21.3.4  Field Assistance (Cont. 3)

21.3.4.11 
IMF Entity Overview

21.3.4.11.4  (10-29-2010)
Invalid Secondary SSN

  1. If the secondary identifying number shown on the prior year return does not match our records, see IRM 21.3.1.4.41, CP 58 Notice of Spouse’s Missing SSN for the procedures the taxpayer should follow to correct the information.

21.3.4.12  (10-11-2012)
Account Inquiries

  1. An account inquiry is a contact relating to a taxpayer's tax account or entity information dealing with the processing of tax returns and corrections of subsequent errors.

    Caution:

    When assisting a taxpayer on an account inquiry, it is common to encounter issues that have tax law implications. Be sure to use the appropriate tax law procedures during the account contact. For more information, see the following:

    • IRM 21.3.4.3.5, Tax Law Assistance

    • IRM 21.3.4.3.6.3.2, In-Scope Tax Law Referrals

    • IRM 21.3.4.3.6.5, Out of Scope Procedures

  2. Most accounts are resolved online or as a result of a written referral.

  3. Online resolution is generally completed while the taxpayer is still in the TAC. However, if all account-related actions are completed by close of business (COB), it is considered closed online.

  4. Any inquiry that is not resolved and closed the same day is a written referral.

    1. All actions must be taken and taxpayer contact must be made to be considered closed.

    2. Refer to IRM 21.3, Taxpayer Contacts for guidelines on closing actions for referrals/correspondence and instructions to taxpayers.

  5. The authority to take oral statement was established to close account inquiries online.

  6. Oral statement allowances can be accepted by all IRS functions. (See IRM 21.1.3.20, Oral Statement Authority for additional information on the expanded authority)

    Caution:

    Due to increasing incidents of taxpayer accounts becoming the subject of identity theft, be cautious when disclosing information and transactions related to the taxpayer visiting the TAC office.

  7. See IRM 21.5, Account Resolution for specific adjustment procedures on resolving taxpayer issues.

  8. See IRM 21.4, Refund Inquiries for procedures on resolving refund contacts.

21.3.4.12.1  (03-25-2013)
Account Management Services (AMS)

  1. This is a computer-based system used to answer and resolve all taxpayer account related inquiries. AMS provides a common interface that allows users of multiple IRS systems to view history and comments from other systems and to access a variety of case processing tools without leaving AMS.

  2. All employees are required to use AMS to research, document and resolve all account contacts, adjustments, and account referrals. Employees are required to identify the appropriate issue, in AMS, and add complete narrative explaining the contact. Employees are required to identify and create the appropriate issue in AMS, and input history for ALL account accesses. This includes researching information to assist in posting a payment. When only posting a payment on AMS, the automatic history input will be sufficient documentation.

    Note:

    Field Assistance is required to use the AMS Disclosure Tool to perform taxpayer authentication, when available. If AMS is unavailable, disclosure is to be completed per IRM 21.1.3.2, General Disclosure Guidelines.

    Exception:

    Employees will complete Form 11377, Taxpayer Data Access in performing their normal tax administrative duties to document an access performed in error. An AMS history entry will not be required during this circumstance.

  3. When AMS is not available, and account work is completed on IDRS, certain history items can be put directly on IDRS (see IRM 21.2.2.4.2.1, IDRS History Items and Account Inquiry) or you can input the AMS history once AMS is available.

  4. AMS features include:

    • Checklist with links to IRM references and IDRS commands to ensure that employees take all necessary steps for case closure. Actions taken within the checklist leave narrative history, eliminating the need for manual entries.

    • A pay-off calculator that automatically calculates penalties and interest, and the total balance due on each active module and provides the total balance due for multiple modules for any designated period.

    • Customized (pre-formatted) letters requiring limited input for frequently used paragraph combinations.

    • Automatic forms and worksheets.

    • Reasonable Cause Assistant (RCA) is a decision support system designed to evaluate penalty relief requests. All employees must use the RCA tool if they have AMS, to provide consistent and accurate decisions for penalty relief requests.

    • Integrated Automation Technologies. See IRM 21.3.4.12.2, Integrated Automation Technologies (IAT).

    • Reports – This includes a TIN summary report that will show all TIN’s you have accessed in AMS between the dates you enter. Managers and referral coordinators have access to additional reports to manage inventories.

    Note:

    See IRM 21.2.1.8, Account Management Services (AMS) for a detailed listing of additional AMS features.

  5. See IRM 1.4.20.17.5, Accounts Management Service (AMS) for manager information and procedures.

21.3.4.12.1.1  (10-01-2013)
Account Management Services e-ACS Guide

  1. All employees are required to use the Electronic Automated Collection System http://serp.enterprise.irs.gov/databases/irm-sup.dr/e-acsg2.dr/index.html checklists to assist in resolving balance due inquiries.

    • The e-ACSG checklists link is on AMS under "Tools" .

    Note:

    The Accounts checklist is not required for Field Assistance Employees.

  2. Employees who do not have their computer located at the TAC counter should print a copy of the appropriate checklist for use during the contact, to ensure all issues are covered.

  3. Employees should not print the checklist if a referral is made to another FA employee.

21.3.4.12.1.2  (03-21-2013)
Account Management Services Letters

  1. AMS provides customized letters for use in resolving many account related inquires and in house adjustment. All employees will use the appropriate letters in AMS and/or the Correspondex http://serp.enterprise.irs.gov/databases/forms-ltrs-pubs.dr/crxltrs.dr/crx_letters.toc.htm. system to timely respond to taxpayers inquires and adjustment request.

21.3.4.12.1.3  (10-01-2010)
Additional AMS References

  1. For additional information on AMS you may refer to the following IRM references:

    IRM References Title
    IRM 21.2.1.8 Account Management Services
    IRM 21.3.4.3.6.3.3 In-Scope Account Referrals
    IRM 21.2.2 Research
    IRM 20.1.1.3.6 Reasonable Cause Assistant (RCA)

21.3.4.12.1.4  (10-01-2013)
Account Management Services Problem Log

  1. Employees experiencing problems with AMS should print and complete the problem log and submit it to your manager for routing to the appropriate Area AMS Analyst. See http://win.web.irs.gov/field/fadocs/jobaids/AMS_Problem_Log.pdf.

21.3.4.12.2  (10-01-2013)
Integrated Automation Technologies (IAT)

  1. IAT allows the user to access IDRS information in different ways. The IAT tools are designed to assist employees with IDRS research and resolution of taxpayer issues. The use of the IAT tools is mandatory.

    Reminder:

    The AMS Checklist is still required.

    Note:

    Employees working Identity Theft (IDT) case work will refer to IRM 21.2.2-2, Accounts Management Mandated IAT Tools for a list of IAT tools.

  2. IAT provides advanced computer processing tools, sharing of key business data and applications that interact with IDRS and a variety of other systems to help the user determine the correct actions to be taken and complete the actions required to process the account.

  3. Certain tools require managerial approval. Tool availability is based on an employee training and skill level. Once approved, you should have the appropriate IDRS command codes that correspond to the approved IAT Tool, in your profile. For a specific list of mandated IAT tools for Field Assistance, refer to Exhibit 21.3.4-35, Field Assistance, Mandated IAT Tools. All job aids are located at the IAT website. Although numerous job aids are available, FA will have access to IAT tools to assist with face to face contacts and Identity Theft (IDT) inventory work.

  4. First time users will follow the instructions outlined at the http://idap.web.irs.gov/IAT to install the IAT Task Manager (ITM) icon to their desktop. After the initial installation, you will use the desktop icon to access the ITM.

  5. For problems with an IAT tool or if the IAT Task Manager is not available, continue IDRS case process using established procedures. See the http://idap.web.irs.gov/IAT on how to report problems with IAT tools.

    Note:

    For more information on IAT, refer to IRM 21.2.2.4.4.14, Integrated Automation Technologies.

21.3.4.12.2.1  (03-01-2013)
Manual Refunds Using Integrated Automation Technologies (IAT)

  1. All employees will use IAT Manual Refund Tool when initiating, monitoring and processing request for manual refunds.

  2. The ITAS will use IAT to automatically complete, monitor, and process Form 5792 - Request for IDRS Generated Refund and Form 3753 - Manual Refund Posting Voucher.

    Note:

    In the remarks box of Form 5792 add the following statement in "RED" W&I:FA:CARE. Do not generate cc RFUNDR until the approving official has signed and approved Form 5792.

  3. Group, Territory Managers, and certain non-management officials (Area Analysts, Technical Advisors, etc.) have the authority to sign manual refund requests. Areas will identify which Managers, Territory Managers, or Area Directors will sign manual refunds. Contact your Manager for guidance if unsure of appropriate signature authority.

    Note:

    See IRM 3.17.79.3.5, Employees Authorized to Sign Requests for Refunds.

  4. Managers should review and approve all IAT manual refund requests prior to submitting the form(s) to the individual with the authority to sign manual refunds in Field Assistance.

  5. IRM 21.4.4, Refund Inquiries, Manual Refunds will be used for complete guidelines and procedures on identifying, working, processing, and monitoring manual refunds.

  6. If the Area has designated the Group Manager with signature authority, complete all of the following actions:

    • Sign the manual refund request.

      Note:

      In the remarks box of Form 5792 add the following statement in "RED" W&I:FA:CARE

      .

    • Fax a copy and all supporting documentation to the Manual Refund Team on the same day of input into IAT. See IRM 21.4.4-3, Accounting Function - Manual Refund Team Contact Information for a list of contacts.

    • Call the Manual Refund Team to alert them to the fax.

      Note:

      See IRM 3.17.79.3.3.1, Actions Required Before Requesting Refunds for additional information.

  7. If the Area has designated the Area Director, Territory Manager, or other non-management official with signature authority, the following actions are to be completed by the ITAS to obtain their signatures:

    • ITAS will print and review Form 5792, Request for IDRS Generated Refund (IGR).

    • Group Manager will review and initial Form 5792 (in the corner of the signature box).

      Note:

      Ensure the remarks box of Form 5792 has the following statement written in "RED" W&I:FA:CARE

      .

    • Fax a copy and all supporting documentation to the designated signing official.

      Note:

      The signature of the designated signing official certifies to the Accounting Function that the form was reviewed and is correct. (The Campus will store a hardcopy of the form as a paper trail.)

    • The designated signing official will sign Form 5792 and advise the controlling TAC Manager of the approval of the manual refund.

    • Fax a copy and all supporting documentation to the Manual Refund Team on the same day of input into IAT. See IRM 21.4.4-3, Accounting Function - Manual Refund Team Contact Information.

    • Call the Manual Refund Team to alert them to the fax.

      Note:

      See IRM 3.17.79.3.3.1, Actions Required Before Requesting Refunds for additional information.

      Reminder:

      Employees must use command code CMODE (change mode) to access and update taxpayer records on another Campus’ database. For additional guidance see IRM 2.3.9.9, CMODE.

21.3.4.12.3  (10-01-2011)
Audit Reconsideration

  1. FA employees will assist taxpayers when they disagree with an assessment made because of an audit on their tax return or when the taxpayer contests a Substitute for Return (SFR) determination by filing an original return.

    Note:

    If –W Freeze is present on the module see Caution in IRM 21.5.6.4.46, -W Freeze prior to taking any action on the account.

  2. In order to request an audit reconsideration:

    1. The taxpayer must have filed a tax return or received an SFR assessment.

    2. The assessment remains unpaid or the Service has reversed tax credits that the taxpayer is disputing.

      Note:

      If the taxpayer has paid the tax, they should file a formal claim to contest the tax deficiency assessment (Form 1040X)

      .

    3. The taxpayer must know which adjustments they are disputing.

    4. Taxpayer must provide additional information not considered during the original examination.

  3. For general procedures regarding audit reconsideration requests see:

    1. IRM 4.13.1.4, Criteria for Reconsideration

    2. IRM 4.13.2.1, Research/Initial Case Screening

    3. IRM 4.13.2.1.1, Criteria Met

    4. IRM 4.13.2.1.2, Criteria Not Met

    5. IRM 4.13.2.2, Function Responsible & Routing Instructions

    6. IRM 4.13.2.3, Role of Contact Employees when a Reconsideration Request is Received and the Examination was Performed in the Area Office or Campus Examination Function

21.3.4.12.3.1  (10-01-2009)
Automated Substitute for Return (ASFR)

  1. The ASFR is a non-filer or return delinquency program. The program computes tax, penalty and interest using the Information Reporting Program (IRP) data and other internally available information.

  2. An ASFR assessment can be identified on IDRS by a TC 290 assessment with Document Locator Number (DLN) blocking series (9th - 11th digits) of 320 - 399 or 540 - 549. (640-649 is obsolete as of 01/01/2008).

  3. A pending ASFR assessment can be identified on IDRS by TC 150 for $.00, with DLN tax class 2 and doc. Code 10 (3rd - 5th digits). The indicator "SFR" is present at the right of the TC 150 DLN.

  4. TC 599 cc 89 indicates an agreed assessment of tax. Any receipts that indicate previously filed returns (TC 599 cc 89) are treated as amended and worked by Accounts Management.

  5. TC 599 cc 88 indicates the assessment was not a return or agreed assessment of tax. Any receipts that indicate default assessments (TC 599 cc 88) are treated as ASFR Reconsiderations and are worked at ASFR Reconsideration sites.

  6. If the taxpayer is requesting reconsideration on an ASFR assessment, see IRM 4.13.7-1, ASFR - Reconsideration Returns - Centralized Processing Sites and forward the return to the appropriate site. The ASFR program is worked by Austin, Brookhaven and Fresno campuses.

