To Simplify the Procedures in Writing-Off Cases Involving P5,000.00 and Below as Prescribed in RMO 35-95

September 23, 1996 REVENUE MEMORANDUM ORDER NO. 26-96 SUBJECT : To Simplify the Procedures in Writing-Off Cases Involving P5,000.00 and Below as Prescribed in RMO 3 5-9 5 TO : All Regional Directors Revenue District Officers and Others Concerned I. OBJECTIVES: To reduce the Accounts Receivable to a more manageable and realistic level, there is an urgent and compelling need to cancel all Accounts Receivable involving the amount of P5,000.00 and below by simplifying the procedure on write-off provided for under RMO 35-95. Based on the analysis of the result of the implementation of RMO 11-95 it was disclosed that there are 69,775 of these cases as of December 13, 1995. Since this is part of the Bureau of Internal Revenue tax Computerization Program, it is very important that this activity should be completed by the end of December 31, 1996. II. GUIDELINES AND PROCEDURES The following policy guidelines and procedures are hereby prescribed to reduce the over-all inventory of receivable accounts of the Bureau. These are in addition to the policies promulgated in RMO 35-95: 1. It shall be the policy of the Bureau to automatically cancel all uncollected accounts as of this date involving the amount of P5,000.00 and below for reasons stated in paragraph II (1 to 9) of RMO 35-95. A simplified format (see Attached Memorandum Report Form) shall be used to support the issuance of the ATCA instead of the Fieldman's Affidavit of Uncollected Taxes required in said RMO. 2. All memoranda recommending the cancellation of an account shall be duly signed by the Revenue District Officer (RDO) or in his absence by the Assistant Revenue District Officer (ARDO), reviewed by the members of the Revenue Regional Approval Committee and finally approved by the Regional Director 3. The Authority to Cancel Assessment (ATCA) shall be correspondingly prepared by the RDO or the ARDO, to be signed by him/her as the recommending officer and the Regional Director as the approving Official. This is to facilitate closure of the account and is an exception to paragraph G-1 of RMO 37-94 dated March 25, 1994 designating the Revenue Officials authorized to issue and approve ATCA's. 4. In cases where the account involving the said amount does not fall under the uncollectible cases enumerated in RMO 35-95, the Regional Director is required to make a last ditch effort to collect the tax liability thru compromise settlement by foregoing the penalties and demand only the basic tax due. The Regional director may also accept a lower amount of payment if in his judgment the taxpayer is really unable to pay the basic tax due. If the taxpayer cannot really pay any amount and does not have any leviable property/ies, the Regional Director is authorized to totally cancel the account after accomplishing the memorandum report. 5. All accounts close under this order shall be listed in BIR Forms Nos. 1247 and 1248 and submitted to the following offices: Original Collection Programs Division Duplicate Collection Division of the Region Triplicate RDO File III. MODIFICATION CLAUSE: This order modifies the provisions of RMO 35-95 and shall be in effect until December 31, 1996. IV. EFFECTIVITY CLAUSE This order shall take effect upon approval thereof. LIWAYWAY VINZONS CHATO Commissioner MEMORANDUM REPORT ___________ Date MEMORANDUM FOR: The Revenue Regional Director This refers to the tax liability/ies of Mr. ____________________ with postal/business address ________________________________________ as follows: TYPE OF TAX ASSESSMENT NO. AMOUNT ___________ _______________ _____________ ___________ _______________ _____________ ___________ _______________ _____________ The above-mentioned assessment has/have been analyzed and determined to be uncollected under the provisions of RMO 35-95. (State the applicable reason/s to _____________________________________________________ this case/s as enumerated in _____________________________________________________ RMO 35-95 # II, 1-9) _____________________________________________________ In view thereof, the undersigned recommends the cancellation of the aforestated assessment in accordance with the provisions of RMO ________. If this meets your approval, hereto attached is a prepared ATCA for your signature. ___________________ Revenue District Officer RECOMMENDING APPROVAL: _____________________________ _____________________________ Asst. Regional Director Chief, Assessment Division ____________________________ _____________________________ Chief, Legal Division Chief, Collection Division APPROVED: ____________________ Regional Director