8.23.4. Acceptance, Rejection, Withdrawal and Default Procedures for Non-Collection Due Process (CDP) Offers

(1) The procedures to close an OIC appeal vary according to the final Appeals decision of the case. This IRM section discusses the actions to take and documents to prepare to close the different OICs.

(1) Authorities that are related to the offer program are:

• IRC 7122 – Compromises, granting broad authority to compromise tax liabilities to the Secretary of the Treasury.

• Treasury Regulation 301.7122-1, authorizing the Commissioner of Internal Revenue to compromise a liability on any one of three grounds: Doubt as to Collectibility (DATC), Doubt as to Liability (DATL), or to promote Effective Tax Administration (ETA).

• Policy Statement P-5-89, Offer may be rejected for public policy reasons.

• Policy Statement P-5-97, Stay of collection - offer in compromise cases.

• Policy Statement P-5-100, Offers will be accepted.

• Treasury Regulation 300.3 – Offer to compromise fee.

• Revenue Procedure 2003-71, 2003-2 CB 517, defines the procedures applicable to the submission and processing of offers to compromise tax liabilities.

• Notice 2006-68, 2006-2 CB 105, provides additional guidance regarding offers submitted on or after July 16, 2006. This handbook further describes, in detail, those procedures.

• Tax Increase Prevention and Reconciliation Act of 2005 – Section 509 (TIPRA) – Legislation enacted in May 2006, which made major changes to the OIC program.

• IRM 1.2.2.6.1, Delegation Order 5-1 (Rev. 5), delegates the Commissioner’s authority to accept, reject, return, terminate, or acknowledge withdrawals of offers.

(2) The Taxpayer Bill of Rights (TBOR) lists rights that already existed in the tax code, putting them in simple language and grouping them into 10 fundamental rights. Employees are responsible for being familiar with and acting in accord with taxpayer rights. See IRC 7803(a)(3), Execution of Duties in Accord with Taxpayer Rights. For additional information about the TBOR, see Publication 5170, Taxpayer Bill of Rights and TBOR link, https://irssource.web.irs.gov/Lists/General%20News/DispItemForm.aspx?ID=126.

(1) The Policy Analyst shown on the Product Catalog page, as the originator, is the assigned author of this IRM.

(1) The Appeals Centralized Database System (ACDS) is used by ATEs and Tax Examiners (TEs) as a method for casefile intake and closing, inventory control, statute validation, and history documentation.

(2) Small Business/Self-Employed (SB/SE’s) AOIC program is used to track offers submitted by taxpayers and record case actions.

(1) PPQ&A provides trends and data analyses and detailed summary reports for Appeals.

(1) See IRM Exhibit 8.1.1-1, Common Terms Used in Appeals, for common terms and definitions used in IRM Part 8.

(1) Before preparing the closing documents, check the Integrated Data Retrieval System (IDRS) to make sure there are no pending liabilities that are not included on the Form 656. Matters that will later require the time and attention of the ATE and other IRS personnel can be avoided by checking for and resolving possible pending liability issues before closing out the case. The following are some ways to look for possible pending liabilities:

• Check IDRS Command Code (CC) AMDIS

• Check IDRS CC UNLCER to see if there are any Trust Fund Recovery Penalties (TFRP) not listed on the Form 656

• Look for Transaction Codes (TCs) 420, 922, 976 or 977 to see if there is an amended return or any examination or under-reporter activity

If an open audit is found, follow the instructions in IRM 8.23.3.3.1.5, Coordination with Other Functions.

Caution: Carefully review published ex parte communications guidance before contacting another function. The ATE must document the case activity record with the purpose of the contact, what was discussed and any information that was exchanged. See IRM 8.1.10, Ex Parte Communications.

Note: Also check to confirm that no unreversed TC 520 has posted or is pending for any period being compromised. TC 520 with closing codes 60-89 indicates that the taxpayer is involved in a bankruptcy or other litigation. Contact Advisory, Insolvency, and Quality (AIQ) to determine the nature of the litigation and whether the IRS has authority to accept the offer. If a case has been referred to the Department of Justice (DOJ), settlement authority belongs solely to DOJ.

(2) Check on IDRS (TXMOD/IMFOL/BMFOL) for transaction codes TC 766 CRN 263 and TC 971 AC 114 or TC 971 AC 115 to identify IRC 965(h) and 965(i) election accounts. If these transaction codes are on accounts to be recommended for offer acceptance, see IRM 5.8.4.23.7, IRC 965 (Transition Tax) Liabilities.

