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Part 3. Submission Processing

Chapter 11. Returns and Documents Analysis

Section 6. Data Processing (DP) Tax Adjustments (Cont. 1)

3.11.6  Data Processing (DP) Tax Adjustments (Cont. 1)

3.11.6.4  (01-01-2008)
Screening Criteria for Processable Return

  1. Before inputting any changes to a Form 1040X, check for the issue(s), freeze codes, transaction codes, math error condition, tax period, etc. that require routing to another area.

    Note:

    If there is no TC 150 posted on a Current or Prior Year module, "G Code" the Form 1040X.

  2. If the return is not routed to another area, then check for the following items that may require correspondence or additional action:

    • Primary TIN

    • Tax period

    • Signature

    • Received date

    • PECF boxes checked requiring preparation of a dummy return

    • Missing forms, schedules or other required information

3.11.6.4.1  (01-01-2008)
Signature

  1. All processable claims require a valid signature(s). The signature(s) is required anywhere below the jurat (perjury statement) on Amended returns and CP 27 Notices.

  2. If the jurat has been altered, treat it as a Frivolous claim. If the jurat is missing, treat it as an unsigned return and correspond for the missing signature(s) using a 324C Letter to obtain the signature. Do not mail the return back to the taxpayer. (See IRM 3.11.6.8(9) Box 31)

  3. "Correspond" for an original signature only when signature can be clearly determined to be a photocopy.

  4. If Form 1040X is not signed, however a Form 1040 matching Column C of Form 1040X is attached and signed, accept the signature and continue processing the return. Edit "see 1040" onto the signature line of the Form 1040X.

  5. Correspond for the signature of two witnesses when the taxpayer signs with a mark such as an "X" . See IRM 3.11.6.8(9) Box 30.

  6. Faxed signatures are acceptable for Amended returns, CP 27 Notices, and Form 2848 only if you are speaking to the taxpayer or authorized representative and the following steps are taken:

    1. Validate that you are speaking to the taxpayer or authorized representative.

    2. Advise the taxpayer that the faxed signature will become a permanent part of the tax return.

    3. Fax the jurat to the taxpayer or authorized representative and attach the returned fax to the return.

  7. Joint returns require the signature of both taxpayers unless one of the taxpayers is:

    1. Divorced (net zero or tax increase only). For tax decreases/credit increases, refer as CIS/AM.

    2. Spouse overseas and signing spouse is authorized by a power of attorney (e.g. Form 2848) or similar signed document which clearly defines the scope of authorization granted to the POA.

    3. Spouse in combat zone/qualified hazardous duty area and signing spouse attached statement. Route Combat Zone returns to CIS/AM

    4. Spouse of an incapacitated spouse. The signing spouse should attach a dated statement explaining reason the incapacitated taxpayer cannot sign.

      Note:

      Any indication the Primary or Secondary spouse is deceased (filing as surviving spouse), route to CIS/AM.

  8. If the taxpayer is a minor (there must be a clear indication the child is a minor) the return must be signed by one of the following:

    1. The minor child

    2. A parent

    3. A guardian or other fiduciary representative and the refund under $100.

    4. A guardian or other fiduciary representative with documentary evidence is attached.

    5. If none of the above applies, correspond for a missing signature. See IRM 3.11.6.8(9) Box 27

      Examples of documentary evidence includes :

      • Any court papers naming the claimant as a court appointed or court certified personal representative for the estate
      • A will validated through the court
      • A completed Form 1310
      Examples of Fiduciary representatives includes :

      • Administrator (ADM)
      • Conservator (CONS)
      • Custodian (CUST)
      • Executor (EXEC)
      • Guardian (GDN)
      • Personal Representative (PER REP)
      • Trustee (TR)

  9. Do not correspond for a missing/incorrect signature(s) if:

    1. The return meets "route-out" criteria

    2. Any "Dummy" return that was prepared by the IRS

    3. A fiduciary representative or parent for other than a minor child signs for a refund under $100

    4. An incompetent taxpayers return is signed by a parent or spouse

    5. The return is signed by an attorney, CPA, or representative of a bank/fiduciary institution (credit unions, pension funds, etc.)

