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Part 3. Submission Processing

Chapter 11. Returns and Documents Analysis

Section 3. Individual Income Tax Returns (Cont. 10)

3.11.3  Individual Income Tax Returns (Cont. 10)

3.11.3.57 
Prior Year Returns

3.11.3.57.3 
Prior Year Return Editing Procedures

3.11.3.57.3.2 
Form 1040 Forms and Schedules

3.11.3.57.3.2.17  (01-01-2008)
Form 4835

  1. "X" Form 4835 when it is attached.

    Reminder:

    Edit amounts from Form 4835 to Schedule E, as required.

3.11.3.57.3.2.18  (01-01-2008)
Form 4972

  1. "X" the Form 4972 for tax year 2006 through 1994 if Part I has entries but Parts II and III are blank.

  2. "X" the Form 4972 when it is filed for tax years 1993 and prior.

3.11.3.57.3.2.19  (01-01-2008)
Form 5329

  1. "X" Form 5329 for tax year 1974 and prior.

3.11.3.57.3.2.20  (01-01-2008)
Form 6198

  1. "X" the Form 6198 when it is filed for tax year 1985 and prior.

3.11.3.57.3.2.21  (01-01-2008)
Form 6251

  1. Use the table below when editing Form 6251 for TY01 through TY93. Edit only the T-Lines listed in the table.

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡     		≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡
    ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡
    ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡

    Note:

    Use current year forms when renumbering is not practical. When editing on a PY form, delete any line number that matches a current year T-Line but that is not listed in the table above.

  2. "X" the Form 6251 when it is filed for TY92 and prior.

3.11.3.57.3.2.22  (01-01-2008)
Form 8615

  1. For TY06, "X" Form 8615 when the amount on line 1 is $1,700 or less.

  2. For TY05 through TY04, "X" Form 8615 when the amount on line 1 is $1,600 or less.

  3. For tax years 2003 through 01,"X" Form 8615 when the amount on line 1 is $1,500 or less.

  4. For tax years 2000 through 1998,"X" Form 8615 when the amount on line 1 is $1,400 or less.

  5. For tax years 1997 through 1995, "X" Form 8615 when the amount on line 1 is $1,300 or less.

  6. For tax years 1994 through 1992, "X" Form 8615 when the amount on line 1 is $1,200 or less.

  7. For tax year 1991, "X" Form 8615 when the amount on line 1 is $1,100 or less.

  8. For tax year 1990 through 1987, "X" Form 8615 when line 1 is $1,000 or less.

  9. Edit FS "6" on tax years 1990 through 1987 when the taxpayer has marked the "Married Filing Separately" box and has written "spouse" on the dotted portion next to the "Parent's number of exemptions" box.

  10. "X" the form when it is for tax year 1986 or prior. Do not correspond.

3.11.3.57.3.2.23  (01-01-2008)
Form 8812

  1. "X" the form when line 1 is less than $3,000 for TY06-03.

  2. "X" the form when line 1 is less than $1,800 for TY02-01.

  3. "X" the form when line 6 is less than $1,500 for TY00-98.

  4. "X" the form when it is for TY 97 or prior.

3.11.3.57.3.2.24  (01-01-2008)
Form 8814

  1. Use the chart below to determine the correct editing of Form 8814 when it is for tax year 2006:

    If the amount on Then
    Line 4 is $850 or less, "X" Form 8814.
    Line 14 is $850 or more and line 15 is blank, Edit "$85" on line 15.
    Line 14 is less than $850 and line 15 is blank, Multiply the amount on line 14 by 10% (.10) and edit the result on line 15.
    Line 14 is blank, dash, or zero, Do not edit an amount on line 15.

  2. Use the chart below to determine the correct editing of Form 8814 when it is for tax years 2005 through 2004:

    If the amount on Then
    Line 4 is $800 or less, "X" Form 8814.
    Line 14 is $800 or more and line 15 is blank, Edit "$80" on line 15.
    Line 14 is less than $800 and line 15 is blank, Multiply the amount on line 14 by 10% (.10) and edit the result on line 15.
    Line 14 is blank, dash, or zero, Do not edit an amount on line 15.

  3. Use the chart below to determine the correct editing of Form 8814 when it is for tax years 2003 through 2001:

    If the amount on Then
    Line 4 is $750 or less, "X" Form 8814.
    Line 14 is $750 or more and line 15 is blank, Edit "$75" on line 15.
    Line 14 is less than $750 and line 15 is blank, Multiply the amount on line 14 by 10% (.10) and edit the result on line 15.
    Line 14 is blank, dash, or zero, Do not edit an amount on line 15.

