IRS Forms 433-A, 433-B, and 433-F – An Overview
The IRS has three information collection statement forms namely IRS Form 433A, IRS Form 433B, and IRS Form 433F. Their basic function is to relay to the IRS your financial assortments in a structure of the IRS’s choosing. That way the IRS is able to determine how much you owe them (on a month-to-month basis). This, therefore, means that if you have any tax issue then you probably need to take a look at your IRS Forms 433A, 433B or 433F where relevant.
However, these three IRS Forms are quite different to a certain extent. You need to understand which form is relevant to your case to clear any possible misunderstandings, which often lead to costly tax obligations. It is critical that you understand this important documents of the tax system to ensure you have an idea of what the IRS expects of you. As you know ignorance in tax matters can be expensive. So here is a simple elaboration of the difference between these three IRS Forms to help you avoid any costly misunderstandings.
In summary, the IRS Forms 433A, 433B, and 433F are different in the following way;
- IRS Form 433A- is a tax collection information statement for self-employed personnel and those that earn wages.
- IRS Form 433B- is a tax collection information statement for businesses.
- IRS Form 433F- is a generalized tax collection information statement.
Now that you have an idea of what makes these three forms different for you as a taxpayer, can you differentiate them in case you came across at least one? Well, worry not, for the following part of this article will help you do this with ease.
The IRS Form 433-A
The IRS Form 433A is also referred to as the “Collection Information Statement for Wage Earners and Self-Employed Individuals.” This form is used by individuals within the above-mentioned categories in instances where the wage earner or self-employed individual cannot pay their owed Federal Income Tax in full. By filling and filing the IRS Form 433A to the IRS, you give them the financial information pertaining to your current financial situation as the taxpayer.
To complete this particular form, you are required to go through the following sections. Four of the sections stipulated below must be completed:
- Section 1, Personal Information- which entails an individual’s personal information such as their social security number, driver’s license number, date of birth among other things that would help the IRS contact and identify you.
- Section 2, Employment Information- which basically requires your employment information to help the IRS assess your current household income.
- Section 3, Other Financial Information- any other financial information such as impending lawsuits, trust funds or even insurance policies, which would be utile in helping the IRS know if you have any sources of assets or future income that would be used in paying your outstanding tax debt.
- Section 4, Personal Assets Information for all Individuals- this section entails information submitted to the IRS on any personal assets such as vehicles, bank accounts, real estate and so on. In this section documents such as paycheck stubs, bank statements, credit card statements, monthly living expenses documented and such as documentation is to be attached.
- Section 5 & 6, Business and Sole Proprietorship Information- this section is meant for the self-employed category of individuals. Here, information such as business assets and gross monthly business income or expenses are to be submitted.
The IRS Form 433B
This IRS Form 433B is a Collection Information Statement used for businesses that owe Federal taxes and cannot pay them as soon as they should. This allows the business to temporarily delay, get a compromise, or pay their due taxes in installments based on whatever challenges the business is facing at that particular point. To fill out the IRS Form 433B, information pertaining to the business’s financial situation that would be used by the IRS is needed to establish the business’s ability to fully pay its taxes.
To complete this form you are required to fill out the following five sections with the relevant information:
- Section 1, Business Information- this section requires you to fill in the primary information on the business. That includes; contact information, date of establishment, type of business, number of employees and even internet sales.
- Section 2, Business Personnel and Contacts- here, you are required to provide information on key individuals within the business. Individuals such as partners, board members or major shareholders. In providing this, personal information such as their telephone and social security numbers among others are to be submitted.
- Section 3, Other Financial Information- in this section any other financial data such as impending lawsuits, debts owed or even bankruptcy proceedings just to name a few are required by the IRS.
- Section 4, Business Asset and Liability Information- here, information on the business’s bank accounts, available credit, total cash in banks, vehicles among other assets and liabilities are to be submitted.
- Section 5, Monthly Income/ Expenses Statement for Business- in this section you are required to provide information on the business’s total monthly income and expenses during the period in which the IRS is to be allowed a payment plan, compromise or temporary delay by the IRS.
The IRS Form 433F
This IRS Form 433F is a Collection Information Statement used by the IRS to collect financial information on individuals with Federal tax debts. This information is used by the IRS in determining eligibility for payment plans or state of being non-collectable. The 433F form is usually used to apply for non-collectable status or payment plan for an owed tax debt.
In its structure, this form entails the following section;
- Top section- this section requires your personal information, which includes your contact information, social security number and even business name and number of employees if you own a business.
- Section A, Accounts/Lines of Credit- financial information such as bank accounts, lines of credit, mutual funds and so on are shared in this section where relevant.
- Section B, Real Estate- here, you are to provide a catalog of properties owned, such as primary residences, rentals, and vacation homes just to name a few examples.
- Section C, Other Assets- if you own any other assets such as cars, boats, and the likes, this is the section where you provide details about them.
- Section D, Credit Cards- list how many credit cards you own and how much you owe.
- Section E, Business Information- this section is meant for business owners where you are to provide details on business credit cards, bank accounts among other relevant information.
- Section F, Employment Information- in this section you are to share information on your employer if you have one.
- Section G, Non-Wage Household Income- if you have any other additional income sources such as alimony or child support, then this is the section is where you share that information.
- Section H, Monthly Necessary Living Expenses- this is the final part in which information on your monthly spending is shared. Here, your rent, amount spent on food, utility bills and so on becomes relevant.
The Difference Between the Forms
For these three forms, the difference is that the IRS Forms 433A and 433B are both six pages while the IRS Form 433F is two pages long. Also, the IRS Form 433A is for self-employed or wage earners while the IRS Form 433B is for businesses and the IRS Form 433F makes work easier since it includes both. Hopefully, now you can differentiate one form from the other based on the sections as clarified within this article.
Contact an Attorney
If you want to set up an Installment Agreement or submit an Offer in Compromise your best bet is to contact a tax attorney to help you do so. The attorneys at Ayar Law are trained and experienced in such matters. If you need FREE, No-obligation, legal advice, call Ayar Law today at 248.262.3400.