5.7.1 FTD Alerts

Manual Transmittal

May 10, 2017

Purpose

(1) This transmits updated IRM 5.7.1, Collecting Process, Trust Fund Compliance Handbook, FTD (Federal Tax Deposit) Alerts.

Material Changes

(1) IRM 5.7.1.1 Added Program Scope and Objectives

(2) IRM 5.7.1.1.1 Added Background

(3) IRM 5.7.1.1.2 Added Authority

(4) IRM 5.7.1.1.3 Added Responsibilities

(5) IRM 5.7.1.1.4 Added Program Management and Review

(6) IRM 5.7.1.1.5 Added Program Controls

(7) IRM 5.7.1.1.6 Added Terms/Definitions/Acronyms

(8) IRM 5.7.1.2 Added Alert X

(9) IRM 5.7.1.3 Deleted paragraph one

(10) IRM 5.7.1.4 Deleted paragraph four

(11) IRM 5.7.1.5 Expanded Pre-contact IDRS Research and Analysis Section

(12) IRM 5.7.1.5 (1)(a)(b) Added examples of what to review on IDRS

(13) IRM 5.7.1.5 (1)(c) Added L5664, FTD Alert Field Contact Letter

(14) IRM 5.7.1.5 (1)(d) Added reference to POA

(15) IRM 5.7.1.5 (1)(e) Added concerns to address with taxpayer during initial contact

(16) IRM 5.7.1.5 (2) Added examples of closure options

(17) IRM 5.7.1.5 (2)(e) Removed reference to IRM 5.2.1.8.1 and Added IQA request.

(18) IRM 5.7.1.6 (3) Change made to make initial contact at the taxpayer’s place of business

(19) Added Interim Guidance SBSE-05-0216-0009 material

(20) Added Interim Guidance SBSE-05-0616-0033 material

(21) Added Interim Guidance SBSE-05-0716-0035 material

(22) IRM 5.7.1.6 (9) Added reference to L5857, FTD Alert Telephone Contact Letter

(23) IRM 5.7.1.6(10) Added L5857 is not required on initial contact made in the field.

(24) IRM 5.7.1.6 (11) Added a table to illustrate how to complete table on L5857

(25) IRM 5.7.1.6 (12) Added explanation on how to complete table on L5857

(26) IRM 5.7.1.6 (13) Added the table will help the taxpayer understand the decrease in deposits

(27) IRM 5.7.1.6 (17) Added Note

(28) IRM 5.7.1.6 (18) Added reference to provide Form 2246, Field Contact Card

(29) IRM 5.7.1.6 (19) Added Note

(30) IRM 5.7.1.7 (3) Added information regarding third party contacts

(31) IRM 5.7.1.7 (4) Added discussing consequences on untimely deposits

(32) IRM 5.7.1.7 (4) Added TBOR

(33) IRM 5.7.1.8 (2) Moved from IRM 5.7.1.9 (2) to IRM 5.7.1.8 (2)

(34) IRM 5.7.1.8 (3) Changed to state if its in the best interest of the government to prompt assess

(35) IRM 5.7.1.8 (7) Added how to proceed if TP is unable to locate

(36) IRM 5.7.1.8 (8) Added how to proceed if TP is OOB with deposits on the module

(37) IRM 5.7.1.8 (9)(10)Consider possible solutions for unfiled returns

(38) IRM 5.7.1.8 (11) Added how to proceed if RO determines not to pursue unfiled returns

(39) IRM 5.7.1.9 (3) Added STATUP request

(40) IRM 5.7.1.9 (5) Added the only way to open a ICS only Bal Due on the FTD Alert module is to close the FTD Alert first

(41) IRM 5.7.1.9 (9) Added Note - Return Secured is no longer a closing option

(42) IRM 5.7.1.9 (9)(d)(e) Added clarification to all the closing options

(43) Editorial changes were made throughout the document.

Effect on Other Documents

This material supersedes IRM 5.7.1, dated November 29, 2012. This IRM incorporates Interim Guidance Memorandum SBSE-05-0216-0009, FTD Alert Contact Procedures, dated 02/23/2016. This IRM incorporates Interim Guidance Memorandum SBSE-05-0616-0033, FTD Alert Procedures, dated 06/29/2016. This IRM incorporates Interim Guidance Memorandum SBSE-05-0716-0035, FTD Alert Telephone Contact Procedures, dated 07/11/2016.

Audience

The intended audience is revenue officers in SBSE Field Collection.

Effective Date

(05-10-2017)

Signed by
Kristen E. Bailey
Director, Collection Policy
Small Business/Self-Employed

Program Scope and Objectives

  1. This IRM provides IRS guidance on processes and procedures when working Federal Tax Deposit (FTD) Alerts.

  2. Purpose: This chapter provides guidance when working Federal Tax Deposit (FTD) Alerts.

  3. Audience: Revenue Officers in Field Collection are the primary users of this IRM.

  4. Policy Owner: Director of Collection Policy owns the policies contained herein.

  5. Program Owner: Collection Policy - Employment Tax is responsible for the administration, procedures, and updates related to this program.

  6. Primary Stakeholders: Field Collection Revenue Officers and Group Managers are impacted by these procedures and have input regarding these procedures.

  7. Program Goals: Federal Tax Deposit (FTD) Alerts are used to determine an employer's compliance with employment tax deposit requirements for the quarter of the Alert issuance, and for subsequent quarters until the taxpayer is brought into full compliance. The FTD Alert process identifies, at an early stage (i.e., before the return is due), taxpayers who have fallen behind in their deposits.

Background

  1. The FTD Alert Program is the only Collection tool available that identifies anomalies in an employer’s pattern of payroll tax deposits. Using this tool to anticipate deposits that are missed allows Field Collection the opportunity to interact with the taxpayer and proactively address potential problems as they develop, but before the amount owed exceeds the taxpayer’s ability to pay.

Authority

  1. The authorities for these policies are:

    • Congress mandated that IRS establish a system of making deposits by electronic fund transfer in order to expedite the collection of depository taxes. See IRC 6302(h)(1)(A)Establishment of system.

    • Congress has provided special procedures for the collection of depository taxes held in a special fund in trust for the United States. See IRC 7501(a).

    • Fairness Statement: IDS prioritization ensures fairness and integrity through using an equitable process for all taxpayers by using systemic scoring and routing mechanisms to ensure no one individual can control the enforcement selection decision making process which aligns with Policy Statement P- 1- 236.

Responsibilities

  1. Revenue Officers are responsible for reading and implementing the procedures listed in this IRM.

  2. Group Managers are responsible for reading and assigning FTD Alerts timely.

  3. The Senior Program Analyst is responsible for establishing the policy, procedures, standards and controls relating to the FTD Program.

  4. Employment Tax is responsible for ensuring compliance with policy and procedures regarding the FTD Program.

  5. The Director, Collection Policy is responsible for approving the official policy, procedures and completed IRM associated with the FTD Program.

Program Management and Review

  1. Program Reports: FTD Alert Reports are located on the Control D database. Form 5081 must be completed to obtain access to the Control D database. These reports provide the monthly activity regarding FTD Alert issuances, open FTD Alerts and FTD Alert closures.

  2. Program Effectiveness: The annual FTD Alert work plan volume is determined by Field Collection.

Program Controls

  1. FTD Alerts (A/B) are sent directly from Master File to the Integrated Collection System (ICS) for direct assignment to the Field.

  2. FTD Alerts (X) are created using data acquired from the Collection Data Warehouse (CDW) that is sent to ICS for direct assignment to the Field.

Terms/Definitions/Acronyms

  1. The tables below provides a list of defined terms and abbreviations used throughout this IRM Section.

  2. Defined terms are as follows:

    Defined Terms

    Word Definition Example of using a word that is open to interpretation
    Fair Provide accurate and professional service to all persons without regard to personal bias. Treat the customer in a fair, polite and courteous manner when working FTD Alerts.
    Timely - Group Manager Group Managers are to ensure FTD Alerts are assigned to ROs within seven calendar days of receipt Assignment to RO is considered timely when conducted within 7 calendar days.
    Timely - Revenue Officer The RO is to contact the taxpayer with 15 Calendar days of assignment of the FTD Alert. Initial contact is considered timely when made within 15 calendar days.


