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Part 5. Collecting Process

Chapter 1. General Collecting Procedures

Section 12. Cases Requiring Special Handling

5.1.12  Cases Requiring Special Handling

5.1.12.1  (05-20-2008)
Cases Requiring Special Handling - Overview

  1. This IRM provides instructions and guidelines for working cases which require special handling. The procedures are written specifically for revenue officers due to the complex nature of the collection cases assigned to them. Other employees in SB/SE and employees in other functions may also refer to these procedures.

  2. Follow the appropriate procedures when you are working the specific type of case shown below:

    • Identity Theft

    • Disaster/Emergency Relief

    • Taxpayer Request to Record an In-Person Interview

    • Authorized IRS e-file Provider

    • Income Tax Assessed Against a Child,

    • Household or Agricultural Employee

    • High Assault Risk Area (HARA)

    • "Innocent Spouse"

    • Non-Petitioning Spouse

    • Child Support Obligation (CSO)

    • Taxpayers Exempt from Taxation for Religious Reasons

    • Insolvent Financial Institutions — Provisions of the IRS-RTC/FDIC Agreement

    • Foreign Insurance Company

    • Political Activity

    • Criminal Probation

    • Math or Clerical Error

    • Non-Receipt of Refund Check

    • False Refund Claim

    • Refund Offset

    • U.S. Tax Court Subpoena

    • Backup Withholding

    • Indian Tribal Governments

    • Mutual Collection Assistance Request (MCAR)

    • Treasury Enforcement Communications System

    • Certain Wrongful Levy Situations

    • Courtesy Investigations

  3. Refer to IRM 5.11, Notice of Levy, for guidance on certain wrongful levy situations.

  4. Refer to IRM 5.1.8.7, Courtesy Investigations Requiring Special Handling, for guidance on Courtesy Investigations which require special handling.

5.1.12.2  (05-20-2008)
Identity Theft

  1. IRS operations have an effect on victims of identity (ID) theft, such as resolving duplicate returns or engaging in various compliance activities that target unreported income. When these situations occur, the innocent taxpayer must provide the IRS documentation to establish that he or she is a victim of ID theft. Inconsistent documentation standards may cause unnecessary burden on taxpayers attempting to resolve adverse tax situations caused by ID theft.

  2. The IRS has established the Identity Theft and Incident Management office responsible for an agency-wide Enterprise Strategy comprised of three components — outreach, victim assistance, and prevention. Click on this link for general information about ID theft: http://irweb.irs.gov/Privacy/pip/itim/idtheft.html

  3. To reduce the burden on taxpayers, the IRS has established standard documentation requirements for resolving cases that involve ID theft.

  4. This IRM provides procedures for working with taxpayers who are victims of ID theft, working with taxpayers who perform ID theft, and handling security breach incidents.

5.1.12.2.1  (05-20-2008)
Standard Identity Theft Documentation Requirements

  1. Request documentation to establish that the taxpayer was a victim of ID theft when a taxpayer alleges that he or she was a victim of ID theft.

  2. Request the following documentation to establish that the taxpayer was a victim of ID theft:

    • Authentication of identity, and

    • Evidence of lD theft.

5.1.12.2.1.1  (05-20-2008)
Substantiation Documentation

  1. Substantiation documentation must be legible and accurately associated with the correct taxpayer.

  2. Collect substantiation documentation in a timely, accurate, and secure manner.

  3. Apply stringent safeguards when storing and retaining substantiation documentation. Store the substantiation documentation along with the case file.

  4. Secure and handle substantiation documentation and information in the same manner as other sensitive taxpayer personal information.

5.1.12.2.1.1.1  (05-20-2008)
Who Can Substantiate ID Theft?

  1. Accept substantiation documentation from the taxpayer or someone who has power of attorney for the taxpayer per Form 2848 .

5.1.12.2.1.2  (05-20-2008)
Authentication of ldentity

  1. Secure a copy of a valid U.S. federal or state government-issued form of identification to authenticate identity.

    Example:

    Driver's license, State Identification Card, Social Security Card, Passport, etc.

5.1.12.2.1.3  (05-20-2008)
Evidence of ldentity Theft

  1. Secure a copy of one of the following as evidence of ID theft:

    • Police Report, or

    • Affidavit of ldentity Theft (available from the Federal Trade Commission).

