Ezel / IRS Rulings / 200908036

CCA 200908036: Agency could direct a known bank to stop payment on a check

Number
200908036
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Procedure
Topics
Procedure, penalties, and administration
Code sections
§ 6861
Ruling dated
November 17, 2008
Publicly released
February 20, 2009
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2009, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2009
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel addressed how to stop payment on a check being held by a known bank. The email said a cited two-week period appeared to be the time needed for the Financial Management Service to make a stop-payment order effective nationwide. Because the particular bank was already known, the advice said the agency only needed to notify that bank. The writer understood that the agency providing the funds, as an issuer of the check, could send a narrowly directed stop-payment order without relying only on the Financial Management Service.

Ruling snapshot

  • Question: Did the agency need a nationwide stop-payment process when it knew which bank held the check?
  • Outcome: Advice given: no, it could notify the single bank directly.
  • Key authorities: UILC 6861.03-00; no statute or regulation was cited in the released email.

Full text (IRS public release)

ID: CCA_2008111715225634 Number: 200908036
Release Date: 2/20/2009
Office: ----------------------------
UILC: 6861.03-00

From: -----------------------
Sent: Monday, November 17, 2008 3:22:57 PM
To: --------------------
Cc: -------------------------------------------
Subject: Check held by bank

--------

You mentioned that a stop payment order would take two weeks to become effective. I think that time frame refers to how long it takes to make it effective through FMS, so that the stop payment order goes out nationwide.

In your circumstance, you already know which bank is holding the check. Thus, all you need to do is to notify that one bank to stop payment.

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--------------------- It is my understanding that the issuer of the check, not only FMS but including the agency which provided the funds, can issue a narrowly directed stop payment order to a single bank.

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