    6. Deceased or Combat Zone returns, refer as CIS/AM.

    7. If the signature on the return is not the same as the taxpayer see IRM 3.11.6.4.2.

    8. If Form 2848 with Part II completed and is attached to the return.

      Note:

      Do not confuse attorney with Power of Attorney or Attorney-in-fact.

3.11.6.4.2  (01-01-2008)
Centralized Authorization File (CAF)-Form 2848(POA) and Form 8821(TIA) and General /Durable POAs

  1. Taxpayers will occasionally submit a tax return that has been signed by their enrolled agent, or some other representative. These personal representatives of the taxpayer must submit a Form 2848 (Part II completed), or acceptable General/Durable POA or already be on file with the Centralized Authorization File (CAF) in order to sign the taxpayers return.

  2. Taxpayers may also submit a Form 8821, Tax Information Authorization and Declaration of Representative (TIA) as documentary evidence for signing the tax return; however, Form 8821 does not authorize the signing of the return. Correspond for a Form 2848 if the taxpayer submits a Form 8821.

  3. Any form used in lieu of Form 2848 such as a General/Durable Power of Attorney must contain the following information to be considered acceptable for CAF processing and should be detached and routed to the CAF unit:

    1. Name, Taxable Identification Number (TIN), and address of the taxpayer

    2. Name and address of the designated representative

    3. Specific action to be performed (authorizes representative to inspect and/or receive confidential tax information, act on the taxpayers behalf for tax purposes, sign the return, etc).

    4. Type of tax (individual)

    5. Tax Year(s) or Period(s)

    6. Taxpayers signature and date

  4. Often, General or Durable Power of Attorney documents do not contain all requirements as stated in (3) above; however, the Conference and Practice requirements allow the IRS to accept these documents if they expressly provide that the designated person may prepare, execute and file the tax return or has similar language.

    Note:

    General references such as "all tax matters" , "deposits and withdrawals from financial institutions" , "real estate transactions" , etc. do not make it acceptable for CAF to process.

  5. In addition to General/Durable POAs or any "acceptable" document, a statement of "good standing" or a Form 2848 (with Part II completed) is required to be acceptable for CAF processing.

  6. When the taxpayer only submits a General/Durable POA, no Form 2848 (with Part II completed), and no "good standing" statement, it is not "acceptable" for CAF processing. Leave the document attached to the return and continue processing.

  7. If the taxpayer includes a Form 2848 with Part II signed or provides one of the statements outlined in (8) below, route the POA, and/or Form 2848 or the attached "good standing" statement to the CAF unit.

  8. The Good Standing statements are described as:

    1. If the POA is granted to an attorney, CPA enrolled agent or enrolled actuary, a declaration of good standing before the Service must be signed by the representative. If the POA is not present, correspond.

    2. If the POA is granted to a person other than one listed in (a), the POA must include the signature and date of two disinterested witnesses, or acknowledgment of a notary public.

  9. Use CC CFINK to research the CAF to verify the personal representative is authorized to sign the return for the tax period indicated.

    If... And... Then...
    The signature on the return matches a representative listed on CFINK   Continue processing the return.
    The signature on the return does not match a representative listed on CFINK, or no record is found Form 2848 is attached
    1. Detach from Form 1040X and route to the nearest CAF unit.
    2. Continue processing the amended return.
    3. Leave an action trail on the amended return and Form 2848.
    Form 2848is not attached Correspond for Form 2848.

    Note:

    If Line 4 of Form 2848 or Form 8821 is checked, do not detach or route to the CAF unit. Continue processing the return.

  10. Use the following addresses when routing or faxing a Form 2848, Form 8821, or "acceptable" General/Durable POA to a CAF Unit:

    CAF Unit Fax Numbers Address
    Memphis
    901–546–4115
    Internal Revenue Service
    5333 Getwell Rd.
    Stop 8423
    Memphis, TN 38118
    Ogden
    801-620-4249
    Internal Revenue Service
    1973 N Rulon White Blvd
    Mail Stop 6737
    Ogden UT 84404
    Philadelphia
    215-516-1017
    Internal Revenue Service
    11601 Roosevelt Blvd
    DPSW 312
    Philadelphia, PA 19255

  11. You may accept a fax of Form 2848 if you are in telephone contact (in lieu of corresponding on Form 8009 or 324C letter) with a taxpayer to secure missing schedules or forms, or gathering information to make a return processable. Forward the Form 2848 to the CAF unit for processing, once completed.