  7. If the taxpayer requests a copy of the SFR return, refer to IRM 3.5.20.5, Photocopy and Miscellaneous Requests.

21.3.4.12.3.2  (07-28-2006)
Examinations Audit Reconsideration

  1. A taxpayer may request an audit reconsideration as a result of an examination.

  2. Some reasons for an audit reconsideration request on an examination include:

    1. The taxpayer did not appear for the audit.

    2. The taxpayer moved and did not receive the correspondence from the IRS.

    3. The taxpayer has new documentation to present.

  3. A taxpayer might request an audit reconsideration if:

    1. Taxpayer disagrees with an assessment from an audit of their return and has additional information to be considered.

    2. Taxpayer disagrees with an assessment created under the authority of IRC 6020(b).

    3. Taxpayer has been denied tax credits such as EITC claimed, during prior examination.

  4. For general procedures regarding audit reconsideration requests, see:

    1. IRM 4.13, Audit Reconsideration

    2. IRM 21.5.10.4.3, Audit Reconsiderations

    3. IRM 21.5.10.4.4, Copies of Audit Report

21.3.4.12.4  (04-09-2008)
Spousal Relief

  1. Spousal relief is granted in certain situations when a taxpayer can prove he/she is not liable for amounts due in joint filing situations. The Service will consider these requests for relief under Injured Spouse Relief and Innocent Spouse Relief rules.

    Caution:

    Do not confuse Injured Spouse cases with Innocent Spouse cases since they have unique criteria that must be met to consider relief in either case.

21.3.4.12.4.1  (10-01-2013)
Injured Spouse Relief

  1. The spouse whose portion of a joint income tax overpayment was or will be offset to a tax or non-tax debt for which he or she is not liable is known as the "injured spouse" .

  2. The injured spouse must have made payments such as Federal income tax withheld from wages or estimated tax payments, unless EITC or another refundable credit was claimed on the joint return.

  3. The injured spouse must file Form 8379, Injured Spouse Claim and Allocation, to request his or her portion of the joint refund.

  4. The injured spouse attaches Form 8379 to the back of the original Form 1040, Form 1040A or Form 1040EZ at the time it is filed and writes "Injured Spouse" in the upper left corner of the 1040 series.

  5. If the original return has already been filed, the injured spouse mails Form 8379 to the Center that processed the original return.

  6. For Injured Spouse inquiries, see IRM 21.4.6.5.3, Injured Spouse Inquiries.

21.3.4.12.4.2  (10-01-2013)
Innocent Spouse

  1. Both taxpayers filing a joint return are generally jointly and individually responsible for all tax due in that tax year.

  2. In some cases, a spouse will be relieved of the tax, interest and penalties on a joint return. Three types of relief are available:

    1. Innocent spouse relief

    2. Separation of liability relief

    3. Equitable relief

      Note:

      See Publication 971 for an explanation of these three types of relief.

  3. For Additional information refer to IRM 25.15.2, General Procedures/Employees With Taxpayer Contact.

  4. Taxpayers may request the relief by filing Form 8857, Request for Innocent Spouse Relief.

  5. When a Form 8857 is received TAC employee must date stamp the receipt of the form and forward to the Innocent Spouse Unit located at the Cincinnati Campus. The mailing address is listed below and this address can be given to the taxpayer;

    Internal Revenue Service
    Stop 840F
    PO Box 120053
    Covington, KY 41012

  6. The Innocent Spouse Unit has responsibility for input of transaction codes to stop potential collection actions. When the determination is made by the Innocent Spouse Unit, a TC 971 Action Code (AC) 065 is input to IDRS to stop all potential collection action. A TC 972 AC 065 is input when a final determination is made.

  7. For more information, see IRM 3.12.3.3.7, Innocent Spouse Relief Request, Form 8857.

21.3.4.12.5  (04-17-2013)
Balance Due Accounts

  1. Assisting taxpayers in resolving their balance due account(s) is the responsibility of all TAC employees while speaking with a taxpayer. Field Assistance employees must refer to IRM 5.19.1, Balance Due for complete procedures.

    • Compliance authority for FA employees is defined in IRM 5.19.1.5, Methods of Payment.

    • See IRM 5.19.1.5.5.4 for IMF and BMF compliance cases outside of this authority.

      Exception:

      Taxpayers with combat zone account issues have specific criteria for balance due accounts. See IRM 5.19.10.6.5.8, Combat Zone Installment Agreement and 60 or 120 Day Agreement Requests.

    • Also see IRM 5.19.1.7, Currently Not Collectible and Offer In Compromise.

  2. ACS cases (status 22) are in scope and worked in Field Assistance. If a trained employee is not available to offer assistance, refer the case in accordance with FA in-house referral procedures (see IRM 21.3.4.3.6.3.3, In-Scope Account Referrals).

  3. If any modules are in status 22 and you do not have access to the ACS system (i.e., system down, password problems, or 5081 to gain access to the ACS system has not been approved yet), contact the http://serp.enterprise.irs.gov/databases/who-where.dr/acsspt-lias.dr/acs-support.htm for actions to take. This will allow timely input of the documentation to the taxpayer’s account in the ACS system.

    If... Then...
    TP account is assigned to a Revenue Officer or other unit (Insolvency, etc.) Refer TP to the assigned employee/office for assistance. See the Who/Where tab on http://serp.enterprise.irs.gov/
    TP account is not assigned on IDRS Determine if the TP qualifies for a 60 or 120 day full pay agreement per IRM 5.19.1.5.5.23, Voluntary Lump Sum Payment.
    TP qualifies for a 60 or 120 day full pay agreement Determine if the TP can full pay within 60 or 120 days, whichever is applicable.
    TP cannot full pay within 60 or 120 days, and the issues are within the services that we provide Determine if the taxpayer meets Installment Agreement criteria. See IRM 5.19.1.5.5.4, Account Statuses Affecting Installment Agreements.
    TP cannot full pay within 60 days or 120 days and the issues are not within the services that we provide Determine the BOD and direct the taxpayer to contact the appropriate ACS toll-free number below.
    W&I: 1-800-829-7650
    SB/SE: 1-800-829-3903

    Note:

    These procedures apply to Full Pay within 60 or 120 day agreements that may be granted on assessed or pre-assessed balances for all individual (IMF) and business (BMF) taxpayers regardless of dollar amount.

  4. Field Assistance will continue to assist taxpayers that owe less than $100,000, aggregate assessed balance, regardless of BOD, provided that the cases are within the scope of services that we provide.

    Exception:

    Cases with incarceration issues will be referred to ACS. Determine the BOD and direct the taxpayer to contact the appropriate ACS toll-free number from above.

  5. If IDRS is accessed during Return Preparation (e.g., determining if an ESP amount was paid to the taxpayer) and outstanding returns and/or balances are indicated as due, complete the following actions:

    1. Advise the taxpayer of the outstanding returns and/or balances due.

    2. Determine if the taxpayer can file and/or full pay today; if yes, secure the outstanding returns and/or balances due and document AMS history accordingly. If the taxpayer needs to file a prior year return, and a time slot is not available, schedule an appointment for the prior year returns.

    3. If not, input current levy sources and advise the taxpayer to secure a ticket to meet with an ITAS to facilitate resolution; document AMS history accordingly.

21.3.4.12.5.1  (10-27-2011)
Warning of Enforcement Action

  1. Warning of Enforcement Action (WOEA) is a required part of resolving certain delinquent accounts such as an account in ST 22 (ACS). The TAC employee must alert the taxpayer of possible enforcement action that may take place for failure to comply. For additional information, including when the WOEA is required, see IRM 5.19.1.8, Warning of Enforcement Action and Enforced Collection.

  2. The use of "warned of enforcement action" or "WOEA" by itself is not sufficient when documenting AMS. Document AMS with the specific warning communicated to the taxpayer.

21.3.4.12.5.2  (10-11-2012)
Notice of Federal Tax Lien (NFTL)

  1. The employee working the balance due case is responsible for safeguarding the government’s interest. Field Assistance employees working balance due cases must exercise judgment in deciding whether or not a Notice of Federal Tax Lien (NFTL) should be filed.

    • IRM 5.19.4.2, What Are Levies and Liens? provides the definition of a Notice of Federal Tax Lien (NFTL) and the effect that it has on property owned by the taxpayer.

    • IRM 5.12.2.1, Purpose and Effect of Filing a Notice of Federal Tax Lien (NFTL) discusses the purpose and effect of filing a Notice of Federal Tax Lien (NFTL).

    • IRM 5.12.2.2, Creation and Duration discusses the creation and duration of the NFTL, as well as IRC 6321.

21.3.4.12.5.2.1  (10-11-2012)
Criteria for Filing a Notice of Federal Tax Lien (NFTL)

  1. The prospect of lien filing is an effective tool to encourage prompt payment. See IRM 5.19.4.5.2, Lien Filing Determinations for procedures on when to file a lien.

  2. Installment agreement - See IRM 5.19.4.5.2 for procedures.

  3. Currently Not Collectible - See IRM 5.19.4.5.2 for procedures.

  4. Continuous Wage Levies (CTLV) - See IRM 5.19.4.5.2 for procedures.

  5. The Service is required to make reasonable efforts to contact the taxpayer before filing a NFTL. See IRM 5.19.4.5.1, Before Filing Liens.

  6. If the taxpayer has not received written warning of lien filing on each module to be included on the lien, follow the procedures in IRM 5.19.4.6.1, How to File a Lien, to ensure the taxpayer receives appropriate notification.

  7. If full payment is not received during initial contact, explain to the taxpayer that a lien might be filed. Explain the possible effects of the NFTL filing on normal business operations and/or their credit rating.

  8. Document additional warnings of lien filing made during taxpayer contacts on AMS.

  9. File a NFTL if collection is at risk - See IRM 5.19.4.5.2(7), Lien Filing Determinations for procedures.

  10. If a lien has been filed - See IRM 5.19.4.5.2(8), Lien Filing Determinations for procedures.

  11. If managerial approval is required - See IRM 5.19.4.5.2(9), Lien Filing Determinations for procedures.

  12. A decision not to file a NFTL - See IRM 5.19.4.5.2(10), Lien Filing Determinations for procedures.

  13. You may consider lien filing on any balance due - See IRM 5.19.4.5.3, When Not to File a Lien for exceptions.

  14. If you are filing a NFTL and have personal contact with the taxpayer - See IRM 5.19.4.6, Procedures for Filing Liens for procedures.

  15. Taxpayers may appeal the proposed filing of a lien under the Collection Appeals Program (CAP).

    Reminder:

    Liens are released when the liability is satisfied (e.g., payment or tax abatement), becomes unenforceable due to lapse of time (beyond Collection Statute Expiration Date – CSED), or the Service (under IRC 6325(a)(2)) accepts a bond furnished by the taxpayer to ensure payment of liability.

  16. For further guidance, see:

    • IRM 21.3.4.12.5.5, Other Lien Issues (Subordination, Discharge, Withdrawal, Nonattachment)

    • IRM 5.19.4.6.4 for Lien Withdrawals

    • IRM 5.19.4.6.5 for Lien Releases

    • IRM 1.2.44.4(Delegation Order 5.3) (Rev. 1); IRM 1.2.44.5(Delegation Order 5.4) (Rev. 3).

    • IRM 5.19.4.5.2 for Lien Filing Determinations

    • IRM 5.19.4.5.3 for When Not to File a Lien

    • IRM 5.19.4, Enforcement Action

    • http://irm.web.irs.gov/link.asp?link=5.19.4-2Lien Enforcement Action Process Flowchart

21.3.4.12.5.2.2  (10-01-2013)
Filing Liens in Field Assistance

  1. Notice Status Modules

    1. When it is determined that a Notice of Federal Tax Lien will be filed on a taxpayer account containing only notice status modules, the ITAS will advise the taxpayer of this action. The ITAS will complete Form 12636, Request for Filing or Refiling Notice of Federal Tax Lien to submit as an attachment by secure email to the appropriate Centralized Lien Unit team below according to where the property is located.

      Note:

      Always check the http://serp.enterprise.irs.gov/databases/who-where.dr/als.dr/case-processing-lien-units.htm website if you experience any problems using this chart since the website contains the most current information.

      Corresponding State of Lien Filing Secure email Address
      FL, GA, IA, IN, PR, SC, VA and International *SBSE CCP Liens Team 101
      DC, DE, KY, MD, MI, NC, NJ, PA, RI, WV *SBSE CCP Liens Team 102
      AL, CT, MA, ME, NH, NY, OH, VT *SBSE CCP Liens Team 103
      AK, AR, AZ, HI, IL, KS, LA, MN, MO, MS, ND, NE, NM, NV, OK, SD, TN, TX, UT, WA *SBSE CCP Liens Team 201
      CA, CO, ID, MT, OR, WI, WY *SBSE CCP Liens Team 203
      To assist with resolving problem *SBSE CCP FORT@irs.gov

      Example:

      If your taxpayer resides in Georgia, you will address your secure email to *SBSE CCP Liens Team 101.

      For questions regarding ALS passwords or system problems, send an email to: *SBSE CCP FORT@irs.gov

    2. The "Subject" line of your email:
      W&I FIELD ASSISTANCE REQUEST FOR LIEN INPUT AND FILING

    3. In the body of your email, put the following information:

      • Completed Form 12636 is attached.

      • Name,

      • TSIGN,

      • Address, and

      • Phone Number of your FA Area CDP Coordinator (The lien cannot be filed without this information. See http://win.web.irs.gov/field/fadocs/jobaids/Area_CDP_Coordinators_for_FA.pdf, Area CDP Coordinators for Field Assistance.

