25.3.7  Reconciling Non-Insolvency LAMS Reports

Manual Transmittal

December 16, 2011

Purpose

(1) This transmits a Table of Contents and text for new IRM 25.3.7, Reconciling Non-Insolvency LAMS Reports.

Material Changes

(1) The section provides guidance and procedures for reconciling the Non-Insolvency LAMS Reports.

(2) This section incorporates interim guidance directive SB/SE-25-0510-023, titled "Reconciliation of Non-Insolvency LAMS Reports," dated May 11, 2010.

Effect on Other Documents

This material incorporates interim guidance directive SB/SE-25-0510-023, titled "Reconciliation of Non-Insolvency LAMS Reports," dated May 11, 2010.

Audience

SBSE Collection Employees and all Operating Divisions

Effective Date

(12-16-2011)

Scott D. Reisher
Director, Collection Policy
Small Business/Self-Employed

25.3.7.1  (12-16-2011)
Purpose of Reconciling Non-Insolvency LAMS Reports

  1. The accuracy of IRS financial statements depends on the timely posting of appropriate case controls to accurately reflect the status of taxpayer accounts. Reconciling the Litigation Accounts Management System (LAMS) TC 520 Non-Insolvency listing (the "Non-Insolvency LAMS Report" with current inventory on the Integrated Collection System (ICS) ensures that appropriate case controls have posted to tax modules involved in litigation. Specifically, the purpose of reconciling the Non-Insolvency LAMS Report is to:

    • Verify the accuracy of the Report against open Advisory cases on ICS.

    • Ensure that Transaction Code (TC) 520s are properly reversed when warranted.

    • Correct invalid TC 520s.

    • Ensure that TC 550s with proper definer codes are input, when warranted, prior to TC 520 reversals.

    • Facilitate coordination with other Advisory groups, as needed, to reflect assignment of entities to another Advisory jurisdiction.

    • Verify that all TC 521, TC 522 and/or TC 550 inputs have posted to IDRS prior to case closing.

  2. The Non-Insolvency LAMS Report is a tool to be used along with other means of maintaining proper case controls, such as

    • matching hardcopy case files against ICS inventory listings,

    • ensuring CSED protection via IDRS reviews, and

    • utilizing the Automated Lien System (ALS) to ensure timely lien refiles.

  3. Advisory is responsible for reviewing the Non-Insolvency LAMS Report on (no less than) an annual basis. See IRM 25.3.6.4.1Periodic Open Case Reviews, and IRM 25.3.6.5.4TC 520 Reversals.

25.3.7.2  (12-16-2011)
Background Information

  1. There is an entire series of LAMS Reports, used primarily by Insolvency. Each of these contains a listing of taxpayer accounts with open (unreversed) Transaction Codes (TC) 520s, along with other criteria based on Insolvency's needs.

  2. The Non-Insolvency LAMS Report is a listing of taxpayer accounts with one (1) or more open TC 520s utilizing unique closing codes (cc) that are generally not used for Insolvency cases.

  3. The following is a list of available cc’s on the Non-Insolvency LAMS Reports: 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82 and 84.

    Note:

    Closing codes 78 and 79 are currently not in use (reserved) so no accounts will be listed for these, and cc's 81 and 84 are primarily use for bankruptcy cases.

  4. The inclusion of taxpayer entities on a LAMS report generated for a particular jurisdiction (geographic area) is based on the current Universal Location Code (ULC) as shown on IDRS for these entities. Generally, the ULC of the taxpayer entity would be within the jurisdiction of the Advisory group assigned to the case, unless the taxpayer moved after the litigation at issue commenced.

  5. LAMS data is extracted from IDRS to the Automated Insolvency System (AIS-4) on a quarterly basis, generally in cycles 04, 17, 30 & 45. LAMS reports may only be retrieved by employees profiled for AIS-4 access (requires approval via Online 5081). For those Advisory groups who do not have AIS-4 access, requests for Non-Insolvency LAMS Reports should be made to the Insolvency Group Manager in that jurisdiction. The Advisory group’s request must specify the following:

    • the ULCs needed (those within the jurisdiction of the Advisory group making the request),

    • the TC 520 cc’s needed for each respective ULC, and

    • include a request for the "Multiple closing codes" report for each respective ULC.

  6. The AIS-4 Welcome Screen is documented with the date of the most recent LAMS data extraction from IDRS to AIS-4. Whenever LAMS reports are run, the dates listed on the reports will simply be the actual print dates.

