This IRM describes the installment agreement process. Specifically, IRM 5.14.13:

Purpose - This section provides procedures for approval and monitoring of installment agreements, including the level of approval authority necessary for different types of agreements.

Audience - These procedures and guidance apply to IRS Field Collection revenue officers and group managers.

Policy Owner- Director, Collection Policy, is the policy owner of this IRM.

Program Owner- Collection Policy, Case Resolution Alternatives, is the program owner of this IRM.

Primary Stakeholders- The primary stakeholders affected or impacted by this IRM are:

Program Goals- Installment Agreements can be a viable case resolution for many delinquent accounts. By following the direction in this IRM section, employees can ensure installment agreements are approved when required and processed correctly.

Group managers must approve most installment agreements. Specifically, installment agreements must be approved by managers when:

Group managers have the authority to approve all installment agreements, including partial payment installment agreements secured in connection with CSED extensions. There is no dollar limit set for group manager approval of installment agreements. See IRM 5.14.1.4.3, Notice of Federal Tax Lien and Installment Agreements, regarding no dollar limits and IRM 5.14.2.3 , Collection Statute Expiration Date (CSED): Law, Policy and Procedures, on processing requirements with waivers.

Submit installment agreements to managers for review and approval after all necessary case actions are taken, including thorough documentation of completed investigations and financial analysis. See IRM 5.14.1.4, Installment Agreement Acceptance and Rejection Determinations for further clarity. Case histories must be noted that installment agreements are pending and TC 971 AC 043 was input, unless the agreement will be immediately approved (i.e., a streamlined, simple payment plan or IBTF-Express IA). See IRM 5.14.1.3, Identifying Pending, Approved and Rejected Installment Agreement Proposals on IDRS for further clarity. Inform taxpayers if approval of agreements is delayed. If managers do not approve installment agreements. See IRM 5.14.9 Independent Review and Appeals regarding Independent Administrative Review.

After investigation, analysis and necessary actions, immediately request managerial approval of installment agreements (or input of installment agreements for those cases that do not require managerial approval). Voluntary payments can be accepted during the approval process.

When installment agreements are approved by Collection Field Function on taxpayers assigned to ACS, the ACS call-site should be contacted immediately and informed of the agreement. This requirement is in addition to the requirement to input TC 971 AC 043 and/or TC 971 AC 063.

Managers must approve all revisions or adjustments to current installment agreements unless the conditions of IRM 5.14.11.5, Considerations after Default or Termination, Including Reinstatement, are met.

If an existing installment agreement is modified, Collection Field Function employees will prepare Form 4844, Request for Terminal Action, for IDRS input and attach it to the new Form 433-D, Installment Agreement, or Form 2159 , Payroll Deduction Agreement, and the CIS. If the only change is the due date, complete Form 4844, and submit it for approval and IDRS input.

The Integrated Data Retrieval System (IDRS) is used to monitor most installment agreements for timely payments on accounts, as well as to determine whether taxpayers remain in compliance with current filing and paying requirements. IDRS also monitors agreements based on the locator numbers recorded at the time agreements are input. See, Exhibit IRM 5.14.1–2 Installment Agreement Locator Numbers — (ALNs)

Follow ICS on-screen and help screen instructions to ensure installment agreements are routed properly for IDRS monitoring.

Use IDRS to monitor installment agreements for IMF, out-of-business BMF, or in-business BMF modules in either notice or balance due status meeting these criteria:

Agreements should schedule the first payments to be at least 30 days after the date agreements are input (non-DDIAs). For DDIAs, the first payment must fall between five and eight weeks into the future, regardless of the selected payment due date of the month. The expectation is that the DDIA should be input to Status 60 within 30-45 days. See IRM 5.14.10, Payroll Deduction Agreements and Direct Debit Installment Agreements.

If a payment is received in the area office on an IDRS-monitored installment agreement, use designated payment code (DPC) "99" on the posting document. Refer to Document 6209, IRS Processing Codes and Information, for information on the use of Designated Payment Codes.

Accounts are considered routine installment agreements when the type of taxpayer does not meet the criteria for any other type of IA (Guaranteed, Streamlined, Simple Payment Plan, Direct Debit, Manually Monitored Installment Agreement (MMIA), In-Business Trust Fund (IBTF) or IBTF-Express). In order to close BMF accounts as routine, all employment tax filing requirements must be closed.

The preferred method of closing a Routine IA is by choosing Option A on the ICS Installment Agreement menu. Choosing this method of closure allows the IA to be systemically uploaded from ICS to IDRS (Status 60).

After the group manager approves the IA, an ICS Print Manager Dialogue box provides the option of e-mail or immediate printing of the Form 433-D , Installment Agreement, and Letter 2850, ICS Installment Agreement Confirmation Letter. A systemic ICS history is created stating the IA was systemically uploaded to IDRS.

Generation of the acceptance letter and Form 3210, Document Transmittal, have not changed with the systemic upload process. You are still responsible for mailing Letter 2850, ICS Installment Agreement Confirmation Letter, to the taxpayer and power of attorney, if applicable.

