5.14.5  Streamlined, Guaranteed and In-Business Trust Fund Express Installment Agreements

5.14.5.1  (08-05-2010)
Overview

  1. Streamlined and In-Business Trust Fund Express agreements benefit taxpayers because they may be processed quickly, without financial analysis or managerial approval. Guaranteed agreements provide qualified taxpayers who have a one-time account delinquency the statutory right to an agreement if their taxes are $10,000 or less and certain other conditions are met. A Full Pay Within 60 or 120 Day Agreement (Formerly Extension of Time to Pay) may be granted to taxpayers who are able to pay by a certain date by W&I and SB/SE Campus Compliance and ACS employees (See IRM 5.19.1.5.3). Collection Field function employees are not authorized to grant Full Pay Within 60 or 120 Day Agreements (Formerly Extensions of Time to Pay).

5.14.5.2  (03-11-2011)
Streamlined Installment Agreements

  1. Streamlined installment agreements may be approved for taxpayers under the following circumstances:

    1. The aggregate unpaid balance of assessments (the SUMRY balance) is $25,000 or less. The unpaid balance of assessments includes tax, assessed penalty and interest, and all other assessments on the tax modules. It does not include accrued penalty and interest.

    2. If pre-assessed taxes are included, the pre-assessed liability plus unpaid balance of assessments must be $25,000 or less.

    3. The aggregate unpaid balance of assessments will be fully paid in 60 months, or the agreement will be fully paid prior to the CSED, whichever comes first. (Use IDRS CC ICOMP.)

  2. Accounts in any status qualify, including:

    • Notice status accounts;

    • Balance due status accounts; and

    • Pre-assessed accounts.

  3. The following types of taxpayers qualify for streamlined agreements:

    • IMF;

    • BMF (income tax only); and

    • Out of business BMF (any type tax).

      Note:

      See IRM 5.14.4.3(2) and (3) when your request involves including related IMF/BMF accounts into one IA.

  4. A lien determination is not required for a streamlined installment agreement but may be made at the discretion of the revenue officer and liens may be filed.

    Note:

    Per IRM 5.12.2.4 a lien determination is required by a specific date. If the case cannot be closed as a streamlined IA on or before the lien determination date, a lien determination must be made based on the facts of the case. The revenue officer has the latitude to make a timely lien determination as a non-filing or deferral of the lien filing, then finish the negotiation and close the case to a streamlined IA.

  5. No managerial approval is required.

  6. These agreements may be secured in person, by telephone or by correspondence.

  7. As with all agreements, the taxpayer must have filed all tax returns that are due prior to entering into the agreement. (See IRM 5.14.1.3 and IRM 5.14.1.4.1).

  8. See IRM 5.14.11.5(2)(a), regarding reinstatement of agreements that meet streamlined criteria.

  9. Encourage taxpayers to pay assessed amounts greater than $25,000 to:

    • avoid the need for securing financial statements; and,

    • qualify for streamlined agreements.

    [See IRM 5.14.1.4(7) (Example)]

  10. Taxpayers may be granted streamlined agreements based on the criteria provided in IRM 5.14.5.2(1) – (9), even if they are able to fully pay their accounts.

  11. Penalties and interest continue to accrue throughout the duration of an installment agreement. If taxpayers are notified of this they may decide it is in their best interest to fully pay balance due accounts.

5.14.5.3  (03-11-2011)
Guaranteed Installment Agreements

  1. Internal Revenue Code (IRC) section 6159(c) requires the Service to accept proposals of installment agreements under certain circumstances. In accordance with IRC 6159(c) the Service must accept proposals to pay in installments if taxpayers are individuals who:

    1. owe income tax only of $10,000 or less (excluding penalties and interest);

    2. have not failed to file any income tax returns or to pay any tax shown on such returns during any of the preceding five taxable years;

    3. cannot pay the tax immediately (see (2) below);

    4. agree to fully pay the tax liability within 3 years;

    5. agree to file and pay all tax returns during the term of the agreement; and

    6. have not entered into an installment agreement during any of the preceding five taxable years.

      Note:

      The minimum monthly payment amount of ≡ ≡ ≡ ≡ does not apply to guaranteed installment agreements. (See IRM 5.14.4.2.)

  2. As a matter of policy, the Service grants guaranteed agreements even if taxpayers are able to fully pay their accounts. (See also IRM 5.14.1.4(8), and IRM 5.14.5.2(10).)

  3. Unlike the criteria for streamlined agreements, the dollar limit for guaranteed agreements of $10,000 only applies to tax. The taxpayer may owe additional amounts in penalty and interest (both assessed and accrued) and qualify for a guaranteed agreement, so long as the tax liability alone is not greater than $10,000.

  4. Guaranteed installment agreements may be granted by revenue officers and other contact employees. Managerial approval is not required for these agreements.

  5. A lien determination is not required for a guaranteed installment agreement but may be made at the discretion of the revenue officer and liens may be filed.

