Offers in compromise not recommended for acceptance require specific closing actions. This section addresses what must be considered when not accepting an offer, and the closing actions required when closing a case as a return, rejection, withdrawal, or termination.

Authorities relating to this section include:

The Director, Collection Policy is responsible for all policies and procedures within the Offer in Compromise program.

The National Program Manager, Offer in Compromise is responsible for development and delivery of policies and procedures within the program.

Managers of employees investigating offers are responsible for ensuring these procedures are followed and employee actions are timely and accurate.

Offer examiners, offer specialists, and other employees investigating offers are responsible for following the procedures in this IRM.

Operational and program reviews are conducted on a yearly basis by the Director, Specialty Collection OIC and OIC Collection Policy with the use of data and reports from the Automated Offer In Compromise (AOIC) system and ENTITY case management system. In addition, ad hoc reports, which provide information on the inventory levels, hours per case, and age of offers in inventory or at the time of closure, are also provided. See IRM 1.4.52, Offer in Compromise Manager’s Resource Guide.

Managerial case reviews are also completed as defined in IRM 1.4.52, Offer in Compromise Manager’s Resource Guide, . These reviews are a method to determine if the offer amount accurately reflects the reasonable collection potential (RCP) as defined in Policy Statement 5-100.

National quality reviews and consistency reviews are routinely conducted to ensure program consistency and effectiveness in case processing. As a result of these reviews, procedural changes may be required to improve the quality and effectiveness of the program.

ICS is used by field employees as a method for inventory control and history documentation.

AOIC is used to track offers submitted by taxpayers and record case actions and history. Ability to take action on AOIC is limited to specific offer employees. Additional permissions are provided based on an employee’s duties and responsibilities.

Managers are required to follow program management procedures and controls addressed in IRM 1.4.50, Collection Group Manager, Territory Manager and Area Director Operational Aid and IRM 1.4.52, Offer in Compromise Manager’s Resource Guide.

Approving officials ensure the closing of the offer via return, rejection or withdrawal is appropriate, and all actions required by the IRM are taken. Managerial requirements for case approval are defined in IRM 1.2.2.6, Delegations of Authority for the Collecting Process.

Monitoring OIC (MOIC) is responsible for addressing any funds held as deposits by applying the funds to the liability or issuing a refund.

Terms or acronyms used throughout this IRM:

For a list of other common abbreviations, definitions and acronyms used throughout this IRM, see IRM 5.8.1 Exhibit 1, Common Abbreviations Used in the IRM.

Additional acronyms and keywords can be searched in the ReferenceNet Acronym Database, at http://rnet.web.irs.gov/Resources/Acronymdb.aspx.

Additional resources can be found in:

Employees can find helpful information on these websites:

An offer is determined to be not processable if any of the "Not Processable" criteria listed in IRM 5.8.2.4.1, Determining Processability, is present. This decision is the sole responsibility of the Centralized OIC (COIC) sites located in the Brookhaven and Memphis Campuses.

Processable returns include all returns made after the offer has been determined to be processable.

A processable return will result in suspension of the collection statute for the period of time the offer was considered processable and will result in the IRS keeping the application fee and applicable TIPRA payment(s). A taxpayer whose offer is closed as a return does not receive appeal rights; however different levels of approval exist for some return situations. The IRS's return of an offer may be reconsidered in limited situations. Refer to IRM 5.8.7.3 below for reconsideration criteria.

During the offer investigation, there are a number of situations that may result in a processable offer being returned to a taxpayer. During discussion with the taxpayer or if correspondence is sent, the taxpayer should be made aware of all issues which are preventing the offer investigation from proceeding, i.e. the taxpayer may have compliance issues and verification of an expense is required.

The following chart lists the reasons a processable offer may be returned and who can authorize the return. Approval authority is outlined in IRM 1.2.2.6.1.3, Return Authority.