    Note:

    Regardless of when LAMS reports are printed, until new IDRS data has been extracted to AIS-4, LAMS reports will continue to show the same accounts information even if subsequent changes have been made to those accounts on IDRS. Also, once a new cycle’s downloads have been extracted, the data from the prior cycle’s downloads will no longer be retrievable from AIS-4. Therefore, it is important to retain copies of (at least) the most recent Non-Insolvency LAMS Reports, along with the supporting documentation of the reconciliation. Retention of this data will likely be beneficial in analyzing and reconciling the next of Non-Insolvency LAMS reports issued.

25.3.7.2.1  (12-16-2011)
Non-Insolvency LAMS Report Output Formats

  1. There are three (3) Non-Insolvency LAMS Reports formats to choose from on AIS-4. They are:

    • SPREADSHEET (Excel) - recommended

    • PDF (Portable Document Format)

    • HTML (HyperText Markup Language)

25.3.7.2.2  (12-16-2011)
Contents of Non-Insolvency LAMS Reports

  1. The Non-Insolvency LAMS Reports contain fourteen (14) data fields. Listing headers for these fields vary slightly depending on the Report Output Format selected, and portions of some SPREADSHEET (Excel) headers may be hidden unless expanded further for full viewing (where headers vary for SPREADSHEET versus PDF or HTML, the SPREADSHEET header is listed first below). These fields are:

    • ULC (Universal Location Code)

    • TIN (Taxpayer Identification Number)

    • TFS/TFC (Taxpayer File Source or Taxpayer File Code - This field may be blank or contain a literal “*, N, V, W, P, or X”)

    • NC (Name Control)

    • DOD (date of death)

    • MFT (Master File Transaction)

    • Tax Period

    • UNREV 520 CYCLE1/520 Cycle 1(IDRS input cycle of the first TC 520 closing code listed - see CC1)

    • CC1 (first TC 520 closing code listed, but not always the first TC 520 cc input)

    • Recent CSED (Collection Statute Expiration Date indicator: P = Primary; S = Secondary; B = Both)

    • UNREV 520 CYCLE2/520 Cycle2 (IDRS input cycle of the second TC 520 closing code listed - see CC2)

    • CC2 (second TC 520 listed, if any, but not always the second TC 520 cc input)

    • Prior CSED (Collection Statute Expiration Date indicator: P = Primary; S = Secondary; B = Both)

    • Taxpayer Name/Taxpayer (taxpayer name)

    • Assessed Balance/Assessed Mod Bal (the assessed balance due of the account listed as of the date the data was extracted from IDRS)

25.3.7.2.3  (12-16-2011)
Universal Location Codes (ULCs)

  1. Taxpayer entities listed on LAMS reports are based on the current geographic location/ULC (primary location or “PRIMARY-LOC>” on IDRS) of the taxpayer. Accordingly, some taxpayer entities listed on the LAMS reports may not be in the same location as the Advisory group that initiated the TC 520(s) input.

  2. Because taxpayer entities shown on LAMS reports are based on the current geographic location of the taxpayer, the Non-Insolvency LAMS Reports may not be all-inclusive for the TC 520 cases that have been initiated and are being controlled in any given area. Coordination with other Advisory groups is therefore essential for ensuring the timely resolution of TC 520s when an entity appears on the report generated for a particular area, but the case is not being controlled by an advisor in that area. Use Publication 4235 or the SERP (Who/Where Tab) to locate the Advisory Groups.

  3. Access the IRM 5.19.1, Balance Due Job Aid, at the following link for a complete ULC listing assigned by state: - http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/5.19.dr/5.19.1-5.htm. This listing also includes Area Office (AO) assignments within each BOD code.

  4. The 6209 Code Retriever website may be used to determine the geographic location covered by a particular ULC. Go to http://serp.enterprise.irs.gov/databases/irm.dr/current/e6209/e6209home.htm, select "Universal Location Codes (2 digits)" as the Code Type, and input the two-digit ULC. You will receive the city or state covered by this particular ULC.

25.3.7.3  (12-16-2011)
Advisory Responsibility for TC 520s

  1. The Advisory group that initiates TC 520 input(s) is required to keep an open case on ICS and maintain proper litigation case controls. This includes ensuring that any required TC 550s and TC 521s/TC 522s are input and correctly posted to IDRS prior to case closing. Therefore, it is critical for Advisory to open an ICS case for each (TIN driven) entity for which it initiates a TC 520 input.