(3) Verify that no restitution-based assessment periods are included on the accepted offer. Restitution periods may be identified with TC 550 with an indicator of 04. The offer cannot be accepted by IRS unless the restitution tax period(s) are removed from the Form 656. See IRM 5.8.4.24.1, Offers in Compromise Submitted that Include Restitution.

(4) If the offer includes Trust Fund Recovery Penalty (TFRP) assessments, confirm that all assessments are listed on the Form 656. The Form 7249, Form 656 and/or Form 14640, Addendum to Form 656, must match by reflecting each assessed TFRP period.

(5) An amended Form 656 or addendum secured by Appeals does not require a signature of an IRS representative as the "Authorized Internal Revenue Service Official" on Form 656. Since each offer only has one TC 480 date, a second signature may confuse APS or COIC and cause an erroneous input of another TC 480 date. Additional periods may be added to the existing Form 656 without an amended Form 656 or an addendum if the provisions in IRM 5.8.8.3, Pen and Ink Changes to Form 656, are met.

(6) Prior to requesting an AOIC Form 7249 for Collection-sourced OICs and all CDP-OICs (including CDP-DATLs), the ATE will secure any related offers, with application fees and initial payments, if applicable, and process them in accordance with IRM 8.23.3.4.3(7), Amended Offer – TIPRA Related Issues. When the ATE has been notified that the related offer has been processed and is assigned an offer number and WUNO, the ATE may proceed to request an AOIC Form 7249.

(7) For Collection-sourced OICs and all CDP-OICs, including DATLs, the ATE will complete and submit a request for an AOIC generated Form 7249 following the guidance in Exhibit 8.23.4-1

(8) For Examination-sourced OIC-DATLs, the ATE will complete and submit a request for an AOIC generated Form 7249 following the guidance in Step Chart for AOIC Generated Form 7249 for Examination-sourced OIC-DATLs, Exhibit 8.23.4-2.

(1) The ACM for an accepted offer should contain the following:

1. The amount of the original offer and a description of the payment terms.

2. The amended offer amount, if applicable, and a description of its payment terms.

   Note: Provide a complete explanation and discussion of the computation of the amount of the offer that is being recommended for acceptance.

3. The type of tax and periods (if the report covers individual and joint liabilities, state them in separate paragraphs).

   Note: If a tax period that was part of the original offer is subsequently paid in full via TIPRA payments, the period must still be listed on any amended offer. Even though the tax period is fully paid, the funds used to satisfy it are part of the overall offer amount, so the tax period must remain on the Form 656. If a tax period is paid in full via a non-TIPRA payment, such as a refund offset, there is no need to list such period on the amended Form 656.

4. The cause of the tax problem and status of current compliance, as needed. See IRM 8.23.2.6, Taxpayer Compliance Issues, and its related subsections andIRM 8.23.2.7, When a Taxpayer Does Not Remain in Compliance, for the appropriate treatment of compliance issues.

5. Compliance's reasons for rejecting the offer.

6. The issues raised by the taxpayer.

7. An analysis of the taxpayer's financial condition including any documentation on which the ATE’s position is based (e.g., type, location and condition of assets and the taxpayer's age, health, education, and future income prospects).

8. A comparison of the financial figures provided by the taxpayer, the amounts allowed by Collection, and the amounts allowed by Appeals. If the taxpayer amends the offer to the reasonable collection potential (RCP) amount determined by Collection and the ATE agrees that this is the proper amount, there is no need for the financial figure comparison. Instead, attach a copy of Collection's financial analysis tables to the ACM.

   Reminder: It is important for the ATE to document a clear and complete explanation of the factors considered in accepting the offer. This may include information that was not previously provided to Compliance or a different interpretation of the facts of the case or of IRM policies and procedures.

9. The source of the offer funds.

10. The total amount of TIPRA payments already applied to the offer.

11. An affirmative statement that the offer being recommended for acceptance reflects the reasonable collection potential or that special circumstances exist that otherwise justify compromise.

12. An explanation of the special circumstances justifying acceptance under Doubt as to Collectibility with special circumstances (DATC-SC) or Effective Tax Administration (ETA) and why payment of more than the offered amount would either cause the taxpayer to be unable to meet necessary living expenses or would undermine public confidence that the tax laws are being administered in a fair and equitable manner.

    Reminder: DATC-SC and ETA acceptance recommendations also require an affirmative statement indicating acceptance of the offer would not undermine other taxpayers' compliance with the tax laws.

13. If the offer being accepted involves a federal employee, a discussion of whether public policy implications exist based on the sensitivity of the employee's position or area of responsibility should be documented.

Note: To facilitate a rapid and organized completion of the IET/AET and acceptance memorandum, consider using the Form 14559, Appeals Offer in Compromise Acceptance Memorandum, which is available on the Electronic Publishing website.

(2) The ATE is responsible for inputting the following data on the customized Form 5402:

• Amount of the outstanding liability

• Amount of the taxpayer's original offer

• Amount of RCP determined by Appeals

• Amount of the accepted offer

(3) If the offer is accepted for less than the RCP on the basis of economic hardship either as Doubt as to Collectibility with Special Circumstances (DCSC) or Effective Tax Administration (ETA)], 26 CFR 300.3(b)(2) provides that the IRS apply the fee to the offer terms, or refund the fee to the taxpayer if the taxpayer requests it. For DCSC or ETA offers that are accepted, document Form 5402 under Remarks with the instructions to Monitoring OIC (MOIC) whether to refund the application fee to taxpayer or apply it to the offer terms.

(4) When recommending acceptance of two or more related offers based upon a single financial analysis, only one ACM is necessary. To ensure proper processing of the related offers, create separate files/folders marked "1 of 2," and "2 of 2," etc. It is unnecessary to duplicate information pertaining to both taxpayers, but the separate files/folders should contain the documents listed below in paragraph (5), except for only one consolidated ACM.

(5) Review the Delegation Order at IRM 1.2.2.6.1.1, Acceptance Authority, to determine the appropriate approving official.

(6) When accepting a non-CDP offer, prepare and assemble the following:

1. Form 7249, Offer Acceptance Report, with a IDRS transcript (TXMOD, IMFOLT) for each tax liability listed, if Counsel’s opinion is required.

   Note: The approved Form 7249 should be uploaded to the OIC WUNO in ACDS as an attachment.

2. A copy of Form 7249 for the Public Inspection File (PIF).

3. Customized Form 5402 generated from APGolf.

   Note: If the offer was amended due to a change in basis per IRM 8.23.3.4.1

   , Amended Offers - Change in Offer Basis or Other Circumstances, note in Form 5402" Remarks" for APS to update AOIC with the change in basis.

4. ACM

5. Letter 5490, OIC Acceptance Letter, or Letter 5521, DATL OIC Acceptance Letter.

6. Form 656, Amended Form 656, and/or Form 14640, Addendum to Form 656, if applicable.

7. Collateral agreement, if applicable.

(7) Enclose a copy of the Form 656 and any collateral agreements with the taxpayer's (and POA's) copy of the OIC Acceptance Letter.

(8) The Fair and Accurate Credit Transactions Act of 2003 requires that persons who dispose of credit information take reasonable measures to protect against unauthorized access to or use of credit information in connection with its disposal. IRM 5.1.18.19, Consumer Credit Reports, and IRM 5.8.8.15, Destruction of Credit Reports, contain information on credit report usage and disposal requirements. The credit report should remain in the case file until all reviews are complete. The credit report must be removed and properly disposed prior to sending the file to APS for closing. Follow these procedures for proper disposal of credit reports:

(9) See IRM 8.20.7.49, Offer in Compromise (OIC) Non-CDP Cases, for APS OIC case closing procedures.

(1) IRC 7122(b)requires an opinion from Counsel to be placed in the file if the liability, including tax, penalties and interest, is $50,000 or more. Counsel’s review has two separate and distinct components:

1. Certification that the legal requirements for compromise were met.

2. If the legal requirements for compromise were met, then Counsel reviews the proposed acceptance for consistent application of the Service’s policies regarding acceptance.

(2) The requirement for Counsel review is based on the aggregate liability, including additions and accrued penalty and interest, on Form 7249 for all related offers on the same taxpayer at the time the offer is submitted for approval, if $50,000 or greater.

(3) Under Chief Counsel Directives Manual (CCDM) 33.3.2, Legal Advice, Other Legal Advice, Offers in Compromise, Counsel’s finding that a proposed acceptance is not in keeping with IRS policy is not a justification for withholding an opinion if all of the legal requirements for compromise have been met. If Counsel signs the Form 7249 but disagrees with the amount of the offer, they will communicate their disagreement in a separate memorandum.

