Tax Season Debt Collection Strategies and Why They Matter
Many retailers make or break their year based on the success of the holiday shopping season. The period between Black Friday and the year’s end represents nearly 50% of some retailers’ annual sales. The same is true of the collection industry during tax time, a period in which IC System’s collections can increase by up to 30% for our clients. The reason for this is simple: consumers receive their tax refunds and often use them to pay off their past-due accounts. The trick is being the first creditor on the consumer’s list to reimburse.
Being at IC System before and during tax season is sort of like going into Target on November 1, when they’ve put away the Halloween décor and replaced it with buffalo plaid patterns and aisles of Christmas tree baubles. It’s a complete shift. Everyone in IC System has tax season on their minds. Everyone’s working toward the same goal: recover more for our clients by making sure they’re first on the consumer’s list. So, how do we do that?
Well in advance, our analysts have mined our extensive data warehouse, as well as information on refund dispersal patterns, to predict the trends of this year’s tax season. When will consumers receive their refunds? When is the best time to send additional letters and launch targeted tax season campaigns? These are some of the questions we must answer to get in front of consumers and have a successful tax season.
IC System also prepares for tax season the way many retailers do, with seasonal training. We tailor our collection strategy to ensure our representatives can find positive financial outcomes for consumers. Our representatives, new and tenured, take a unique tax season course designed by our training department to maximize the active listening skills required to find a satisfying outcome for all involved. We coach negotiation skills that include payment arrangements, which can begin late in the fourth quarter or early in the first quarter, so consumers have payment plans on file before resolving their account with the arrival of their tax refund. In some cases, when applicable, we also negotiate settlement amounts for a lump sum or multi-payment resolutions.
Moreover, our clients can ensure a higher rate of return during tax season by placing more accounts with IC System. It’s vital that creditors take advantage of tax season by clearing out any accounts receivable backlogs and submitting them to collections as soon as possible. Just like holiday shoppers getting the best deals during Black Friday and Cyber Monday, clients with bad debt on their books will get the most out of IC System by submitting accounts for collection as soon as possible.
About the Author: Brian Eggert
Brian Eggert is a business development specialist and writer for IC System, one of the largest receivables management companies in the United States. With 18 years in the collection industry, Brian's experience includes operations, client service, proposal writing, blogging, content creation, and web development.