Mildred N. Phillips, Attorney at Law

Consumer Law


If you run into financial trouble and cannot pay your bills on time, the companies you owe money to can and most likely will take steps to collect. However, under state and federal law, there are rules they must follow. These rules apply to creditors and collectors attempting to collect from a Massachusetts resident, even if the company or collector is located out-of-state. These rules DO NOT apply to debts incurred for business purposes, federally guaranteed student loans, unpaid child support and debts owed to the government. Certain regulations also do not apply to debts arising out of money owing as a result of a loan secured by a first mortgage on real property, or in an amount in excess of $25,000.

Massachusetts Debt Collection Regulations prohibit many unfair debt collection practices by creditors and debt collection agencies. Collectors and creditors are prohibited from harassing you in an effort to collect a debt. Creditors and collection agencies may not:

  • Call you at home more than twice for each debt in any seven-day period, or more than twice for each debt in any thirty-day period at some place other than your home, such as your place of work.
  • Call you at work if you have requested that they not call.
  • Call you without identifying both the name of the creditor and the name of the person calling. The caller may use a name other than his or her own, but the creditor or collection agency on whose behalf the call is being made must be able to identify that person.
  • Contact you directly, if you have told the creditor or collection agency you are represented by an attorney.
  • Use profane or obscene language.
  • Cause expense to you in the form of long distance calls, express mail charges, wire fees, or other similar charges.
  • Threaten to have you arrested, or threaten to garnish your wages without telling you a court order is needed for them to do so.
  • Falsely threaten to take legal action that the creditor does not take or reasonably intend to take. 
  • Disclose your debt to a third party - including your neighbors, your employer, or a spouse or family member who is not responsible for the debt without your written consent.
  • Calling and leaving messages with another member of your household with a frequency that would be considered harassing.
  • Calling your neighbors unless it is for the sole purpose of determining your current place of residence.
  • Mail to you any printed or written materials that reveal or imply that you owe a debt (for example, by using a postcard to contact you or using a descriptive return address).
  • Solicit post-dated checks from you.
  • Visit your home at times other than your normal waking hours. A collector may not visit you more than once in any thirty-day period for each debt, unless you give permission for additional visits.
  • Call you at times other than your normal waking hours. If your waking hours are unknown, then the collector may only call between 8:00 a.m. and 9:00 p.m.

NOTE: Creditors and debt collection agencies are permitted to try to locate a debtor by contacting persons other than the debtor or persons residing in the debtor's household, if the creditor or debt collection agency reasonably believes that it no longer has current information on the debtor's location. However, it may not inform anyone it calls about your debt.


Examination of Returns--Audits


Your return may be examined for a variety of reasons, and the examination may take place in any one of several ways. After the examination, if any changes to your tax are proposed, you can either agree with those changes and pay any additional tax, or you can disagree with the changes and appeal the decision.


If Your Return Is Examined


Some examinations are handled entirely by mail.  Examinations not handled by mail can take place in your home, your place of business, an Internal Revenue office, or the office of your attorney or other representative.  If the time, place, or method is not convenient for you, the examiner will try to work out something more suitable.  However, the IRS makes the final determination of when, where, and how the examination will take place.


The Examination


An examination usually begins when you are notified that your return has been selected. The IRS will tell you which records to bring. Any proposed changes to your return will be explained to you or authorized representative. If you agree with the proposed changes, you will sign an agreement with the IRS and pay any additional tax you may owe. If you do not agree with the proposed changes, you can appeal.



If you cannot pay your tax debt in full or you dispute what is owed, you may propose to resolve the matter with an Offer-in-Compromise. The purpose of an Offer in Compromise is to settle a taxpayer's liability for less than the full amount owed. The ultimate goal is a resolution that is in both the government's and the taxpayer's best interest.

An examiner will evaluate your offer and may request additional documentation from you or your authorized representative to verify financial or other information you provide. If the IRS decides a larger offer amount is necessary to justify acceptance, you will be given an opportunity to amend your offer.

If the IRS grants you a fresh start by accepting your offer, it is expected there will be no further delinquencies. If you do not abide by all the terms of our agreement, including filing all future returns and making all payments when required, your offer may be declared in default. The IRS will reinstate the entire liability including accrued penalty and interest. All payments made toward the offer will be applied to the original liability.

