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25.3.3.2
(08-28-2006)
Refund Suits
-
This subsection covers Refund Suits.
25.3.3.2.1
(08-28-2006)
Responsibility
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Responsibility for different types of suits is as follows:
| If |
Then |
| the suit is by a
third party
|
Area Advisory |
| Trust Fund Recovery
Penalty is involved
|
Area Advisory |
| all other refund
suits
|
Campus Refund Litigation
Unit
|
25.3.3.2.2
(08-28-2006)
Initial Processing
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Fill Area Counsel requests for documents and transcripts.
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In Area Advisory, open a case on ICS. At the Campus, control the case
on IDRS.
-
If a tax module is in BAL DUE status, contact
the responsibility unit to determine whether collection should be withheld.
Note:
Under IRC § 6331(i), the CSED is suspended and levy action to collect
a TFRP assessment or other divisible tax is not permitted after refund litigation
has been filed, if the tax liability is attributable to tax periods beginning
after December 31, 1998. However, levy action may be taken if the taxpayer
files a written waiver allowing levy, if collection is in jeopardy, or if
the levy was made prior to the taxpayer filing suit. Recording of a NFTL is
not prohibited, and refund offsets under IRC § 6402 are allowable.
-
Input TC 520 with the appropriate closing code.
25.3.3.2.3
(08-28-2006)
Follow-up
-
Advise counsel of any change in the balance due.
-
Advisory monitored cases should be followed up as necessary, but no
less then semi-annually, until the litigation is concluded. You may use the
quarterly listings produced by LAMS.
-
ICS histories should reflect the current status of the litigation, including
forthcoming proceedings and court dates, and any settlement options being
considered by counsel.
-
If there is a balance due and the CSED is within one year, determine
whether the United States has counterclaimed for judgment.
| If |
Then |
| judgment has been
requested
|
input TC 520, cc
80
|
| otherwise |
seek advice from
Area Counsel.
|
-
If applicable, ensure that all notices of federal tax lien are timely
refiled.
25.3.3.2.4
(08-28-2006)
Closing Actions
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The following actions must be taken to close refund suits:
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Return all administrative files.
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If applicable, prepare abatement and refund documents as instructed by
counsel.
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If a counterclaim resulted in balance(s) due being reduced to judgment,
input TC 550 extending the CSED.
-
Reverse TC 520.
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Close the ICS or IDRS control.
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