5.4.11  CCP Installment Agreements

Manual Transmittal

December 09, 2014

Purpose

(1) This transmits a topic based revision to IRM 5.4.11, Case Processing, CCP Installment Agreements to incorporate procedural changes based on ACA Provision 1501.

Material Changes

(1) This IRM has only been updated for the Affordable Care Act (ACA) Provision 1501: Requirement to Maintain Minimum Essential Coverage (Individual Shared Responsibility) (IRC § 5000A), as identified below. Content unrelated to the ACA provisions was not reviewed for currency or accuracy.

  • IRM 5.4.11.1.1(2) i) Update to incorporate Shared Responsibility Payment (SRP ) balances as eligible for Installment Agreement consideration.

  • IRM 5.4.11.1.1(3) Update to incorporate Shared Responsibility as eligible for the provision of a mirrored option.

  • IRM 5.4.11.2(8) Update provides for adding SRP modules to existing installment agreements.

  • IRM 5.4.11.2(9) Update provides updates for transmitting mirrored SRP balances to CCP.

  • IRM 5.4.11.3.1(2) k) Update provides for including MFT 35 balances in existing installment agreements.

  • IRM 5.4.11.4(2) 8) This update allows for provision of recessing SRP balances (TC 530 cc35).

  • IRM 5.4.11.6(4) This provision allows that SRP balances will not cause an installment agreement to default.

Effect on Other Documents

This IRM supersedes IRM 5.4.11, dated April 17, 2013.

Audience

The target audience is tax examining technicians in SB/SE Collections Centralized Case Processing at the Philadelphia Campus.

Effective Date

(01-01-2015)

Cheryl Cordero
Director, Filing & Payment Compliance
Small Business/Self-Employed

5.4.11.1  (04-17-2013)
Overview

  1. Installment Agreements (IA) are arrangements whereby the Internal Revenue Service allows taxpayers to pay liabilities over time. If full payment cannot be achieved by the Collection Statute Expiration Date (CSED), and taxpayers have some ability to pay, Partial Payment Installment Agreements (PPIA) may be granted. During the course of agreements, penalty and interest continue to accrue. Generally, no levies may be served during installment agreements.

  2. The Integrated Data Retrieval System (IDRS) is used to monitor most IAs for timely payments on accounts, as well as to determine whether taxpayers remain in compliance with current filing and paying requirements. IDRS also monitors agreements based on the Installment Agreement Locator Number (ALN) recorded at the time agreements are input. See IRM 5.14.1–2,Installment Agreement Locator Numbers. Some agreements require special monitoring, such as when accounts reside on Non-Masterfile (NMF) or if payment amounts are varied. These accounts must be manually monitored.

  3. This chapter provides procedures for processing all types of IA's received in Centralized Case Processing (CCP), including manually monitored installment agreements (MMIA), and In-Business Trust Fund (IBTF) balance dues. Many of these accounts involve in-business payroll tax accounts, and/or large dollar accounts. See IRM 5.14.7, BMF Installment Agreements.

5.4.11.1.1  (01-01-2015)
Types of Installment Agreements

  1. When taxpayers are unable to pay a liability in full, an IA will be considered.

  2. There are various types of installment agreements that may be granted to taxpayers:

    1. Guaranteed Installment Agreement – Taxpayers with Individual income tax liabilities of $10,000 or less (exclusive of penalties and interest); See IRM 5.14.5.3, Guaranteed Installment Agreements.

    2. Streamlined Installment Agreements – Taxpayers with liabilities of $50,000 or less; See IRM 5.14.5.2, Streamlined Installment Agreements.

    3. In-Business Trust Fund Express Installment Agreements; See IRM 5.14.5.4, In-Business Trust Fund Express Installment Agreements.

    4. Manually Monitored Installment Agreements (MMIA); See IRM 5.14.9.5, Manually Monitored Installment Agreements, including MMIA In Business Trust Fund (IBTF) agreements; See IRM 5.14.7.4, In-Business Trust Fund Installment Agreements Requiring Financial Analysis and Determining Ability to Pay.

    5. Partial Payment Installment Agreements (PPIA), which can be systemically or manually monitored; See IRM 5.14.2, Partial Payment Installment Agreements and the Collection Statute Expiration Date.

    6. Direct Debit Installment Agreements; See IRM 5.14.10.4, Direct Debit Installment Agreements.

    7. Payroll Deduction Installment Agreements; See IRM 5.14.10.2, Payroll Deduction Installment Agreements.

    8. Installment agreements involving Limited Liability Companies (LLC); See IRM 5.14.7.3, Installment Agreements Involving Limited Liability Companies.

    9. Affordable Care Act (ACA) individual Shared Responsibility Payment (SRP) A standalone SRP occurs when a balance due is created on an module with MFT 35 File Source 1 (SRP 5000A) and there is no other Balance Due module with a different MFT in Status 22, 24, or 26, nor a TDI module in status 03. If an additional SRP balance due occurs in a subsequent year, and still no other modules with a different MFT, it is (they are) still considered a standalone SRP.

  3. SRP Manually Monitored Installment Agreements: If the taxpayer has requested an account to be split due to a divorce or innocent spouse, current procedures do not allow for mirroring the assessment until 2016. The case will be sent to Manually Monitored (MMIA). SRP cases can be maintained in MMIA Philadelphia until they can be mirrored. As with all agreements, the taxpayer must have filed all tax returns that are due prior to entering into the agreement

5.4.11.2  (01-01-2015)
Processing Guaranteed, Streamline and In-Business Express Installment Agreements

  1. IA requests will be received, by mail or electronic submission, in CCP for input from the Field Collection (FC) on a Form 433D, Installment Agreement, or Form 2159, Payroll Deduction Agreement.

  2. Cases must be controlled within five (5) business days.

  3. CCP has 21 business days from the CCP receive date to input the IA.

  4. Verify the information on the Form 433D:

    1. Taxpayer name

    2. Taxpayer Identification Number (TIN)

    3. Secondary or cross reference TIN

    4. Taxpayer address

    5. Taxpayer telephone number(s)

    6. Levy source(s)

    7. Agreement Locator Number (ALN)

    Note:

    If the IA was submitted is a routine IA/IBTF Express and it should have been submitted as an Manually Monitored -IA, reject the IA to the originator. See IRM 5.14.9.5, Manually Monitored Installment Agreement, including MMIA In Business Trust Fund (IBTF) agreements. See IRM 5.14.7.4, In-Business Trust Fund Installment Agreements Requiring Financial Analysis and Determining Ability to Pay

  5. Check IDRS before submitting an IA for processing; including compliance and case assignments.

    Note:

    Accounts containing freeze codes -O, -Z, -J, L-, -Y, -W and -V will be rejected to the originator without contact. If there is a W- freeze caused by a TC 470 on the module, input a TC 472 on accounts with a W- freeze and continue processing. These accounts and accounts containing MFREQ modules will be suspended for two-weeks to allow IDRS posting.

  6. If information is missing and or incomplete, or conditions exist to prevent a case from going into ST 60, check IDRS and or Integrated Collection System (ICS) for updated information. Attempt to contact the originator. If unable to obtain necessary information for input within 48 hours, notify the originator of the rejected Form 433D by E-mail with a CC to the Group Manager. Input an ICS history and close control base.

    Note:

    History entries must contain enough information so that any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve issues.

  7. See Exhibit 1-6 in IRM 5.19IDRS input of Installment Agreements.

  8. All open Individual Shared Responsibility Payment (SRP) modules should be added to the original installment agreement. However, if the taxpayer wants to add a subsequent MFT 35 to an existing agreement and it no longer meets Streamlined IA criteria, the employee should ask for a financial statement:

    • If they do not respond, the existing IA will stay in place and stand alone MFT 35 will be recessed. Agreement will not default PDIA - A new F2159 Is NOT needed/required to add a new liability to an existing PDIA. A PDIA may be updated to include the Individual SRP liability by issuing a Letter 2571C to the employer informing them of the new balance .

    • If the taxpayer chooses to send in a new Form 2159 with the new period, we will accept/process it but it is NOT required Streamlined PDIA Agreements - All open Individual SRP modules should be added to the original installment agreement.

    • However, if the taxpayer wants to add a subsequent MFT 35 to an existing agreement and it no longer meets Streamlined IA criteria, the employee should ask for a financial statement.

    • If the IA is a DDIA, the taxpayer must provide a new signed Form 9465 or Form 433-D to include the MFT in the agreement, if they are increasing the payment amount.

  9. SRP Mirrored Installment Agreements: Current procedures do not allow for mirroring the assessment until 2016. The case will be sent to Manually Monitored Installment Agreements (MMIA), currently in Philadelphia until the time when the assessment can be split. SRP cases can be maintained in MMIA Philadelphia until they can be mirrored. As with all agreements, the taxpayer must have filed all tax returns that are due prior to entering into the agreement.

5.4.11.3  (04-17-2013)
Receipt of Manually Monitored Installment Agreements (MMIA) and In-Business Trust Fund Installment Agreements (IBTF-IA)

  1. CCP receives MMIA and IBTF cases as a Non-Field Other Investigation (NF-OI) based on ICS case closure from Field Collection (FC).