      Note:

      If the taxpayer owns property in a different State than his/her State of residence, file the lien in all States in which real property is owned. Send Form 12636 via secure email to the correct CCP Lien Team for each of the respective locations of property. If the taxpayer resides outside of the United States, file the Notice of Federal Tax Lien in each location in which real property is owned, plus in the US District Court for the District of Columbia.

      When a CDP request is received by the FA Area CDP Coordinators, they will complete the following actions:
      • Process the CDP request using the procedures in IRM 5.19.8.4.7, Processing CDP and Equivalent Hearing Requests.

      • Input the CDP request into the CDP Tracking System (CDPTS)

        Note:

        Ensure you have access to the CDPTS

      The CDPTS is IDRS based with a web interface for input and will track the initial receipt of the hearing request in IRS through resolution of the case in Appeals. Accurate and timely updates are imperative. Input to the tracking system must be done within 24 hours of receipt when possible.
      To gain access into the system, create a new Help Desk (OS GetServices) "Ticket for My Technology"
      1. Choose "Get New/Upgrade Software"

      2. Enter the following information:

        1. Product – All Software Desktop/Laptop (IRS APPS)

        2. Description – CDP Web Terminal ID for use with CDPTS Web (You must specify a Computing Center TCC for Tennessee Computing Center access or MCC for Enterprise Computing Center - Martinsburg access. Both Centers’ jurisdiction is as follows:

          • Enterprise Computing Center - Martinsburg:
            Andover
            Brookhaven
            Philadelphia
            Austin
            Ogden

          • Tennessee Computing Center:
            Cincinnati
            Memphis
            Atlanta
            Kansas City
            Fresno

        3. Product Name and Version – CDP Web Terminal ID

        4. Number of Copies Requested – 1

        5. Business Justification – Specify why you need access to CDPTS Web (e.g. To input FA Area__(state Area #) CDP requests into system as the Area CDP Coordinator)

        6. Fill in remaining information for Requestor and Approver and submit the ticket to the Help Desk

    • Ensure you have the following command codes in your IDRS profile:
      CDPTA - CDPTE - CDPTRT

    • To begin access thehttp://cdp.web.irs.gov

      Select MCC for Enterprise Computing Center - Martinsburg access.
      Select TCC for Tennessee Computing Center access.
      Users should logon with their IDRS user-id, name and password.
      The entry code is optional. The entry code must be blank for the first sign on for the day.
      An IDRS session should not be running when accessing the CDPTS.

    • After input into the CDPTS forward the CDP letter and any correspondence related to the CDP request to Appeals via E4442 on AMS.

    • Document in the AMS history "CDP Paperwork forwarded to Appeals" . See Case Routing by State/Zip at http://appeals.web.irs.gov/APS/caserouting.htm

    • Destroy returned CDP notices that were refused or unclaimed. If a CDP notice is returned as undeliverable, you may send an information copy to the taxpayer at the current address.

      Note:

      If the notice was not sent to the last known address, the improperly addressed notice is considered to be invalid. A new notice should be issued to the taxpayer at the last known address. The taxpayer may request a CDP hearing based on the new notice.

  2. ACS Status 22 Modules

    1. When it is determined that a Notice of Federal Tax Lien will be filed on a taxpayer account containing only ACS Status 22 modules, the ITAS will advise the taxpayer of this action.

    2. Tell the taxpayer that a letter will be sent by certified mail after the lien is filed with more information about the lien and taxpayer rights. The letter has a Toll-Free ACS site telephone number. It identifies the Operations Manager as the contact but the response address is to the Campus.

    3. If you have access to ACS, follow the procedures in IRM 5.19.4.6.1, How to file a Lien.

    4. If you do not have access to ACS, complete a Form e-4442 referral requesting the lien filing and send it to the http://serp.enterprise.irs.gov/databases/who-where.dr/acsspt-lias.dr/acs-support.htm

    Note:

    If the account contains both notice status and Status 22 modules and you have access to ACS, follow the procedures in IRM 5.19.4.6.1, How to File a Lien. If you do not have access to AMS (ACS web), follow IRM 21.3.4.3.6.3.3, In-Scope Account Referrals

    .

21.3.4.12.5.2.3  (12-06-2012)
Assisting Taxpayers With Requests for Notice of Federal Tax Lien (NFTL) Withdrawals

  1. Assist taxpayers with the preparation of requests to withdraw a NFTL in the situations outlined below.

  2. NFTL withdrawal after paying a tax bill - If a taxpayer has paid their tax bill in full and a lien has been released, the taxpayer may ask about a withdrawal. If the taxpayer would like to submit a request to withdraw the NFTL, assist the taxpayer with the preparation of Form 12277, Application for Withdrawal of Notice of Federal Tax Lien.

  3. NFTL withdrawal after entering into a Direct Debit installment agreement (DDIA) - If a qualifying taxpayer meets the eligibility requirements (see below), they may be able to have a NFTL withdrawn after entering into a DDIA. If the taxpayer would like to submit a request to withdraw the NFTL, assist the taxpayer with the preparation of Form 12277, Application for Withdrawal of Notice of Federal Tax Lien.

  4. Fax the request to the appropriate Collection Advisory Group based on where the taxpayer resides. Fax numbers are located in Pub 4235, Collection Advisory Group Addresses. Provide the taxpayer with:

    • The original (or a copy) of the completed Form 12277

    • Pub 4235 with the appropriate Advisory Group notated

    • Advise the taxpayer to expect an interim contact from the Advisory Group within thirty (30) calendar days from date submitted (faxed to Advisory Unit).

  5. Any taxpayer can request a withdrawal; however to qualify for the withdrawal under the DDIA provision, the taxpayer must be:

    • Individuals (Form 1040 tax)

    • Businesses with income tax liability only

    • Out of business entities with any type of tax debt

  6. Other eligibility requirements for the DDIA provision are:

    • The current amount owing must be $25,000 or less (If more than $25,000 is owed, the balance may be paid down to $25,000 prior to requesting the lien withdrawal to be eligible)

    • The Direct Debit Installment Agreement must full pay the amount owing within 60 months or before the Collection Statute expires, whichever is earlier

    • Must be in full compliance with other filing and payment requirements

    • Must have made at least three consecutive direct debit payments

    • Cannot have previously received a NFTL withdrawal for the same taxes (unless the withdrawal was for an improper filing of the NFTL)

    • Cannot have defaulted on a current (or any previous) DDIA

      Note:

      Eligible taxpayers may not be aware of the lien withdrawal provisions.

  7. See IRM 5.19.4.6.4.2, Withdrawal of Notice of Federal Tax Lien after Release, and IRM 5.19.4.6.4.1, Withdrawal of NFTL for Direct Debit Installment Agreements for more information. Refer all other requests on NFTL withdrawal issues to the applicable Collection Advisory Office listed in Publication 4235.

21.3.4.12.5.3  (10-01-2009)
Lien Payoff Requests

  1. When asked to provide lien payoff information, the Field Assistance employee will determine who is asking for the information and follow procedures in IRM 21.3.4.12.5.3.1, Lien Payoff Requests from Taxpayers or IRM 21.3.4.12.5.3.2, Lien Payoff Request from Third Parties. Also, determine whether or not restricted interest and penalty applies and follow procedures:

    • If there is no restricted penalty or interest, the Field Assistance employee will prepare and process the appropriate payoff letter per IRM 21.3.4.12.5.3.3, Lien Payoff Request – No Restricted Interest/Penalty Accounts.

    • If the account reflects restricted penalty or interest, the Lien Unit will prepare and process the appropriate payoff letter per IRM 21.3.4.12.5.3.4, Lien Payoff Request – Restricted Interest/Penalty Accounts.

21.3.4.12.5.3.1  (10-01-2007)
Lien Payoff Requests from Taxpayers

  1. When asked to provide lien payoff information, the Field Assistance employee will verify the taxpayer’s identity and determine if the request is for accounts with restricted interest.

  2. If account does not have restricted penalty or interest, use Letter 3640–A, Lien Pay-off Letter to provide the taxpayer a lien pay-off amount(s). This letter is available by accessing Forms/Pubs/Docs then selecting Forms/Pubs/Products Repository, selecting letter from the drop down box, and typing in 3640 with the suffix A.

    Note:

    When inputting information to Letter 3640–A, use TAB key to navigate the document, do not use commas in any dollar amount, and input totals in the TOTAL column. The system will generate the GRAND TOTAL.

21.3.4.12.5.3.2  (10-01-2008)
Lien Payoff Request from Third Parties

  1. Escrow agents, title companies, and lending institutions must give the Field Assistance employee a Form 8821, Tax Information Authorization signed by the taxpayer. These forms must show the address of the real property subject to the lien. See IRM 5.12.2.16.1, Disclosure to Escrow and Title Companies. Use Letter 3641, Third Party Lien Payoff Letter (Escrow or Financial Institution).

  2. Any person, other than the taxpayer or their designee, desiring information regarding the amount of the outstanding obligation in order to decide whether to acquire the property covered by the Notice of Federal Tax Lien (NFTL) must submit a written request stating the reasons the information is desired and properly identify the NFTL. A prospective purchaser should attach a copy of the sales contract and a lender should attach a loan application as required by IRM 5.12.2.16, Requests for Disclosure of Outstanding Lien Amount.

21.3.4.12.5.3.3  (10-01-2011)
Lien Payoff Request – No Restricted Interest/Penalty Accounts

  1. Field Assistance employees will determine lien payoff information on accounts in which no restricted interest or restricted penalty has been assessed and will issue the necessary letter. See IRM 5.19.12.7.3, Wage and Investment. To determine if restricted interest or penalty is present on the account the employee will access Command Code INTST on IDRS. If restricted interest and/or penalty are present, IDRS Command Code INTST will give a message saying there is a "hold" on interest or penalty.

    Exception:

    Command Code INTST will show a penalty hold on MFT 55 cases. Because MFT 55 is a penalty, failure to pay penalty does not accrue. The INTST computation is correct and should be used to compute correct lien payoffs. A Trust Fund Penalty may be assessed against one or more people who fail to pay over to the IRS withheld taxes. If only one person was assessed and that person is paying the account in full, you may obtain an INTST on IDRS, secure full payment and release the lien. However, if the assessment was made against two or more people, the following procedures apply:

    • If the person making full payment of the trust fund penalty is requesting a lien release, obtain an INTST, secure full payment and release the lien.

    • If a person requests a lien release based on payments or refund offsets/credits made by someone else, you must refer that matter to the appropriate SB/SE Collection Advisory Group.

    • Collection Advisory Group information is located in Pub 4235, Collection Advisory Group Addresses.

  2. If there is no restricted interest and/or restricted penalty, the Field Assistance employee will:

    1. Access the account on AMS leaving a history of action(s) taken.

    2. Verify the taxpayer’s address and update the account.

    3. Ask the taxpayer the expected date of payment, calculate the payoff amount by referencing the taxpayer’s account on IDRS and locate any TC 582 lien indicators. If available, check ALS for any outstanding liens.

    4. Create the applicable lien payoff Letter 3640-A. Field Assistance employees Grade 9 and above can sign the payoff letter on behalf of the Field Assistance Group Manager if the manager is not available.

    5. Give the original payoff letter to the taxpayer and advise the taxpayer to include a copy of the payoff letter with their payment.

    6. Advise taxpayer they have the option of returning to the TAC with payment or they can mail it to the address below:
      Internal Revenue Service
      P. O. Box 145595
      Stop 8420-G
      Cincinnati, OH 45250-5595

      Note:

      There is no street address.

    7. Give the taxpayer the toll-free telephone number for the Centralized Lien Unit 1-800-913-6050.

21.3.4.12.5.3.4  (05-21-2010)
Lien Payoff Request – Restricted Interest/Penalty Accounts

  1. When a taxpayer comes into the office and makes a request regarding a lien payoff on modules with restricted interest or accounts on which the computation on IDRS shows penalty hold, the following procedures should be followed:

    1. Access the account on AMS leaving a history of action taken.

    2. Verify the taxpayer’s current mailing address and update accordingly.

    3. Send a secure email to the appropriate Centralized Lien Unit team for your location. The contact information for the Centralized Lien Unit teams can be found at: http://serp.enterprise.irs.gov/databases/who-where.dr/als.dr/case-processing-lien-units.htm

      Include the following information in the secure email:

      • "Subject" Line of email should indicate:
        "Lien Payoff Request - Restricted Interest/Penalty Account/Field Assistance-Walk-in Taxpayer"

      • Body of email should include:

      • Taxpayer name and address

      • Taxpayer telephone number and the best time to call if additional information is needed

      • Taxpayer identifying number(s) (TIN)

      • Tax Year(s) to be included in payoff

      • Date of expected payment

      • Name of Field Assistance employee requesting payoff

      • Post of duty

      • Which combat zone

      • Entry date into combat zone

      • Exit date from combat zone

    Note:

    If freeze code "C" is on account, "Combat Zone" information is required for Restricted Interest calculation. Please provide current deployment information. See IRM 5.19.10.6, Combat Zone Accounts.

  2. Advise the taxpayer that the payoff will be mailed to their address of record in 14 calendar days and provide the toll-free number of the Centralized Lien Unit 1-800-913-6050. The Centralized Lien Unit will:

    1. Complete the computation or determine if the case needs to be referred to centralized case processing examination unit.