  12. Do not detach any "Worksheets" provided by the military to personnel assigned to a Combat Zone. They are not considered to be a POA in lieu of Form 2848. See IRM 3.11.6.3.16.

  13. If correspondence is attached to the return that is unrelated to the amended return, but needs to be detached and routed to the appropriate functional area, attach a photocopy of the POA/TIA to the correspondence. Indicate that the form has been detached and routed to the CAF unit.

3.11.6.4.3  (01-01-2008)
TC 971 and Action Codes

  1. A TC 971, when input with one of the action codes 012 through 015 shown in (2) below, indicates the taxpayer filed an amended return and begins an action trail for the document. The action code indicates where the return was routed. Since this action generates a TC 977 on master file and a "—A or E—" freeze on IDRS, the Received Date of the Form 1040X must be input for the transaction date. For Action Code 270, the current date is entered when mailing a refund return back to the filer. Do not enter an action code if you are only routing correspondence or form attached to a Form 1040X.

  2. The action codes used by Code and Edit in conjunction with TC 971 are as follows:

    ACTION CODE DESTINATION
    012 Collection (When routing the entire return)
    014 Statute function
    015 Underreporter function
    065 Form 8857, Request for Innocent Spouse Relief (and Separation of Liability and Equitable Relief) filed. Route to Covington, KY.
    071 Form 8379, Injured Spouse Claim and Allocation. Input Action Codes 010 and 071.
    270 Amended return sent back to the taxpayer for additional information. Enter the current date as TRANS-DT.

  3. When you input TC 971 with the appropriate action code:

    1. Notate in the upper left margin of the document that TC 971 was input and the date of input.

    2. Edit the tax period if it is missing. See IRM 3.11.6.2.2.

  4. When a TC 150 has not posted:

    If Then
    It is a Disaster return, Follow local procedure for expedite routing to CIS/AM. See IRM 3.11.6.3.14
    It is not a Disaster return, Follow "G-Code" procedures. See IRM 3.11.6.5.1

3.11.6.4.4  (01-01-2008)
Claims Returned from Other Areas

  1. Occasionally, claims that were routed to another function may be returned for processing.

  2. Determine if the return requires:

    • Routing to the next highest priority

    • Additional research

    • Input (the return has been cleared from the area/function it was routed )

      Note:

      Claims that were routed out by the input of a TC 971 may generate a TC 977 on the module. If a TC 977 is posted, refer to Accounts Management.

3.11.6.4.4.1  (01-01-2008)
Forms 1040 Attached to Form 1040X

  1. Sometimes the 1040X Unit will receive Forms 1040 attached to Form 1040X. Determine if the attached Form 1040 and Form 1040X is for the same or different tax period.

  2. Research for a TC 150 for the tax period indicated on the return. If the figures on the return or the data on IDRS support a different tax period for either the Form 1040 or Form 1040X, edit the correct tax period onto the appropriate return.

    Note:

    If the tax period is missing, use these same instructions for determining the appropriate tax period. If unable to determine the correct tax period, G-code the return as a current year return.

  3. If no TC 150 has posted on TXMOD/IMFOL for the same tax period, research TRDBV.

    1. If the tax data is present, X Form 1040 and staple behind Form 1040X, G-Code Form 1040X.

    2. If the tax data is not present, take the action based on the procedures in the table in (6) below.

    3. If a TC 594 is present, research for the TC 150 using the spouse's TIN:

      1. If present, continue processing the return.
      2. If not present, route to Receipt and Control.

  4. Route the 1040X to CIS/AM if it meets that criteria.

  5. If the Form 1040 is for a different tax period than the Form 1040X and:

    1. Form 1040 is being used as "support" for a carryback loss, keep the two returns together and treat as a carryback/carryforward claim.

    2. No TC 150 has posted for the tax period of Form 1040, detach Form 1040. Continue processing Form 1040X.

  6. If no TC 150 has posted for the same tax period, take the following action based on the chart below.

    If Then
    Form 1040 matches Column A of Form 1040X, "As originally filed"
    1. Detach Form 1040
    2. "G-Code" Form 1040X
    3. Edit "No TC 150" in the upper left margin of Form 1040 and route to Receipt and Control to be processed as an original return.
    4. If Form 1040 is not signed, but Form 1040X is signed, edit a "CCC 3" in the upper portion of the Filing Status area of Form 1040 prior to routing to Receipt and Control. If both returns are missing a signature, correspond.
    Form 1040 matches Column C of Form 1040X, "As amended"
    1."X" Form 1040X and staple behind Form 1040. Edit "No TC 150" in the upper left margin.
    2. Route to Receipt and Control to be processed as an original.
    3. If Form 1040 is not signed, but Form 1040X is signed, edit a "CCC 3" in the upper portion of the Filing Status area of Form 1040 prior to routing to Receipt and Control.
    Two Forms 1040 are attached to Form 1040X:
    1. One will be notated "As originally filed" and matches Column A of the attached Form 1040X.
    2. The second will be notated "As amended" and matches Column C of the attached Form 1040X.
    1. Detach the "As originally filed" Form 1040, edit "No TC 150" in the upper left margin and send to Receipt and Control.
    2. If the Form 1040 "As Originally Filed" is not signed, but the Form 1040X is signed, edit a "CCC 3" in the filing status section of the Form 1040.
    3. "X" the "As amended" Form 1040 and staple behind the Form 1040X. "G-Code" the Form 1040X and send to Receipt and Control for processing.

    Note:

    If routing a Form 1040 to Receipt and Control that was received after ≡ ≡ ≡ ≡ ≡ ≡ and the Received Date is missing, edit the Received Date from the Form 1040X onto the Form 1040.

  7. If a TC 150 has posted for the same tax period, take the following action based on the chart below. Determine which column of the Form 1040X matches the figures on Form 1040.

    If Then
    Form 1040 matches Column A of Form 1040X, "As originally filed"
    1. "X" Form 1040 and staple behind Form 1040X.
    2. Continue processing Form 1040X.
    Form 1040 matches Column C of Form 1040X, "As amended" ,
    1. "X" Form 1040 and staple behind Form 1040X.
    2. Continue processing Form 1040X.

    Note:

    If Form 1040X is not signed and Form 1040 is signed, do not "X" Form 1040. Edit "Do not process" in the top margin of Form 1040. Edit "1040 signed" on the signature line of Form 1040X.

3.11.6.4.4.2  (01-01-2008)
E-file Documents: Form 8453 - U.S. Individual Tax Declaration for an IRS E-file Return, Form 8879 - IRS E-file Signature Authorization or Letter 2936-A Attached to Form 1040X

  1. There may be cases in which the taxpayer will attach one of the following forms to the Form 1040X. Follow the procedures in the table below if applicable.

    IF AND THEN
    The Form 8453, 8879 or Letter 2936-A is attached to the Form 1040X   Detach the Form 8453, 8879 or Letter 2936-A and route to E-file for processing.
    The Form 8453, 8879 or Letter 2936-A is attached to the Form 1040 Annotations such as "Copy" , "Duplicate" , etc. on the Form 1040 and the amounts are thesame on both forms "X" out the Form 1040 and staple behind the Form 8453, 8879 or Letter 2936-A and route to E-file for processing.
    The Form 8453, 8879 or Letter 2936-A is attached to the Form 1040 Annotations such as "Copy" , "Duplicate" , etc on the Form 1040 and the amounts are different on both forms Route the Form 1040 to CIS/AM as an amended return and route the Form 8453, 8879 or Letter 2936-A to E-file for processing.

3.11.6.4.4.3  (01-01-2008)
True Duplicate Returns

  1. A true duplicate condition occurs when the taxpayer files two 1040 series returns for the same tax year. Often the taxpayer will send in a Form 1040/A/EZ with a notation of "Duplicate" , "Copy" , "Substitute" , "Amended" , "Corrected" , "Revised" , "Superseding" , or "Tentative" , or attaches a copy of a previously filed return.

  2. Research using CC's TXMOD, IMFOL, RTVUE or TRDBV for a TC 150 for the tax year of the return. If the figures or data from TXMOD support a different tax period, circle out the incorrect tax period and edit the correct tax period onto the return.

    1. If no TC 150 has posted, circle out any notation that suggest the return was previously filed. Edit "No TC 150" in the upper left margin and send to Receipt and Control to be processed as an original return.

    2. If a TC 150 has posted, determine if the Form 1040 is a copy of the original filed return or is an"amended" return. (See (3) below).

      Note:

      If correspondence is attached, route the return to the appropriate area based on the correspondence.

    3. If no TC 150 has posted and a TC 594 is present, research TXMOD using the spouse's TIN. If present continue processing the return; otherwise route to Receipt and Control.

  3. When a TC 150 has posted, research IDRS for any differences between RTVUE and the Form 1040. Compare the following items and process accordingly:

    • Entity information (name and address)

    • Filing Status

    • Exemptions (dependents claimed and money amount)

    • Standard Deduction and Itemized Deductions

    • Line -by- line comparisons (income, deductions, credits, other taxes, payments, penalties, etc.)

    • Direct Deposit information (account/routing numbers use CC TRDBV to research)

      Note:

      If any normal "route out" criteria are present, take appropriate action. (i.e. Combat Zone, Deceased, etc.)

  4. If a change has been discovered, refer as CIS/AM.

    Exception:

    Accounts with "SUBST4" on IMFOL or SFR on TXMOD should be routed to Collections. (See IRM 3.11.6.3.11(2))

  5. If there are no changes, the return is a True Duplicate return. Research the return packet for any correspondence that would indicate why the taxpayer is submitting a duplicate filing.

    1. If the taxpayer explains the return is a copy and some additional action is being requested, refer to AM or appropriate area.

    2. If the taxpayer explains the return is a "copy" and no additional action is required, identify as classified waste by marking the return as determined by local management.

    3. If no explanation given, input a TC 290.00, Category "XRET" , and no Reason/Sources codes. In the "Remarks" area input "TRUE DUPE" .

      Note:

      If a signature is missing, continue processing as a True Duplicate return and do not correspond.

3.11.6.5  (01-01-2008)
Forms 1040X Processed through ISRP Input

  1. The following returns may be prepared or edited by the 1040X Unit for input through the ISRP system instead of IDRS:

    1. PECF "Dummy" returns when the filer has checked one or both boxes in Part III on the Form 1040X. See IRM 3.11.6.2.4.

    2. "G-Coded" returns when no TC 150 has posted to a current or prior year module. See IRM 3.11.6.5.1

    3. An "original" return is prepared by IRS from data shown on a Form 1040X when no TC 150 has posted for a statute return. The 1040X unit will convert the Form 1040X to a Form 1040 and route to Statutes instead of ISRP. See IRM 3.11.6.3.2.

  2. To release returns processed through ISRP, a transmittal to Receipt and Control is prepared and Program Code 44400 for the "G-Coded" and "Dummy PECF" returns is notated. Any return that is sent to Code and Edit to be processed as an original will be blocked in the correct series by Receipt and Control function.

3.11.6.5.1  (01-01-2008)
Editing "G-Code" Returns

  1. Always "G-Code" Form 1040X when no TC 150 has posted to IMFOL/TXMOD and no Form 1040/A/EZ is attached.

    Exception:

    Do not G-Code Disaster claims when no TC 150 has posted. See IRM 3.11.6.3.14(15).

  2. Edit the following for "G-Coded" Form 1040X returns: (See Figure 3.11.6–5 G-Coding Form 1040X)

    1. Perfect the primary TIN, if needed.

    2. Edit or underline the prior year tax period in YYMM format.

    3. Underline the primary name control.

    4. Edit the filing status code based on the box checked from Part B on this return (Part C on prior revision) to the right of Line A.

    5. Edit the received date (if not stamped).

    6. Enter your employee number/stamp in the upper left corner of the return.

    Figure 3.11.6-5

    This image is too large to be displayed in the current screen. Please click the link to view the image.

