Taxpayers complain about Revenue's records, Texas company's attitude
HELENA - Great Falls landlord Charles Henry was surprised when he received notice from a private company out of state, warning him that he owed Montana income taxes.
The state Revenue Department had turned over Henry's account to a Texas collection agency, which is now trying to collect on 25,000 past-due accounts of $200 or less.
"They tried to get me to pay the money to them," he says of the caller for GC Services. "I don't even know them. … I said it's pretty bad when you don't even get a notice from the state first."
Henry also says he believes the bill is in error. But when he called the collection company, GC Services, about it, he says the agent he spoke with was rude.
In a written statement last week, Evan Katz, vice chairman GC Service's board of directors, did not directly address such accusations, but said company employees receive ongoing training in customer service and "complaint prevention."
GC Services, headquartered in Houston, won a contract last October to collect back taxes for the state of Montana, and gets to keep 18.9 percent of what it collects. It is the first time the Montana Revenue Department has hired an outside agency to collect taxes.
The company began trying to collect on $29 million in past-due accounts for individual income taxes five weeks ago. So far, it has taken in only $93,000, a revenue official says.
But the company has raised hackles among some citizens and accountants, who've been hearing from clients who feel the bills are in error.
Other clients also have said the bill collectors, who are calling from Oklahoma, are less than civil when challenged about the bill.
"The problem is they have been rude to people who are trying to clarify their amount," says Jane Egan, executive director of the Montana Society of Certified Public Accountants.
Revenue officials defend the decision to hire GC Services, and say it's an honest attempt to clean up some old, past-due accounts.
"The bottom line is, if our system shows you owe, we need to get that resolved," says Neil Peterson, administrator of the agency's Customer Service Division. "If you owe, you need to make a payment, and if you don't, you need to get that corrected."
The amounts GC Services are attempting to collect range from $10 to $200 per taxpayer and are at least two years old or owed by a nonresident taxpayer.
Each person with a past-due account is supposed to have received at least one written notice before GC Services got the case for collection, and in most cases, two written notices, Peterson says.
Yet Egan says a half-dozen Montana accountants have told her about clients who got calls from GC Services without ever receiving written notice from the state about the debt.
"We even had a CPA who got one of the (calls), and she didn't owe the money and didn't receive any prior notice," Egan says. "The problem with the Department of Revenue is that some of the notices are in error."
In addition to questioning the past-due bill he received, Henry is irritated that the Montana Department of Revenue would hire an out-of-state firm to do the collecting. "Haven't we got enough smart people in Montana to collect back income taxes?" he said.
The state hired GC Services in a competitive bid process. It was one of 17 companies that bid for the contract, including only one from Montana, Peterson says.
Peterson says agency records show that every account passed on to GC Services has received a "statement of account," or initial written bill. "It can't just magically appear on our system without a statement of account," he says.
The Revenue Department calls GC Services "a highly regarded national collection agency," and says it contracts with 14 state revenue departments around the country.
The Web site www.badbusinessbureau.
com, which allows people to anonymously post complaints about companies, lists nine complaints about GC Services in the past six months. Most concern rude or overbearing treatment.