(4) Although Counsel’s opinion is required for compromise, its concurrence with Appeals’ decision to accept the offer is not required. However, the Appeals approving official must review and carefully consider Counsel’s opinion prior to accepting the offer. If Counsel raised substantive issues, it is appropriate to document the case activity record to reflect that the approving official carefully considered those issues before accepting the offer.

(5) If the offer meets the legal requirements for compromise but Counsel did not sign the Form 7249 because it disagreed with Appeals’ application of IRS policies, Appeals may still accept the offer. The ATE will document the case history, include in the case file a copy of Counsel’s memorandum or other communication expressing its opinion and note this IRM reference in Counsel’s signature line on Form 7249.

(6) If an offer is returned by Counsel to address specific errors and those errors have been addressed, the ATE will not resend the case to Counsel for review unless the terms of the offer changed.

(7) When an OIC is accepted in the situations described in (5) above, the Appeals management level that is required for approval of these cases does not change.

(8) If acceptance of the offer is subject to Counsel’s legal requirements review, proceed as follows:

a. The ATE will create an electronic file by scanning and e-mailing or faxing to their e-fax number the following documents (where applicable), (the documents appear in their preferred order with the F7249 on top):

• Form 7249, Offer Acceptance Report

• IDRS Transcripts (TXMODs or IMFOLT/BMFOLT; SUMRY or IMFOLI/BMFOLI). See IRM 5.8.8.7, Required Actions Prior to Closing an Offer as an Acceptance.

  Note: IDRS transcripts are sufficient to prepare AOIC Form 7249 and to provide to Counsel. It is no longer necessary to request account transcripts from Shared Team of Administrative & Redaction Support (STARS).

• Form 1271, Rejection or Withdrawal Memorandum – if included in the administrative file

• Form 656, Offer in Compromise, or Form 656-L, Offer in Compromise (Doubt as to Liability), including any addendums

• IMFOLI/BMFOLI print

• OIC Acceptance Letter (Letters 5490 or 5521)

• Appeals Case Memorandum (Form 14559 may be substituted)

• Appeals Reasonable Collection Potential Tables (unless embedded in Form 14559)

• Appeals Case Activity Record

• Compliance’s case history (AOIC history, if included. Do not submit ICS history.)

• Form 433A/B, Collection Information Statements, (not including attachments)

• Any previous Counsel Memorandum in the case file (including those not solicited by Appeals)

• Form 5402, Appeals Transmittal and Case Memo

b. The ATE will save the electronic file on their computer and will upload the documents to Counsel’s SharePoint site and assign the request to the ATM for review.

c. The ATE will update ACDS by inputting CARATS Action Code "AC" with Sub-Action Code "DC" to the OIC Work Unit Number (WUNO).

d. The ATM will review the approval documents through the SharePoint site and, if approved, will assign the case to Counsel by updating the SharePoint case status. If the acceptance recommendation is not approved at the ATM level, the ATM will close the request and notify the ATE.

e. Counsel will complete the review of the documents through SharePoint and electronically sign Form 7249. The signed documents will be returned by Counsel to the Appeals ATM through SharePoint by updating the case status.

Note: Upon closure of a case in which Counsel’s opinion did not recommend acceptance and Appeals agrees with the opinion, either the ATM or the ATE must input an entry into CARATS to explain Counsel’s decision and the general reason(s) why the offer was rejected. If Appeals does not agree with Counsel’s opinion, Appeals will proceed with the acceptance following guidance in IRM 8.23.4.3.2(5). The case will not be resubmitted to Counsel unless the terms of the OIC have changed.

f. Upon receipt from Counsel the ATM will send the signed and dated Form 7249, the signed acceptance letter and signed Form 5402 to the ATE who will update ACDS by inputting:

• CARATS Action Code "AC"

• Sub-Action Code "FR"

g. The ATE will ensure all final OIC documents are electronically attached to the OIC WUNO and uploaded to ACDS, including the Form 656, Form 7249 and IDRS transcripts and any memorandum from Counsel.

h. The ATE will then send a secure email request to the ATM to input the ATM Approval Date (ACAPDATE) when closing actions have been completed on the OIC.

Note: If the ATM is not the approving official, the ATM will not sign the acceptance letter or Form 5402 after receiving the case back from Counsel. Instead, the ATM will forward the documents to the approving official based on IRM 1.2.2.6.1.1, Acceptance Authority, for review and approval. Once the ATE receives the signed Form 7249, OIC Acceptance Letter and Form 5402 from the approving official, the ATE will input the "AC/FR" action and Sub-Action codes and the ATM will input the ACAPDATE.

i. The ATE or ATM will forward the case to APS for closing actions after ensuring any credit reports have been removed from the case file and destroyed per IRM 8.23.4.3.2, Accepted Offer Closing Documents and Appeals Technical Employee Procedures.

