CCA 200908041: Transcript supported collection-period extension tied to installment agreement

Plain-English summary

Chief Counsel reviewed account transcripts to decide whether the collection statute expiration date had been extended in connection with an installment agreement. The transcript showed an August 1992 extension less than 60 days before an October 1992 installment-agreement indicator, while an earlier agreement apparently had defaulted. The advice treated the timing and then-current IRS practice as strong circumstantial evidence that the extension was connected to the later agreement. Because the transcript was presumptively correct, the absence of the actual closing agreement did not prevent the IRS from proving its position in court, and a prior Taxpayer Advocate Service memorandum should be withdrawn and revised.

Ruling snapshot

• Question: Did the account transcript support treating the collection period as extended in connection with an installment agreement?
• Outcome: Advice given: yes, the IRS should take the position that the collection period remained validly extended.
• Key authorities: IRC § 6503; the IRS's stated post-RRA98 position on collection-period extensions.

Full text (IRS public release)

ID: CCA_2008112011544551 Number: 200908041
Release Date: 2/20/2009
Office: ----------------------------
UILC: 6503.02-01

From: --------------------
Sent: Thursday, November 20, 2008 11:54:48 AM
To: ----------------
Cc: ----------------------
Subject: Form 900 Memo

-----------------------and I have reviewed the transcripts related to the the CSED issue addressed in the memo we discussed with you previously. The transcript clearly reflects a CSED extension on August 18, 1992. This is less than 60 days before the indicator of an installment agreement on October 19, 1992. While we recognize that there also is an indicator for an installment agreement on June 22, 1992, we assume that was an installment agreement that defaulted - and it would seem to us to be completely logical that the IRS would demand an extension of the CSED after a default. As was previously discussed with you, the practice of the IRS at the time of obtaining extensions in this type of situation (as reflected in the transcript) would be strong circumstantial evidence of the requirement for the CSED extension "in connection" with the installment agreement. Given the closeness in time (and the fact that the CSED extension preceded the installment agreement), the proper conclusion is that the CSED extension was "in connection" with the installment agreement, thereby making the CSED still valid. The absence of the actual closing agreement is not an impediment to making this showing in court because the transcript is presumptively correct. Consistent with our position on the validity of CSED extensions after RRA98, the IRS should take the position that the CSED was extended. The memo to ------------------ at the Taxpayer Advocate Service should be withdrawn and revised to reflect that conclusion.

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