CP546: Special backup withholding listing for a successor payer

What CP546 is

A list of every payee currently subject to C-program withholding under a predecessor payer, requested on Form 4442 when one payer takes over another and the old records are unavailable (IRM 5.19.3.5.2.16). It does not exist for B-Notice status, because the IRS keeps no record of which payers received CP2100s.

The deadline

None; it is a request you make.

What to do

Supply both payers' names, addresses and TINs; the IRS confirms the predecessor's filing requirements are closed. Use the listing only for withholding compliance; disclosure beyond that is actionable under IRC 7431.

Why successor payers ask for it

When one payer acquires another, or a bank acquires a book of deposit accounts, the obligations under IRC 3406 travel with the accounts but the records often do not. The successor needs to know which payees were already subject to backup withholding and why. For the B-Notice track there is no IRS record to request: the IRS does not keep track of which CP2100 lines a payer acted on or which payees received a first or second B-Notice, so the predecessor's own log is the only source and the successor should insist on receiving it in the deal. For the C-program the IRS does hold the list, because it imposed the withholding itself, and the CP546 is that list produced on request.

Making the request and using the listing

The request goes through the IRS on a Form 4442 referral and must identify both payers by name, address and TIN. Before producing the listing the IRS confirms that the predecessor's filing requirements have been closed, so the request cannot be used to peek at an active competitor's accounts. The listing is return information: it may be used only to comply with the withholding obligation on the acquired accounts, and disclosure beyond that purpose is actionable by the payees under IRC 7431. Load the payees onto the acquired accounts as C-program withholding, continue withholding until the IRS releases each one, and keep the CP546 with the acquisition file. The C-Notice guide covers how release works.

Questions about CP546

Have a different notice? The IRS notice decoder lists all 77 in the order they tend to arrive.