When a CDP OIC is being rejected, the OIC file should contain:

The decision to reject the offer is conveyed in the attachment to the determination/decision letter. The attachment must state that the OIC was rejected and the reason for the rejection including a discussion of Reasonable Collection Potential (RCP) when RCP is the basis of the rejection. Rejection Letter 238 is not used.

Once the above documents are complete and assembled, update ACDS case status to 'AC/FR' and submit the CDP and OIC case files together to the ATM for approval.

The administrative review requirements of IRC 7122(e), Administrative review, apply only when a function of the IRS other than Appeals rejects the offer. The review of the proposed rejection by the ATM constitutes the independent administrative review. A taxpayer is not entitled to an administrative appeal if the taxpayer submits an offer to Appeals and Appeals rejects the offer.

When a CDP OIC is being withdrawn, the file should contain:

Withdrawal Letter 241 is not used since the withdrawal is conveyed in the attachment to the determination/decision letter.

Once the above documents are complete and assembled, update ACDS case status to 'AC/FR' and submit the CDP and OIC case files together to the ATM for approval.

APS will input TC 481 reflecting the date of the withdrawal. Under Regs. 301.7122-(d)(3), Special rules relating to treatment of offers, an offer is considered withdrawn as of the date the Service acknowledges the withdrawal in writing. However, if the taxpayer hand delivers the written withdrawal or sends it by certified mail, the offer is withdrawn as of the date of IRS' receipt of the withdrawal. If you receive the withdrawal by certified mail or personal delivery, indicate on the Form 5402 the date of IRS receipt so that TC 481 is properly dated.

When a CDP OIC is being accepted and counsel review is not required, the file should contain:

When recommending acceptance of two or more related offers based on a single financial analysis, only one OIC ACM is necessary. To ensure proper processing of the related offers, create separate files marked “1 of 2,” and “2 of 2.” The separate files should contain the documents listed above except for the single consolidated ACM.

Once the above documents are complete and assembled, submit the CDP and OIC case files to the ATM for approval.

Counsel is required to review all offers when the total liability including tax, penalties and interest for all related offers for the same taxpayer is $50,000 or more. This amount is generally shown on the Form 7249, Offer Acceptance Report. The purpose of Counsel's review is to determine whether the offer legally meets the standards of doubt as to collectibility, doubt as to liability, or the promotion of effective tax administration.

When a CDP OIC is recommended for acceptance and counsel review is required, the file should contain:

Local procedures dictate how to route the OIC file to Counsel for their review. Due to the number of variables involved in managing different sized offices and employees in remote offices, the following guidance is general in nature. Each office must establish its own processes within the following framework to effectively manage and control the flow of the case and input of the required data at the appropriate time.

If an offer is ultimately rejected due to an unfavorable review by Counsel, enter an explanation in the history as to why Counsel declined to sign and why the offer was ultimately rejected.

The IRS is required to "send any notice relating to a joint return under section 6013 of the IRC separately to each individual filing the joint return." This ensures both spouses are aware of their tax situation in joint tax liabilities.

The following closing letters are sent separately to each individual requesting a hearing on a joint return:

Print an ENMOD or INOLES when closing a CDP to ensure the closing letter is mailed to the taxpayer's most current address.

Appeals may disregard any portion of the CDP or EH hearing request when the request states a position which the Service has publicly identified as frivolous or reflects a desire to delay or impede the administration of the federal tax laws. See IRM 8.22.5.5.3, Frivolous Issues.

If a taxpayer failed to respond within 30 days or responded with frivolous or desire-to-delay statements after receiving Letter 4380, Frivolous Acknowledgement, Letter 4381, Disregard Frivolous, is used to advise the taxpayer the hearing request has been disregarded.

An attachment is not prepared for Letter 4381 since Appeals did not conduct a legal and administrative analysis.

When you reach an agreed resolution and the taxpayer signs Form 12257, prepare Letter 4382 as a cover letter. This letter acknowledges receipt of Form 12257 and the agreed resolution of the CDP.

Document the agreement reached on either Form 12257 or Letter 4382 including the terms of the agreed resolution:

Letter 4382 is signed by the ATM with two exceptions. Delegation Order App-193-1 allows Appeals Officers, Settlement Officers or Account Resolution Specialists to sign Form 12257 and Letter 4382 when either:

The hearing officer that signs the Form 12257 and Letter 4382 will:

Prepare Letter 4383 when a taxpayer withdraws a CDP request and Appeals sent the Uniform Acknowledgement Letter or combination UAL-Substantive Contact Letter. Letter 4383:

Do not send Letter 4383 if the withdrawal was received before Appeals acknowledged receipt of the case with either the UAL or combination UAL-SCL.

In a withdrawal, there is no need to:

Use the following codes on the Form 5402:

At the conclusion of an EH hearing, prepare one of the following decision letters in APGolf:

If a CDP liability is paid and the taxpayer doesn't withdraw the request, you still must issue a decision Letter.

The Decision Letter Summary Statement is found at the bottom of the letter. The Summary Statement:

At the conclusion of a CDP hearing, prepare one of the following determination letters in APGolf:

If a CDP liability is paid and the taxpayer doesn't withdraw their request, you still must issue a determination letter.

The summary statement is found at the bottom of the Determination letter. The summary statement:

At the start of the attachment, list the type of tax, period(s), date of the CDP notice(s), and date of taxpayer's CDP request. Only list periods that appeared in the CDP notice(s).