  2. If an IBTF agreement is received that meets IBTF express agreement criteria, See IRM 5.14.5.4Streamline, Guaranteed and In-Business Trust Fund Express Installment Agreements, reject the case back to the originator to be submitted as an IBTF express agreement.

  3. MMIA cases can be received from other functions; Automated Collection System (ACS), Field Assistance, and Collection Service Center Operation (CSCO). These cases will be received on a Form 433D, Installment Agreement, and cannot be mirrored. Create a case on ICS, if not established.

    Note:

    Create the case on ICS using the appropriate taxpayer identification number (TIN) based on the earliest collection statute expiration date (CSED), with the name of the taxpayer for whom the IA is being granted. Include only balance due modules in the IA for the appropriate TIN. Establish separate addresses if necessary.

  4. Control cases to tax examiners within 10 business days.

    Note:

    Cases received from functions other than CFf will be assigned to tax examiners within 10 business days from receipt of the Form 433D, Installment Agreement.

5.4.11.3.1  (01-01-2015)
Initial Analysis of MMIA - IBTF - PPIA Cases

  1. Initial analysis will be completed within 21 business days from the employee assignment date. Annotate ICS/AMS case history of all actions taken.

    Note:

    History entries will contain enough information so any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve an issue.

  2. Verify the information on the Form 433D, Installment Agreement, to include:

    1. Taxpayer name

      Note:

      Single Member Owner (SMO)/ Limited Liability Company (LLC) In Business Trust Fund (IBTF) agreements will include both the name of the LLC and the name of the SMO.

    2. Taxpayer Identification Number (TIN)

    3. Secondary or cross-reference TIN

    4. Taxpayer address

    5. Taxpayer telephone number(s)

    6. Verify terms of agreement

    7. Levy source(s)

    8. Area designation

    9. Business unit designation

    10. Group Manager approval (check ICS history and/or Form 433D, Installment Agreement, for GM approval and terms) on cases received from the field.

      Note:

      If GM approval is not on ICS, wait for paper case file before inputting IA. Document ICS history and set a 14 day follow-up date. If proof of GM approval is not received, reject case to originator.

    11. New Installment Agreements mustinclude all open modules,including SRP, MFT 35: Existing DDIA’s /PDIA’s IAs will have to be revised to include the MFT 35 for the agreement to be valid.

  3. Verify on ICS the following information:

    1. Case Sub-code is 900 (IBTF-IA), 901 (MMIA), 911 (routine PPIA), 906 SMO/LLC IBTF-IA, or 907 SMO/LLC MMIA, 929-Non Field MMIA/Non-IAT, 927-Non Field MMIA/IAT, or 931 for Field Non-IAT cases (unable to be monitored by Integrated Automation Technologies (IAT).

    2. Location Code is SX-Y, or SX-N (CCP use only). The literal X is, B for IBTF, M for MMIA, and P for PPIA cases.

    3. Status code on IDRS (ST 26 for MMIA or ST 60 for IBTF-IA).

    4. CSED and ASED dates; See IRM 5.14.2.2, Collection Statute Expiration Date: Law, Policy and Procedures, and IRM 5.14.7.4.2., Approval and Monitoring

    5. Terms of the IA.

      Note:

      Requests for back-up 53's require a completed Form 53, Report of Currently Not Collectible Taxes, signed by the group manager.

    6. Verify waivers are input to IDRS (Form 2750-ASED, Waiver Extending Statutory Period for Assessments of Trust Fund Recovery Penalty, Form 900-CSED, Tax Collection Waiver, or Form 8620-INTL, Statute Extension IRC 6503(c)).

    7. On all In Business Trust Fund (IBTF) cases received for monitoring, the ASED must be protected if the IA will not full pay all liabilities at least one-year prior to the earliest ASED. The file must include a Form 2750, Waiver Extending Statutory Period for Assessment of Trust Fund Recovery Penalty, which includes all modules on the IA and the completed TFRP file. A TC 971 AC 330 must be present on each module included on the Form 2750, Waiver Extending Statutory Period for Assessments of Trust Fund Recovery Penalty, If the TC 971 AC 330 is not present on any module complete the input.; or a Form 9327, Non-Assertion Recommendation of Uncollectible Trust Fund Recovery Penalty or of Uncollectible Personal Liability for Excise Tax, and a three (3) has been updated in IDRS on ASEDR. If the appropriate action to protect the ASED, has not been completed and the account is in ST 60, issue an OI to the originator's group manager using the parameter tables. Input "All appropriate actions to protect the ASED have not been completed. Please complete the TF investigation or protect the ASED." Set a 45 day follow-up to check the status of the investigation. If unresolved after the 45 day follow-up expires, elevate to your manager.

      Note:

      Set a follow-up date if a cross-reference TIN needs to be included in the IA after a TFRP assessment posts.

    8. Lien determination has been made by the Revenue Officer (RO). If no lien determination has been made by the RO, prepare a FORT referral.

    9. Input of TC 971 AC 063, if not previously input.

      Note:

      If the case is for manually monitoring a continuous levy, do not input a TC 971 AC 063 on balance due accounts included on the continuous wage levy.

      Note:

      Verify SMO/LLC IBTF IA's are truly a SMO/LLC IBTF IA. If SMO/LLC IBTF IA's contain both pre and post 01/01/2009 assessments, see IRM 5.14.7.3.2, Installment Agreements When Owner (SMO) and LLC are Liable for Assessments in LLC Name, TC 971 AC 364/365/366 must be present on each module included in the IA. These codes identify the liable taxpayer for each period. See IRM 5.1.21.8.3, Identity of the Taxpayer on Integrated Data Retrieval System (IDRS). Input the appropriate TC 971 if it is not present. Check IDRS to see if all pre 01/01/2009 modules have a TC 971 AC 365 with a x-ref TIN (can be a SSN or EIN). If no TC 971 AC 365 is present, locate the x-ref TIN on ICS/IDRS and input the TC 971 AC 365. On ICS, look at the Name/Address Record. Look for a "J" or "K" address. The x-ref TIN should be available by viewing the address record. If you are unable to locate an x-ref TIN for the SMO, contact the RO by phone or E-mail. If unable to make contact with the RO, issue an OI to the field telling them to request the input of a TC 971 AC 365 with a x-ref TIN for the SMO on the pre 01/01/2009 modules.

    10. On MMIA cases verify the User Fee was applied and posted correctly. See IRM 5.19.1.5.5.5, Installment Agreement Payment Method and User Fees (UF) Overview, for establishing user fee modules, if not posted.

      Note:

      No user fee is deducted from continuous levy cases.

    11. Compliance Issues (open delinquent returns (Del Rets) and/or balances due (Bal Due) not included in the IA), See IRM 5.14.1.4.1, Compliance and Installment Agreements.

    12. If an IA has been systemically uploaded and there are delinquent returns follow 6020b processing procedures, IRM 5.4.11.5.3, IBTF-IAT Monitoring Procedures.

    13. If an IA has been systemically uploaded (status (ST) 60) and the account has balance dues that were not included in the IA, open an Other Investigation (OI) request to the RO for the information needed to revise the IA. For example, balance due modules should be added to the IA. If the RO fails to respond to the OI, close the OI and document the history. If the RO fails to respond timely and the IA defaults (i.e. additional modules) allow the IA to systemically default.

    14. Verify Federal Tax Deposit (FTD) requirements are addressed.

    15. An open NF-OI on ICS for monitoring the case.

      Note:

      An NF-OI is not needed on MMIA cases.

  4. Input a TC 130, on sole proprietor cases, if not previously input.

  5. For SMO/LLC agreements, input a history on ENMOD stating the case is a SMO/LLC IBTF-IA with the total IA payment amount and individual payment liability of the SMO and LLC.

  6. Complete appropriate checklist for MMIA cases received from other functions, ACS, field assistance and CSCO.

  7. MFREQ modules included in the IA, but not on IDRS, and modules where a TC 470 reversal was input, set a follow-up date for two cycles and TSIGN IDRS, except MMIA cases.

    Note:

    Pre-assessed modules require a follow-up date to reverse the pre-assessed indicator.

  8. If the case is closed incorrectly, cannot be monitored or is missing information and not in ST 60, reject the case. See IRM 5.4.11.3.2, Returning Cases to Collection Field Function.

  9. If the case is closed as an IBTF, and is in ST 60:

    1. transfer the OI to the PPIA team if the case should be a PPIA.

    2. If the case should be an MMIA, default the IA and suppress the default notice, input CC STAUP 2200, change the sub code to 901 and transfer the case to the MMIA team. The MMIA team will close the OI when all modules are in ST 26.

  10. If the case is closed as a routine/DDIA PPIA, is in ST 60, and the taxpayer is:

    1. in business and the account will be full paid within the CSED, close PPIA OI and transfer to the IBTF group.

    2. out of business and the account will be full paid within the CSED close PPIA OI.

    3. in business , and the account will NOT be full paid within the CSED, change the sub code to 900, open an IBTF OI, update IDRS TSIGN.