Generally, the taxpayer or the representative must contact the IRS to raise objections and provide an explanation for failure to provide the requested items. The objection must be raised within 30 calendar days from the date of the return letter (unless the condition that caused the failure to supply the substantiation continued for a prolonged period).

Acceptable criteria for potential situations where return reconsideration may be applicable based on IRS error are listed below. These are not all inclusive.

Acceptable criteria for potential situations where return reconsideration may be applicable based on specific taxpayer issues are listed below. These are not all inclusive.

The following would not be acceptable criteria for return reconsideration:

Approval to reconsider a returned, processable offer(s) will be obtained from the COIC team manager or FOIC group manager. This authority may not be re-delegated.

Before requesting the taxpayer or authorized representative send any missing documentation or payments to support a reconsideration, obtain approval from your manager that the case qualifies to be considered. It is not necessary for the manager to document the AOIC history until the taxpayer has provided any requested information and a final determination is made whether to reconsider the offer.

The manager will indicate ultimate approval or denial of the request by making a history entry on AOIC.

If the employee receiving a telephone request from a taxpayer or authorized representative for reconsideration determines the request does not have merit, based upon the acceptable criteria outlined in IRM 5.8.7.3.1, Criteria for Return Reconsideration above, the employee will advise the taxpayer or their authorized representative of the decision and the taxpayer's right to discuss the issue with the employee's manager. Annotate the closed offer record history on AOIC.

If the employee receiving a telephone request for reconsideration determines that the request does have merit based upon the acceptable criteria outlined in IRM 5.8.7.3.1, Criteria for Return Reconsideration above, after manager concurrence, the employee will:

If the taxpayer or their representative fails to provide the requested information, annotate the closed AOIC remarks that there will be no reconsideration. Close any open controls or CIPs.

If the taxpayer or their representative provides the requested information, the recommending employee will:

Retain the original Form(s) 656 in the case file and if the offer is reopened, see IRM 5.8.7.3.3.3.

Taxpayers may voluntarily withdraw their OIC at any time prior to the IRS’ acceptance of the offer. A withdrawal must never be solicited merely to avoid a complete investigation or deny taxpayers access to Appeals.

When an OIC cannot be recommended for acceptance, allow the taxpayer an opportunity to voluntarily withdraw the offer and, at the same time, inform the taxpayer that withdrawing the offer forfeits all appeal rights.

A voluntary withdrawal request may be made orally, by fax, or in writing. Receipt of a withdrawal (either in writing or orally) must be clearly documented in the case file indicating how the request was received. See IRM 5.8.7.4.3 for the date a withdrawal is effective.

Review AOIC to determine if any taxpayer payments are being held as a deposit. If there is a deposit, see IRM 5.8.7.8 for required actions.

Document the case history or correspondence that the taxpayer was informed that a withdrawal forfeits their appeal rights.

Per IRM 5.8.4.13(3), wait 15 days after the date of the letter before processing any NFTL request to Centralized Lien Operations (CLO). If appeal rights were discussed with the taxpayer, it is not necessary to wait 15 days unless a significant time has passed. Refer to IRM 5.1.9.2, Informing Taxpayers of Their Appeal Rights.

AOIC should be documented with results of contact or any actions taken.

If during the investigation the taxpayer fails to make the required subsequent periodic payments as required by TIPRA, the offer may be considered withdrawn. Check both AOIC and IDRS for TIPRA payments prior to an involuntary withdrawal determination.

One request for the missed payment(s) must be made by telephone. If the taxpayer or their representative cannot be contacted by telephone, issue a letter requesting the missed payment(s). If the contact is by telephone, allow the taxpayer 15 calendar days to submit the payment(s) before taking the next action. If the contact is written, allow 15 calendar days from the date of the letter for the taxpayer to submit the payment(s) plus mail time as appropriate, before taking the next action. Document the case history.

If the taxpayer provides a reasonable explanation for missing the payment(s) (i.e. special circumstances exist), the investigation of the offer should continue.

