Agreements for Payment of Tax Liabilities in Installments, 9712-9716 [E7-3730]
Download as PDF
<![CDATA[
9712
Federal Register / Vol. 72, No. 42 / Monday, March 5, 2007 / Proposed Rules
Authority: Secs. 702(a)(5), 1147, 1601,
1602, 1611(c) and (e), and 1631(a)–(d) and (g)
of the Social Security Act (42 U.S.C.
902(a)(5), 1320b–17, 1381, 1381a, 1382(c)
and (e), and 1383(a)–(d) and (g)); 31 U.S.C.
3720A.
2. Section 416.557 is added to read as
follows:
erjones on PRODPC74 with PROPOSALS
§ 416.557
Personal conference.
(a) If waiver cannot be approved (i.e.,
the requirements in § 416.550 (a) and (b)
are not met), the individual is notified
in writing and given the dates, times
and place of the file review and
personal conference; the procedure for
reviewing the claims file prior to the
personal conference; the procedure for
seeking a change in the scheduled dates,
times and/or place; and all other
information necessary to fully inform
the individual about the personal
conference. The file review is always
scheduled at least 5 days before the
personal conference. We will offer to the
individual the option of conducting the
personal conference face-to-face at a
place we designate, by telephone, or by
video teleconference. The notice will
advise the individual of the date and
time of the personal conference.
(b) At the file review, the individual
and the individual’s representative have
the right to review the claims file and
applicable law and regulations with the
decisionmaker or another of our
representatives who is prepared to
answer questions. We will provide
copies of material related to the
overpayment and/or waiver from the
claims file or pertinent sections of the
law or regulations that are requested by
the individual or the individual’s
representative.
(c) At the personal conference, the
individual is given the opportunity to:
(1) Appear personally, testify, crossexamine any witnesses, and make
arguments;
(2) Be represented by an attorney or
other representative (see § 416.1500),
although the individual must be present
at the conference; and
(3) Submit documents for
consideration by the decisionmaker.
(d) At the personal conference, the
decisionmaker:
(1) Tells the individual that the
decisionmaker was not previously
involved in the issue under review, that
the waiver decision is solely the
decisionmaker’s, and that the waiver
decision is based only on the evidence
or information presented or reviewed at
the conference;
(2) Ascertains the role and identity of
everyone present;
(3) Indicates whether or not the
individual reviewed the claims file;
VerDate Aug<31>2005
15:28 Mar 02, 2007
Jkt 211001
(4) Explains the provisions of law and
regulations applicable to the issue;
(5) Briefly summarizes the evidence
already in file which will be considered;
(6) Ascertains from the individual
whether the information presented is
correct and whether he/she fully
understands it;
(7) Allows the individual and the
individual’s representative, if any, to
present the individual’s case;
(8) Secures updated financial
information and verification, if
necessary;
(9) Allows each witness to present
information and allows the individual
and the individual’s representative to
question each witness;
(10) Ascertains whether there is any
further evidence to be presented;
(11) Reminds the individual of any
evidence promised by the individual
which has not been presented;
(12) Lets the individual and the
individual’s representative, if any,
present any proposed summary or
closing statement;
(13) Explains that a decision will be
made and the individual will be notified
in writing; and
(14) Explains repayment options and
further appeal rights in the event the
decision is adverse to the individual.
(e) SSA issues a written decision to
the individual (and his or her
representative, if any) specifying the
finding of fact and conclusions in
support of the decision to approve or
deny waiver and advising of the
individual’s right to appeal the decision.
If waiver is denied, adjustment or
recovery of the overpayment begins
even if the individual appeals.
(f) If it appears that the waiver cannot
be approved, and the individual
declines a personal conference or fails
to appear for a second scheduled
personal conference, a decision
regarding the waiver will be made based
on the written evidence of record.
Reconsideration is then the next step in
the appeals process.
[FR Doc. E7–3782 Filed 3–2–07; 8:45 am]
BILLING CODE 4191–02–P
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 301
[REG–100841–97]
RIN 1545–AU97
Agreements for Payment of Tax
Liabilities in Installments
Internal Revenue Service (IRS),
Treasury.
AGENCY:
PO 00000
Frm 00005
Fmt 4702
Sfmt 4702
Withdrawal of notice of
proposed rulemaking and notice of
proposed rulemaking.
ACTION:
SUMMARY: This document withdraws the
notice of proposed rulemaking
published in the Federal Register on
December 31, 1997 (62 FR 68241) and
contains proposed regulations relating
to the payment of tax liabilities in
installments. The proposed regulations
reflect changes to the law made by the
Taxpayer Bill of Rights II, the Internal
Revenue Service Restructuring and
Reform Act of 1998, and the American
Jobs Creation Act of 2004.
DATES: Written or electronic comments
and requests for a public hearing must
be received by June 4, 2007.
ADDRESSES: Send submissions to:
CC:PA:LPD:PR (REG–100841–97), room
5203, Internal Revenue Service, POB
7604, Ben Franklin Station, Washington,
DC 20044. Submissions may be hand
delivered Monday through Friday
between the hours of 8 a.m. and 4 p.m.
to: CC:PA:LPD:PR (REG–100841–97),
Courier’s Desk, Internal Revenue
Service, 1111 Constitution Avenue,
NW., Washington, DC. Alternatively,
taxpayers may submit comments
electronically directly to the IRS
Internet site at https://www.irs.gov/regs
or via the Federal eRulemaking Portal at
https://www.regulations.gov (indicate
IRS and REG–100841–97).
FOR FURTHER INFORMATION CONTACT:
Concerning the regulations, G. William
Beard, (202) 622–3620; concerning
submissions of comments or requests for
a hearing, Kelly Banks, (202) 622–7180
(not toll-free numbers).
SUPPLEMENTARY INFORMATION:
Background
On December 31, 1997, a notice of
proposed rulemaking (REG–100841–97;
62 FR 68241) reflecting changes made to
section 6159 of the Internal Revenue
Code (Code) by section 202 of the
Taxpayer Bill of Rights II, Pub. L. 104–
168 (110 Stat. 1452, 1457) was
published in the Federal Register. That
proposed rule was not acted upon prior
to the enactment of the Internal Revenue
Service Restructuring and Reform Act of
1998 (RRA 1998), Pub. L. 105–206,
section 3462 (112 Stat. 685, 764), which
made further amendments to section
6159. Section 843 of the American Jobs
Creation Act of 2004 (AJCA), Pub. L.