  4. Use the chart below to determine the correct editing of Form 8814 when it is for tax years 2000 through 1998.

    If the amount on Then
    Line 4 is $700 or less, "X" Form 8814.
    Line 14 is $700 or more and line 15 is blank, Edit "$105" on line 15.
    Line 14 is less than $700 and line 15 is blank, Multiply the amount on line 14 by 15% (.15) and edit the result on line 15.
    Line 14 is blank, zero, or a dash, Do not edit an amount on line 15.

  5. Use the chart below to determine the correct editing of Form 8814 when it is for tax years 1997 and 1996.

    If the amount on Then
    Line 4 is $650 or less, "X" Form 8814.
    Line 14 is $650 or more and

    Line 15 is blank,     		Edit "$98" on line 15.
    Line 14 is less than $650 and

    Line 15 is blank,     		Multiply line 14 by 15% (.15) and edit the result to line 15.

  6. Use the chart below to determine the correct editing of Form 8814 when it is for tax years 1995 through 1989.

    If the amount on Then
    Line 4 is $500 or less, "X" Form 8814.
    Line 14 is $500 or more and

    Line 15 is blank,     		Edit $75 on line 15.
    Line 14 is less than $500 and

    Line 15 is blank,     		Multiply line 14 by 15% (.15) and edit the result to line 15.

  7. "X" the Form 8814 when it is for tax year 1988 or prior. Do not correspond.

3.11.3.57.3.2.25  (01-01-2008)
Form 8839

  1. "X" Form 8839 when it is attached to a return for tax years 1996 and prior.

    Note:

    Do not convert prior year Form 1040A to Form 1040 solely because Form 8839 is present.

3.11.3.57.3.2.26  (01-01-2008)
Form 8853

  1. "X" Form 8853 when it is attached to a return for tax years 1996 and prior.

3.11.3.57.3.2.27  (01-01-2008)
Form 8606

  1. "X" Form 8606 when it is attached to a return for tax years 1997 and prior.

3.11.3.57.3.2.28  (01-01-2008)
Form 8863

  1. "X" Form 8863 when it is attached to a return for TY97 and prior.

3.11.3.57.3.2.29  (01-01-2008)
Form 8880

  1. "X" Form 8880 when it is attached to a return for TY01 and prior.

3.11.3.57.3.2.30  (01-01-2008)
Form 8889

  1. "X" Form 8889 when it is attached to a return for TY03 and prior.

3.11.3.57.3.2.31  (01-01-2008)
Form 8801

  1. "X" Form 8801 for TY06 and prior.

3.11.3.57.3.3  (01-01-2008)
Form 1040A

  1. Follow the guidelines in IRM 3.11.3.57.3.1 for editing the following return information:

    • Tax period

    • Filing status

    • Dependent exemptions

    • Standard deduction amounts

    • Dependency Status Indicator coding

  2. Follow the guidelines in IRM 3.11.3.57.1 for information on editing Received Dates.

  3. Certain conditions on a prior year Form 1040A may require it to be converted to a Form 1040. These conditions are identified in the Form 1040A instructions in IRM 3.11.3.51.1.1. In addition to those conditions, convert a prior year Form 1040A when any of the following conditions are present:

    1. The tax year is 2006 and Penalty on Early Withdrawal of Savings and/or Jury Duty Pay you gave your employer is present.

    2. For tax year 1990 a transcribed form or schedule other than Schedules 1, 2, or 3, or Forms 2441, 3471, or 8615, or Schedule B or Schedule R is attached.

    3. For tax years 1989 and prior a transcribed form or schedule other than Forms 2441, 3471, or 8615 or Schedule B is attached.

    4. For tax years 1987 and prior a filing status of "5" is indicated.

    5. The tax year is 1972 or prior.

3.11.3.57.3.3.1  (01-01-2008)
Line 7—Wages

  1. Use the following chart to determine the correct action for perfecting line 7.

    If the tax year is Then
    1989 and prior and

    There is an indication that self-employment income is included on line 7,     		•"X" the amount on line 7.
    • Edit RPC "N" when the self-employment income is $400 or more.

    Note:

    Do NOT edit RPC "N" when the taxpayer reported self-employment income as wages on line 7 and included the amount on a Form 4137.

    1983 and prior, Do not edit SSB and RRB (nontaxable income).