Review AOIC to determine if any taxpayer payments are being held as a deposit. If there is a deposit, see IRM 5.8.7.8 for required actions.

Issue the withdrawal letter indicating that the taxpayer failed to comply with the request for the required payment(s), therefore the offer is withdrawn.

The letter must include the following information:

Close the offer as withdrawn as defined in IRM 5.8.7.4.3, Closing an Offer as a Withdrawal, below.

Document the case history, thoroughly describing the attempts to secure the funds and the decision to consider the offer withdrawn.

Document AMS that the offer was closed due to failure to make required offer payments. This provides IRS personnel with information regarding the offer closure.

In instances where the failure to remain in compliance with periodic payments was subsequent to a preliminary discussion with or letter being issued to the taxpayer advising that the OIC would be rejected, proceed with rejection of the offer without contacting the taxpayer to discuss the non-compliance. See IRM 5.8.7.7.

Per IRM 5.8.4.13(3), wait 15 days after the date of the letter before processing any NFTL request to Centralized Lien Operations (CLO). If appeal rights were discussed with the taxpayer, it is not necessary to wait 15 days unless a significant time has passed. Refer to IRM 5.1.9.2, Informing Taxpayers of Their Appeal Rights.

Upon notification of a dishonored required TIPRA periodic payment, the offer should be returned in accordance with IRM 5.8.7.2.2.5, Return for Dishonored Payments.

Offers closed as withdrawals do not require preparation of Form 1271, Rejection Memorandum.

The effective date of an involuntarily withdrawn offer is the date the letter is issued. The effective date of the voluntary withdrawal will depend on the method of receipt of the request to withdraw. The following chart shows the correct date to use as the withdrawal date:

The following actions should be taken to close an offer as a withdrawal:

Offers closed as terminations do not require preparation of Form 1271, Rejection Memorandum.

The following actions should be taken to close an offer as a termination:

Mediation may only be considered after the OS has fully developed the case facts and made a reasonable attempt to negotiate an acceptable offer. A request for participation in FTMC should be initiated after an issue has been fully developed, but before Collection has made a final determination regarding the issue.

Taxpayers or taxpayer representatives who express an interest in mediating must first request a conference with the manager.

The opportunity to mediate should only be granted after the first level manager has reviewed the case and determined that the issues in dispute may be resolved in mediation.

When appropriate, mediation should be addressed before the case is forwarded to the Independent Administrative Reviewer for approval. If the rejection letter has been issued, FTMC may not be utilized.

Below are some examples of when it would be appropriate or inappropriate to offer mediation. The examples are not all inclusive.

Cases requiring approval higher than that of a FOIC manager are not eligible for FTMC. See IRM 1.2.2.6.1.1, Acceptance Authority.

Both parties have to agree to mediation to participate in FTMC. If the OS and group manager do not feel the mediation would be beneficial, see IRM 5.8.7.6.3.

When the request for mediation is granted, the OS will complete the following actions:

Update the case category code (CCC) in AOIC to 42.

If Fast Track Mediation is denied, document the case file with the reason for the denial, including how it was relayed to the taxpayer and/or their representative.

Managerial approval is required. The manager should indicate concurrence by documenting the ICS history.

Update the CCC code in AOIC to 42.

An offer rejection may also be based on a determination that acceptance of the specific offer at hand is not in the "best interest of the government" (NIBIG) as discussed in Revenue Procedure 2003-71, SECTION 6.03 which states: "The decision whether and when to accept an offer to compromise a liability is within the discretion of the IRS. In keeping with IRM 1.2.1.6.17, Policy Statement 5-100, an offer will only be accepted if it is determined to be in the best interest of both the taxpayer and the IRS. In addition to the criteria discussed in Section 4.02, the IRS may take into account public policy and tax administration concerns in determining whether an offer to compromise is acceptable" . Rejections under this provision should not be routine and should be fully supported by the facts outlined in the rejection narrative. Offers rejected under this section require the review and approval of the second level manager; that is, Territory Manager for the field or Operations Manager for COIC.

