25.15.11  Taxpayer Advocate Service Contacts and Identity Theft Referrals

Manual Transmittal

July 29, 2014

Purpose

(1) This transmits revised IRM 25.15.11, Relief From Joint and Several Liability, Taxpayer Advocate Service Contacts and Identity Theft Referrals.

Material Changes

(1) Editorial changes have been made throughout this IRM.

(2) IRM 25.15.11.4(5) removed the stop number from the PO Box address.

(3) IRM 25.15.11.6(1)(c) removed the word Examiners and reworded the sentence for clarity.

(4) IRM 25.15.11.7(f) updated to have all claims received sent to the area office if there is an open control.

(5) IRM 25.15.11.11 has been moved and renumbered to IRM 25.15.11.11.1.1. The removal also resulted in subsequent subsections to be renumbered.

(6) IRM 25.15.11.11.1 split (1) into (1) and (2) this also resulted in subsequent steps to be renumbered.

(7) IRM 25.15.11.11.2(1) clarified the 2 different forms and IRM references for cases received from IPSU.

(8) IRM 25.15.11.11.3(3) Updated to Letter 5064C.

Effect on Other Documents

IRM 25.15.11, Taxpayer Advocate Service Contacts and Processing of Innocent Spouse Cases, dated June 14, 2013 is superseded.

Audience

Innocent Spouse employees in Wage and Investment (W&I), Small Business/Self Employed (SBSE) and Taxpayer Advocate Service employees

Effective Date

(07-29-2014)


Steve C. Klingel
Director, Reporting Compliance
Wage and Investment Division

25.15.11.1  (06-14-2013)
Overview

  1. The areas will identify cases and receive referrals on cases meeting taxpayer advocate criteria and identity theft (IDT) criteria.

  2. The National Taxpayer Advocate (NTA) works in partnership with the Commissioners of Wage and Investment (W&I), and Small Business/Self Employed (SB/SE) Divisions to address the need to correctly and efficiently resolve innocent spouse claims. The Taxpayer Advocate Service (TAS) will refer cases on Form 12412 Operations Assistance Request (OAR).

    Note:

    TAS does not have the authority to make innocent spouse determinations.

  3. The Accounts Management (AM) Identity Protection Specialized Unit (IPSU) team was established to assist taxpayers who are, or may become, victims of identity theft.

  4. AM IPSU may refer accounts to the Cincinnati Centralized Innocent Spouse Operation (CCISO) in the following manner:

    1. A secure e-mail may be sent to the operation's Identity Theft Liaison from AM IPSU when a case meets single function criteria. Multiple cases residing in one function will not be monitored by AM IPSU. The function assigned will take all actions required to resolve the taxpayer’s issues and act as the point of contact through resolution of the single IDT issue. See IRM 10.5.3.2.3.1, Multiple Function Criteria (MFC) vs. Single Function.

    2. Form 14027-B, Identity Theft Case Referral will be sent to the Identity Theft Liaison to notify the operation that an AM IPSU caseworker will be monitoring case activity and following up on a regular basis. This form is required when Multiple Function Criteria (MFC) is met. MFC is defined as an identity theft case requiring resolution across functions. See IRM 21.9.2.4.3, Multiple Function Criteria (MFC) – IDTX and 10.5.3.2.10.1, The Identity Protection Specialized Unit (IPSU) and Referrals to Other Functions on Form 14027-B .

    3. A Form 14103, Identity Theft Assistance Request (ITAR) will be treated similarly to the Taxpayer Advocate Service (TAS) Operations Assistance Request (OAR) process, including time frames. These situations meet TAS criteria 5 -7 AND involve identity theft. Refer to IRM 10.5.3.2.10.1.3, Functional Responsibilities Regarding Referrals Meeting TAS Criteria 5-7, Identity Theft Assistance Requests (ITAR) to the IPSU for additional information and guidance.

