After Letter 1153(DO) and Form 2751, Proposed Assessment of Trust Fund Recovery Penalty, have been properly delivered (IRM 5.7.4.7, Notification of Proposed Assessment), the responsible party has 60 days (75 if the letter was addressed outside of the United States) from the date of the mailing of the notice or the date of personal delivery to respond.

In determining the timeliness of the appeal, the guidelines in IRC 7503 should be followed which state in part:

Allow an additional 5 days beyond the response period allowed in the Letter 1153(DO) to enable the IRS to receive and process all timely mailed requests.

The responsible party can take the following actions in response to Letter 1153(DO):

The ATFR application will not allow you to proceed until one of the following actions occurs:

In all cases regardless of the taxpayer’s action, the revenue officer will complete TFRP (Trust Fund Recovery Penalty) processing and forward the case to Control Point Monitoring (CPM), Advisory not later than 30 calendar days after the required response period allowed in the Letter 1153 (DO), (60 days after the date the Letter 1153 (DO) was mailed or personally delivered, 75 days if the letter was addressed outside of the United States). In the event an employee is unable to meet the 30-day time period, he/she shall document the reason for the delay in the ICS history.

If the taxpayer agrees to the assessment by signing Form 2751, prepare Letter 1155(DO), Notice of Agreed Trust Fund Recovery Penalty, and deliver the letter to the responsible person no later than 14 calendar days after receipt of the signed Form 2751. Prepare the letter using the ATFR application whenever possible. Document the case file with an explanation if Letter 1155(DO) is delivered more than 14 days after receipt of the signed Form 2751.

Input the date the Form 2751 was signed onto the ATFR application.

For regular assessments, follow the procedures in IRM 5.7.6.2, Revenue Officer Assessment Actions, for requesting assessment of the TFRP. For cases requiring quick or prompt assessment action, follow the procedures in IRM 5.7.6.3, Quick and Prompt Assessment Actions.

Unless the responsible person has filed bankruptcy, request full payment from the responsible person when he or she agrees to the assessment by signing Form 2751.

Follow the procedures in IRM 5.7.7.2, Pre-Assessment Payment, for processing payments received from the responsible party prior to the actual assessment of the TFRP.

If the taxpayer is unable to full pay the proposed assessment, follow the instructions in IRM 5.15.1, Financial Analysis Handbook, to determine the appropriate case resolution based on an analysis of the taxpayer's financial condition. This may include the following:

Revenue officers must make a Notice of Federal Tax Lien (NFTL) filing determination in accordance with the policy and procedures in IRM 5.12.2, Notice of Lien Determinations, prior to taking the closing actions above.

To ensure the continuity of collection actions, if the TFRP account is not resolved (pre-assessed CNC or IA, full pay, etc.) the revenue officer should request assignment of the TFRP assessment as an ICS case and make a NFTL filing determination in accordance with the policy and procedures in IRM 5.12.2, Notice of Lien Determinations. It may be appropriate for a revenue officer to request assignment of a TFRP assessment even if the taxpayer resides outside the revenue officers groups’ geographic area. If personal contact was established with the taxpayer (even if by telephone) to conduct a Form 4180 interview and to secure financial information as required by IRM 5.7.5, Collectibility Determination, the revenue officer can continue to work with the taxpayer to resolve the account. If field contact will be required to resolve the case, the revenue officer can either issue ICS Other Investigations or transfer the case.

Letter 1153(DO) advises the responsible party of his or her appeal rights. The form the appeal must take is based on the dollar amount of the proposed assessment.

Letter 1153(DO) also advises the responsible party they may contact the revenue officer within ten days of the Letter 1153(DO) if:

TFRP cases are also eligible for Fast Track Mediation (FTM). This program is designed to expedite case resolution since the entire process normally takes 30-40 days to complete. Additional information can be found in Publication 3605, Fast Track Mediation - A Process for Prompt Resolution of Tax Issues. Publication 3605 should be provided to the taxpayer to explain the FTM process.

The ASED is only extended for cases where the taxpayer files a proper appeal within the allowable time period; FTM has no impact on the ASED or the regular appeals procedures. Advise the taxpayer even if they choose FTM, they must continue to follow the procedures in Letter 1153(DO) by filing the appropriate request within 60 days of issuance of the Letter 1153(DO) if they wish to have the case considered by the Appeals office in case the FTM is not resolved in their favor.