    2. Acknowledge by email receipt of the request from Field Assistance and ask for clarification if needed.

    3. Prepare the payoff letter within 14 calendar days and mail the taxpayer two copies of the letter.

      Note:

      Exigent/Hardship Circumstances: There may be times when the taxpayer has an extreme emergency such that waiting the 14 calendar days on restricted interest cases is not acceptable. These cases should be brought to the attention of the Field Assistance Manager. If warranted, the Field Assistance Manager will contact the Lien Unit Manager to determine the time frame for completion of the restricted interest computation and notify the taxpayer of the time frame.

21.3.4.12.5.4  (10-01-2009)
Lien Release Request

  1. Field Assistance will process requests for a release of a Notice of Federal Tax Lien (NFTL) due to full payment.

  2. Routine Releases and Payment Made by Check or Non-certified Funds

    • Verify taxpayer’s address and update the account.

    • Process the payment using Designated Payment Code (DPC) 07 if the payment will full pay the lien.

    • Advise the taxpayer that they will receive a copy of the lien release in the mail within 30 days.

    • Provide the toll-free number of the Centralized Lien Unit, 1-800-913-6050 for additional questions.

    • Access the account on AMS and leave a history of action taken.

    Note:

    The DPC code will generate the normal processing of the lien release. The taxpayer’s copy of the lien release will be printed and mailed to the address of record from the National Print Site. Field Assistance does not need to generate any documents to the Lien Unit for a routine request.

  3. Immediate Release Requested - When a taxpayer makes a request for an immediate lien release and has satisfied all modules on which the lien has been filed (TC 582) by cash, postal money order, certified check, cashiers check, official bank check or guaranteed draft drawn on any federally chartered or state licensed financial institution, the following procedures will be followed:

    1. Verify the taxpayer’s current mailing address and update accordingly.

    2. Prepare posting document using DPC 07 (using AMS will automatically leave a history entry on AMS). Add a narrative to the history item on AMS that certified funds were received.

    3. Send a secure email to *SBSE CCP Liens Walkin

      Note:

      Subject line of email should indicate:
      "Lien Release- Field Assistance-Walk-in Taxpayer - One (1) Hour Response"

    4. Body of email should include:

      -Taxpayer name and address
      -How period(s) were satisfied (certified funds, cash, satisfied prior on IDRS and account is in status 12, adjustment)
      -Taxpayer identifying number(s) (TIN)
      -Taxpayer periods satisfied
      -Date modules were satisfied
      -Name of Field Assistance employee requesting lien release, post of duty and name of manager.

    5. Access taxpayer account via AMS and leave a history of action(s) taken.

  4. Care must be given to ensure the proper amount of money is collected to satisfy the tax liability on modules which have a lien filed prior to requesting a lien release. Delegation Order 5-4, Formerly Delegation Order 196, gives the authority to sign a release of tax lien to an Individual Taxpayer Advisory Specialist (ITAS), GS -9 and above and to Field Assistance Group Managers, see IRM 1.2.44Servicewide Policies and Authorities, Delegation of Authorities for the Collecting Process. The Centralized Lien Unit will not verify the validity of our request for a lien release since the authority to release a lien is in Delegation Order 5-4. Therefore, Field Assistance must ensure the accuracy of all requests for an immediate release of a lien.

  5. A lien may be considered satisfied if the assessed balance of the period reflected on the lien is less than ≡ ≡ ≡ ≡ ≡ and the total balance due, with accruals, is less than ≡ ≡ ≡ ≡ . If more than one period is reflected on the lien, each period must meet this criteria in order for the lien to be considered satisfied. See IRM 5.19.12.7.3, Wage and Investment.

  6. The secure email request for the lien release must be made by an ITAS, GS-9 or above. If an ITAS grade 9 or above is not available, Group Managers must establish procedures in their office(s) to handle the immediate request for a lien release. This could be accomplished by the email to the lien unit coming from the Group Manager, the Group Referral Coordinator, etc.

    Note:

    In order to meet the one hour time frame, the request must be done by 3:30 p.m. local TAC time. Taxpayers who come in after 3:30 p.m. local TAC time should be advised to return the next business day. The email requesting the lien release can be generated after 3:30 p.m., but the release will not be forwarded until the next business day.

  7. The Centralized Lien Unit will:

    • Provide a response by secure email if they need additional information

    • Update ALS with a history of the requesting Field Assistance employee and post-of-duty

    • Satisfy the modules on ALS with the appropriate information from the email request

    • Print release

    • Secure required management signature

    • Scan the release

    • Send the scanned document to the Field Assistance employee requesting release via secured email within one (1) hour of receipt of email

  8. Upon receipt of the release, the Field Assistance employee will:

    • Date stamp the release

    • Give the release to the taxpayer

    • Advise the taxpayer to hand carry the release to the recording office

    • Advise the taxpayer they may be charged a fee to file the release

    • Provide the taxpayer with Notice 48, Release of Federal Tax Lien. Refer to IRM 5.12.6.5.1.6, Taxpayers May Receive Form 3982, Billing Support Voucher (BSV), for Release Recording Fees.

    • Give the taxpayer the toll-free number for the Centralized Lien Unit 1-800-913-6050

21.3.4.12.5.5  (12-06-2012)
Other Lien Issues (Subordination, Discharge, Withdrawal, Nonattachment)

  1. A taxpayer may need information regarding a Notice of Federal Tax Lien (NFTL) other than full-pay releases. TAC employees answer general questions and provide applicable publications pertaining to:

    1. Subordination - Taxpayer retains ownership of the property, but needs to borrow money and the lender will not loan funds without some security that they will be repaid. Generally, subordinations are granted when the IRS receives the borrowed funds, or under circumstances that will facilitate collection of the tax.

      Example:

      The loan is to hire workers to harvest a crop and then IRS will be paid from the sale of the crop.

      See IRM 5.12.3.13, Subordination of Lien for more information.

    2. Discharge - The taxpayer will no longer own the property and there will not be enough money to pay the taxes in full. In other words, they can’t get a "release" of the lien. See IRM 5.12.3.12, Discharge of Property for more information.

    3. Withdrawals – Individual taxpayers may request a NFTL withdrawal when a NFTL is issued improperly, after a lien has already been released, or if the balance due is less than $25,000 and the taxpayer has made a minimum of 3 consecutive DDIA payments.

      Note:

      Requests must be in writing or on Form 12277, Application for Withdrawal of Notice of Federal Tax Lien. For taxpayers that meet the criteria, FA employees will assist with completing and faxing Form 12277 to the appropriate Collection Advisory Group per IRM 21.3.4.12.5.2.3, Assisting Taxpayers With Requests for NFTL Withdrawals. All other requests for NFTL withdrawals will be referred to the appropriate Collection Advisory Group listed in Pub 4235

      , Collection Advisory Group Addresses. See IRM 5.12.3.27, Withdrawal of the Filed Notice of Federal Tax Lien (Overview) for additional information.

    4. Nonattachment - When a NFTL impacts an innocent third party.

      Example:

      A lien is filed against a father, but it is negatively impacting a son with the same name. The son may qualify for a certificate of nonattachment stating that he is not the same person for whom the lien has been filed against.

      See IRM 5.12.3.24, Certificate of Nonattachment for more information.

    Note:

    FA employees are not expected to answer technical questions on lien issues that they have not been trained on. Provide a copy or printout of Publication 4235, Collection Advisory Group Addresses and refer the taxpayer to the appropriate SB/SE Collection Advisory Group (formerly SB/SE Technical Services Advisory Office) based on where the lien is filed. The Advisory Groups Contact Listing can also be found on the SERP "Who/Where" tab under the Advisory Units Contact List.

  2. The following publications will provide the taxpayer with detailed information to assist them in resolving their issue:

    • Pub 487, How to Prepare an Application to Release Property Secured by Federal Tax Lien

    • Pub 594, The IRS Collection Process

    • Pub 783, Instructions on how to apply for a Certificate of Discharge of Property From Federal Tax Lien

    • Pub 784, How to Prepare an Application for a Certificate of Subordination of Federal Tax Lien

    • Pub 785, Purchase Money Mortgages and Subordination of the Federal Tax Lien

    • Pub 1024, How to Prepare an Application for a Certificate of Nonattachment of Federal Tax Lien

    • Pub 1450, Instructions on How to Request a Certificate of Release of Federal Tax Lien

    • Pub 4235, Collection Advisory Group Addresses (this publication also provides phone numbers if a taxpayer needs further guidance)

    If taxpayer is And Tell Publications
    Selling a property that has a federal tax lien Proceeds of sale are less than amount needed to pay the lien in full TP to apply for a certificate of discharge Pub 783
    Pub 594Pub 4235
    Selling a property that has a federal tax lien Proceeds of sale are equal to or more than amount needed to pay the lien in full TP must pay lien in full (in order for lien to be released) Pub 594
    Borrowing or refinancing on property that has a federal tax lien Borrowed funds are less than amount need to pay lien in full TP may apply for subordination Pub 784
    Pub 594Pub 4235
    Borrowing or refinancing on property that has a federal tax lien Borrowed funds are equal to or more than amount need to pay lien in full TP must pay lien in full (in order for lien to be released) Pub 594
    Buying a home, and has a federal tax lien Borrowed funds are equal to or less than the amount needed for the home mortgage and to pay the lien in full TP may apply for subordination.

    Note:

    If "purchase money mortgage" , subordination may not be required.

    Pub 784
    Pub 785
    Pub 594
    Pub 4235

    Note:

    In extreme cases, if the taxpayer requests to speak with Technical Services, the assistor will prepare and fax a referral to that office, or call the office and request the assistance of a Technical Services advisor. However, such instances should be rare.

21.3.4.12.5.6  (10-01-2009)
Private Debt Collection (PDC)

  1. On March 5, 2009, the Internal Revenue Service (IRS) announced that it would not be renewing contracts with two private debt collection agencies working with the IRS Private Debt Collection (PDC) program. The IRS determined that the work is best done by IRS employees who have more flexibility handling cases, which is particularly important with many taxpayers currently facing economic hardship.

  2. The two private collection agencies (PCAs) whose contracts were impacted by this decision are: The CBE Group, Inc. and Pioneer Credit Recovery, Inc. All taxpayer accounts that were assigned to these collection agencies were returned to the IRS for review and processing. The account return process began on March 19, 2009, and ended September 30, 2009.

  3. All cases that were previously assigned to the Private Debt Collection (PDC) program will have a TC 972 AC 054 on the module, indicating that they are no longer assigned to a PDC. Process these cases as you would any other balance due case.

21.3.4.12.5.7  (10-01-2013)
Installment Agreements

  1. Some common IRM 5.19.1 references for FA employees assisting taxpayers with Installment Agreements include:

    IRM 5.19.1.5.5 Installment Agreements
    IRM 5.19.1.5.5(9) Streamlined Installment Agreement
    IRM 5.19.1.5.5.13 Direct Debit Installment Agreement (DDIA)
    IRM 5.19.1.5.5.14.1 Form 2159 - Payroll Deduction Installment Agreement (PDIA)
    IRM 5.19.1.5.6 Partial Payment Installment Agreement (PPIA)
    IRM 5.19.1.5.5.5 Installment Agreement Payment Methods and User Fees Overview
    IRM 5.19.1-5 IDRS Input of Full Pay Agreements, 120 Days or Less, CC IAORG for AM/ACS/ACSS/CSCO/FA
    IRM 5.19.1-6 IDRS Input of Full Pay Agreements, 120 Days or Less, CC IAREV for AM/ACS/ACSS/CSCO/FA
    IRM 5.19.1-7 IDRS Input of Installment Agreements - CC IAORG
    IRM 5.19.1-8 IDRS Input of Installment Agreements - CC IAREV
    IRM 5.19.1-9 IDRS Input of Pre-assessed IAs and Full Pay Agreements
    IRM 5.19.1-10 Installment Agreement Locator Numbers
    IRM 5.19.1-11 Installment Agreement Originator Codes
    IRM 5.19.1-12 Installment Agreement User Fee Codes

  2. Installment agreements require an Agreement Locator Number (ALN) which is located in IRM 5.14.1-2, Installment Agreement Locator Numbers — (ALNs) and an Installment Agreement Originator Code which is located in IRM 5.19.1-11, Installment Agreement Originator Codes.

    The Installment Agreement Originator Codes for Field Assistance are:
    50 = Regular (non-streamlined) agreement
    51 = Streamlined agreement

  3. Field Assistance employees must ensure the timely input of Transaction Code (TC) 971 Action Code (AC) 043 when a taxpayer requests an installment agreement on a balance due account and the agreement cannot or should not be immediately input. TC 971 Action Codes are found in Document 6209. Refer to IRM 5.19.1.5.5.6, Pending Installment Agreement Criteria for more information on pending installment agreements.

  4. When a determination is made by a FA employee and the Group Manager that an installment agreement cannot or should not be accepted, statute requires that the taxpayer be allowed independent administrative review. ITAS should prepare Form 12233, Request for Installment Agreement – Independent Review Prior to Rejection on Account Management Services (AMS). This completed form should be sent to:

    Internal Revenue Service
    329 Oak Street
    Ste 103
    Gainesville, GA 30501
    ATTN: Independent Administrative Reviewer

    Note:

    Include the wage and/or earnings information, copy of the entire case history and any other pertinent information when forwarding the Form 12233 to the Independent Administrative Reviewer. Box E should be completed in its entirety or annotated as N/A when applicable.

21.3.4.12.5.7.1  (10-01-2013)
Direct Debit Installment Agreement — Form 433–D, Installment Agreement and Form 9465, Installment Agreement Request

  1. A Direct Debit Installment Agreement (DDIA) is an agreement in which the taxpayer authorizes the IRS to request electronic transfer of funds from their checking account or shared draft account to the IRS; such as payments are withdrawn on the same date each month.

