The interagency agreement between the IRS and BFS provides for certain federal payments disbursed or administered by BFS to be systemically and continuously levied. BFS is the levy source for all levies issued through the FPLP — not the federal payment agencies.

The following federal payments are subject to the FPLP:

Prior to 2006, on delinquent IMF joint income tax and BMF sole proprietor tax liabilities, the FPLP only levied federal payments that matched to the primary TIN. Starting January 2006, FPLP also began matching and levying federal payments identified for valid secondary or cross-reference (XREF) SSNs on those IMF and BMF accounts.

See Exhibit 5.11.7-2, Table of Federal Payments Subject to the FPLP, for the payment types that are levied through the FPLP; the type of Master File accounts that match with a certain federal payment type; and the levy percentage, i.e. 15% or 100%.

If a taxpayer is receiving two or more types of federal payments that are available for levy through the FPLP, then each of those payments will be levied. The FPLP cannot selectively levy a certain payment separately for a particular taxpayer. Likewise, if both spouses on joint income tax liabilities are receiving federal payments subject to the FPLP, then both will be levied. The FPLP cannot levy only a certain spouse separately for their joint delinquent tax module.

The delegation authority to issue an IRC 6331(h) levy, levy release, and return of levied property remains the same as outlined in Delegation Order 5-3. See IRM 1.2.44.4, Levy on Property in the Hands of a Third Party.

Certain Taxpayer Advocate Service (TAS) employees are delegated to release systemically generated levies such as the FPLP, but only under the procedures contained in IRM 5.11.7.3.6 (or successor provisions). See Delegation Order No. 13-2 (Rev 1.), IRM 1.2.50.3. TAS employees cannot, however, take action on a case that is open in another function. TAS employees may only generate levy releases on collection modules not assigned to Automated Collection System (ACS) Status 22 with an open control base only or collection field Status 26. See IRM 13.1.4.2.3.15, Levy Release Authority and Return of Levy Proceeds, or refer to TAS Delegation Order authorities and successor revisions.

The FPLP systemic process is not subject to third party notification provisions under IRC 7602(c), Examination of books and records, Notice of contact of third parties, because contact is made between electronic database(s).

Third-party contact provisions must be satisfied prior to any personal contact with BFS (or other federal agencies and third parties) about taxpayers subject to FPLP.

For a BMF employment tax module (MFT 01, 10, 11, 14 and 16) to qualify for a DETL, there must have been a CDP hearing previously requested on another BMF employment tax module no more than two years prior to that DETL-qualified module's period end date.

BMF employment tax modules that are selected into the FPLP, may also be subject to the DETL process. In order to select FPLP DETL periods, a new FPLP BMF entity indicator "AC 630 (YYYYMMDD) DATE" has been created. This new indicator is displayed in the BMF entity CC BMFOLE. A taxpayer's employment tax module may be selected for a FPLP DETL, if the entity indicator's action code (AC) 630 date is within the "two-year look back" period of that DETL-qualifying module's period end date.

The FPLP BMF entity indicator "AC 630 (YYYYMMDD) DATE" is defined as the following:

All federal payments available in the FPLP, except SSA and RRB payments, may be subject to a FPLP DETL. (The CDP notice will be issued prior to issuing the FPLP levy on SSA payments.)

See IRM 5.11.7.3.3, FPLP Systemic Processes and Indicators, and IRM 5.11.7.3.3.4, Levy Service Process, for the specific transaction codes on how to recognize when an employment tax module is selected into the FPLP DETL process.

Tax modules or the taxpayer entities that qualify for the FPLP but have certain condition and freeze codes under the primary Taxpayer Identification Number (TIN) will be excluded from FPLP selection.

Accounts that are generally excluded from the FPLP are those that, statutorily or operationally, should not be in levy status and are coded that way in the Master File or Taxpayer Information File. Those accounts include unable-to-pay; pending installment agreements (IA) posted prior to a FPLP levy; approved installment agreements; pending or approved Offers-in-Compromise (OIC); open Disaster Zone indicators; Combat Zone; open bankruptcies or litigation; certain pending claims and adjustments; innocent spouse modules; and certain imminent Collection Statute Expiration Date (CSED) modules. See Exhibit 5.11.7-3, FPLP Exclusion Criteria, which displays the list and description of entity and module transaction and freeze codes that are excluded from FPLP.