5.1.12.2.2  (05-20-2008)
Identity Theft Case Resolution

  1. Resolve the case in an appropriate manner according to the following procedures depending on whether the taxpayer:

    1. establishes he/she was a victim of ID Theft,

    2. does not establish he/she was a victim of ID theft, or

    3. performed ID theft.

5.1.12.2.2.1  (05-20-2008)
Taxpayer is a Victim of ID Theft

  1. Resolve the case in an appropriate manner if the taxpayer establishes that he or she was a victim of identity theft.

  2. Review the Identity Theft and Incident Management office website at http://irweb.irs.gov/Privacy/pip/itim/idtheft.html for general information about ID theft.

  3. Advise the taxpayer to take the following action when he or she reports being a victim of ID theft:

    1. contact the local police and file a police report

    2. contact the Federal Trade Commission and file a complaint

    3. notify the three major credit bureaus to post a fraud alert

    4. refer to http://www.irs.gov Keyword "Identity Theft" or "ID Theft" for additional information.

  4. Process a request for full or partial abatement, as applicable, if the taxpayer presents evidence that he/she does not owe the tax due to ID theft.

    Example:


    Wages were reported under the taxpayer's Social Security Number (SSN) but not reported by the taxpayer on his/her return because the wages were actually earned by a third party who used the taxpayer's SSN. The Service included the wages in the taxpayer's taxable income, assessed additional tax, penalty, and interest, and sent an adjustment notice to the taxpayer. The taxpayer did not pay the amount of the additional assessment.
    The Service issued a BAL DUE account for collection. A revenue officer contacted the taxpayer and made demand for full payment. The taxpayer established he or she was a victim of identity theft by providing the appropriate documentation. The revenue officer abated the assessment.

  5. Request input of the ID Theft action code to flag the account according to the procedures in IRM 5.1.12.2.2.1.1, ID Theft Action Code.

  6. Review the case history for prior enforcement activity that may need to be corrected, i.e., levies and liens.

  7. See IRM 5.12.2.25, Identity Theft, for additional procedures regarding Notices of Federal Tax Lien.

  8. See IRM 5.9.5.12, Identity Theft, for additional procedures regarding taxpayers in bankruptcy.

5.1.12.2.2.1.1  (05-20-2008)
ID Theft Action Code

  1. Transaction Code (TC) 971 Action Code (AC) 501 has been developed to centrally track identity theft incidents relating to tax administration, protect treasury revenue targeted by identity fraud, and reduce taxpayer burden. The ID theft action code serves as a single codification mechanism and will enable comparison and correlation of identity theft incidents. After a TC 971 AC 501 has been posted to an entity to indicate confirmed ID theft, tax returns entering the posting process will be prevented from posting if they do not appear to be from the legitimate owner of the Social Security Number (SSN). Cases in an RO’s inventory will be levied unless the RO manually blocks the levy.

  2. Refer to IRM 5.1.11, Delinquent Return Accounts, for further information about working cases flagged by TC 971 AC 501.

  3. Request input of TC 971 AC 501 or reversal (TC 972 AC 501) according to the following procedures.

  4. Follow normal collection procedures on ID theft cases.

    Note:

    Collection activities, including the appropriate use of enforced collection action, are not prohibited when a taxpayer has established that he or she was a victim of identity theft and his/her account reflects TC 971 AC 501. Cases in inventory will not be blocked from automated levy action.

    Caution:

    Be sensitive to the adverse impact that being a victim of identity theft may have upon a taxpayer and his/her ability to pay.

    Note:

    Consider temporarily suspending the account until the ID theft incident is resolved in cases where you determine the ID theft will have an adverse impact on the taxpayer’s ability to pay.

5.1.12.2.2.1.2  (05-20-2008)
ID Theft Action Code Input Procedures

  1. Request input of TC 971 AC 501 on the entity when a taxpayer substantiates he/she is a victim of ID theft.

  2. Check the Master File for 971 TC AC 501 to verify any previous incident substantiation via CC ENMOD.

    1. If a previous identity theft incident was substantiated, the taxpayer does not need to send in substantiation documentation in order to re-substantiate.

    2. Request input of a new TC 971 TC AC 501 for each substantiated incident

    Caution:

    Only apply 971 TC AC 501 when you have substantiated an ID theft incident and the incident has a direct impact to tax administration.

  3. Request input of TC 971 AC 501 on the entityafter you have verified the taxpayer is a victim of ID theft and within 24 hours of making the ID theft determination.