    Exception:

    If the taxpayer requests to make Electronic Funds Transfer Payments (EFT) through the internet using online banking methods, it is considered a regular Installment Agreement and not a DDIA.

  2. Encourage taxpayers requesting an IA to establish a DDIA. See IRM 5.19.1.5.5.13(3) for advantages of the DDIA to the taxpayer. Taxpayers with a NFTL filed may also request a withdrawal of the NFTL when on a DDIA. See IRM 21.3.4.12.5.5, Other Lien Issues (Subordination, Discharge, Withdrawal, Nonattachment), for more information.

  3. To establish a DDIA, the taxpayer must submit a voided check or the financial institution’s routing and account number with their request.

  4. Direct Debit Installment Agreements can be requested in the following formats:

    1. Form 433-D, Installment Agreement. This may be either an original form or a fax.

    2. Form 9465, Installment Agreement Request. This may be an original form received attached to a tax return or received separately.

    3. Electronic signature via Form 9465, Installment Agreement Request, sent with ELF-filed tax returns.

    4. Photocopied Form 9465, Installment Agreement Request, with "9465W/AUR Assess" notated at the top of the page in red.

    5. Taxpayer correspondence.

    Note:

    DDIA requests must include all necessary information to establish a DDIA, including the taxpayer’s signature.

  5. Taxpayers may also go to the IRS website to enter anhttp://www.irs.gov/Individuals/Online-Payment-Agreement-Application

  6. Input of DDIA agreements is limited to Compliance Services Collection Operations (CSCO) employees and ACS Support. See IRM 5.19.1.5.5.13, Direct Debit Installment Agreement (DDIA) for guidance on appropriately routing DDIA requests.

  7. New requests - the TACs will complete the following actions:

    1. Secure a signed Form 433-D with a voided copy of the taxpayer’s check or the routing and account number with their request.

    2. Inform TP it can take as much as 6 to 8 weeks before drafts are automated so check account to ensure payment was drafted and if not send in payment by check.

    3. Inform TP he/she will receive a letter of confirmation once the DDIA is set up.

    4. TAC employee to Express Mail DDIA requests with Form 3210.

    5. Do not input to Status 60.

    6. Input TC 971 AC 043.

    7. Input CC STAUP for 9 cycles.

    8. Document AMS with the terms of the agreement as required in IRM 21.3.4.12.5, Balance due Accounts.

    9. TACs do not accept faxed Forms 433-A, 9465, or 9465-FS.

    10. This DDIA process does not begin until the balance due tax return has posted or the assessment has been made. As a result, the DDIA process takes longer on Pre-Assessed agreements. The taxpayer should be advised to send payments until the DDIA begins.

      Note:

      Pre-Assessed agreements cannot be processed for first-time filers. The initial return establishes the filer's entity. If a first-time filer requests a Pre-Assessed agreement, advise that we are unable to process the request. Ask them to contact us for a DDIA after their return has been processed and they receive their initial balance due notice.

  8. Revised DDIA – New Banking Information with existing DDIA:

    1. Secure new Form 433-D with the new signature and voided check.

    2. Inform taxpayer that he/she will receive a letter of confirmation from Compliance Services Collection Operations once the Direct Debit Installment Agreement has been converted to the new account.

    3. TAC employee will Express Mail request with Form 3210 to the Campus DDIA Liaison http://serp.enterprise.irs.gov/databases/who-where.dr/ddia_liaison.htm with jurisdiction of TP account. Notate on Form 433-D "REVISED DDIA" .

  9. Update/Reinstate DDIA - Prepare Form e-4442 and fax information to the appropriate Campus DDIA Liaison within 24 hours.

  10. For issues with current DDIAs, follow procedures in IRM 5.19.1.5.5.13.2, Taxpayer Problems With DDIA.

  11. Monthly reminder notices are not issued on DDIAs. Taxpayers not keeping up-to-date records often default on their Installment Agreement due to insufficient funds in their bank accounts. Advise the taxpayer to keep their records up to date to avoid a default of their Installment Agreement.

  12. If the taxpayer does not have the necessary information to establish a DDIA agreement, take the following actions:

    1. Establish the Installment Agreement, requiring the taxpayer to send in payments each month.

    2. Advise taxpayer that they will receive Letter 2273C, Installment Agreement Acceptance & Terms Explanation with instructions on how to request a DDIA.

    3. Request they complete Form 433-D, and return it with a voided check and the installment agreement fee, in order to establish a Direct Debit Installment Agreement.

    4. Provide the taxpayer with the address of the Campus DDIA liaison having jurisdiction of the taxpayer account.

      Note:

      When the regular agreement is converted to a DDIA, the taxpayer is sent a letter explaining the terms of the DDIA; the Agreement Locator Number (ALN) will be changed to "03XX" and turns on the DDIA indicator.

  13. For new DDIA agreements or those for which the taxpayer is changing banks, routing numbers or account information, banking law regulations require the taxpayer, or one of the taxpayers for a joint account, named on the bank account to authorize the direct debit process by signing the request. All functions can accept a signed request for a new or revised DDIA by fax.

21.3.4.12.5.7.2  (10-01-2013)
Payroll Deduction Installment Agreement, Form 2159

  1. If a taxpayer is a wage earner, offer a Payroll Deduction Agreement (PDIA) to satisfy the outstanding liability.

  2. If a taxpayer makes a request for a PDIA:

    If... And... Then...
    The taxpayer requests a PDIA It is a Streamlined IA $25K and under, Non-Streamlined IA, or PPIA
    1. Establish the Installment Agreement as a regular IA requiring the taxpayer to send in payments each month.

    2. Assist the taxpayer with completion of Form 2159, Payroll Deduction Agreement via AMS.

    3. Advise the taxpayer to present all parts (copies) of Form 2159 to their employer and make necessary arrangements to begin payroll deduction.

    4. Inform the taxpayer you have established the Installment Agreement as a regular agreement requiring they send in monthly payments until the Form 2159 is return signed by the employer.

    5. Advise the taxpayer of the Installment Agreement user fee. See IRM 5.19.1.5.5.5, Installment Agreement Payment Methods and User Fee (UF) Overview.

    6. Inform the taxpayer the agreed monthly payment amount on Form 2159 cannot be less than the current agreed payment amount.

    7. Advise the taxpayer to mail the signed Form 2159, Part 1, to the CSCO Operation campus having jurisdiction of the taxpayer account. See Collection Payments/Addresses/Issues for the Campus address under the "Who/Where" tab on SERP.

    Note:

    Advise the taxpayer that normal processing time is 4-6 weeks.

    The taxpayer requests a PDIA It is a Streamlined IA over $25K
    1. Do not input the IA

    2. Input TC 971 AC 043

    3. Assist the taxpayer with preparation of the Form 2159, Payroll Deduction Agreement

    4. Advise the taxpayer to present all parts (copies) of Form 2159 to their employer and make necessary arrangements to begin payroll deduction.

    5. Inform the taxpayer the agreed monthly payment amount on Form 2159 cannot be less than the current agreed payment amount.

    6. Advise the taxpayer to mail the signed Form 2159, Part 1, to the CSCO Operation campus having jurisdiction of the taxpayer account. See Collection Payments/Addresses/Issues for the Campus address under the "Who/Where" tab on SERP.

    7. See IRM 5.19.1.5.5.24, Streamlined Installment Agreements Over $25,000, or IRM 5.19.1.5.5.24.1, Reinstating Streamlined Installment Agreements Over $25,000.

    Note:

    Advise the taxpayer that normal processing time is 4-6 weeks.

    If the taxpayer returns to the office with a completed Form 2159 It is any kind of IA (Streamlined IA $25K and under, Streamlined IA over $25K, Non-Streamlined IA, or PPIA)
    1. See IRM 5.19.1.5.5.14.1, IRM Input of Payroll Deduction Agreement

    2. Mail the signed Form 2159, Part 1, to the CSCO Operation campus having jurisdiction of the taxpayer account. See Collection Payments/Addresses/Issues for the Campus address under the "Who/Where" tab on SERP.

    3. See IRM 5.19.1.5.5.24, Streamlined Installment Agreements Over $25,000, or IRM 5.19.1.5.5.24.1, Reinstating Streamlined Installment Agreements Over $25,000.

    Note:

    Advise the taxpayer that normal processing time is 4-6 weeks.

    Note:

    If the employer contacts IRS requesting our agency's Employer Identification Number (EIN) for payroll processing, provide the following EIN 72-0564834

  3. If the taxpayer's employer is a Federal Agency, see IRM 5.19.1.5.5.14.2, Form 2159, Payroll Deduction Agreement, Federal Employer Addresses.

  4. Ask the taxpayer to return Part 1 of the completed Form 2159, Payroll Deduction Agreement to IRS within 14 days of the date of the letter.

  5. If the monthly payment is less than the user fee, advise the taxpayer the first payment must be for the user fee amount, and include the completed Form 2159, Payroll Deduction Agreement. A return envelope is provided for this purpose.

  6. Letter 2571C, Letter To Employer: Discontinue/Adjust Payroll Deduction is automatically sent to the employer when the account goes to Status 12 telling them to discontinue payroll deductions. If requested, fax or mail a new letter to the employer or taxpayer.

21.3.4.12.5.8  (10-27-2011)
Levy Release: General Information for Field Assistance

  1. Field Assistance does not issue levies. They are normally issued by collection employees after the taxpayer has been given an opportunity to resolve their tax liability but failed to do so. Taxpayers will generally come into the TAC once they learn that a Notice of Levy has been issued and are requesting a release.

  2. A release is not required for a levy that was issued prior to reaching a resolution with the taxpayer unless it meets one of the criteria for required release located in IRM 5.19.4.4.10, Levy Release: General Information. Delegation Order 5-3 provides the authority to release a levy for Individual Taxpayer Advisory Specialists. Only the GS-09 ITAS and above will have the authority to issue the release. When a GS-09 and above are not available, follow the procedures in IRM 5.19.4.4.10, Levy Release: General Information when making a determination to release a levy.

21.3.4.12.6  (10-01-2011)
Correspondence Imaging System (CIS)

  1. FA employees will use CIS to work Correspondence Adjustment cases and to assist walk-in customers.

  2. The Correspondence Imaging System (CIS) is a document imaging and workflow system. All incoming paper correspondence, notice replies, Forms 1040X, internal transcripts, and internal Computer Paragraph (CP) notices are scanned and processed as digital images. CIS interacts with IDRS to control cases, input STAUPs, when needed, and distribute cases electronically to CSRs for resolution. The digital cases are assigned to CSRs who work the cases online using the workflow software. CIS interacts with IDRS to initiate various command codes and captures the request completed screens as a part of the digital case.

  3. Field Assistance employees will follow the guidelines in IRM 21.2.1.9, Correspondence Imaging System (CIS), IRM 21.5.2, Adjustment Guidelines, and IRM 21.5.1, General Adjustments when working contacts/cases having scanned images. CIS use is required for working ALL Correspondence Inventory Cases. CIS will be used to view taxpayer correspondence sent to the campus while assisting walk-in taxpayers.

  4. CIS is accessed through the AMS system.

    Note:

    Many of the account related IRMs reference CSR’s. A CSR includes, but is not limited to, the following named positions:

    • Contact Representative

    • Individual Taxpayer Advisory Specialist (ITAS)

    • Office Collection Representative (OCR)

    • Senior Taxpayer Advisory Specialist (STAS)

    • Tax Account Representative (TAR)

    • Tax Examiner (TE)

    • Tax Law Specialist (TLS)

    • Tax Specialist (TS)

    • Tax Technician (TT)

    • Taxpayer Service Representative (TSR)

    Note:

    All employees assigned to Accounts Management, Field Assistance and Compliance Services are considered CSRs. See IRM 21.1.1.6, Customer Service Representative (CSR) Duties for additional information on the duties of a Customer Service Representative (CSR).

    Note:

    See IRM 21.5.1, General Adjustments and IRM 21.5.2, Adjustment Guidelines for additional information and procedures on ADJ54 adjustments. See FA Insider Correspondence/Adjustment Inventory http://win.web.irs.gov/field/FA_Corres_Adj_Inventory_2.htm job aids.

21.3.4.12.7  (10-01-2013)
Tax Return and Tax Account Transcript Requests

  1. See IRM 21.2.3, Transcripts for complete guidance on Transcripts and TDS.

    Caution:

    Refer to IRM 21.2.3.5.8, Transcripts and Identity Theft for directions in cases of identity theft or suspected identity theft.

  2. Taxpayers should be provided with options available to obtain copies of their tax returns and transcripts. If the taxpayer requests a photocopy of his/her return, advise to file Form 4506, Request for Copy of Tax Return

    Note:

    Form 4506 is also used when the taxpayer is requesting a certified copy of their return. Date stamping a transcript for the taxpayer does not certify the transcript. See IRM 11.3.6.2, Requesting Certifications, and IRM 11.3.5.7.7, Certification for how taxpayers can request certification of documents.

  3. See IRM 21.2.3.2.1, Tax Return Transcript for procedures.

    Exception:

    For Invalid TINs not on TDS, use CC IRPTR on IDRS to provide invalid TIN income information.

  4. The following guidelines apply to requests for transcripts:

    • Transcripts will be provided to "individual taxpayers" without regard to the reason for the request. Hardship is no longer required for a TAC to provide this service to individuals. They can be for tax or non-tax purposes.

    • Individual taxpayer means the requestor is the taxpayer (IMF or BMF), not a third party (see exception below).

