P3-U09 · PART 3 · SOURCE CYCLE 2026-2027
Tax Payments and IRS Collections
How to complete this unit
This unit uses 27 source-gated recall cards and 28 admissible practice questions. Complete the sequence in order; the unreleased wiki prose remains outside the learner path.
- 1 · LearnBuild the rule
Answer each recall prompt before opening it. Then learn the exact rule, test the controlling facts through four quick challenges, explore common questions, and finish with one own-words teach-back.
- 2 · ApplyUse it in context
Complete at least 20 mapped questions over two sessions. Review the explanation even when the answer is correct.
- 3 · ProveTest readiness
Use the Part 3 mock under time pressure. Return here for every flagged or missed concept before the next attempt.
Verified recall questions
Only cards whose complete question and answer were checked against exact primary-authority evidence appear here. Stable unit ownership gathers this lesson across 1 textbook collection.
Q1.Absent an event that suspends or extends the period, how long is the IRS collection statute generally?
10 years. Publication 594 describes the collection statute expiration period as generally 10 years.
Q2.Tax was assessed on September 8, 2026, and no tolling event occurs. What is the general collection expiration date?
September 8, 2036. Applying Publication 594's general 10-year collection period gives September 8, 2036.
Q3.How should a practitioner handle taxpayer's ability to pay the tax (e.g., installment agreements, offer in compromise, currently not collectible)?
Collection alternatives depend on the taxpayer's ability to pay and verified financial information.
Q4.What is the exam-ready rule on general financial health (e.g., bankruptcy, lawsuits, garnishments, cash flow, assets, and insolvency)?
Collection analysis considers income, expenses, assets, equity, and other financial facts rather than one balance alone.
Q5.What official rule governs third-party research (e.g., property assessment for taxes, asset values, state and local tax information)?
Reliable third-party records can help substantiate ownership, values, income, and expenses in a collection matter.
Q6.Summarize the correct treatment of discharge of the tax liability in bankruptcy.
Bankruptcy can affect collection, but tax discharge depends on bankruptcy and tax-law requirements and is not automatic.
Q7.What common mistake should be avoided with the IRS Collection Financial Standards?
The IRS uses Collection Financial Standards when evaluating certain allowable living expenses and ability to pay.
Q8.State the controlling rule for extension of time to pay (e.g., Form 1127).
An extension of time to pay is distinct from an installment agreement and requires the applicable form and hardship showing.
Q9.Give the practical federal-tax rule for offer in compromise.
An offer in compromise may be based on doubt as to liability, doubt as to collectibility, or effective tax administration under applicable rules.
Q10.What is the key limitation involving collection appeals program (e.g., denial of installment agreements, discharge applications)?
CAP provides administrative review for specified collection actions, but does not provide Tax Court review of the CAP decision.
Q11.How should a practitioner handle collection appeals and due process (e.g., lien, levy, and Form 12153)?
A timely Collection Due Process request can secure an Appeals hearing concerning a qualifying lien or proposed levy and may permit later Tax Court review.
Q12.What is the exam-ready rule on adjustments to the taxpayer’s account (e.g., abatements and refund offsets)?
The IRS may apply an overpayment to certain outstanding liabilities; account adjustments and offsets must be analyzed separately.
Q13.What common mistake should be avoided with collection notice and Notice of Federal Tax Lien?
A Notice of Federal Tax Lien publicly alerts creditors to the government's legal claim against a taxpayer's property after the lien arises.
Q14.What threshold rule applies to levy and seizure of taxpayer's property?
A levy is a legal seizure of property or rights to property after required collection procedures and notices.
Q15.How does current authority treat currently Not Collectible (e.g., reasons and reactivation)?
Currently-not-collectible status generally pauses active collection when payment would cause hardship, but the debt, interest, and possible liens remain.
Q16.What should a representative verify about the IRS Collection Summons (e.g., purposes)?
An IRS summons can compel testimony or production of records relevant to determining or collecting tax.
Q17.Axel is married to Emma; they live together and file joint returns. In which scenario would Axel qualify as an injured spouse?
Axel files a joint return, and his share of the refund is offset due to Emma's student loan debt.
Q18.All of the following property is exempt from an IRS levy except:
Social Security payments.
Q19.Waylen owes $40,000 in delinquent tax debt. He applies for an offer in compromise, but it is rejected. How much time does Waylen have to appeal his rejected offer?
30 days
Q20.Aziza owes $20,000 of unpaid federal tax liabilities. She agrees she owes the tax, but she has a serious medical problem, and her monthly income does not meet her necessary living expenses. She does not own any real estate and does not have the ability to fully pay the liability now or through monthly installment payments. What type of offer in compromise may she qualify for?
Doubt as to collectibility.
Q21.Jack's only income comes from wages. He has a high-paying job as a medical doctor, but did not properly estimate his withholding for several years. As a result, he currently owes $255,000 to the IRS. He would like to set up an installment agreement. Which of the following statements regarding his payment options is correct?
Jack may qualify for an installment agreement for this amount of unpaid tax.
Q22."Separation of liability" relief does not apply to taxpayers who are:
Single (never married).
Q23.Farida is an enrolled agent. She prepared a tax return for her client, Josue. Josue has a balance due of $25,900, but he cannot pay the entire amount upon filing and would like to set up an installment agreement. Which of the following is required before an installment agreement will be approved?
Josue must be in filing compliance.
Q24.Sheila and Dale were married in 2025. They are owed a refund on their joint return, but the refund is offset against Dale's past-due child support. Does Sheila have any recourse to recover her portion of the refund?
Sheila may be eligible for injured spouse relief.
Q25.Rosalyn is receiving a $4,500 federal tax refund this year. Which of the following methods is not available for her to receive her refund?
She may direct deposit her refund to her credit card account.
Q26.Jason cannot pay his tax liability because of a serious health issue that is causing significant hardship. How much extra time will the IRS grant for Jason to pay his tax liability under the undue hardship extension?
6 months.
Q27.Penalties and interest continue to accrue on a taxpayer's unpaid tax liability in which of the following instances?
All of the above.
Ready to move on?
- ▸ Explain at least 80% of these 27 rules without opening the answer, twice on different days.
- ▸ Score 80% across 20 or more mapped questions over two sessions, not one memorized round.
- ▸ Complete a timed Part 3 mock and return to this unit if its concepts remain flagged or missed.
Use these checks to choose your next study action. They do not predict a PSI scaled score.