  2. Advisory is responsible for reconciling all taxpayer accounts with TC 520 closing codes 70, 75, 80 and 82, and is responsible for reconciling MFT 55 (TC 240 Penalty Code 618 for TFRP only) accounts for closing codes 71 and 73. (Campus Refund Litigation Units are responsible for all other MFTs/non-TFRP MFT 55 accounts for closing codes 71 and 73). For more information and a complete listing of all Non-Insolvency closing codes, see IRM 25.3.7.7, TC 520 Closing Codes, below.

    Note:

    Prior to IRM revisions in June 2005, TC 520 closing code 81 was also used by Advisory on all tax periods for which a proof of claim was filed in a probate case. Closing code 80 is now used in probate cases when the collection statute has been suspended under IRC § 6503(b) due to assets of the probate estate being in the control or custody of the court.

25.3.7.4  (12-16-2011)
Instructions for Generating Non-Insolvency LAMS Reports

  1. Access the AIS-4 Oracle Application Server.

    Note:

    LAMS reports may only be retrieved by employees profiled for AIS-4 access (requires approval via Online 5081). For those Advisory Groups who do not have AIS-4 access, requests for Non-Insolvency LAMS Reports should be made to the Insolvency Group Manager for that area. See IRM 25.3.7.2(5), above.

  2. Log into AIS-4. You will now be on the AIS Welcome Screen.

  3. Under "Misc Options" on the left, select "Reports."

  4. Upon accessing the Reports Menu, the first Reports category you will see listed is "Inventory." Use the scroll bar to the right of the Reports category listings and scroll down until you find the "LAMS" heading.

  5. Select "Non-Insolvency Listing."

  6. To the right of the screen under "Other" you will see "Universal Location Code" (ULC) with the default set at "All." Below the ULC, you will see "Unique Closing Code" with the default set at closing code "70." Below the "Unique Closing Code" option, you will see another selection option for the "Multiple Closing Code" Report; see IRM 25.3.7.4(13) below. Toward the bottom of the screen, the "Report Output Format*" default will show "SPREADSHEET."

  7. Using the scroll bar on the Universal Location Code, change the selection from “All” to the desired ULC location.

  8. Using the scroll bar on the closing code, select the desired closing code.

  9. Using the scroll bar on the Report Output Format, select the format desired: SPREADSHEET (Excel), PDF or HTML.

    Note:

    You may wish to run a sample report in each of the formats available to see the actual output for each. All three report formats list the cases in ascending TIN order, but the SPREADSHEET (recommended) allows you to sort the data for up to three of the fields in the Excel version (including alphabetical). The PDF and HTML reports data cannot be sorted.

  10. After selecting the desired ULC, closing code, and report format, left-click "Run Report" in the blue bar on the bottom of the screen and wait for your report to format. After the report data has been downloaded, you will be prompted to open, save, or cancel the report requested. Upon opening, if the report requested contains header fields only (no taxpayer data shown), then there are no taxpayer cases for the ULC/closing code you requested.

  11. If your case listing shows taxpayer data, and you have selected the SPREADSHEET (Excel) format, you may first have to save the report to your computer in order to utilize the sort feature. In saving the report, you may wish to rename it from the original "getjobid#####.xls" to something more easily recognizable, e.g. "ULC01cc80.xls" , especially if you intend to save multiple reports.

    • Open the saved Excel report.

    • Left-click "Data" from the tool bar on the top of the page, then select "Sort" on the drop-down menu to make the selections desired.

    • Print SPREADSHEET Reports in Landscape format in order to capture all of the fields of a report page on a single sheet. Left-click "File" from the tool bar on top. Select "Page Setup" from the menu. Left-click in the circle next to "Landscape." Left-click "Print."

    • After successfully printing, close the report.

  12. A "LAMS Non-Insolvency Listing" must be printed for each ULC assigned to a respective Advisory group for each of the TC 520 closing codes for which Advisory has reconciliation responsibility. See IRM 25.3.7.3(2), above.

  13. After securing all of the referenced LAMS Non-Insolvency Listings specified in paragraph 12, above, change the selection from "Unique Closing Code" to "Multiple closing codes." Once again, select the ULC for each location assigned to the respective Advisory group and run the "Multiple closing code" LAMS Report for each ULC required.

