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Part 21. Customer Account Services

Chapter 5. Account Resolution

Section 7. Payment Tracers (Cont. 1)

21.5.7  Payment Tracers (Cont. 1)

21.5.7.4 
Resolving Missing Payments Procedures

21.5.7.4.6 
Processing Complex Payment Tracers

21.5.7.4.6.9  (10-01-2003)
Payment Not Located

  1. If you do not have a copy of the cancelled check, request a copy of both sides of the cancelled check from the taxpayer or an image of the check from the ISRP/RRPS archive system or the RTR System as applicable. For additional information see IRM 21.5.7.4.7.1, ISRP/RRPS or See IRM 21.5.7.3.1, Remittance Transaction Research (RTR) System.

    If Then
    Missing payment will not fully pay the balance due (a) Request balance due from taxpayer.
    (b) Establish an installment agreement per IRM 5.19.1, Balance Due.
    Missing payment will fully pay the balance Input CC STAUP or TC 470 (no Closing Code).

  2. If the missing payment is an FTD, See IRM 21.5.7.3.3, IDRS Research for Federal Tax Deposit (FTDs) and IRM 21.5.7.4.7.15, Federal Tax Deposits (FTD).

  3. If the copy of the cancelled check was provided and you cannot locate the payment, complete all necessary research and:

    1. Prepare Form 4446, Payment Tracer Research Record.

    2. Attach copy of the cancelled check and copies of all research documents.

    3. If applicable, send appropriate "C" letter.

    4. Forward to HPTF function in the campus that processed the payment.

21.5.7.4.6.10  (12-16-2004)
Substantiation Process

  1. The following section provides procedures for creating a substantiated credit in cases where documentation is not available for normal processing. This allows case resolution even if HPTF determines that necessary documentation has been lost or destroyed.

  2. HPTF will continue searching for the payment until it is determined documentation needed to locate the missing payment was destroyed or cannot be located. When the documentation was destroyed or cannot be located, the following key elements are used to create a substantiated credit:

    • Absolute Proof of Payment

    • Authorization

    • Transfer from Account 6570

    Caution:

    Incomplete or illegible Form 4446 could result in unnecessary taxpayer burden by delaying resolution. Please ensure the Form 4446 is complete and includes the originator’s name, IDRS number and phone number. HPTF may return erroneous, incomplete or illegible Forms 4446.

  3. A substantiated credit MUST be allowed if the missing payment is not located within 120 calendar days of receipt by HPTF. Cases accepted in HPTF will be controlled in "M" status on IDRS until the case is resolved.

    Caution:

    Before taking any account action contact the HPTF technician with the IDRS control.

21.5.7.4.6.11  (10-01-2007)
Absolute Proof of Payment

  1. Absolute proof of payment is conclusive evidence that IRS received a payment, e.g.:

    • Cash receipts (Form 809 or IRS NCR receipts)

    • Canceled checks

    • Negotiated money orders

    • Negotiated cashiers checks

    • Narrative descriptions of endorsements by banks, money order vendors, and IRS employees (e.g., Revenue Officers)

  2. NCR receipts must identify the Register Number, time, date, Office Location and type and amount of tax paid.

  3. Absolute proof a Federal Tax Deposit was made is the verification or acknowledgment of a payment submitted to a commercial or Federal Reserve Bank. This proof can be:

    1. A canceled check for the amount of the payment made payable to and negotiated by a commercial depository or a Federal Reserve Bank. Have the bank verify the credit was deposited in the Treasury Tax Loan Account (TT&L).

    2. A commercial bank or federal tax deposit receipt for the amount of payment.

    3. A photocopy of the FTD coupon received in the FTD processing campus.

    4. Transmittal showing the deposit in question was received and processed without adjustment. If an adjustment was made, verify the deposit was not included.

  4. When a lien is on the account (TC 582, lien indicator) and the payment will fully satisfy all outstanding liabilities, request a manual lien release. See IRM 5.12.3.2.1 (5),Liability is Satisfied, regarding manual lien releases. Employees with access to the Automated Lien System (ALS) should input the lien release. Employees without access to ALS should submit Form 13794Request for Release, Partial Release, or Withdrawal of Notice of Federal Tax Lien, to the Centralized Lien Unit. The fax numbers can be found by selecting ″Lien Payoff/Release Contact Numbers″ under the Who/Where tab on the SERP Home Page.

