We may receive compensation from the companies for the products or services featured on our site. The compensation may affect the order, prominence, or location of specific listings. Advertising Disclosure

IRS notice decoder

IRS Notice CP40: your account went to a private collector

A CP40 says the IRS has assigned your overdue tax account to one of its three contracted private collection agencies. The debt is still owed to the IRS, and the agency cannot file liens or seize anything. The notice includes a Taxpayer Authentication Number that you and the agency use to verify each other on the phone, which also helps you tell a real agency from a scammer.

General information, not tax or legal advice. Deadlines and dollar figures below reflect what the IRS publishes and can change; the controlling dates are the ones printed on your own notice. ClearChoiceRadar is not affiliated with the IRS or any government agency.

How the IRS enforces an unpaid balance

  1. Final noticeLevy rights given
  2. Letter 3172Federal tax lien filed
  3. LevyWages or bank account
  4. CP91Social Security levy
  5. CP508CPassport flagged
  6. CP40Private collection agency you are here

Why you got it, and who is calling

Congress authorized the IRS to use private collection agencies for certain overdue accounts under Internal Revenue Code section 6306. When the IRS was unable to collect your balance, it assigned the account to one of its three contracted agencies, which will contact you to arrange payment.

As of this writing, the three agencies under IRS contract are CBE Group, Coast Professional, and ConServe. Contracts change over time, so confirm any caller is one of these three before discussing your account.

Telling a real agency from a scam

The IRS never uses outside collectors, so this must be fake.
The IRS does use three contracted private agencies for certain overdue accounts. Both the IRS CP40 and the agency's own letter carry a Taxpayer Authentication Number, and on the call you and the agency each provide part of it to verify each other.
I should pay the collection agency directly.
Never. Payments still go to the IRS and the United States Treasury, not to the agency, and never by gift card, prepaid card, or wire. A demand to pay the agency or to use gift cards is a scam. Report impersonation to TIGTA at 800-366-4484.

The limits on the agency

What a private collection agency can and cannot do

The agency can talk to you, take payments made to the IRS, and set up payment plans on terms the IRS allows. It cannot file a Notice of Federal Tax Lien, it cannot levy or seize property, and it cannot take any enforcement action. Those powers stay with the IRS. If you would rather not work with the agency, you can send it a written request to stop contacting you, and your account returns to the IRS.

How to respond

Work out payment

Pay the IRS online, or set up a payment plan. The agency can help arrange one, but the payment always goes to the IRS.

How IRS payment plans work →

Go back to the IRS

Send the agency a written request to stop contact, or ask that your case be returned to the IRS to consider other options. This is your right under the Fair Debt Collection Practices Act.

You cannot pay

Currently not collectible status and the Offer in Compromise exist for real hardship. The agency cannot grant these; they are handled by the IRS.

How the Offer in Compromise works →

CP40 questions

Is a CP40 notice a scam?

The CP40 itself is a real IRS notice, and the IRS does use private collection agencies. Scammers imitate them, though. Verify any caller with the Taxpayer Authentication Number that appears on both your IRS notice and the agency's letter, confirm the caller is one of the three contracted agencies, and never pay the agency directly or by gift card.

Which private collection agencies does the IRS use?

As of this writing, the three agencies under IRS contract are CBE Group, Coast Professional, and ConServe. The IRS updates the list periodically, so confirm the current agencies on IRS.gov and make sure any caller matches one of them before discussing your account.

Can a private collection agency take my property?

No. A private collection agency cannot file a lien, levy, or seize anything. It can only discuss the account and arrange payments that go to the IRS. All enforcement powers remain with the IRS.

Can I get my account back with the IRS instead?

Yes. You can send the agency a written request to stop contacting you, which returns the account to the IRS, or ask that your case be returned to the IRS to consider other payment options. This is a right under the Fair Debt Collection Practices Act.

Sources: IRS: Understanding your CP40 notice, IRS: Private debt collection, IRS: Private debt collection FAQs. The deadline that governs your case is the one printed on your notice.

Want help responding to a CP40?

Compare tax relief companies that handle IRS collection matters. Many offer free initial consultations; check individual providers for details.

Compare tax relief companies

We earn compensation from companies featured on this site. This compensation may influence which companies appear and their placement. Full disclosure