  11. Cases meeting "mirroring" criteria below must be forwarded to CSCO.

    • IA established with secondary taxpayer.

    • Primary taxpayer is currently not collectable, unable to locate, etc. (ST 53), deceased, in notice status, ST 26 or paying under separate IA.

    Note:

    If the name control is not the same as INOLE, or the TIN assigned to either entity is temporary, or contains international entities, the case cannot be mirrored and must be manually monitored.

  12. See Exhibit 1-6 in IRM 5.19, Liability Collection, for IDRS input of IAs that were not systemically uploaded..

    Note:

    Direct Debit Installment Agreements (DDIA) will be input by CSCO PSC. Wait 60 days from the Group Manager (GM) approval date for the DDIA unit to input the IA. If CCP determines a DDIA case needs to be rejected back to the originator, input the following in the AMS history: "This DDIA is being rejected back to the originating RO. DO NOT update the case to ST 60." See IRM 5.4.11.3.2, Returning Cases to Collection Field Function. If AMS indicates CSCO rejected the DDIA, reject the case back to the originator immediately. See IRM 5.4.11.3.2, Returning Cases to Collection Field Function.

  13. Verify the correct ALN. See IRM 5.14.1-2, Installment Agreement Locator Numbers.

  14. When inputting a PPIA agreement, use Review Suppress Indicator (RSI) five (5) for IMF and RSI six (6) for BMF with a review cycle 2 years from the IA acceptance date. Form 900, Tax Collection Waiver, may accompany PPIA agreements. Ensure the extension dates are the same on the Form 900 and IDRS. File the Form 900 in accessible files in CCP for 3 years beyond the dates to which the CSEDs were extended. Waivers must be available for research and accountability.

  15. The tax examiner will compute balances for each tax period included in the IA to the due date of the next payment. This amount will be used to complete and mail Letter 3856, Monthly Reminder for Installment Agreement Payment, or Letter 3856A, Monthly Reminder for Installment Agreement Payment for Joint Liabilities. Include a pre-addressed envelope with the MMIA Lockbox address to the taxpayer for the next payment on MMIA cases. Do not include any cross-reference balance dues on the letter. Reminder notices for IBTF cases are sent systemically through IDRS.

    Note:

    A Letter 3856 will not be sent on continuous wage levies.

  16. Cases not meeting systemic IAT criteria, see below, will require monthly manual monitoring with a scheduled follow-up date, seven (7) days after the payment due date.

    • IAs where the taxpayer makes payments a few times a year or at different intervals.

    • Irregular payment amounts.

    • Payroll Deduction cases.

    • Spouse(s) with multiple SSN's.

      Example:

      Taxpayer has filed jointly with different spouses.

    • Invalid SSN's.

    • Non-Masterfile assessments (NMF).

    • IBTF agreement which include MFT 74 & 76 modules.

      Note:

      If an IA request is received from an RO that includes a module(s) with MFT 74 or 76, DO NOT REJECT the IA. The IA should be input excluding the MFT 74 and/or MFT 76 modules. Monitor the IA per IRM 5.4.11. 4, Monitoring MMIA and IBTF Installment Agreements. Ensure the correct type of IA (IBTF, Routine, etc.) is selected.

    • SMO/LLC agreements.

  17. If a case meets IAT monitoring requirements, provide the IAT administrator with the following information and document ICS case history "IAT monitoring, No monitoring histories, follow-up dates of reviews will not be documented unless necessary." :

    1. TIN of IA account and any cross reference TINs.

    2. Terms of agreement, including payment amount , due date and any future changes.

    3. Employee assignment number, name and phone number.

    Note:

    On MMIA cases correct invalid ENMOD histories before submitting information to IAT administrator.

  18. Input a follow-up date on ICS and case history if case cannot be monitored by IAT and requires manual monitoring.

5.4.11.3.2  (04-17-2013)
Returning Cases to Collection Field Function

  1. CCP will return a case back to the RO in the following instances:

    1. If a case is received for manually monitoring and there are no reasons preventing the input of ST 60, or full compliance has not been addressed by the RO, CCP will annotate the ICS case history with the reasons for the return of the IA, and transfer the case back to the originating RO through ICS. CCP must also ensure that the TC 030 has posted before transferring the case to the RO on ICS. Return the paper case file back to the originator.

      Note:

      IAs received from the field should include all balance due modules. CCP will reject IA's back to the originator if the agreement does not include all balance due modules. When rejecting the case reference IRM 5.14.1.4.1(2), Compliance and Installment Agreements, and document ICS with the reason for rejection. The exceptions to this IRM requirement are IAs listed in IRM 5.14.7.3.2, Installment Agreements when Owner (SMO) and LLC are Liable for Assessments in the LLC Name. CWL's are not IAs and the IA request may not include accounts in ST 53 and systemically uploaded IA's.

    2. If a case is received as an In-Business Trust Fund Installment Agreement (IBTF-IA) for monitoring and there are reasons preventing the input of ST 60 such as, open delinquent returns, ASED issues and/or balance dues that have not been addressed by the RO, CCP will annotate the ICS case history with the reasons for the return of the IA. Monitor for posting of the TC 030. After the TC 030 is posted send a secured E-mail to IQA to "re-open" the IA. After the IQA performs the Undo IA (TC 972), CCP will close all OI follow-ups on ICS and close the NF-OI. Transfer balance dues to the originator. Return the paper case file to the originating RO.

    3. If CCP receives a case for monitoring that is erroneously closed as a MMIA and the case should be a IBTF-IA, CCP will annotate the ICS case history with reason(s) how case was determined as IBTF-IA rather than a MMIA. DO NOT input into ST 60 on IDRS. Wait until the TC 030 has posted on IDRS before transferring the case back to the originating RO for proper IBTF-IA closure to generate the NF-OI for monitoring. The paper case file will not be returned to the RO.

      Note:

      The "undo" process should be followed for all IAs rejected back to the originator.

  2. Return sub code to the original case sub code (national) or 000.

5.4.11.3.3  (04-17-2013)
Inventory Management

  1. Check for ICS notifications daily and take appropriate action:

    1. Newly assigned cases or reassigned cases

    2. Expired follow-up dates

    3. Re-opened cases

    4. New histories on a case file

  2. Delete unnecessary ICS notifications.

  3. Provide any necessary information to the IAT administrator. IRM 5.4.11.3.1, Initial Analysis of MMIA - IBTF - PPIA Cases.

  4. Use all available generated reports to monitor inventory and ensure case has the appropriate TSIGN.

  5. Annotate ICS/AMS case history, with all actions taken.

    Note:

    History entries will contain enough information so any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve issues.

5.4.11.4  (01-01-2015)
Monitoring MMIA and IBTF Installment Agreements

  1. Manually Monitored Installment Agreements (MMIA) and In-Business Trust Fund Installment Agreements (IBTF) will be monitored for payment and compliance by CCP every thirty days, either manually or by IAT (Integrated Automation Technology).

    Note:

    Use ANMF to obtain information for Non-Masterfile accounts.

  2. To monitor accounts manually:

    1. Verify payment was made and posted as required in the terms of the IA.

      Note:

      SMO/LLC agreements may require payments to be split and applied to the individual payment liability of the SMO and LLC as directed in the agreement.

    2. If payment is missed and a skip has been used, follow default procedures. IRM 5.4.11.7, Default and Termination Procedures.

    3. If account is full paid, input history to ICS/AMS, close case (NF-OI), and send Letter 4222, Field Collection Case Resolution, via ICS to the taxpayer and send case file to Closed Case function, if applicable.

      Note:

      If MMIA, and spouse portion is full paid, and a continuous wage levy is on the primary TIN, put account into ST 60 using ALN 0208 and TSIGN the case to Area Office (AO000000).

    4. Verify user fee has been paid. See IRM 5.19.1.5.5.5, Installment Agreement Payment Methods and User Fees Overview.

    5. If case conditions have changed and the account can be monitored by IDRS or IAT, follow procedures for IDRS monitoring. IRM 5.4.11.2, Processing Guaranteed, Streamline and In-Business Express Installment Agreements, or IAT monitoring, IRM 5.4.11.3.1, Initial Analysis of MMIA - IBTF - PPIA Cases. If the case can be monitored by IDRS close case (NF-OI).

      Note:

      If IBTF taxpayer is out of business, TFRP has been addressed, and taxpayer is in compliance with all terms of the agreement, close appropriate filing requirements, change the ALN to 0209 or 0212 for PPIA's and close the case to allow systemic monitoring.

    6. Verify account for compliance, using BMFOL/IMFOL on IDRS.

      Note:

      If an open del ret on BMFOL/IMFOL is greater than 16 months from the date the case was closed by FC and the module is not on SUMRY, the taxpayer is in compliance.

    7. If an account has a new balance due and taxpayer has not responded within 45 days of the balance due notice, follow default procedures. IRM 5.4.11.7, Default and Termination Procedures for MMIA/IBTF.