Both the taxpayer and the revenue officer must agree to mediate. The taxpayer must have completed a Form 4180, Report of Interview with Individual Relative to Trust Fund Recovery Penalty or Personal Liability for Excise Tax, and supplied all requested back-up documentation related to the trust fund recovery penalty investigation. To initiate the FTM process, the revenue officer will complete a Form 13369, Agreement to Mediate, and a brief summary of issues in memorandum form and forward the documents to Appeals within three days of securing the taxpayer's signature.

If the parties do not reach an agreement, then the case will be forwarded to Appeals through CPM if the taxpayer followed the instructions in Letter 1153(DO) regarding the formal appeal process. The case will then be assigned to a different Appeals officer. If the taxpayer did not follow the formal appeal process, the case should be forwarded for assessment. The taxpayer may still file a claim for refund after assessment if appropriate payment has been made.

If the revenue officer agrees with the information submitted informally or if the parties reach an agreement through the mediation process, then the revenue officer should change the determination by following the procedures in IRM 5.7.6.1.7, Revenue Officer Agrees With Protest.

If the revenue officer does not change the determination based on the information submitted informally, he or she should advise the taxpayer to follow the formal protest procedures outlined in Letter 1153(DO) in order to protect his/her appeal rights.

If the amount of tax liability proposed for the period is:

IRM 5.7.6.1.4, Small Case Request, contains the guidelines on the information the taxpayer should include in a Small Case Request. IRM 5.7.6.1.5, Formal Written Protest, contains the information the taxpayer should include in a Formal Written Protest. The responsible party should submit any additional information or documentation he or she wants the Settlement Officer/Appeals Officer to consider.

The potentially responsible party should submit a Small Case Request in duplicate and should include:

The potentially responsible party should submit a Formal Written Protest in duplicate and should include:

If an authorized representative (Form 2848, Power of Attorney and Declaration of Representative, or a properly written power of attorney or authorization is acceptable) prepares and signs the protest for the responsible party, he or she must substitute a declaration stating:

If the responsible party responds to Letter 1153(DO) within the appropriate time frames (see IRM 5.7.3.6.2, Impact of Letter 1153(DO) on Assessment Statute, and IRM 5.7.6.1.1(1), Taxpayer's Response to Letter 1153(DO)), review the request within 10 days of receipt to determine if the information is complete as discussed in IRM 5.7.6.1.4, Small Case Request, or IRM 5.7.6.1.5, Formal Written Protest.

If the information in the protest is incomplete, contact the taxpayer/representative to inform him/her that any defects in the protest should be corrected. If the responsible party does not provide a perfected protest prior to the end of the 30-day period to complete TFRP processing and forward the case to CPM, the revenue officer should still follow the procedures in IRM 5.7.6.1.8, Revenue Officer Disagrees With Protest. Appeals will accept jurisdiction of a TFRP protest even if all information as outlined in IRM 5.7.6.1.4, Small Case Request, or IRM 5.7.6.1.5, Formal Written Protest, is not included in the protest.

The responsible party is not entitled to appeal the proposed TFRP if he/she did not file a timely protest. Refer to instructions contained in IRM 5.7.6.1.1, Taxpayer's Response to Letter 1153(DO), to determine whether the protest is timely. If the taxpayer’s protest is untimely, the employee handling the proposed TFRP assessment will:

Ensure the correct Protest Postmark Date has been entered on ATFR. CPM will not review protest files to verify the timeliness of protests or the Protest Postmark Dates input by the RO.

If the information the responsible party submits changes the revenue officer's determination on the case, the revenue officer may concede the case in whole or in part. See IRM 5.7.6.1.8, Revenue Officer Disagrees With Protest, for the procedures to follow if the revenue officer does not change his or her determination based on the information submitted with the protest.

To make the appropriate change on Form 4183, Recommendation re: Trust Fund Recovery Penalty Assessment, input the protest postmark date on ATFR and change the responsibility to partial or none for each period. The TFRP should then be re-calculated and the applicable forms updated. Group manager approval must be secured on an amended Form 4183.

When the decision is made to reverse all or a portion of the periods on Letter 1153(DO), the revenue officer will take the following actions:

If a responsible party protests the entire assessment and:

If the taxpayer is only protesting part of the assessment and the revenue officer agrees with the information submitted, the revenue officer will make the changes on Form 4183 as indicated in IRM 5.7.6.1.7(2), Revenue Officer Agrees With Protest, issue Letter 1153W for the tax periods being conceded, and attempt to secure the taxpayer's signature on the updated Form 2751.

