4.4.24  Payments and Remittances

Manual Transmittal

July 31, 2014

Purpose

(1) This transmits revised IRM 4.4.24, AIMS Procedures and Processing Instructions, Payments and Remittances.

Material Changes

(1) Minor editorial changes were made throughout the IRM. IRM references were reviewed and updated as necessary.

(2) Retitled IRM 4.4.24.3 to Securing Remittances for Transit.

(3) Retitled IRM 4.4.24.4 to What is an Acceptable Form of Remittance.

(4) Retitled IRM 4.4.24.5 to Remittance Not Payable to United States Treasury.

(5) Retitled IRM 4.4.24.6 to 6603 Deposits (formerly known as Cash Bond).

(6) Retitled IRM 4.4.24.7 to Single Remittance of 50 Million Dollars or More and added processing procedures.

(7) Retitled IRM 4.4.24.8 to Payments of $100,000 or More.

(8) Deleted reference in IRM 4.4.24.8 to Discovered Remittances. The term discovered remittance is no longer applicable for field office Examination employees.

(9) Retitled IRM 4.4.24.9 to Payment Received Prior to Issuance of Notice of Deficiency.

(10) Retitled IRM 4.4.24.10 to Payment Received After Issuance of Notice of Deficiency.

(11) Retitled IRM 4.4.24.11 to Routing Criminal Restitution Payments.

(12) Added IRM 4.4.24.12 Routing Offshore Voluntary Disclosure Program Payments.

(13) Added IRM 4.4.24.13 Voluntary Payments after Statute Expiration.

(14) Added IRM 4.4.24.14 Lost Payment Procedures and Replacement Checks.

Effect on Other Documents

This revision supersedes the previous IRM 4.4.24, Payments and Remittances, issued 10/1/2007.

Audience

Large Business and International (LB&I), Small Business/Self Employed (SB/SE), Wage and Investment (W&I), Appeals and Tax Exempt and Government Entities (TEGE) employees

Effective Date

(07-31-2014)

Signed by Beth Haverly
Program Manager, Business Reengineering, Systems Operations Examination
Small Business/Self-Employed

4.4.24.1  (07-31-2014)
Introduction

  1. This chapter contains information and instructions on payments and remittances.

4.4.24.2  (07-31-2014)
Form 3244-A

  1. When a payment is received by an Examination employee, prepare Form 3244-A, Payment Posting Voucher - Examination,. Complete a separate Form 3244-A for each tax year and class of tax involved. See Exhibit 4.4.24-1 for instructions on the completion of the form. Attach Part 2 of Form 3244-A to the face of the return.

  2. When you receive a tax payment, ensure the "Transaction Received Date" on Form 3244-A reflects the correct date the payment was received. Submission Processing Centers will credit customers for the earliest Official IRS Received Date. If you discover you have made an error in the payment received date after the payment has been processed, request a change in payment dates on Form 2424, Account Adjustment Voucher. Explain the reason for the change in date on the "Explanation" line. E-Fax Form 2424 to your Centralized Case Processing (CCP) office at:

    • Cincinnati - 855-386-5123

    • Memphis - 855-235-6797

    • Ogden - 855-235-8844

  3. Transmit the payment, Form 3244-A and Form 3210, Document Transmittal, to the remittance processor at the address shown on MySBSE website, "Issues and Procedures," "Payment Processing" at: Payment Processing within 24 hours of receipt of the payment.

    Note:

    Be sure to include the amount of the remittance on Form 3210 in addition to including the amount of the remittance on Form 3244-A.

  4. If a remittance must be held overnight, make certain it is stored securely in a locked container.

  5. When a payment is received by an examiner in the field, the 24-hour processing time is still in effect as well as storing the payment in a locked container.

    Note:

    If the taxpayer has not signed an agreement form but has submitted a payment without specifically addressing how to apply the payment, the field examiner will still process the payment within 24 hours. If necessary, the Designated Payment Code (DPC) can be changed at a later date by completing Form 2424 and faxing it to CCP. See Field Collection IRM 5.1.15.15(6) , Abatements, Reconsiderations and Adjustments, Credit Transfers for instructions on completing Form 2424.

  6. LB&I employees see Remittance Processing for LB&I Cases for additional instructions.

4.4.24.3  (07-31-2014)
Securing Remittances for Transit

  1. Internal control of tax receipts and personally identifiable information (PII) to ensure security during transit is required. See IRM 3.8.47.4.3, Manual Deposit Process for Field Office Payment Processing, Securing Remittances for Transit, for the actions to take when sending payments for processing.