    Acronyms

    Acronym Definition
    ACS Automated Collection Systems
    BMFOLR Business Master File Return Information
    BMFOLU Business Master File CAWR Response Screen
    BMFOLK Business Master File Look back Information
    BMFOLI Business Master File Summary Response
    CDW Collection Data Warehouse
    CFINK Centralized Authorization File Inquiry
    FTD Federal Tax Deposits
    ICS Integrated Collection System
    IDRS Integrated Data Retrieval System
    IQA ICS/ENTITY Quality Analyst
    NFTL Notice of Federal Tax Lien
    OOB Out of Business
    PEO Professional Employer Organization
    POA Power of Attorney
    PSP Payroll Service Provider
    RA Reporting Agent
    RO Revenue Officer
    STAUP Suppressing Balance Due Notices
    TBOR Taxpayer Bill Of Rights
    TC Transaction Code
    TFRP Trust Fund Recovery Penalty
    TPP Third Party Payer


Criteria for FTD Alert Issuance

  1. FTD Alerts are issued on taxpayers who are classified as semiweekly depositors and who have not made FTDs during the current quarter or who have made them in substantially reduced amounts. They may be identified by the presence of TC 971 AC 046 on a tax module.

  2. The selection model analyzes past compliance history and current deposit patterns to identify taxpayers who are least likely to self-correct their tax deposit issues.

  3. There are three types of Alert issuances that are assigned for field contact. They are identified by the following systemically generated codes:

    • Potential Pyramider, identified by an Alert priority code of "A" . The taxpayer had modules in notice status in each of the prior two quarters.

    • Potential Noncompliant, identified by an Alert priority code of "B" . The taxpayer is considered to be likely to owe without intervention based on our identification and selection process.

    • Potentially At Risk, identified by an Alert priority code of "X" . The taxpayer is considered at risk of falling behind on their FTDs in the current quarter.

  4. The FTD Alert priority code will be present on the ICS FTD Alert Case Summary Screen.

Process for Alert Issuance

  1. Master File conducts the FTD Alert analysis in the twelfth cycle week of each calendar quarter. The FTD Alerts generate in the thirteenth week of each calendar quarter, in the months of March, June, September, and December.

Receipt of FTD Alerts

  1. Revenue Officer inventories should be at a level that will allow for the immediate assignment of the Alerts; however, under no circumstances should the assignment date exceed seven calendar days from the date the Alert arrives in the group designation hold file.

  2. Ensure the case sub code is listed as FTD Alert 105, per IRM 5.2.1.8.1, Field Collection Procedures and IRM 5.2.1.10(2),ICS and Entity Subcodes ( Field Collection Area only). If the sub code is not listed as 105, immediately update ICS. FTD Alert sub codes are automatically changed by ICS when the FTD module closes, see IRM 5.2.1.10(5).

Pre-Contact Research and Analysis

  1. Pre-contact analysis must be conducted on all Alerts prior to making contact on the FTD Alert.

    1. Review IDRS, as appropriate. Consider researching the following: (not all inclusive)
      BMFOLR - Monthly Tax Liabilities
      BMFOLU - All wages reported on Form 941, W-2 & W-3. This information can assist with identifying W-3 discrepancies and facts to assist with preparing unfiled returns
      BMFOLK - Type of Depositor
      BMFOLI - Verify Compliance History
      Review Cross Compliance
      CFINK - Determine if the taxpayer has a representative
      Review Prior TFRP assessments

    2. Review taxpayer account for:
      Prior quarter deposits made
      Same quarter prior year tax due on the return
      Prior assessed FTD penalties

    3. Prepare Letter 5664, FTD Alert Field Contact Letter. L5664 will assist the Revenue Officer in explaining the purpose of the visit and will help explain to the taxpayer the costs associated with making late deposits.