  4. Use Form 4844, Request for Terminal Action, to request the necessary input. See IRM 5.1.12.2.2.1.2.1, Completion of Form 4844.

5.1.12.2.2.1.2.1  (05-20-2008)
Completion of Form 4844

  1. The ID Theft Action Code is input on the entity instead of being input to the applicable modules, so ensure that you follow these procedures to accurately complete Form 4844.

  2. Complete the applicable blocks of Form 4844 including the following:

    1. "EIN or SSN"

    2. "Name control"

    3. "MFT code"

    4. "Periods"

      Note:

      Do notwrite the individual applicable period(s) in the "Periods" block. Instead, write "0000" in the "Periods" block to signify the entity.

    5. "Name of taxpayer"

    6. "Remarks"

  3. Follow the procedures below for entering the tax period ending date(s) in the Transaction Date (TRANS-DT) field. See 5.1.12.2.2.1.2.3 , Transaction Date Field.

  4. Follow the procedures below for completing the miscellaneous fields and the Remarks block.

5.1.12.2.2.1.2.2  (05-20-2008)
Miscellaneous Fields

  1. Complete the TC 971 AC 501 miscellaneous fields with any applicable, specific information for detailed reporting. The miscellaneous field has three parts:

    • BOD / Function (Business Operating Division / Function)

    • Program Name

    • Tax Administration Source (Tax Admin Source)

    Note:

    At this time, Form 4844does not contain specific spaces for inputting the required information in the miscellaneous fields.

  2. Request input of the required miscellaneous field information in the Remarks block of Form 4844.

  3. Use the following codes to complete the first two miscellaneous fields:

    1. BOD = "SBSE"

    2. Program Name = as applicable, enter "CFBALDUE" or "CFDELRET"

      Note:

      Insert "CFBALDUE" if you have a combination BAL DUE/DEL RET case.

  4. Use the codes displayed in the following table to complete the third miscellaneous field (Tax Admin Source):

    Tax Admin Source
    Codes Usage
    INCOME for income related issues
    MULTIFL for instances where more than one individual has filed using the same information
    BOTH for instances when both occur
    OTHER for instances when there is another issue.

  5. Enter these codes into the miscellaneous field separated by a space.

    Example:

    For an identity theft incident that has an income related tax administration impact for SB/SE Collection Field function (CFf), enter the following in the miscellaneous field:

    S B S E   C F D E L R E T   I N C O M E

5.1.12.2.2.1.2.3  (05-20-2008)
Transaction Date Field

  1. Enter the tax period ending date(s) in the Transaction Date (TRANS-DT) field. Use MMDDYYYY format of the tax year affected by the identity theft incident. The tax period ending date(s) should be the tax year(s) in which the identity theft occurred.

    Example:

    If a taxpayer substantiates ID theft and the year under collection is TY 2005, the TRANS-DT field input would be:

    1 2 3 1 2 0 0 5

    Example:

    If a taxpayer substantiates ID theft and the years under collection are TY 2005 and TY 2006, the TRANS-DT field input would be:

    1 2 3 1 2 0 0 5

    1 2 3 1 2 0 0 6

5.1.12.2.2.1.2.4  (05-20-2008)
Remarks Block

  1. Include the following in the Remarks block of Form 4844"Input TC 971 AC 501 under ENMOD."

  2. Enter any other key pertinent information about the case in the Remarks block.

    Example:

    "received valid driver's license and affidavit"

5.1.12.2.2.1.3  (05-20-2008)
ID Theft Action Code Reversal Procedures

  1. Request input of TC 972 with AC 501 on the entity to negate the impact of TC 971 AC 501.

  2. Use Form 4844, Request for Terminal Action, to request the necessary input. See IRM 5.1.12.2.2.1.2.1, Completion of Form 4844.

  3. Complete the TC 972 AC 501 miscellaneous fields with any applicable, specific information for detailed reporting. The miscellaneous field has three parts:

    • BOD / Function (Business Operating Division / Function)

    • Program Name

    • Reason

    Note:

    At this time, Form 4844does not contain specific spaces for inputting the required information in the miscellaneous fields.

  4. Request input of the required miscellaneous field information in the Remarks block of Form 4844.

  5. Use the following codes to complete the first two miscellaneous fields:

    1. BOD = "SBSE"

    2. Program Name = as applicable, enter "CFBALDUE" or "CFDELRET"

      Note:

      Insert "CFBALDUE" if you have a combination BAL DUE/DEL RET case.