    Note:

    The "Multiple closing code" LAMS Report may include accounts with TC 520 cc's that Advisory is responsible to reconcile but may not otherwise have been listed on the ULC/specific cc LAMS Reports that Advisory has already run in the reconciliation process. The reason for this is that multiple TC 520 closing codes may have been input by Advisory and/or another area (e.g. Appeals, Insolvency, etc.). Some Multiple closing code LAMS Reports may not contain any Advisory TC 520 cc's in need of reconciliation. Other LAMS Reports that list both Advisory TC 520 cc's and another area's TC 520 cc's could warrant additional research and coordination with those other areas of responsibility (e.g. Advisory may need to contact Insolvency when an open bankruptcy TC 520 cc is found on the same tax period for which Advisory has input a TC 520 cc in conjunction with a civil suit case to ensure there is no violation of the automatic stay of collection imposed by the bankruptcy filing).

25.3.7.5  (12-16-2011)
Reconciliation Process

  1. Research the Integrated Collection System (ICS) to determine if there is an open Advisory case control for each taxpayer entity. If found:

    1. Note the LAMS listing with the case code and ICS assignment for open cases within your Advisory jurisdiction. Document the ICS history "Open TC 520 ccXX LAMS case" replacing "XX" with the actual closing code(s) for each MFT/tax period listed.

    2. If you find a case that is not within your Advisory jurisdiction, note the LAMS listing with the case code and the ICS assignment of the office to which it is assigned and document the ICS history "Open TC 520 ccXX LAMS case," including the MFT/tax periods to which the TC 520(s) have been input. This will generate a notification to the assigned advisor due to your non-assigned case access and will aid in proper TC 520 case controls.

  2. If an Advisory case is not open on ICS, review ICS closed case or archive histories (if any).

    1. If the Advisory case was previously worked on ICS, the history may provide sufficient information to determine the proper status and disposition of the account. Archived case information is available online when connected to the LAN (See Chapter 9 – Entity Detail of the ICS User Guide) and can be requested for cases closed on ICS more than six months but less than three years when needed.

    2. If the information to resolve a case within your Advisory jurisdiction is found to have been closed on ICS, open new ICS case controls, and take the proper action to resolve any unreversed TC 520(s). If a TC 550 is required, it must be input with the proper definer code prior to reversal of the TC 520.

    3. If ICS closed case or archive data is found on a case that is not within your Advisory jurisdiction, send the LAMS case data to the appropriate Advisory group for resolution. LAMS data can be sent electronically via Secure Message or in hardcopy using Form 3210. Document your copy of the LAMS listing with the disposition and associate any relevant documentation (ICS archive, Form 3210, Secure Message, etc.) with your LAMS listing for future reference.

  3. If no open, closed ,or archived data is on ICS, review IDRS:

    1. Review the Document Locator Number (DLN) for each TC 520. The first two digits of very old TC 520 inputs may reflect the ULC of the location that initiated the TC 520 inputs. Due to centralization, the first two digits of most TC 520 inputs will reflect the DLN of the campus location where the input was made.

    2. Also review DLNs of other inputs (TC 300s, etc.) to help identify the location/origin of the TC 520 input.

    3. Check for multiple TC 520s. Each TC 520 for which Advisory has responsibility must be reconciled.

    4. Utilize cc ENMOD and/or cc INOLES to look for x-ref Taxpayer Identification Numbers (TINs) for spouse, or d/b/a Employer Identification Numbers (EINs) of related entities. A TC 520 may have been input on accounts for all related entities, but a prior TC 521/522 may only have been input on one of the x-ref entities. The LAMS Report (or IDRS cc INOLES, depending on the timing of the IDRS data extraction) may also provide a DOD (date of death) on a decedent case.

    5. Check IDRS for TC 52X activity on other tax periods. You may find TC 521 inputs to other tax periods for the closing code you are researching.

    6. Check the IDRS cycle of the TC 520 for the year of input. The IDRS cycle year may be much more current than the actual date of the TC 520, indicating more recent Advisory account activity.

    7. Check history and control bases (open and/or closed) on IDRS cc TXMOD and/or cc ENMOD for data regarding the nature of case activity.

    8. Utilize IDRS cc IRPTRL, cc RTVUE, and/or BRTVU for other possible address information that may help to identify the origin of the Advisory group that initiated the TC 520 input.

