Purpose. This chapter discusses the installment agreement (IA) process for cases with special circumstances and withdrawals of IA requests. While many topics are touched upon in this chapter, comprehensive guidance about all of them cannot always be included here. As you use this chapter, remain alert for references to other resources, such as related IRMs and websites. Access that guidance, as needed, to ensure a thorough understanding of topics. This IRM provides guidance, you will be able to:

Audience. These procedures and guidance apply to IRS Field Collection employees and group managers

Policy Owner. Director, Collection Policy, SBSE

Program Owner. Collection Policy, SBSE, Case Resolution Alternatives (CRA) is the program owner of this IRM

Primary Stakeholders:

Program Goals. IAs can be a viable case resolution for many delinquent accounts. By following the direction in this IRM section, employees can identify proper procedures for completing IA actions for cases with special circumstances.

Notice status balance due accounts less than the amount specified in IRM 5.16.1.2.5, Tolerance, may be input to IA status for an unspecified period of time provided:

The agreements discussed in IRM 5.14.4.2 may be taken if:

Prepare Form 433-D, Installment Agreement, or Form 2159, Payroll Deduction Agreement (levy source information is not required on these agreements), process per the guidance provided in IRM 5.14.9.4, Routine Installment Agreements . (See also IRM 5.14.9.3, IDRS Monitoring)

If the taxpayer doesn’t have the ability to make IA payments, then the alternative would be to:

Reporting Accounts Uncollectible: If taxpayers are unable to make regular monthly payments based on analysis of the Collection Information Statement (CIS), then consider reporting the accounts uncollectible. For additional information about reporting accounts uncollectible, refer to IRM 5.16.1, Currently Not Collectible. Provide taxpayers with the address at the Campus where the taxpayer files returns (for mailing voluntary payments). Taxpayers who are unable to make payments generally should not be granted IAs.

If taxpayers are able to make payments, but unable to fully pay all balance due accounts, then Partial Payment Installment Agreements (PPIAs) may be considered. See IRM 5.14.2.2.1, Partial Payment Installment Agreement Requirement Requirements, for procedures.

Related entities can be included in one IA. The agreement locator number will auto-populate on ICS to XX63, when there is an associated cross-reference account, that is, one account in ST 60 (primary) and the other in ST 63 (secondary). Cross-reference IAs can be a combination of IMF/BMF or IMF/IMF. The ALN ensures proper systemic monitoring of these agreements.

For IAs involving cross-references, ensure the taxpayer entities are in filing and payment compliance (follow the procedures as outlined in IRM 5.14.1.4, Installment Agreement Acceptance and Rejection Determinations ), prior to requesting the pending IA indicator. See IRM 5.14.1.3(5), Identifying Pending, Approved and Rejected Installment Agreement Proposals on IDRS for guidance. When the pending IA indicator is present (TC 971 AC 043) on the entity and one of the taxpayers is not in compliance at the time the IA is ready to be granted, a recommendation for rejection can be given to the IAR regarding only the person or entity that is not in compliance, and the taxpayer that is in compliance may be granted an IA (if appropriate). The following types of taxes may be combined in one IA:

When a request for an IA involves a SSN and EIN (Sole Proprietor) or two SSN's, some years filed joint and some single, combine the aggregate unpaid balance of assessment (CC SUMRY) of all modules. Determine if the taxpayer meets the requirements to qualify for an IA. An IMF account and related BMF account must be included in one IA.

Select the correct IA type based on the combined aggregate unpaid balance of assessments (SUMRY) of all the modules on the related entities. The correct IA type is based on the dollar threshold and type of tax governed by the IA type (Streamlined, IBTF-Express, IBTF-IA).

For IAs on multiple entities:

IAs with a cross-reference TIN (xx63) cannot be systemically uploaded. ICS will block the input. Process this type of agreement by e-mailing the Form 433-D, Installment Agreement, to the appropriate CCP mailbox (see below) or mail it on a Form 3210, Document Transmittal, to CCP at Mail Stop 5-E04.114.

For certain liabilities assessed in the name and EIN of an LLC, different Single Member Owners (SMOs) may be liable for separate tax periods assessed in the same name and EIN. See IRM 5.1.21, Collecting from Limited Liability Companies . If multiple SMOs are liable for different tax periods assessed in the same name and EIN separate IAs would be required for each taxpayer and should be established using the Manually Monitored procedures in IRM 5.14.9.5, Manually Monitored Installment Agreements (MMIA).

Ensure a TC130 is input for the appropriate Social Security Number(s).

Married taxpayers who file joint tax returns are each responsible for all taxes due related to the jointly filed returns, even if they later divorce and even if a divorce decree or marital settlement agreement states that one taxpayer alone will be responsible, in full or in part, for amounts due on previously filed joint returns. This means the IRS can collect all the taxes due from either taxpayer, regardless of the income either taxpayer earned. If one of the taxpayers requests separate treatment from his or her spouse under IRC 6015, and only one taxpayer wishes to enter into an IA, the account must be "mirrored" for each joint period(s). See IRM 25.15, for information about relief from joint and several liability under IRC 6015.

The tax account mirroring process is used to create two separate MFT 31 accounts from the MFT 30 joint tax liability. After January 1, 2016, individual SRP modules (MFT 35) may be mirrored when applicable. Any associated SRP MFT 35 is mirrored into a MFT 65 account for each spouse. The mirroring effect allows the IRS to treat each taxpayer separately and ensures the rights of both taxpayers are protected. .