    4. Any referrals received on an open innocent spouse claim, require the coordination between the Cincinnati Centralized Innocent Spouse Operation (CCISO) and other Compliance functions to resolve the identity theft issue.

25.15.11.2  (06-14-2013)
Taxpayer Advocate Case (TAS) Criteria

  1. Refer taxpayers to TAS if the taxpayer specifically requests TAS assistance or is facing economic burden (TAS criteria 1-4), and the taxpayer’s issue cannot be resolved the same day. See IRM 13.1.7.2, TAS Case Criteria. The definition of "same day" is within 24 hours. "Same day" cases include cases that can be completely resolved in 24 hours, as well as, cases in which you have taken steps within 24 hours to begin resolving the taxpayer’s issue. Do not refer "same day" cases to TAS unless the taxpayer asks to be transferred to TAS and the case meets TAS criteria. Refer to IRM 13.1.7.4, Same Day Resolution by Operations. When you refer cases to TAS, use Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), and forward to TAS. For more information on Taxpayer Assistance Order (TAO) refer to IRM 13.1.20, TAS Taxpayer Assistance Order (TAO) Process.

25.15.11.3  (06-14-2013)
How Will TAS Innocent Spouse (IS) Inquiries/Cases Be Received?

  1. TAS cases are tracked on the Taxpayer Advocate Management Information System (TAMIS). Below are some ways TAS receives innocent spouse cases:

    • Referrals on Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order) from IRS employees who have concluded that the taxpayer meets TAS case criteria and the IRS employee could not resolve the case in the same day. See IRM 13.1.7.4, Same Day Resolution by Operations.

    • Direct contacts from the taxpayer to TAS offices or toll-free line 877-777-4778.

25.15.11.4  (07-29-2014)
Role of TAS in the IS Program

  1. TAS should educate taxpayers before a claim is filed.

    1. Elicit enough information to be sure filing for innocent spouse relief is the appropriate avenue of relief to pursue.

    2. Suggest other options such as full payment, installment agreement, offer-in-compromise, claim for refund, audit reconsideration, or Appeals conference, depending on the facts and circumstances of the individual taxpayer.

  2. TAS should help facilitate the process for the taxpayers.

    1. Encourage taxpayers to avail themselves of all opportunities to resolve the issue (e.g., group manager or Appeals conferences).

    2. Explain the process to taxpayers and provide guidance as to what paperwork, information, or other documentation is appropriate to support their claim.

    3. Use and update the TAMIS to track contacts with innocent spouse claimants. Complete histories can provide background information which could aid the examiner in making decisions.

  3. Advise the taxpayer of current processing timeframes. See IRM 13.1.10.14, Innocent Spouse Inquiries/Relief from Joint and Several Liability, for more information on timeframes.

  4. Inform taxpayers of the legal requirement for IRS to notify and offer an opportunity for participation to the non-requesting spouse (NRS). Employees should also inform taxpayers of procedures for claimants who are concerned about potential abuse or physical retaliation by the NRS.

  5. Advise taxpayers they should file Form 8857, Request for Innocent Spouse Relief, directly with the Cincinnati Centralized Innocent Spouse Operation (CCISO) at:

    IRS
    PO Box 120053
    Covington, KY 41012

    or fax to: 1–855–233–8558


    In some instances, the taxpayer may want to work with the Local Taxpayer Advocate (LTA) and have the case monitored until completion.

  6. Advise taxpayers that TAS caseworkers do not have the authority to make innocent spouse determinations. The decision will be made by an examiner in the CCISO, or in the Area Field Office, based on the merits of the case.

  7. Employees may refer taxpayers to the Spousal Eligibility Explorer on the IRS website at http://www.irs.gov. Instruct the taxpayer to search for "Explore if you are an Eligible Innocent Spouse" .