  6. Use the codes displayed in the following table to complete the third miscellaneous field (Reason):

    Reason Field
    Codes Description
    TPRQ Taxpayer Request
    The taxpayer requests the 971 to be negated. The taxpayer may feel that the issue has been resolved or it is no longer needed and is impacting them negatively
    IRSERR Keying Error or Other Internal Mistake
    The 971 was due to a typographical mistake or another internal mistake and should be negated.
    IRSADM Internally Identified Negative Impact
    The 971 is causing a negative impact on another internal process or system, and should be negated to discontinue any negative impact.
    FALSE Fraudulent ID Theft Claim
    The original identity theft incident claim was determined to be fraudulent.
    OTHER Unclassified

  7. Complete the miscellaneous fields for TC 972 in the same format as for TC 971. See IRM 5.1.12.2.2.1.2, ID Theft Action Code Input Procedures.

5.1.12.2.2.1.3.1  (05-20-2008)
Transaction Date Field — TC 972

  1. The 972 will also use the TRANS-DT field to indicate which 971 which will be reversed. When the 972 is applied, enter the tax year in the TRANS-DT field to designate the 971 which should be reversed. Use MMDDYYYY format of the tax year affected by the identity theft incident.

5.1.12.2.2.2  (05-20-2008)
Taxpayer is Not a Victim of ID Theft

  1. Follow normal collection procedures if the taxpayer does not establish he or she was a victim of ID theft.

5.1.12.2.2.3  (05-20-2008)
Taxpayer Performed ID Theft

  1. Resolve the case in an appropriate manner according to the following procedures depending on whether the taxpayer performed ID theft:

    1. for purposes of tax evasion,

    2. for purposes other than tax evasion.

5.1.12.2.2.3.1  (05-20-2008)
ID Theft for purposes of Tax Evasion

  1. Develop the case as a fraud referral if the taxpayer performed ID theft by using a different TIN(s) for purposes of tax evasion.

  2. Review IRM 25.1.8, Collection Field Function.

  3. Contact the local Fraud Technical Advisor (FTA) for any necessary assistance.

5.1.12.2.2.3.2  (05-20-2008)
ID Theft for Purposes other than Tax Evasion

  1. If a taxpayer performed ID theft by using someone else's Taxpayer Identification Number (TIN) for purposes other than tax evasion, it is not a concern that the IRS would handle. Criminal Investigation (CI) would not work such cases.

    Example:


    A taxpayer is an illegal alien. The taxpayer filed a return to report his/her wages but he/she used someone else's Taxpayer Identification Number (TIN). However, the taxpayer paid the tax he/she owed.

  2. Do not alert those individuals who were victims of ID theft. Disclosure laws prohibit making any such notification.

    Note:

    Individuals may or may not know that they were victims of ID theft when their identity was stolen. When an individual becomes aware he/she was a victim of ID theft, he/she may report the crime to the Federal Trade Commission and take other action as discussed on http://www.irs.gov.

5.1.12.2.3  (05-20-2008)
Security Breach Incidents

  1. Sometimes, even when appropriate procedures have been followed, a loss of Personally Identifiable Information (PII) will occur, and a security breach incident will happen. Taxpayers whose Personally Identifiable Information (PII) was lost due to a security breach will be notified by a letter from the Service.

  2. All decisions to officially notify taxpayers of the loss of PII are done at the national level through the Office of Privacy, Information Protection and Data Security, Identity Theft and Incident Management (ITIM) Office. ITIM will send a letter to each taxpayer who is involved in a Personally Identifiable Information (PII) security breach. The letters will advise the taxpayers about assistance they can get, including the availability of a dedicated toll-free telephone number and the offer of free credit monitoring services.

    Example:


    A revenue officer spent part of the day making field calls and he properly stored his laptop computer and some hard-copy case files in his locked trunk so he could go into a restaurant for lunch. The laptop and the hard-copy case files were stolen from his automobile while the RO was eating lunch. The laptop was appropriately encrypted. However, the theft of the hard-copy case files constitutes a Personally Identifiable Information (PII) security breach.
    ITIM will notify the taxpayers potentially impacted by the security breach.

5.1.12.2.3.1  (05-20-2008)
Handling Calls from Taxpayers

  1. Refer the taxpayer to the dedicated toll-free number if you receive a telephone call from a taxpayer in response to one of the notification letters from ITIM. The dedicated toll-free phone number is 866-225-2009.