4.4.24.4  (07-31-2014)
What is an Acceptable Form of Remittance?

  1. An acceptable remittance is defined as any means of documentation of legal tender and payment. The documentation must contain all valid information shown below to process the payment through the bank:

    1. Payee

    2. Money amount written or numerical

    3. Bank Routing Number

    4. Checking account number

4.4.24.5  (07-31-2014)
Remittance Not Payable to United States Treasury

  1. See IRM 3.10.72.5.5(15), Extraction of Envelope Contents for Returns and Documents with Remittance, for procedures when the remittance is not made payable to the United States Treasury.

4.4.24.6  (07-31-2014)
IRC Section 6603 Deposits (formerly known as Cash Bond)

  1. For a detailed explanation of the enactment of IRC 6603 see IRM 20.2.4.8.2, IRC 6603 Deposits.

  2. IRC Section 6603 deposits can be made using the EFTPS (electronic payment) system, a check, or money order accompanied by a written statement designating the remittance as a IRC 6603 deposit.

4.4.24.6.1  (07-31-2014)
Is The Remittance a Payment of Tax or a IRC Section 6603 Deposit?

  1. When IRS personnel receive a remittance, they must determine whether it's a payment of tax or a IRC 6603 deposit. The determination is made by looking for a written statement from the taxpayer designating the type of remittance. Correspondence can include such statements as:

    1. "Stop Interest"

    2. "Pursuant to IRC 6603"

    3. "Rev. Proc. 2005-18"

  2. If there is no indication the remittance is a IRC 6603 deposit, then the taxpayer is not entitled to IRC 6603(d) interest.

  3. For the remittance to be treated as a IRC 6603 deposit, the taxpayer must:

    1. Include a written statement designating the remittance as a IRC 6603 deposit

    2. Specify the type(s) of tax

    3. Specify the tax year(s)

    4. Include a statement identifying and describing the amount of the disputable tax at the time the deposit is remitted (enclosing the 30-day letter is sufficient)

4.4.24.6.2  (07-31-2014)
Cash Bond Converted toIRC 6603 Deposit

  1. Case file documentation is critical when a taxpayer requests that a previously posted cash bond be "converted" to a IRC 6603 deposit. The date of the taxpayer letter requesting the "conversion" must be reflected in the source documents maintained with the case file. To document the request, date stamp the original letter maintaining it in the case file and provide the taxpayer a copy advising the taxpayer to maintain it for their records. The date on which the Service receives the written statement describing the amount and return of the disputable tax is the date that a converted deposit begins to accrue credit interest if returned to the taxpayer. See IRM section 20.2.4, Overpayment Interest, for additional information.

4.4.24.6.3  (07-31-2014)
IRC 6603 Deposits Received Prior to Issuance of Notice of Deficiency

  1. IRC 6603 deposits received prior to the issuance of a statutory notice of deficiency will be considered a payment of tax upon the expiration of the 90/150 days, unless the taxpayer has petitioned the Tax Court and re-requested the remittance continue to be considered aIRC 6603 deposit.

  2. The manual computation of interest will be necessary any time the final determination results in a refund of any part of a IRC 6603 deposit which was subsequently transferred to a payment of tax.

4.4.24.6.4  (07-31-2014)
Completion of Form 3244-A for IRC 6603 Deposits

  1. The newest revision of Form 3244-A contains a check box on the form to designate a payment as a IRC 6603 deposit. If you are completing the form on the publishing website and check the 6603 box, the form will automatically populate with Designated Payment Code (DPC) 12. If you are hand writing the form, manually enter DPC 12.

  2. Apply as a TC 640 and enter the amount of the remittance.

  3. Submit the payment and Form 3244-A using Form 3210 to the Submission Processing Center designated on MySBSE website, "Issues and Procedures," "Payment Processing" at: Payment Processing.

4.4.24.7  (07-31-2014)
Single Remittance of 50 Million Dollars or More

  1. A single remittance of $50 million or more must be deposited on the day of receipt, when received before your depository's same day credit cutoff time. See IRM 3.8.45.6.29, Manual Deposit Process, Single Remittances of 50 Million Dollars or More, for very specific processing instructions on these remittances.