    4. If the taxpayer has a representative or POA on file and all open periods, including the FTD Alert module are not reflected on Form 2848 or Form 8821, prepare to contact the taxpayer to secure an up-to-date form per IRM 5.1.10.7.2(3), Right to Representation. IRM 5.7.1.6Contact Procedures for additional information regarding contacting POA.

      Note:

      Form 8821 permits the appointee to receive confidential tax information for the purpose of assistance with a tax matter with the IRS. Form 8821 does not authorize a person to represent a taxpayer before the IRS: e.g., the appointee cannot negotiate with the IRS on behalf of the taxpayer or advocate the taxpayer’s position to IRS.

    5. Decide what issues to address during the initial contact with the taxpayer. Examples of issues to consider:
      Is the business current with FTDs?
      Why did the FTDs decrease?
      Is the business seasonal?
      Are the officers of the corporation in compliance?
      Does the taxpayer have a history of non-compliance?

  2. If pre-contact research and analysis reveals:

    1. The taxpayer is no longer required to deposit employment taxes or file employment tax returns, verify final return information is posted on IDRS and close the Alert as Not Required to Deposit. If you suspect the business is "out of business" , and the final return information has not posted to IDRS, work the Alert to verify status of the business before closing the FTD Alert.

    2. The taxpayer is not liable for deposits for the Alert quarter, make the field call to verify the deposit frequency, then close the Alert as Not Required to Deposit. Remember to input TC 590:50 for the FTD Alert module only. The taxpayer may be liable for future quarter employment tax.

    3. The taxpayer is in status 22 and assigned to Automated Collection Systems (ACS), the RO needs to contact the ACS Support Liaison for the corresponding call site to request case transfer. Per IRM 5.3.1.2.2, ACS contact information for this purpose can be found at SERP under the Who/Where tab, ACS Liaisons: ACS Support and Status 22 TAS Liaisons., ACS Support and Status 22 TAS Liaisons. Once the transfer/assignment request has been submitted, close the Alert as TDA/TDI Received and create a ICS only Bal Due module on ICS. Continue to work the entire case.

    4. The taxpayer is in bankruptcy, inform Insolvency of the FTD Alert and determine if Insolvency is monitoring the taxpayer’s compliance. If Insolvency is monitoring compliance, request input of TC 136, if it has not already been input and close the Alert. A TC 136 prevents future Alerts from generating. It is reversed with a TC 137. If Insolvency is not monitoring the taxpayer's compliance, continue working the Alert. Do not, however, request a collection information statement, demand payment or take any enforced collection action unless Insolvency indicates that the action will not violate the automatic stay.

      Note:

      Some of the acts prohibited under the automatic stay include: collecting debts incurred before the filing of the bankruptcy petition, as well as taking possession of, or exercising control over, property of the estate and/or attempts to create, perfect, or enforce liens against property of the estate (or against property of the debtor when the lien secures a pre-bankruptcy debt). See IRM 5.17.8.10, Automatic Stay -11 USC § 362.

    5. The new FTD Alert module received is on a taxpayer that is currently assigned to an RO and in status 26, including TDA/TDI/CIP on ICS, the RO should notify their manager. The group manager will contact the IQA representative and the FTD Alert Senior Program Analyst to request manual closure of the FTD Alert. Once IQA or the FTD Alert Analyst determines that FTD Alert module is actually in status 26, the Alert will be manually closed by IQA and the RO will not be required to work the FTD Alert. The open TDA/TDI/CIP case will be used to control the case and worked according to the existing IRM guidance.

  3. Schedule Field contact on your calendar

  4. Clearly document a plan of action

Contact Procedures

  1. Contact the taxpayer within 15 calendar days of assignment of the Alert. If timely contact is not possible, notify the group manager. The group manager will decide if reassignment of the Alert is appropriate. If contact is delayed for more than 15 calendar days, note the reason for the delay in the case history.

  2. When the taxpayer has a representative, make initial contact with the POA of record. Procedures outlined in IRM 5.1.10.3(5) and (7) and IRM 5.1.10.7.2, Right to Representation should be followed.