21.5.7.4.6.12  (10-01-2003)
Substantiation of Payment — Authorization Responsibility

  1. The Manager of the Accounting Control/Services Operation reviews and approves substantiated payment credit after research is exhausted.

21.5.7.4.7  (10-01-2003)
Payment Methods/Systems

  1. The following methods/systems are used for making/processing payments:

    • ISRP/RRPS

    • Manual Deposits

    • Field Office Remittances

    • Lockbox Payments

    • Installment Agreement User Fee Lockbox Payments

    • Justice Department Lockbox Receipts

    • Cashier’s Check

    • Money Orders

    • Truncated checks

    • Cash payments

    • ANMF payments

    • Foreign Remittances

    • Treasury Bonds

    • Free items

    • FTD payments

    • Electronic Federal Tax Payment System (EFTPS) payments

    • Electronic Funds Withdrawal (Direct Debit) and Credit Card

    • Direct Debit Installment Agreements

    • Lloyds of London taxpayers

    • State Income Tax Levy Program (SITLP)

21.5.7.4.7.1  (10-01-2007)
ISRP/RRPS

  1. The ISRP Remittance Processing System converts paper tax and information documents, and remittances received by IRS into perfected electronic records of taxpayer data. When a tax document is received it is opened and sorted by form type (e.g., 1040, 1040A etc.). Remittances with their accompanying documentation are pre-sorted into groups called batches. Each batch is uniquely identified by a 12–digit RPSID number. This number always begins with "00" , followed by 6 digits, followed by "0000." This system will capture, store, retrieve, archive (vouchers and check images) and route source data to downstream processing activities which subsequently post to taxpayers account on Master File.

    Note:

    You will not be able to research ISRP payments through the ISRP system once the information is available through RTR.

  2. The information stored in the archive system includes the following:

    1. The actual front image of a paper voucher or an image created from data that an ISRP operator entered when no voucher was present.

    2. Actual images of both sides of the check. The file on the back of the check contains the endorsement and encoding information.

    3. Data used to research for each voucher and related check, such as the TIN, DLN and date of deposit.

    4. The archive system permits the retrieval of document images and data for up to 5 years after the information has been processed through the remittance system.

      Note:

      Document 6209, IRS Processing Codes and Information, Section 4, pages 13 and 14, provide exhibits of the RRPS Electronic Payment Voucher, information about the endorsement data and the IRS audit trail.

  3. When the remittance (checks, money orders, etc.) is processed through RRPS, the remittance amount is encoded at the bottom right front, the IRS audit trail is printed on the back of the remittance to the right of the RPSID number. The system also stamps the U.S. Treasury on the back of the remittance.

  4. In order to resolve missing payments, you may need to research the Remittance Transaction Research (RTR) system. If RTR is not available to your area you may need to research the ISRP Archival Retrieval System. Fax Form 11357, ISRP Archive Retrieval Request, to the campus that processed the payment. See the ISRP Archive Contact List, located on SERP under the Who/Where tab, for a list of contacts for each campus.

    Exception:

    Route payments processed at Memphis to the Cincinnati campus.
    Route payments processed at Philadelphia to the Ogden campus.
    All functions other than Brookhaven Accounts Management (AM) and Cincinnati Accounting function, will route requests for ISRP payments processed at Brookhaven to the Cincinnati campus. Brookhaven AM and Cincinnati Accounting functions will service their own requests.

  5. This process will scan "scannable" vouchers and checks and assign a DLN. Returns with payments will no longer have a Document Locator Number (DLN) that matches the payment DLN. The inflated julian date associated with the deposit item previously processed through RPS will no longer appear on the taxpayer's account.

  6. The ISRP RRPS audit trail is different from the RPS audit trail. It will reflect the following:

    • The tax period and transaction date are on the second line.

    • The identifying information for a payment other than Master File, such as a photocopy payment, will also be displayed on the second line. The symbols will be the last 7 to 9 digits. For example, 20X0903. See IRM 3.8.44, Campus Deposit Activity, for additional information.

    • If the payment is a multiple or split payment, an M or S will appear between the tax period and the transaction date.

  7. The following is a comparison of the RPS/ISRP DLN:

    DLN Element RPS ISRP
    File Location Code Applicable SC Code Applicable SC Code
    Tax Class Various Various
    Document Code All Codes 17 - subsequent payment
    19 - overflow
    70 - TC 610 tax return payment
    76 - overflow
    20 - TC 430
    Julian Date Date work batched Deposit date
    Block Series Per IRM 3.5.61.3.24, Integrated Submission and Remittance Processing (ISRP). 000 - 999
    Serial Number 00 - 99 RPS Number 00 - 99 System Assigns
    Year Digit Year processed RPS Number Year Processed System Assigns

  8. Payment Tracer procedures outlined in See IRM 21.5.7, Payment Tracers, should be followed for ISRP payments prior to initiating the following action:

    1. You have a copy of the front and back of the canceled check, and cannot find the payment through preliminary research. Complete the Form 4446, enter the appropriate STAUP and TC 470 to hold the notices. The case must be transferred to Hardcore Payment Tracer Function (HPTF). Send Letter 86C if appropriate. See IRM 21.3.3.4.2.1, Use of Letter 86C, to determine when it is necessary to notify the taxpayer.

    2. If you have a "slipped block" request the five documents before and after your payment if RTR is not available. If more than three payments have been misapplied, prepare Form 4446, Payment Tracer Research Record,when appropriate send Letter 86C. Enter the appropriate STAUP and TC 470 to hold the notices. Transfer the case to HPTF. If three payments or less have been misapplied, you should resolve the issue and have the payments applied to the correct accounts.

21.5.7.4.7.2  (10-01-2003)
Manual Deposits

  1. Deposit items that are not processed through ISRP must be processed through Manual Deposit, Lockbox or IDRS. These include unidentified deposits and re-deposits of dishonored checks. Receipt and Control will prepare a payment posting voucher whenever a source document is not available and the remittance cannot be processed through RRPS.

  2. Remittances processed manually are underlined with a rocker symbol in green pencil, "green rockered" on the return. Encoder information is on the back of the check.

  3. Remittances are applied instantaneously when applied to the taxpayer's account through IDRS. Receipt and Control will prepare source documents for IDRS input.

  4. The NCR encoder is used for encoding and endorsing remittances not processed through RRPS. The DLN is not printed on the back of the check, but a sequence number is. You may use this sequence number to locate the encode tape for the DLN. Remittances will be endorsed with the agency location code of the office receiving the credit. See IRM Exhibit 3.8.44–7, Agency Location Codes (ALC), which provides information on agency location codes.

21.5.7.4.7.3  (10-01-2003)
Field Office Remittances

  1. Field Office Payment Processing involves all payments received from the field office employees. Field offices use overnight services to transship the tax receipts to their designated Submission Processing Center. See IRM 3.8.45.28.6.1, Submission Processing Center/Field Office Payment Processing Alignment for Form 809 Receipts and Other Payments. Cash remittances must be converted to check or money order before sending for processing.

  2. Field office employees issue Form 809 when they receive cash. If payment is by check, money order, etc., a receipt is issued to the taxpayer.

  3. When the Field office employee issues Form 809, it becomes a posting document. The only exception is when the remittance is submitted with an original return. Then, the original return becomes the posting document.

  4. If the payment cannot be located after all preliminary research has been completed, prepare Form 4446, Payment Tracer Research Record, and forward the case to the Hardcore Payment Tracer Function (HPTF) at the campus that processed the payment, or processed the most recent payments.

21.5.7.4.7.4  (10-01-2007)
Lockbox Payments

  1. The Lockbox operation involves the processing of tax payments by commercial banks. This method of processing payments accelerates the handling and deposit of funds received and is forwarded to Treasury.

  2. Lockbox banks process payments for the following IMF products:

    • CP 521, Installment Agreement Reminder Notice

    • CP 523, Installment Agreement Default Notice

    • Form 433-D, Direct Debit Installment Agreements

    • Form 1040, Form 1040A, and Form 1040EZ, U.S. Individual Income Tax Return

    • Form 1040, International, will now be processed for Austin SPC

    • Form 1040-ES, Estimated Tax for Individuals

    • Form 1040NR, U.S. Nonresident Alien Income Tax Return

    • Form 1040-PR, U.S. Self-Employment Tax Return (Puerto Rico)

    • Form 1040-SS, U.S. Self-Employment Tax Return (Virgin Islands, Guam, American Samoa, Northern Mariana Islands)

    • Form 1040X, Amended U.S. Individual Income Tax Return

    • Form 2159, Payroll Deduction Installment Agreements

    • Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return

    • Form 8892, Payment of Gift/GST Tax and/or Application for Extension to File Form 709

    • Form 9465, Installment Agreements Requests

    • Letter 3640/3641, Federal Tax Lien Payoff Letters

    • Letter 3856/3856-A, Manually Monitored Installment Agreements

    • User fees and other installment payments

  3. Lockbox banks process payments for the following BMF products:

    • CP 521, Installment Agreement Reminder Notice

    • CP 523, Installment Agreement Default Notice

    • Form 433-D, Direct Debit Installment Agreements

    • Form 940/940-EZ, Employer’s Annual Federal Unemployment (FUTA) Tax Return

    • Form 941, Employer’s Quarterly Federal Tax Return

    • Form 943, Employer’s Annual Tax for Agricultural Employees Return

    • Form 944,Employer’s Annual Federal Tax Return

    • Form 945, Annual Return of Withheld Federal Income Tax

    • Form 1041ES, Estimated Income Tax for Estates and Trusts

    • Form 2159, Payroll Deduction Installment Agreements

    • Form 2290, Heavy Highway Vehicle Use Tax Return

    • Form 9465, Installment Agreement Request

    • Letter 3640/3641, Federal Tax Lien Payoff Letters

    • Letter 3856/3856-A, Manually Monitored Installment Agreements

    • User fees and installment payments

  4. Taxpayers mail remittances to the IRS at designated post office boxes for each form type. These addresses can be found in the instructions for the forms listed in (2) and (3) above.

  5. The bank encodes and endorses the checks. The DLN, TIN, name control, received date, and tax period are printed on the back of the check.

  6. The lockbox system generates an Optical Character Recognition (OCR) Remittance Register, similar to the 813 Remittance Register.

  7. The DLN consists of a file location code (FLC), (the first two digits in the DLN), unique to lockbox processing. Use this number with the bank endorsement to determine the correct campus to research.

  8. All lockbox banks image checks and vouchers. Images can be viewed via Remittance Transaction Research (RTR).

    1. If you need a copy of a check and the payment DLN has a list year of 4 (last digit of the DLN) or subsequent, research RTR to retrieve the check image.

    2. If you need a copy of a check and the payment DLN has a list year of 3 (last digit of the DLN) or prior, complete Form 9533, Lockbox Information Request. Fax Form 9533 to the appropriate campus as outlined in the following chart:

      If the FLC is: Then FAX to the Accounting function in: Fax Number:
      01, 02, 03, 04, 05, 06 Andover Campus 978-474-5234
      13, 22, 26, 27, 31, 35, 56, 62 Cincinnati Campus 859-669-5053
      33, 68, 77, 94 Fresno Campus 559-456-5670
      36, 39 Kansas City Campus 816-292–6205
      59, 65 Atlanta Campus 770-455-2399
      73, 75 Austin Campus 512-460-7512
      23, 25, 51, 87, 88, 91, 92 Ogden Campus 801-620-7897

      Note:

      The fax numbers above are for internal use only.

  9. The Accounting function in each campus will receive and process Form 9533, Lockbox Information Requests. They will fax the form to the lockbox bank to acquire a copy of the check/voucher or credit and debit adjustments.

  10. The lockbox bank has 10 business days from the date the photocopy request is received to respond.

  11. If a debit or credit adjustment is needed, the lockbox bank has 21 calendar days to respond.

  12. When the lockbox bank locates the payment, the debit or credit adjustment is sent to the Accounting Control/Services Operation. The payment should post in 6 - 8 weeks. Requestors submitting lockbox adjustments are required to monitor these cases until the payment posts.

21.5.7.4.7.5  (10-01-2007)
Installment Agreement User Fee Lockbox Payments

  1. The Lockbox operation also processes Installment Agreement User Fees. These payments are encoded as follows:

    Non-Revenue User Fee Non-Revenue & (Tax) Revenue
    Document Type Indicator DLN
    Block/Batch TIN
    Sequence Number Name Control
    Deposit Date MFT
    TIN Tax Period
    Name Control Multiple Indicator
    Account Number Received Date
    Multiple Indicator  

    If And Then
    Check encoded with "S" Includes DLN Check is for payments split between user fees and tax. (DLN reflects the tax payment.)

  2. The account number for user fees is:

    1. Origination fee of $52 for Direct Debit Installment Agreements (DDIA) with agreement acceptance dates of Jan. 2, 2007 and later. With earlier acceptance dates, the fee was $43.

    2. Origination fee of $105 for all other IAs, with agreement acceptance dates of Jan. 2, 2007 and later. With earlier acceptance dates, the fee was $43.

    3. Reinstatement/Restructuring fee of $45 for all IAs reinstated or revised after Jan. 2, 2007. With earlier acceptance dates, the fee was $24.

  3. If a user fee payment cannot be located, transfer/reassign the case to the Compliance Services Collection Operation (CSCO), at the campus that processed the payment.

  4. CSCO will research the following User Fee Reports in Accounting:

    • User Fee Block Detail Listing - Lists payment, payment date, and Batch/Block Number.

    • User Fee Batch/Block Totals Report - Lists block of payments for each date, Batch/Block Number, account number, number of items, and Batch/Block Amount.

    • User Fee Split Balance Report - Lists payments split between User Fees and Tax payments, Sequence Number, TIN, Check Amount, User Fee Amount, and Revenue amount (payment other than user fee amounts.

  5. User fees related to installment agreements are on IDRS under MFT 13 or 55. MFT 13 or 55 is created when the CP 521 is generated. A TC 971 AC 82 or 83 will be sent to Master File to establish the module. Unlike other MFT 13 or 55 accounts, there will be no reference numbers. You must use CFOL command codes to research these modules. The user fee recovery program continued during 2002. In 2003, a new category was established on the Installment Agreement Accounts List, IAAL, for duplicate payments. Use command code ADD/ADC24 to move payments found on MFTs 13 or 55. For additional information see IRM 5.19.1.5.4.3.3,User Fee Payment Transfer/User Fee Abatements.

21.5.7.4.7.6  (10-01-2007)
Justice Department Lockbox Receipts

  1. These receipts result from court actions and IRS referrals to Department of Justice (DOJ) for collection. Atlanta Submission Processing Center receives Standard Form 1081, Voucher and Schedule of Withdrawals and Credits, as notification of tax revenue secured by the (DOJ).

  2. If a taxpayer's canceled check shows a DOJ endorsement:

    1. Transfer the case to ATSC, HPTF.

    2. Issue Letter 86C to notify taxpayer the inquiry was transferred to ATSC.

    3. Delay notices as appropriate.

  3. Prepare Form 3210, Document Transmittal, to include:

    1. Payment Tracer Request - Department of Justice Inquiry - Accounting Control/Services Operation, ATSC — HPTF Stop 151.

    2. Taxpayer’s name, TIN, and tax period.

    3. TC 470 or CC STAUP input.

    4. Date Letter 86C was sent.

  4. HPTF will coordinate the resolution with Accounting personnel in accordance with IRM 3.17.30.13, Revenue Receipts.

21.5.7.4.7.7  (10-01-2003)
Cashier’s Check

  1. Cashier’s checks may be purchased from banks or other financial institutions.

  2. Receipts or copies of personal checks, used to purchase cashiers checks, only serve as proof of payment to initiate research. Taxpayer is responsible for contacting the vendor for a copy of the canceled check.

    If And Then
    Payment cannot be located   Request a copy of the canceled check from taxpayer. Close the case. Input CC STAUP for 6 cycles.
    Payment has not cleared the bank Bank will not issue a duplicate check unless they have an indemnity agreement Secure an indemnity agreement. Follow the procedures in IRM 3.17.243, Miscellaneous Accounting, and IRM 3.0.167, Losses and Shortages, regarding indemnity agreements.

21.5.7.4.7.8  (10-01-2003)
Money Orders

  1. Money order vendors leave the payee, payer, and date information blank on the money order. Taxpayer is responsible for providing this information.

    If And Then
    Payment cannot be located   Request that taxpayer contact vendor for photocopies of the money order. Close the case. Input CC STAUP for 6 cycles.
    Money order was not cashed Issuing company requests an indemnity agreement Follow the procedures in IRM 3.17.243, Miscellaneous Accounting and IRM 3.0.167, Losses and Shortages, to secure an indemnity agreement.

21.5.7.4.7.9  (10-01-2003)
Truncated Checks

  1. Truncated checks are carbonless copies of original checks. Financial institutions no longer returning canceled checks to their clients furnish these check books.

  2. If the payment cannot be located, send the taxpayer Letter 167C to request they contact the bank for a microfilm or computer image of the check . Close the case and input CC STAUP for 6 cycles.

21.5.7.4.7.10  (10-01-2004)
Cash Payments

  1. Field/Area Offices issue Form 809, Receipt for Payment of Taxes, or a cash register receipt to taxpayer for cash payments.

  2. The tax return is validated at the time of receipt showing the amount and type of tax paid.

  3. The field/area office prepares Form 783, Remittance Register, or Form 795, Daily Report of Collection Activity, to list the payments. These forms are sent to the Submission Processing campus.

  4. Research IDRS, including CC URINQ and XSINQ and RTR if available for these remittances.

  5. If unable to locate the payment, prepare Form 4446, Payment Tracer Research Record. Transfer the case to the HPTF at the campus that processed the payment or processed the most recent payments.

  6. HPTF will verify Form 813 for the payment. HPTF will contact Internal Security, before allowing a substantiated credit from Account 6570, based on Form 809 as proof of payment.

    Note:

    If unable to locate, it may be necessary to contact the field/area office that took the payment in and request a copy of the money order purchased for the cash payment.

21.5.7.4.7.11  (01-30-2006)
Automated Non-Master File (ANMF) Payments

  1. A DLN with a tax class "6" (the 3rd digit of the DLN) identifies a payment as Non-Master File (NMF). A flashing "N" at the bottom of the ENMOD, SUMRY and TXMOD screens indicate there is a NMF account at another Submission Processing (SP) Center. To access the NMF account, an "N" is input after the TIN on SUMRY or TXMOD.

    Note:

    All NMF accounts were centralized at the Cincinnati Campus as of September 2006.

  2. All Automated Non-Master File (ANMF) open accounts are available for research via Desk Top Integration (DI). DI users will see a NMF alert in the DI Account Summary Alerts section. A NMF password is not required to access the DI NMF information. DI provides access to transcript information for all open ANMF modules. The DI NMF transcript is available for printing, however it is for "INTERNAL USE ONLY."

    Note:

    Never send the DI NMF transcript to the taxpayer. While working your payment tracer case, if the taxpayer requests a copy of their NMF transcript and/or payoff information and you are not a NMF CSR, refer them to the NMF toll-free number, 1-888-829-7434 for assistance. The NMF CSR will provide a user friendly transcript and payoff information as requested.

  3. Contact the Accounting NMF function for researching payments dated before 1992, pre-ANMF payments. If the payment is found in another campus, request the credit be transferred to taxpayer's account. See IRM 3.17.46, Automated Non-Master File Accounting, for instructions on requesting NMF research and transcripts.

    Note:

    January 1, 2001, Master File introduced the new MFT 31, Separate Assessment Module. MFT 31 contains split spousal assessments previously processed to the ANMF System. Any new separate spousal assessments established on or after January 1, 2001, will be processed on MFT 31. Any spousal assessments processed prior to January 1, 2001, will remain on the ANMF and must be researched using the above NMF procedures. For more information regarding MFT 31, Split Spousal Assessments refer to IRM 21.6.8, Split Spousal Assessments (MFT 31). Follow normal payment tracing procedures for MFT 31 accounts.

21.5.7.4.7.12  (10-01-2007)
Foreign Remittances

  1. All international or possession returns with remittances are deposited where received. As of July 1, 2007, IMF international returns are sent to the Austin campus and BMF international returns are sent to the Ogden campus. Remittances drawn on foreign banks payable in U.S. dollars through U.S. banks must have U.S. bank’s routing symbol printed in the lower left corner of the check and have a nine digit routing number. These are processed as a regular deposit.

  2. Any foreign remittance including remittances that are payable in U. S. dollars, drawn on foreign banks, and received with tax returns or documents, that fail to meet any portion of (1) above will be processed using manual deposit. The deposits are then mailed to Citibank in Wilmington, Delaware and numbered and processed as a foreign remittance.

  3. Receipt and Control will process source documents with remittances that are payable in foreign currency and drawn on foreign banks as manual deposits. The deposits are mailed to Citibank for a money conversion report.

  4. When foreign currency is received, Receipt and Control will contact Bank of America to convert foreign currency to U. S. dollars. The tax return or document will be processed using manual deposit guidelines.

  5. Each campus has specific deposit processing procedures. See IRM 3.8.45.26, Specific Campuses Processing,for additional information.

  6. For additional information on foreign remittances, see IRM 3.8.45.15, Foreign Check Remittances.

21.5.7.4.7.13  (04-19-2006)
Treasury Bonds

  1. The tax due on Form 706, Estate Tax Return, can be paid with redeemed Treasury Bonds (TC 678). The Bureau of Public Debt (BPD) or a Federal Reserve Bank deposits the proceeds of the bonds to the credit of the Submission Processing Center designated on Form PD1782, Application for Redemption at Par of United States Treasury Bonds Eligible for Payment of Federal Estate Tax.

  2. On a daily basis, the BPD will request the Philadelphia Regional Financial Office to issue U. S. Treasury checks payable to the "Director of the Internal Revenue Service for the Benefit of Estate" to the campus responsible for the estate. Form PD1782is faxed to each campus approximately seven days before the Treasury check arrives.

  3. The faxed copy of the PD1782 is used by Receipt and Control as a source document. TC 678 is input, and the check is processed through RRPS.

  4. Form PD1782 will contain the name of the decedent, decedent’s TIN, date of decedent’s death, tax due date, redemption date, and amounts.

  5. To locate the payment, research the following:

    • Social Security Number followed by a "V (valid SSN on BMF)" or "W (invalid SSN on BMF)"

    • NAMEI/NAMES for another SSN, IRSN, or ITIN.

    • NAMEE/NAMEB for an EIN

    • If an EIN is located, research in SSN format for valid and invalid segments.

      Note:

      The encoding is located on the back of the check near the bottom.

  6. If unable to locate, prepare Form 4446, Payment Tracer Research Record, and forward to the HPTF function at the campus that processed the bond. The HPTF function will continue to search for the payment. HPTF may need to research the file of Forms PD 1782 held in Accounting.

    If Then
    Unable to locate the payment Contact the Bureau of Public Debt at (304) 480–7936. See IRM 3.17.79, Accounting Refund Transactions.
    Bond was returned to the attorney for the estate, by the Bureau of Public Debt Close the Case.

21.5.7.4.7.14  (10-01-2005)
Free Items

  1. If taxpayer's canceled check is stamped "FI" , it indicates the bank is holding credits belonging to taxpayer, referred to as "Free Items."

  2. If the case involves "Free Items" :

    1. Obtain a current transcript of the account.

    2. Prepare Form 4446, Payment Tracer Research Record

    3. Route to the HPTF function at the campus center that is responsible for processing the payment when it is received.

    4. The HPTF will initiate action to obtain the credit from the bank.

21.5.7.4.7.15  (01-30-2006)
Federal Tax Deposits (FTD)

  1. Under the Federal Tax Deposit (FTD) system, taxpayers are not permitted to make FTD payments directly to IRS. Effective October 2000, the former system used to process FTD payments, Treasury Tax and Loan System (TT&L) was replaced by PATAX (Paper Tax). The PATAX system consolidated FTDs into one Federal Reserve Bank (FRB). All commercial banks accepting FTDs report deposits to St. Louis FRB.

  2. The following tax returns require payments to be made through an FTD submission:

    Form Requiring FTD Submission