108–357 (118 Stat. 1418, 1600), also
made changes to section 6159. This
document amends the prior notice of
proposed rulemaking. It contains
proposed amendments to the Procedure
and Administration Regulations (26 CFR
part 301) under section 6159 reflecting
E:\FR\FM\05MRP1.SGM
05MRP1
Federal Register / Vol. 72, No. 42 / Monday, March 5, 2007 / Proposed Rules
the amendment of the Code by RRA
1998, the Taxpayer Bill of Rights II, and
the AJCA.
erjones on PRODPC74 with PROPOSALS
Installment Agreements Under Section
6159
Consistent with its mission of
applying the tax laws with integrity and
fairness to all, the IRS generally expects
that all taxpayers will pay the total
amount due, regardless of amount, at
the time the Code requires that the tax
be paid. See Policy Statement P–5–2,
Collecting Principles (Approved
February 17, 2000), reprinted at IRM
1.2.1.5.2. When attempting to resolve a
tax delinquency, the IRS will work with
taxpayers to achieve full payment of all
tax, penalties, and interest. Where
payment in full cannot immediately be
achieved, the IRS may allow taxpayers
to pay over time through installment
agreements.
Explanation of Provisions
The proposed regulations allow the
IRS to enter into agreements for the full
or partial payment of any unpaid tax in
installments. The regulations provide
rules for the submission of proposed
installment agreements, the processing,
acceptance, and rejection of such
agreements by the IRS, the termination
or modification of existing agreements,
and the appeal of rejections,
modifications, and terminations to the
IRS Office of Appeals (Appeals). The
majority of these provisions are
unchanged from what was contained in
the prior regulations or reflect
longstanding IRS administrative
practice. The rules regarding when a
proposed installment agreement
becomes pending, restrictions on
collection activity while an agreement is
pending or in effect, and the suspension
of the statute of limitations for
collection are nearly identical to the
provisions in existing § 301.6331–4. The
only change was a clarification that the
IRS will not be precluded from filing
suit or a proof of claim in bankruptcy
for the full amount of the liabilities
owed, regardless of whether the
installment agreement provides for full
or partial payment of the liabilities at
issue.
Taxpayers may request administrative
review of IRS decisions to modify or
terminate installment agreements
pursuant to section 6159(e), added to
the Code by section 202 of the Taxpayer
Bill of Rights II. Taxpayers may appeal
rejections of proposed installment
agreements under section 7122(d),
added to the Code by section 3462 of
RRA 1998. The proposed regulations
allow taxpayers to appeal a termination,
modification, or rejection of an
VerDate Aug<31>2005
15:28 Mar 02, 2007
Jkt 211001
installment agreement to Appeals
provided they request the appeal in the
manner specified by the IRS.
The previous notice of proposed
rulemaking contained a more detailed
procedure for seeking review of
decisions to terminate or modify
agreements. That proposed regulation
has not been adopted. These regulations
contain a less detailed procedure
because procedures for appealing differ
depending on the IRS operating division
handling the case, the size of the tax
liability, or the type of tax at issue. For
example, some taxpayers may be able to
request an appeal by telephone while
others will be required to submit a
formal written request. See Publication
1660, Collection Appeal Rights.
The proposed regulations incorporate
the provisions of section 6159(c), added
to the Code by section 3467 of RRA
1998. That section requires the IRS to
accept a proposed installment
agreement for income taxes under
certain circumstances. The regulations
also incorporate section 3506 of RRA
1998, which requires the IRS to send
each taxpayer with an installment
agreement an annual statement showing
the balance due at the beginning of the
year, the payments made during the
year, and the remaining balance due at
the end of the year.
Section 843 of the AJCA amended
section 6159(a) to allow the IRS to enter
into installment agreements that provide
for partial (as well as full) payment of
a tax liability. The proposed regulations
incorporate this change. Because a
partial payment installment agreement
could be confused with a compromise of
the liability, the proposed regulations
clarify that an installment agreement
does not reduce the amount of taxes,
interest, or penalties owed. See H. Rep.
No. 108–755, 108th Cong., 2d Sess.,
2005 U.S.C.C.A.N. 1341 (October 7,
2004).
The proposed regulations also clarify
that the IRS may enter into an
installment agreement that, by its terms,
ends upon the expiration of the period
of limitations on collection in section
6502 and § 301.6502–1, or at some prior
date. A partial payment installment
agreement that ends prior to the
expiration of the collection period of
limitations would allow the IRS to
collect the balance of the tax liability
against any property belonging to the
taxpayer or request the Department of
Justice to institute a judicial action to
reduce the liability to judgment or take
other actions to enforce the federal tax
lien. The proposed regulations do not
limit the authority of the IRS to enter
into partial payment installment
PO 00000
Frm 00006
Fmt 4702
Sfmt 4702
9713
agreements that run to the end of the
collection period.
Section 843 of the AJCA amended
section 6159(c) to exclude partial
payment installment agreements from
the scope of installment agreements that
must be accepted by the IRS. The
proposed regulations provide that
installment agreements guaranteed
under section 6159(c) must provide for
the full payment of the liabilities.
Section 843 of the AJCA added new
section 6159(d), requiring the IRS to
review partial payment installment
agreements every two years. (Former
subsections (d) and (e) were
redesignated (e) and (f).) The primary
purpose of the review is to determine
whether the financial condition of the
taxpayer has significantly changed so as
to warrant an increase in the value of
the payments being made. See H. Rep.
No. 108–755, 108th Cong., 2d Sess.,
2005 U.S.C.C.A.N. 1341 (October 7,
2004). The proposed regulations reflect
this requirement.
The proposed regulations clarify the
application of payments made pursuant
to installment agreements. Consistent
with Revenue Procedure 2002–26
(2002–1 C.B. 746), all payments will be
applied in the best interests of the
Government, unless the installment
agreement provides otherwise. Current
regulations provide rules for when the
IRS may terminate an agreement but do
not expressly provide that a taxpayer
and the IRS may agree to end an
agreement. The proposed regulations
clarify that an installment agreement
may be terminated by agreement
between the taxpayer and the IRS, or
may be superceded by a new agreement.
Proposed Effective Date
These regulations are proposed to be
effective upon publication in the
Federal Register of the final regulations.
Special Analyses
It has been determined that this notice
of proposed rulemaking is not a
significant regulatory action as defined
in Executive Order 12866. Therefore, a
regulatory assessment is not required. It
also has been determined that section
553(b) of the Administrative Procedure
Act (5 U.S.C. chapter 5) does not apply
to these regulations and, because these
regulations do not impose a collection
of information under the Paperwork
Reduction Act (44 U.S.C. 3501), the
Regulatory Flexibility Act (5 U.S.C.
chapter 6) does not apply to these
regulations. Pursuant to section 7805(f)
of the Code, this notice of proposed
rulemaking will be submitted to the
Chief Counsel for Advocacy of the Small
E:\FR\FM\05MRP1.SGM
05MRP1
9714
Federal Register / Vol. 72, No. 42 / Monday, March 5, 2007 / Proposed Rules
Business Administration for comment
on its impact on small business.
Comments and Requests for a Public
Hearing
Before these proposed regulations are
adopted as final regulations,
consideration will be given to any
written comments (a signed original and
eight (8) copies) or electronic comments
that are submitted timely to the IRS. The
IRS generally requests any comments on
the clarity of the proposed rule and how
it may be made easier to understand. All
comments will be available for public
inspection and copying. A public
hearing may be scheduled if requested
in writing by a person that timely
submits written or electronic comments.