Even if a determination is made that a rejection under this basis is appropriate, a calculation of the taxpayer's ability to pay needs to be fully developed. The preliminary asset/equity and income/expense tables as discussed in IRM 5.8.4.7, Additional Initial Offer Actions, should be completed and provided to the taxpayer. The extent of additional verification, if required, should be based on the facts of the case. The preliminary tables and the basis for the rejection should be discussed with the taxpayer/representative to allow for submission of additional information for consideration.

The discussion regarding the basis for the rejection must be well documented and addressed in the open paragraph. See IRM 5.8.7.7.3 for preparation of the rejection letter.

IRM 5.8.4, Investigation, includes examples of situations that warrant rejection under NIBIG, including:

Below are additional situations that may warrant rejection as not being in the "best interest of the government" (not all inclusive). .

In each of the situations listed, a complete analysis of the taxpayer's financial situation must be completed prior to a final determination that a rejection under NIBIG is the appropriate course of action. RCP must be fully developed. If Appeals does not sustain the basis of NIBIG, they will consider acceptance of the offer under DATC for the amount determined by Collection as RCP.

In circumstances where the potential for a fraud referral exists, the financial evaluation conducted and verified should be based on the facts and circumstances of the case. Refer to IRM 5.8.4.18, Potential Fraud Referrals. Do not solicit a withdrawal when there is potential for a fraud referral.

Policy Statement 5-89, IRM 1.2.1.6.15 , establishes that offers may be rejected on the basis of public policy if acceptance might in any way be detrimental to the interests of fair tax administration, even though it is shown conclusively that the amount offered is greater than could be collected by any other means, provided no ETA issues exist.

Offer acceptance reports are open to public inspection in accordance with Internal Revenue Code § 6103(k)(1), so the general public may be aware of any offer acceptance. A decision to reject an offer for public policy reason(s) should be based on the fact that public reaction to the acceptance of the offer could be so negative as to diminish future voluntary compliance by the general public. Decisions to reject offers for this reason should be rare.

A reasonable collection potential computation is required even if the basis for rejection is public policy. Complete the preliminary asset/equity and income/expense tables as discussed in IRM 5.8.4.7, Initial Offer Actions. You may base the extent of additional verification requested from the taxpayer on the facts of the case. Discuss the preliminary tables and the basis for the rejection with the taxpayer/representative to allow for submission of additional information for consideration.

After discussing with the taxpayer/representative, if the decision to reject the offer is appropriate, proceed with rejection in accordance with IRM 5.8.7.7.3, Recommending Rejection of an Offer. The rejection letter will provide the taxpayer appeal rights in accordance with Treasury Regulation 301.7122-1(f)(5). Use paragraph D in the AOIC rejection letter.

Below are some examples of situations that may warrant rejection based on a public policy decision.

An offer will not be rejected on public policy grounds solely because:

The rejection narrative should discuss the specific public policy issues.

Rejections of this type require the approval of the SB/SE Collection, Territory Managers (2nd level) in the field or SB/SE Compliance Services Operations Managers for COIC. Refer to IRM 1.2.2.6.1.2 , Rejection Authority.

The following actions should be taken to recommend rejection of an offer:

Prepare the rejection letter and Form 1271.

Document the ICS history or AOIC remarks regarding the decision. Include the following:

Document AMS history with a brief statement regarding the rejection recommendation. You may include information regarding any assets, income stream or the amount required for compromise if it would aid in collection.

Assemble the file. Use of labeled dividers Document 9600-B is required.

AOIC should be updated to show the location and status of the case rejection recommendation.

If the offer includes MFT 74 or MFT 76 modules, see IRM 5.8.10.16.5, Procedures Relating to MFT 74 and MFT 76 Modules - Case Closures, for additional closing actions.

