CCA 201313022: IRS explains the 90-day rule for certain pre-1999 collection extensions

Plain-English summary

The IRS explained that, for certain collection statute expiration date extensions obtained before December 31, 1999, the extension expires no later than the 90th day after the extension period ends. The memo clarified that a prior memo did not limit this 90-day rule to installment agreements that defaulted and were later reinstated. It also stated that a Form 900 waiver must have been executed when the original, valid installment agreement was entered into, not merely when a defaulted agreement was reinstated. The author declined to determine the collection period for the specific case because the facts and records were incomplete.

Ruling snapshot

• Question: When does the 90-day addition apply to collection statute extensions associated with installment agreements?
• Outcome: Advice given on the general rule, without deciding the specific taxpayer's collection statute expiration date.
• Key authorities: IRC § 6502; RRA 1998 § 3461(c)(2); Form 900

Full text (IRS public release)

1

ID: CCA-312123-12 Number: 201313022
Release Date: 3/29/2013
Office:
UILC: 6502.00-00

From: -----------------------
Sent: Monday, March 12, 2012 9:36 AM
To: ---------------------
Cc:
Subject: ------------------------------------------------

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We understand there to be some confusion about application of RRA 3461(c)(2), which provides that in cases of extensions of the CSED obtained before December 31, 1999, that extension expires at the very latest on the 90th day after the end of the period of such extension.

The January 5, 2011 memo referenced discusses section 3461(c)(2) in passing, but the underlying conclusion of the memo is that a waiver of the CSED executed at the time of reinstatement of a defaulted IA is not valid. Rather, the waiver must be entered into in connection with the original IA (at the same time that IA was entered into).

The memo was misinterpreted by someone to mean that the 90-day rule only applies in cases of IAs that are defaulted and then reinstated. The memo was not concluding that the 90-day addition to the period only applies under these facts. Rather, it was just stating what the provision provides with respect to CSED waivers executed in connection with IAs prior to December 31, 1999. I understand this to be what you mean by asking whether the 90-day rule applies independently of the reinstated IA issue addressed in the memo.

There may in fact be an issue of whether there actually was a Form 900 waiver executed in connection with an IA pre-December 31, 1999, in the specific case you are discussing, and I don't know whether there is or is not in this particular case. I saw a copy of the Form 900, and it does not in itself indicate it was executed with an IA. Nor am I at all familiar with the TCs and definer codes discussed below. But my response to the general question you are asking: regarding creating a CSED calculator that accounts for waivers of the CSED executed in connection with IAs, then 90 days will always be added to that period as a general rule. Again, this applies only to waivers executed at the time of execution of original, valid IAs. I am not attempting to address what the CSED is for the specific case you are discussing with the RO.

Please let me know if I can be of further assistance.