The Collection Appeals Program: Fast Review of Liens, Levies and Payment Plans

The Collection Appeals Program, or CAP, lets you take a collection decision to IRS Appeals quickly. It covers more actions than a Collection Due Process hearing and moves in days instead of months. It also ends with a decision you generally cannot take to court.

That combination is why it deserves careful use. Here is how it works.

What CAP covers

IRM 8.24.1.3 lists the actions you can appeal under CAP. They include:

• Levies and seizures, before or after they happen.
• The filing of a Notice of Federal Tax Lien, including liens against property held by an alter ego or nominee.
• Denial of lien certificates, such as requests for subordination or discharge.
• Rejection, modification, or termination of an installment agreement.
• Disallowed requests for return of levied property and wrongful levy claims.

The IRS explains the program in Publication 1660, Collection Appeal Rights, and the request form is Form 9423, Collection Appeal Request.

Step one: the manager conference

For lien, levy, and seizure actions, you generally must talk to the collection employee's manager before filing a CAP appeal (IRM 8.24.1.3). This is not a formality. Managers sometimes fix the problem on the spot, especially when a revenue officer moved faster than the file supports.

Installment agreement disputes are different. Because the right to appeal an installment agreement rejection or termination is statutory, the manager conference is not required for those (IRM 8.24.1.3.5).

The deadlines are measured in business days

This is where people lose CAP rights. Under IRM 8.24.1.3.5:

• After the manager conference, you must tell Collection within two business days that you intend to file Form 9423.
• Form 9423 must be received or postmarked within three business days of the conference. Otherwise, Collection may resume action.
• If the manager does not contact you within two business days of your conference request, Form 9423 is due within four business days of that request.
• For a seizure, you have 10 business days after receiving the Notice of Seizure to appeal to the Collection manager.

Installment agreement appeals run on a 30-day clock under IRM 8.24.1.3.4. You have 30 days to appeal a rejection (tied to IRC 7122(e)), 30 days from a proposed modification or termination, and 30 days after a termination date.

Does collection stop?

Generally, yes, for the action being appealed. IRM 8.24.1.3 says that by policy lien, levy, and seizure enforcement is suspended while the CAP case is in Appeals, unless withholding action would put collection at risk, such as when assets are being dissipated. For installment agreement rejections and terminations, the protection is statutory: no levy during the 30 days after rejection or while a timely appeal is pending.

How fast Appeals decides

CAP is built for speed. The IRM sets a goal of about five business days from assignment to the Appeals employee, with more complex matters such as lien withdrawals, installment agreements, and seizures normally resolved within 15 business days (IRM 8.24.1.3). A conference is supposed to be held within two business days of receiving the case.

That pace means you need your documents ready when you file. Financial statements, proof of payments, the lien or levy notice, and a short written explanation of what you want and why.

CAP versus CDP

This is the most important strategic choice in collection appeals.

• Tax Court review. A Collection Due Process hearing ends in a Notice of Determination you can petition to the U.S. Tax Court under IRC 6330(d)(1). A CAP decision is final and binding on you and Collection (IRM 8.24.1.2), and the Tax Court has no CDP jurisdiction over it.
• Issues you can raise. CDP allows challenges to the underlying liability in some circumstances under IRC 6330(c)(2)(B). CAP does not consider the underlying liability.
• Statute effects. A timely CDP request suspends the collection statute under IRC 6330(e). That is not a reason to avoid CDP, but it is part of the calculation.
• Availability. CDP is available only at specific points: after the first lien filing notice or the first pre-levy notice for a tax period, within 30 days. CAP is available throughout the collection process.

Here's the part most people miss: if you are still inside a CDP window, CAP is usually the wrong first move. You would be trading judicial review for speed. Check whether you have received Letter 3172, Letter 1058, or LT11, and whether the 30 days have run. If they have, CAP may be the best remaining option. If you missed the CDP deadline by less than a year, an equivalent hearing is another route.

When CAP is the right tool

• A revenue officer has rejected a reasonable installment agreement.
• A levy is about to hit an account you need to operate a business, and your CDP window has closed.
• A lien discharge or subordination request was denied and a closing is scheduled.
• A seizure has been proposed and you have a credible alternative.

In each of these, speed matters more than a trip to Tax Court. CAP delivers speed.

Building a CAP submission that works in five days

An Appeals employee deciding a case in a week does not have time to dig. Hand them a complete package:

• Form 9423, completed and signed, identifying the specific action you are appealing.
• A one-page explanation of why the action is wrong or what alternative you propose. Be concrete: "Release the levy on the operating account; we will pay $X per month beginning on a stated date."
• Financial information if your proposal depends on ability to pay, usually a current Form 433-A or 433-F with supporting statements.
• Proof of compliance. Current-year estimated payments, deposits, and filed returns. Appeals is unlikely to stop collection for a taxpayer who is still falling behind.
• The notice or letter that triggered the appeal.

If the dispute is over a payment plan, it helps to understand the installment agreement types before you argue about one. The firm's overview of IRS installment agreements covers the basics.

Representation

You may appeal through an authorized representative. Under IRM 8.24.1.3.5, a copy of Form 2848 is needed if the power of attorney is not already on IRS systems, and Form 9423 must be signed by you or your authorized representative.

Let's talk

CAP deadlines are counted in business days, and the decision is final. If a collection employee has just told you no, call (813) 229-7100 today. Let's talk about whether CAP, CDP, or something else is the right move.