Source: http://www.irs.gov/irm/part5/irm_05-001-011r-cont01.html
Timestamp: 2013-12-10 04:09:49
Document Index: 686158916

Matched Legal Cases: ['§7203', '§7203', '§7206', '§7512', '§7215', '§7201', '§7202', '§7207']

Internal Revenue Manual - 5.1.11 Delinquent Return Investigations (Cont. 1)
Section 11. Delinquent Return Investigations (Cont. 1)
5.1.11 Delinquent Return Investigations (Cont. 1)
5.1.11.6
No Return Secured
5.1.11.7
Del Ret Closures
5.1.11.8
Delinquency Check Programs
5.1.11.9
Rules and Restrictions with Respect to Collection Activities in Canada and Mexico
5.1.11.10
5.1.11.11
Creation of a Manual IDRS Del Ret Under Special Circumstances
Exhibit 5.1.11-1
Index for Questions and Answers to Assist in the Disposition of Del Rets(Reference: IRM 5.1.11.7)
Exhibit 5.1.11-2
Questions and Answers to Assist in the Disposition of Del Rets(Reference: IRM 5.1.11.7)
5.1.11.6 No Return Secured
5.1.11.6.2 (01-15-2010)Referral to Criminal Investigation
The Fraud Handbook, IRM 25.1, is the comprehensive guide for compliance functions. It covers the development of potential fraud issues, referrals
for criminal fraud, and the duties and responsibilities for joint investigations. Use this guide as a reference for identifying
and developing criminal investigation referrals. Fraud may exist where a taxpayer willfully attempts to illegally underreport taxes, not pay taxes, or both. Willfulness means
the individual acted deliberatively with the specific intent of violating the law.
Refer and discuss issues of potential fraud with the Fraud Technical Advisor.
You are responsible for identifying potential fraud and referring that taxpayer to Criminal Investigation. The majority of
criminal fraud cases will be established based on a taxpayer's: Willful failure to file a return (IRC §7203)
Willful failure to pay taxes owed (IRC §7203) Willful submission of a false financial statement under penalty of perjury (IRC §7206(1))
Failure to collect and deposit in a special trust fund account (IRC §7512 and IRC §7215)
Evasion of payment (IRC §7201) Willful failure to collect or pay over tax (IRC §7202)
Submission of fraudulent returns, statements, or other documents (IRC §7207)
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ 5.1.11.6.2.1 (01-15-2010)Preparing and Processing Fraud Referrals
Procedures for developing fraud referrals and preparing Form 2797, Referral Report of Potential Criminal Fraud Cases, are
contained in IRM 25.1.3.2, Preparation of Form 2797, and IRM 25.1.8,Collection Field Function.
Procedures for processing a fraud referral to Criminal Investigation (Cl) are as follows: If you suspect fraud, discuss the issues with your group manager.
If your group manager concurs, a conference will be held with you, your group manager, and the Fraud Technical Advisor (FTA).
Upon concurrence of the FTA, complete Form 11661–A, Fraud Development Status.
After approval of Form 11661–A by the FTA, the group manager or their designee will input ICS sub code 910 to the case. The
ICS sub code 910 will automatically trigger input of IDRS Transaction Code (TC) 971 with Action Code (AC) 281 on the entity
(this is not a modular specific transaction). The TC 971 AC 281 will stop the cycle clock and prevent the taxpayer entity
from being included in systemic IDRS/ENTITY case aging reports. Sub code 910 will remain intact until the group manager and
the FTA concur on its removal. Procedures for input and removal of sub code 910 and TC 971, AC 281 are contained in IRM 25.1.8.8,Aging of Collection Fraud Cases.
Fully develop the fraud referral with advice and guidance from the FTA and group manager.
If firm indications of fraud are confirmed, prepare Form 2797, Referral Report of Potential Criminal Fraud Cases. The fraud
referral should be a detailed, factual presentation of the taxpayer's affirmative acts of fraud, the evidence supporting those
affirmative acts, and the taxpayer's willful intent.
Submit Form 2797 to the group manager and FTA for approval.
After approval, the FTA will submit the Form 2797 to the CI Lead Development Center (LDC).
The CI LDC will process Form 2797 and promptly forward it to the appropriate CI Supervisory Special Agent (SSA).
Within 10 workdays of receipt of the Form 2797, the CI SSA will hold a five-way conference with you, your group manager, the
FTA, and the CI Special Agent. The purpose of the conference is to evaluate the fraud referral.
CI has 30 days to evaluate the fraud referral and to make a determination to accept it or decline it. A request for an extension
of time would require the approval of the Special Agent in Charge (SAC). A second five-way meeting will be held to discuss
the final determination of the case.
Once Cl has accepted the fraud referral, CI will input ≡ ≡ ≡ Active Criminal Investigation assignment. The ≡ ≡ ≡ will close
the module(s); however, you must do the following: For IMF cases, go to the ICS Del Ret Module Summary screen, select Close Mod and then select CI Referral (IMF only). This will close the Del Ret module as an acceptance to CI.
For BMF cases, once the ≡ ≡ ≡ posts to IDRS, you will receive a notification that the case is closed.
5.1.11.6.3 (01-15-2010)Enforcement Referrals - Individual Master File (IMF) Del Ret
If a determination has been made that a return is required (see IRM 5.1.11.6.1) fraud is not involved (see IRM 5.1.11.6.2) and other collection enforcement activities are not appropriate (see IRM 5.1.11.6) then a nonfiler may be referred for enforced collection of a delinquent return.
For Individual (MFT 30) nonfiler (Form 1040) referrals, evaluate factors such as type and source of income, amount of income,
and the complexity of the case to make the appropriate and most efficient enforcement referral. Each referral process has
limitations and specific requirements; however, always refer to the most efficient process when fraud is not involved.
Refer an Individual Master File (IMF) non-filed return (Form 1040) for enforcement to one of the following processes for preparation
of a Substitute for Return (SFR). This table lists the IMF SFR processes in order of most efficient to least efficient and
briefly describes limitations and restrictions of each process. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Process
Bal Due(s) allowed?
IRP income required?
High Income restriction
Memphis Campus Exam
5.1.11.6.3.1 (03-13-2013)Standalone Del Ret with IRP
The Automated Substitute for Return (ASFR) process prepares a Substitute for Return for individuals who fail to file after notification. ASFR uses Information Return Program (IRP) information posted to the Information Returns
Master File (IRMF) to calculate potential tax due and issue a Notice of Deficiency. If no return is secured 90-120 days after
the Notice of Deficiency is issued, ASFR assesses the tax due based on the calculation. Note:
If the taxpayer is overseas then the Service cannot assess until after 150 days. ASFR is authorized to prepare an individual’s income tax return under IRC 6020(b) and the regulations thereunder. The automated
process is located in the Brookhaven campus.
Refer standalone Del Rets to ASFR processing if the case meets ASFR criteria. The referral must meet a minimum "net tax due"
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and all of the following criteria: Note:
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ "
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ The Del Ret module is in Status 03. Note:
If the Del Ret module(s) is not in status 03, then take action to either accelerate status 02 modules or reverse the satisfying
transaction in status 06 modules.
There are less than 198 IRP documents for the tax year referred (if more than 198, see IRM 5.1.11.6.3.2). IRP exists on IRPTRJ for the module (if insufficient or no IRP posted to the IRMF for the delinquent year, see IRM 5.1.11.6.3.3).
There is no current or pending TC 530 on the account (see IRM 5.1.11.6.1, or IRM 5.1.11.6.3.2). There are no unresolved (status 22, 24, 26) Bal Due modules or associated modules in status 53 or 60 on ICS or IDRS. (see
IRM 5.1.11.6.1, Enforcement Determination or IRM 5.1.11.6.3.2). There are no -V, -W, -L, -Z, or Z- freezes on the module or account (see IRM 5.1.11.6.1).
The Select Code is not an IRS employee or CI selection code.
Document the ICS history with the ASFR referral decision and use "Transfer to ASFR (IMF Only)"
to reassign the Del Ret module to ASFR.
If contact is made with a taxpayer whose return is being prepared by ASFR, attempt to secure the return(s); however, do not
issue a summons if the taxpayer refuses to file.
If a return is secured for a period previously referred to ASFR that has not been assessed (no TC 290 or TC 300 posted), call
the campus ASFR Contact and fax the return there. The ASFR Contact information is located on the Who/Where tab on SERP at
http://serp.enterprise.irs.gov/databases/who-where.dr/asfr-contacts.htm. Mark the original return "Duplicate Original"
in red at the top and retain it in the case file. If the return is too large to fax, after calling the ASFR Contact mail
it to the following address: IRS ASFR
Holtsville, New York 11742-9013
If a return is secured for a period that has been assessed, then process the return as a Request for Reconsideration. See
IRM 5.1.15.4.3,