Treasury Regulation 301.7122-1 (f) (5) provides that the 30-day period to request an appeal starts the day after the date on the rejection letter. The rejected offer must be suspended during this 30-day period to allow the taxpayer an opportunity to request an appeal, even if the taxpayer advises the IRS that no appeal is desired. These cases should be monitored for receipt of a request for appeal.

Rejected offers should be held in the suspense file for 15 calendar days past the 30-day deadline to allow time for an appeal request to be received and associated with the offer file.

If no appeal request is received by the 45th day from the date of the rejection letter, the following actions should be taken:

If a timely appeal is discovered after the offer was closed as a rejection, utilize Reopen Closed Offer from the AOIC Area Office Menu using “administrative error” as the reason. Input manual TC 480 and STAUP to stat 71.

Appeals may be submitted via mail; via fax; or via hand-delivery. When a request for appeal is received, it must be reviewed upon receipt to determine if it was submitted timely and contains the required statements and signatures. Document that an appeal was received, the fax or postmark date; and provide a brief description of the contents. The IRS looks to different rules to determine if a document is considered timely, as described in IRM 25.6.1.6.15, When a Document is Treated as Filed Under the IRC. If a request is received after the 30 calendar days referenced in the rejection letter, consider if it is timely based on the rules below. For additional information regarding timeliness of requests for Appeals’ hearings, refer to IRM 8.22.5.3.1 , Determining Timeliness - General Procedures.

If the appeal was not received timely, notify the taxpayer that the appeal was not timely and will not be forwarded to Appeals for consideration. Notification may be verbal or in writing but should be documented. Written notification may be completed using AOIC transfer letter, paragraph C.

If the taxpayer provides additional financial information that does not change the determination, but does not enclose Form 13177 or an appeal letter, make one attempt to reach the taxpayer by phone. Advise them of any change in RCP and that the information does not change the rejection determination. If the appeal window is open, determine if the taxpayer wishes to submit an appeal via fax. The submission of additional information does not extend the 30 day appeal period and is not considered an appeal with perfection issues.

If the request for appeal is unsigned, the request will not be considered a valid appeal. As soon as the defect is identified, make a reasonable attempt to secure a perfected appeal. See 5.8.7.7.5(7).

If a joint offer is rejected and only one spouse signs the request for appeal, an effort should be made to perfect the request. Contact the taxpayers and have the other spouse sign the request for appeal. If there is no response to the request for perfection, then the appeal will only be considered for the spouse who signed the request for appeal. Appeals will secure an amended Form 656 if the offer is ultimately accepted. Change the AOIC entity to the name of the spouse who requested the appeal, and change the indicator on the MFT screen from “B” to “P” or “S” as applicable.

Any request for Appeals consideration must include a written, signed protest in accordance with guidance provided in the rejection letter issued to the taxpayer. The rejection letter and the Form 13711, Request for Appeal of Offer in Compromise, contain the required language. Additional information may be found in Pub 5 , Your Appeal Rights and How to Prepare a Protest If You Don’t Agree. Taxpayer-signed appeals must contain the perjury statement, while representatives may select the appropriate declaration:

If the request for appeal does not contain the required statements, the request will not be considered a valid appeal and the taxpayer or POA should be notified as soon as the defect is identified. The taxpayer should be provided the opportunity to perfect the appeal.

While there is no statutory provision for the perfection of an appeal, it is the IRS’s practice to make a reasonable telephonic attempt to secure a processable appeal. If you receive a timely request for appeal which has not been signed with the required statements, make a reasonable attempt to contact the taxpayer or POA by phone as soon as the defect is identified. A reasonable time (no more than 15 calendar days) shall be allowed to perfect the request by including the applicable signature(s) and/or statement(s). If you make contact, advise that failure to perfect the appeal will result in the offer being closed and the taxpayer not being provided consideration by the Independent Office of Appeals.

If the request is signed on the taxpayer’s behalf by an unauthorized representative, contact the taxpayer directly to explain the person who signed the appeal is not authorized to do so. The taxpayer may sign the appeal with the required statement, or if applicable, provide a valid Form 2848 to allow for processing of the original appeal. Allow no more than 15 calendar days to perfect the request. If you make contact, advise that failure to perfect the appeal will result in the offer being closed and the taxpayer not being provided consideration by the Independent Office of Appeals.