State whether you conducted a CDP levy hearing, a CDP lien hearing or a combination of both.

If the request was based on both lien and levy notices, specify tax and periods listed in each notice.

If the tax includes civil penalty module(s), specify the code section under which the penalty was imposed.

This section briefly summarizes what the reader will find in the rest of the document. Clearly state what your determination was regarding the hearing.

The brief background section of the attachment describes:

Hearing officers are required by law to consider three areas in a CDP determination, referred to as the "Big Three." Your attachment must contain a discussion of the "Big Three" review:

This section is for discussing the legal and administrative review conducted as described in IRM 8.22.5.4.2, Legal and Administrative Procedure Review. Use of the attachment template in APGolf is highly recommended as it will prompt you to document the bolded verification items described below:

Valid Assessment: Was a valid assessment made for each tax and period on the CDP notice? Invalid assessments must be abated and collection cannot proceed. If the liability arose from a Statutory Notice of Deficiency (SNOD) or Letter 1153 10 Day Notification Letter, discuss whether the notice was properly issued as per IRM 8.22.5.4.2 . Discussion should include whether:

Receipt of the SNOD or 1153 is not required to verify an assessment is valid. Receipt is relevant to establishing whether liability was properly at issue in the hearing. If the taxpayer admitted receipt of the notice, document it here. If the taxpayer denied or could not recall receipt of the notice, see the table below for additional documentation:

Notice and Demand: Was notice and demand issued to the taxpayer’s last known address within 60 days of assessment as per IRC 6303? Failure to give notice and demand within 60 days doesn’t invalidate the notice and demand or the assessment. See Treas. Reg. 301.6303-1(a). If the IRC 6303 notice was not issued or issued late, any other collection notice can constitute notice and demand for purposes of the statute.

Balance Due: Was there was a balance due at the time the CDP notice was issued?

CDP Notice Properly Issued: CDP notice verification requires you to confirm the CDP lien or levy notice was properly issued to the taxpayer. Properly issued means the CDP notice was:

No prior involvement: Did you previously handle a non-CDP case (including EH cases) on this taxpayer for the same tax and tax period? If so, document that you obtained a Form 14041 waiver. IRC 6320(b)(3) and 6330(b)(3) require the hearing to be conducted by an employee with no prior involvement with respect to the unpaid tax. Prior involvement includes participation in a matter (other than a prior CDP hearing) that the taxpayer may have had with respect to the taxes shown on the CDP notice.

This section is for discussing all nonfrivolous issues raised on Form 12153 and in the hearing. The table below highlights the issues a taxpayer might raise and what to discuss:

If the taxpayer's arguments and/or collection alternatives were rejected, why were they rejected? Explain in sufficient detail why your determination was correct based on the facts before you.

When an ASFR/SFR liability was raised by the taxpayer, document the following under Issues Raised or on the Form 12257:

When an ASFR/SFR liability was raised by the taxpayer but precluded, document the following under Issues Raised or on the Form 12257:

If the taxpayer raised frivolous issues, do not discuss them. Instead, note that Appeals does not consider frivolous issues.

In the balancing section, explain whether the proposed collection action balances the need for efficient collection of taxes with the legitimate concern of the taxpayer that any collection action be no more intrusive than necessary. Balancing is tied to the taxpayer's:

Balancing must be done even if the only issue raised is liability.

When the taxpayer is unresponsive or proposes no collection alternatives, the levy proposed or Notice of Federal Tax Lien is generally sustained.

When the Notice of Intent to Levy was properly issued but you subsequently agree to a collection alternative, state so.

When the Notice of Federal Tax Lien is sustained.

When you are assigned a remand, the file generally arrived directly from Counsel. Send a secure email to APS requesting:

Ask the taxpayer if they received a copy of Counsel’s memorandum to Appeals regarding the remand. Provide a copy if they have not received one.

Complete the requirements in Counsel's Remand memo including making contact with Counsel by the specified due dates.

When the Tax Court remands a CDP for consideration of an OIC that was not submitted in the initial hearing, the hearing officer will card in and consider the new OIC.

If the offer is accepted, the hearing officer prepares the acceptance paperwork. The offer cannot be processed until the Status 72 is reversed so send Counsel the entire accepted offer file along with the supplemental NOD, making sure that Counsel understands it has the original offer and that Counsel must direct APS to process the accepted offer.

When the Tax Court remands a CDP for reconsideration of an OIC, the hearing officer will reconsider the original offer. The taxpayer will not be asked to submit a new OIC, pay a new application fee or make a new TIPRA payment. However, if the offer amount is increased, the taxpayer must make an additional payment of 20% of the increase.

The original rejection of the offer in the CDP hearing tolls the TIPRA statute under IRC 7122(f) even if the court holds the rejection was erroneous.

Once the supplemental hearing is concluded:

Submit to your ATM at closing:

The remand file is returned to APS after the ATM review. APS issues the supplemental NOD and puts the case back into PART 3. Then APS sends the file back to Counsel.

After the Supplemental NOD is issued, the jurisdiction of the case remains with the Tax Court. The Supplemental NOD is not a new determination and does not provide the taxpayer with additional judicial appeal rights.

The taxpayer is not required to re-petition the Tax Court if they disagree with the Supplemental NOD.