25.15.11.5  (07-17-2009)
Use Integrated Data Retrieval System (IDRS) Command Code (CC) Innocent Spouse Tracking System (ISTS) to Verify Status of IS Claims

  1. The Innocent Spouse Tracking System (ISTS) should be the first step in researching the status of any outstanding innocent spouse claim. See IRM 25.15.14.2, Introduction, for more information on ISTS.

  2. The status of an innocent spouse claim can be tracked through ISTS, which captures 33 different stages of the process. Employees who respond to taxpayer inquiries must have access to IDRS CC ISTS. Functional TAS IS Coordinators can make arrangements for access to computer-based training (CBT) and provide authority for new command codes.

  3. TAS employees will use IDRS CC ISTSRT and CC ISTSRA to monitor innocent spouse claims.

25.15.11.6  (06-14-2013)
Innocent Spouse Form 8857 Claim Processing Timeframes

  1. To keep taxpayers informed about the status of their claims, it is important to recognize the timeframes involved in processing Form 8857, Request for Innocent Spouse Relief. To process innocent spouse cases, many steps must be taken. Some are required by law and shortcuts cannot be taken. TAS employees should work with taxpayers to keep them informed of the progression of their cases until it is completed.

    1. Before a claim can be considered, the account must be researched, administrative files retrieved, and often, additional information secured from the taxpayer.

    2. Included in the processing framework is the legal requirement to notify the NRS of the claim and offer an opportunity to participate in the administrative proceedings. The NRS must be given a reasonable amount of time to respond and for all correspondence to be associated with the file (generally 45 days).

    3. Additionally, the law requires that a notice of determination be issued. The requesting spouse (RS) has 90 days from the date of the letter to petition the Tax Court. The RS, prior to the issuance of the determination, generally gets a letter giving the RS 30 days to request an administrative appeal. For claims where there is a preliminary determination to grant full or partial relief, the NRS will receive a 30 day letter allowing an administrative appeal of the determination. A Form 870-IS, Waiver of Collection Restrictions in Innocent Spouse Cases; may be secured and this will reduce timeframes in some cases.

    4. In optimal circumstances, steps required by legal provisions alone, take 165 days. Original notification to NRS (45 days), notification of preliminary determination (30 days) and notification of final determination (90 days) to both the Requesting Spouse RS and NRS. Keep this in mind when estimating timeframes for taxpayers.

25.15.11.7  (06-14-2013)
Case Processing of Original Form 8857

  1. Advise the taxpayer to file Form 8857, Request for Innocent Spouse Relief, directly with CCISO. If, however, the claim is received in TAS, then:

    1. Establish the case on TAMIS.

    2. Check IDRS for an open audit indicator, transaction code (TC) 420.

    3. Check ISTS to ensure claim is not a duplicate.

    4. Ensure that claim is processable and complete (e.g., correct tax year(s), jurat and any explanations attached).

    5. Forward the case file (i.e., TAMIS history and supporting documents) to CCISO.

    6. If there is an open field control, use the Form 12412, Operations Assistance Request (OAR), process to forward the claim and claims received on any other years to the Area Innocent Spouse Coordinator in Planning and Special Programs (PSP).

25.15.11.8  (06-14-2013)
Operations Assistance Request (OAR) Process

  1. Use the Form 12412, Operations Assistance Request (OAR), process to forward Form 8857, Request for Innocent Spouse Relief, to CCISO. For procedures about the OAR and Service Level Agreement (SLA) process see IRM 13.1.19, TAS Operations Assistance Request (OAR) Process.

    Note:

    Innocent spouse cases have processing timeframes based on statutory requirements. The statutory timeframes cannot be circumvented, even for economic burden cases. Check ISTS to determine if the time frames are being met. If the timeframes are not met and the case requires expedite processing, the TAS employee will include an explanation with the OAR.

25.15.11.9  (06-14-2013)
Contacts on Form 8857 Already Filed

  1. After researching ISTS to determine the location, status, and employee assigned to the claim, establish the case on TAMIS. TAS will continue to monitor the case on ISTS and TAMIS and keep the taxpayer apprised of the progress of his/her claim.

  2. If the case has already been established on the TAMIS system and it appears the case is not progressing through the stages in normal time frames, the TAS employee should work with the examiner to ensure the case is being handled properly.

  3. If you receive a Form 12412, Operations Assistance Request (OAR), follow the special instructions TAS has entered on the Form 12412. Contact TAS for any clarification or if you do not agree with the actions requested by TAS. For further guidance see http://tas.web.irs.gov/policy/sla/default.aspx for the TAS SLA with W&I. For additional information refer to IRM 13.1.19, TAS Operation Assistance Request (OAR) Process.

25.15.11.10  (03-21-2008)
When a TAS IS Case Can Be Closed

  1. The goal of TAS is to resolve the taxpayer’s problem(s) completely and prevent the taxpayer from having to contact TAS in the future on the same issue.

  2. TAS controlled cases should remain open until every action on the claim has been completed including final account adjustments or appeal determinations.

  3. Assure all Master File Tax (MFT) 31 actions are closed before closing a TAS case.

  4. Use the OAR process if actions are needed on these cases.

25.15.11.11  (07-29-2014)
Identity Theft Case Referrals

  1. Pending claim indicators will be input within 48 hours of receipt on all identity theft referrals. TC 971 action code (AC) 522 inputs are required to identify pending identity theft claims and the identity theft documents received for a specific tax year. If there is not an identity theft tracking indicator on the account, input TC 971 AC 522 PNDCLM. If the coding already exists do not input a second code for the same tax year. See IRM 10.5.3.2.5, Initial Allegation or Suspicion of Tax-Related Identity Theft - Identity Theft Indicators and IRM 10.5.3.2.5.1, Taxpayer Initiated Allegations of Identity Theft - Pending Claim Identity Theft TC 971 AC 522 PNDCLM.

    Note:

    For input instructions see IRM 10.5.3-12, IMF Only TC 971 AC 522 Tax-Related Identity Theft, Case Status (Initial Claim/Suspicion and Supporting Documents). Input EXAM as the program, even if it is Automated Underreporter (AUR). This is so the Examination Headquarters analyst will be able track it as an innocent spouse issue. Format should be: WI one space EXAM one space and the appropriate Tax Administration Source. In the Remarks area enter IDENTITY THEFT.

  2. IDRS control bases are to be input for all identity theft cases. Use control category code "TPPI" for all identity theft controls. Control bases must be input within 5 days if Form 14039Identity Theft Affidavit, is received.

  3. Do not update the name or address on master file when the social security number (SSN) owner submits an identity theft claim or return. The name and/or address update will be completed by the specialized teams when the claim has been verified and the valid IDT determination made. Any correspondence to the SSN owner will require manual input of the address information on IDRS if different from the entity information. See IRM 10.5.3.2.6.4.1, When to Update the Victim's Address.

  4. All identity theft cases are considered priority and must be worked accordingly.

  5. Time spent working identify theft cases should be reported under organization function program (OFP) code 713-91210 for a paper case and 703-91210 for a phone call.

25.15.11.11.1  (07-29-2014)
Identity Theft Case Referrals From Accounts Management (AM) Identity Protection Specialized Unit (IPSU)

  1. The Accounts Management (AM) Identity Protection Specialized Unit (IPSU) was established to be the initial contact to assist taxpayers who are victims of ID Theft. IRM 21.9.2, Individual Master File (IMF) Accounts Management Identity Theft, and IRM 10.5.3, Identity Protection Program, provide guidance on the actions completed by IPSU.

  2. When IPSU determines the identity theft claim or allegation is a tax-related incident, a referral is prepared and issued to the controlling function. There are three referral types prepared by AM that are routed to the Identity Theft or Identity Theft Assistance Request (ITAR) Liaison, as applicable:

    1. When AM IPSU receives allegations of identity theft or identity theft claims and determines another function has open controls on the case or if the taxpayer is responding to a function's notice, they will contact the functional Identity Theft Liaison (ITL) per IRM 21.9.2.4.1, Self Identified - Tax-Related Identity Theft - IDT2, if it meets single function criteria. See IRM 10.5.3.2.3.1, Multiple Function Criteria (MFC) vs. Single Function.