(9) See Steps for Preparing and Submitting OIC for Counsel Review, Acceptance Approval, and Closure, Exhibit 8.23.4-3.

(1) 26 CFR 601.702(d)(8) requires that a PIF of all accepted OIC cases be available for inspection for one year from the date of acceptance in the location determined by the Compliance Area Director within the Small Business and Self-Employed Division (SB/SE).

(2) The PIF consists of a properly completed, signed and dated Form 7249.

(3) SB/SE has established a SharePoint site for the electronic storage of the PIF.

(4) TEs in APS will load the electronic PIF to the SharePoint site. After the electronic PIF has been uploaded to the SharePoint site, Appeals employees identified as gatekeepers will access the PIF and review the file to:

1. Ensure that Form 7249 is complete, contains the appropriate signatures and has been dated in the upper right hand corner of the form.

2. Insure that any "in care of" names are redacted.

3. Verify that transcripts are not attached to the PIF.

(5) If the Form 7249 is complete and has been properly dated and signed, the gatekeeper will move the PIF from the Appeals library to the correct PIF location folder and correct PIF date sub-folder.

(6) If the PIF file has not been dated properly, the gatekeeper will send an email to the TE notifying the TE of the error and will return the file to the TE for correction.

(7) If there are any other errors on the Form 7249, the gatekeeper will send an email to the ATE advising them of the error and will return the file to the approving official to have the document corrected.

(8) If the PIF file is returned to either the TE or ATE for correction, they will make the necessary corrections and return the document to the gatekeeper via secure email. The gatekeeper will upload the corrected PIF to the correct SharePoint folder.

(1) The ACM for a case in which Appeals sustains the rejection of the offer should contain the following:

1. Sufficient information and explanation to support the final decision, including a complete financial analysis.

   Note: The ACM should reflect the conclusion reached by the ATE with ultimate responsibility for the case, including "review and concurrence" requirement and management approval. Also see IRM 8.6.2.2, Introduction to Appeals Case Memos (ACMs).

Note: If the decision is simply to sustain Collection's RCP determination, the Offer Examiner's financial analysis tables (Income/Expense Table (IET), Asset/Equity Table (AET) or Full Pay Worksheet) are sufficient.

2. Any counter proposals either offered to or received from the taxpayer.

3. Information on the disposition, either a refund or application to a tax liability, of any offer deposits.

Note: The Customized OIC Form 5402 may be used in place of an ACM if there is sufficient room to reflect the above items. Also, consider using the Form 14559, Appeals Offer in Compromise Memorandum, which is available on the Electronic Publishing website.

(2) The ATE is responsible for inputting the following data on the Customized OIC Form 5402:

• Amount of the outstanding liability

• Amount of the taxpayer's original offer

• Amount of RCP determined by Appeals

(3) Review the Delegation Orders at IRM 1.2.2.6.1.2, Rejection Authority, to determine the appropriate approving official to sustain rejection of the offer.

(4) When recommending Appeals sustain rejection of the non-CDP offer, prepare and assemble the following:

1. Customized OIC Form 5402 generated from APGolf.

2. ACM, if necessary.

3. An undated Letter 5197 to notify the taxpayer that Appeals sustained rejection of the offer.

4. Form 3040, Authorization to Apply Offer in Compromise Deposit to Liability, or other written authorization (if applicable).

5. Form 1271, Rejection and Withdrawal Memorandum. Include this form if it was prepared by Collection. Do not prepare a Form 1271 if there is none in the file.

Note: Consider the use of Form 14561, Income and Expense/Asset Equity Calculation Table, as a means to complete the IET/AET or Form 14559, Appeals Offer in Compromise Memorandum, to include an abbreviated ACM.

(5) If the liability at issue is a TFRP or PLET and the ATE agrees to adjust or abate the amount of the TFRP or PLET, the ATE is responsible for preparing the Form 3870. Ensure that the Form 5402 properly instructs APS to forward the Form 3870 and the TFRP/PLET administrative file to the appropriate Collection Advisory Unit. The ATE is responsible for providing APS with the address of the appropriate Advisory Unit. The Form 5402 contains instructions for determining the appropriate Advisory Unit.

(6) Once all of the above documents are complete and assembled, update the ACDS case status to 'AC/FR' and submit the case file to the ATM for approval.

