irs.gov/individuals/understanding-your-cp40-notice