3.11.3.57.3.3.2  (01-01-2008)
Line 8b—Tax-Exempt Interest Income

  1. Do not edit the amount claimed when the tax year is 1984 and prior.

3.11.3.57.3.3.3  (01-01-2008)
Line 9a—Dividends

  1. Edit amount of dividend income after exclusion for tax years 1986 and prior.

3.11.3.57.3.3.4  (01-01-2008)
Line 10–Capital Gain Distributions

  1. For 1999 and prior convert to Form 1040.

3.11.3.57.3.3.5  (01-01-2008)
Lines 11a & 11b—IRA Distributions

  1. Do not edit IRA distributions for tax year 1989 and prior.

3.11.3.57.3.3.6  (01-01-2008)
Lines 12a & 12b—Pensions

  1. Do not edit lines 12a and 12b for tax years 1989 and prior.

3.11.3.57.3.3.7  (01-01-2008)
Line 13—Unemployment Compensation

  1. Edit taxable amount of unemployment compensation for tax years 1986 through 1979.

  2. Delete unemployment compensation amounts on line 13 when the tax year is 1978 or prior.

3.11.3.57.3.3.8  (01-01-2008)
Lines 14a & 14b—Social Security Benefits

  1. Do not edit lines 14a and 14b for tax years 1989 and prior.

3.11.3.57.3.3.9  (01-01-2008)
Line 16—Educator Expenses

  1. "X" for TY01 and prior.

3.11.3.57.3.3.10  (01-01-2008)
Penalty on Early Withdrawal of Savings

  1. For TY06 if an amount is present, convert to Form 1040 and edit amount to line 30.

3.11.3.57.3.3.11  (01-01-2008)
Line 17—IRA Deduction

  1. "X" the amount on line 17 for TY06 when it is other than $4,000 or $5,000 ($8,000, $9,000 or $10,000 for FS2) and one of the indicators in (4) below -- with an equal deferred compensation amount -- appears on Form W-2. (See Figure 3.11.3-89)

  2. "X" the amount on line 17 for TY05 when it is other than $4,000 or $4,500 ($8,000, $8,500 or $9,000 for FS 2) and one of the indicators in (4) below -- with an equal deferred compensation amount -- appears on Form W-2.(See Figure 3.11.3-89).

  3. "X" the amount on line 17 for TY04 - TY02 when it is other than $3,000 or $3,500 ($6,000, $6,500 or $7,000 for FS 2) and one of the indicators in (4) below -- with an equal deferred compensation amount -- appears on Form W-2. (See Figure 3.11.3-89).

  4. "X" the amount on line 17, for TY01 and prior, when it is other than $2,000 ($4,000 for FS 2) and one of the following indicators—with an equal deferred compensation amount—appears on Form W–2. (See Figure 3.11.3–89).

    • "D" or Section 401(k)

    • "E" or Section 403(b)

    • "F" or Section 408(k)(6)

    • "G" or Section 457(b)

    • "Q" or "Housing/Subsistence" or "Combat Pay"

    • "S" or "SIMPLE" plan

    • "T" or employer-paid "qualified adoption expenses"

    • Section 125, Cafeteria Plan (CAF)

    • Section 414(h), Mandatory Salary Deferral ("PERS" Public Employees Retirement System)

    • Thrift Savings Plan or "TSP"

3.11.3.57.3.3.12  (01-01-2008)
Line 18—Student Loan Interest

  1. "X" the Student Loan Interest for tax years 1997 and prior.

3.11.3.57.3.3.13  (01-01-2008)
Line 19—Tuition and Fees Deduction

  1. "X" for TY01 and prior.

    Note:

    Form 8917 is not required for supporting documentation for TY06 and prior.

3.11.3.57.3.3.14  (01-01-2008)
Jury Duty Pay

  1. For TY06 if an amount is present, convert to a Form 1040 and edit amount to the dotted portion of line 36.

3.11.3.57.3.3.15  (01-01-2008)
Line 28—Tax

  1. Correspond for the missing Form 8615 when all of the following conditions are present:

    • The tax year is 1995 or prior

    • The box on line 26 is marked

    • Form 8615 is not attached

3.11.3.57.3.3.16  (01-01-2008)
Line 30—Credit for the Elderly

  1. Do not edit the Credit For The Elderly when the tax year is 1989 or prior.

3.11.3.57.3.3.17  (01-01-2008)
Line 31 — Education Credit

  1. "X" line 31 if any of the following apply:

    1. Tax Period is TY97 or prior

    2. FS 3 or 6

    3. FS 2 and the AGI is greater than $100,000

    4. FS 1, 4, 5 or 7 and the AGI is greater than $50,000 or

    5. Taxpayer claims both the Hope Credit and Lifetime Learning Credit for the same person on Form 8863

  2. If an amount is claimed on line 31, Form 8863 must be attached. Correspond if missing.

    Exception:

    Do not correspond when line 27 of Form 1040A is (or can be determined to be) zero or negative amount.