    8. If the taxpayer has an existing/agreed IA (status or ST 60 - existing IA) the SRP is considered a standalone that can be included in the IA and will not default the IA. If the taxpayer does not want the SRP added to the existing IA, then the SRP will be moved to recess (TC530 cc 35). This will take place at the campus and the case will not be assigned to ACS or Field Collection. The case will be subject to refund offset if the taxpayer does not request to have the MFT 35 included in the Installment Agreement. A subsequent MFT 35 WOULD NOT cause a default on existing installment agreements

    9. If account has an open TDI (ST 02 or 03) and it has been 10 weeks since the TDI notice was issued to the taxpayer, initiate 6020b processing for BMF returns. See IRM 5.4.10.5, IRC 6020(b). Prepare a FORT referral for Form 1120, U.S. Corporation Income Tax Return, and IMF returns. Continue monitoring account.

    10. The tax examiner will compute balance dues for each tax period included in the IA to the due date of the next payment. This amount will be used to complete and mail Letter 3856, Monthly Reminder for Installment Agreement Payment, or Letter 3856A, Monthly Reminder for Installment Agreement Payment for Joint Liabilities. Include a pre-addressed envelope with the MMIA Lockbox address to the taxpayer for the next payment on MMIA cases. Reminder notices for IBTF cases are sent systemically through IDRS.

      Note:

      A Letter 3856 will not be sent on continuous levies, Payroll Deduction Installment Agreements (PDIA), and cases with a -O freeze (disaster cases).

      Note:

      If a Letter 3856 is returned as undeliverable, update ICS/AMS case history.

    11. For PPIAs where the statute has expired on the last module, notify the taxpayer that payment should no longer be sent. Review the account to confirm the CSED is expiring on the final module of the PPIA. Send Letter 4222 via ICS, informing the taxpayer the CSED is about to expire, and they are not required to make payments, but they may make voluntary payments.

    12. If Appeals is conducting an investigation and or hearing on an unrelated issue, CCP will hold the case until Appeals makes a determination regarding an appeal of the installment agreement termination. See IRM 5.14.11.7, Appeals of Defaulted and Terminated Agreements.

    13. Annotate ICS/AMS case history of all action taken.

    14. Schedule a follow-up date on ICS seven (7) calendar days after the payment due date.

      Note:

      If resolution cannot be completed within CCP, forward the case to the appropriate FC group pursuant to the zip code and grade level of the case listed in the parameter tables located in ICS. If there is currently an OI assigned to FC, transfer the case to the proper employee.

5.4.11.4.1  (04-17-2013)
Monitoring Continuous Wage Levies

  1. Continuous Wage Levies are not installment agreements. Continuous Wage Levies will be monitored for payment and compliance by CCP. Some Continuous Wage Levies are monitored in ST 60 on IDRS. See IRM 5.11.5.6.2, Systemic Monitoring of Continuous Levy Payments.

    Note:

    Federal Payment Levy Program (FPLP) levies are not eligible to be closed as Continuous Wage Levies (CWL). See IRM 5.11.5.6.3, Manual Monitoring of Continuous Levy Payments. FPLP cases can be identified with a FPLP-3 indicator on the ICS Balance Due Module Summary screen or an unreversed TC 971 AC 060 on IDRS. See IRM 5.11.7.2.3, FPLP Systemic Processes and Indicators.

  2. For initial CWL cases, research and document ICS for the following:

    1. Reasons for manual monitoring

    2. Levy Sources and terms

      Note:

      Add levy source to IDRS using command code LEVY(X) and ICS if not present.

    3. Last payments received

    4. TC 971 AC 063 is present

      Note:

      If TC 971 AC 063 is present on any modules for monitoring use CC REQ77 and the input the reversal TC 972 AC 063 using the date of the original TC 971.

    5. Lien indicators on IDRS. If not present contact the originator.

    6. CSED extensions (TC 300, 186 etc.) on each module and note in ICS history.

    7. Input follow-up based on the terms of the agreement at a minimum of 30 days after the payment due date.

      Note:

      If the terms of the agreement indicate irregular payments will be made, set the follow-up for 30 days. If no payments are received after 90 days, see IRM 5.4.11.4.1(4), Monitoring MMIA and IBTF Installment Agreements.

  3. Verify payment was made and posted as required in the terms of the levy.

  4. If payment is missed, follow up with the payer.

    Note:

    If subsequent payments have been received, continue monitoring the case. Set the next follow-up based on the terms of the levy.

  5. If the reason for non-payment was temporary, secure the date payments will resume and set a follow-up for seven business days from the date provided.

  6. If the payment stopped for any reasons listed below:

    1. taxpayer is no longer employed,

    2. taxpayer is no longer affiliated with payer,

    3. taxpayer is no longer entitled to payments, or

    4. payer refuses to send payments

    Return case to field for further collection activity or determination. If the CSED will expire in less than eight months see IRM 5.1.8.1.2, Additional Criteria for Transfer of Domestic Accounts, and set a 14 day follow-up.

    Note:

    When contacted by a taxpayer/authorized representative claiming hardship due to a CWL assigned to CCP, advise the taxpayer/authorized representative to contact the originating RO and be prepared to provide financial information. Leave an ICS history and continue to monitor the CWL. If the taxpayers asks to be referred to the Taxpayer Advocate Service (TAS), or the taxpayer meets TAS criteria and the taxpayer's issue cannot be resolved the "same day " (within 24 hours), complete Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), and refer the taxpayer to TAS. See IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria, for more information. If you are able to resolve and close the TAS issue on the same day as the TAS contact, do not refer the inquiry to TAS.

  7. If CCP processing cannot resolve issues on these cases, transfer to the field for follow-up action. Document the reason for the transfer in the ICS history.

  8. Determine if the continuous wage levy can be monitored by IDRS. Levies that result in regular remittances, may be monitored systemically if the earliest CSED is further than 18 months into the future. If the account can be monitored systemically, put account into ST 60 using ALN 0208 with terms including the name, address and telephone number of the payer office, suppress reminder notice and TSIGN the case to Area Office (AO000000). Input ICS/AMS case history of actions taken and close case. See IRM 5.11.5.6.2, Systemic Monitoring of Continuous Levy Payment.

    Note:

    FPLP CWL's may not be systemically monitored. See IRM 5.19.9.3.5.1, FPLP Levy vs ACS Paper Levy

  9. The following actions must be taken when monitoring CSEDs:

    1. If one or more CSEDs expire, but the remaining balance due periods included on the levy are within the statutory period for collection, do not release the levy.

    2. Monitor levy payments until all balance due periods included on levies are paid or the last CSED is about to expire (whichever is first).

    3. If some balance due periods are fully paid, or the CSEDs expired and, as a result, the case now qualifies for systemic monitoring, follow the procedures in (4) above, See IRM 5.11.5.6.2, Systemic Monitoring of Continuous Levy Payments. Input ICS history indicating "The following period(s) have expired CSED(s)" then list the appropriate balance due periods.

    4. For wage levies that will be released when the CSED expires, input a TC 971, AC 687, misc. 002 for each module included in the continuous wage levy.

    5. For other continuous levies that reach a taxpayer's right to future payment and will not be released when the CSED expires, input a TC 971, AC 687, misc. 001 for each module included in the continuous levy.

      Note:

      If the levy form is available, record this information on the levy. Ensure it includes a list of the tax periods that have expired CSED(s).

  10. Verify account for compliance using BMFOL/IMFOL on IDRS.

    Note:

    If open on BMFOL/IMFOL is greater than 16 months from the date the case was closed by FC and the module is not on SUMRY, the taxpayer is in compliance.

  11. If account has a new balance due, prepare a FORT referral. Schedule a follow-up date on ICS for 75 calendar days from the date the case is referred to the FORT.

  12. If the account has an open TDI (ST 02 or 03), initiate 6020b processing for Form 940, Employer's Annual Federal Unemployment Tax Return, and Form 941, Employer's Quarterly Federal Tax Return, returns. See IRM 5.4.10.5, IRC 6020(b). Prepare a FORT referral for all other BMF and IMF returns.

  13. If the account will be paid in full within six (6) weeks prepare a notice of levy release. The notice of levy release must be sent to the payer 30 days prior to the account being full paid, advising the payor of the amount required to satisfy the levy. A Form 668-D, Release of Levy/Release of Property from Levy, will not be issued until:

    1. all liabilities are full paid.

    2. the last CSED is about to expire, so the wage levy is released far enough in advance that no payments are received after the expiration of the CSED.

    3. one of the criteria in IRM 5.11.2.2, Releasing Levies, exists.

5.4.11.5  (04-17-2013)
Installment Agreements Monitored by Integrated Automation Technologies (IAT)

  1. The IAT (formerly known as IDRS Decision Assisting Program (IDAP)), systemically monitors Manually-Monitored Installment Agreements (MMIA), In-Business Trust Fund Installment Agreements (IBTF) and Partial Payment Installment Agreements (PPIA) for payments and compliance.

  2. Cases not meeting systemic parameters of the IAT monitoring process will be generated on a Manual Action List (MAL).

  3. IAT administrators update and/or make changes to cases monitored by IAT.

  4. IAT generates monthly reminder notices (Letter 3856, Monthly Reminder for Installment Agreement Payment), and notice of default (Letter 2975, Notice of Intent to Levy under IRC section 6221(d)) on manually monitored IAs not included on the Manual Action List.