4.4.24.8  (07-31-2014)
Payments of $100,000 or More

  1. All employees will notify their immediate manager upon receipt of a remittance of $100,000 or more to ensure timely processing.

4.4.24.8.1  (07-31-2014)
Manager’s Responsibility

  1. The immediate manager will determine what extraordinary steps should be taken to ensure timely deposit. All overnight mail delivery services must be traceable. Though not required, it would be beneficial to annotate the envelope containing a payment(s) of $100,000 or more with the word "LARGE." Measures to ensure timely deposit will include, but are not limited to, the following:

    1. Express Mail—to ensure next day delivery. (See IRM 1.22, Mail and Transportation Management Handbook.)

    2. Private Delivery Service within 300 miles; for example United Parcel Service, Purolator, etc.

    3. Private Delivery Service over 300 miles; for example Emory, Airborne, etc.

  2. Determine which of the above is most cost-effective.

    Note:

    The cost of transportation of the remittance should be commensurate with the interest to be gained by expeditious deposit.

  3. If there is a Teller Function (located in the Collection organization) in your immediate post of duty, alert them in advance of the receipt of a remittance of $100,000 or more.

  4. When an area office does not have a Teller Function in their immediate post of duty, payments will be sent to the Submission Processing Center designated on MySBSE website, "Issues and Procedures," "Payment Processing" at: Payment Processing.

4.4.24.9  (07-31-2014)
Payment Received Prior to Issuance of Notice of Deficiency

  1. If payment is received prior to the issuance of a statutory notice of deficiency without a signed waiver or agreement form, look for a statement that this constitutes an advance payment or evidence that the taxpayer intends to file a protest. An advance payment received prior to issuance of a stat notice is considered an agreement in lieu of a signed Form 870, Waiver of Restrictions on Assessment & Collection of Deficiency in Tax & Acceptance of Overassessment, up to the amount of the payment.

    1. If there is no statement that this is an advance payment or that the taxpayer intends to protest, CCP should close the case under agreed closing procedures.

    2. If the taxpayer does state that this is an advance payment or they intend to file a protest, refer the case to Technical Services Staff or the designated Technical Services Manager.

4.4.24.10  (07-31-2014)
Payment Received After Issuance of Notice of Deficiency

  1. Determine if the taxpayer has submitted a full or partial payment of the deficiency by matching the dollar amount of the remittance to the tax deficiency dollar amount shown on the Notice of Deficiency. If the remittance exceeds the tax deficiency amount, check for the taxpayer’s designation of the excess as payment of interest. Also check to see if the taxpayer submitted a full or partial agreement (i.e., signed waiver form), or has requested, in writing, that the remittance be treated as a 6603 Deposit.

  2. If full or partial payment is received, prepare Form 3244-A and Form 3210 and forward payment to your designated Submission Processing Center shown on MySBSE website, "Issues and Procedures," "Payment Processing" at: Payment Processing .

  3. If a remittance is received as a payment of tax with a partial agreement, have a partial assessment done on the amount. Partial assessment procedures are as follows:

    1. Flag these cases with Form 3198, Special Handling Notice for Examination Case Processing as a partial agreement case for identification and processing purposes.

    2. E-Fax copies of the examination report, the agreement, Form 5344, Examination Closing Record, and Form 3198 to your CCP FORT (Field Office Resource Team) unit requesting input of the partial assessment. E-Fax numbers for CCP are:
      Cincinnati - 855-386-5122
      Memphis - 855-235-6795
      Ogden - 855-235-8844.

    3. When the assessment has been completed, verification will be returned to the Technical Services Area by CCP. The case will remain in 90-Day Suspense awaiting either further correspondence, petition, or default.

  4. If a full agreement is received with the payment, close out all 90-Day suspense file controls on the case and send the case file to CCP for closure.

4.4.24.11  (07-31-2014)
Routing Criminal Restitution Payments

  1. On occasion you may receive a payment designated as a "Criminal Restitution" payment.

  2. The IRS has a specific office to collect and process all criminal restitution payments. Complete Form 3244-A using DPC 26 and Form 3210. Send the payment, Form 3244-A and Form 3210 via overnight traceable method to the following address:
    Internal Revenue Service - RACS
    Attn: Mail Stop 6261, Restitution
    333 W. Pershing Ave.
    Kansas City, MO 64108

  3. For additional information, see IRM 5.1.5.24.2, Field Collecting Procedures, Balancing Civil and Criminal Cases, Restitution Payment Processing.