  3. If the address is an APO/FPO, see IRM 3.11.6.6.2.

  4. Instruct Batching and Numbering to use Program Code 44400 for ISRP input. Refer to Exhibit 3.24.3-59 for the ISRP input fields for Intermediate Entity.

3.11.6.6  (01-01-2008)
Processing Forms 1040X Using IDRS for Input of Adjustment

  1. Manually screen the Form 1040X for CIS/AM, CAT A, Statute, Fraud Detection Center criteria, notices or correspondence that indicate another function is working on the case for "routing out" .

  2. Research IDRS for any Transaction or Freeze Codes that require special attention.

  3. Once you have determined that there are no "route out" criteria, input the adjustment through IDRS. See the items covered under IRM 3.11.6.4, Screening Criteria for Processable Return, and corresponding for any missing information per IRM 3.11.6.8, Correspondence Procedures for further explanation.

  4. The following subsections cover:

    • Address and Filing Status Changes

    • Perfecting Amended Returns With APO or FPO Addresses

    • Manual Refund

    • Master File

    • Math Verification

    • Setting A Math Error

    • Transaction Codes and Reference Numbers

    • IMF Source Codes

    • IDRS Transaction Codes and Freeze Codes

    • Unpostable Codes

3.11.6.6.1  (01-01-2008)
Address and Filing Status Changes

  1. Process address changes as follows:

    If And Then
    If the "Yes" Box is checked on Line A on Form 1040X, or
    taxpayer alters the address in the Entity of the Form 1040X, (See Figure 3.11.6-6)or
    taxpayer specifically indicates in Part II or on a separate sheet, or Form 8822 is attached     		IDRS (CC ENMOD) does not reflect the change indicated on the return.
    (If CC ENMOD is unavailable, research CC INOLE).     		Use CC INCHG to update the entity and edit "INCHG" in the left margin of the return.

    Note:

    If the Form 1040X, Line A contains a "YES" or "NO" box, do not update the Entity if the "No" box is checked and TP alters the address.

    Note:

    If the filer used Form 1040X instead of Form 8822 to inform us of an address change and there is no tax adjustment, input a TC 290.00, Reason Code 099, Source Code 1. Do not input a TC 971 to indicate an amended return on the module. Use CC INCHG to update the address.

    Figure 3.11.6-6
    This image is too large to be displayed in the current screen. Please click the link to view the image.

  2. Use the following chart when making a filing status change:

    If the taxpayer changes the filing status on Form 1040X to: And on Line 4 Then
    FS 1 (single)   Update INCHG to FS. Use RC 001.
    FS 2 (married filing jointly)   Refer to CIS/AM.
    FS 3 (married filing separately)   Refer to CIS/AM
    FS 4 (head of household) The taxpayer is claiming:
    1. A dependent exemption (name/TIN matches INOLE)
    2. A non-dependent (name and QND are provided)
    3. Any of the information in 1 or 2 is missing or does not match     		1. Update INCHG to FS 4. Use RC 004.
    2. Update INCHG to FS 7. Use RC 004.
    3. Correspond
    FS 5 (qualifying widower)   Refer to CIS/AM.

    Note:

    Input a Posting Delay Code "2" on the CC INCHG screen.

  3. If the taxpayer indicates a change in filing status that is not an CIS/AM issue, input the change on IDRS using CC INCHG. Edit "INCHG" in the left margin of the return.

    Note:

    When making any entity changes along with adjustments, you must do a cycle delay.

  4. If a Form 1040X is received requesting a filing status change, and a TC 971 AC 137 is present on the module, route to CIS/AM.

  5. Do not input any name changes. Taxpayers are required to do this through SSA. Exception: If there is a clear indication that the Name Control was transcribed incorrectly (e.g. SMITH as transcribed as SMTH), input the correction. If the taxpayer files a Form 1040X only to indicate a name change with no tax information changed, check INOLE for NEW SSA/NC. If present, input TC 290.00 and route the return to Files. If not present, route the return to Entity with a Buck Slip attached. Annotate "Name change request-do not process 1040X" .