If the IRS rejects your offer, you will be notified by mail and provided with the reasons for the rejection.


When can DOR accept an Offer in Final Settlement?

The Commissioner of Revenue may accept an Offer in Final Settlement when:

  • There is doubt about the collectibility of the tax. This generally means that the taxpayer cannot pay the full amount owed or that the liability cannot be collected, and
  • The Commissioner believes that accepting an Offer will be in the best interest of the Commonwealth.

When can I make an Offer in Final Settlement?

An Offer in Final Settlement will be considered only after the taxes to be settled have been assessed or are deemed to be assessed and prior to collection of the amounts due. To make an Offer in Final Settlement for taxes due with returns not yet filed, a taxpayer must submit returns at or before the time the Offer is submitted.

How do I make an Offer in Final Settlement?

A taxpayer may submit an Offer in Final Settlement only by completing certain forms. The taxpayer may also be required to provide other documentation to support the taxpayer's claim that the liability cannot be paid in full. Incomplete or vague answers to questions may lead to delays in processing your offer or they may lead to its rejection.

How much should I Offer?

The minimum amount that the Department normally expects that you could pay and therefore the minimum amount it expects you to offer in settlement is:

(a)     The total DOR could expect to realize from a forced sale of your assets (after paying off any senior secured creditors such as your mortgage holder, if applicable, and after paying any expenses of the sale). Plus

(b)     the amount you could expect to pay from your future income over the course of the next four years (after allowing for normal living expenses, determined in reference to standards for family size and where the taxpayer lives).


What other factors affect the evaluation of an Offer?

The Department considers other factors in determining whether or not to accept an Offer in Final Settlement. Among these would be:

  1. Repeated non-compliance or attempts to avoid paying an obligation weigh against accepting an offer.
  1. Evidence that the taxpayer has the ability to pay the tax in full or to pay significantly more than the amount offered, either by liquidating assets, including pension funds, or by means of a payment agreement over a reasonable period of time may result in rejection of an offer.
  2. The potential for an increase in the taxpayer's earnings, the value of their assets or a decrease in expenses or the value of liabilities, particularly when collection activity has been pursued for only a limited period of time, may result in rejection of an offer.
  3. The omission of information about assets or income on present or previously submitted financial statements may be grounds for rejecting an Offer in Final Settlement. Failure to respond to requests to clarify or document information on the financial statement may also result in rejection of an Offer in Final Settlement.


  • Do not routinely carry your social security card or birth certificate in your wallet or purse.
  • Disclose your social security number only when absolutely necessary. Social Security numbers were implemented as a method for accounting your taxable earnings, not as a universal identifier.
  • Change your driver's license number to a randomly assigned "S number." When you pay by check, the seller can only record your name, address, driver's license or Massachusetts ID number, and your choice of a home or daytime number. If you have a random license number, you avoid disclosing your Social Security number every time you pay by check.
  • Check your wallet or purse for any cards, such as a health insurance card, that uses your social security number as an identification number. Contact that particular service provider and ask if they would be receptive to using a different number for identification.
  • Carry only those credit cards you use regularly, and cancel all unused credit cards.
  • Keep an accurate list of all credit cards and bank accounts including the name, mailing address and telephone number of the creditor, the account number, and expiration date. Update the list regularly and keep it in a secure place.
  • Closely review all credit card statements each month to detect unusual activity or unauthorized charges.
  • Destroy pre-approved credit card solicitations and to reduce the number of such solicitations, contact all the three major credit reporting bureaus in writing and "opt-out" of pre-screening lists.
  • As a Massachusetts resident, you are entitled to a free copy of your credit report each year. Exercise this right, and check your credit report closely for accuracy.
  • Do not use your year of birth or other easily identifiable code as a password or personal identifying number ("PIN") for credit cards or ATM machines. Do not allow others to closely view as you enter your password or PIN.
  • Destroy all credit card and ATM receipts and do not discard them in banks or retail establishments.
  • If you suspect that your mail is being stolen or tampered with, contact your local post office or postal inspector.
  • Never give your PIN number out to someone over the telephone even if they say that they work for the bank or financial company in question.
  • Be very cautious about sending personal identifying information over the Internet.
  • Discuss with children who use the Internet the importance of not giving out personal information.


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