    • If a tax practitioner, Title Company, bank or other third party requests bulk return transcripts at a TAC, advise them to complete Form 4506-T, Request for Transcript of Tax Return using the general instructions provided on the form. They may provide the completed form to the TAC, mail the form in themselves or forward by fax.

    • TAC employees will follow IRM 21.2.3.4.1, Requesting Transcripts timeframes to determine if the taxpayer can wait 5-10 days for a transcript. If the taxpayers has an immediate need, and they meet the conditions of receiving a transcript, it may be provided immediately.

      Exception:

      If a person visits the TAC on behalf of a relative (parent, child, brother, sister, etc.) and has proper authorization, the TAC should provide the transcript as these are considered to be individual taxpayer requests.

    • If an office experiences higher volumes of transcript traffic than existing staffing can handle, with Area Director Approval, these taxpayers may be directed to alternative methods; however, hardship requests should be honored locally.

    • In order to ensure consistency of service, all employees must adhere to these guidelines. Third party requests (other than the exception noted above for relatives) must be referred to alternative sources.

  5. ITAS will promote the availability of alternative methods of obtaining transcripts.

    • Ensure the taxpayer has information necessary to select an alternative method of obtaining a transcript in the future by offering Pub 4201, Need Tax Return Information or Transcripts? to all taxpayers requesting a transcript in the TAC.

    • When providing the publication, identify the information by advising the taxpayer of the ability to obtain transcripts on-line, by phone, or by mail.

    • If the taxpayer already has a copy of Pub 4201, (i.e they picked it up from the forms rack or the IAR provided it) advise the taxpayer transcripts may be ordered on-line, by phone, or by mail as explained by the publication.

    Note:

    For circumstances when transcripts are not being offered (under an exception) or when there will be a long wait to see an ITAS, the IAR should also offer Pub 4201. The IAR should identify the purpose of the publication and offer the option of obtaining a transcript via one of the easy to use automated methods.

  6. See IRM 21.3.4.7.14, Payments with Form 4506, for instructions on sending Form 4506 received with a payment to the RAIVS Unit.

21.3.4.12.7.1  (10-01-2013)
Non-Receipt, Incorrect, or Loss of Form W-2, 1099, and 1098 Information Returns

  1. Two Integrated Data Retrieval System (IDRS) Correspondex letters will be used for responding to taxpayer inquiries regarding Non-Receipt, Incorrect or Loss of W-2, 1099 and 1098 Information Returns:

    • Letter 62C, Non-Receipt, Incorrect, or Loss of Form W-2 and Form 1099-R and

    • Letter 63C, Form W-2 and/or Form 1099-R Requested from Employer/Payer,

    These letters will be used in lieu of Form 4598 (obsolete) and the pre-stuffed packets previously prepared by the Campus Machine Service Units.

  2. Employees will use the IAT NoW2 Tool to generate the appropriate letter. If the IAT tool is unavailable then employees will use AMS and IDRS Correspondence system to generate the appropriate letters. See IRM 21.2.3.2.3, Wage and Income Transcript for prior year requests. (See IRM 21.3.6.4.7.1, Non-Receipt, Incorrect, or Loss of Form W–2, 1099, and 1098 — Information Returns for detailed guidance).

  3. If the taxpayer request assistance in obtaining a W-2 and/or 1099, refer to IRM 21.3.4.24, Resolving Form W-2/Form 1099 Inquiries.

21.3.4.12.8  (04-18-2012)
Use of FAX for Taxpayer Submissions

  1. Corporate officers or duly authorized agents may sign any of the following forms by facsimile (i.e., by rubber stamp, mechanical device, or computer software program):

    1. Form 94X series;

    2. Form 1042;

    3. Form 8027;

    4. Form CT-1;

    5. Any variant of such designated form (e.g., Form 940, Form 943).

  2. Officers or agents using a facsimile means of signature must retain a letter, signed by the officer or agent authorized to sign the return, declaring under penalties of perjury that the facsimile signature on the form is the signature adopted by the officer or agent and that the facsimile signature was affixed to the form by the officer or agent or at his or her direction. The letter must list each return by name and identifying number. The letter should not be sent to IRS unless specifically requested by the Service. The letter shall be maintained for at least 4 years after the due date of the tax that relates to the tax return, or the date the tax is paid, whichever is later. See Rev. Proc. 2005–39 for additional information.

  3. Acknowledgement of faxes (by a return fax) that are received in the course of tax administration activities will not normally be done. Exceptions can be made in unusual circumstances.

  4. The following specific documents/forms/letters will continue to be accepted by fax in routine operations:

    • EIN Requests (Form SS-4)

    • Power-of-Attorney (Form 2848)

    • Taxpayer Authorization (Form 8821)

    • 1120S Election (Form 2553)

    • Return/Transcript Request (Form 4506/Form 4506-T/Form 4506-T-EZ)

    • Request for Public Inspection or Copy of Exempt or Political Organization IRS Form (Form 4506–A)

    • Foreign Certification Requests

    • Appeals Conference Requests

    • Responses/documentation needed to resolve filing or post-filing questions or correspondence

  5. The following specific documents/forms/letters can be accepted by fax if contact has been made with the taxpayer by phone or in-person and the taxpayer history file is documented with the date of contact and notation is made that the taxpayer wishes to send the document/form/letter by fax.

    • Requests for Innocent Spouse Relief (Form 8857)

    • Taxpayer Statement About a Refund (Form 3911)

    • Injured Spouse Claim (Form 8379)

    • Installment Agreements (Form 433–D)

    • Offers in Compromise (Form 656)

    • Collections Information Statement - Wage Earner (Form 433–A)

    • Collection Information Statement - Business (Form 433-B)

    • Early Referral Requests

    • Fast Track Mediation Requests

    • Request for Collection Due Process Hearing (Form 12153)

    • Letter to designate a payment

    • Letter to request non-filing of lien

    • Letter to request lien release

    • Letter to request lien withdrawal

    • Letter to request non-assertion of penalty

    • Letter to provide reasonable cause statement

    • Adjusted Employer's Quarterly Federal Tax Return or Claim for Refund (Form 941-X)

    • Election by a Small Business Corporation (Form 2553)

  6. Employee Plan and Exempt organization determination letter applications will not be accepted via fax.

  7. Determination Letter Requests related to income tax, gift tax, estate tax, generation-skipping transfer tax, employment tax and excise tax matters will not be accepted via fax.

21.3.4.12.9  (10-01-2013)
Returned Refund Checks

  1. Returned refund checks must be stamped or written "non-negotiable" on the front of the check and have the word "void" stamped or written on the back of the check.

  2. Form 3913, Acknowledgement of Returned Refund Check must be completed as a posting document. Parts 1 and 2 are given to the taxpayer and parts 3 and 4 are submitted to the appropriate Submission Processing Campus for processing. See IRM 21.4.3.4.5, Resolving Returned Refunds (Unexpired Checks).

  3. Complete Form 3210, Document Transmittal.

  4. Send the check, Form 3210, and Form 3913, to the Refund Inquiry Unit of the appropriate Submission Processing Campus for processing. See http://serp.enterprise.irs.gov/databases/who-where.dr/refund_inquiry/refund_inquiry.htm for Refund Inquiry Unit Addresses.

  5. If the returned refund check is due to possible refund fraud or ID Theft, see IRM 21.4.3.4.4, Returned Checks Procedures on how to handle these contacts.

  6. The reason for the returned refund check and actions to be taken must be explained on parts 3 and 4 of Form 3913. See IRM 21.4.3.4.5.1, Check for Different Amount if the refund is being returned and the taxpayer is requesting the refund for a different amount.

  7. If a taxpayer requests re-issuance of the refund check in the name of another party, they must provide sufficient proof for the request. See IRM 21.4.3.4.5.2, Issuing Checks in Another Name.

  8. If a taxpayer filed a joint return and requests re-issuance of the refund check in one name, see IRM 21.4.3.4.5.2.1, Joint Filers Request Refund Check in One Name for required documentation.

  9. If a return is not located after researching the account, follow IRM 21.4.1.3.1.1, Return Not Found for required actions to take.

21.3.4.12.10  (06-17-2013)
CP 2000

  1. A CP 2000, Issued to Taxpayer to Request Verification or Unreported Income, Payments, or Credits, is issued to notify the taxpayer of a proposed change to tax liability because of income that is not identifiable or apparently not fully reported on the return and/or credits and deductions that appear overstated.

  2. When a CP 2000 is issued, the AUR (Automated Underreporter) function puts a control on the module. IDRS research shows:

    • A TC 922

    • An underreporter process code. See IRM 4.19.3-5, AUR Process Codes.

  3. Underreporter Process Codes are also found in Chapter 8, Section 19 of Document 6209, IRS Processing Codes and Information. You can determine the Status of an Underreporter case and its location by the last process code.

  4. Explain the reason for notice, Section 2, "Reason for the Change" , of the CP 2000 This section provides explanations to help the taxpayer understand the proposed changes.

  5. Ask the taxpayer to compare their records with income and withholding listed on the CP 2000. You can often resolve the discrepancy based on the taxpayers response.

  6. If the taxpayer still does not understand, use the appropriate ITLA.

    Note:

    If the taxpayer did not bring the notice, access the account, verify disclosure, and click on the "AUR data present" line in the Alerts sections of AMS.

  7. For more information, see IRM 21.3.1.4.57, CP 2000 Issued to Taxpayer to Request Verification for Unreported Income, Payments, or Credits. The CP 2000 job aid is located at: http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/21.dr/21.3.dr/cp-2000.htm

    Caution:

    If the taxpayer indicates possible identity theft, refer to IRM 21.3.4.30.1, Tax Return Related Identity Theft Issues.

  8. See IRM 21.1.7-1, Campus Address for the correct address to forward taxpayer responses.

21.3.4.13  (03-28-2013)
Adjustments

  1. General adjustments are changes made to either IMF or BMF accounts. Adjustments may be required because of:

    • Processing errors on a return

    • Missing schedules

    • Claims

    • Amended returns

  2. When making adjustments TAC employees should refer to:

    • IRM 21.6.7, Individual Tax Returns, Adjusting Individual Tax Accounts for IMF adjustment procedures.

    • IRM 21.7.1.4, BMF/NMF Adjustment Procedures.

  3. When processing adjustment requests, TAC employees must:

    1. Use IDRS to complete all adjustments.

    2. Obtain all documents, returns, and taxpayer-supplied information necessary to make adjustments.

    3. Research IRS Publications, IRS Code and other IRMs as appropriate.

    4. Obtain technical assistance if issue is beyond training level.

  4. Do not refer the case unless the IRM specifically instructs you to do so. See IRM 21.6.2.4.1.3 for Merges/Resequences and IRM 21.6.2.4.2.1 for Mixed Entity referrals.

    Note:

    For ITIN Merge/Resequence issues, see IRM 21.3.4.19.9, Form e-4442, Inquiry Referral and IRM 3.21.263.6.1.33, Merges Involving ITIN.

21.3.4.13.1  (10-01-2009)
Filing Status and Exemption Adjustments

  1. TAC offices will assist taxpayers with changes to filing status and exemptions, (usually after a tax return has been filed). Evaluate each situation and make a determination to adjust taxpayer's filing status and/or exemptions. (See Publication 501, Exemptions, Standard Deduction and Filing Information). Refer taxpayers to the Taxpayer Advocate Service (when the contact meets TAS criteria and you can’t resolve the taxpayer’s issue the same day). See IRM 21.3.4.20, Referring Cases to the Taxpayer Advocate Service (TAS).

  2. If a taxpayer is responding to a math error notice for an invalid ITIN (Individual Taxpayer Identification Number) or is inquiring about the status of an ITIN application, refer to IRM 21.3.4.20.8 for instructions on researching the ITIN database.

  3. Refer to IRM 21.6.1, Individual Tax Returns, Filing Status and Exemption Adjustments for assistance in making determinations to properly adjust filing status and/or exemptions.

21.3.4.13.2  (10-01-2010)
General Math Error Procedures Overview

  1. In math or clerical error cases, the Service may assess and send a notice of assessment of additional tax without using deficiency procedures.

  2. TAC employees will assist taxpayers when they have received a Math Error Notice. See IRM 21.5.4.1, General Math Error Procedures Overview for guidelines on adjusting math error cases.

  3. Advise the taxpayer there are no appeal rights regarding the math error assessment, nor can the taxpayer petition Tax Court without first requesting abatement and receiving a notice of deficiency.

  4. Advise the taxpayer that IRC 6213 allows only 60 days from the date of the notice (the 23C date) to request abatement of the additional tax.

  5. Complete Form e-911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), and refer the taxpayer to the Taxpayer Advocate Service (TAS) when appropriate. See IRM 13.1.7.1, Taxpayer Advocate Service (TAS) or IRM 21.1.3.18, Taxpayer Advocate Service (TAS) Guidelines for more information.

  6. Math error adjustments are in-scope for Field Assistance. However, Form 1040X, Amended U.S. Individual Income Tax Return, is processed at the Submission Processing Campus. Adjusting an item not shown on the original return requires a signed amended return, Form 1040X.
    See:

    • IRM 21.5.2.4.2.1, Case Files/Actions online with Oral Statement

    • IRM 21.5.2.4.2, Adjustments With Oral Statement

    • IRM 21.5.2.4.3, Adjustments Requiring an Amended Return or Taxpayer Documentation

    • Technical Communication Document (TCD) http://techcomm.web.irs.gov/tcd/tcd0010/tcd0010.htm Amended Return (1040X) Pre-filing Reminders

    Example:

    1 - The taxpayer or IRS incorrectly transcribed the social security number for a dependent. The taxpayer is providing you with the correct information. Because this information was part of the original return and it is not changing the tax to less than it was on the return, the adjustment can be input by oral statement.

