Per the IRS Education Provider Standards this course must be COMPLETED by 12/31/2025 to receive credits. NOTE: Go to My Professional Profile in your CCH CPELink account settings to ensure your name, and PTIN number; matches your PTIN card
Statistics show that over 30 million individual taxpayers file a tax return with an unpaid balance due. Unfortunately, some are our clients who fall on hard times and cannot fully pay their tax obligations. Fortunately, there are options when they cannot fully pay their liability.
In this course, join Jim Buttonow as he explores the six IRS alternatives when your client cannot fully pay their liability, the IRS collection alternatives. This course will examine the rules and requirements for installment agreements, extensions to pay, and payment deferrals (namely, currently not collectible status). We also give you the fundamental knowledge to answer your client’s question on whether they can “settle their tax bill’ for less than the amount owed (i.e. the IRS offer in compromise qualification rules). At the end of the course, you will have the basic knowledge to identify what alternative is best and be able to execute that alternative in the most efficient and effective manner for your client.
Publication Date: October 2022
Designed For
Tax professionals and tax firm leaders who need to help their clients evaluate, select, and execute IRS collection alternatives when they cannot full pay their balances owed to the IRS.
Topics Covered
- Options for Clients Who Cannot Pay the IRS
- IRS Collection Alternative Principles
- How to Set Up a Collection Alternative
- IRS Collection Statute Expiration Date (CSED)
- Actions Can Extend the CSED
- Getting a Payoff Amount from the IRS
- IRS Forms for Simple Installment Agreements
- Collection Agreements
- IRS Online Payment Agreement (OPA)
- IRS Collection Alternatives - Complex Ability-to-pay Options
- Components of Determining Ability to Pay
- Determining Average Monthly Household Income
- Determining Average Allowable Monthly Household Expenses
- Three Types of Expenses for Individuals
- Expenses Limited by IRS Collection Standards
- 2022 Expense Limitations
- IRS Form 433 and IRS Expense Limitation Rules
- Documentation Required for ATP Agreements
- IRS Forms for Ability to Pay Agreements
- 3 Types of OICs
- IRS Offer in Compromise Program
- Qualifying for an OIC
- 5 Components of an OIC
- OIC Qualification/Offer Amount Formulas
- Two OIC Payment Options
- OIC Practical Considerations
- The Realities of the IRS OIC Program
- Practice Lien and Levy Avoidance
- Using the Extension to Pay for a Levy Release
- Lien Avoidance: Use the ETP/SLIA Combo
- IRS Field Collection
- Avoid Payment Plan Defaults
- Appeal Adverse Collection Determinations
- Get into a Payment Plan to Reduce FTP Penalty
- Abate Penalties Toward the End of the Payment Plan
- Changes in IRS Collection Alternatives
- Reference Guide
Learning Objectives
- Identify trends in IRS collection and collection enforcement
- Recognize how to help your client avoid enforced IRS collection (liens, levies, and passport restrictions)
- Recognize how to explain IRS collection alternatives
- Recognize how to determine which alternative is best
- Recognize and apply the rules for the various types of IRS installment agreements, currently not collectible status, and extensions to fully pay
- Identify when an offer in compromise is a viable alternative for your client
- Recognize how to advise your client which IRS collection alternative is best for their situation
- Identify approximately how many taxpayers currently owe the IRS for back taxes based on recent IRS statistics
- Identify the IRS form that relates to a balance due notice
- Identify the type of collection alternatives that can be done online at IRS.gov
- Identify the IRS collection alternative that has a high level of effort
- Identify on average, the percent of IRS payment plans that are defaulted each year, mainly due to missed payments and/or new unpaid balances
Level
Basic
Instructional Method
Self-Study
NASBA Field of Study
Taxes (2 hours)
Program Prerequisites
None
Advance Preparation
None
Instructor
Jim Buttonow
Jim Buttonow, CPA, CITP, has been a leader in helping taxpayers and tax professionals resolve tax problems with the IRS.
For 19 years, Jim worked at the IRS in various compliance enforcement positions. Since 2006, Jim has been in private practice and tax and accounting software development. Jim consulting practice focuses on the areas of tax controversy and tax administration. Jim led product development and marketing for a successful software company that developed tax problem software for tax professionals and has developed and implemented post-filing tax services to large tax providers, such as H&R Block and Jackson Hewitt. This software is currently being used by tens of thousands of tax professionals and businesses in the United States.
Jim has been an IRS partner in improving IRS operations and post-filing service to taxpayers. Jim served as chairperson of the IRS Electronic Tax Administration Advisory Committee (ETAAC) in 2015 and 2016 during which ETAAC played a central role in promoting the IRS digital strategy to develop transformative technology solutions to systemic challenges in tax administration. Jim also served as the North Carolina representative on the IRS’ Taxpayer Advocacy Panel (TAP) from 2020-2022.
Jim regularly speaks on areas of tax administration and problem solving to national associations and has testified before Congress in areas of tax administration. He has also published many articles in industry publications. In his articles, Jim focuses on delivering practical insights, advocating for IRS transparency and efficiency, and proposing innovative large-scale solutions for taxpayers and tax professionals.
Jim currently authors the Tax Problems and Solutions Handbook, a publication aimed at helping tax pros work more effectively in post-filing matters and resolving their clients’ most common tax problems. The book can be found online at TaxProblemsHandbook.com. Jim can be reached at Jim@buttonowcpa.com or at his website at buttonowcpa.com.