    9. On unidentified cases that are new to your LAMS Report listing (not listed on the last LAMS reports run), but that contain TC 520s prior to the current year, check cc ENMOD for a recent change of address. On cc ENMOD, see ADDR-CHG-CYC> (this field is located to the right of the street address of the taxpayer and will contain the IDRS input cycle of the most recent change of address).

    10. Look for any and all clues IDRS may provide. If there are current or prior criminal investigation (CI) freeze code inputs (TC 910, TC 914, TC 918), contact the respective CI coordinator for that area for additional information that may assist in the reconciliation process.

    11. On imminent CSED, high-dollar, and/or high-profile cases, use IDRS cc ESTAB (using the DLN of the TC 520) to secure a copy of the document used to request the TC 520 (i.e. Form 3177, Form 4844, etc.) toward identification of the requestor of the input.

  4. Use PACER (Public Access to Court Electronic Records) to research suits, judgments, etc. (access requires Online 5081 approval) to locate information on open/closed court cases. Names searches can be done by using various court venues, including the nationwide U.S. Party Case Index. Access the PACER home page at http://pacer.psc.uscourts.gov/ to review all available research options.

  5. Contact the Department of Justice and/or your local Area Counsel to request a search to identify assignment of an open or closed case on their respective case data bases.

  6. If a TC 520 input was requested by another Advisory group, request reconciliation by that Advisory group.

    Note:

    Do not reverse any TC 520s requested by another Advisor. It is the responsibility of the Advisor who requested input of the TC 520 to ensure that the code is still valid or take proper closing actions to complete and resolve the case.

  7. Retain copies of reconciliation information/documents with the Non-Insolvency LAMS Report so discrepancies on future reports can be analyzed more readily.

25.3.7.6  (12-16-2011)
Reversing or Correcting TC 520 and TC 550 Updates

  1. If the TC 520 is to be closed, prepare Form 4844, Request for Terminal Action, to request TC 521 input. If the original TC 520 was created erroneously, a TC 522 input is used to reverse the TC 520.

  2. If a TC 550 CSED extension is required, prepare Form 4844 for TC 550 input, including the required definer code, prior to requesting input of the TC 521. See IRM 5.1.19.2.3(2) for a complete list of TC 550 definer codes. On any modules requiring a TC 550 input, the transaction date of the TC 550 must be greater than (after) the transaction date of the open (unreversed) TC 520; the transaction date of the subsequent TC 521 input must be after the transaction date used for the TC 550.

  3. Forward Forms 4844 to the appropriate Centralized Case Processing (CCP) Unit for your area. Form 4844 can be completed using the ICS template, then forwarded to the appropriate area e-mail box using the ICS electronic e-mail box. Also, in accordance withIRM 25.3.6.5.3.1, Assistance from the Field Resource Team (FORT), utilize FORT assistance when needed, after securing appropriate managerial approval.

  4. Monitor the input of the TC 550, TC 521, or TC 522 to ensure proper posting and updating on IDRS prior to closing the ICS case. Occasionally, inputs become unpostable. If this happens, IDRS must be analyzed to determine the cause of the problem and initiate the appropriate correction. For unpostable TC 550 inputs, see the Unpostable Codes in Section 8 of the IRS Processing Codes and Information book, Document 6209. Specifically, review UPC 178 reason codes for IMF and UPC 344 for BMF to aid in determining the corrective input action needed.

    Note:

    Some TC 520 closing codes require that the closing code also be used when the TC 521 is input; others do not. If an incorrect TC 521 (cc or no cc) is used, the transaction will go unpostable on IDRS. See the TC 520 Closing Code Chart in Section 11 of the IRS Processing Codes and Information book (Document 6209), (pages 11-37 and 11-38 of the 01-2011 revision), for a complete list of TC 520 closing codes, their respective characteristics and whether or not the closing code is required for reversal.

25.3.7.7  (12-16-2011)
TC 520 Closing Codes

  1. The following is a list of TC 520 closing codes for each type of LAMS Non-Insolvency Listing; cc 78 and cc 79 (reserved and currently not programmed for use) and cc 81 and cc 84 (primarily used for bankruptcy cases) are excepted. The characteristics of each closing code (cc) are specified as per the IRS Processing Codes and Information book (Document 6209). Some IRM references are provided, and procedural recommendations are included for reconciliations.