5.1.12.2.3.2  (05-20-2008)
Reporting a Potential Privacy or Security Breach Incident

  1. Report any potential privacy or security breach immediately.

  2. See IRM 5.1.3, Safety, Employee, and Security Programs.

    Note:

    In addition to following the existing Computer Security Incident Response Center (CSIRC) procedures, once a revenue officer has informed local management regarding the incident and local management has informed Area management, Area management must inform Collection Headquarters (HQ) management regarding the incident.

5.1.12.3  (05-20-2008)
Disaster Assistance and Emergency Relief Overview

  1. This section contains disaster assistance and emergency relief operating guidance for Collection Field function (CFf) employees.

  2. See IRM 25.16, Disaster Assistance and Emergency Relief, specifically IRM 25.16.1.8, Small Business/Self-Employed (SB/SE) General Procedures - Overview.

  3. Refer to subsections 13 through 19:

    • 13 — Overview of Disaster Relief Operating Procedures for Collection Field Function (CFf),

    • 14 — CFf Management Guidelines for Response to Disasters ,

    • 15 — General CFf Operation Procedures,

    • 16 — Managing Revenue Officer Inventory in Disaster Areas,

    • 17 — Revenue Officer Inventory with" -S Freeze" ,

    • 18 — Soft Contact, and

    • 19 — Summons Enforcement.

  4. Go to http://mysbse.web.irs.gov/CLD/Disaster+Assistance/default.aspx for disaster information.

  5. Go to http://www.tris.irs.gov/fema/ for a listing of IRS assistance determinations by year.

5.1.12.3.1  (05-20-2008)
Disaster Freezes

  1. There are two types of disaster freezes, the –O freeze and the –S freeze. Both freezes are established systemically for a specific period of time and for location(s) identified by postal zip code(s).

  2. The –O freeze provides systemic penalty, interest, and compliance relief and stops most compliance notices.

  3. The –S freeze will perform the same functions as the –O freeze but does not provide automatic compliance relief and will not stop generation of notices.

5.1.12.3.2  (05-20-2008)
Case Activity

  1. Cases remain in status 26 when the -O freeze is input. Group managers (GMs) may move cases out of revenue officer (RO) inventory into hold files pending the release of the -O freeze.

  2. Taxpayer contact is restricted on all –O freeze cases during the specified freeze period unless exigent circumstances apply, e.g., jeopardy condition, statute expiration, etc.

    Note:

    If the taxpayer initiates contact during the freeze period, interaction is permissible but agreements are voluntary and not enforceable for the period the -O freeze remains in effect.

5.1.12.3.2.1  (05-20-2008)
Soft Contact

  1. See IRM 25.16.1.8.18, Soft Contact.

  2. Make a soft contact to determine if:

    1. the taxpayer is still affected by the disaster after the implementation of an –S freeze or after the release of an –O freeze, and/or

    2. voluntary commitments have not been met upon conclusion of the freeze.

    Note:

    It maybe appropriate to consider a "not collectible" closure or a delay in collection activity for a specific period in such cases.

  3. Resume collection activity, as appropriate, only after determining that the taxpayer is notcurrently affected by the disaster.

5.1.12.4  (05-20-2008)
Taxpayer Requests to Record an In-Person Interview

  1. The taxpayer has the right under IRC § 7521 , Procedures involving taxpayer interviews, to make an audio recording of an in-person interview. Ten days advance written notice from the taxpayer is required.

  2. If the taxpayer does not provide ten days advance written notice, then Service employees have the option to either permit the recording or to set a new date for the interview. The taxpayer must supply his/her own means of recording. The recording can be by tape, stenography, or other means. Taxpayers have no right to make a video recording, and it is IRS policy to notallow video recordings.

5.1.12.4.1  (05-20-2008)
Agree with the Request

  1. Agree to the request subject to the following provisions:

    1. Equipment is available for the Service to produce its own recording.

    2. The recording takes place in an Internal Revenue Service office.

    3. You secure the approval of your group manager (GM) prior to making any recording.

  2. Ensure the recording equipment in your Post of Duty (POD) is operational.

  3. Secure recording equipment from another POD or procure recording equipment, as applicable.

  4. Postpone and reschedule the meeting until the necessary equipment and a suitable location are available for the Service to produce its own recording when the recording equipment and/or a suitable location are not available.