    2. IPSU will monitor taxpayer accounts affected by identity theft when resolution requires actions/resolution by multiple IRS functions. Multiple Function Criteria (MFC) is defined as an identity theft case requiring resolution across functions. IPSU will issue the Form 14027-B, Identity Theft Case Referral IRM 21.9.2.4.1, Self Identified - Tax-Related Identity Theft - IDT2. IPSU will place a monitoring control on the taxpayer’s accounts to ensure that all taxpayer issues have been resolved prior to case closure. For additional information on Form 14027-B, refer to IRM 10.5.3.2.10.1, The Identity Protection Specialized Unit (IPSU) and Referrals to Other Functions on Form 14027–B.

    3. Cases that meet TAS criteria 5-7 and involve identity theft (See IRM 13.1.7.2, TAS Case Criteria and IRM 21.9.2.9, Identity Theft Assistance Request (ITAR) - General information), will be referred on Form 14103, Identity Theft Assistance Request (ITAR). See IRM 10.5.3.2.10.1.2, The Identity Protection Specialized Unit (IPSU) and Referrals to Other Functions on Form 14103.

  3. Identity theft cases referred using Form 14103, Identity Theft Assistance Request (ITAR), MUST have an acknowledged receipt within 5 business days via secured e-mail or fax number provided by the AM IPSU employee on the form.

    1. Review form and determine whether the recommended action is appropriate and the requested completion date is reasonable.

    2. Contact the AM IPSU employee if there are questions regarding the recommended action or if additional time is required. Work with the AM IPSU employee to reach an agreement on the substantive case issues, recommended actions and follow-up and completion dates.

  4. The Cincinnati Centralized Innocent Spouse Operation (CCISO) will maintain control of the identity theft referral until a determination of identity theft is made on open innocent spouse claims. The CCISO will coordinate with the appropriate compliance function.

25.15.11.11.1.1  (07-29-2014)
Accounts Management Identity Protection Specialized Unit (IPSU) Criteria

  1. Employees may identify cases that meet the criteria to be referred to AM IPSU.

  2. AM IPSU generally assists taxpayers whose situations meet TAS criteria 5 -7 AND involve identity theft. Applicable cases will now be considered IPSU criteria. See IRM 21.9.2.9, Identity Theft Assistance Request (ITAR) - General Information.

    1. Even if a case meets TAS criteria 5-7, there are some situations when it is in the best interest of the taxpayer to retain the case in TAS for resolution. See IRM 21.9.2.9(2) Table, Exceptions to IPSU Processing, for a list of these situations.

    2. If a case meets IPSU criteria, refer the case to AM IPSU using Form 4442, Inquiry Referral. Ensure any attachments from the taxpayer are included. Issue Letter 86C or other applicable letter to the taxpayer informing the taxpayer of this referral/transfer.

    3. The completed referral will be sent using the Account Management Services (AMS) or by secure E-mail to *W&I-ITAR or via the designated fax number, 855-807-5720 within 24 hours of when the IPSU criteria was identified.

    4. A detailed narrative must be entered in Section B of the Form 4442 explaining the taxpayer's issue, and why it meets IPSU criteria.

    5. Use category code MISC when controlling on the IDRS for all referrals other than electronically routed referrals generated in AMS. Refer to IRM 21.3.5.4.2.2, Controlling Referrals.

    6. Inform the taxpayer he/she can expect contact either by phone or correspondence within 10 business days from the date of receipt. Inform the taxpayer he/she should call the IPSU toll free number of 800-908-4490 if he/she does not receive correspondence or a confirmation phone call within the 10 business days.