Social Security benefit payments will not be subject to the FPLP levy if either of the following exists:

Delinquent Individual Master File (IMF) taxpayers who qualify for the FPLP and are reported to receive SSA benefit, military retirement payments or Railroad Retirement Board (RRB) benefit payments, will be excluded from the program if their estimated total income falls below 250% of the Department of Health and Human Services (HHS) Poverty Level Guidelines (PLG). These taxpayers are processed through the FPLP Low Income Filter (LIF).

Taxpayers who have any of the following conditions are not processed through the FPLP LIF analysis and are selected into the FPLP:

In the LIF process, the total income source examined on these taxpayers will be either the total positive income (TPI) from their current year income tax return, if any, or from certain income documents reported on the current year IRP Master File, whichever is later. See Exhibit 5.11.7-4, Low Income Filter Estimated Income - Information Returns Processing Master File. If both current year documents are available, then the source with the greater amount is examined.

Taxpayer accounts that are processed through the FPLP LIF are identified with TC 971 AC 543 posted in their entity. The TC 971 AC 543 indicates that the FPLP LIF analysis processing has taken place to determine if the balance due modules should be selected or excluded from the FPLP.

The TC 971 AC 543 will display:

If the TC 971 AC 543 total income amount is below 250% of the HHS PLG amount, then the taxpayer’s balance due modules will be excluded or removed from the FPLP. If the income amount is at or above 250% of the PLG amount, then the taxpayer’s balance due modules will be selected into the FPLP.

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Certain modules that may be selected into the FPLP, as discussed above, are systemically blocked from the program with TC 971 AC 061 (with the Document Locator Number (DLN) displaying a series of 8s or 9s). Under certain conditions, these accounts may be manually or systemically unblocked. See IRM 5.11.7.3.6.4, Removal (Reversal) of the FPLP Block with TC 972 AC 061.

All delinquent modules that meet the selection criteria will be transmitted to BFS to be matched with federal payments. See IRM 5.11.7.3.2, FPLP Selection Criteria.

When the module is selected, a TC 971 AC 060 will post. An unreversed TC 971 AC 060 generates the following account indicators:

The FPLP cases that are sent to BFS become part of the BFS National Interactive Delinquent Debtor Database (NIDDD) of U.S. Federal debtors, which includes non-tax debtors. This BFS federal debtor database is shared with the GSA System for Award Management (SAM) database. SAM (https://www.sam.gov) is the Federal government's centralized registrar database of taxpayer entities who register to bid for a federal contract or grant. The SAM flags federal registrants who have federal debt in the BFS NIDDD, including FPLP tax debt. The SAM record will indicate 'yes' or 'no' for a federal debt. No other debt information is provided. If a registrant inquires about their debt flag, then BFS or GSA will refer them to the IRS to resolve their accounts. For IRS tax debts, a taxpayer's debt flag will be removed when they are removed from the FPLP.

Once a tax module is selected for the FPLP, it is transmitted to BFS. If BFS identifies a Federal payment or source match, then a TC 971 AC 062 will post on the module.

The matched TIN will be displayed under the TC 971 AC 062 XREF field for IMF accounts and BMF accounts.

The DLN associated with TC 971 AC 062 will include information about:

If the TC 971 AC 062 DLN indicates match - the TC will post on all FPLP modules. The "match" TC 971 AC 062 will generate the FPLP notice process discussed below.

If the TC 971 AC 062 DLN indicates levy - then the TC will only post on the module intended for the levy payment. See IRM 5.11.7.3.3.5, Levy Payment Process.

The FPLP notice process generates four notices by the IRS - a pre-levy Collection Due Process (CDP) notice, a FPLP final notice for Social Security beneficiaries, a FPLP (DETL) post-levy CDP notice, and a FPLP (FEDCON Levy) post-levy CDP notice. This subsection describes their systemic processes and IRM 5.11.7.3.4, FPLP Generated Notices and Appeal Rights, describes the notices in detail.

If a TC 971 AC 062 DLN match is posted, then Master File will systemically verify if a Intent to seize your assets and notice of your right to a hearing (CDP notice) had been issued by identifying an unreversed TC 971 AC 069 on the module. If a CDP notice was not issued, then Master File will systemically generate a FPLP CDP final notice, either the Computer Paragraph notice (CP) 90 (IMF) or 297 (BMF), prior to the levy and post a TC 971 AC 069 on the module. On the IMF, the appropriate SSN(s) will be displayed on the TC 971 AC 069 XREF field.

