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Part 3. Submission Processing

Chapter 0. General

Section 101. Schedule K-1 Processing (Cont. 2)

3.0.101  Schedule K-1 Processing (Cont. 2)

3.0.101.19 
Section 02 Errors

3.0.101.19.1 
General Information

3.0.101.19.1.3  (01-01-2008)
Section 02AMD - Corrected/Amended Indicator

  1. Valid characters are "G" and blank.

  2. For Schedule K-1's processed through ISRP enter a "G" if a "G" is coded in the lower right hand corner of the K-1.

  3. For Schedule K-1's processed through SCRIPS, enter a "G" if the Amended K-1 Box is checked.

    Type of K-1 Location of Check Box
    Form 1041 K-1 Below the tax year in the upper right corner
    Form 1065 K-1 Above Part III
    Form 1120S K-1 Above Part III

3.0.101.19.1.4  (01-01-2008)
Section 02CD — Check Digits

  1. This field is not valid for Schedule K-1's.

3.0.101.19.1.5  (01-01-2008)
Section 02NC — Name Control

  1. This field is not valid for Schedule K-1's.

3.0.101.19.1.6  (01-01-2008)
Section 02TTS — TIN Type

  1. This field is not valid for Schedule K-1's.

3.0.101.19.1.7  (01-01-2008)
Section 02SSA — SSA Specific Data

  1. This field is not valid for Schedule K-1's.

3.0.101.20  (01-01-2008)
Section 06 Errors

  1. This section provides instructions for correcting Section 06 error conditions.

3.0.101.20.1  (01-01-2008)
General Information

  1. Section 06 contains money amounts, indicators and descriptions. All fields are dollars only.

  2. Listed below are the fields contained in Section 06 that apply to K-1 processing:

  3. Form 1041 Doc Code 66

    Field Field Length Title +/-``
    0601 12 Interest Amount +
    0602a 12 Dividends Amount +
    0603 12 Net Short Term Capital Gains +
    0604a 12 Net Long Term Capital Gains +
    0605 (ISRP e-file only) 12 Other Portfolio Amount +
    0605 (ISRP e-file only) 12 Ordinary business income +
    0606 12 Ordinary business income +
    0607 12 Net Rental Real Estate Income +
    0608 12 Other Rental Income +
    0614 12 Other Information +

  4. Form 1065 Doc Code 65

    Field Field Length Title +/-
    0601 12 Ordinary Income Amount +/-
    0602 12 Net Real Estate Rental Amount +/-
    0603 12 Other Net Rental Amount +/-
    0604 12 Guaranteed Payments Amount +
    0605 12 Interest Income +
    0606a 12 Ordinary Dividends Amount +
    0607 12 Royalties +
    0608 12 Net Short Term Capital Gains +/-
    0609a 12 Net Long Term Capital Gains +/-
    0612 12 Section 179 Deduction +

  5. Form 1120S Doc Code 67

    Field Field Length Title +/-
    0601 12 Ordinary Income Amount +/-
    0602 12 Net Real Estate Rental Amount +/-
    0603 12 Other Net Rental Amount +/-
    0604 12 Interest Amount +
    0605a 12 Dividends Amount +
    0606 12 Royalties +
    0607 12 Net Short Term Capital Gains +/-
    0608a 12 Net Long Term Capital Gains +/-
    0611 12 Section 179 Deduction +
    0613 12 Credits and Credit Recapture +

3.0.101.21  (01-01-2008)
Section 16 Errors

  1. This section provides instructions for correcting Section 16 error conditions.

3.0.101.21.1  (01-01-2008)
General Information

  1. Section 16 contains the Payer entity data and is required for every record.

  2. Listed below are the fields contained in Section 16 that applies to K-1 processing:

    Field Field Length Title
    16NM1 40 Payer Name Line 1
    16NM2 40 Payer Name Line 2
    16ADD 35 Payer Street Address
    16CTY 22 Payer City
    16ST 02 Payer State Code
    16ZIP 09 Payer Zip Code
    16TIN 09 Payer TIN
    16TVC 01 TIN Validity Bypass Code
    16DLN 14 Payer DLN
    16FCC 02 Foreign Country Code

3.0.101.21.2  (01-01-2008)
Section 16NM1 — Payer Name Line 1

  1. Valid characters are alpha, hyphen, blank, numeric and ampersand.

  2. Invalid Conditions:

    1. Field is completely blank.

    2. Field contains characters other than alpha, hyphen, numeric, or ampersand .

    3. A character follows two consecutive blanks.

    4. The first position contains a blank.

    5. The number of character positions is more than 40.

  3. Correction Procedure:

    1. Check for coding and transcription errors and correct as needed. If name is not present, research using the TIN if present.