    Note:

    A field visit must still be made to the business address to assess the taxpayer’s operation and view the assets.

  3. Make contact with the taxpayer or taxpayer’s representative at the taxpayers place of business to discuss the FTD Alert. Making initial contact in the field allows the RO the opportunity to view the business/operation, assets, make informed decisions regarding collectability and educate the taxpayer regarding their filing and deposit requirements.

  4. Additionally, a face-to-face visit can be an effective opportunity to provide and explain the TBOR and the consequences of non-compliance, such as penalties, including the Trust Fund Recovery Penalty. Refer the taxpayer to the irs.gov website for additional information about TBOR.

  5. In those rare instances where the RO determines initial contact in the field is not possible, a telephone call is the next option for initiating contact with the taxpayer.

  6. If the initial contact with a taxpayer is not in the field, document the case history outlining the circumstances supporting this determination.

  7. If the initial contact is not at the taxpayer’s place of business, a field visit to the taxpayer’s place of business must still take place. See IRM 5.1.10.3(7). If a subsequent field contact is not practical, document the case history outlining the circumstances.

  8. If the Revenue Officer makes the initial taxpayer contact by telephone, the contact will be considered timely as long as the phone call is made within 15 calendar days from the date of receipt of the Alert.

  9. Prior to making an attempt to contact a FTD Alert taxpayer by telephone, Letter 5857, FTD Alert Telephone Contact Letter must be sent to the taxpayers address on record to inform them that a Revenue Officer will call the taxpayer by the specified date entered on the letter.

  10. Letter 5857 is not required prior to making initial contact in the field.

    Note:

    When a valid Form 2848, Power of Attorney and Declaration of Representative, or Form 8821, Tax Information Authorization , is on file for the taxpayer, mail a copy of Letter 5857 to the representative, and include Letter 937, Transmittal Letter for Power of Attorney.

  11. Complete the table at the bottom of Letter 5857. See the example below:

    Tax Quarter Tax Due on Return Deposits made Penalties assessed
    Prior Quarter 15,000.00 5,000.00 2,525.00
    Current Quarter N/A 3,500.00 N/A
  12. On Letter 5857, complete the boxes as follows:

    1. Enter the RO’s name and the specific date the RO plans to call the taxpayer in the first paragraph.

    2. Add the prior quarter date information, e.g. 06-30-2017.

    3. Add the current quarter FTD Alert module date , e.g. 09-30-2017.

    4. Enter the total tax listed (TC 150) on the prior filed return. This information will be located on IDRS.

    5. Enter the total amount of deposits made on the prior return.

    6. Enter the total amount of penalties assessed on the prior quarter.

    7. Enter the total amount of deposits made on the current quarter.

    8. Enter a convenient time for the taxpayer or representative to contact the RO.

  13. The table illustration will assist the taxpayer to understand the purpose of the phone call and assist the RO when explaining the specific decrease in deposits made and the cost associated with making late deposits.

  14. A telephone call that does not result in taxpayer contact will not meet the timely contact requirements. Leaving a message within this period is also not considered a timely contact. All attempted contacts should be documented in the case history.

  15. Follow the procedures in IRM 5.1.10.3.2 Initial Contact.

  16. Explain the reason for the visit/call. Recognize that FTD Alerts generate based on the probability that the taxpayer has fallen behind in deposit payments.

  17. Provide the taxpayer with Publication 1, Your Rights as a Taxpayer.

    Note:

    As a reminder, if the FTD Alert is a "stand alone" Alert, meaning there are no associated modules on IDRS, it’s possible that the taxpayer has not been provided with advance notice that third party contacts may be made. If efforts to reach the taxpayer directly lead to contact with a third party, the RO should not identify himself/herself or otherwise establish a connection between the IRS and the specific taxpayer. IRM 25.27.1.2(2)(m), Third-Party Contact (TPC): Definition.