5.4.11.5.1  (04-17-2013)
IAT Administrator Responsibilities

  1. The IAT Administrator runs the MMIA/IBTF-IA batch process daily. Batch reports include:

    1. Manual Action List

    2. Information Only List

    3. Prints of IDRS letters; Letter 2975 Notice of Intent to Levy under IRC section 6221(d) and Letter 3856, Monthly Reminder for Installment Agreement Payment.

  2. Distribute reports and letters, to the assigned tax examiner by TSIGN.

  3. Update the following changes to the IAT list daily:

    1. Add TINs of new cases.

    2. Remove TINs of closed cases.

    3. Revisions of TINS for other changes.

    4. TINs of reinstated IA's.

  4. Generate the ASED report by the 7th of each month and distribute to the assigned tax examiner by TSIGN. Verify the report is completed by the 28th of each month.

5.4.11.5.2  (04-17-2013)
MMIA - IAT Monitoring Procedures

  1. Work the Manual Action List (MAL) upon receipt. Refer to the "Reason Box" to determine appropriate procedures.

  2. Annotate ICS/AMS case history, of all action taken.

    Note:

    History entries will contain enough information so any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve issues.

    If the reason box states: And ... Then ...
    Balance Due Modules NOT Found on Primary TIN primary account is full paid
    • Close modules on ICS

      Note:

      If balance due remains for secondary taxpayer input to ST 60.

    • Send Letter 4222 via ICS to taxpayer.

    • Send field cases to Closed Case function. All others are classified waste.

    • Provide updated information to IAT administrator.

    Note:

    If MMIA spouse portion is full paid and a continuous wage levy is on the primary TIN, put account into ST 60 using ALN 0208 and TSIGN the case to Area Office (AO000000).

    No FS2 BD Mods for Primary/Secondary account is full paid
    • Verify TIN is correct on IAT file.

    • Send Letter 4222 via ICS to taxpayer.

    • Close modules on ICS

    • Provide updated information to IAT administrator.

    No FS2 BD Mods for Primary/Secondary account is not full paid
    • Verify TIN and cross references are correct on IAT file.

    • Provide updated information to IAT administrator.

    No Data Found on TIF for Primary SSN Check IMFOL for balance due.
    • If account is in ST 53, input follow-up date and monitor account manually.

    • Advise IAT administrator to delete TIN.

      Note:

      Input ENMOD history on MFREQ'd modules.

    IA Payment Found on Secondary SSN Only and Includes Tax Year payment located
    • Transfer credit to correct module.

    • Provide updated information to IAT administrator and request 3856 voucher letter.

    Non Comp TDI: XX/XXXX condition exists
    • Assign to FORT to process return.

    • Input 14 day follow up for FORT referral.

    • Advise IAT administrator to remove IMF TDI indicator.

      Note:

      Do Not send default notice.

    .
    Default Ltr Sent Previously, 90 Day Period Expired IA is defaulted
    • Follow Default procedures. IRM 5.4.11.7, Default and Termination Procedures

    • Provide updated information to IAT administrator.

    Address Not on ENMOD/INOLES for Voucher Preparation no data on TIF
    • Manually issue 3856 voucher letter to address on record.

    • Advise IAT administrator to delete TIN.

    Hist MMIATFCCP Not Found on ENMOD Primary SSN  
    • Re-input/update ENMOD history. (Primary TP IA, MMIATFCCP input on ENMOD. Secondary TP IA, MMIATFCCP and MMIA4SSSN input to ENMOD.

      Note:

      Check account for ST 53.

    • Provide updated information to IAT administrator and request 3856 voucher letter, if appropriate.

    Computation Hold on INTEREST/FTP  
    • Compute INTEREST/FTP.

    • Manually issue 3856 voucher letter with computed INTEREST/FTP.

    Primary SSN is Not in Correct IMF Format  
    • Send 3856 voucher letter, if appropriate.

    • Provide updated information to IAT administrator.

    Account is Not on Master File  
    • Verify SSN on IAT.

    • Research IMFOL for account.

    • Provide updated information to IAT administrator and request 3856 voucher letter, if appropriate.

    INTST Balance Shows all Mods Full Paid account is full paid
    • Close modules on ICS

    • Provide updated information to IAT administrator.

    No Data-Reverse Validity for Primary SSN  
    • Send 3856 voucher letter

    • Provide updated information to IAT administrator to remove case from IAT.

    Innocent Spouse a TC 971 065 is posted to taxpayer on the IA
    • Close modules on ICS.

    • Provide updated information to IAT administrator.

    Innocent Spouse a TC 971 065 is posted to taxpayer not on the IA
    • Take no action.

    Bankruptcy the taxpayer on the IA is in bankruptcy
    • Close modules on ICS.

      Note:

      Post petition bankruptcy IAs are monitored.

    Bankruptcy the taxpayer not on the IA is in bankruptcy
    • Take no action.

    Combat Zone and Military Deferment the account has a -C freeze
    • If two payments have been missed, close case.

      Note:

      Do not send 2975 default letter.

    • Provide updated information to IAT administrator.

    OIC the taxpayer on the IA has an Offer In Compromise (OIC).
    • Close case (NF-OI).

    • Provide updated information to IAT administrator.

    OIC the taxpayer not on the IA has an Offer In Compromise (OIC).
    • Take no action.

    -O/S Freeze- Disaster Cases   No action is necessary, unless taxpayer requests voucher letter. Monitoring resumes once release date appears on ENMOD.

5.4.11.5.3  (04-17-2013)
IBTF - IAT Monitoring Procedures

  1. Work the Manual Action List upon receipt. Refer to the "Reason Box" to determine appropriate procedures.

  2. Annotate ICS case history, of all action taken.

    Note:

    History entries will contain enough information so any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve issues.

    If the reason box states: And Then ...
    CP523 Sent 90 Day Default Period Expired the condition exists
    • Ensure the paper case file has been secured.

    • Complete ICS Default checklist and place copy in case file.

    • Input TC 971 AC 163 on all modules included in the IA.

    • Change sub code to 900 and delete ICS follow-ups.

    • Transfer case on ICS, close NF-OI and send case file to the appropriate Territory Manager.

      Note:

      No action is necessary on modules not included in the IA. All modules will upload automatically to the RO's case file.

    • Advise IAT administrator to delete TIN.

    CP523 Sent 90 Day Default Period Expired does not exist
    • Advise IAT administrator to reinstate or re-set CP 523 date.

    Account Not on Master File the condition exists
    • Advise IAT administrator to delete incorrect TIN or update TIN.

    No Balance Due Tax Periods on BMFOLI for TIN the condition exists
    • Close NF OI and input history to ICS

    • Send Letter 4222 via ICS to taxpayer if the full paid letter has not been generated by IDRS.

    • Request case file and send to closed case

    • Advise IAT administrator to remove TIN from inventory.

    Business Closed Date Present on BMFOLE IDRS research indicates taxpayer is out of business
    • Verify TFRP has been addressed

    • Verify taxpayer is in compliance with all terms of the agreement

    • Close appropriate filing requirements

    • Change the ALN to 0209 .

    • Close the NF-OI to allow systemic monitoring.

    • Request case file and send to closed case

    • Advise IAT administrator to remove TIN from inventory.

    Business Closed Date Present on BMFOLE IDRS research indicates taxpayer is still in business
    • Ensure taxpayer's filing requirements are open

    • Update business closed date on ENMOD

    • Verify IA is in ST 60

    CP523 Sent XX/XX/XXXX 90 Day Default Period case meets default criteria
    • Input sub code 926

    • Request case file, set 60 day follow-up from the default date to ensure case file is received.

    CP523 Sent XX/XX/XXXX 90 Day Default Period does not meet default criteria
    • Notify IAT administrator to reinstate IA.

    BMF TDI 10 Week Suspense Period Expired return has not been filed
    • Verify 10 weeks have passed since CP 259 was sent.

    • Prepare 6020b and send Letter 1085 or a Letter 1616 for Forms 1065, U.S. Return of Partnership Income. Follow 6020b procedures. See IRM 5.4.10.5, IRC 6020(b). Prepare a FORT referral for IMF and Form 1120 , U.S. Corporation Income Tax Return, TDI's.

    • Advise IAT administrator of 6020b mail date.

    BMF TDI 10 Week Suspense Period Expired return is filed.
    • Advise IAT administrator to remove BMF TDI indicator.

    IMF TDI 10 Week Suspense Period Expired.

    Note:

    For sole proprietors, partnerships and Single Member Only (SMO) LLC (Disregarded Entities).

    return has not been filed.

    Note:

    Check cross-reference TINs

    • Assign to FORT to process return.

    • Input follow 14 day follow up for FORT referral.

    • Advise IAT administrator to remove IMF TDI indicator.

    IMF TDI 10 Week Suspense Period Expired.