If the match identifies a Social Security benefit payment, and an unreversed TC 971 AC 069 had been posted for at least ten cycles (weeks), then prior to the levy, Master File will systemically generate an additional final notice to the Social Security beneficiaries, either CP 91 (IMF) or 298 (BMF), Intent to seize up to 15% of your Social Security benefits and post a TC 971 AC 169 on the module. The TC 971 AC 169 will display the TIN of the individual that matched with the Social Security payment.

The FPLP may issue systemic CDP notices after a DETL or FEDCON levy - known as post-levy CDP notices:

Another taxpayer notice is issued by BFS when a Federal payment is levied. See IRM 5.11.7.3.3.5, Levy Payment Process, below.

The FPLP will transmit (or "serve" ) a levy to BFS in the following situations.

FPLP Levy (Pre-levy CDP notice issued) - TC 971 AC 662

FPLP Disqualified Employment Tax Levy (DETL) (Post-levy CDP issued) - TC 971 AC 762: For federal payments other than Social Security or RRB benefit payments, a FPLP DETL levy may also be transmitted to BFS on qualified BMF employment tax modules with MFT 01, 10, 11, 14 and 16. A TC 971 AC 762 will post on the module, which will generate a post-levy CDP notice CP 297A and post a TC 971 AC 069. The taxpayer is provided their CDP appeal rights after the levy. See IRM 5.11.7.3.3.3, FPLP Notice Process (TC 971 AC 069 or AC 169).

FPLP Federal Contractor Levy (FEDCON) (Post-levy CDP issued) - TC 971 AC 677: For federal payments other than Social Security or RRB benefit payments, a FPLP FEDCON levy may be issued to BFS on all BMF tax modules and IMF tax modules (excluding filing status 2, married filing joint modules) if the entity is identified as a Federal contractor with an unreversed TC 971 AC 647 posted on the entity. A TC 971 AC 677 will post on the module with the literals "SAL, OTH" displayed in the Miscellaneous Field. This will generate a post-levy CDP notice CP 90C (or 297C) and post a TC 971 AC 069. The taxpayer is provided their CDP appeal rights after the levy. See IRM 5.11.7.3.3.3, FPLP Notice Process (TC 971 AC 069 or AC 169).

Depending on a tax module’s levy qualifications, a single tax module could have any of the levy action codes at various times, particularly if the module goes in and out of the FPLP; or a taxpayer’s multiple modules may each have different levy codes occurring at the same time.

The FPLP DETL (TC 971 AC 762) and FEDCON (TC 971 AC 677) levy processes occur after the issuance of a CP 504 on DETL modules. The issuance of the CP 504 meets the 30-day pre-levy requirement of IRC 6331(d). Also, if a tax module qualifies for both a DETL and FEDCON levy during the same cycle, then the DETL (TC 971 AC 762) will be selected first.

For joint income tax and sole proprietor tax liabilities, the FPLP levy cannot be issued only on one TIN of these modules. All TINs in the tax modules or entity will be levied for their appropriate matched payments. The same process will occur when releasing a FPLP levy on these particular modules. See IRM 5.11.7.3.6, Blocking or Releasing FPLP Levy.

For taxpayers who have multiple tax periods in either the IMF and/or BMF, the levy should only subject their federal payment against one tax module at a time. That taxpayer's payment will not be levied more than the appropriate FPLP levy percentage to pay more than one tax module at a time, regardless if the taxpayer's TIN is the primary, secondary and/or XREF TIN on any tax module.

If the FPLP levy is released, a TC 972 AC 060 will display to indicate the account is removed from the FPLP. A TC 972 AC 662/762/677 will not display.

BFS has to process the various types of federal payment files within its processing cycles in order to meet the various payment or disbursement dates. The levy must be processed by the cutoff date for it to attach the payment by the payment date. The levy payment is then transmitted to the IRS and posted on the account on the taxpayer's payment date.

BFS lets IRS know that the levy is being processed against a federal payment by a TC 971 AC 062, with its DLN indicating a levy payment processed (or "1" in the 13th DLN position) for that module. See Exhibit 5.11.7-5, TC 971 AC 062 (DLN) and Miscellaneous Field Format, for additional specific payment agency information .

