The Administration of Partial Payment Installment Agreements Needs Improvement

The Director, Collection Policy, Small Business/Self-Employed (SB/SE) Division, should inform taxpayers of the availability of Partial Payment Installment Agreements (PPIAs) and provide outreach and information in the following areas: 1) tax topics and tips on the IRS public website; 2) Form 9465 instructions by specifically referencing PPIAs (including what is required to qualify for a PPIA) and by indicating that, if taxpayers cannot afford to pay enough to repay the total amount due, then they should indicate what they can pay in box 11a on Form 9465; and 3) collection notices (Collection notice stream series).

The Director, Collection, Small Business/Self-Employed (SB/SE) Division, should collaborate with impacted internal stakeholders, including the Taxpayer Experience Office and the Taxpayer Advocate Service, to explore and consider additional potential changes to the instructions for Form 9465 concerning Partial Payment Installment Agreements (PPIAs).

The Director, Collection Policy, Small Business/Small-Employed (SB/SE) Division, should collaborate with the Wage and Investment Division’s Director, Modernization, Development, and Delivery, to extend Accounts Management Services (AMS) history note retention requirements pertaining to taxpayers’ Forms 433-F and financial analyses.

The Director, Collection Policy, Small Business/Self-Employed (SB/SE) Division, should remind Collection employees of the requirement to conduct a financial analysis to determine a taxpayer’s ability to pay and to document the analysis when considering Partial Payment Installment Agreements (PPIAs).

The Director, Collection Policy, Small Business/Self-Employed (SB/SE) Division should request a change to Computer Paragraph 522, Installment Agreement – Review Financial Condition, to notify taxpayers that the financial information they provide may result in a higher or lower installment amount or no change to their installment amount.