If the information the responsible party submits does not change the revenue officer's determination on the case, or if the responsible party protests the entire assessment and the revenue officer only concedes the case in part, the revenue officer will:

Upon receipt of the TFRP case file, the group manager will take the following actions:

After group manager approval, the revenue officer will take the following actions:

The administrative TFRP case file transmitted to Appeals is not an ex parte communication since it sets forth the boundaries of the dispute between the taxpayer and the Internal Revenue Service and forms the basis for Appeals to assume jurisdiction. The TFRP case file should include all information supporting the original recommendation, as well as any work papers reflecting the manner in which payments have been applied, specifically any payments directed by the taxpayer, court order, etc.

Upon receipt of the TFRP package, CPM will conduct a technical review of the case file, and if it is complete and acceptable, will forward it to Appeals. (See IRM 5.7.6.1.9, Transmittal of Case to Appeals)

Letter 1153W cannot be issued after a protest has been forwarded to Appeals.

There may be rare instances, after a protest has been sent to Appeals, when Collection will secure significant new information that needs to be provided to Appeals to allow Appeals to fully evaluate the protest. In these rare instances, supplemental information can be provided to Appeals as long as Collection concurrently provides the same information (copy of the written communication sent to Appeals) to the taxpayer/representative. Appeals will give the taxpayer/representative the chance to respond to the supplemental information.

It is FC’s responsibility to ensure all necessary documents, including the ATFR and ICS case histories are contained in the TFRP case file and the protest was received timely. CPM will not review TFRP protest files for timeliness or completeness. TFRP protest case files must be assembled with Document 9708, Trust Fund Recovery Penalty Case File Tabs (Appeals Cases). This will ensure CPM can easily identify all protest cases.Each protesting responsible party file must contain all required documentation to support assessment.If a responsible party file was a“Supplemental” case file ensure all pertinent documents from the “Key” case file are copied to the protest file.See IRM Exhibit 5.7.6-1, TFRP Case File Check Sheet, to assist in case accuracy and completeness.

Group managers must complete and sign the TFRP Case File Check Sheet.

Submit related cases (two or more responsible persons for the same corporation) together whenever possible.

Each territory should establish a system for reviewing decisions made by Appeals to determine whether quality issues exist that need to be addressed. The territory should arrange periodic meetings with Appeals to discuss trends, workloads and other issues of interest. CPM may also establish a process to follow-up on overage Appeals cases.

Appeals may request additional information after receipt of a TFRP protest. An Appeals hearing officer may determine new information submitted by a potentially responsible party requires investigative analysis. In this situation, Appeals will retain jurisdiction of the case and forward the new information request via Form 10467, Appeals Division Feedback Report and Transmittal Memorandum, to the originating CPM group for processing. The CPM should consult with an advisor and if it is determined additional investigative analysis by a revenue officer is necessary, CPM will follow guidance in IRM 5.1.8.5.1, Types of Mandatory OIs, to issue an OI to Field Collection. The information should be provided within 45 calendar days of the request. This date may be extended by mutual agreement. These situations should be highly uncommon. To avoid ex parte communications, Appeals has the responsibility for informing the potentially responsible party that the information was sent to Field Collection for investigation, sharing Field Collection’s response with the potentially responsible party and allowing the potentially responsible party time to comment.

Once a final determination has been made, Appeals will:

CPM will update ATFR with the date the case was returned from Appeals and the decision (i.e., No change, Partial Change, or Not Responsible) made by Appeals. CPM will also make an ICS history entry with the same information and note when ATFR was updated.

If Appeals does not sustain the original proposed assessment, a new Form 2749 must be printed to reflect the correct TFRP amount based on the decision by Appeals.

CPM will be responsible for completing any necessary quick assessment action (IRM 5.7.6.3, Quick and Prompt Assessment Actions) and ensuring the ASED is protected on these Appeals cases.

For fax requests, the initiating office will fax the following information to the Ogden Manual Assessment Unit:

Upon receipt, the Ogden Manual Assessment Unit will process the request and fax the Form 3210 to the initiator and provide the 23–C date and the DLN.

After receiving the documents from the initiator and making the assessment, the Ogden Manual Assessment Unit will send a copy of Form 2749 (with the DLN and 23–C date entered) and Form 3552 to the TFRP unit in CSCO for input of the appropriate cross referencing and UNLCE information.