The payment will post on the payment date with a TC 670 DPC 18 (payment from the primary TIN) and/or DPC 19 (payment from the secondary or XREF TIN) when BFS transmits the payment to the IRS through the Electronic Federal Tax Payment System (EFTPS).

Most of the FPLP levy payments will be 15% of the federal payment (or balance due, whichever is less). The exception will be on federal contractor or vendor payments, i.e. account receivables, invoice payments, from taxpayers doing business with the government, which will be 100% of the payment. See IRM 5.11.7.3.1.1, IRS/BFS Interagency Agreement - Federal Payments Subject to the FPLP.

BFS will then send a notice to the taxpayer indicating the federal payment has been reduced because of the IRS FPLP levy. See IRM 5.11.7.3.4.1, BFS Notice to Taxpayers, and Exhibit 5.11.7-7, Department of the Treasury, Bureau of the Fiscal Service Notice.

Inter-agency processing and timing constraints may delay some actions in this levy payment process:

BFS may systemically reverse a TC 670 DPC 18 or DPC 19 payment with TC 672 DPC 18 or DPC 19 when the federal payment agency determines the taxpayer was not entitled to the payment. See IRM 5.11.7.3.7, Returning FPLP Levy Proceeds.

Once BFS processes the IRS database against its payment disbursement files, then BFS will transmit the proceeds to IRS and send the remaining disbursement to the taxpayer along with a notice indicating the federal payment has been levied. Exhibit 5.11.7-7, Department of the Treasury, Bureau of the Fiscal Service Notice, displays the following information on the notice:

Whenever the FPLP indicator is present on a module, revenue officers may decide to levy the federal payment source through the FPLP under IRC 6331(h) or through the traditional paper levy method using Form 668A or Form 668W under IRC 6331(a) or 6331(e). The FPLP will attach the applicable 15% or 100% of the payment continuously through BFS as the central or disbursing agent for the federal payment source. The paper levy method under IRC 6331(a), Levy and distraint, or IRC 6331(e) Continuing levy on salary and wages, using the Notice of Levy, Form 668-A or Form 668-W, respectively, will levy the federal payment source directly and attach the maximum amount allowed under those statutes. The maximum amount of levy proceeds received from either levy method will depend on the type of federal payment expected. Form 668-A or Form 668-W may not be used as a means to levy under the FPLP statute, IRC 6331(h).

Form 668-A or Form 668-W will have to be served or issued on the federal agency directly, not BFS. Prior to levying the federal agency with Form 668-A or Form 668-W on either the primary or secondary taxpayer, the revenue officer must release or block the module from FPLP . See IRM 5.11.7.3.6, Blocking or Releasing FPLP Levy.

Form 668-A or Form 668-W may be used as a levy tool on a case, in addition to the FPLP, as long as the Form 668A/W is not served on a federal payment source. For example, a Form 668-A may be sent to a bank account, even if the taxpayer's federal payment is subject to the FPLP. If the Form 668-A or Form 668-W is served on a federal payment source, and the taxpayer is also in the FPLP, then there is a chance the FPLP may also levy the same federal payment source - which is prohibited based on the previous paragraph.

Revenue officers cannot close a case module as a continuous FPLP levy using a Status 60 input. Status 60 is normally used for continuous levies or installment agreements. The FPLP excludes Status 60 modules. In order to close a case that has an active FPLP levy module, then consider the following:

Continuous levies under IRC 6331(e) on the federal payment agency may still be issued using Form 668-W, and placed in Status 60. See IRM 5.11.5, Notice of Levy, Levy on Wages, Salary and Other Income.

For cases in Status 26, selected Collection Advisory office will have a designated FPLP coordinator who will have real-time secured web access to the BFS database system in order to temporarily release or "rescind" a levy during certain situations discussed below. On the IRS intranet Servicewide Electronic Research Program (SERP) page, under "Who/Where" , the FPLP coordinators can be identified based on taxpayer’s geographical location.