5.1.12.4.2  (05-20-2008)
Deny Requests for Video or Film Interviews

  1. Deny any request to videotape or film an interview.

  2. Attach a copy of the taxpayer's written request to the case file.

5.1.12.4.3  (05-20-2008)
When to Stop the Recording

  1. The group manager (GM) may stop an audio recording when the taxpayer’s behavior is clearly disruptive of the normal collection process.

  2. Attach a copy of the taxpayer's written request to the case file.

  3. Annotate the case history regarding the fact that your manager stopped the recording.

  4. Attach a copy of the recording to the case file.

5.1.12.4.4  (05-20-2008)
Audio Recording Procedures

  1. Arrange for your GM to be present at all times when a recording is being made.

    Exception:

    Arrange for another Service employee to be present if your GM is not available.

  2. Identify yourself, the date, time, place, and purpose of the meeting at the outset of the recording.

  3. Ask each participant in the meeting to do the following:

    1. identity themselves,

    2. state their role in the proceeding, and

    3. acknowledge and consent to the making of an audio recording.

  4. Announce if an additional participant arrives or a participant leaves during the meeting and ask any new participants to identify themselves, etc. as discussed above.

  5. Describe any written records presented during the proceeding in sufficient detail to make the verbatim recording a meaningful record when matched with the other documentation contained in the case file.

  6. State that the proceeding is completed and the recording is ended at the conclusion of the meeting.

  7. Turn the recording equipment off at the conclusion of the meeting.

  8. Attach a copy of the written request and the recording to the case file.

5.1.12.4.5  (05-20-2008)
Transcript of Recording

  1. Transcribe all or part of the recording when necessary to make the verbatim recording a meaningful record which can be matched with the documentation contained in the case file.

  2. The taxpayer may request duplication of the recording or a transcript of our copy of the interview provided the taxpayer pays for the cost of the reproduction or transcript in advance.

5.1.12.5  (05-20-2008)
Authorized IRS e-file Provider — Monitoring and Suitability

  1. The IRS performs monitoring and suitability checks on Authorized IRS e-file Providers. Monitoring may include reviewing IRS e-file submissions, investigating complaints, scrutinizing advertising material, checking adherence to electronic filing signature requirements, examining files, observing office procedures, and conducting suitability checks. Suitability checks are performed continuously regarding compliance issues.

  2. See IRM 3.42.10, Authorized IRS e-file Providers.

  3. Make referrals to the Andover Campus when you believe there are suitability issues regarding a Provider that need to be addressed:

    1. Send a suitability referral via e-mail to "*IRS E~Helpmail " .

    2. Use secure e-mail as appropriate.

  4. Make referrals as directed in IRM 4.21.1, Monitoring the IRS e-file Program, when you believe a Provider requires monitoring. Exhibit 4.21.1-15 contains the referral form template.

    1. See IRM 4.21.1.4(2), Referrals.

    2. See Exhibit 4.21.1-15.

5.1.12.6  (05-20-2008)
Income Tax Assessed Against a Child

  1. IRC § 6201(c), Compensation of Child, permits IRS to treat certain income tax assessed against a child, to the extent of the amount attributable to income included in the gross income of the child solely by reason of IRC § 73(a), Treatment of amounts received , if not paid by the child, to be considered as having also been properly assessed against the parent.

  2. Refer to IRC § 6201(c) and the related regulations for the authority to assess against a child and to treat such assessment as having been properly made against the parent.

  3. Attempt to collect income tax assessed against a child from the child.

  4. Attempt to collect income tax assessed against a child from the parent only if you are unable to directly collect it from the child.

  5. Do notassess any amount of unpaid estimated tax required to be paid under IRC § 6654(b), Failure by individual to pay estimated income tax, or IRC § 6655, Failure by corporation to pay estimated income tax.

    Note:

    Area Directors and Campus Directors are not allowed to assess any amount of unpaid estimated tax required to be paid under IRC § 6654 or IRC § 6655.

  6. Base any assessments on tax returns rather than estimates.

5.1.12.7  (05-20-2008)
Household or Agricultural Employee

  1. Follow normal BAL DUE processing to effect collection of tax on the wages of household or agricultural employees.

  2. Inform taxpayers regarding the provisions for voluntary withholding of income tax from the wages of household and agricultural employees when you make personal contact with taxpayers to help eliminate future delinquencies.

  3. Follow these procedures if taxpayers choose to request that their employers withhold tax from their wages:

    1. assist the taxpayer in preparing Form W–4 , Employee’s Withholding Allowance Certificate , and

    2. furnish the taxpayer with a copy of Circular E, Employer’s Tax Guide, for the taxpayer to deliver with Form W–4to the employer.

5.1.12.8  (05-20-2008)
Taxpayer in High Assault Risk Area

  1. lRM 5.1.3,Safety, Employee, and Security Programs, describes measures which may help ensure your safety in High Assault Risk Areas (HARAs).

  2. Review IRM 5.1.3and become aware of the measures which may help ensure your safety in HARAs.

  3. Use appropriate measures to ensure your safety when you attempt to collect on cases in HARAs.

  4. Develop awareness of the instructions in IRM 5.1.3 for reporting forcible assault or threat of force when you attempt to collect on cases in HARAs.

  5. Report any forcible assault or threat of force which occurs when you attempted to collect on cases in High Assault Risk Areas (HARAs).

  6. Refer to IRM 1.4.50.2.1.7, Caseload Rotation for further information regarding the periodic rotation of assignments located in HARAs.

5.1.12.8.1  (05-20-2008)
Coordinating with Examination on HARA Cases

  1. Follow these procedures when an Examination employee requests you to coordinate on an audit case in which the taxpayers live in High Assault Risk Areas (HARAs).

  2. Cooperate with any Examination employee who requests your assistance on an in-person taxpayer audit in the office.

    • In general, Examination is supposed to try to reduce the need for field Collection contacts by coordinating with revenue officers during the audit process when processing assessments on taxpayers who live in High Assault Risk Areas (HARAs).

    • If Collection and Examination are in the same office, and the Examination employee is conducting an in-person taxpayer audit in the office, but the Examination employee cannot collect the balance due at the time of the audit, the Examination employee may request a Collection employee to meet with the taxpayer to attempt to secure levy sources and a payment agreement.

  3. Meet with the taxpayer to attempt to secure levy sources and a payment agreement when called upon by an Examination employee in the same office who is conducting an in-person taxpayer audit in the office and the Examination employee cannot collect the balance due at the time of the audit.

  4. Request that your manager create an ICS only case with pre-assessed balance due module(s) so levy sources will be available for cases which become BAL DUE.

    1. Use Form 4844 for levy source input to the IDRS Account Number File (ANF). These levy sources may come from an Audit Report, a Form 4966, Current Collection Information, or current collection information obtained during such interviews described in above.

    2. Be alert for HARA cases in which the proposed deficiency, including accruals, is less than BAL DUE deferral.

    3. Do notinput any levy sources if the deficiency is below the BAL DUE deferral. See LEM 5.1.20.2.4.1, Routine BAL DUE Issuance Criteria. Even though the campus will generate a notice to the taxpayer, no BAL DUE will be issued in such cases.

  5. Process payments received prior to receipt of the BAL DUE on Form 3244, Payment Posting Voucher:

    1. Request input of TC 640, and

    2. Use DPC 99 to denote advance payment of determined deficiency.

5.1.12.9  (05-20-2008)
"Innocent Spouse"

  1. IRM 25.15, Relief From Joint and Several Liability, contains procedures for " innocent spouse" cases.

  2. Follow the procedures in IRM 25.15.8, Area Office Collection Procedures, to resolve applicable BAL DUE cases.

5.1.12.10  (05-20-2008)
Non-Petitioning Spouse

  1. When one spouse files a U.S. Tax Court petition on a joint return deficiency and the other spouse agrees to the deficiency or takes no appeal action, two separate IMF MFT 31 BAL DUE cases will be issued. When the campuses prepare separate accounts, the BAL DUE and DEL RET separate accounts will be annotated as follows:

    1. One separate account will be annotated "Non-Petitioning Spouse" and the other separate account will be annotated " Petitioning Spouse" .

    2. Additionally, iftwo areas are involved, both separate accounts will be annotated "two areas" .

5.1.12.10.1  (05-20-2008)
Non-Petitioning Spouse Procedures

  1. Contact any other area involved to determine if any collections have been made on the other spouse when these types of cases are in your inventory.

  2. Request a corresponding abatement of the other spouse's liability when you collect some or all of the liability from either spouse.

  3. Follow the abatement procedures below, as applicable.


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