If a public hearing is scheduled, notice
of the date, time, and place for the
hearing will be published in the Federal
Register.
Drafting Information
The principal author of these
regulations is G. William Beard, Office
of Associate Chief Counsel (Procedure
and Administration), Collection,
Bankruptcy & Summonses Division.
List of Subjects in 26 CFR Part 301
Employment taxes, Estate taxes,
Excise taxes, Gift taxes, Income taxes,
Penalties, Reporting and recordkeeping
requirements.
Withdrawal of Proposed Regulations
Accordingly, under the authority of
26 U.S.C. 7805, the notice of proposed
rulemaking (REG–100841–97) that was
published in theFederal Register on
December 31, 1997 (62 FR 68241) is
withdrawn.
Proposed Amendments to the
Regulations
Accordingly, 26 CFR part 301 is
proposed to be amended as follows:
PART 301—PROCEDURE AND
ADMINISTRATION
Paragraph 1. The authority citation
for part 301 continues to read in part as
follows:
Authority: 26 U.S.C. 7805 * * *
Par. 2. Section 301.6159–0 is added to
read as follows:
erjones on PRODPC74 with PROPOSALS
§ 301.6159–0
Table of contents.
This section lists the major captions
that appear in the regulations under
§ 301.6159–1.
§ 301.6159–1 Agreements for the payment
of tax liabilities in installments.
(a) Authority.
VerDate Aug<31>2005
15:28 Mar 02, 2007
Jkt 211001
(b) Procedures for submission and
consideration of proposed installment
agreements.
(c) Acceptance, form, and terms of
installment agreements.
(d) Rejection of a proposed installment
agreement.
(e) Modification or termination of installment
agreements by the Internal Revenue
Service.
(f) Effect of installment agreement or pending
installment agreement on collection
activity.
(g) Suspension of the statute of limitations on
collection.
(h) Annual statement.
(i) Biannual review of partial payment
installment agreements.
(j) Cross reference.
(k) Effective date.
Par. 3. Section 301.6159–1 is revised
to read as follows:
§ 301.6159–1 Agreements for payment of
tax liabilities in installments.
(a) Authority. The Commissioner may
enter into a written agreement with a
taxpayer that allows the taxpayer to
make scheduled periodic payments of
any tax liability if the Commissioner
determines that such agreement will
facilitate full or partial collection of the
tax liability.
(b) Procedures for submission and
consideration of proposed installment
agreements—(1) In general. A proposed
installment agreement must be
submitted according to the procedures,
and in the form and manner, prescribed
by the Commissioner.
(2) When a proposed installment
agreement becomes pending. A
proposed installment agreement
becomes pending when it is accepted
for processing. The Internal Revenue
Service (IRS) may not accept a proposed
installment agreement for processing
following reference of a case involving
the liability that is the subject of the
proposed installment agreement to the
Department of Justice for prosecution or
defense. The proposed installment
agreement remains pending until the
IRS accepts the proposal, the IRS
notifies the taxpayer that the proposal
has been rejected, or the proposal is
withdrawn by the taxpayer. If a
proposed installment agreement that has
been accepted for processing does not
contain sufficient information to permit
the IRS to evaluate whether the proposal
should be accepted, the IRS will request
the taxpayer to provide the needed
additional information. If the taxpayer
does not submit the additional
information that the IRS has requested
within a reasonable time period after
such a request, the IRS may reject the
proposed installment agreement.
(3) Revised proposals of installment
agreements submitted following
PO 00000
Frm 00007
Fmt 4702
Sfmt 4702
rejection. If, following the rejection of a
proposed installment agreement, the IRS
determines that the taxpayer made a
good faith revision of the proposal and
submitted the revision within 30 days of
the date of rejection, the provisions of
this section shall apply to that revised
proposal. If, however, the IRS
determines that a revision was not made
in good faith, the provisions of this
section do not apply to the revision and
the appeal period in paragraph (d)(3) of
this section continues to run from the
date of the original rejection.
(c) Acceptance, form, and terms of
installment agreements—(1) Acceptance
of an installment agreement—(i) In
general. A proposed installment
agreement has not been accepted until
the IRS notifies the taxpayer or the
taxpayer’s representative of the
acceptance. Except as provided in
paragraph (c)(1)(iii) of this section, the
Commissioner has the discretion to
accept or reject any proposed
installment agreement.
(ii) Acceptance does not reduce
liabilities. The acceptance of an
installment agreement by the IRS does
not reduce the amount of taxes, interest,
or penalties owed. (However, penalties
may continue to accrue at a reduced rate
pursuant to section 6651(h).)
(iii) Guaranteed installment
agreements. In the case of a liability of
an individual for income tax, the
Commissioner shall accept a proposed
installment agreement if, as of the date
the individual proposes the installment
agreement—
(A) The aggregate amount of the
liability (not including interest,
penalties, additions to tax, and
additional amounts) does not exceed
$10,000;
(B) The taxpayer (and, if the liability
relates to a joint return, the taxpayer’s
spouse) has not, during any of the
preceding five taxable years—
(1) Failed to file any income tax
return;
(2) Failed to pay any required income
tax; or
(3) Entered into an installment
agreement for the payment of any
income tax;
(C) The Commissioner determines
that the taxpayer is financially unable to
pay the liability in full when due (and
the taxpayer submits any information
the Commissioner requires to make that
determination);
(D) The installment agreement
requires full payment of the liability
within three years; and
(E) The taxpayer agrees to comply
with the provisions of the Internal
Revenue Code for the period the
agreement is in effect.
E:\FR\FM\05MRP1.SGM
05MRP1
erjones on PRODPC74 with PROPOSALS
Federal Register / Vol. 72, No. 42 / Monday, March 5, 2007 / Proposed Rules
(2) Form of installment agreements.
An installment agreement must be in
writing. A written installment
agreement may take the form of a
document signed by the taxpayer and
the Commissioner or a written
confirmation of an agreement entered
into by the taxpayer and the
Commissioner that is mailed or
personally delivered to the taxpayer.
(3) Terms of installment agreements.
(i) Except as otherwise provided in this
section, an installment agreement is
effective from the date the IRS notifies
the taxpayer or the taxpayer’s
representative of its acceptance until the
date the agreement ends by its terms or
until it is superceded by a new
installment agreement.
(ii) By its terms, an installment
agreement may end upon the expiration
of the period of limitations on collection
in section 6502 and § 301.6502–1, or at
some prior date.
(iii) As a condition to entering into an
installment agreement with a taxpayer,
the Commissioner may require that—
(A) The taxpayer agree to a reasonable
extension of the period of limitations on
collection; and
(B) The agreement contain terms that
protect the interests of the Government.
(iv) Except as otherwise provided in
an installment agreement, all payments
made under the installment agreement
will be applied in the best interests of
the Government.