      If Then
      There is an address match on CC INOLE Enter the name from INOLE as the Payer.
      There is no information Enter "Z" and continue processing.

3.0.101.21.3  (01-01-2008)
Section 16NM2 — Payer Name Line 2

  1. Valid characters are alpha, hyphen, blank, numeric and ampersand

  2. Invalid Conditions:

    1. Field is completely blank.

    2. Field contains characters other than alpha, hyphen, numeric, or ampersand .

    3. A character follows two consecutive blanks.

    4. The first position contains a blank.

    5. The number of character positions is more than 40.

  3. Correction Procedure:

    1. Check for coding and transcription errors and correct as needed. If name is not present, research using the TIN if present.

      If Then
      There is an address match on CC INOLE Enter the name from INOLE as the Payer.
      There is no information Enter "Z" and continue processing.

3.0.101.21.4  (01-01-2008)
Section 16ADD - Street Address

  1. Description - Field 16ADD is located in the Entity Section of the return.

    1. Valid Characters are alpha, numeric, blank, dash, or slash.

  2. Invalid Condition - Field 16ADD will generate as a field error when any of the following conditions are present:

    1. Any character is present other than alpha, numeric, blank, dash, or slash.

    2. The first position is blank.

    3. Any character follows two consecutive blanks.

  3. Correction Procedures:

    1. Correct all misplaced entries, coding errors, and transcription errors.

    2. If unable to perfect the address, enter ,"ZZZ" as the street address.

  4. Multiple Addresses — If more than one address is present, research INOLE and determine the correct address as follows:

    If Then
    INOLE matches one of the addresses on the return Enter the address listed on INOLE in Field 16ADD.
    INOLE does not match any of the addresses on the return Enter the first address found on the return to field 16ADD.

3.0.101.21.5  (01-01-2008)
Section 16CTY — City

  1. Description - Field 16CTY is located in the Entity Section of the return.

    1. Valid characters are alpha and blank.

  2. Invalid Conditions - Field 16CTY will generate as a field error when any of the following conditions are present:

    1. The first position is blank.

    2. Any character is present and the second and third characters are blank.

    3. Any character follows two consecutive blanks.

    4. The Major City Code does not match any of the valid codes in the Major City Code table.

  3. Correction Procedures:

    1. Correct all misplaced entries, coding errors, and transcription errors.

      Note:

      For a listing of Major City codes, see Exhibit 3.0.101–6.

3.0.101.21.6  (01-01-2008)
Section 16ST — State

  1. Description — Field 16ST is located in the Entity section of the return.

    1. Valid characters are alpha and blank.

  2. Invalid Condition - This field is invalid if it is not contained in the State Code Table.

  3. Correction Procedures:

    1. Correct all misplaced entries, coding errors, and transcription errors.

    2. For a description of valid State Codes, see Document 7475 (State Abbreviations, Major City Codes, and Address Abbreviations).

  4. Correction Procedures for APO/FPO Addresses —

    1. The U.S. Postal Service established new requirements for APO/FPO addresses.

    2. If the old address appears (i.e. AP New York, NY 091XX), convert the address to the new state code abbreviation based on the ZIP Code:

    APO FPO
    APO AA Americas 34000–34049 FPO AA Americas 34050–34099
    APO AE Europe 090XX-094XX and 096XX FPO AE Europe 095XX
    APO AP Pacific 962XX-965XX and 98700–98759 FPO AP Pacific 966XX and 98760–98799

3.0.101.21.7  (01-01-2008)
Section 16ZIP - Zip Code

  1. Description - Field 16ZIP is located in the Entity Section of the return.

    1. Valid characters are numeric and blank.

  2. Invalid Condition - Field 16ZIP will generate as a field error when any of the following conditions are present:

    1. Any character is other than numeric or blank.

    2. An entry is other than five or nine positions.

    3. The entry is not within the range of 00501 and 99999.

    4. The first five positions are blank and an entry is present in the last four positions.

  3. Correction Procedures:

    1. Correct all misplaced entries, coding errors, and transcription errors. Research any of the following for valid ZIP Code information: Document 7475, INOLE, NAMEB/NAMEE.

      If Then
      Field 16ZIP is transcribed incorrectly Enter the correct ZIP Code from the return. Only the first five digits are required.
      A valid ZIP Code is not available from the return or attachment.