    Note:

    Per IRM 5.12.2.4 a lien determination is required by a specific date. If the case cannot be closed as a guaranteed IA on or before the lien determination date, a lien determination must be made based on the facts of the case. The revenue officer has the latitude to make a timely lien determination as a non-filing or deferral of the lien filing, then finish the negotiation and close the case to a guaranteed IA.

  6. IDRS CC ICOMP will be used to determine if the tax, including statutory additions, can be fully paid within three years.

  7. If taxpayers do not qualify for guaranteed agreements, consider streamlined agreements prior to considering other alternatives. Process guaranteed agreements as streamlined agreements on ICS.

  8. Penalty and interest continue to accrue during these – and all other – installment agreements, though they are guaranteed by law. If taxpayers are notified of this they may decide it is in their best interest to fully pay balance due accounts.

5.14.5.4  (03-11-2011)
In-Business
Trust Fund Express
Installment Agreements

  1. In-Business Trust Fund (IBTF) Express installment agreements may be granted if:

    1. The entire liability including accruals (INTST) total ≡ ≡ ≡ ≡ ≡ ≡ or less when the case is received in inventory. The taxpayer may not reduce a liability that exceeds ≡ ≡ ≡ ≡ ≡ in order to qualify.

    2. Taxes are fully paid in 24 months, or before the CSED, whichever is earlier. (Use IDRS CC ICOMP to calculate agreement lengths. See IRM 5.14.2.2 regarding CSED extensions.)

  2. If accounts qualify for IBTF Express agreements:

    1. Collection Field function employees must make a field call to view assets and request full payment prior to granting an IBTF Express agreement.

    2. No financial statement is required.

    3. Input bank and receivables information to ICS.

    4. A lien determination is required by Collection Field function employees, see IRM 5.12.2.4 (no lien determination is required by ACS or Campuses, but liens may be filed if they will protect the government’s interest, such as if a property sale is imminent).

    5. No Trust Fund Recovery Penalty determination is required; however, the revenue officer must ensure that the Assessment Statute Expiration Date (ASED) is protected.

    6. Check IDRS for (and verify with taxpayers) filing and payment compliance. If not in filing compliance, installment agreements may not be granted.

    7. If for any reason rejection of installment agreements is planned, refer for Independent Administrative Review. (See IRM 5.14.9.7).

  3. Managerial approval is required.

  4. If IBTF Express agreements are in default, or are terminated, they may be reinstated or new agreements may be granted immediately if:

    1. The taxpayer re-qualifies for an agreement under the above guidelines, or other guidelines provided in this manual. (Also see IRM 5.14.11).

    2. The Collection Statute Expiration Date (CSED) is considered (See IRM 5.14.5. 4(1)(b).)

  5. Business accounts over ≡ ≡ ≡ ≡ ≡ ≡ do not qualify for IBTF Express agreements.

    1. Use Streamlined procedures (IRM 5.14.5.2) for income taxes on in business accounts and out of business accounts $25,000 or less.

    2. See IRM 5.14.7 for IBTF accounts that do not meet the above criteria.

  6. If you have a case that is an IBTF-Express IA that is paid using the direct debit payment option, see IRM 5.14.10.5 for input, approval, and routing procedures for this type of IA.

5.14.5.5  (03-11-2011)
Disposition of Approved Installment Agreement Documents

  1. The preferred method of closing Guaranteed, Streamlined, and In-Business Express IAs is by choosing Option A on the ICS Installment Agreement menu. Choosing this method of closure allows these installment agreements to be systemically uploaded from ICS to IDRS.

  2. After the group manager approves the IA (if applicable), an ICS Print Manager Dialogue box provides the option of e-mail or immediate printing of the Form 433-D and Letter 2850. An ICS history entry is generated stating the IA was systemically uploaded to IDRS.

  3. Generation of the acceptance letters and Form 3210s has not changed with the systemic upload process. You are still responsible for mailing of the Letter 2850 to the taxpayer and power of attorney, if applicable.

  4. Write "FILE COPY" in RED ink along the top of the Form 433-D and place it in the closed case file. Send the closed case file to CCP on a manually created Form 3210 or Form 795-B to:

    Internal Revenue Service

    2970 Market Street

    Mail Stop 5-E04.115

    Philadelphia, PA., 19104

  5. If a hard copy of Form 433-D was prepared and approved outside of ICS, select "Option B" under the Installment Agreement menu to close the case on ICS. Selection of this option will generate a TC 971 AC 063. Use the systemically generated Form 3210 to route the agreement (Form 433D) to CCP at:

    Internal Revenue Service

    2970 Market Street

    Mail Stop 5-E04.114

    Philadelphia, PA., 19104

  6. Use either the Form 795-B or a Form 3210 to send the case file to closed files to CCP at Mail Stop 5-E04.115.

  7. Option B does not systemically generate an approval notification, Form 433-D or the Letter 2850. Create the Letter 2850 from the Installment Agreement menu under the Templates Listing on ICS. It is your responsibility to mail the letter to the taxpayer and power of attorney, if applicable.


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