What Financials the IRS Wants: Using Forms 433-A, 433-B, and 433-F

What financial information do Forms 433-A, 433-B, and 433-F require?

These three IRS collection forms are the primary way the agency documents a taxpayer’s ability to pay. They look similar in purpose but differ in scope and detail:

• Form 433-A (Collection Information Statement for Individuals) — for wage-earners and other individuals, including household living expenses, asset schedules, liabilities, and income sources. (IRS form 433-A, current instructions: https://www.irs.gov/pub/irs-pdf/f433a.pdf)
• Form 433-B (Collection Information Statement for Businesses) — for partnerships, corporations, and other entities; includes business balance sheet items, receivables, accounts payable, payroll, and owner compensation. (IRS form 433-B: https://www.irs.gov/pub/irs-pdf/f433b.pdf)
• Form 433-F (Collection Information Statement) — a shorter statement used for simpler cases (sole proprietors or individuals with straightforward finances) or when the IRS requests a quicker snapshot. (IRS form 433-F: https://www.irs.gov/pub/irs-pdf/f433f.pdf)

Below I lay out the practical elements the IRS expects, how the agency uses the information, common preparation mistakes, and step-by-step guidance for completing and submitting these forms.

What the IRS expects to see (income, expenses, assets, liabilities, supporting docs)

1. Income

• All sources: wages, self-employment income, rental, interest/dividends, Social Security, unemployment, alimony (if applicable), and irregular income such as bonuses. Provide year-to-date and recent pay stubs or profit-and-loss statements for self-employed income.
• For businesses, include gross receipts, cost of goods sold, and owner draws or guaranteed payments.

1. Monthly and allowable living expenses

• The IRS uses national and local standards for many categories (groceries, utilities, transportation) but also reviews actual expenses for items outside the standards (medical, childcare, education). Document recurring, necessary expenses with receipts, bills, or bank statements.

1. Assets

• Cash, bank balances, retirement accounts, investment accounts, real estate (market value and mortgages), vehicles (make/year/loan balance), business equipment, and inventory. Be ready to provide recent statements or appraisals for high-value items.

1. Liabilities

• Mortgages, car loans, credit cards, medical bills, student loans, taxes owed to federal/state/local, and business payables. Include creditor names, balances, minimum payments, and proof of debt where available.

1. Supporting documentation

• Pay stubs, bank statements (usually 3 months), recent tax returns (often 1–3 years), profit-and-loss statements, balance sheets, insurance bills, medical bills, and a copy of any bankruptcy schedules if applicable.

Sources: IRS instructions for Forms 433-A, 433-B, and 433-F (IRS.gov).

How the IRS uses the data: Offers in Compromise, installment agreements, liens, and collections

• Offer in Compromise (OIC): The IRS compares the taxpayer’s reasonable monthly net income and asset equity against the total tax liability to determine a reasonable collection potential. Forms 433 series are the cornerstone of that analysis (see Form 656 instructions and OIC guidance on IRS.gov).
• Installment agreements: The IRS uses the same income-and-expense calculations to set monthly payment amounts. For a full-pay agreement the balance and the payment schedule will reflect the taxpayer’s disposable income.
• Collections decisions: The IRS may hold collections, release levies, or file/withdraw liens based on the information. Accurate disclosure can prevent or stop aggressive collection actions.

See related guidance on installment agreements, including how to use Form 433-F to negotiate a payment plan: How to Use Form 433-F to Negotiate an Installment Agreement.

Which form should you expect to complete?

• Use Form 433-A when the taxpayer is an individual with personal and household finances, including married couples who file jointly in many cases.
• Use Form 433-B for business entities and for owners when the IRS needs a full picture of business financials.
• Use Form 433-F when the IRS needs a shorter statement or for sole proprietors with uncomplicated finances.

In practice, the IRS may request one form and then follow up requesting additional schedules or the other form if they need business details. If you run a small business as a sole proprietor, you may end up completing both a 433-F (for personal snapshot) and supplying business records similar to a 433-B.

Practical, step-by-step approach to prepare and complete the form

1. Gather records first

• Assemble pay stubs, 3 months of bank statements, last 1–3 years of federal tax returns, recent brokerage/retirement statements, mortgage statements, vehicle loan statements, and business P&L and balance sheet if applicable.

1. Run a monthly budget

• Create a one-page summary of typical monthly income and real expenses (not estimates where you can use statements). Flag expenses that are beyond the IRS National Standards (medical, extraordinary transportation) and collect documentation.

1. List assets at realistic values

• Use market comparables for real estate and Kelley Blue Book or dealer quotes for vehicles. The IRS will reduce retirement account values by early-withdrawal penalties and tax impacts when estimating equity.

1. Complete the form typed or legibly

• Typing reduces errors. Answer every line — use zero or N/A where appropriate rather than leaving blanks.

1. Attach supporting documentation

• Label attachments and use a short cover note referencing the form and taxpayer name/SSN. Missing docs are the most common reason for delays.

1. Keep copies and log delivery

• Keep physical and digital copies of the completed form and attachments. Note the date, method, and any IRS rep you speak with.

Common mistakes and how to avoid them

• Underreporting income: Self-employed taxpayers sometimes understate gross receipts. Provide bank deposits and 1099s to validate numbers.
• Inflating expenses: Listing discretionary items as necessary expenses will lead to adjustments. Only claim expenses you can document and that the IRS considers allowable.
• Using outdated tax returns: Provide current year-to-date documents. Relying only on older returns without recent pay stubs or P&Ls undermines credibility.
• Omitting assets: Hiding assets can result in penalties and loss of negotiated agreements.

How to submit and follow up

• Submission methods: Historically, taxpayers mailed or faxed Forms 433. The IRS increasingly accepts secure electronic transmissions in particular collection workflows (for example, through secure online portals used by revenue officers or authorized representatives). Check the current instructions on the IRS form pages and confirm with your revenue officer. (IRS forms: https://www.irs.gov/forms-pubs)
• Response timeline: The IRS may request follow-up documentation within 30 days. Respond promptly; delays can trigger levies or defaulted agreements.

Interaction with liens, levies, and bankruptcy

• A full and accurate 433 package can influence whether the IRS files a Notice of Federal Tax Lien, withdraws a lien, or suspends levies while an agreement is negotiated. For more on lien options, see Options When the IRS Files a Notice of Federal Tax Lien.
• Bankruptcy: Completing a 433-series form does not replace bankruptcy schedules. If you’re in (or considering) bankruptcy, coordinate with your bankruptcy counsel; tax obligations and collection stays interact in complex ways.

Pro tips from practice (15+ years advising clients)

• Be conservative and well-documented: If you can justify an expense, attach the proof. In my practice I’ve seen well-documented medical and disability expenses change a proposed payment from unaffordable to acceptable.
• Use a professional when complexity rises: Partnerships, corporates, or cases with inventory/cost-of-goods sold often benefit from a CPA or enrolled agent preparing business schedules.
• Keep your tax compliance current: The IRS is far more likely to negotiate when returns are filed and estimated taxes are up to date.
• Consider streamlined or partial-payment installment agreements as interim solutions while building an offer in compromise case.

Related: Installment Agreements vs. Offers in Compromise: Which is Right for You?

Frequently asked questions (brief)

• Can I file a 433 electronically? The IRS accepts electronic submission in some collection channels and for representatives using secure portals; otherwise mail or fax remain common. Always check the instructions on the form and confirm with your revenue officer.
• How long is the information valid? The IRS reviews financial situations regularly; an agreement may require annual updates or requests for new forms if circumstances change.
• Will the IRS seize assets if I submit a form? Submitting a form is part of negotiation — it does not guarantee protection. The IRS can still levy if it determines imminent collection is appropriate. Proper documentation, communication, and timely responses reduce that risk.

Sources and further reading

• IRS Form 433-A (Collection Information Statement for Individuals): https://www.irs.gov/pub/irs-pdf/f433a.pdf
• IRS Form 433-B (Collection Information Statement for Businesses): https://www.irs.gov/pub/irs-pdf/f433b.pdf
• IRS Form 433-F (Collection Information Statement): https://www.irs.gov/pub/irs-pdf/f433f.pdf
• IRS Offer in Compromise and Form 656 instructions (IRS.gov)

Professional disclaimer
This article is educational and based on professional experience in financial planning and tax consulting. It is not individualized legal or tax advice. For decisions that affect your tax liabilities, consult a qualified CPA, enrolled agent, or tax attorney.