4.4.24.12  (07-31-2014)
Routing Offshore Voluntary Disclosure Program Payments

  1. Complete Form 3244-A using TC 640 and in the "Remarks" section of the form include the comment "Advance payment for Offshore Voluntary Disclosure Case."

  2. Send the payment, Form 3244-A and Form 3210 to the address shown on MySBSE website, "Issues and Procedures" "Payment Processing" at: Payment Processing within 24 hours of receipt of the payment.

4.4.24.13  (07-31-2014)
Voluntary Payments after Assessment Statute Expiration

  1. The subject of voluntary payments should not be discussed unless the taxpayer inquires about voluntary payments. See IRM 4.2.1, General Examining Procedures, General Examination Information. If a taxpayer submits a voluntary payment after the expiration of the ASED, Assessment Statute Expiration Date, follow the instructions below:

    1. Prepare Form 3244-A using TC 640 with DPC 14.

    2. Prepare Form 3210.

    3. Send the payment, Form 3244-A and Form 3210 to your designated Submission Processing Center shown on MySBSE website, "Issues and Procedures" "Payment Processing" at: Payment Processing.

4.4.24.14  (07-31-2014)
Lost Payment Procedures and Replacement Checks

  1. If the Internal Revenue Service has lost a payment made by the taxpayer, follow the directions below:

    1. Request a replacement check from the taxpayer, if applicable.

    2. Do not back date the payment.

    3. Complete Form 3465, Adjustment Request, and attach Form 3465 to the replacement check requesting the interest and penalty be abated.

    4. Complete Form 3244-A.

    5. Complete Form 3210 and attach the replacement check, Form 3465 and Form 3244-A to Form 3210.

    6. Mail the package to the remittance processor at the address shown on MySBSE website, "Issues and Procedures," "Payment Processing" at: Payment Processing.

    Note:

    The Submission Processing office receiving the payment will post the check with the current date.

  2. Checks contain PII . If you suspect or know of a potential PII loss or a confirmed loss of sensitive information, report the discovery of the loss or unauthorized disclosure accordingly:

    1. Notify your manager.

    2. Contact the CSIRC, Computer Security Incident Response Center, at 1-866-216-4809.

    3. Contact TIGTA, Treasury Inspector General for Tax Administration, at 1-800-366-4484 for intentional unauthorized disclosures, losses and thefts. In addition see IRM 10.5.4, Privacy and Information Protection, Incident Management Program, for additional information on reporting incidents.

Exhibit 4.4.24-1 
Preparation of Form 3244–A

Print all information legibly to ensure proper posting.

Enter the taxpayer's SSN or EIN including a file source, if present, e.g., N for NMF, V for Form 706, * for invalid SSN, W for invalid Form 706 TIN, or P for IRA account.

Enter return form number and proper MFT code. (reference Document 6209, IRS Processing Codes and Information)

Enter tax period in YYYYMM format.

Enter IRS received date in MMDDYYYY format.

Enter full name (identify name control) and address of taxpayer whose account is to be credited with the payment.

Enter amount for TC 670 if it is NOT an advance payment being made on an account open to Examination.

Enter amount for TC 640 if it is an Examination or Appeals advance payment. TC 640 is not required to have a DPC if none applies.

Enter amount for TC 680 if the payment or partial payment has been designated for interest.

Enter amount for TC 690 if the payment or partial payment has been designated for penalties.

Leave the amount field blank for TC 570 when TC 670 is used to process the payment.

6603 Deposit - check the box for "6603" if applicable. DPC 12 will automatically populate if you are using the form on the publishing website. Otherwise enter DPC 12 if hand writing the form.

Prepared By - enter the Primary Business Code, Secondary Business Code and Group number along with the preparer's name and telephone number (including area code) so that the preparer of the form may be contacted if necessary.

Remarks - indicate any pertinent information regarding the transaction, such as: the amount of payment allocated to tax and interest, as well as any special instructions; when the date of an agreement precedes the date of the advance payment by more than 30 days, enter the agreement date; if the first payment is not for the full amount of the deficiency, enter "Part Payment" or if part payment is other than the first payment, designate the payment, e.g., "2nd payment" and note restricted interest cases identified on Form 3198, Special Handling Notice for Examination Case Processing.


More Internal Revenue Manual