(v) While an installment agreement is
in effect, the Commissioner may
request, and the taxpayer must provide,
a financial condition update at any time.
(vi) At any time after entering into an
installment agreement, the
Commissioner and the taxpayer may
agree to modify or terminate an
installment agreement or may agree to a
new installment agreement that
supercedes the existing agreement.
(d) Rejection of a proposed
installment agreement—(1) When a
proposed installment agreement
becomes rejected. A proposed
installment agreement has not been
rejected until the IRS notifies the
taxpayer or the taxpayer’s representative
of the rejection, the reason(s) for
rejection, and the right to an appeal.
(2) Independent administrative
review. The IRS may not notify a
taxpayer or taxpayer’s representative of
the rejection of an installment
agreement until an independent
administrative review of the proposed
rejection is completed.
(3) Appeal of rejection of a proposed
installment agreement. The taxpayer
may administratively appeal a rejection
of a proposed installment agreement to
the IRS Office of Appeals (Appeals) if,
VerDate Aug<31>2005
15:28 Mar 02, 2007
Jkt 211001
within the 30-day period commencing
the day after the taxpayer is notified of
the rejection, the taxpayer requests an
appeal in the manner provided by the
Commissioner.
(e) Modification or termination of
installment agreements by the Internal
Revenue Service—(1) Inadequate
information or jeopardy. The
Commissioner may terminate an
installment agreement if the
Commissioner determines that—
(i) Information which was provided to
the IRS by the taxpayer or the taxpayer’s
representative in connection with the
granting of the installment agreement
was inaccurate or incomplete in any
material respect; or
(ii) Collection of any liability to which
the installment agreement applies is in
jeopardy.
(2) Change in financial condition,
failure to timely pay an installment or
another Federal tax liability, or failure
to provide requested financial
information. The Commissioner may
modify or terminate an installment
agreement if—
(i) The Commissioner determines that
the financial condition of a taxpayer
that is party to the agreement has
significantly changed; or
(ii) A taxpayer that is party to the
installment agreement fails to—
(A) Timely pay an installment in
accordance with the terms of the
installment agreement;
(B) Pay any other Federal tax liability
when the liability becomes due; or
(C) Provide a financial condition
update requested by the Commissioner.
(3) Notice. Unless the Commissioner
determines that collection of the tax is
in jeopardy, the Commissioner will
notify the taxpayer in writing at least 30
days prior to modifying or terminating
an installment agreement pursuant to
paragraph (e)(1) or (2) of this section.
The notice provided pursuant to this
section must briefly describe the reason
for the intended modification or
termination. Upon receiving notice, the
taxpayer may provide information
showing that the reason for the
proposed modification or termination is
incorrect.
(4) Appeal of modification or
termination of an installment
agreement. The taxpayer may
administratively appeal the
modification or termination of an
installment agreement to Appeals if,
following issuance of the notice
required by paragraph (e)(3) of this
section and prior to the expiration of the
30-day period commencing the day after
the modification or termination is to
take effect, the taxpayer requests an
PO 00000
Frm 00008
Fmt 4702
Sfmt 4702
9715
appeal in the manner provided by the
Commissioner.
(f) Effect of installment agreement or
pending installment agreement on
collection activity—(1) In general. No
levy may be made to collect a tax
liability that is the subject of an
installment agreement during the period
that a proposed installment agreement is
pending with the IRS, for 30 days
immediately following the rejection of a
proposed installment agreement, during
the period that an installment agreement
is in effect, and for 30 days immediately
following the termination of an
installment agreement. If, prior to the
expiration of the 30-day period
following the rejection or termination of
an installment agreement, the taxpayer
appeals the rejection or termination
decision, no levy may be made while
the rejection or termination is being
considered by Appeals. This section
will not prohibit levy to collect the
liability of any person other than the
person or persons named in the
installment agreement.
(2) Exceptions. Paragraph (f)(1) of this
section shall not prohibit levy if the
taxpayer files a written notice with the
IRS that waives the restriction on levy
imposed by this section, the IRS
determines that the proposed
installment agreement was submitted
solely to delay collection, or the IRS
determines that collection of the tax to
which the installment agreement or
proposed installment agreement relates
is in jeopardy.
(3) Other actions by the IRS while levy
is prohibited—(i) In general. The IRS
may take actions other than levy to
protect the interests of the Government
with regard to the liability identified in
an installment agreement or proposed
installment agreement. Those actions
include, for example—
(A) Crediting an overpayment against
the liability pursuant to section 6402;
(B) Filing or refiling notices of Federal
tax lien; and
(C) Taking action to collect from any
person who is not named in the
installment agreement or proposed
installment agreement but who is liable
for the tax to which the installment
agreement relates.
(ii) Proceedings in court. Except as
otherwise provided in this paragraph
(f)(3)(ii), the IRS will not refer a case to
the Department of Justice for the
commencement of a proceeding in
court, against a person named in an
installment agreement or proposed
installment agreement, if levy to collect
the liability is prohibited by paragraph
(f)(1) of this section. Without regard to
whether a person is named in an
installment agreement or proposed
E:\FR\FM\05MRP1.SGM
05MRP1
erjones on PRODPC74 with PROPOSALS
9716
Federal Register / Vol. 72, No. 42 / Monday, March 5, 2007 / Proposed Rules
installment agreement, however, the IRS
may authorize the Department of Justice
to file a counterclaim or third-party
complaint in a refund action or to join
that person in any other proceeding in
which liability for the tax that is the
subject of the installment agreement or
proposed installment agreement may be
established or disputed, including a suit
against the United States under 28
U.S.C. 2410. In addition, the United
States may file a claim in any
bankruptcy proceeding or insolvency
action brought by or against such
person. If a person named in an
installment agreement is joined in a
proceeding, the United States obtains a
judgment against that person, and the
case is referred back to the IRS for
collection, collection will continue to
occur pursuant to the terms of the
installment agreement. Notwithstanding
the installment agreement, any claim or
suit permitted will be for the full
amount of the liabilities owed.
(g) Suspension of the statute of
limitations on collection. The statute of
limitations under section 6502 for
collection of any liability shall be
suspended during the period that a
proposed installment agreement relating
to that liability is pending with the IRS,
for 30 days immediately following the
rejection of a proposed installment
agreement, and for 30 days immediately
following the termination of an
installment agreement. If, within the 30
days following the rejection or
termination of an installment
agreement, the taxpayer files an appeal
with Appeals, the statute of limitations
for collection shall be suspended while
the rejection or termination is being
considered by Appeals. The statute of
limitations for collection shall continue
to run if an exception under paragraph
(f)(2) of this section applies and levy is
not prohibited with respect to the
taxpayer.
(h) Annual statement. The
Commissioner shall provide each
taxpayer who is party to an installment
agreement under this section with an
annual statement setting forth the initial
balance owed at the beginning of the
year, the payments made during the
year, and the remaining balance as of
the end of the year.
(i) Biannual review of partial payment
installment agreements. The
Commissioner shall perform a review of
the taxpayer’s financial condition in the
case of a partial payment installment
agreement at least once every two years.
The purpose of this review is to
determine whether the taxpayer’s
financial condition has significantly
changed so as to warrant an increase in
VerDate Aug<31>2005
15:28 Mar 02, 2007
Jkt 211001
the value of the payments being made
or termination of the agreement.
(j) Cross reference. Pursuant to section
6601(b)(1), the last day prescribed for
payment is determined without regard
to any installment agreement, including
for purposes of computing penalties and
interest provided by the Internal
Revenue Code. For special rules
regarding the computation of the failure
to pay penalty while certain installment
agreements are in effect, see section
6651(h) and § 301.6651–1(a)(4).
(k) Effective date. This section is
applicable on the date final regulations
are published in the Federal Register.
Par. 4. Section 301.6331–4 is revised
to read as follows:
§ 301.6331–4 Restrictions on levy while
installment agreements are pending or in
effect.
Cross-reference. For provisions
relating to the making of levies while an
installment agreement is pending or in
effect, see § 301.6159–1.
Mark E. Matthews,
Deputy Commissioner of Services and
Enforcement.
[FR Doc. E7–3730 Filed 3–2–07; 8:45 am]
BILLING CODE 4830–01–P
DEPARTMENT OF LABOR
Occupational Safety and Health
Administration
29 CFR Part 1910
[Docket No. OSHA–2007–0021]
RIN 1218–AC16
Announcement of Stakeholder
Meetings on Occupational Exposure to
Ionizing Radiation
Occupational Safety and Health
Administration, Labor.
ACTION: Announcement of stakeholder
meetings.
AGENCY:
SUMMARY: The Occupational Safety and
Health Administration (OSHA) invites
interested parties to participate in
informal stakeholder meetings on
Occupational Exposure to Ionizing
Radiation. These meetings are a
continuation of OSHA’s information
collection efforts on ionizing radiation.
DATES: Stakeholder meetings: The
stakeholder meeting dates are:
1. 8:30 a.m.–4:30 p.m., March 16,
2007, Washington, DC.
2. 8:30 a.m.–4:30 p.m., March 26,
2007, Orlando, FL.
Notice of intention to attend a
stakeholder meeting: You must submit a
notice of intention to attend the
PO 00000
Frm 00009
Fmt 4702
Sfmt 4702
Washington, DC, or Orlando, FL,
stakeholder meeting by March 9, 2007.
ADDRESSES: Stakeholder meetings: The
stakeholder meeting locations are:
1. Frances Perkins Building, U.S.
Department of Labor, 200 Constitution
Avenue, NW., Washington, DC 20210.
2. For the location of the Orlando, FL,
stakeholder meeting, contact Liset
Navas at (202) 693–1950.
Notices of intention to attend a
stakeholder meeting: You may submit
your notice of intention to attend a
stakeholder meeting by any of the
following methods:
Electronic: OSHA encourages you to
submit your notice of intention to attend
to navas.liset@dol.gov.
Facsimile: You may fax your notice of
intention to attend to (202) 693–1678.
Regular mail, express delivery, hand
delivery, messenger and courier service:
Submit your notice of intention to
attend to Liset Navas, OSHA,
Directorate of Standards and Guidance,
Room N–3718, U.S. Department of
Labor, 200 Constitution Avenue, NW.,
Washington, DC 20210; telephone (202)
693–1950. The Department of Labor’s
and OSHA’s normal hours of operation
are 8:15 a.m. to 4:45 p.m., e.t.
Instructions: For further information
on the stakeholder meetings and
submitting notices of intention to attend
one of the meetings, see the ‘‘Public
Participation’’ heading in the
SUPPLEMENTARY INFORMATION section of
this notice.
Because of security-related
procedures, the use of regular mail may
cause a significant delay in the receipt
of notices of intention to attend. For
information about security procedures
concerning the delivery of materials by
hand, express mail, messenger or
courier service, please contact Liset
Navas at (202) 693–1950.
Electronic copies of this Federal
Register notice are available at https://
www.regulations.gov. This document,
non-attributed notes from the
stakeholder meetings, as well as news
releases and other relevant information,
will also be available at OSHA’s Web
page at https://www.osha.gov.
FOR FURTHER INFORMATION CONTACT:
Michael Seymour, Director, OSHA,
Office of Physical Hazards, Directorate
of Standards and Guidance, Room N–
3718, U.S. Department of Labor, 200
Constitution Avenue, NW., Washington,
DC 20210; telephone (202) 693–1950.
SUPPLEMENTARY INFORMATION:
Background
The use of ionizing radiation has
increased significantly in recent years.
Today, ionizing radiation is used in a
E:\FR\FM\05MRP1.SGM
05MRP1
]]>Agencies
[Federal Register Volume 72, Number 42 (Monday, March 5, 2007)]
[Proposed Rules]
[Pages 9712-9716]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-3730]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 301
[REG-100841-97]
RIN 1545-AU97
Agreements for Payment of Tax Liabilities in Installments
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Withdrawal of notice of proposed rulemaking and notice of
proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: This document withdraws the notice of proposed rulemaking
published in the Federal Register on December 31, 1997 (62 FR 68241)
and contains proposed regulations relating to the payment of tax
liabilities in installments. The proposed regulations reflect changes
to the law made by the Taxpayer Bill of Rights II, the Internal Revenue
Service Restructuring and Reform Act of 1998, and the American Jobs
Creation Act of 2004.
DATES: Written or electronic comments and requests for a public hearing
must be received by June 4, 2007.
ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-100841-97), room
5203, Internal Revenue Service, POB 7604, Ben Franklin Station,
Washington, DC 20044. Submissions may be hand delivered Monday through
Friday between the hours of 8 a.m. and 4 p.m. to: CC:PA:LPD:PR (REG-
100841-97), Courier's Desk, Internal Revenue Service, 1111 Constitution
Avenue, NW., Washington, DC. Alternatively, taxpayers may submit
comments electronically directly to the IRS Internet site at https://
www.irs.gov/regs or via the Federal eRulemaking Portal at https://
www.regulations.gov (indicate IRS and REG-100841-97).
FOR FURTHER INFORMATION CONTACT: Concerning the regulations, G. William
Beard, (202) 622-3620; concerning submissions of comments or requests
for a hearing, Kelly Banks, (202) 622-7180 (not toll-free numbers).
SUPPLEMENTARY INFORMATION:
Background
On December 31, 1997, a notice of proposed rulemaking (REG-100841-
97; 62 FR 68241) reflecting changes made to section 6159 of the
Internal Revenue Code (Code) by section 202 of the Taxpayer Bill of
Rights II, Pub. L. 104-168 (110 Stat. 1452, 1457) was published in the
Federal Register. That proposed rule was not acted upon prior to the
enactment of the Internal Revenue Service Restructuring and Reform Act
of 1998 (RRA 1998), Pub. L. 105-206, section 3462 (112 Stat. 685, 764),
which made further amendments to section 6159. Section 843 of the
American Jobs Creation Act of 2004 (AJCA), Pub. L. 108-357 (118 Stat.
1418, 1600), also made changes to section 6159. This document amends
the prior notice of proposed rulemaking. It contains proposed
amendments to the Procedure and Administration Regulations (26 CFR part
301) under section 6159 reflecting
[[Page 9713]]
the amendment of the Code by RRA 1998, the Taxpayer Bill of Rights II,
and the AJCA.
Installment Agreements Under Section 6159
Consistent with its mission of applying the tax laws with integrity
and fairness to all, the IRS generally expects that all taxpayers will
pay the total amount due, regardless of amount, at the time the Code
requires that the tax be paid. See Policy Statement P-5-2, Collecting
Principles (Approved February 17, 2000), reprinted at IRM 1.2.1.5.2.
When attempting to resolve a tax delinquency, the IRS will work with
taxpayers to achieve full payment of all tax, penalties, and interest.
Where payment in full cannot immediately be achieved, the IRS may allow
taxpayers to pay over time through installment agreements.
Explanation of Provisions
The proposed regulations allow the IRS to enter into agreements for
the full or partial payment of any unpaid tax in installments. The
regulations provide rules for the submission of proposed installment
agreements, the processing, acceptance, and rejection of such
agreements by the IRS, the termination or modification of existing
agreements, and the appeal of rejections, modifications, and
terminations to the IRS Office of Appeals (Appeals). The majority of
these provisions are unchanged from what was contained in the prior
regulations or reflect longstanding IRS administrative practice. The
rules regarding when a proposed installment agreement becomes pending,
restrictions on collection activity while an agreement is pending or in
effect, and the suspension of the statute of limitations for collection
are nearly identical to the provisions in existing Sec. 301.6331-4.
The only change was a clarification that the IRS will not be precluded
from filing suit or a proof of claim in bankruptcy for the full amount
of the liabilities owed, regardless of whether the installment
agreement provides for full or partial payment of the liabilities at
issue.
Taxpayers may request administrative review of IRS decisions to
modify or terminate installment agreements pursuant to section 6159(e),
added to the Code by section 202 of the Taxpayer Bill of Rights II.
Taxpayers may appeal rejections of proposed installment agreements
under section 7122(d), added to the Code by section 3462 of RRA 1998.
The proposed regulations allow taxpayers to appeal a termination,
modification, or rejection of an installment agreement to Appeals
provided they request the appeal in the manner specified by the IRS.
The previous notice of proposed rulemaking contained a more
detailed procedure for seeking review of decisions to terminate or
modify agreements. That proposed regulation has not been adopted. These
regulations contain a less detailed procedure because procedures for
appealing differ depending on the IRS operating division handling the
case, the size of the tax liability, or the type of tax at issue. For
example, some taxpayers may be able to request an appeal by telephone
while others will be required to submit a formal written request. See
Publication 1660, Collection Appeal Rights.
The proposed regulations incorporate the provisions of section
6159(c), added to the Code by section 3467 of RRA 1998. That section
requires the IRS to accept a proposed installment agreement for income
taxes under certain circumstances. The regulations also incorporate
section 3506 of RRA 1998, which requires the IRS to send each taxpayer
with an installment agreement an annual statement showing the balance
due at the beginning of the year, the payments made during the year,
and the remaining balance due at the end of the year.
Section 843 of the AJCA amended section 6159(a) to allow the IRS to
enter into installment agreements that provide for partial (as well as
full) payment of a tax liability. The proposed regulations incorporate
this change. Because a partial payment installment agreement could be
confused with a compromise of the liability, the proposed regulations
clarify that an installment agreement does not reduce the amount of
taxes, interest, or penalties owed. See H. Rep. No. 108-755, 108th
Cong., 2d Sess., 2005 U.S.C.C.A.N. 1341 (October 7, 2004).
The proposed regulations also clarify that the IRS may enter into
an installment agreement that, by its terms, ends upon the expiration
of the period of limitations on collection in section 6502 and Sec.
301.6502-1, or at some prior date. A partial payment installment
agreement that ends prior to the expiration of the collection period of
limitations would allow the IRS to collect the balance of the tax
liability against any property belonging to the taxpayer or request the
Department of Justice to institute a judicial action to reduce the
liability to judgment or take other actions to enforce the federal tax
lien. The proposed regulations do not limit the authority of the IRS to
enter into partial payment installment agreements that run to the end
of the collection period.
Section 843 of the AJCA amended section 6159(c) to exclude partial
payment installment agreements from the scope of installment agreements
that must be accepted by the IRS. The proposed regulations provide that
installment agreements guaranteed under section 6159(c) must provide
for the full payment of the liabilities.
Section 843 of the AJCA added new section 6159(d), requiring the
IRS to review partial payment installment agreements every two years.
(Former subsections (d) and (e) were redesignated (e) and (f).) The
primary purpose of the review is to determine whether the financial
condition of the taxpayer has significantly changed so as to warrant an
increase in the value of the payments being made. See H. Rep. No. 108-
755, 108th Cong., 2d Sess., 2005 U.S.C.C.A.N. 1341 (October 7, 2004).
The proposed regulations reflect this requirement.
The proposed regulations clarify the application of payments made
pursuant to installment agreements. Consistent with Revenue Procedure
2002-26 (2002-1 C.B. 746), all payments will be applied in the best
interests of the Government, unless the installment agreement provides
otherwise. Current regulations provide rules for when the IRS may
terminate an agreement but do not expressly provide that a taxpayer and
the IRS may agree to end an agreement. The proposed regulations clarify
that an installment agreement may be terminated by agreement between
the taxpayer and the IRS, or may be superceded by a new agreement.
Proposed Effective Date
These regulations are proposed to be effective upon publication in
the Federal Register of the final regulations.
Special Analyses
It has been determined that this notice of proposed rulemaking is
not a significant regulatory action as defined in Executive Order
12866. Therefore, a regulatory assessment is not required. It also has
been determined that section 553(b) of the Administrative Procedure Act
(5 U.S.C. chapter 5) does not apply to these regulations and, because
these regulations do not impose a collection of information under the
Paperwork Reduction Act (44 U.S.C. 3501), the Regulatory Flexibility
Act (5 U.S.C. chapter 6) does not apply to these regulations. Pursuant
to section 7805(f) of the Code, this notice of proposed rulemaking will
be submitted to the Chief Counsel for Advocacy of the Small
[[Page 9714]]
Business Administration for comment on its impact on small business.