    Note:

    For sole proprietors, partnerships and Single Member Only (SMO) LLC (Disregarded Entities).

    return is filed.
    • Advise IAT administrator to remove IMF TDI indicator.

    BMF 6020b Letter 45 Day Suspense Period Expired return has not been filed.
    • Input TC 599-63 on IDRS.

    • Code return and send returns for processing. See IRM 5.4.10.5Default and Termination Procedures.

    • Advise IAT administrator to remove BMF TDI indicator.

    BMF 6020b Letter 45 Day Suspense Period Expired return filed
    • Advise IAT administrator to remove BMF TDI indicator.

    Payment Not Found Credit Reversal on Account if research indicates the payment was misapplied
    • Apply payment to earliest CSED

    Payment Not Found Credit Reversal on Account if research indicates payment was missed
    • allow "skip"

    New Bal Due on X-Ref TIN if condition exist

    Note:

    IBTF Corp/LLC accounts (1120 filer) with TFRP assessments on the x-ref should not have 1040 assessments. If the x-ref defaults for 1040 liability do not default the Corp/LLC agreement.

    • Default to ST 64 BMF and IMF accounts.

    • Input sub code 926.

    • Request case file

    • Advise IAT administrator of CP 523 date.

    New Bal Due on X-Ref TIN does not exist
    • Provide updated information to IAT administrator.

    Bankruptcy: ST 72 condition exist
    • Close the NF-OI.

    • Request case file and send to closed case

    • Advise IAT administrator to remove TIN from inventory.

    IA Review date expired, not review case 2-YR  
    • Update IADIS with next review cycle in 3 years from current review cycle.

    Suspended IA, ST 61 condition exists
    • Input sub code 926.

    • Request case file

    • See IRM 5.4.11.7, Default and Termination Procedures.

    • Provide IAT administrator default date.

    Suspended IA, ST 61 condition does not exists
    • Reinstate the agreement.

    • Notify IAT administrator to reinstate IA.

    Origination Fee error  
    • Check user fee on IADIS.

    • Make necessary adjustments to user fee.

    OIC: ST 71 the taxpayer on the IA has an Offer In Compromise (OIC).

    Note:

    TC 480 posted.

    • Close case (NF-OI).

    • Request case file and send to closed case

    • Provide updated information to IAT administrator.

         

5.4.11.5.4  (04-17-2013)
PPIA - IAT Monitoring Procedures

  1. Work the Manual Action List upon receipt. Refer to the "Reason Box" to determine appropriate procedures.

    Note:

    When working PPIA-IAT Manual Action List use procedures above in addition to specific reason codes for PPIA cases listed below.

  2. Annotate ICS and AMS case history, of all action taken.

    Note:

    History entries will contain enough information so any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve issues.

    If the reason box states: And ... Then ...
    Two-year review cases - CP 522P printed taxpayer is not in full compliance with IA

    Note:

    Delinquent returns do not effect the compliance of an IA.

    • Do not mail CP 522P to taxpayer.

    • See IRM 5.4.11.7., Default and Termination Procedures.

    • Provide updated information to IAT administrator.

    Two-year review cases - CP 522P printed taxpayer is in full compliance with IA.
    • Mail CP 522P to taxpayer.

    • Provide updated information to IAT administrator.

    CP 522P sent, 37 day suspense period expired taxpayer did not respond to CP 522P.
    • SeeIRM 5.4.11.7, Default and Termination Procedures.

    • Provide updated information to IAT administrator.

    CP 522P sent, 37 day suspense period expired taxpayer responds with completed financial information.
    • Analyze financial information. See IRM 5.19, Liability Collection, and IRM 5.15.1, Financial Analysis Handbook.

    • Revise 2 year review cycle on IDRS.

    • Provide updated information to IAT administrator.

    Business Closed Date Present on BMFOLE IDRS research indicates taxpayer is out of business
    • Verify TFRP has been addressed

    • Taxpayer is in compliance with all terms of the agreement

    • Close appropriate filing requirements

    • Provide updated information to IAT administrator.

    Business Closed Date Present on BMFOLE IDRS research indicates taxpayer is still in business
    • Ensure taxpayers filing requirements are open

    • Update business closed date on ENMOD

    • Verify IA is in ST 60

    • Provide updated information to IAT administrator.

5.4.11.6  (01-01-2015)
Taxpayer Inquiries to Default Notices or Proposals to Change Installment Agreements

  1. Proposal to change IAs may result from letters or phone contact from the taxpayer. Do not solicit E-mails or respond to taxpayers by E-mail. E-mail responses violate IRS Security Policy.

  2. Follow disclosure procedures in IRM 5.4.13.1, Taxpayer Authenticity, and IRM 5.4.13.2, Clerical Procedures.

    Note:

    Beginning on January 9, 2012, some taxpayers may inform an IRS assistor they have a four digit transfer PIN provided by the previous IRS assistor. See IRM 21.1.3.2.6, Accepting Transferred Calls When the Taxpayer Provides a 4 Digit Transfer PIN.

  3. Check IDRS/ICS for case assignment. If the case is in ST 22, 24, or 26 and not assigned to CCP, refer to the appropriate function for resolution. ST 22 and 24 accounts will be referred to the general toll free number. Cases assigned to FC will be referred to the RO assigned to the case.

    Note:

    Check all available systems, including AMS, to ensure the taxpayer has not made other contacts to the Service.

  4. If the taxpayer requests to revise/reinstate or change the current terms of the IA see IRM 5.19.1.5.5.21, Revised/Reinstatement of Installment Agreements. Verify the address and update levy source(s) and history on ICS/AMS with actions taken, including responses received from the taxpayer. If a taxpayer responds to a notice on a subsequent MFT 35, the service employee can add the new period into an existing installment agreement without additional fees. This will almost always be completed by CCP, CSCO and/or AM employees. A subsequent MFT 35 WOULD NOT cause a default on existing installment agreements. If no response: do not default existing IA. If the taxpayer does not want the new SRP module added to the existing IA, then the SRP will be moved to recess (TC530 cc 35). This will happen systemically if no action is taken, and the case will not be assigned to ACS or Field Collection. The case will continue to be subject to refund offset if the taxpayer does not request to have the MFT 35 included in the IA. A subsequent MFT 35 WOULD NOT cause a default on the existing IA. If IA defaults for another reason i.e. failure to pay, it would only be reinstated if all modules, including any subsequent MFT 35 modules, were included

  5. If the taxpayer is requesting a lien payoff in writing and the case is in ST 26 and assigned to CCP, complete Letter 1038, Inquires about Release of NFTL. For general balance due requests, prepare Letter 3221 or Letter 3221A (joint accounts), Respond to Bal Due Inquiry, with current payoff information and mail to the taxpayer's last known address or representative. Both letters are available on ICS; however, amounts must be verified with IDRS (INTST) before issuing the letters.

  6. Provide taxpayers with specific deadlines and Warnings of Enforcement (WOEA). WOEA is required when the taxpayer is required to take some type of action. The warning should be appropriate to the facts of the case. Ensure taxpayers understand if they fail to perform the task as agreed, their noncompliance carries certain consequences.

    Example:

    Make payment/file by a certain date.

    Document and specify the WOEA.

    Exception:

    If a taxpayer contacts CCP after a WOEA is given and there is no new commitment made by the taxpayer, there is no requirement for WOEA again.

    Example:

    A taxpayer promises to submit a financial statement substantiation by a specific date, then calls back only to confirm the address to which the substantiation must be mailed. No WOEA is required as there has been no change to the taxpayer's commitment.

    Warn the taxpayer in a non-threatening manner the IRS may take enforced collection action if an agreement cannot be reached; the warning should be as specific as possible. It is not sufficient to state, "We will take enforcement action if you do not meet the terms of this agreement." Specifically state the next action IRS may take. See IRM 5.19.1.8, Warning of Enforcement Action and Enforced Collection, for next actions.

    Example:

    If you do not make the payment(s) as agreed, we may file a Notice of Federal Tax Lien and/or take the next step to levy your bank account and your wages.

    If taxpayer's IA has not defaulted and taxpayer makes a And ... Then ...
    request to change the payment due date taxpayer is in compliance with IA
    • Allow change.

    • Update IDRS and ICS/AMS with the new payment due date.

    • Provide updated information to IAT administrator, if necessary.

    requests to change the IA amount request is to increase payment amount
    • Allow increased payment amount.

    • Do not make any changes to IDRS or ICS.

    • Continue to monitor the case according to procedures.

    requests to decrease the payments less than or equal to 20% of the current payment amount the IA will be paid in full with the lowered payments prior to three months of the CSED(s) or six months of any unsatisfied ASED and the taxpayer is compliant with filing and payment requirements.

    Note:

    If the taxpayer is not in compliance with filing and payment requirements, a request to decrease payments cannot be considered.

    • Prepare a Form 4844, Request for Terminal Action, to obtain managerial approval. Manager will document ICS/AMS.

    • Allow the decreased payment amount.

    • Notify the taxpayer of the change to the IA.

    • Update IDRS/AMS and ICS with the new payment amount.

    • Provide updated information to IAT administrator.

    requests to decrease the payments less than or equal to 20% of the current payment amount the IA will be not be paid in full with the lowered payments prior to three months of the CSED(s) or six months of any unsatisfied ASED and the taxpayer is compliant with filing and payment requirements.

    Note:

    If the taxpayer is not in compliance with filing and payment requirements, a request to decrease payments cannot be considered.

    • For IMF accounts, complete financial screen within AMS if the taxpayer has the necessary information available. If the taxpayer does not have the necessary information request a CIS (Form 433F, Collection/Information Statement) to be completed within 14 days.

    • For BMF accounts or self employed taxpayers request a Form 433-A, Collection Information Statement for Wage Earners and Self-Employed Individuals, or Form 433-B, Collection Information Statement for Businesses, from the taxpayer and prepare a FORT referral when received.

    • Advise the taxpayer to continue making the monthly payment until the CIS has been approved or denied.

    • Analyze CIS for IMF taxpayers per IRM 5.19.1.6, Securing Financial Information, and IRM 5.15.1, Financial Analysis.

    • If the CIS indicates the taxpayer has the ability to make the scheduled payment amount, notify the taxpayer to continue making the scheduled payment.

    • If the CIS indicates the taxpayer does not have the ability to make the scheduled payment refer to the FORT.

    requests to decrease the payments for more than 20% of the current payment amount the IA is for an IMF account
    • Complete financial screen within AMS, if taxpayer has the necessary information available. If taxpayer does not have necessary information request a CIS to be completed within 14 days.

    • Advise the taxpayer to continue making the monthly payment until the CIS has been approved or denied.

    • Analyze CIS per IRM 5.19.1.6, Securing Financial Information, and IRM 5.15.1, Financial Analysis Handbook.

    • If the CIS indicates the taxpayer has the ability to make the scheduled payment amount, notify the taxpayer to continue making the scheduled payment.

    • If the CIS indicates the taxpayer does not have the ability to make the scheduled payment refer to the FORT.

    requests to decrease the payments for more than 20% of the current payment amount the IA is for a BMF account
    • Request a Form 433 A/B from the taxpayer to be completed within 14 days.

    • Advise the taxpayer to continue making the monthly payment until the CIS has been approved or denied.

    • Refer the case to the FORT when the Form 433 is received.

    is unable to make a scheduled payment and the skip(s) has been used
    • Advise the taxpayer to make payments as they can for as much as they can to reduce penalty and interest,

    • Advise the taxpayer that the account will default if the full payment is missed and they will receive a default notice (2975 Ltr/CP 523) providing appeal rights.

    • Advise the taxpayer the case will be assigned back to an RO who will contact them.

    • Continue to monitor the case according to procedures.

    is unable to make a scheduled payment and the skip(s) have not been used. See IRM 5.19.1.5.5.20, Payment Skips (Missed Payments).

    Note:

    For IMF accounts a second skip is allowed when hardship criteria is met.

    • Allow "skip." Inform the taxpayer you are allowing the missed payment and they must make the next month's payment on schedule.

    has an erroneous levy taxpayer has a valid MMIA
    • Request a copy of the Notice of Levy from the taxpayer.

    • Prepare a FORT referral and expedite to FORT for Levy release.

    • If erroneous levy payments have been received, prepare a FORT referral for resolution.

    concerning not being able to make payments due to a disaster the IA is an MMIA
    • See IRM 25.16.1.13, Disclosure Provisions When Providing Emergency Relief

    If taxpayer's IA has defaulted and taxpayer And ... Then ...
    is able to make up missed payment was caused by a one-time event
    • Give the taxpayer seven days to send in missed payment. Advise the taxpayer of the reinstatement user fee.

    • Advise taxpayer that failure to make up missed payment will result in the case being returned to the RO.

    • Give WOEA

    • Set 21 day follow-up on ICS for receipt of payment.

    • If payment is received, revise IA.

    • Advise IAT administrator to reinstate IA.

      Note:

      Do Not suppress User Fee.

    is unable to make up missed payment  
    • Advise the taxpayer to make payments as they can for as much as they can to reduce penalty and interest,

    • Advise taxpayer the case will be assigned back to an RO who will contact them.

    • Follow default procedures, IRM 5.4.11.7, Default and Termination Procedures, if case has not yet been returned to an RO.

    If the IA was defaulted because of an additional liability the taxpayer will full pay the new liability within 14 days
    • Provide the taxpayer with balance due using INTST adding 10 days to the taxpayers requested pay off date, if the payment is being mailed and to the date the taxpayer plans to authorize the payment if paying by credit card.

    • Set a 21 day follow-up to monitor for full payment of new liability.

    • If the new liability is full paid: Reinstate the agreement. and provide updated information to IAT administrator.

    • If the new liability is not full paid continue with default procedures, see IRM 5.4.11.7, Default and Termination Procedures.

    If the IA was defaulted because of an additional liability the new liability (ICOMP) will result in no more than two additional monthly payments and the agreement will not extend beyond the imminent ASED/CSED.
    • Reinstate the agreement.

    • Assess the appropriate reinstatement/revised user fee.

    • Notify the taxpayer a lien may be filed.

    • Prepare a FORT referral for a lien determination

    If the IA was defaulted because of an additional liability the new liability (ICOMP) will result in more than two additional monthly payments or the agreement will extend beyond the imminent ASED/CSED.
    • Advise the taxpayer to make payments as they can for as much as they can to reduce penalty and interest,

    • Advise taxpayer the case will be assigned back to an RO who will contact them.

    • Follow default procedures, IRM 5.4.11.7, Default and Termination Procedures, if case has not yet been returned to RO.

5.4.11.7  (04-17-2013)
Default and Termination Procedures

  1. When taxpayers do not meet the terms of their IA, the agreement will be terminated. Taxpayers may appeal proposed terminations.

  2. Complete ICS Default checklist, document AMS when appropriate.

  3. Change 926 sub codes to original case sub code.

  4. Secure the paper case file, transfer the case back via ICS, and mail the paper case file to the appropriate Group Manager. Copy and paste the "Default Checklist" in an E-mail to the Territory Manager when the case is transferred to the FC function.

    Note:

    IBTF cases will systemically be assigned to the Group Manger's hold file upon default.

5.4.11.7.1  (04-17-2013)
MMIA Default Procedures

  1. When an agreement defaults, taxpayers with IDRS-monitored agreements receive CP 523, Default Installment Agreement-Notice of Intent to Levy. In the case of taxpayers with manually monitored agreements, Letter 2975, Notice of Intent to Levy under IRC section 6221(d), will be issued when an agreement defaults. Like the CP 523, Letter 2975 gives the taxpayer 30 days to comply with the terms of the agreement before an IA is terminated. Letter 2975 must be issued no less than 30 days before the date of termination in all non-jeopardy situations.

  2. Issue Letter 2975 as follows:

    1. complete the identification information on the top of the letter;

    2. provide the reason the agreement defaulted, see IRM 5.14.11.3, Reasons for Proposing Termination (Defaulting) of Installment Agreements.

    3. compute penalty and interest to 30 days from the date of the letter;

    4. include Publication 594, The IRS Collection Process, and a non-postage-paid return envelope with the letter;

    5. include Publication 1660, Collection Appeal Rights, see IRM 5.14.9.8, Collection Appeals Program; and

    6. send the letter by certified or registered mail, return receipt requested.

    Note:

    For SMO/LLC IBTF-IA, separate 2975 letters must be issued to the SMO and the LLC.

  3. After 90 days from the issuance of the default letter if

    1. the IA has not been reinstated;

    2. a new IA has not been placed into effect and/or will not be entered into soon;

    3. the taxpayer has not requested a Collection Appeals Program hearing for the default or termination of the IA; or

    4. the taxpayer has not requested a Collection Due Process hearing;

    input TC 971 AC 163 on all appropriate periods and transfer the case to the appropriate group pursuant to zip code and grade level using the ICS parameter tables. See IRM 5.1.9.3.6.1 , Transaction Code TC 520 and TC 521 CC 76 or 77.

    Note:

    In addition to checking the case history, check IDRS for TC 520 CC 76 or 77 to determine if there is an active CDP Appeal. A TC 971 AC 275 indicates a CDP Appeal request has been received, but not yet opened as a case. If Appeals determines an IA is not the proper case resolution, or if the resolution cannot be completed within CCP, forward the case to the appropriate FC group pursuant to the zip code and grade level of the case listed in the parameter tables located in ICS. If there is currently an OI assigned to FC, transfer the case to the proper employee.

    Note:

    If an Other Investigation (OI) is currently assigned to a field employee, transfer the case to that employee.

5.4.11.7.2  (04-17-2013)
IBTF Default Procedures

  1. When an IBTF defaults for failure to pay additional liabilities when due or failure to make installment payments, a CP 523, Default Installment Agreement-Notice of Intent to Levy, should be issued from IDRS.

    Note:

    Because IBTF's are monitored in ST 60, they will default if taxpayers do not make payments or if new accounts are assessed. If an IBTF includes liabilities assessed in the name and EIN of an LLC when the SMO is identified as the liable taxpayer, the IBTF should not be defaulted if new accounts are assessed for employment tax periods beginning on or after January 1, 2009, when the LLC is the liable taxpayer. See IRM 5.1.21, Collecting from Limited Liability Companies and IRM 5.14.7.3.1, Installment Agreements When Owner is Liable for Assessments in LLC Name, and IRM 5.14.2, Partial Payment Installment Agreements and the Collection Statute Expiration Date, for procedures pertaining to these instances. Since the LLC may be liable for new tax periods assessed in the name and EIN of the LLC, issue an OI to the originator to address new liabilities and continue to monitor the SMO portion of the IA.

  2. Verify the CP 523, Default Installment Agreement-Notice of Intent to Levy, was issued.

    Note:

    For SMO/LLC IBTF-IA agreements, no CP 523 will be issued. Verify separate Letters 2975, Notice of Intent to Levy under IRC section 6221(d), were sent to the SMO and LLC.

  3. If the CP 523 not was not sent, input command code IADFL. This will cause:

    1. the account to update to ST 64; and

    2. issuance of the default notice CP 523.

  4. If payment was received from the taxpayer, notate the case history and verify the case was reinstated to ST 60.

  5. If, after receipt of payment, the case was not reinstated to ST 60, verify there is no other reason for the default condition, and reinstate to ST 60.

  6. If the IA has not been reinstated after 90 days see IRM 5.4.11.7.1(3), MMIA Default Procedures.

    Note:

    Defaulted IAs will automatically upload to the group manager approximately 70 days after the default notice is sent. Route the paper case file to the Group Manager after the 90th day. Copy and paste the "Default Checklist" in an E-mail to the Territory Manager when the paper case is mailed to FC. Ensure any associated balance due is assigned to the appropriate group. Do not review for a cure of the default or contact the RO if the case has automatically uploaded to the field.

  7. If the TFRP has not been assessed forward the TFRP file to the FORT.

5.4.11.8  (04-17-2013)
PPIA Two Year Financial Review

  1. After approval of the MMIA/IBTF Partial Payment Installment Agreement (PPIA) by the field group manager, a systemic Other Investigation (OI), "101 - PPIA Monitor" will be generated on ICS and assigned to CCP for the two year review.

  2. When notification of the two year review is received generate the CP522P letter using ICS and mail to the taxpayer.

  3. ICS will systemically generate a 30 day follow-up from the date of the letter. The ICS history will indicate "Follow-up PPIA Review Letter."

  4. When notification of the PPIA review letter follow-up is received, and no response has been received from the taxpayer, follow default procedures. See IRM 5.4.11.7, Default and Termination Procedures.

5.4.11.8.1  (04-17-2013)
PPIA Review Letter (CP522P) Responses

  1. Annotate ICS/AMS case history with actions taken.

    Note:

    History entries will contain enough information so any person subsequently reading the history can easily determine what decisions were made, why those decisions were made, what actions were taken and what further actions are required to resolve issues.

  2. Managerial approval is needed on all (newly completed) two year financial reviews.

    • Document AMS that the financial review was completed and forwarded to manager for approval.

    • Provide a copy of AMS financial print to the manager.

    • Managers will review the financial print and approve or disapprove the financial analysis.

    • Manager will document AMS with "FINAPP" when the analysis of the financial statement is completed and approved.

    • Financial statements not approved will be documented in AMS with the reason why the financial was not approved and returned to the originating employee for follow-up.

  3. When conducting a two-year review, consider the taxpayer's income, expenses, assets and equity to determine if:

    1. the liability can be full paid, or;

    2. an adjustment to the payment amount is necessary, or;

    3. the agreement should continue without change, or;

    4. the taxpayer is unable to pay.

    Note:

    If at anytime during the process the taxpayer qualifies for and agrees to an SIA, input of the financial information is not necessary. Input the IA as agreed to, document AMS with SIA information, input levy sources, if present, and destroy the Form 433. See IRM 5.19.1-7,CC IAREV.

  4. Use IRM 5.4.13.1, Disclosure to Persons with a Material Interest.

    Note:

    The Service may work directly with a taxpayer who has a POA to resolve an issue on the taxpayer's account. If the taxpayer initiates the contact expressing a specific desire to resolve the issue without the involvement of the POA, advise the taxpayer of the current representative (per Centralized Authorization File (CAF)) for that tax period and form. Resolution of the issue must be properly documented on AMS.
    Third party designees (check box authority) and unauthorized third parties do not have the authority to enter the taxpayer into an extension or a formal IA.
    Always check the authority level of a valid POA, per CC RFINK and CFINQ, before granting an extension or an IA.

  5. When contacted by the taxpayer or their authorized representative, CCP will conduct a two-year financial review using AMS, for IMF accounts. See IRM 5.15.1, Financial Analysis Handbook, for two-year financial review criteria.

    Note:

    If the taxpayer needs additional time to provide the financial information, allow no more than 14 additional days or the date the review cycle expires, which ever is earliest.

  6. If it is a business taxpayer request a completed Form 433 A/B from the taxpayer. Set 14 day follow-up. Update the review cycle if necessary to prevent the account from defaulting. Prepare a FORT referral after financial information is secured and update review cycle for four cycles.

    Note:

    The CP522P refers BMF taxpayers to the FORT for financial analysis.

    Note:

    If the account has already defaulted, do not revise the agreement until the financial analysis is completed.

  7. If the taxpayer states they have a court ordered payment such as alimony, child support, state and other court order payments, or, based on a taxpayer's individual facts and circumstances, it may be appropriate to deviate from the standard amount when failure to do so will cause the taxpayer economic hardship. Payments for other expenses such as state or local tax payments and student loans may also be allowed in certain circumstances. See IRM 5.19.1.6.2.6, Other Necessary Expenses. The taxpayer must provide reasonable substantiation of all expenses claimed that exceed the standard amount, CCP must:

    1. Request a copy of the agreement, court order or substantiations for expenses by fax or mail. If the taxpayer does not have access to a fax machine allow 14 days for mailing.

    2. Complete 2-year financial review.

    3. Document case history with all action taken.

    4. Prepare a FORT referral after securing the documentation.

    5. Update IADIS for 4 cycles to prevent the case from defaulting.

    Note:

    Attempt to secure all available financial information during the initial contact.

  8. If the taxpayer now has the ability to full pay, demand will be made for full payment.

  9. If the taxpayer has ability to borrow, per the "financial statement" on AMS summary page, and can apply the amount to the liability in full or in part, the taxpayer will be required to utilize the equity before a new PPIA will be allowed on the remaining liability. Request loan approval/denial from the taxpayer be submitted within 30 days and update IADIS for four cycles to prevent the case from defaulting. Prepare a FORT referral after securing documentation.

  10. If the financial review indicates the taxpayer's ability to pay an amount that is different from the existing agreement and the payment amount needs to be increased, (more than 20% of the established IA amount), notify the taxpayer accordingly, verbally on the phone or in writing, and revise the IA.

  11. If there is no significant change to the taxpayer's financial situation (payment increase of 20% or less than the established IA amount), or if the review indicates a reduced ability to pay, the agreement will continue as originally established. The taxpayer will be notified that there is no change in the agreement. If the taxpayer requests the current payment to be reduced, allow a 20% reduction.

  12. If the taxpayer is required to take some type of action, provide the taxpayer with specific deadlines and WOEA. The warning should be appropriate to the facts of the case. Ensure the taxpayer understands that if they fail to perform the task as agreed their noncompliance carries certain consequences.

    Example:

    Make payment/file by a certain date.

    Document and specify the WOEA.

    Exception:

    If a taxpayer contacts CCP after a WOEA is given and there is no new commitment made by the taxpayer, there is no requirement for WOEA again.

    Example:

    A taxpayer promises to submit a financial statement substantiation by a specific date, then calls back only to confirm the address to which the substantiation must be mailed. No WOEA is required as there has been no change to the taxpayer's commitment.

    Warn the taxpayer in a non-threatening manner the IRS may take enforced collection action if an agreement cannot be reached; the warning should be as specific as possible. It is not sufficient to state, "We will take enforcement action if you do not meet the terms of this agreement." Specifically state the next action IRS may take. See IRM 5.19.1.8, Warning of Enforcement Actions and Enforced Collection, for next actions.

    Example:

    If you do not make the payment(s) as agreed, we may file a Notice of Federal Tax Lien and/or take the next step to levy your bank account and your wages.

  13. If CCP is unable to revise the agreement or take other action necessary to resolve the case, i.e. taxpayer refuses the new proposal, the agreement will be allowed to default.

  14. Update levy source on LEVYS.

  15. Update the two-year review cycle by updating the Agreement Review Date on IAGRE and input the new review cycle to ICS if there is a PPIA OI.

    Note:

    If the agreement no longer qualifies as a PPIA, update the PPIA indicator.

5.4.11.9  (04-17-2013)
Installment Agreement Account Listings (IAAL)

  1. Do not work the Installment Agreement Account Listings (IAAL) generated for CCP. All categories are now included on the IAT Manual Action Lists (MAL) generated daily.


More Internal Revenue Manual