Write "FILE COPY" in RED ink along the top of the Form 433-D, Installment Agreement, and place it in the closed case file. Send the closed case file to CCP on the Form 795-B, Closure/Document Transmittal, or a manually created Form 3210 to:

If a hard copy of the Form 433-D, Installment Agreement, was prepared and approved outside of ICS, select Option B under the Installment Agreement menu to close the case on ICS. Use the systemically generated Form 3210, Document Transmittal, to route the agreement form Form 433-D, Installment Agreement) on top of the case file to CCP for input into IDRS at Mail Stop 5-E04.114.

Option B does not systemically generate an approval notification, Form 433-D, Installment Agreement, or the Letter 2850, ICS Installment Agreement Confirmation Letter. Create the Letter 2850, ICS Installment Agreement Confirmation Letter, from the Installment Agreement menu under the Templates Listing on ICS. Field Collection employees are still responsible for mailing the Letter 2850 to the taxpayer and power of attorney, if applicable.

Certain assessments and agreements are not compatible with IDRS monitoring. The types of agreements listed below must be manually monitored in Centralized Case Processing to ensure compliance with the terms of agreements:

Status 60 is not input on manually monitored installment agreements. The modules will remain open on ICS and will be transferred to Centralized Case Processing for monitoring.

Select "MMIA — Centralized Case Processing" in either Option A or Option B on the ICS Installment Agreement menu. The preferable option is Option A. See IRM 5.14.7.4, In-Business Trust Fund Installment Agreements Requiring Financial Analysis and Determining Ability to Pay for IBTF Cases.)

ICS Installment Agreement Option A is used when neither Form 433-D, Installment Agreement, has been prepared nor approved prior to submission of the agreement for approval on ICS. Approval by the group manager using ICS Installment Agreement Option A generates:

ICS Installment Agreement Option B should be used if a hard copy Form 433-D , Installment Agreement, was prepared and approved outside of ICS. Option B does not generate the systemic information discussed in IRM 5.14.9.5(4)(b),(c) &(d). Use of Option B requires that the contact employee complete the following actions after managerial approval:

Use Exhibit IRM 5.14.1–2 Installment Agreement Locator Numbers — (ALNs)to choose the appropriate Agreement Locator Number (ALN). ICS will automatically set the subcode to "901" and the location to "MMIA" .

Advise taxpayers that the Letter 3856, Monthly Reminder for Installment Agreement Payments, which includes a payment stub and envelope, will be mailed to them.

When posting payments to manually monitored installment payments, use DPC "10" on posting documents. This code is designed to allow accumulation of data on these non-IDRS monitored agreements. See Document 6209 for information regarding other designated payment code indicators.

Refer to IRM 5.4.11, CCP Installment Agreements, for CCP's monitoring procedures on MMIAs.

See IRM 5.4.11.7, Taxpayer Inquiries to Default Notices or Proposals to Change Installment Agreements for procedures on defaulted and terminated manually monitored installment agreements.

If an installment agreement is granted while processing a courtesy investigation (OI) and transfer of the balance due account is accepted, process the installment agreement (Form 433-D, Installment Agreement or Form 2159 , Payroll Deduction Agreement) per the instructions found in the applicable IRM 5.14 section based on the type of IA secured.

If transfer is not accepted, ensure the pending installment agreement indicator (TC 971 AC 043) is input to IDRS. Return the installment agreement form Form 433-D, Installment Agreement or Form 2159, Payroll Deduction Agreement) to the initiator of the courtesy investigation for approval and processing.

31 United States Code 9701 – as implemented by Office of Management and Budget Circular A-25, section 6 – provides authority for the imposition of user fees. User fees are imposed for services pertaining to the establishment and monitoring of an installment agreement and the restructuring or reinstating of an installment agreement. See 26 CFR 300.1 and 300.2.

The purpose of installment agreement user fees is to recoup the cost of administering the installment agreement program.

On February 9, 2018, the president signed into law the Bipartisan Budget Act of 2018. The Act amended IRC 6159 to provide certain limitations to installment agreement user fees. The Act’s amendments to IRC 6159 apply to installment agreements entered on or after April 10, 2018.

A taxpayer meeting the established low-income criteria is identified systemically and the account systemically adjusts.

The taxpayer can also file a Form 13844, Application for Reduced User Fee for Installment Agreements:

Completed Form 13844, Application for Reduced User Fee for Installment Agreements, should be sent to:

If the taxpayer does not fall within low-income guidelines, deny their request and explain why he/she does not qualify. Send Letter 4213-C, Reduced Installment Agreement User Fee Rejected, and document AMS with the reason for rejection. Updated low-income guidelines can be found at: poverty guidelines. Action 61 Guidelines concerning control & monitoring apply to these requests and require comments be added to AMS.

For agreements monitored in status 60, Masterfile generates:

User fee modules must be established on manually monitored installment agreements whenthey are received in Centralized Case Processing.

Request establishment of user fee modules from Centralized Case Processing for ATAT agreements that are monitored in groups.

The purpose of an IA User Fee is for the IRS to recover costs of the services with administering the IA program to taxpayers. United States Code 9701 – as interpreted by Office of Management and Budget Circular A-25 – provides authority for the imposition of user fees. User fees are imposed for services pertaining to the entering into and monitoring of an IA and the restructuring or reinstating of an IA. See 26 CFR. 300.1. Current User Fee Rates: