Note:

DCF is only allowed to forward claims for Stop Payment. For all other requests see IRM 3.17.10.5 (19), Reimbursement of Bank Charges Due to Service Loss or Misplacement of Taxpayer Checks.

If the original payment from which the claim arises was made at the area office (i.e., to Revenue Officer, teller function), the claim will be processed by Compliance.

If the original payment from which the claim arises was made at the campus, through a Lockbox or the site of the original payment cannot be determined, the claim will be processed by Campus Accounting Operations personnel as described in these procedures.

If an employee of any functional area discovers in correspondence or during telephonic contact with the taxpayer or his/her representative indication that a bank charge was incurred due to Campus loss or misplacement of a payment and determines that the criterion in (4) above is met, that employee will immediately:

Mail a Form 8546, Claim for Reimbursement of Bank Charges, to the taxpayer or authorized representative with a return envelope addressed to the attention of Accounting Operations with the correct local stop number;

Send the original or copy of the taxpayer correspondence with any attachments pertaining to a claim under Policy Statement 5-39 or a record of the telephone conversation to Accounting Operations; and

Continue working, according to established procedures of his/her functional area, any part of the taxpayer's case which does not pertain to the taxpayer's claim under Policy Statement 5-39.

When it is determined that penalties and interest have been incurred on these lost/misplaced items, take action per IRM 21.5, Account Resolution, at the proper time. When the item involved is an estimated payment, reinput the transaction with the original date.

Upon receipt of documentation described in (5) a above, Accounting will keep a file of this documentation awaiting association with the taxpayer's completed Form 8546. Unassociated documentation will be purged from this file one year after the accrual of the expense as indicated in the documentation or one year after the taxpayer reveals to the Campus that such an expense has accrued, whichever date is earlier.

Upon receipt of the completed Form 8546, associate documentation from the holding file. Some completed Form 8546s may be received without previous contact with the Campus about the claimed bank charge and will, therefore, have no material in the holding file. See Figure 3.17.10-59, Information or Certified Transcript Request for sample completion of Form 8546.

Figure 3.17.10-59

Please click here for the text description of the image.

Evaluate completed Form 8546 and supporting documentation from the holding file. In addition to the points mentioned in (2) above, an allowed claim must:

Result from Campus mishandling of the taxpayer's remittance which may occur through failure to act as well as by taking an incorrect or improper action;

Be based upon the Campus's request for a replacement payment or proof of payment;

Include documentation substantiating the claimed charge and its payment; and

Be signed by the taxpayer or authorized representative.

The taxpayer need not supply information supporting his/her claim if it is already part of the Campus's records. For example,

If the module indicates a notice was sent to the taxpayer, the taxpayer need not submit his/her copy in support of the claim.

If the account module indicates replacement credit, the taxpayer need not submit a copy of the bank draft.

The claim evaluator often must deduce the logical chain of events based on normal prudent behavior and Campus procedures. For example:

Remittances are usually sent to the IRS via first class mail with no return receipt requested. Such a taxpayer whose check is not cashed cannot provide documentation of making the payment; Campus records of the taxpayer's account module may not show the credit. However, stop-payment action by the taxpayer may prove that the taxpayer tried to make the initial payment.

Account discrepancy resolution is often conducted by telephone with Campus personnel suggesting that the taxpayer stop payment on the original remittance and make repayment. This advice is standard Campus practice of which the taxpayer will have no proof. By stopping payment and making the repayment, the taxpayer proves the requirement of (8)b above.

If none of the information provided by the taxpayer or Campus records disqualifies the Form 8546 from consideration, any missing information needed to complete the claim should be requested from the taxpayer or his/her representative. If no TIN is available and the taxpayer is not willing to provide it, deny the claim. Use the telephone whenever possible. While awaiting taxpayer response, the case file is to be kept in the holding file described in (6) above.

If the verbiage on Form 8546 has been altered by the taxpayer in any way, the claim should not be accepted. Follow procedures in (13) below.

If the claim does not meet all of the above criteria, send a brief disallowance letter to the taxpayer indicating the reason for the disallowance, including the name, telephone number and employee ID number of the evaluator. The case file is to be retained in the holding file described in (6) above, but may be segregated with other disallowed cases within that file.

If the claim meets all of the above criteria and is approved for the exact amount shown on Form 8546, then:

Complete FMS Form 197 for each claim. The taxpayer’s TIN must be entered on FMS Form 197 or the IRS/Beckley Office will reject the claim.