    Example:

    2 - The facts are the same as example one. In addition the taxpayer now realizes that they are entitled to an additional credit, that they must add another W-2, or that may must adjust an item on the original return that was not part of the math error. This adjustment requires Form 1040X which FA will submit it to the appropriate Submission Processing Campus.

    Example:

    3 - The taxpayer listed the item but did not attach the schedule. This is considered a math error and the adjustment can be input.

21.3.4.13.3  (10-01-2008)
Math Errors Regarding Exemptions On the Original Return

  1. A taxpayer may come into the TAC requesting assistance with a math error notice concerning exemptions claimed on the original return.

  2. Verify the validity of the name(s) and TIN(s) submitted by the taxpayer. Use Command Code INOLE(S) to verify the name and date of birth.

  3. For information regarding the dependent with the missing/invalid Taxpayer Identification Number (TIN), use RTVUE. On RTVUE, the dependent field is followed by an indicator showing which dependent(s) was included in the math error condition;

    • 2 = "Missing TIN"

    • 9 = "Invalid TIN"

  4. If the taxpayer responds with substantiation to prove that the math error is incorrect, follow the procedures in IRM 21.5.4.4.4, Math Error Substantiated Protest Processing. Oral statement adjustments are limited to the amount shown on the original return.

  5. If taxpayer responds to a math error notice within 60 days by refusing to obtain/provide the correct information and requests the account adjustment be made (after a full explanation of the legislative provisions are given), follow unsubstantiated math error procedures in IRM 21.5.4.4.5, Math Error Unsubstantiated Protest Processing.

    Note:

    For additional instructions see IRM 21.6.1.5.5, Exemption Claim Procedures.

21.3.4.13.4  (02-13-2009)
Unpostables Overview

  1. Unpostable transactions are those transactions that cannot be posted to the Master File. A transaction that fails to post to an account at the Enterprise Computing Center, Martinsburg (ECC-MTB) is returned to the originator of the transaction for corrective action.

  2. There are two types of unpostables:

    1. Unpostable returns

    2. Unpostable transaction codes

  3. Unpostables are handled in one of the following ways:

    1. The Generalized Unpostable Framework (GUF) system closes cases automatically.

    2. One GUF input action closes multiple cases (Unpostable function only).

    3. Unpostable function closes the cases manually.

    4. The item is returned for correction to the function/employee who created it.

  4. TAC employees’ responsibilities when making an adjustment include:

    1. Preventing unpostables when transferring payments and making changes to the taxpayer's account, see IRM 21.5.5.4.1, Preventing Unpostables.

    2. Resolving unpostables created by their own adjustments, see IRM 21.5.5.4.2, Resolving Unpostables, and IRM 21.5.5.4.2.2, Unpostables Created by Your Own Adjustment.

    3. Entering history information on Integrated Data Retrieval System (IDRS) to assist the Unpostable function. See IRM 21.5.5.3.2.1, Unpostable IDRS Command Codes, for information on Command Code UPCAS, UPDIS, UPRES, UPTIN.

      Reminder:

      All IDRS access must be completed via AMS.

  5. TAC employees’ responsibilities when handling taxpayer inquiries involving unpostables is a four step process:

    1. Identifying the unpostable

    2. Researching the unpostable

    3. Resolving the unpostable (if possible)

    4. Responding to the taxpayer

  6. For additional information see IRM 21.5.5.4.2, Resolving Unpostables.

21.3.4.13.5  (10-01-2005)
Freeze Codes

  1. Master File processing uses alpha codes to identify specific conditions that are generated systemically, during the processing operation, or manually, through input of a transaction code. These alpha codes are commonly referred to as "freeze" codes. Freeze codes prevent the issuance of refunds, credit offsets, or the assessment of an accrued interest and/or penalty.

  2. There are three types of freeze condition codes:

    • Those identifying conditions existing in the module/account that freeze refunds and prevent offsets in or out of the module, but do not stop balance due notices.

    • Those that freeze IDRS balance due notices, refunds, offsets, and TDA issuances.

    • Those indicating that certain conditions exist on the module. Activity on the account is not frozen.

  3. TAC employees should not take action on any freeze condition without complete IDRS research. See IRM 21.5.6.4, Freeze Code Procedures for guidance on how to resolve freeze conditions.

  4. See Document 6209 for a complete list of freeze codes.

21.3.4.13.6  (03-22-2010)
Payment Tracers

  1. TAC employees are responsible for researching and resolving payment tracer inquiries.

  2. Payments not applied to the correct tax module may cause erroneous notices or refunds.

  3. If the payment is located:

    1. Initiate a credit transfer request to apply the payment to the correct account. Initiate a credit transfer request via Integrated Automation Technologies (IAT). All employees must sign-on to AMS, IDRS, and then IAT. Follow the procedures in IRM 21.3.4.13.7, Credit Transfers.

    2. Advise the taxpayer that the issue has been resolved by sending the appropriate letter to the taxpayer.

  4. Use IAT in resolving payment tracer research.

  5. If the payment is not located:

    1. Initiate a payment tracer request via IAT. All employees must sign-on to AMS, IDRS, and then IAT. Follow the procedures in IRM 21.5.7.4.4.1, Form 4446, Payment Tracer Research Record.

    2. Refer to the appropriate Center Payment Tracer function for further research on Form 4446. Do not prepare Form e-4442.

  6. See IRM 21.5.7, Account Resolution, Payment Tracers and http://serp.enterprise.irs.gov/databases/irm.dr/current/21.dr/21.5.dr/21.5.7.dr/21.5.7-1.htmHardcore Payment Tracer Addresses.

  7. See IRM 21.5.7.3.5, Remittance Left Attached to the Return for referral procedures when remittance was left attached to the return.

21.3.4.13.7  (03-22-2010)
Credit Transfers

  1. All credit transfer request will be processed via Integrated Automation Technologies (IAT). IAT is mandatory for processing all credit transfer contacts. A credit transfer moves a payment or credit from one account to another, or reverses credits previously applied.

  2. Credit transfer adjustments may not be input if another employee or organization has an open control base. Contact the person or organization with the open control base. DO NOT reassign or change the control base until this contact is made.

  3. TAC employees can transfer a credit if at least one of the tax modules is on IDRS. If not, bring account to IDRS using CC MFREQ or create a dummy account using CC ACTON.

  4. Credit transfers may be made based on an oral statement or correspondence received from the taxpayer. If the authorization is through oral statement, the taxpayer must confirm the payment amount or the IRS endorsement information on the cancelled check.

  5. If a source document is required, see IRM 21.3.5.4, Referrals for instructions on preparing Form e-4442 or the taxpayer's correspondence must be used. Otherwise, the Remarks Field on the credit transfer input must include a brief explanation for the transfer.

    If... And... Then...
    Payment posted to the same TIN or related account Credit is available Source document is not required.
    Payment posted to the same TIN or related account Transfer results in debit balance Source document is required.
    Payment posted to non-related account Credit is available Source Document is required.
    Payment posted to non-related account Transfer results in debit balance Source Document is required.

    Caution: Follow procedures in IRM 21.4.5, Erroneous Refunds if a refund was issued in error.

  6. Refer to IRM 21.5.8.3.1, Determining Source Document Requirement for Credit Transfers, for examples of related accounts.

  7. For information on credit transfers involving the Individual Retirement Account File (IRAF) refer to IRM 21.6.5.4.11.8, Retirement Account File (IRAF) Credit Transfers, and IRM 21.6.7, Individual Tax Returns, Adjusting Individual Tax Accounts.

  8. For credit transfers to Non-Master File (NMF) accounts, prepare Form e-4442, and forward it to your Submission Processing Campus.

21.3.4.14  (10-01-2010)
Applying for an Employer Identification Number (EIN)

  1. Every business entity that is required to have one must be assigned an EIN. See IRM 21.7.13.2.3, Methods by Which Taxpayers Can Apply for an EIN.

  2. If a taxpayer needs an EIN, provide Form SS-4, Application for Employer Identification Number and advise the taxpayer of the following methods to obtain the EIN:

    • Toll-free EIN – Taxpayers call to request an EIN and an EIN is assigned within 15 minutes. EIN toll-free telephone number is 1–800–829–4933.

    • Fax-TIN – Taxpayers fax their application and an EIN is assigned and faxed back within 4 working days. See IRM 21.7.13.7.1, State Mapping for Assigning EINs for the fax numbers.

    • Mail SS-4s – Taxpayers mail their application and an EIN is assigned within 4 weeks from the received date of the application. Mail to campus of record.

    • Modernized Internet EIN - Replaced the online Form SS-4 application. Taxpayers can apply for an EIN online by answering questions via the online application. The EIN confirmation notice can be downloaded, saved and printed after successful completion. For more information see IRM 21.7.13.3.4.1, Modernized Internet EIN - Mod IEIN.

  3. IRS assigns a nine digit EIN in the format NN-NNNNNNN. This EIN remains that entity's number even if the entity changes locations or opens additional locations.

21.3.4.14.1  (10-01-2013)
EIN Verification

  1. In October 2002, Department of Treasury issued USA Patriot Act Guidance, Section 352, which requires financial institutions to establish an anti-money laundering program. This program requires financial institutions to verify an account holder's identity before the establishment of an account. Often "business entity taxpayers" will come to the TAC requesting some support documentation to provide to financial institution to verify their EIN.

  2. The following procedures should be followed by TAC employees when assisting taxpayers with EIN verification as it relates to the Patriot Act guidelines:

    1. TAC employee will request sufficient information and follow disclosure procedures to determine that the requestor is the taxpayer on the account or is authorized to receive the information under IRC 6103(e). Follow the Account Management Services (AMS) Guidelines for disclosure.

    2. The IDRS and entity screen INOLE will show the EIN, and cross reference to the valid business owner's Social Security Number (SSN), if the entity is a sole proprietor or partnership. The SSN cross- reference may not always be available on the entity information. If the SSN cross reference is not present, TAC employees should ensure the information is provided to the appropriate person by verifying the identification.

    3. If the taxpayer is requesting the EIN verification for a corporation, TAC employees will request a copy of a valid state corporate filing (or other appropriate documentation that supports the request) to ensure the requester is listed as a corporate officer or is authorized to receive the information. For partnership entities, TAC employees should verify the Schedule K-1 (Form 1065) was filed for the requester as part of their 1040 return. This requires securing the SSN of the requester to complete the verification.

    4. If the taxpayer or representative does not have the proper identification and disclosure cannot be verified, do not provide the EIN verification. Instead inform them that EIN verification can only be provided after their identity is verified. The taxpayer should be advised to return with the information needed for the research.

      Note:

      If the taxpayer does not wish to return, advise them we will mail the EIN verification using Letter 147C to the address of record.

    5. Once the taxpayer or his representative has passed disclosure the following Command Codes can be used for research of entity information: INOLES, ENMOD, NAMES, and NAMEE.

    6. If the taxpayer does not know the EIN but has passed the disclosure checks from cc NAMEE and INOLE(S) research and you are able to retrieve the information, provide the verification print.

    7. TAC employees should print the entity information using Command Code INOLE(S) or ENMOD (page 1) and stamp the print with the official IRS received stamp (IRS, W&I, Field Assistance, city/state, date and "Received" ). ITAS can use this as a temporary verification. ITAS should order Letter 147C, EIN Previously Assigned to issue an official EIN verification letter, if requested by the taxpayer.

    8. If the taxpayer has no assigned EIN, the TAC employee should assist the taxpayer in completing the Form SS-4, Application for Employer Identification Number and advise the taxpayer that the letter issuing the EIN can be used as verification.

    9. If the taxpayer has more than one EIN, prepare Form e-4442 to Entity Control. See IRM 3.13.2.13, Multiple EIN.

21.3.4.15  (10-01-2011)
Employment Taxes

  1. Generally, an employer must withhold federal income taxes from an employee's wages. Taxes under the Federal Insurance Contributions Act (FICA) are imposed on both the employer and the employee. In addition to being exclusively liable for its own portion of the FICA tax, the employer is obligated to collect the employee's FICA tax. FICA taxes are composed of the old-age, survivors, and disability insurance taxes, also known as social security taxes, and the hospital insurance tax, also known as Medicare taxes. A federal unemployment tax under the Federal Unemployment Tax Act (FUTA) is imposed on wages paid to employees. The FUTA tax is imposed solely on the employer. In addition, an employer must withhold federal income taxes from certain nonpayroll payments. Collectively, these taxes are referred to as "employment taxes" . Taxpayers must file employment tax returns to report these taxes. These include:

    • Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return

    • Form 941, Employer’s QUARTERLY Federal Tax Return

    • Form 943, Employer’s Annual Tax Return for Agricultural Employees

    • Form 944, Employer’s ANNUAL Federal Tax Return

    • Form 945, Annual Return of Withheld Federal Income Tax

    • Schedule H, Household Employment Taxes (attachment to Form 1040, Form 1040NR, Form 1040-SS, or Form 1041)

  2. TAC employees’ responsibilities regarding employment tax returns are as follows:

    1. Review the returns for accuracy and completeness.

    2. Educate the taxpayers on filing requirements, deposit rules, and return due dates.

    3. Secure payments, if applicable, (see IRM 21.3.4.7, Receipt of Payments, or IRM 5.7, Trust Fund Compliance).

    4. Mail returns to the appropriate Center.

21.3.4.15.1  (10-01-2013)
Form 940, Federal Unemployment Tax Act (FUTA)

  1. Every employer who, during the current or preceding calendar year, paid wages of $1,500 or more in any calendar quarter, or had one or more employees for some part of a day in any 20 or more different weeks, must file Form 940. The FUTA tax rate is calculated at 6.0 percent (.060) on the first $7,000 of wages paid to each employee during the calendar year.

  2. Form 940 is an annual return due by January 31, of the next year. However, if you deposited all of the FUTA tax when due, you have 10 additional calendar days to file.

  3. Agricultural employers are liable for FUTA tax if:

    1. Cash wages of $20,000 or more were paid to agricultural workers in any calendar quarter in the current or preceding year, or

    2. Ten or more agricultural workers were employed during some part of the day during any 20 different weeks in the current or preceding calendar year.

  4. Household employers must pay FUTA taxes ONLY if they paid cash wages of $1,000 or more in any calendar quarter in the current or preceding calendar year for household work. Generally, individuals, estates, and trusts that owe FUTA tax for domestic service in a private home, must file Schedule H (Form 1040). However, if an employer has other employees in addition to household employees, the employer can choose to include the FUTA taxes for their household employees on Form 940 instead of filing Schedule H (Form 1040). If the employer chooses to include household employees on Form 940, the employer must also report social security, Medicare, and withheld federal income taxes for household employees on Form 941, Form 944, or Form 943. See IRM 4.19.5.4.3, Schedule H, Household Employment Taxes Under Section 3510, and Publication 926, Household Employer's Tax Guide.

  5. Although Form 940 covers a calendar year, employers must deposit FUTA tax before they file Form 940. If an employer's FUTA tax is more than $500 for the calendar year, they must deposit at least one quarterly payment. Employers must determine when to deposit their tax based on the amount of their quarterly tax liability. If the FUTA tax is $500 or less in a quarter, carry it over to the next quarter. Employers can continue to carry over their tax liability until the cumulative tax is more than $500. At that point, employers must deposit their tax for the quarter. FUTA tax must be deposited by the last day of the month after the end of the quarter. If the tax for the next quarter is $500 or less, employers are not required to deposit their tax again until the cumulative amount is more than $500.

    Note:

    Deposit requirements can be found in Publication 15 (Circular E),Publication 51(Circular A).

  6. Employers may deposit their FUTA tax electronically by using EFTPS. Currently IRS can process Form 940 electronically. Two program options are available for businesses.

    • Form 940 e-file program

    • Form 940 online filing program (for additional information, see IRM 21.7.3.4.14, FUTA Electronic Filing)

21.3.4.15.2  (04-02-2013)
Form 941, Employer’s QUARTERLY Federal Tax Return

  1. Form 941, Employer’s QUARTERLY Federal Tax Return is used by employers to report income tax withheld from wages, including tips, supplemental unemployment compensation benefits, third party payments of sick pay, and both the employee and employer shares of social security and Medicare taxes. Publication 15 (Circular E) Employer’s Tax Guide contains complete information on filing employment tax forms and should be given to the taxpayer.

  2. An employer with a Form 944 filing requirement may opt out of filing Form 944 and file Form 941 instead, under certain circumstances. See IRM 21.3.4.15.4, Form 944, Employer’s ANNUAL Federal Tax Return. Beginning with tax year 2010, employers that would otherwise be required to file Form 944 can notify the service if they want to file quarterly Form 941 instead of the annual Form 944. See Rev. Proc. 2009-45. Previously, the Form 944 program was mandatory and taxpayers could only opt out for very limited reasons. For tax years beginning January 1, 2010, Rev. Proc. 2009-51 expands the opt out eligibility by allowing employers to opt out of the Form 944 program for any reason. See IRM 21.7.2.4, Employment Tax Returns Procedures.

  3. Use the following table to determine when the Form 941 is due. If any date shown below falls on a Saturday, Sunday, or federal holiday use the next business day as the due date for the return:

    Quarter Covered Quarter Ending Due Date
    January, February, March March 31 April 30
    April, May, June June 30 July 31
    July, August, September September 30 October 31
    October, November, December December 31 January 31

    Note:

    The return due date for Form 941 is extended 10 days if timely deposits in full payment of the amount of tax reported on the return are made.

  4. Some employers have to deposit Social Security, Medicare, and Federal Income Taxes. Refer to the deposit requirements in IRM 21.7.2.3.4, Deposits. Also reference Publication 15 (Circular E), Employer’s Tax Guide for additional payment information.

  5. Seasonal employers are relieved from filing tax returns for the quarters in which they have no tax liability. However, they must file at least one return each year and check the seasonal employer box on Form 941 to establish or maintain this status.

    Note:

    See IRM 21.7.2.4.7, Form 941, Employer’s QUARTERLY Federal Tax Return for additional information regarding Form 941.

  6. A new Additional Medicare Tax (AdMT) is effective for periods beginning after 12/31/2012. For more information on the new Additional Medicare Tax, see IRM 21.7.2.3.3, FICA Taxes (including Additional Medicare Tax).

  7. The IRS uses two different sets of deposit rules to determine when businesses must deposit their social security, Medicare, and withheld federal income taxes. These schedules tell you when a deposit is due after you have a payday. Employers may be monthly or semiweekly schedule depositors. Employers must deposit federal taxes withheld, and both the employer and employee social security and Medicare taxes, plus or minus any prior period adjustments, to their tax liability (minus any advance EIC payments). They must deposit by using the EFTPS. Some employers may make a payment with Form 941 instead of depositing, without incurring a penalty, if the following applies:

    • For tax periods beginning 01-01-2010, taxpayers may pay with the return if the total tax liability for either the current or prior quarter is less than $2,500 (unless the taxpayer has a $100,000 next-day obligation in the current quarter).

    • They are a monthly schedule depositor and make a payment in accordance with the Accuracy of Deposits Rule.

  8. Deposit Penalties - Penalties may apply if employers, due to willful neglect, do not make required payments on time, if they make deposits for less than the required amount or if they do not use EFTPS when required. Deposits paid directly to the IRS or paid with an employer's tax return are subject to a 10 percent penalty.

  9. Corrections to errors discovered on a previously filed Form 941 after December 31, 2008 will be made on Form 941-X, Adjusted Employer's Quarterly Federal Tax Return or Claim for Refund.

  10. Currently, IRS can process Form 941 electronically. Several program options are available for businesses.

    • 941 Online Filing Program

    • 941 XML Program (Employment Tax e-file System)

    • 944 On Line Filing Program

    • 944 XML Program (Employment Tax e-file System)

    Note:

    See IRM 21.7.2.3.5, Electronic Processing of Employment Tax Returns, and IRM 3.42.4, IRS e-file for Business Tax Returns for additional information.

21.3.4.15.3  (10-01-2011)
Form 943, Employer’s Annual Tax Return for Agricultural Employees

  1. Form 943 is filed on a calendar year basis to report income tax withheld and employer and employee FICA (social security and Medicare) taxes on farm workers. The return is due on or before January 31 of the year following the end of the calendar year.

    Note:

    If any date for filing a return, furnishing a form or depositing taxes falls on a Saturday, Sunday or legal holiday, the due date is the next business day. A stateside legal holiday delays a filing due date only if the IRS office where you are required to file is located in that state. However, a statewide legal holiday does not delay the due date of federal tax deposits. For any due date, filers will meet the filing requirement if the envelope containing the return or form is properly addressed, contains sufficient postage, and is postmarked by the U.S. Postal Service on or before the due date, or sent by an IRS-designated private delivery service on or before the due date. (Pub 51, (Circular A), Agricultural Employer's Tax Guide)

    .

  2. All cash wages paid to farm workers are subject to FICA and income tax withholding during the year if either of the two tests below are met:

    1. Cash and non-cash wages paid during the year to all farm workers totals $2,500 or more; or

    2. Annual cash wages of $150 or more are paid to an employee for farm work (This test is applied separately to each farm worker.)

  3. Employers whose tax liability is less than $2,500 for the year, can pay the tax due with their return if the return is filed on time. If their liability is $2,500 or more for the year, the employer must deposit their tax liabilities throughout the year in accordance with their deposit schedule using EFTPS. See section 7 of Publication 51 (Circular A), Agricultural Employer’s Tax Guide for information and rules concerning federal tax deposits and to determine the employer's status as a monthly or semiweekly schedule depositor.

    Note:

    See IRM 21.7.2.4.8, Form 943, Employer’s Annual Federal Tax Return for Agricultural Employees, Form 943 instructions and Pub 51 (Circular A) Agricultural Employer’s Tax Guide for additional information.

  4. Corrections to errors discovered on a previously filed Form 943 after December 31, 2008 must be made using Form 943-X, Adjusted Employer's Annual Federal Tax Return for Agricultural Employees or Claim for Refund.

21.3.4.15.4  (10-01-2013)
Form 944, Employer’s ANNUAL Federal Tax Return

  1. Form 944 is designed so the smallest employers (those whose annual liability for social security, Medicare, and withheld federal income taxes is $1,000 or less) will file and pay these taxes only once a year instead of every quarter. Form 944 is an annual return due by January 31 of the following year.

  2. Beginning with the tax year 2006, certain taxpayers were notified that they were to begin filing Form 944. Treasury Regulation Sections 31.6011(a)-1T(a)(5) and 31.6302-1T(c)(5) and (6) and Rev. Proc. 2009-3 IRB 323 provided new guidance relating to filing of Form 944.

  3. Employers must not file Form 944 unless they receive notification that they are eligible to do so. Employers who previously received notification of their qualification to file Form 944 must continue to file Form 944 unless the IRS notifies the employer that they no longer qualify to file Form 944 or the employer opts out per the instructions.

    Note:

    For additional information see IRM 21.7.13.7.6.1, 941 BNCHG Filing Requirement Input, IRM 21.5.2.4.2, Adjustments With Oral Statement, and Form 944 instructions.

  4. If an employer's total employment tax liability is less than $2,500 during the calendar year, then the taxpayer may pay with the return. If the taxpayer's total employment tax liability is $2,500 or more, the taxpayer must deposit the employee and employer FICA taxes and federal income tax withheld. Generally, the deposit rules that apply to Form 941 also apply to Form 944.

  5. The following employers cannot file Form 944:

    • Employers who are not notified by mail (exceptions may apply)

    • Household Employers

    • Agricultural Employers

  6. For additional information:

    Note:

    Payment options - see Instructions for Form 944.

    Note:

    Deposit requirements - see Publication 15 (Circular E), Employer's Tax Guide and IRM 20.1.4, Failure to Deposit Penalty.

  7. Corrections to errors discovered on a previously filed Form 944 after December 31, 2008 will be made on Form 944–X, Adjusted Employer's Annual Federal Tax Return or Claim for Refund.

21.3.4.15.5  (10-01-2010)
Form 945, Annual Return of Withheld Federal Income Tax

  1. Non-payroll income tax withholding is reported on Form 945. Non-payroll items include backup withholding and withholding for pensions, annuities, IRAs, military retirement, Indian gaming, gambling winnings, and voluntary withholdings on certain government payments.

  2. Form 945 is a calendar year return and is due on or before January 31 of the year following the end of the calendar year.

  3. Separate deposits are required for payroll (Form 941, Form 943, and Form 944) and non-payroll (Form 945) withholding.

  4. Use Publication 15-A, Employer's Supplemental Tax Guide and Instructions for Form 945 for resolving questions.

  5. An employer is required to file Form 945 only for a calendar year in which the employer withheld non-payroll tax.

    Note:

    See IRM 21.7.2.4.10, Form 945, Annual Return of Withheld Federal Income Tax, for additional information for Form 945.

21.3.4.15.6  (10-01-2013)
Schedule H, Household Employment Taxes

  1. Household employees include housekeepers, maids, babysitters, health aides, private nurses, gardeners, and others who work in or around your private residence as your employees. Repairmen, plumbers, contractors, and other business people who work for you as independent contractors, are not your employees. Household workers are your employees if you can control not only the work they do but how they do it. Reference the Publication 926, Household Employer's Tax Guide for additional information.

    • You generally must withhold Social Security and Medicare taxes from all cash wages you pay to a household employee that is more than the amount specified by law in a tax year ($1,800 for 2012 and 2013).

  2. Do not withhold or pay these taxes from wages you pay to:

    • your spouse,

    • your child who is under age 21,

    • your parent, unless an exception is met (see Pub 926 for additional information); or

    • an employee who is under age 18 at any time during the year unless performing household work is the employee's principal occupation. If the employee is a student, providing household work is not considered to be his or her principal occupation.

  3. Domestic service employment taxes are reported on Schedule H which is an attachment to Form 1040. The tax is paid with the taxpayer’s estimated tax payments on Form 1040-ES or through increased withholding on other income. If you are not required to file a Form 1040 you must still file Schedule H to report household employment taxes. Put the Schedule H in an envelope with a check or money order. However, a sole proprietor who must file Form 940 (PDF), Employer's ANNUAL Federal Unemployment (FUTA) Tax Return and Form 941 (PDF), Employer's QUARTERLY Federal Tax Return or Form 944, Employer's ANNUAL Federal Tax Return for business employees, or Form 943 (PDF), Employer's ANNUAL Tax Return for Agricultural Employees for farm employees, may include household employee tax information on these forms.

  4. TAC employees will assist taxpayers who are household employers in completing the Schedule H to report wages paid to domestic employees.

    Note:

    See IRM 21.6.4.4.8, Schedule H, Household Employment Taxes for additional information.


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