  2. Follow the procedures in IRM 25.3.7.5, Reconciliation Process, above, for each of the following closing codes.

25.3.7.7.1  (12-16-2011)
TC 520 cc 70

  1. TC 520 cc 70 is used for suits by or against the United States when the following case controls are appropriate:

    • the CSED is NOT suspended; and

    • account status IS changed to Status 72 on IDRS.

  2. Generally, TC 520 cc 70 is used for the following suits:

    • Foreclosure of Federal tax lien only (cc 80 is used in a suit for both lien foreclosure and reducing assessments to judgment)

    • Failure to honor a levy

    • Open safe deposit box

    • Injunction action (again, cc 80 would also be used in a suit for injunctive relief wherein the suit is also seeking judgment for the underlying taxes involved)

    • Wrongful levy

  3. From January 18, 1999, to January 1, 2000, cc 70 was also designated for use in Collection Due Process (CDP) cases. Any taxpayer account with a TC 520 cc 70 input prior to January 18, 1999, should be researched further by Advisory as these would not be CDP cases.

  4. Effective January 1, 2000, TC 520 cc's 76 and 77 were created for use in CDP cases. See IRM 25.3.7.7.7, below. Because information regarding use of the new TC 520 cc's 76 and 77 had not yet been received, TC 520 cc 70 continued to be used (in error) in some CDP cases filed after January 1, 2000.

  5. On cases where CDP TC 520s cc 70 may still be outstanding in error, a trend may be noted on the TXMOD to help identify these.

    1. On TXMOD, a TC 971 action code (ac) 69 is present to document that a Due Process Notice had been issued;

    2. TC 971 ac 66 would follow (Return receipt signed); and then

    3. TC 520 cc 70 (CDP).

      Note:

      This sequence of transaction code inputs does not preclude the possibility that cc 70 was input relative to a suit-type case.

  6. Advisory groups should coordinate with Appeals offices to identify, resolve, and correct of any outstanding TC 520s cc 70 that were previously input in conjunction with the processing of CDP cases. TC 520 cc 70 inputs were also used by the Automated Collection Branch (ACS); these accounts would not have been in status 26 (field assignments), only status 22/24 (ACS/Queue).

25.3.7.7.2  (12-16-2011)
TC 520 cc 71

  1. TC 520 cc 71 is used for Refund Litigation cases when the following case controls are appropriate:

    • the CSED is NOT suspended, and

    • account status is NOT change to status 72 on IDRS.

  2. When a refund claim or suit on a Trust Fund Recovery Penalty (TFRP) case is filed, and it does not meet the criteria for input of TC 520 cc 82, (see IRM 25.3.7.7.9, below), TC 520 cc 71 may be used. Since the MFT 55 account at issue will not be suspended to Status 72 with this TC 520 input, it simply creates a -W freeze on the account. If the claim review indicates that the TFRP assessment is not likely to be sustained due to IRS error, strong consideration should be given to using TC 520 cc 73, see IRM 25.3.7.7.4, below. If Collection action continues on a TFRP assessment that cannot be sustained, the taxpayer may be successful in pursuing additional legal action against the IRS later. If a counterclaim for judgment is filed by the Department of Justice in a TFRP refund suit, a TC 520 cc 80 would also be input; see IRM 25.3.7.7.8, below.

  3. Advisory is responsible for reconciling TC 520 cc 71 inputs on MFT 55, TC 240 Penalty Code 618 TFRP accounts only.

25.3.7.7.3  (12-16-2011)
TC 520 cc 72

  1. TC 520 cc 72 is used for Tax Court cases controlled by Appeals, and has the following attributes:

    • the CSED is NOT suspended, and

    • account status is NOT changed to Status 72 on IDRS.

  2. Accounts on this list are controlled by Appeals; therefore, there is no requirement for Advisory to request or reconcile this listing.

25.3.7.7.4  (12-16-2011)
TC 520 cc 73

  1. TC 520 cc 73 is used for Refund Litigation when the following case controls are appropriate:

    • the CSED is NOT suspended, and

    • account status IS changed to Status 72 on IDRS.