If the spouse who does not request IRC 6015 relief from the liability the non-requesting spouse requests an IA, and there is an unreversed TC 971 AC 065 on any balance due module or a MFT 31 has been established, then:

If the spouse applying for IRC 6015 relief requests an IA and there is an unreversed TC 971 AC 065 on any balance due module, then:

To input pending IA codes (TC 971 AC 043) or IA codes (TC 971 AC 063), when an unreversed TC 971 AC 065 already exists on a tax module:

Taxpayers may withdraw installment agreement (IA) requests either verbally or in writing.

Requests to withdraw an IA request are only applicable to pending IAs, and typically requested when another case closing action is determined to be the appropriate case resolution (Full payment, OIC, CNC, etc.)

In the case of a joint assessment, if the withdrawal is only requested by one spouse, the collection employee should determine the intent of the other spouse if other than a full pay resolution. If the other spouse wishes to continue with the IA request, the accounts should be mirrored so that separate collectibility determinations can be made.

When a request to Withdraw an IA has been received, complete Form 14425 , Withdrawal of Request for Installment Agreement, and document ICS:

Verbal requests are effective five (5) calendar days from the day they are received unless a written confirmation of a verbal request is received within the five (5) day period. Taxpayers should be advised that by withdrawing their IA request, appeal rights with respect to that pending IA are extinguished, however, taxpayers can propose a new IA at any time.

Cases received with a pending IA indicator must be dealt with even if the case is resolved without either approving or rejecting the IA. Other situations where a Withdrawal of IA request should be addressed, include full payment, OIC, CNC, CDP, and Bankruptcy. Requests for IAs are considered withdrawn (i.e., withdrawals are effective):

Withdrawals should not be solicited by contact employees, but questions may be asked to clarify misunderstanding of taxpayers’ statements.

Request input of TC 972 AC 043 (if a TC 971 AC 043 was previously input) on the effective date of the withdrawal. If the case has already been input into IA status, then:

If the IA request was a joint request on a jointly filed return, both taxpayers must sign one request or separate requests for withdrawal for the request to be honored.

No independent review is required in the case of withdrawals. (See IRM 5.14.9.7(19), Independent Administrative Review after Recommended Rejection of Installment Agreement Requests)

For background information on Restitution Based Assessments (RBAs) - see IRM 5.1.5.15.3, Restitution Based Assessments.

ROs may receive an OI from an APL or a balance due module assignment to conduct a field investigation on a RBA.

Civil assessments with associated RBAs may be received in any Collection work stream (Field, Campus, Automated Collection System) but may only be worked by ROs.

IAs for RBAs can only be considered if the proposed IA will result in the full payment of the RBA within the terms of the IA and by the CSED. Any open civil assessment should be included in the IA, even if the payment agreement won’t result in full payment of those civil assessments. CCP will determine if the IA is a PPIA once the RBAs are paid in full.

IAs that include RBAs should only be established by ROs. If there is an open Conditions of Probation (COP) case, the RO should coordinate the establishment of the IA with the APL.

In the event the taxpayer’s ability to pay will not result in the full payment of the RBA, MMIAs for civil assessments (including PPIAs) can be established exclusive of RBA assessments (that is, the RBA is not included as part of the IA) in cases where the taxpayer’s income/expense analysis shows an ability to pay above the allowable expenses (which will include the court ordered restitution payment). The RBA modules should be reported as CNC using closing code 32.

This section relates to actions required when establishing IAs, which includes: the excise tax MFT 76 module and/or failure to file penalty MFT 74 assessment.

MFT 74 identifies the tax module in which an adjustment for Form 5500 (series), Annual Return/Report of Employee Benefit Plan, is to post. Form 5500 concerns compliance with qualification provisions. For Form 5500 penalties (e.g., late filing). See IRM 20.1.8.4 , Employee Plans (EP).

MFT 76 identifies the tax module in which an adjustment for Form 5330, Return of Excise Taxes Related to Employee Benefit Plans, is to post. Form 5330 is used to report and pay the excise tax related to employee benefit plans under several IRC provisions. The largest assessments usually relate to inadequate funding of employee pension plans. A tax of 10 percent [4971(a)] of the underfunded amount may apply each year. A tax of 100 percent [4971(b)] can be imposed in certain cases. The tax may be self-reported on Form 5330, or identified by IRS in an Examination proceeding.

Currently, due to programming limitations, the systemic input of certain transaction codes to a MFT 74/76 module is not possible due to the 3-digit plan identifier associated with these assessments. Automated systems do not recognize the identifier number. Notices requesting payment are sent when the tax is assessed and every time interest is updated, but the cases do not move beyond status 21. Sometimes no status is reflected on IDRS, just the assessment.

Research of these modules requires a specific format which include:

IAs which include MFT 74 or 76 cannot be systemically established on IDRS; they must be processed following MMIA procedures. See IRM 5.14.9, Routine and Manually Monitored Installment Agreements, Independent Review and Appeals. Clearly identify the IA as "MMIA - MFT 74/76" in red on the top of the IA.

If the entity has other assessments (i.e. MFT 01, 02, 10, etc.) and those modules will not be fully satisfied (taxpayer placed in a Partial Payment IA), do not create a separate IA for CCP manual monitoring. If the taxpayer has a systemically monitored IA that will result in full payment of the other assessments, create a separate IA for manual monitoring in CCP. Clearly document the Form 433-D and the ICS history that both a systemic and MMIA exist and that payments will post to the non-MFT 74/76 assessments until full payment is received.

Request input of a TC 971, AC 063 on each MFT 74/76 module at the time the MMIA is forwarded to CCP.

If a NFTL is required, follow the instructions outlined in IRM 5.12.7.7.6, Employee Benefit Plans.