(1) When a ATE sustains the rejection of a non-CDP offer, Appeals’ jurisdiction of the case is relinquished.

(2) An offer will not be reopened:

• To reconsider the earlier decision based upon the same facts and circumstances.

• To consider new facts and circumstances that arose after the rejection.

• Because a taxpayer can now fund an offer they were previously unable to fund.

(3) The ATE cannot reconsider a rejected offer case except under the following circumstances which should be documented in the case history record:

• The ATE sustained a rejection because the taxpayer failed to timely provide requested information and it is later learned that the information was provided timely but was misrouted or misidentified by Appeals or IRS.

• The ATE sustained a rejection because the taxpayer was unable to meet an unreasonably short response deadline.

  Note: An unreasonably short deadline is defined as less than 14 calendar days from the date of the request.

• The ATE made a significant computational error in determining RCP.

• The taxpayer failed to respond to the ATE and it is later learned that this was due to an emergency situation (e.g., medical emergency, natural disaster, etc.).

(4) When presented with a request to reopen a returned offer, consider all factors, including the taxpayer's new information and/or statements, and refer to IRM 5.8.7.3, Return Reconsideration.

(5) In all circumstances appearing in (3) above, the taxpayer’s request to have the case reconsidered must have been received by Appeals no more than 30 calendar days after the date Appeals’ rejection letter was issued.

(6) For circumstances not described in (3) above or for reconsideration requests received later than 30 calendar days after the date of the rejection letter, a previously rejected offer may be considered only under the following circumstances:

• At the request of the taxpayer or authorized representative, and

• With the agreement of Collection Appeals Director or Exam Appeals Director, and

• With the agreement of the SBSE Director, Specialty Collection OIC.

(7) A request to reconsider a previously rejected offer identified in (6) will be forwarded to the Appeals Technical Advisor for the Area in which the taxpayer's case was previously assigned. The Appeals Technical Advisor will coordinate the agreement of the Collection Appeals Director or Exam Appeals Director and the SBSE Director, Specialty Collection OIC.

(8) When a previously rejected OIC case is reopened, the ATM should request that the ACAPDATE be reversed using the OSGetServices Ticket process. Use the original Appeals WUNO to monitor the case. Another TC 480 should be input using the original TC 480 date of the offer.

(1) The ACM for a withdrawn offer case should contain the following:

1. Sufficient information indicating the type of withdrawal (voluntary or involuntary) and the date (if known) and manner in which the offer was withdrawn, e.g. verbal, written, certified mail, hand-delivery, etc.

2. The taxpayer's reason for withdrawing the offer, if known.

3. Information on the disposition of any deposits submitted with the offer. The deposit will be refunded unless the taxpayer provided written authorization to apply it to a tax liability.

Note: The Customized OIC Form 5402 may be used in place of an ACM if there is sufficient room to reflect the above items.

(2) The ATE is responsible for inputting the following data on the Customized OIC Form 5402:

• Amount of the outstanding liability

• Amount of the taxpayer's original offer

• Amount of RCP determined by Appeals

(3) Prepare Letter 241, Offer in Compromise Withdrawal Letter, to the taxpayer. Letter 241 can be signed by the ATE. In a withdrawal, there is no need to secure an ATM signature on Form 5402.

(4) When closing a non-CDP offer as withdrawn, prepare and assemble the following:

1. Customized Form 5402 generated from APGolf.

2. ACM, if more details are needed than can fit on the Form 5402.

3. An undated Letter 241(CG) to notify the taxpayer that the offer is withdrawn, the effective date of the withdrawal, and the disposition of any offer deposit.

4. Form 3040 or other written authorization to apply an offer deposit to a tax liability, if applicable.

Note: A Form 1271 is not needed for a withdrawn offer. See IRM 5.8.7.4.3, Closing an Offer as a Withdrawal.

(5) If the case is a DATL offer involving a TFRP or PLET liability, and the ATE recommends an adjustment to the liability, the ATE will prepare a Form 3870. APS will forward the Form 3870, along with any TFRP or PLET administrative file, to the appropriate Collection Advisory Unit.

(6) Once all of the above documents are complete and assembled, the ATE will update the ACDS case status to AC/FR and provide a copy of Form 5402 to the ATM for ACAP entry on ACDS.

(7) See IRM 8.23.4.3.2, Accepted Offer Closing Documents and Appeals Technical Employee Procedures, for instructions on destroying credit reports.