If the taxpayer fails to perfect the request for appeal within the time-frame provided, the offer should be closed as "rejection no appeal." Prior to closing on AOIC generate a transfer letter using Option C, to notify the taxpayer the appeal was not timely and cannot be considered by Appeals.

The taxpayer should provide specific information with the appeal letter, including a list of items of disagreement and evidence to support any of those items. If the letter provides new information not previously considered, the case should be reassigned to an OE/OS for reconsideration.

The taxpayer is entitled to an appeal of the offer rejection, even if items of disagreement are not provided or argued. If it can reasonably be determined that the letter is a request for an appeal, the taxpayer should be afforded that right.

If the taxpayer agrees to increase the offer to the amount you proposed, ensure they understand an amended proposal does not extend the appeal period. If they wish to secure appeal rights in case the offer is not approved during the review process, they may submit a signed Form 13711 with the addendum / amended offer.

If a deposit is associated with the case, clearly notate the file so Appeals knows additional action may be required. Print the AOIC summary screen and highlight the deposit. Note if the taxpayer provided instruction regarding the deposit on Form 656. If a request was previously sent to MOIC to apply the deposit to the liability, ensure that information is documented in the AOIC Remarks and highlighted in the file for Appeals information.

If the offer includes MFT 74 or MFT 76 modules, see IRM 5.8.10.16.5.1, Procedures Relating to MFT 74 and MFT 76 Modules - Closing Rejection with Appeal. Because manual inputs are required when closing offers with these assessments, the closing history must advise Appeals that required closing actions are in IRM 5.8.10.16.5.

The review of the taxpayer’s submitted information, preparation of any additional documents, and forwarding the taxpayer’s request to Appeals should be completed in a timely manner. Refer to IRM 5.8.4.10 , Follow-Up Actions, regarding timely actions. Managers are responsible for assigning cases in accordance with IRM 1.4.52 , Offer in Compromise Manager’s Resource Guide.

If Appeals returns an offer with an imperfect appeal as a premature referral, the OE/OS should request perfection of the appeal from the taxpayer/POA within 15 days of receipt of the case from Appeals. If the taxpayer/POA does not comply with the request for perfection within 15 days of the request by the OE/OS, the offer should be closed as "rejection no appeal" . Generate a transfer letter using Option C, prior to closing the offer.

Upon receipt of the taxpayer's appeal, the OE/OS will review the information provided to determine if any new information is identified or additional documentation has been submitted. If after review, the OE/OS determines rejection of the offer is still appropriate, additional discussion with the taxpayer may be necessary. New information is information that was not previously discussed with or raised by the taxpayer, or not previously investigated and documented by the OE/OS.

If the taxpayer appeal does not include new information requiring additional investigation or consideration by the OE/OS, the OE/OS will:

If the taxpayer appeal includes new information requiring additional investigation by the OE/OS, the OE/OS will:

If the additional investigation does not result in a decision to change the recommendation to an acceptance, the OE/OS will take the following actions:

The manager will take the following actions:

After review of taxpayer's appeal:

If an offer previously forwarded to Appeals is returned as a premature referral, the originating function may not communicate ex parte with Appeals while reconsidering the case, other than with respect to ministerial, administrative, or procedural matters, without offering the taxpayer or representative an opportunity to participate in the discussion because Appeals may ultimately review the case. If necessary, the taxpayer should be contacted to discuss the results of any additional investigation or be provided with information by the manager relative to the results of any additional investigation that was not discussed with the taxpayer via correspondence, prior to the offer being returned to Appeals.