  3. Upon receipt of an identity theft case, employees will review the account to determine if Multiple Function Criteria (MFC) issues exist. AM IPSU will monitor taxpayer accounts through resolution when a taxpayer’s account requires corrective actions by more than one function. See IRM 10.5.3.2.3, Multiple Function Criteria (MFC) Cases Requiring Referral to IPSU for Monitoring - IMF, for procedures on referring to AM IPSU on Form 14027-A, Identity Theft Referral for IPSU Monitoring.

    Note:

    Open controls in Compliance functions would be considered a “single function” because both programs reside under Compliance.

25.15.11.11.2  (07-29-2014)
Coordinating With Other Functions on Identity Theft Referrals

  1. CCISO will coordinate with IPSU when a Form 14027-BIdentity Theft Case Referral is received, indicating that multiple functions are involved in the resolution of the identity theft and any other issues on the case. See IRM 21.9.2.4.3, Multiple Function Criteria (MFC) – IDTX for more information. CCISO will also coordinate with IPSU if a Form 14103 Identity theft Assistance Request (ITAR) is received indicating the case meets TAS criteria 5 -7 AND involves identity theft. See IRM 21.9.2.9, Identity Theft Assistance Request (ITAR) - General Information for more information.

  2. CCISO will coordinate with other compliance areas directly to resolve the identity theft issue.

    1. Forward the identity theft claim to the functional liaison for a determination of identity theft. Claims received on closed Examination or AUR cases will be referred to the area that completed the assessment.

      Note:

      Provide copies of information received with the innocent spouse claim to aid in the determination.

    2. Update IDRS base.

    3. Update ISTSR to Stage 06, IDT while awaiting a response.

    4. Add a history item to AMS.

    5. Follow up with the function if no response within 30 days.

  3. If the function determines that the identity theft (IDT) claim is INVALID (no identity theft issue):

    1. If applicable, return the completed Form 14103, Identity theft Assistance Request (ITAR) or Form 14027-B with copies of all letters and forms to the AM IPSU employee. See IRM 21.9.2.9, Identity Theft Assistance Request (ITAR) - General Information.

    2. Include copy of Form 14103 or Form 14027-B in case file.

    3. Ensure that the TC 971 AC 522 has been reversed as applicable.

    4. Close IDRS IDT control base with "INVLDIDT" .

    5. Continue processing innocent spouse claim.

  4. If the function determines that the identity theft (IDT) claim is VALID (identity theft occurred):

    1. If applicable, return Form 14103 (check the "OTHER" box in Section VI) or Form 14027-B indicating that it needs to be reassigned to the function working the identity theft issue.

    2. State that "Valid IDT claim requires IDT processing, not innocent spouse processing. Innocent spouse being closed as inapplicable" .

    3. Indicate the function and office that has accepted the identity theft claim.

    4. Close innocent spouse claim as non-qualifying with activity code "ACTP" .

    5. Close IDRS IDT control base with "VALIDIDT"

25.15.11.11.3  (07-29-2014)
Identity Theft Referral and Forgery Claim

  1. The CCISO may receive identity theft referrals from IPSU on open innocent spouse claims, that are actually claims of forgery or invalid joint elections by the requesting spouse. These will be worked by the Technical team in the CCISO. See IRM 25.15.7.10.13.5, Forgery.

  2. If applicable, return the Form 14103 Identity theft Assistance Request (ITAR) or Form 14027–B Identity Theft Case Referral indicating that it is an invalid IDT claim and the open innocent spouse claim will be processed under Forgery criteria in the CCISO.

  3. Issue Letter 5064C to the taxpayer within 30 days, stating that "We have determined that you are not a victim of identity theft but we are reviewing your case as a possible forgery" .

  4. Reverse TC 971 AC 522. For input instructions see IRM 10.5.3-13, IMF Only TC 972 AC 522 - Reversal of TC 971 AC 522.


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