Revision of the Procedures for the Preparation and Application of the Authority to Change Assessment (ATCA) and its corresponding BIR Forms (BIR Forms Nos. 17.58 and 18.12)

May 31, 1965 REVENUE MEMORANDUM ORDER NO. 22-65 SUBJECT : Revision of the Procedures for the Preparation and Application of the Authority to Change Assessment (ATCA) and its Corresponding BIR Forms (BIR Forms Nos. 17.58 and 18.12) I Purpose This Order is issued to set up uniform and more effective procedures in making changes in the amount of taxes, surcharges, compromises, penalties, etc., already assessed and/or demanded and/or changes in the due dates of payments on all kinds of taxes and also to prescribe the official form to be used therefor by all units concerned. cdtech II Procedures A. Application of Authority to Change Assessment : The old BIR Form No. 17.58 and BIR Form No. 18.12, both known as the Authority to Change Assessment (ATCA), or any other form used in making changes in the amount and/or due dates of payments of tax cases formally demanded from taxpayers shall be replaced by the revised authority to Change Assessment form, BIR Form No. 17.58 (revised), a copy of which is attached hereto. Pending, however, the printing of the new prescribed form, the old forms may still be used by all units concerned: The following are the instances where Authority to Change Assessment shall be used and issued: 1. Where, as a result of an investigation, reinvestigation or review of a tax case, there is either a decrease, increase, or a total cancellation of the amount of tax due including penalties, or a change is made in the due dates of payments; 2. Where court decisions on tax cases resulted in either a decrease, increase, or a total cancellation of the amount of tax including penalties involved, or a change in the due dates of payments; 3. Where tax cases have prescribed and the government has lost its right to collect the amount assessed and/or demanded, and upon recommendation and approval by proper officials, the corresponding tax liabilities thereof should, therefore, be dropped from the Bureaus records; 4. Where after exhausting all summary remedies in the collection of tax accounts, an account cannot be collected by reason of any of the following instances: (a) death of taxpayer with no property left; (b) insolvency and/or bankruptcy; or (c) whereabouts of taxpayer is unknown and he has no known property or has not posted any guaranty or bond, and an affidavit is executed and accepted by proper officials, pursuant to the provisions of Revenue Memorandum Order No. 1-65 in relation to Office Circular No. V-71 In the case of a taxpayer who cannot be located [letter (c) above], the information, together with the affidavit, shall be forwarded to the National Office where the Tax Accounts Division shall consult its records to insure that the taxpayer's whereabouts cannot really be determined; 5. Where the amount realized from sale of property distrained or levied is not sufficient to cover the tax liability and the cancellation of the balance thereof has been approved by proper officials due to the taxpayer's insolvency or bankruptcy; or 6. Where there is no acceptable buyer and the property distrained or levied is forfeited to the government or where the government decides to use the property, and the value of such property as determined by proper officials is sufficient to cover the tax liability or the value of such property is insufficient and the taxpayer is insolvent or bankrupt and the cancellation of the liability has been approved by proper officials. The Authority to Change Assessment shall not be issued to reflect any change in the amounts of withholding taxes on salaries and wages. Instead, another form (Assessment Adjustment sheet, copy attached) shall be used to reflect the increase, decrease or cancellation of the taxes due from taxpayers. B. Preparation and Submittal of Forms : In the National Office, it shall be the duty of the Revenue Operations Head (Assessment) and the Revenue Operations Head (Specific Tax) to prepare the Authority to Change Assessment for all kinds of taxes falling under their respective jurisdictions for changes in the amounts assessed and/or demanded or in the due dates of payments made therein. In this connection, the division or unit in charge of the tax case shall, upon approval of the recommendation for the change or upon receipt of the court decision, return or course the tax docket to the Revenue Operations Head (Assessment or Specific Tax, as the case may be) for the preparation of the authority to Change Assessment. The above-stated responsibility for the preparation of the authority to Change Assessment may, however, be delegated by the Revenue Operations Head concerned to any division or unit under him provided the centralized control and safeguard for the issuance of the Authority to Change Assessment is maintained. In the regional district, it shall be the duty of the Chief, Income and Business Tax Branch to prepare the Authority to Change Assessment for changes in the amounts assessed and or demanded or the due dates of payments made therein. In this connection, the branch or unit in charge of the tax case shall, upon approval of the recommendation for the change or upon receipt of the court decision, return or course the tax docket to the Income and Business Tax Branch for the preparation of the Authority to Change Assessment. Authority to Change Assessment whether prepared in the National Office or in the Regional District, shall be in quadruplicate, to be distributed as follows: Original to Data Processing Center Duplicate to Tax Accounts Division Triplicate attach to the docket of the case Quadruplicate file copy of the preparing unit. The Assessment Department and the Specific Tax Department or the unit delegated to do so shall prepare a list of all approved Authority to Change Assessment issued respectively by them during a particular month. The approved Authority to Change Assessment shall be listed and arranged in numerical sequence and the original copies thereof shall be attached to the said list and submitted to the Data Processing Center not later than the fifth day after the end of such month. The Income and Business Tax Branch shall prepare a list of all approved Authority to Change Assessments issued in the regional office during a particular month. The approved Authority to Change Assessments shall be arranged in numerical sequence in the list. The original of the Authority to Change Assessments shall be attached to the said list and submitted to the Data Processing Center not later than the fifth day after the end of such month. The Data Processing Center, after processing the Authority to Change Assessments shall transmit them together with the listings and/or reports generated therefrom to the Tax Accounts Division. The Tax Accounts Division, upon receipt of the lists with the attached original copies of the Authority to Change Assessments, shall check the same for completeness. Any discrepancy or error noticed by the Tax Accounts Division shall be immediately communicated to the principal units making use of the IBM lists for collection or clearance purposes, furnishing a copy thereof to the Data Processing Center, for entering the necessary correction into their copies of the lists. C. Accomplishment of the Form : The following shall serve as guide in filling up the Authority to Change Assessment form: 1. Taxpayer's Record Number State the taxpayers record number, if one has already been assigned. 2. Name of Taxpayer State the full name of the individual or the full business name of the partnership or corporation. 3. Address Taxpayer's address as appearing in the return or docket. 4. Kind of Tax State the kind of the tax involved, i.e., income, business, transfer, specific, etc. 5. Assessment/Demand Number The assessment number of the income tax return or the demand number of a tax case should be indicated in this space. 6. Column marked "FROM" and column marked "TO" The data or figures to be entered in column marked "FROM" should represent the assessment prior to change. The new assessment shall be entered under column marked "TO". The due date is the deadline set by the Bureau for paying the amount due without incurring further penalties. If the due date is changed, the old date shall be written under the column marked "FROM" and the new date under the column marked "TO". The basic tax, surcharge, compromise and other penalties shall be indicated separately as required in the form. 7. Amount already paid, if any If payment has been made previously, such payment with the corresponding Official Receipt number and date thereof must be indicated here. 8. Amount Collectible/Refundable This figure refers to the amount still collectible from or refundable to the taxpayer, if any. 9. Reason for Change State briefly but clearly the reason for the change of assessment, demand and/or due date. Use the back of this form for continuation of the statement or for additional information. III ATCA Record Control Book and Reporting All units of organization responsible for the preparation of the Authority to Change Assessment shall keep a register book for all Authority to Change Assessments prepared by them. This Record Control Book shall contain, among others, the following data: (a) ATCA number (b) Date Issued (c) Name of Taxpayer (d) Taxpayer's Record Number (e) Assessment or Demand Number (f) Previous Assessment/Demand and/or Due Date. (g) New Assessment/Demand and/or Due Date (h) Remarks All approved Authority to Change Assessments and cancelled ATCA forms shall be entered in the Record Control Book in numerical sequence. This book shall, upon request or demand, be made available for inspection or examination by any authorized official. All units of organization responsible for the preparation of Authority to Change Assessments shall include in their monthly report an accounting of all Authority to Change Assessment forms in their possession in the same manner as the official receipts are being reported and accounted for. This shall form part of the monthly listings of all Authority to Change Assessments prepared by units concerned. IV Repealing and Effectivity Clause This Order supersedes or repeals all existing orders or provisions thereof inconsistent herewith. lexlib This Order takes effect on July 1, 1965. (SGD.) BENJAMIN N. TABIOS Acting Commissioner of Internal Revenue