3.11.3.57.3.3.18  (01-01-2008)
Line 32 - Child Tax Credit

  1. "X" the child tax credit for tax year 1997 and prior.

3.11.3.57.3.3.19  (01-01-2008)
Line 33 — Retirement Savings Contribution Credit

  1. "X" when claimed for TY 2001 and prior.

3.11.3.57.3.3.20  (01-01-2008)
Adoption Credit

  1. "X" the adoption credit for tax years 1996 and prior.

3.11.3.57.3.3.21  (01-01-2008)
Rate Reduction Credit

  1. "X" any amount claimed for Rate Reduction Credit.

3.11.3.57.3.3.22  (01-01-2008)
Line 38 -- Withholding

  1. Correspond when an amount claimed on line 38 is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , if withholding support is not present and withholding support cannot be determined through internal research.

3.11.3.57.3.3.23  (01-01-2008)
Line 39—ES Tax Payments

  1. Do not edit line 38b for tax years 1989 and prior.

3.11.3.57.3.3.24  (01-01-2008)
Line 40a—Earned Income Credit

  1. Use the instructions for editing earned income credit on prior year Forms 1040. Those instructions can be found in IRM 3.11.3.57.3.1.15.

3.11.3.57.3.3.25  (01-01-2008)
Line 41—Additional Child Tax Credit

  1. "X" the Additional Child Tax Credit for tax years 1997 and prior.

3.11.3.57.3.3.26  (01-01-2008)
Line 45—ES Credit Elect

  1. Do not edit line 45 when the tax year is 1989 or prior.

3.11.3.57.3.3.27  (01-01-2008)
Line 47—ES Penalty

  1. Edit CCC "P" on tax year 1993 and 1992 returns when either of the following conditions are present:

    • Box 1e or 1f on Form 2210 is marked

    • "Modified AGI" is written by line 47 or on Form 2210

    Note:

    These two conditions are to be used in addition to the current year conditions for editing CCC "P" .

  2. Follow current year procedures for editing CCC "P" for all other prior tax year returns.

3.11.3.57.3.4  (01-01-2008)
Form 1040A Forms and Schedules

  1. Use the instructions below for editing prior year Form 1040A forms and schedules.

3.11.3.57.3.4.1  (01-01-2008)
Schedule 1-Interest and Ordinary Dividends

  1. For tax years 2006 through 1990 take the following actions:

    1. "X" the Schedule 1 unless there is an entry on line 3.

    2. Do not edit gross interest or dividends.

  2. "X" the Schedule 1 when the tax year of the return is 1989 or prior.

3.11.3.57.3.4.2  (01-01-2008)
Schedule 2-Child and Dependent Care Expenses

  1. Follow prior year Form 2441 instructions for tax years 2001 through 1983 found in IRM 3.11.3.57.3.1.4.

  2. Change the Schedule number from "Schedule 1" to "Schedule 2" for tax years 1989 through 1983.

  3. "X" the schedule when the tax year of the return is 1982 or prior.

3.11.3.57.3.4.3  (01-01-2008)
Form 8913 - Credit for Federal Telephone Excise Tax Paid

  1. "X" Form 8913 when it is attached to other than a TY06 return.

3.11.3.57.3.5  (01-01-2008)
Form 1040EZ

  1. Follow the guidelines in IRM 3.11.3.57.1 for editing the following return information:

    1. Tax period

    2. Received date

    Note:

    The editing instructions for current year Forms 1040EZ are covered in IRM 3.11.3.55.

  2. Certain conditions on a prior year Form 1040EZ may require it to be converted to a Form 1040. These conditions are identified in IRM 3.11.3.55.1.1. In addition to those conditions, convert a prior year Form 1040EZ when either of the following conditions is present:

    • The tax period of the return is prior to 8212.

    • The tax period is 9212 or prior and the FS is "2" .

      Note:

      Married filing joint returns can be determined by the presence of two names in the caption.

  3. Edit unemployment compensation to line 3 of Form 1040EZ when the tax year is 1994 or prior.

  4. Use the following chart to determine the correct editing of the Dependency Status Indicator.

    If the tax year is Then