  2. Because this closing code suspends the module from active collection to Status 72 on IDRS, but does not suspend the CSED, it would not generally be used by Advisory. Should Advisory request input of TC 520 cc 73 on a TFRP refund litigation case, close monitoring of the CSED is required. Advisory is only responsible for MFT 55, TC 240 Penalty Code 618 TFRP accounts. Generally, Advisory would use TC 520 closing code 82 on TFRP refund litigation suits. See IRM 25.3.7.7.9, below, for criteria for using TC 520 cc 82. Refund suits for all other MFTs and non-TFRP MFT 55 accounts are the responsibility of Service Center Refund Litigation Units. See IRM 25.3.7.7.2, above, for criteria for using TC 520 cc 71. If a counterclaim for judgment is filed by the Department of Justice in a TFRP refund suit, a TC 520 cc 80 would also be input; see IRM 25.3.7.7.8, below.

25.3.7.7.5  (12-16-2011)
TC 520 cc 74

  1. TC 520 cc 74 is used for Tax Court cases controlled by Area Counsel when the following case controls are appropriate:

    • the CSED is NOT suspended, and

    • account status IS changed to Status 72 on IDRS.

  2. These cases are worked and to be controlled by Appeals, in conjunction and coordination with Area Counsel. Advisory is not required to request or reconcile this listing.

    Note:

    As with all other Non-Insolvency LAMS Reports, taxpayer entities are listed based on the current geographic location of the taxpayer per IDRS; therefore, some taxpayer entities may not be assigned to the local Area Counsel office (nor would these cases appear on Counsel’s General Litigation (GL) listings for the respective area). If, for any reason, Area Counsel requests Advisory assistance regarding such a listing, Advisory should alert Area Counsel to the "geographic" nature of the listing so that Counsel can use their case management system to identify the appropriate Area Counsel office(s) controlling the case.

25.3.7.7.6  (12-16-2011)
TC 520 cc 75

  1. TC 520 cc 75 is used for litigation cases when the following case controls are appropriate:

    • the CSED is NOT suspended, and

    • account status is NOT changed to Status 72 on IDRS.

  2. An example of a case where use of TC 520 cc 75 would be appropriate is a Failure to Honor Levy suit, particularly where only a partial satisfaction of a taxpayer’s balance due would be realized. In an action of that type, the liability would remain open for additional collection activity as warranted. Input of TC 520 cc 75 simply creates a -W freeze on the account and alerts other IRS employees of the litigation.

25.3.7.7.7  (12-16-2011)
TC 520 cc 76 and 77

  1. Effective January 1, 2000, TC 520 cc 76 was created for use in Collection Due Process (CDP) cases under IRC § 6320 (filing of Notice of Federal Tax Lien); and TC 520 cc 77 was created for use in CDP cases under IRC § 6330 (levies). These closing codes have the following attributes:

    • the CSED is suspended, and

    • account status IS changed to Status 72 on IDRS.

  2. TC 520 cc 76 and 77 inputs are requested by Appeals, and these cases are controlled by Appeals in conjunction with Collection. Therefore, there is no requirement for Advisory to request or reconcile this listing.

  3. Commencing January 18, 1999, and prior to the creation of cc’s 76 and 77, TC 520 cc 70 (originally used for suit-type litigation cases only) was also designated for use on all types of CDP cases. With the implementation of TC 520 cc’s 76 and 77, cc 70 reverted for use in suit-type litigation cases only. See IRM 25.3.7.7.1, TC 520 cc 70, above.

  4. All CDP cases, regardless of their points of origin (field, ACS or customer service centers) will appear on the cc 76 and cc 77 LAMS listings.

25.3.7.7.8  (12-16-2011)
TC 520 cc 80

  1. TC 520 cc 80 is used in a number of different situations when the following case controls are appropriate:

    • the CSED is suspended, and

    • the account status is changed to Status 72 on IDRS.

  2. TC 520 cc 80 is most commonly used in a Suit to Reduce Assessments to Judgment. Because the CSED is suspended upon the filing of the suit under IRC § 6502(a), the TC 520 cc 80 is generally input as of the date the suit is filed. However, if the CSED is imminent, the TC 520 cc 80 may be input before the suit is filed if certain conditions are met. See IRM 25.3.6.3.2.2, Cases With Imminent CSEDS.

  3. In a successful Suit to Reduce Assessments to Judgment, a TC 550 (definer code 04) must be input prior to reversal of TC 520. TINs on the cc 80 list should be screened against ICS to identify active Advisory cases. ICS Archive Transcript reviews may also be needed for Advisory cases that were previously closed but for which there may have been a failure to complete IDRS inputs, including required TC 550 CSED extensions and TC 520 reversals.

