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IRS Audits

Chapter 4. AIMS Processing

Section 25. Quick Assessments

4.4.25  Quick Assessments

4.4.25.1  (08-01-2003)
Introduction

  1. This chapter contains information and procedures on processing quick/prompt assessments. The term quick is used throughout the text although it applies to both quick and prompt assessments unless noted.

4.4.25.2  (02-08-1999)
Required Quick Assessments

  1. Situations requiring quick assessment action are as follows:

4.4.25.2.1  (08-01-2003)
Agreed Unpaid Deficiencies

  1. Agreed, unpaid deficiencies for income, estate, gift and certain excise taxes if the assessment CAN NOT be input through AIMS in the time frames stated below:

    • Less than $100,000 - manual assessment not required unless it meets one of the requirements below. Input through terminal.

    • $100,000 and greater - if the 23C date will not be within 30 days from agreement date.

     

4.4.25.2.2  (02-08-1999)
Statute of Limitations

  1. Statute of limitations will expire within 60 days.

4.4.25.2.3  (08-01-2003)
Bankruptcy Cases

  1. Bankruptcy petitions filed prior to October 1, 1979.

  2. Generally quick assessments are not required for bankruptcy petitions filed after October 1, 1979.

  3. If the account contains a "–V" freeze (TC 520 Bankruptcy with CC 85–89) the taxpayer is in bankruptcy status and making an assessment generally is prohibited by law.

  4. Contact the Examination Bankruptcy Coordinator or Technical Support for permission to make the assessment.

    IF advised THEN
    to make the assessment note the name and title of the person authorizing the assessment as well as the reason this assessment may be made in the "Remarks" section of Form 2859, Request for Quick or Prompt Assessment. Forward a copy of Form 2859 to Collection Technical Support.
    not to make an
    assessment    		 forward the case file to the Examination Bankruptcy Coordinator. In the Remarks section of Form 3198 note the information about the bankruptcy and the name and title of the person in Technical Support providing the information.

     

4.4.25.2.4  (02-08-1999)
IRC Section 6871

  1. Deficiencies involving bankruptcy and receivership cases under IRC Section 6871, Claims for Income, Estate, Gift, and Certain Excise Taxes in Receivership Proceedings, etc.

4.4.25.2.5  (08-01-2003)
Amended Return

  1. Taxable amended returns received within 120 days of statute expiration.

4.4.25.2.6  (02-08-1999)
$100,000,000 Assessments

  1. Quick assessments cannot be transferred to Master File for amounts of $100,000,000 (100 million) or more. Such assessments must be split and processed as multiple assessments on separate assessment documents. Ensure the campus Accounting Section is alerted that the assessment is being split due to the assessment being $100,000,000 or more.

4.4.25.3  (02-08-1999)
Required Research

  1. ALWAYS obtain current account research data when a quick assessment is warranted.

4.4.25.3.1  (02-08-1999)
IDRS History Item

  1. Research CC TXMOD for a control base or history item that indicates a quick is already in process. Contact the employee for information.

4.4.25.3.2  (08-01-2003)
Retention Register

  1. If an account has been moved to the retention register, it must be brought back to Master File to prevent the quick assessment from going unpostable when it is transferred to Master File.

    Note:

    Do not delay in performing the quick assessment action while the account is being brought back to Master File.

     

  2. When an account is moved back from retention, Master File automatically sets an "–I" freeze on the account. Therefore, interest must be calculated and input with TC 340, to prevent the account from unposting when the quick assessment transaction is transferred-in to Master File.

    Note:

    If an IMF account went to retention in 1994 or subsequent, CC IMFOLR will automatically reestablish the account back to Master File. If a BMF account went to retention in 1995 and subsequent, CC BMFOLR will automatically reestablish the account back to Master File. An "-I" freeze for a restricted interest computation will not be generated if brought back in this manner.

     

4.4.25.3.3  (02-08-1999)
Payment

  1. ALWAYS research CC TXMOD to determine if a payment has been input, but has not posted to Master File.

  2. To prevent the erroneous release of the payment, do not process the second adjustment document through AIMS until the payment posts to Master File. Refer to IRM 4.4.25.9 for complete instructions for processing the second adjustment document for quick assessments.

4.4.25.3.4  (02-08-1999)
Address

  1. The taxpayer’s most current address must be used.

4.4.25.3.5  (02-08-1999)
Civil Penalty Name Line

  1. For civil penalty assessments, MFT 55 ONLY, a civil penalty name line must be present at Master File PRIOR to requesting the quick assessment. Input Form 2363 if necessary.

4.4.25.4  (08-01-2003)
Quick Assessment Forms

  1. Use Form 2859, Request for Quick or Prompt Assessment, to request a quick assessment. Include a Form 8278, Computation and Assessment of Miscellaneous Penalties if applicable.

4.4.25.4.1  (02-08-1999)
Form 2859

  1. Requests for quick assessments will be made to the campus Accounting Branch, Accounting and Control Section, Journal and Ledger Unit on Form 2859. Instructions for completing Form 2859 are on the back of Part 4 of the form. In addition:

    1. Indicate in "Remarks" if billing needs to be withheld.

    2. Enter the 23C Date and the DLN assigned.

    3. Enter an agreement date only if the taxpayer signed an agreement and interest is being assessed with TC 190.

    4. Do NOT compute interest on civil penalty assessments.

     

4.4.25.4.1.1  (02-08-1999)
23C Date

  1. Use the following to determine the 23C date.

    IF the statute date
    will expire    		 THEN the 23C date will be
    within two days the same day that the assessment is faxed to the Accounting function
    in more than two days the fifth work day after the assessment is faxed to the Accounting function

     

4.4.25.4.1.2  (08-01-2003)
Blocking Series

  1. The blocking series for Quick assessments are:

    • Agreed Exam: 130-131

     

    • Unagreed Exam: 132-134

     

  2. The blocking series for Prompt Assessments are:

    • Agreed Prompt: 150-154

     

    • Unagreed Prompt 155-159

     

4.4.25.4.1.3  (02-08-1999)
Credit Adjustments

  1. Requests for quick assessments may involve an abatement or an increase or decrease in credits (Item 15, Form 5344 and 5403).

4.4.25.4.1.3.1  (02-08-1999)
Net Increase in Credits

  1. The total to be assessed must include these adjustments in Part C, items 19 & 20 of Form 2859.

4.4.25.4.1.3.2  (02-08-1999)
Abatement or Net Decrease in Credits

  1. The manual assessment document going to Accounting Branch cannot include an abatement nor a credit increase. Enter on Form 2859, as a "memo credit," the amount of the abatement and/or credit increase. Item 23 in Part C should not include any pending credit transfers. The abatement and/or credit increase adjustment must be processed on an additional adjustment document. Abatement of penalties should be shown in Part C, Item 25.

  2. If a decrease in tax is involved, enter on Form 2859 as a "memo credit," the amount of tax decrease and the cycle the Form 5344 or 5403 post.

  3. If excess credits are present and additional deficiencies will be assessed, enter a TC 570 with a zero amount to prevent the credit from refunding.

4.4.25.4.1.4  (02-08-1999)
Deficiency/Overassessment

  1. Prompt, jeopardy or quick assessments may sometimes involve a deficiency for one tax period and an overassessment for another tax period. Process these situations as follows:

    1. For the overassessment tax period(s), manually compute the interest and enter it with the applicable transaction code on the adjustment document along with a Hold Code 2.

    2. Prepare Form 2424 to manually transfer the applicable credit (TC 820 debit) from the overassessment year to the deficiency year (TC 700 credit with secondary TC 570 blank) . If ALLOWABLE interest is involved use a second Form 2424.

    3. Place the following caption on Form 2859 to alert the Accounting Branch of the available credit: "Credit of $ (amount) being transferred from (period)." Attach the Form 2859 to the deficiency year and forward to Accounting Branch.

    4. Forward the overassessment document for processing.

    5. Forward Form 2424 for processing. Form 2424 should be input in the same cycle as Form 5344 or a later cycle. It should never be input in an earlier cycle.

     

4.4.25.4.1.5  (02-08-1999)
Delinquent Return Quick Assessment

  1. When the quick assessment is for tax shown on a secured delinquent return, process the same as fo