Payment Plan - Payroll Taxes

  • Thread starter Stuart A. Bronstein
  • Start date

S

Stuart A. Bronstein

A small corporation has been remiss in paying its payroll taxes - I
guess they were skating on the edge financially. Now they owe a heck
of a lot.

The IRS auditor, properly, is saying she wants to hold the
corporation officers personally liable. The problem is that she is
refusing to allow a payment plan. The taxpayers figure they can
afford to pay the taxes, interest and penalties, but only if they are
allowed to pay over time.

Is there anything you can think of to help convince the auditor to
allow a payment plan?

Thanks.
 
P

paultry

A small corporation has been remiss in paying its payroll taxes - I
guess they were skating on the edge financially. Now they owe a heck
of a lot.

The IRS auditor, properly, is saying she wants to hold the
corporation officers personally liable. The problem is that she is
refusing to allow a payment plan. The taxpayers figure they can
afford to pay the taxes, interest and penalties, but only if they are
allowed to pay over time.

Is there anything you can think of to help convince the auditor to
allow a payment plan?

Thanks.
Are you, in fact, dealing with an auditor (Revenue Agent or
other Examination employee)? If so, her installment
agreement authority does not extend to in-business trust
fund taxes. See IRM 4.20.4.2(4)

"Installment agreements secured by Examination are
pre-assessment agreements and limited to Individuals (IMF)
without delinquent employment taxes, out-of-business sole
proprietors, and in-business (BMF) taxpayers (Form 1120,
"U.S. Corporation Income Tax Return" only)."

It's more likely you are dealing with a Revenue Officer or
other Collection employee. Can you confirm?
 
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S

Stuart A. Bronstein

paultry said:
Stuart A. Bronstein wrote:
Are you, in fact, dealing with an auditor (Revenue Agent or
other Examination employee)? If so, her installment
agreement authority does not extend to in-business trust
fund taxes. See IRM 4.20.4.2(4)

It's more likely you are dealing with a Revenue Officer or
other Collection employee. Can you confirm?
Her business card says Revenue Officer. Does she (or anyone else)
have discretion to allow an installment plan under the
circumstances?

What's a BFM taxpayer - I'm not familiar with that term.

Thanks.
 
P

paultry

Her business card says Revenue Officer. Does she (or anyone else)
have discretion to allow an installment plan under the
circumstances?

What's a BFM taxpayer - I'm not familiar with that term.

Thanks.
Okay, that fits - Revenue Officer in Collection. BMF =
Business Master File, which includes business related
returns including 94X, 1120, 1065, etc.

She has the discretion to allow an installment agreement in
accordance with IRM guidelines. See IRM 5
(http://www.irs.gov/irm/part5/index.html), including 5.7 and
5.14 (among others) to see if your circumstances fit.

The taxpayer will have to demonstrate full compliance with
filing and depositing requirements (stop the bleeding) and
inability to borrow or to liquidate non-essential assets to
full pay to get to a serious installment agreement
discussion. Note that there is a right to appeal rejections
of requests for installment agreements. (See IRM 5.14.9.8.)

As I may have said before on this forum, the IRM can be a
practitioner's best friend. This is the only game I know of
where the opposing team let's you see their playbook.

In addition, I'd strongly suggest consultation with a local
practitioner who specializes in collection matters (but NOT,
IMO, one of the many nationwide 1-800 tax reps).
 
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C

caj11

A small corporation has been remiss in paying its payroll taxes - I
guess they were skating on the edge financially. Now they owe a heck
of a lot.

The IRS auditor, properly, is saying she wants to hold the
corporation officers personally liable. The problem is that she is
refusing to allow a payment plan. The taxpayers figure they can
afford to pay the taxes, interest and penalties, but only if they are
allowed to pay over time.

Is there anything you can think of to help convince the auditor to
allow a payment plan?

Thanks.
I say, find out who her manager is, and try working with them on this. It has worked for me before.
 

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