There may be rare instances, after the taxpayer's request for Appeals consideration of a rejected offer in compromise has been forwarded to the Independent Office of Appeals, that Collection will secure significant new information that needs to be provided to Appeals to allow Appeals to fully evaluate the offer in compromise. In these rare instances, supplemental information can be provided to Appeals as long as Collection concurrently provides the same information to the taxpayer/representative. Appeals will give the taxpayer/representative the chance to respond to the supplemental information.

When supplemental information is provided by Collection to Appeals based on the discovery of new information, a letter, signed by the manager, will be issued to the taxpayer/representative that identifies the new information and explains that the information is being provided to Appeals. Include with the letter sent to the taxpayer/representative a copy of the written communication to Appeals and any documents being sent to Appeals. Document issuance of the letter in the AOIC remarks or ICS history and include a copy of the letter with the supplemental information sent to Appeals.

Appeals Account & Processing Support (APS) is responsible for closing cases on AOIC. Accepted offers are forwarded to MOIC. Files for sustained and withdrawn offers will be returned to the originating office for archiving. Additional actions may be appropriate.

If a NFTL request is in the file, it must be reviewed to ensure the information is current (entity information, periods, and unpaid balance of assessment). Also, it cannot include any SRP liabilities. See IRM 5.12.2.3.1.1, Affordable Care Act’s (ACA) Shared Responsibility Payment (SRP) Exception, and IRM 5.12.2.6.1, ACA Shared Responsibility Considerations When filing NFTL.

If the file contains a red “M” after the offer number on the case file or is otherwise identified as needing mirroring, review to determine if mirroring is required. Process a request for mirroring the accounts (MFT 30/31 and MFT 35/65) in accordance with the mirroring procedures discussed in IRM 5.19.7.11 , Separate OICs on Joint Liabilities.

Review the file for alternative resolution instructions. See IRM 5.8.7.10, Alternative Resolutions and Collection Assignment, for procedures on forwarding the case for the next appropriate collection action.

Route the offer file to the closed files.

If the taxpayer’s account was previously in stat 60, reinstate the installment agreement (IA). See IRM 5.8.4.25.2, Offers in Status 60. The terms, including the due date of the monthly payment, will be based on the prior agreement, as shown in IADISP. If the taxpayer wants an alternate date, indicate this in the reinstatement request. The first payment will be due in 5-9 weeks and a letter will be issued to confirm the IA. COIC reinstatement requests are routed internally; FOIC may e-mail the request to the appropriate COIC mailbox. User fees are waived for reinstatement after OIC.

If an agreement is reached to have the taxpayer resolve the liability via an installment agreement, assist the taxpayer with establishing an agreement. Refer to IRM 5.14, Installment Agreements and the IA table at http://mysbse.web.irs.gov/collection/toolsprocesses/CaseRes/IA/iatable/default.aspx, for installment agreement criteria. Guidance for processing new installment agreements can be found on OIC SharePoint (SP) in the Alternative Resolution library. Follow the instructions, including input of the appropriate TC 971 code and STAUP action to prevent the account from progressing to collection status before the agreement can be input.

If the liability qualifies for a streamlined agreement, advise the taxpayer to apply using the Online Payment Agreement (OPA) feature at IRS.gov/paymentplans. You may also assist by preparing a Form 433-D, Installment Agreement. If the liability and monthly payment ability do not qualify for guaranteed or streamlined installment agreements, you must prepare and process a Form 433-D. .

If the taxpayer plans to use OPA to submit their installment agreement request, request STAUP to hold collection notices for 9 cycles when the offer is closed on AOIC. Advise the taxpayer to wait approximately two weeks after they receive the letter regarding the offer closure before submitting a request through OPA. They may or may not receive a collection notice depending on when the STAUP posts. If the account is still in offer status 71, any requests for installment agreement cannot be processed.

For non-streamlined agreements, refer to IRM 5.15, Financial Analysis, when determining the appropriate payment amount.

A partial pay installment agreement (PPIA) can be recommended if it is the best collection alternative. The first payment should include any liquid funds or obtainable equity shown on the AET. Special rules apply, such as if the taxpayer defaulted an IA within the last 24 months, the agreement must established as a DDIA. Refer to IRM 5.14.2, Partial Payment Installment Agreements and the Collection Statute Expiration Date (CSED), for PPIA procedures or search PPIA on the Knowledge Management Library.

If a CSED is within 6 months of expiration, that period will not update to status 60. Unless manually applied or transferred, the taxpayer’s installment payments will not post to a non-status 60 module. If the module will be expiring before the taxpayer’s first anticipated payment, no action is required. If payments should post to the short CSED period first, utilize the work around instructions for modules with short CSEDs on the OIC SharePoint site, Alternative Resolution Library.

When an offer cannot be recommended for acceptance but the completed offer investigation shows the taxpayer currently has no payment ability, obtain manager approval to place the account in currently not collectible (CNC) status. In most cases this will involve IMF accounts. Defunct BMF entitles may be closed CNC if a prior field call to view assets was conducted. To CNC an account and issue the required confirmation letter via IAT, follow current procedures posted to OIC SharePoint under Alternative Resolutions Library. Alternately, you may complete Form 53, Report of Currently Not Collectible Taxes, and e-mail to CCP for input. If the Form 53 is input by CCP, the OE/OS is responsible for issuing the confirmation letter - Letter 4624C if prepared through IAT or Letter 4223 in ICS macros.

If a TC 530 with a hardship closing code is within one year of offer submission, return the account to Status 53. Managerial approval is not required. If the TC 530 is over one year old, and the taxpayer has the ability to full pay through an installment agreement or has substantial equity in assets, which were not considered when the account was reported CNC, reverse the TC 530 with the input of a TC 531 using REQ77/FRM77 and follow the procedures below to refer the case for collection assignment.

Before proceeding with CNC request procedures on OIC SharePoint, the offer must be closed on AOIC. It is not necessary to wait for the closing TC 48X to post. If the Form 53 is sent to CCP, you must wait until the TC 48X posts to IDRS.

Accelerate to ACS status 22 any case that is not being referred for other specific action (such as IA, CNC, or status 26).

Refer for input of STAUP 22 00 with an assignment code of 0605.

In some cases, the best collection alternative may be to assign the balances to a field RO. Only cases with reasonably established collectibility that potentially require advanced enforcement tools (e.g. seizure, levy on retirement accounts, etc.) should be accelerated to status 26. All others should be accelerated to ACS, per IRM 5.8.7.10.3. At least one year must remain on the CSED for cases being referred to field collection.

Types of cases that qualify include:

Cases with assets that require advanced enforced collection but may not meet the $50,000 anticipated collectibility threshold may be accelerated to status 26 if they qualify based on their outstanding liability amounts. See OIC SharePoint “Steps for Issuing an ICS OI” for the amounts.

Document the justification for field assignment in the final paragraph of the closing narrative. Include specific information regarding the property such as market value and encumbrances, or source of monthly payment ability.

When reviewing the closing narrative, if the manager agrees that the case meets status 26 criteria and immediate field action is warranted, they will annotate their concurrence in the AOIC remarks or the ICS case history as applicable, and on the case routing sheet. If the criteria is not met, the case should be referred to status 22.

If the offer is not appealed, COIC or FOIC will take the following actions:

Document 12990, Records and Information Management Record Control Schedules, , allows local offices to retain closed files until “there is no longer a business need” to retain them at the local level.

Follow procedures in IRM 1.15.4, Retiring and Requesting Records, when mailing closed cases to the FRC.

COIC and field Area offices are required to load the FRC information on the AOIC FRC Tracking screen, for each case, prior to mailing the closed file(s) to the FRC. This screen includes the offer number, accession number, box number, FRC date and location. Refer to the AOIC Course User’s Guide for instructions on loading information on the AOIC FRC Tracking screen.

For any case in which you are unable to record the FRC information on the AOIC FRC Tracking screen, document the accession number, box number, FRC date and location in AOIC Remarks.