Comments and Requests for a Public Hearing
Before these proposed regulations are adopted as final regulations,
consideration will be given to any written comments (a signed original
and eight (8) copies) or electronic comments that are submitted timely
to the IRS. The IRS generally requests any comments on the clarity of
the proposed rule and how it may be made easier to understand. All
comments will be available for public inspection and copying. A public
hearing may be scheduled if requested in writing by a person that
timely submits written or electronic comments. If a public hearing is
scheduled, notice of the date, time, and place for the hearing will be
published in the Federal Register.
Drafting Information
The principal author of these regulations is G. William Beard,
Office of Associate Chief Counsel (Procedure and Administration),
Collection, Bankruptcy & Summonses Division.
List of Subjects in 26 CFR Part 301
Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income
taxes, Penalties, Reporting and recordkeeping requirements.
Withdrawal of Proposed Regulations
Accordingly, under the authority of 26 U.S.C. 7805, the notice of
proposed rulemaking (REG-100841-97) that was published in theFederal
Register on December 31, 1997 (62 FR 68241) is withdrawn.
Proposed Amendments to the Regulations
Accordingly, 26 CFR part 301 is proposed to be amended as follows:
PART 301--PROCEDURE AND ADMINISTRATION
Paragraph 1. The authority citation for part 301 continues to read
in part as follows:
Authority: 26 U.S.C. 7805 * * *
Par. 2. Section 301.6159-0 is added to read as follows:
Sec. 301.6159-0 Table of contents.
This section lists the major captions that appear in the
regulations under Sec. 301.6159-1.
Sec. 301.6159-1 Agreements for the payment of tax liabilities in
installments.
(a) Authority.
(b) Procedures for submission and consideration of proposed
installment agreements.
(c) Acceptance, form, and terms of installment agreements.
(d) Rejection of a proposed installment agreement.
(e) Modification or termination of installment agreements by the
Internal Revenue Service.
(f) Effect of installment agreement or pending installment agreement
on collection activity.
(g) Suspension of the statute of limitations on collection.
(h) Annual statement.
(i) Biannual review of partial payment installment agreements.
(j) Cross reference.
(k) Effective date.
Par. 3. Section 301.6159-1 is revised to read as follows:
Sec. 301.6159-1 Agreements for payment of tax liabilities in
installments.
(a) Authority. The Commissioner may enter into a written agreement
with a taxpayer that allows the taxpayer to make scheduled periodic
payments of any tax liability if the Commissioner determines that such
agreement will facilitate full or partial collection of the tax
liability.
(b) Procedures for submission and consideration of proposed
installment agreements--(1) In general. A proposed installment
agreement must be submitted according to the procedures, and in the
form and manner, prescribed by the Commissioner.
(2) When a proposed installment agreement becomes pending. A
proposed installment agreement becomes pending when it is accepted for
processing. The Internal Revenue Service (IRS) may not accept a
proposed installment agreement for processing following reference of a
case involving the liability that is the subject of the proposed
installment agreement to the Department of Justice for prosecution or
defense. The proposed installment agreement remains pending until the
IRS accepts the proposal, the IRS notifies the taxpayer that the
proposal has been rejected, or the proposal is withdrawn by the
taxpayer. If a proposed installment agreement that has been accepted
for processing does not contain sufficient information to permit the
IRS to evaluate whether the proposal should be accepted, the IRS will
request the taxpayer to provide the needed additional information. If
the taxpayer does not submit the additional information that the IRS
has requested within a reasonable time period after such a request, the
IRS may reject the proposed installment agreement.
(3) Revised proposals of installment agreements submitted following
rejection. If, following the rejection of a proposed installment
agreement, the IRS determines that the taxpayer made a good faith
revision of the proposal and submitted the revision within 30 days of
the date of rejection, the provisions of this section shall apply to
that revised proposal. If, however, the IRS determines that a revision
was not made in good faith, the provisions of this section do not apply
to the revision and the appeal period in paragraph (d)(3) of this
section continues to run from the date of the original rejection.
(c) Acceptance, form, and terms of installment agreements--(1)
Acceptance of an installment agreement--(i) In general. A proposed
installment agreement has not been accepted until the IRS notifies the
taxpayer or the taxpayer's representative of the acceptance. Except as
provided in paragraph (c)(1)(iii) of this section, the Commissioner has
the discretion to accept or reject any proposed installment agreement.
(ii) Acceptance does not reduce liabilities. The acceptance of an
installment agreement by the IRS does not reduce the amount of taxes,
interest, or penalties owed. (However, penalties may continue to accrue
at a reduced rate pursuant to section 6651(h).)
(iii) Guaranteed installment agreements. In the case of a liability
of an individual for income tax, the Commissioner shall accept a
proposed installment agreement if, as of the date the individual
proposes the installment agreement--
(A) The aggregate amount of the liability (not including interest,
penalties, additions to tax, and additional amounts) does not exceed
$10,000;
(B) The taxpayer (and, if the liability relates to a joint return,
the taxpayer's spouse) has not, during any of the preceding five
taxable years--
(1) Failed to file any income tax return;
(2) Failed to pay any required income tax; or
(3) Entered into an installment agreement for the payment of any
income tax;
(C) The Commissioner determines that the taxpayer is financially
unable to pay the liability in full when due (and the taxpayer submits
any information the Commissioner requires to make that determination);
(D) The installment agreement requires full payment of the
liability within three years; and
(E) The taxpayer agrees to comply with the provisions of the
Internal Revenue Code for the period the agreement is in effect.
[[Page 9715]]
(2) Form of installment agreements. An installment agreement must
be in writing. A written installment agreement may take the form of a
document signed by the taxpayer and the Commissioner or a written
confirmation of an agreement entered into by the taxpayer and the
Commissioner that is mailed or personally delivered to the taxpayer.
(3) Terms of installment agreements. (i) Except as otherwise
provided in this section, an installment agreement is effective from
the date the IRS notifies the taxpayer or the taxpayer's representative
of its acceptance until the date the agreement ends by its terms or
until it is superceded by a new installment agreement.
(ii) By its terms, an installment agreement may end upon the
expiration of the period of limitations on collection in section 6502
and Sec. 301.6502-1, or at some prior date.
(iii) As a condition to entering into an installment agreement with
a taxpayer, the Commissioner may require that--
(A) The taxpayer agree to a reasonable extension of the period of
limitations on collection; and
(B) The agreement contain terms that protect the interests of the
Government.
(iv) Except as otherwise provided in an installment agreement, all
payments made under the installment agreement will be applied in the
best interests of the Government.
(v) While an installment agreement is in effect, the Commissioner
may request, and the taxpayer must provide, a financial condition
update at any time.
(vi) At any time after entering into an installment agreement, the
Commissioner and the taxpayer may agree to modify or terminate an
installment agreement or may agree to a new installment agreement that
supercedes the existing agreement.
(d) Rejection of a proposed installment agreement--(1) When a
proposed installment agreement becomes rejected. A proposed installment
agreement has not been rejected until the IRS notifies the taxpayer or
the taxpayer's representative of the rejection, the reason(s) for
rejection, and the right to an appeal.