  18. If the RO is not able to meet with or discuss the Alert directly with the taxpayer or POA, leave Form 2246, Field Contact Card at the taxpayer’s place of business, per IRM 5.1.10.3(8), Initial Contact.

  19. If the taxpayer provides documentation or other substantiating information confirming full compliance, verify that the amount deposited is accurate based on prior quarter deposits. The only way to verify complete compliance for the Alert quarter is to keep the FTD Alert open until the Form 941 return is secured.

    Note:

    See IRM 5.7.1.8 requires the Form 941 return for the Alert quarter be secured prior to closing the FTD Alert.

  20. If the amount of the deposits are less than prior quarters, ask additional questions regarding possible reduced payroll or wages.

  21. If the taxpayer is no longer required to deposit (e.g., out-of-business, no employees), ensure there are no other outstanding modules. Secure final return, if out of business. Promptly request input of TC 591 and close the Alert.

  22. If the taxpayer is in compliance, but due to sporadic or seasonal payrolls the Alert programming analysis is unable to predict deposit compliance, request input of TC 136. During the contact, briefly review Federal Tax Deposit requirements with the taxpayer and provide Notice 931, Deposit Requirements for Employment Taxes, or other documents outlining the deposit rules to help explain the requirements. This may help ensure the taxpayer maintains future compliance.

Taxpayer Not in Compliance

  1. FTD Alerts on delinquent taxpayers provide an early opportunity to assist and educate taxpayers before their liability pyramids and the growing debt becomes more difficult to resolve.

  2. Review Federal Tax Deposit requirements with the taxpayer. Give the taxpayer Notice 931, Deposit Requirements for Employment Taxes, Publication 15, Circular E, Employer's Tax Guide, Publication 3151-A, The ABCs of FTDs or other documents outlining the deposit rules to help explain the requirements.

  3. If the taxpayer claims to be in compliance because they use a third-party payer (payroll service provider, reporting agent, professional employer organization), secure information about the third-party arrangement and verify compliance. Explain that the employer is ultimately responsible for withholding, reporting, and paying federal employment taxes (see IRM 5.1.24.5, Collection Actions in Cases Involving Third-Party Payers). Revenue Officer questions or concerns about third-party payer issues should be directed to the appropriate Area PSP/PEO Coordinator. A list of coordinators can be found at Collection PSP/PEO Coordinators by Area.

  4. Discuss the cost for failing to make timely deposits. Explain the FTD penalty to the taxpayer. Show the taxpayer the penalties incurred in the prior quarters.

  5. Ensure that the taxpayer understands the consequences of continued noncompliance. Discuss the Notice of Federal Tax Lien (NFTL), levy and seizure provisions. When applicable, discuss the provisions for the Trust Fund Recovery Penalty (TFRP).

  6. Monitor and document the taxpayer’s compliance with deposits for the Alert quarter and subsequent quarters until the account is resolved. If the taxpayer cannot satisfy past due deposits while meeting current deposits, encourage the taxpayer to make current deposits first while working to resolve past due deposits.

  7. After contacting the taxpayer, document the case history to show FTD requirements and penalty assessment were discussed with the taxpayer. Also, document that the taxpayer was informed of the consequences of non-compliance.

  8. If the taxpayer is unable to make the required deposits, after initial contact and remain in compliance, see IRM 5.7.1.8Working FTD Alerts.

Working FTD Alerts

  1. If the taxpayer is unable to make required deposits or become compliant, at initial contact, secure a Collection Information Statement and follow the procedures listed in IRM 5.1.10.3.2 , Effective Initial Contact.

  2. Secure the 941 return for the Alert quarter. Use the appropriate closing code with TC 599 for the return secured

  3. If full payment of tax, including penalties and interest is not received with the return, determine if it is in the best interest of the government to prompt assess the return.

  4. Explain the TFRP provisions, provide Notice 784, Could you be Personally Liable for Certain Unpaid Federal Taxes? and make TFRP determination.