      1. Determine the first three digits of a valid ZIP Code for the Major City from Exhibit 3.0.101–6

      2. Enter "01" for the fourth and fifth digits.

      The Major city is not listed in Exhibit 3.0.101–6 or the first three digits cannot be determined Enter the ZIP Code of the state shown in the address from Exhibit 3.0.101–6.

3.0.101.21.8  (01-01-2008)
Section 16TIN — Payer TIN

  1. Description —Field 16TIN is located in Part I of the return

    1. Valid characters are numeric.

  2. Invalid Condition — Field 16TIN will generate as a field error whenany of the following conditions are present

    1. It is not numeric.

    2. It is less than nine characters.

  3. Correction Procedures:

    1. Correct all misplaced entries, coding errors, and transcription errors. If TIN is not present, research using the Name line.

    If Then
    There is a match Enter TIN from research
    A correct number cannot be determined Enter nine 9's.

3.0.101.22  (01-01-2008)
Priority IV Errors - Error Codes 001 through 999

  1. This section provides detailed error correction procedures for Error Codes 001 through 999. These errors will be displayed with the error code assigned to them for the specific error in ascending numerical order. The screen display will show the error code assigned and the fields needed to make the necessary corrections.

3.0.101.22.1  (01-01-2008)
♦Error Code 014 — Address♦

  1. Error code 014 will display as follows:

    Field Designator Field Name Field Length
    01ADD Payee Street Address 35
    01CTY Payee City 22
    01ST Payee State Code 02
    01ZIP Payee Zip Code 09

3.0.101.22.1.1  (01-01-2008)
Invalid Condition - Error Code 014

  1. Error Code 014 will generate when all fields are not present as follows:

    1. If the street address is present, Field 01CTY and 01ST must be present, unless a Major City Code is used.

    2. If a Major City Code is used, Field 01ADD must be present.

    3. A City must be present. If the city is not in the Major City format, Field 01ST must be present. Field 01ADD can be blank.

    4. A Major City Code is used and Field 01ST is present.

3.0.101.22.1.2  (01-01-2008)
Correction Procedures - Error Code 014

  1. Correct all misplaced entries, coding errors and transcription errors.

  2. Compare the displayed fields with the return and attachments. If incorrect, overlay the screen with the correct information.

  3. Research any of the following for valid address information

    • Document 7475

    • INOLE, NAMEE/ENMOD/ NAMEB

    If And Then
    A Major City Code is present A street address is not available

    1. Enter the City Name (Spelled out, not in Major City format) in the 01CTY Field

    2. Enter the State Code in Field 01ST.
    The Major City Code is correct The State is present Delete Field 01ST
    The ZIP Code cannot be corrected from the information on the return, attachments or research   1)Determine the three digits of the Zip Code from Exhibit 3.0.101-6 Enter 01 for the fourth and fifth digits

3.0.101.22.2  (01-01-2008)
♦Error Code 016 — Zip/Major City Code Mismatch♦

  1. Error Code 016 will display as follows:

    Field Designator Field Name Field Length
    01CTY Payee City 22
    01ST Payee State 02
    01ZIP Payee Zip Code 09

3.0.101.22.2.1  (01-01-2008)
Invalid Condition - Error Code 016

  1. Error Code 016 will generate when the ZIP Code is inconsistent with the Major City Code or State Code.

3.0.101.22.2.2  (01-01-2008)
Correction Procedures - Error Code 016

  1. Correct all misplaced entries, coding errors and transcription errors.

  2. Compare the displayed fields with the return and attachments. If incorrect, overlay the screen with the correct information.

  3. Research any of the following for valid ZIP Code information:

    • Document 7475,

    • INOLE, NAMEE/ENMOD/NAMEB

  4. If only the first three digits of the ZIP Code can be determined, enter "01" in the fourth (4th) and fifth (5th) positions.

    If And Then
    Unable to determine a valid ZIP Code from the return or attachment   Enter the valid ZIP Code found through research in Field 01ZIP
    The address is in a major city A Major City Code can be determined,

    1. Enter the name of the city in Field 01CTY

    2. Enter the State Code in Field 01ST
    The address is not in a major city  

    1. Enter the appropriate state abbreviation in Field 01ST

    2. Enter the ZIP Code in Field 01ZIP

  5. Correct Procedures for APO/FPO Address

    1. The U.S. Postal Service established new requirements for APO/FPO addresses.

    2. If the old address appears (i.e.: AP New York, NY 091XX) convert the address to the new state code abbreviations based on the ZIP Code:

    APO FPO