Pros and Cons of Becoming a Tax Collector
Tax collectors ensure that overdue taxes get paid. Read below to review both the pros and cons of a career in tax collecting.
|PROS of Becoming a Tax Collector|
|Demand continues in economic downturns (governments need taxes collected to increase budgets)*|
|Tax enforcement in the federal government is expected to increase, leading to more job openings*|
|Solid average earnings (about $57,000 as of 2014)*|
|Degree not always required for local and state positions*|
|CONS of Becoming a Tax Collector|
|Confrontational situations and stress involved with collecting debt*|
|Bachelor's degree is required for federal positions*|
|During tax seasons, overtime is often required*|
|Travel may be required to meet with or investigate debtors*|
Source: *U.S. Bureau of Labor Statistics.
Essential Career Information
When a taxpayer is overdue on payment, you, as a tax collector, will send out a notice. This document details what the taxpayer needs to do to settle his or her debt. If the taxpayer takes no step to contact you, you may contact him or her by phone. The taxpayer might agree to pay the debt up front or arrange for a payment plan. Some taxpayers fill out claims stating that they cannot pay their taxes. In such cases, you'll investigate the claims by examining claimants' financial statements and gathering financial information from their neighbors. You might also determine the value of their assets, like homes, cars and bank accounts, and take claim of such assets to settle the debt. You also have the right to garnish a person's wages to collect the debt.
Tax collectors work for governments at the federal, state and local levels. Those who work for the Internal Revenue Service are called revenue officers. You'll typically work full-time, though you'll often work longer hours during tax season. While you'll spend most of your time in an office, you may have to travel to visit taxpayers.
Salary Information and Job Outlook
The U.S. Bureau of Labor Statistics (BLS) reported that the average salary for tax collectors was around $57,000 as of May 2014 (www.bls.gov). This resulted in an average hourly wage of roughly $27. The federal executive branch paid tax collectors the highest average salary at about $67,000. State governments paid about $52,000 on average per year, while local governments paid an average salary of about $46,000.
The BLS projected that jobs for tax collectors would decline by four percent from 2012-2022. While this growth is slow, it's important to note that tax collector employment often endures through economic downturns; when government budgets shrink, professionals are needed to recover unpaid taxes and increase the budget. The best prospects will be in federal government, which is expected to have a rising demand for tax enforcement.
Education and Training Requirements
You may not need a bachelor's degree to work at the state or local levels; however, a bachelor's degree is required for employment at the federal level. You might earn a degree in business, finance, accounting or another applicable major. You may also benefit from taking courses in tax analysis and bookkeeping. To obtain employment at the state or local level without a degree, you'll generally need related work experience, such as in collections, credit management or customer service.
After getting hired, you'll complete a mixture of on-the-job and formal training. As an entry-level tax collector, you'll start out working under the guidance of an instructor before handling cases on your own.
Due to the many documents a tax collector has to work with and the sensitive nature of the material, many employers want tax collectors with excellent organizational skills. For this same reason, a strong eye for detail and the ability to analyze large amount of information is also essential. Additionally, interpersonal skills are beneficial for this career; if you're comfortable around people, then you can remain firm and composed when collecting taxes from someone.
What Employers Are Looking for
While different levels of government have different requirements for tax collectors, many prefer applicants with experience related to the field. In local or state settings, these professionals may serve dual roles as both a tax collectors and another related position, like a clerk. Below are samples of April 2012 job postings for tax collectors to give you an idea of what real employers were looking for:
- A federal agency was looking for a tax collector to work in its small business/self-employed division located in New York. This is an upper-level position that requires applicants to have previous experience in federal tax collecting.
- A town in Maine was looking for a tax collector/municipal clerk to collect taxes and fees as well as performing various administrative duties. The employer prefers applicants with previous municipal experience.
- A New Mexico tax and revenue department wanted a tax collector/examiner to collect payments from individuals and businesses. The applicant needs a high school diploma, a valid driver's license and one year of experience in bookkeeping, accounting, finance, auditing, collections or another related field. Applicants also need to be current on their taxes.
Standing Out in the Field
While local and state tax collectors may not be required to hold bachelor's degrees, many do, so you might improve your chances of employment by earning a degree. You may earn your degree in accounting or finance, but be sure to also take courses in communications, which may prove beneficial for your career. Additionally, you can stay abreast of new regulations by continuing your education throughout your career. For example, when tax laws are modified, you might research the new regulations independently or attend meetings administered by your employer to learn about how they impact the collection process.
Other Career Options
If you like working with numbers, but you don't want to collect taxes, consider a career as an accountant. In this occupation, you'll examine the financial records of your employer or clients in order to make sure all fiscal reports are accurate and in compliance with regulations. You might also find ways to reduce costs or improve profits for your employer. You'll need at least a bachelor's degree in accounting or a related field for this career, but the rewards are greater than those of tax collectors; The BLS reports that the average salary of accountants was about $70,000 as of 2011, and jobs were expected to grow by 16% from 2010-2020.
If you'd rather provide people with money than collect money, look into becoming a loan officer. In this career, you'll meet with clients and determine if they're eligible for the loans they've applied for. This involves asking them financial questions and gathering personal information. Depending on the income and credit rating of the client, you may be able to present the client with loan options and help him or her complete the loan process. You may enter this career with only a high school diploma, unless you want to become a commercial loan officer, which requires a bachelor's degree. Also, if you work with mortgage loans, you'll need to become licensed to do so.
Loan officers made an average salary of around $68,000 as of May 2011, according to the BLS. The BLS also reports that jobs were expected to grow by 14% from 2010-2020.