  5. Ensure ICS histories are clearly documented. See IRM 5.1.10.8, Case Histories.

  6. Ensure timely follow-ups are met. See IRM 5.1.10.9, Timely Follow-ups.

  7. If the FTD Alert is assigned with no related Bal Due and the RO is unable to locate the taxpayer during the field call to the FTD Alert address, all available internal and external locator sources should be exhausted in an effort to locate the taxpayer.

  8. If the RO determines the business is OOB, then the FTD Alert can be closed as Not Required to Deposit.

  9. If there are deposits made on the module and the RO determines the business is OOB, the RO must make an effort to secure the FTD Alert module 941 return before closing the FTD Alert.

  10. Consider all possible resolutions for the unfiled FTD Alert return on a case-by-case basis.

  11. If the RO determines that enforcement should not be pursued for the unfiled 941 return for the FTD Alert module, close the FTD Alert as "Bal Due/Due Ret Received," open an ICS only Del Ret and follow the procedures in IRM 5.1.11.6.1, Enforcement Determination, to close the Del Ret.

Alert Closing Procedures

  1. Close the Alert when the taxpayer is brought into full compliance. Full compliance includes, filing of all tax returns on or before the required due date; making appropriate tax deposits in the proper amount, by the appropriate due date; and paying any tax due with the return at the time the return is filed.

  2. If the taxpayer is not in compliance and there is a Bal Due, or Del Ret open on IDRS, request assignment of the case.

  3. Once the STAUP request has been submitted, close the FTD Alert as "Bal Due/Del Ret Received" and create a ICS Only Bal Due or Del Ret on ICS to control the case and continue working the entire case.

  4. If a Bal Due or Del Ret is received on the FTD Alert module, prior to requesting assignment, the FTD Alert will systemically close and will be assigned to the RO.

  5. The only way to open a ICS Only Bal Due or Del Ret on the FTD Alert module is to close the FTD Alert first.

  6. The following ICS options are available to close an FTD Alert:

    1. TP is in Compliance: The taxpayer is required to make deposits and is current with payment and filing requirements at the time of initial contact on the Alert.

    2. Not Required to Deposit: The taxpayer was not required to deposit for the specific FTD Alert quarter.

    3. TP is Sporadic/Seasonal: The taxpayer is either a sporadic or seasonal employer with a fluctuating payroll. If the Alert programming analysis would be unable to predict the taxpayer's deposit compliance, the revenue officer should manually request input of TC 136 to suppress future Alerts when closing the FTD Alert.

    4. Brought into Compliance: The revenue officer brought the taxpayer into compliance on all required deposits and secured the return for the FTD Alert quarter. The taxpayer is now fully current on the Alert and current quarter at the time the Alert is ready for closure, and there are no additional balances owed, including penalties and interest.

    5. Bal Due/Del Ret Received: The revenue officer received another ICS module by which to control the case. FTD Alerts should be closed when there is an open Bal Due or Del Ret on ICS.

      Note:

      If another module is listed on IDRS in various statuses for the same taxpayer, use appropriate procedures to request assignment. Once the STATUP request has been submitted, close the FTD Alert, create a ICS only Bal Due module on ICS and continue working the Bal Due according to current procedures.

      Note:

      Return Secured is no longer available as a closure option on ICS. If the RO secures a balance due in the field, first attempt to secure full payment, including penalties and interest. If a balance due return is secured without full payment, determine if it is in the best interest of the government to prompt assess the return. The RO should close the FTD Alert using closing option, Bal Due/Del Ret Received, create a pre-assessed or prompt assess Bal Due on ICS and continue to pursue collection. The pre-assessed/prompt assessed ICS Only Bal Due will be used to control the case in inventory until the module is assigned to the RO.

  7. If a new FTD Alert is issued while an FTD Alert from a prior quarter is still open in inventory, the old Alert will be systemically closed and replaced with the new Alert.

Transfer of FTD Alerts

  1. If the taxpayer is in another area, the FTD Alert can be transferred without a prior Courtesy Investigation.

  2. Due to the time-sensitive nature of FTD Alert contacts, call and advise the receiving office of the transfer.

  3. Transfer FTD Alerts only if the business itself, not merely one or more officers or partners, is located in the transferee area.