    Note:

    Although a TC 520 cc 80 suspends the CSED on a respective TXMOD to which it is input, it will not systemically extend the CSED when it is reversed. If a CSED extension is warranted (i.e., a judgment is granted), a TC 550 (definer code 04) must be input. The TC 550 must be input prior to input of the TC 521. See IRM 25.3.5.6, Procedures for Judgments for Assessed Liabilities. The transaction date of the TC 550 must be after the transaction date of the TC 520, but before the date of the original CSED. The transaction date of the subsequent TC 521 input must be after the transaction date used for the TC 550.

  4. TC 520 cc 80 is also used to keep an account open in order to post payments that are received after the CSED. Credits posted to a TXMOD after a TC 520 cc 80 has been input but prior to its reversal, will not refund, even if the collection statute is shown to be expired upon subsequent input of the TC 521. In order to ensure that payments will not refund, TC 520 cc 80 is used in the following circumstances:

    • To suspend the CSED pending application of sale proceeds from a pre-CSED seizure – see IRM 5.1.19.4(3).

    • To suspend the CSED pending application of levy proceeds to expired module(s) from a Notice of Levy that was served pre-CSED – see IRM 5.1.19.4(4).

      Note:

      Proceeds from a Notice of Levy on Wages, Salary and Other Income that was served pre-CSED and for which wages were earned pre-CSED may only be applied to modules for which the CSED expires thereafter.

  5. Effective June 23, 2005, TC 520 cc 80 is also used in probate cases when the collection statute is suspended due to assets of the probate estate being in the control or custody of the court – see IRC 6503(b).

25.3.7.7.9  (12-16-2011)
TC 520 cc 82

  1. TC 520 cc 82 is used in cases involving the Trust Fund Recovery Penalty (TFRP) when the following case controls are appropriate:

    • the CSED is suspended, and

    • the account status is changed to Status 72 on IDRS.

  2. See IRM 5.7.7.4.2Withholding Collection — IRC 6672(c), Policy Statement P-5-16 in IRM 1.2.14.1.4 and IRM 25.3.6.3.2.1, Trust Fund Recovery Penalty (TFRP) Litigation, for more information regarding the situations where the IRS is required to withhold collection of a TFRP assessment. See also IRC § 6672(c) and IRC § 6331(i) and note exceptions to levy suspense in IRC § 6331(i)(3)(A).

  3. The transaction date of a TC 520 cc 82 input would be either the date the taxpayer complied with the requirements of IRC § 6672(c), or the date of the filing of a civil suit for refund in a district court case. TC 520 cc 82 is used to stay collection until the final resolution of court proceedings and the taxpayer’s claim for a refund.

    Note:

    Although a TC 520 cc 82 suspends the CSED on the respective TXMOD to which it is input, it will not systemically extend the CSED when it is reversed. If the Government is not successful in its defense of a TFRP refund suit, the TFRP assessment must be abated or adjusted in accordance with the court's ruling. Generally, the Government will file a counterclaim for judgment of the TFRP. If a judgment is obtained, a TC 550 with definer code 04 will be input to extend the CSED for 20 years from the date the judgment was entered prior to input of any TC 521. See IRM 25.3.5.6, Procedures for Judgments for Assessed Liabilities.

25.3.7.8  (12-16-2011)
Bankruptcy Closing Codes

  1. Note that input of a bankruptcy (or other) TC 520 closing code might supersede an Advisory or other Non-Insolvency TC 520 for purposes of the Non-Insolvency LAMS Report. In other words, a case that is still open as a suit might drop from a TC 520 cc 70 report if the taxpayer subsequently files a bankruptcy petition for which a TC 520 cc 85 (or other bankruptcy closing code) is input. These cases should then appear on the "Multiple closing codes" Non-Insolvency LAMS Report for a given ULC. See the instructions inIRM 25.3.7.4(13), Instructions for Generating Non-Insolvency LAMS Reports, above.

  2. Whenever a taxpayer entity is identified as having both an open Advisory-controlled (TC 520) case and an open bankruptcy case, Advisory and Insolvency personnel should closely coordinate with one another to ensure that neither Advisory nor Insolvency erroneously reverses the TC 520 inputs of the other.

    Note:

    When a taxpayer files bankruptcy, the automatic stay prohibits the commencement or continuation of a judicial or other civil action against the debtor (taxpayer). Accordingly, relief from the automatic stay must be obtained before any pending actions against the debtor may proceed.


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