  6. See IRM 3.11.6.6.3 for Manual Refund instructions if the filer REQUESTS a refund to be issued in another name.

3.11.6.6.2  (01-01-2008)
Perfecting Amended Returns with APO or FPO Addresses

  1. "APO" or "FPO" must appear as the city, followed by the appropriate two character state code (AA, AE or AP) in the city and state area, followed by the corresponding unique five digit zip code (34001, 09001, or 96201) on the City, State, Zip Code line. These "editing" instructions would only apply when preparing a return for ISRP input.

  2. If a city name/foreign city or foreign country name is present, circle them. Edit the appropriate APO or FPO state and zip code based on the following chart.

    OLD APO/FPO ADDRESS NEW APO/FPO ADDRESS
    APO or FPO Miami, FL APO or FPO AA 34001
    APO or FPO New York, NY APO or FPO AE 09001
    APO or FPO San Francisco, CA APO or FPO AP 96201
    APO or FPO Seattle, WA APO or FPO AP 96201

  3. If the zip code or state code is missing, edit the appropriate one(s) using the chart above. For example, if the address is written "APO San Francisco 96201" , circle "San Francisco" and edit "AP"

    Example:

    If the state code is AP, and zip code is missing edit 96201.

  4. When correspondence is required do not send the return back to the taxpayer.

3.11.6.6.3  (01-01-2008)
Manual Refund

  1. Route cases to the Accounts Management Adjustment function for a Manual Refund if:

    1. The taxpayer requests the refund issued in a name other than shown on master file.

    2. The taxpayer requests the refund issued to an address other than shown on master file. Example:Temporary Address or a c/o Address that is different or not shown on master file.

    3. Refund is less than one dollar.

    4. Refund is $10 million or more.

3.11.6.6.4  (01-01-2008)
Master File Verification

  1. Master file verification is required on all amended returns prior to:

    • Inputting an adjustment

    • Initiating correspondence

      Exception:

      Master File Verification is not required when corresponding for a missing tax period or TIN, or when a return has been perfected as stated in IRM 3.11.6.1.2.1

  2. Master file verification requires, but is not limited to, the comparison of the Adjusted Gross Income (AGI-Line 1), Taxable Income (TXI-Line 5), and Total Tax (TC 150 -Line 10) on Form 1040X, in Column A with IMFOL or TXMOD.

    1. If Line 10, Column A matches TXMOD, but Lines 1 through 5, Column A are blank, incomplete, or contain misplaced entries, edit the correct Column A entries from TXMOD/RTVUE onto Form 1040X.

    2. If Line 1, 5 and 10, Column A or any combination of these lines does not match TXMOD and no math error (MTH-ERR) is present, math verification is required

  3. If during master file verification a math error indicator (MTH-ERR) is found on IDRS and:

    1. Lines 1, 5 and 10, Column A match TXMOD/IMFOL, continue processing the return. Use Priority Code 8 to bypass the math error condition. Disaster claims requiring a Priority Code 8 are to be referred to AM.

    2. Lines 1, 5 and 10 Column A do not match TXMOD/IMFOL, refer as CIS/AM.

3.11.6.6.5  (01-01-2008)
Math Verification

  1. Math verification is required when:

    1. There is the total tax change (positive or negative) or ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    2. Column A entries do not match TXMOD or IMFOL (no math error code is present)

      Note:

      If the error is due to a misplaced entry or is off by $1 because of rounding, do not math verify.

  2. Math verification includes doing the following:

    1. Verifying that the math on the entire Form 1040X, forms, schedules, worksheet that are related specially to any change.

    2. Verifying that Column B and C entries are based on the attached forms, schedules, worksheets, taxpayer remarks, and IDRS research.

    3. Verifying the tax computation on Line 6, Column A and C.

    4. Checking all additional taxes (SE tax, early withdrawal penalty on IRA distribution, etc.) to determine the correct increase/decrease tax.

      Note:

      If you are unable to math verify the return based on information submitted and/or through IDRS research, refer as CIS/AM.

  3. When math verifying the return and an error is discovered, re-compute Columns A, B and C using the information supplied and IDRS research. After "perfecting" the Total Tax on Line 10 Column C and:

    1. The difference between the taxpayers Line 10 Column B amount and your recomputed Line 10 Column B amount is≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , adjust the account using the taxpayers figures.

    2. The difference between the t