(2) Independent administrative review. The IRS may not notify a
taxpayer or taxpayer's representative of the rejection of an
installment agreement until an independent administrative review of the
proposed rejection is completed.
(3) Appeal of rejection of a proposed installment agreement. The
taxpayer may administratively appeal a rejection of a proposed
installment agreement to the IRS Office of Appeals (Appeals) if, within
the 30-day period commencing the day after the taxpayer is notified of
the rejection, the taxpayer requests an appeal in the manner provided
by the Commissioner.
(e) Modification or termination of installment agreements by the
Internal Revenue Service--(1) Inadequate information or jeopardy. The
Commissioner may terminate an installment agreement if the Commissioner
determines that--
(i) Information which was provided to the IRS by the taxpayer or
the taxpayer's representative in connection with the granting of the
installment agreement was inaccurate or incomplete in any material
respect; or
(ii) Collection of any liability to which the installment agreement
applies is in jeopardy.
(2) Change in financial condition, failure to timely pay an
installment or another Federal tax liability, or failure to provide
requested financial information. The Commissioner may modify or
terminate an installment agreement if--
(i) The Commissioner determines that the financial condition of a
taxpayer that is party to the agreement has significantly changed; or
(ii) A taxpayer that is party to the installment agreement fails
to--
(A) Timely pay an installment in accordance with the terms of the
installment agreement;
(B) Pay any other Federal tax liability when the liability becomes
due; or
(C) Provide a financial condition update requested by the
Commissioner.
(3) Notice. Unless the Commissioner determines that collection of
the tax is in jeopardy, the Commissioner will notify the taxpayer in
writing at least 30 days prior to modifying or terminating an
installment agreement pursuant to paragraph (e)(1) or (2) of this
section. The notice provided pursuant to this section must briefly
describe the reason for the intended modification or termination. Upon
receiving notice, the taxpayer may provide information showing that the
reason for the proposed modification or termination is incorrect.
(4) Appeal of modification or termination of an installment
agreement. The taxpayer may administratively appeal the modification or
termination of an installment agreement to Appeals if, following
issuance of the notice required by paragraph (e)(3) of this section and
prior to the expiration of the 30-day period commencing the day after
the modification or termination is to take effect, the taxpayer
requests an appeal in the manner provided by the Commissioner.
(f) Effect of installment agreement or pending installment
agreement on collection activity--(1) In general. No levy may be made
to collect a tax liability that is the subject of an installment
agreement during the period that a proposed installment agreement is
pending with the IRS, for 30 days immediately following the rejection
of a proposed installment agreement, during the period that an
installment agreement is in effect, and for 30 days immediately
following the termination of an installment agreement. If, prior to the
expiration of the 30-day period following the rejection or termination
of an installment agreement, the taxpayer appeals the rejection or
termination decision, no levy may be made while the rejection or
termination is being considered by Appeals. This section will not
prohibit levy to collect the liability of any person other than the
person or persons named in the installment agreement.
(2) Exceptions. Paragraph (f)(1) of this section shall not prohibit
levy if the taxpayer files a written notice with the IRS that waives
the restriction on levy imposed by this section, the IRS determines
that the proposed installment agreement was submitted solely to delay
collection, or the IRS determines that collection of the tax to which
the installment agreement or proposed installment agreement relates is
in jeopardy.
(3) Other actions by the IRS while levy is prohibited--(i) In
general. The IRS may take actions other than levy to protect the
interests of the Government with regard to the liability identified in
an installment agreement or proposed installment agreement. Those
actions include, for example--
(A) Crediting an overpayment against the liability pursuant to
section 6402;
(B) Filing or refiling notices of Federal tax lien; and
(C) Taking action to collect from any person who is not named in
the installment agreement or proposed installment agreement but who is
liable for the tax to which the installment agreement relates.
(ii) Proceedings in court. Except as otherwise provided in this
paragraph (f)(3)(ii), the IRS will not refer a case to the Department
of Justice for the commencement of a proceeding in court, against a
person named in an installment agreement or proposed installment
agreement, if levy to collect the liability is prohibited by paragraph
(f)(1) of this section. Without regard to whether a person is named in
an installment agreement or proposed
[[Page 9716]]
installment agreement, however, the IRS may authorize the Department of
Justice to file a counterclaim or third-party complaint in a refund
action or to join that person in any other proceeding in which
liability for the tax that is the subject of the installment agreement
or proposed installment agreement may be established or disputed,
including a suit against the United States under 28 U.S.C. 2410. In
addition, the United States may file a claim in any bankruptcy
proceeding or insolvency action brought by or against such person. If a
person named in an installment agreement is joined in a proceeding, the
United States obtains a judgment against that person, and the case is
referred back to the IRS for collection, collection will continue to
occur pursuant to the terms of the installment agreement.
Notwithstanding the installment agreement, any claim or suit permitted
will be for the full amount of the liabilities owed.
(g) Suspension of the statute of limitations on collection. The
statute of limitations under section 6502 for collection of any
liability shall be suspended during the period that a proposed
installment agreement relating to that liability is pending with the
IRS, for 30 days immediately following the rejection of a proposed
installment agreement, and for 30 days immediately following the
termination of an installment agreement. If, within the 30 days
following the rejection or termination of an installment agreement, the
taxpayer files an appeal with Appeals, the statute of limitations for
collection shall be suspended while the rejection or termination is
being considered by Appeals. The statute of limitations for collection
shall continue to run if an exception under paragraph (f)(2) of this
section applies and levy is not prohibited with respect to the
taxpayer.
(h) Annual statement. The Commissioner shall provide each taxpayer
who is party to an installment agreement under this section with an
annual statement setting forth the initial balance owed at the
beginning of the year, the payments made during the year, and the
remaining balance as of the end of the year.
(i) Biannual review of partial payment installment agreements. The
Commissioner shall perform a review of the taxpayer's financial
condition in the case of a partial payment installment agreement at
least once every two years. The purpose of this review is to determine
whether the taxpayer's financial condition has significantly changed so
as to warrant an increase in the value of the payments being made or
termination of the agreement.
(j) Cross reference. Pursuant to section 6601(b)(1), the last day
prescribed for payment is determined without regard to any installment
agreement, including for purposes of computing penalties and interest
provided by the Internal Revenue Code. For special rules regarding the
computation of the failure to pay penalty while certain installment
agreements are in effect, see section 6651(h) and Sec. 301.6651-
1(a)(4).
(k) Effective date. This section is applicable on the date final
regulations are published in the Federal Register.
Par. 4. Section 301.6331-4 is revised to read as follows:
Sec. 301.6331-4 Restrictions on levy while installment agreements are
pending or in effect.
Cross-reference. For provisions relating to the making of levies
while an installment agreement is pending or in effect, see Sec.
301.6159-1.
Mark E. Matthews,
Deputy Commissioner of Services and Enforcement.
[FR Doc. E7-3730 Filed 3-2-07; 8:45 am]
BILLING CODE 4830-01-P