As discussed in the previous subsection, a FPLP levy is released by posting a FPLP exclusion TC (i.e. Status 60) or FPLP block (TC 971 AC 061) on the account. Those TCs will generate the TC 972 AC 060 indicating the FPLP levy is released. If the TC 972 AC 060 has not yet posted to release the levy and the taxpayer's next payment is imminent, then to avoid that payment from being levied, a levy release request to the FPLP coordinator may be necessary. (See IRM 5.11.7.3.6.2, FPLP Coordinator Duties.) The FPLP coordinator may be able to 'rescind' the levy through the BFS database system in time to save the next payment from being levied but only if there is still time to input the 'rescind' action prior to the payment processing cutoff chart discussed above. The "rescind" input must be completed before the payment cutoff date as discussed above in IRM 5.11.7.3.6 (7). Most of the time, the FPLP coordinator 'rescind' action can be done only on payments paid 'monthly', such as the OPM retirement payments or SSA benefit payments. Since federal salaries and contractor/vendor payments are paid more often and their processing cutoff dates shortened or unknown, then the systemic levy release will usually not be effective until after 2 cycled pay dates.

The levy "rescind" on the BFS database is temporary only, and effective at the time of the input until the next time the BFS database is updated with taxpayer information from the Master File, which is usually every week. The FPLP coordinator's "rescind" input in the BFS database will not upload to IDRS or MF.

To release a FPLP levy through the FPLP coordinator's rescind input in the above situations, prepare Form 4844 and send it to the FPLP coordinator. Call the FPLP coordinator to ensure receipt of Form 4844, and keep a copy of the form. Indicate on Form 4844:

Certain case situations that may warrant a FPLP coordinator release are, but not limited to:

As indicated above, selected Collection Advisory offices have a designated FPLP coordinator who will have on-line and real-time access to the BFS database system in order to temporarily release or "rescind" a levy during certain situations.

FPLP coordinators will have and should maintain their computer web access to the BFS website, known as the Treasury Offset Program (TOP) taxpayer database, in order to input (aka "rescind" ) emergency or stop-gap FPLP levy release requests. On the IRS intranet Servicewide Electronic Research Program (SERP) page, under "Who/Where" , the appropriate FPLP coordinator can be identified for each case.

The FPLP coordinators are not required to input the TC 971 AC 061 block/release or any other TC excluding the account from the FPLP. It is the responsibility of the operational/functional (i.e. Collection Field, TAS, TAC) employee resolving the case to input or forward it to the appropriate unit, i.e. Case Processing.

Form 4844 will serve as the input document for the FPLP coordinator. The coordinator will sign onto the BFS system and rescind all the modules from the levy.

Requests for FPLP levy rescinds must be input within one (1) workday from receipt.

The original Form 4844 will be annotated with the date and time that the release was input into the BFS database and maintained in a file for 30 days.

The FPLP coordinator is not responsible for authorizing the levy release.

Coordinators should also provide subject matter support for the operating and functional divisions, and should also contact the FPLP headquarters staff for clarity and guidance.

In rare instances and under the guidance of FPLP headquarters staff, the coordinators may be delegated to coordinate FPLP case-related recovery efforts of systemic erroneous levy situations or expedited case handling. See IRM 5.11.7.3.6.3, Additional FPLP Coordinator Duties for Certain Expedited Case Handling.

FPLP headquarters will initiate these necessary steps with the local FPLP coordinator, in order to facilitate expedited case handling of certain FPLP cases.

The local FPLP coordinator will open a NFOI 148, Lien Priority Other, note the case history and initiate a mandatory outgoing Advisory Courtesy Investigation to the collection field function (or to the assigned revenue officer of the case), in order to make contact with the taxpayer. The group manager assigning the investigation should advise the revenue officer that because of the sensitive nature of the investigation, contact with the taxpayer will generally be made within three (3) work days from receipt.

The following subsections outline the rare situations and procedures that require expedited case handling through the FPLP coordinator.

Revenue officers may manually reverse any TC 971 AC 061 with a TC 972 AC 061, at anytime during their collection case strategy in order to place the module into the FPLP. (The DLN in the TC 972 AC 061 will display a random series of numbers.) The module should then be systemically selected into the FPLP, as along as the FPLP selection criteria is met. See IRM 5.11.7.3.2, FPLP Selection Criteria. See IRM 5.11.1.3.1, Pre-Levy Considerations, if appropriate.

There are also systemic criteria that determine when the FPLP TC 971 AC 061 block is reversed with TC 972 AC 061: