3.11.3  Individual Income Tax Returns

Manual Transmittal

November 07, 2014

Purpose

(1) This transmits revised IRM 3.11.3, Returns and Documents Analysis - Individual Income Tax Returns - Code and Edit.

Material Changes

(1) Updated All calendar dates.

(2) References to line numbers have been updated to reflect current year forms and schedules.

(3) Instructions have been updated throughout for clarity.

(4) Mileage rates updated throughout.

(5) Social Security amounts updated throughout.

(6) Earned Income Credit amounts updated throughout.

(7) IRP data may be available as early as February and not June was updated throughout the IRM

(8) Direct Deposit -- Edit a checkmark to the left of the direct deposit area when "numeric" entries are present -- Added numeric throughout the IRM.

(9) IRM 3.11.3.3.4 -- Added Form 8962 (Sequence 73 and 74) and Form 8965 (Sequence 75) to the list of Sequence of Transcribed Schedules and Forms.

(10) IRM 3.11.3.4.2.5 -- Added a new (2) to bracket a negative amount on the Correspondence sheet under bracketing.

(11) IRM 3.11.3.4.3(2) -- Added an Exception that C&E is not required to draw a vertical line when column(s) are not present and the dollar and cents have been separated by a decimal.

(12) IRM 3.11.3.5.2.1(1) -- Added with the word received for an IRS Campus Date Stamp.

(13) IRM 3.11.3.5.7(3) (Reasonable Cause) -- Removed taxpayer abroad or overseas from the CCC "N" criteria.

(14) IRM 3.11.3.6.2.2(4) -- Updated the paragraph reference from "n" to "u" for Form 6001.
(4 - Exception) -- Updated the paragraph reference from "n" to "u" for Form 6001.

(15) IRM 3.11.3.6.3.3 (Correspondence Action Chart) -- Added Line 9 and Line 19 for Schedule A.

(16) IRM 3.11.3.7.1.4(4) -- Added "UCC 1-308" to examples of Frivolous Returns.

(17) IRM 3.11.3.7.19 -- Added new Identity Theft subsection to Special Situations and Returns.

(18) IRM 3.11.3.7.1.5(3) -- Removed the reference to the Administrative Reference Guide (IRM 3.0.273).

(19) IRM 3.11.3.7.2.8 -- Added a new subsection for Form 8938, Statement of Financial Assets.

(20) IRM 3.11.3.7.2.10 (Innocent Spouse Relief Request, Form 8857) -- Changed all references from claimant or taxpayer to electing spouse.

(21) IRM 3.11.3.7.2.10 (5) (Innocent Spouse Relief Request, Form 8857) -- Updated the mailing address.

(22) IRM 3.11.3.8.2 (Current Calendar Year Return) -- Added a new instruction.

(23) IRM 3.11.3.10(1) (Decedent Returns) -- Added "DEC" as an indication of a deceased taxpayer.

(24) IRM 3.11.3.10.1(7) -- (Decedent Return, General Procedures) -- Added a literal to use when corresponding on Form 6001

(25) IRM 3.11.3.10.4(2) -- (Name Line on a Decedent Return) -- Added a Note, that no special editing is required if a suffix is present on a joint return.

(26) IRM 3.11.3.12.2.1(1) -- Filing Status Box 1 marked, added a correspondence literal to use to the 2nd "Then" Box.

(27) IRM 3.11.3.14.1(3) -- Added Identity Theft to the Special Situations Table.

(28) IRM 3.11.3.14.2.1 (Line 7 Wages - Noted by the Taxpayer) -- Added Foreign Employee Compensation (FEC).

(29) IRM 3.11.3.14.2.6(1) (Line 12 - Business Income or Loss) -- Added actual IRM instructions to dummy the Schedule and removed the IRM reference.

(30) IRM 3.11.3.14.2.12(1) (Line 18 - Farm Income or Loss) -- Added actual IRM instructions to dummy the Schedule and removed the IRM reference.

(31) IRM 3.11.3.4.2.14(1a) -- (Lines 20a & 20b - Social Security Benefits) -- Corrected the box number to use on the Form SSA-1099 from 3 to 5.

(32) IRM 3.11.3.14.3.1, Line 23 -- Changed Educator Expenses to Reserved.

(33) IRM 3.11.3.14.3.6(1) (Line 28 - Self-Employed SEP, SIMPLE) -- Added Schedule C-EZ to list of when to "X" line 28.

(34) IRM 3.11.314.3.8 (1) (Line 31a and 31b - Alimony Paid and Alimony Recipient’s TIN) -- Removed the original instructions and added new procedures for any amount claimed on line 31a.

(35) Removed Figure 82.

(36) IRM 3.11.3.14.3.10, Line 34 -- Changed Tuition & Fees (Form 8917) to Reserved.

(37) IRM 3.11.3.14.4.3(1b) (Line 40 - Standard or Itemized Deductions) -- Updated the Standard Deduction table with the new amounts for 2014 returns.

(38) IRM 3.11.3.14.4.6 -- Added a new subsection for Line 36, Premium Tax Credit (PTC).

(39) IRM 3.11.3.14.5.1(1) (Line 48 - Foreign Tax Credit, Form 1116) -- Revised the tolerance from more than $600 to more than $300 (more than $600 for FS 2).

(40) IRM 3.11.3.14.5.1(1) (Line 48 - Foreign Tax Credit, Form 1116) -- Added to correspond for Form 1116 when there are no significant entries are present or edited on lines 7, 22 or 30.

(41) IRM 3.11.3.14.5.1(2) (Line 48 - Foreign Tax Credit, Form 1116) -- Added an additional instruction that if there is no amount on line 22, edit from line 7 or line 8 of Form 1116.

(42) IRM 3.11.3.14.5.7 (1) (Line 54 - Other Credits) -- Added a bullet list in the Then column (last row of the table) for when there is no supporting documentation is attached and line 54 shows any dollar amount.

(43) IRM 3.11.3.14.6.2(1) (Line 58 - Social Security and Medicare Tax on Unreported Tip Income (Forms 4137 and Form 8919) -- Added another "IF" box criteria to include indicators A, B, M and N on an attached W-2.

(44) IRM 3.11.3.14.6.5 -- Added a new Subsection for Line 61 - Full Year Coverage.

(45) IRM 3.11.3.14.7.1 (Line 64 - Withholding) -- Revised money amounts and added Form 8959 to the table.

(46) IRM 3.11.3.14.7.1(2 Note) (Line 64 - Withholding) -- Clarified the definition of a "single supporting document" .

(47) IRM 3.11.3.14.7.3 (Line 66a - Earned Income Credit) -- Revised the AGI amounts for claiming EIC.

(48) IRM 3.11.3.14.7.7 -- Added a new Subsection for Premium Tax Credit - Form 8962.

(49) IRM 3.11.3.14.7.11 (Line 73 - Other Payments) -- Removed Form 8885.

(50) IRM 3.11.3.14.12 (Identity Protection Private Identification Number (IP PIN) -- Changed the word from Private to Personal.

(51) IRM 3.11.3.15.3 -- Added a new Subsection for Line 8, Other Taxes - Schedule A.

(52) IRM 3.11.315.8 (3 and 4) (Lines 16, 17, 18, and 19 - Gifts to Charity) -- Revised correspondence instructions.

(53) IRM 3.11.3.15.10 (2 b) -- Updated the paragraph reference from (L) to (E) for Form 6001.

(54) IRM 3.11.3.23.1 (Form 1116, General Procedures) -- revised the instructions and tolerance amounts.

(55) IRM 3.11.3.25.7 (Form 2441, Lines 4 and 5 - Earned Income) -- Added a new (2) for when lines 4 and 5 have entries and line 5 is equal to line 4.

(56) IRM 3.11.3.26.1(7b) (Form 3800, General Information) -- Added the literal to use when corresponding for the NPS Certificate (Form 3468).

(57) IRM 3.11.3.27.1(4) (Form 4136, General Procedures) -- Changed the instruction from send to Exam to edit Unallowable "85" idf the amount is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

(58) IRM 3.11.3.38.2 (Archer MSA Instructions (Section A) -- Added a new (3) to edit RPC "U" when "Death of MSA Account Holder" is present at the top of Form 8853.

(59) IRM 3.11.3.41.14(4) (Loose Schedule H) -- Added to the "And" Column (rows 2 and 6) signature is other than the taxpayer's and no documentary evidence is attached.

(60) IRM 3.11.3.49 -- Changed the title of Form 5405 from "First-Time Homebuyer Credit and Repayment of the Credit" to "Repayment of the First-Time Homebuyer Credit" .

(61) IRM 3.11.3.49(3) -- Changed the paragraph form "W" to "R" for Form 6001 when corresponding.

(62) IRM 3.11.3.49(5) -- Added to use paragraph "N" when corresponding on Form 6001.

(63) IRM 3.11.3.49(6) -- Removed Note to edit Disposition Code "I"
(6) -- Updated the paragraph reference from "T" to "N" for Form 6001.

(64) IRM 3.11.3.49(10) -- Deleted the correspondence instruction and changed it to "Take No Action" when multiple boxes are checked on line 3.

(65) IRM 3.11.3.49(11) -- Changed the paragraph form "S" to "N" for Form 6001 when corresponding.

(66) IRM 3.11.3.49(13) -- deleted the paragraph and the note.

(67) IRM 3.11.3.52 -- Changed the title for Form 8958 from "Allocation of Tax Amounts Between Married Filing Separate Spouses, Same-Sex Spouses, or Registered Domestic Partners With Community Property Rights" to "Allocation of Tax Amounts Between Certain Individuals in Community Property States" .

(68) IRM 3.11.3.53(2) (Form 8941, Credit for Small Employer Health Insurance Premiums) -- Added a new line A - SHOP ( Small Business Health Options) Checkbox and line B (Employment Taxes Employer Identification Number). Deleted original lines 1a and 1b.

(69) IRM 3.11.3.53(4) -- Added new (4) with a table of what code to enter when the taxpayer answers question A.

(70) Deleted Form 8834, Qualified Electric Vehicle Credit subsection.

(71) IRM 3.11.3.58 (Form 8960, Net Investment Income Tax - Individuals, Estates and Trusts) -- Added a new (4) for when the taxpayer has checked any of the boxes in Part I (Investment Income).

(72) Added a new subsection 3.11.3.59 for Form 8962, Premium Tac Credit (PTC) -- including sequence code, T-Lines, Relief Box, Boxes marked on line 4, start and end month instructions and percentage instructions.

(73) Added a new subsection 3.11.3.60 for Form 8965, Health Coverage Exemption -- including sequence code, T-Lines, yes box Part II.

(74) IRM 3.11.3.61 (Form 1040A) -- Added new T-Lines 30 and 37.

(75) IRM 3.11.3.61.1(1) (Form 1040A, General Information) -- Added Form 8962 and Form 8965 to the list of forms that can be attached to the Form 1040A.

(76) IRM 3.11.3.61.1(4) -- Added Identity Theft to Special Situations

(77) IRM 3.11.3.61.2.8, Line 13 -- Removed Jury Duty Fee and added Dividends to Alaska Permanent Fund.

(78) IRM 3.11.3.61.2.11, Line 16 -- Changed Educator Expenses to Reserved.

(79) IRM 3.11.3.61.2.13, Line 19 -- Changed Tuition and Fees to Reserved.

(80) Added a new subsection 3.11.3.61.3.3 for Line 29, Excess Advance Premium Tax Credit repayment (Form 8962).

(81) IRM 3.11.3.61.3.10 -- Added a new subsection for Line 38, Health Care.

(82) IRM 3.11.3.61.3.11 -- Removed paragraph to edit CCC "Y" when "COBRA" or "UT" is notated to the left of Line 39.

(83) IRM 3.11.3.61.3.12(1) (Line 40, Withholding) -- Changed the 2nd row of the table "IF" column from any amount to ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

(84) IRM 3.11.3.61.3.12(2) -- In the Note, clarified the meaning of a "single supporting document" .

(85) IRM 3.11.3.61.16 (Line 42a - Earned Income Credit (EIC) -- Revised (1) correspondence instructions.

(86) IRM 3.11.3.61.3.8 -- Added a new subsection for Line 45, Premium Tax Credit (PTC).

(87) IRM 3.11.3.61.3.27 -- Added a new subsection for (Identity Protection Private Identification Number (IP PIN) .

(88) IRM 3.11.3.62 (Form 1040EZ) -- Added a new line 12, Total Tax.

(89) IRM 3.11.3.63.1(3) (Form 1040EZ, General Information) -- Added Identity Theft to Special Situations.

(90) IRM 3.11.3.63.12 -- Added new subsection for Line 11, Health Care (Form 8965)

(91) IRM 3.11.3.63.13 -- Added new subsection for Line 12, Total Tax.

(92) IRM 3.11.3.63.19 -- Added a new subsection for (Identity Protection Private Identification Number (IP PIN).

(93) IRM 3.11.3.63 (Conversion of Form 1040A, Form 1040EZ or Form 1040EZ-T, and Prior Year Forms) -- Added new (5) for Form 8962 when attached to Form 1040EZ.

(94) IRM 3.11.3.64.2 (4b - Exception) (Statutory Protection Cases) -- Added the following types of returns not to send to Statute Control for Clearance:

  • ICS (Integrated Collection System)

  • NFR (Non-Filer Reject)

  • Secured by TE/GE

  • Secured by TE/GE EP Exam

(95) IRM 3.11.3.64.2 -- Added a new (5) with instructions for Form 12412, Operations Assistance Request when received from TAS.

(96) IRM 3.11.3.64.3.2.2.1 (4) -- Updated the paragraph reference from "X" to "R" for Form 6001.
(18) -- Updated the paragraph reference from "T" to "N" for Form 6001.
(23) -- Updated the paragraph reference from "T" to "N" for Form 6001.

(97) IRM 3.11.3.64.31.15 (Making Work Pay and Government Retiree Credits (Schedule M) -- Removed (2) to "X" the line for "Amount You Want Refunded" or "Amount You Owe" .

(98) Deleted subsection for Line 67, First-time Homebuyer Credit (Form 5405).

(99) IRM 3.11.3.64.3.1.21 (Claim for Telephone Excise Tax) -- Removed TY 06 instructions to photocopy and send to the 1040X Unit.

(100) IRM 3.11.3.64.3.2.12 (6) (Form 5405) -- Removed the last row and the Note from the table for Line A.

(101) IRM 3.11.3.64.3.2.42 -- Added a new subsection for Form 8958.

(102) IRM 3.11.3.64.3.2.45 -- Added a new subsection for Form 8962.

(103) IRM 3.11.3.64.3.2.46 -- Added a new subsection for Form 8965.

(104) IRM 3.11.3.65 (Form 1040EZ-T, Claim for Refund of Federal Telephone Excise Tax) -- Deleted (1) to photocopy and send to the 1040X Unit.

(105) Exhibit 3.11.3-1, Attachment Guide:

  • Added -- CP 01A, "We've Assigned You an Identity Protection Personal Identification Number" (IP-PIN)

  • Added -- CP 01 H, ID Theft Lock

  • Added -- CP 54, SSN and Name Inquiry

  • Added LTR 0396C (loose)

  • Form 656, Offer in Compromise -- added a Note to also route any supporting documentation

  • Form 911, Application for Taxpayer Assistance Order -- Changed the "Information" for when the return is Numbered.

  • Form 1040EZ-T, Claim for Refund of Federal Telephone Excise Tax -- Changed the "Information" to see IRM 3.11.3.65.

  • Form 1040PC (Prior Year) -- Changed "Detach" from Yes to No

  • Form 3468, Investment Credit -- Corrected "Information" to include Part III, form 3800

  • Form 4029, Application for Exemption from Social Security and Medicare Taxes and Waiver of Benefits -- For an original form, a complete mailing address was added under "Information" .

  • Form 4562-FY, Depreciation and Amortization -- Added a Note under "Information" for when Form 4562 is attached.

  • Deleted Form 4952, Investment Interest Expense Deduction

  • Form 8288, U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests -- Added "Yes" to "Detach" an original and send to OSPC

  • Form 8288, U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests -- "Information" under "No" was changed to if a copy, leave attached.

  • Form 8586, Low-Income Housing Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8820, Orphan Drug Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8826, Disabled Access Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8835, Renewable Electricity and Refined Coal Production Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8844, Empowerment Zone and Renewal Community Employment Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8845, Indian Employment Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8857, Request for Innocent Spouse Relief -- Corrected the Mailing Address

  • Form 8864, Biodiesel Fuels Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8874, New Markets Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8881, Credit for Small Employer Pension Plan Startup Costs -- Corrected "Information" to include Part III, form 3800

  • Form 8882, Credit for Employer-Provided Childcare Facilities and Services -- Corrected "Information" to include Part III, form 3800

  • Form 8886, Reportable Transaction Disclosure Statement -- Added CCC "I" to the "Information" .

  • Form 8896, Low Sulfur Diesel Fuel Production Credit -- Corrected "Information" to include Part III, form 3800

  • Form 8938, 8938, Statement of Foreign Financial Assets -- Added a "Note" with the IRM reference.

  • Added new Form 8949, Sales and Other Dispositions of Capital Assets

  • Form 14039/14039SP, Identity Theft Affidavit -- revised the "Information" procedures.

  • Added new ACA Petition

(106) Exhibit 3.11.3-3, Return Processing Codes (RPC):

  • Added new RPC "H" -- When Form 8283 is present with entries and an amount is present on line 17, Schedule A.

(107) Exhibit 3.11.3-5, Audit Codes:

  • Added another return condition to Audit Code "B" -- An amount of ≡ ≡ ≡ ≡ ≡ ≡ ≡ on line 27 of Schedule A and lines 21 through 24 are blank.

  • Revised the return condition for Audit Code "C" .

(108) Exhibit 3.11.3-7, Special Processing Codes (SPC):

  • Added new SPC "S" -- Form 14039SP is attached. Generates Notice CP01S to taxpayer(s) identifying themselves as victim(s) of identity theft.

  • SPC "8" -- Deleted the Note to send Letter 5073C.

(109) Exhibit 3.11.3-11, Frivolous Filer/Non-Filer Review Box Criteria and Definitions:

  • Added "UCC 1-308" to the 4th bullet listing.

(110) Exhibit 3.11.3-12, Criminal Investigation Review Box Criteria -- Revised the procedures.

(111) Exhibit 3.11.3-13, Integrity and Verification Operation (IVO) Review Box Criteria -- Revised the procedures.

(112) Exhibit 3.11.3-14, Examination Review Box Criteria -- Revised the procedures.

(113) Exhibit 3.11.3-15, Glossary and Acronyms:

  • Added "DFAS" -- Defense Finance and Accounting Services

  • Added "ACA" -- Affordable Care Act

  • Added "MeF" -- Modernized e-file

  • Added "PTC" -- Premium Tax Credit

(114) Exhibit 3.11.3-16, Form 6001 Instructions

(115) Rec'd dates

Effect on Other Documents

IRM 3.11.3, Individual Income Tax Returns, dated October 19, 2013 (effective January 1, 2014), is superseded. This IRM also incorporates the following IRM Procedural Updates (IPUs) issued between January 2014 through September 2014: – 14U0133, 14U0246, 14U0657, 14U0707, 14U0735, 14U0804, 14U0846, 14U0893, 14U1017, 14U1028, 14U1040,14U1083, 14U1092, 14U1190, 14U1210, 14U1222, 14U1287, 14U1339, 14U1368, 14U1398.

Audience

Wage and Investment, Code and Edit Tax Examiners

Effective Date

(01-01-2015)

Paul Mamo
Director, Submission Processing
Wage and Investment Division

3.11.3.1  (01-01-2015)
Introduction

  1. This section of the Internal Revenue Manual (IRM) provides instructions for coding and editing individual income tax returns for computer processing. Special codes are entered into the computer to perform specific functions. Editing is necessary because many returns are incomplete, contain invalid or misplaced entries or are computed incorrectly. When processing Forms 1040, supporting forms and schedules must be in order by form sequence code. This requirement is not applicable when processing Forms 1040A or Forms 1040EZ.

  2. Instructions in this manual are for Form 1040, Form 1040A, and Form 1040EZ (1040/A/EZ).

    Note:

    See Exhibit 3.11.3-15 for a glossary of frequently used terms and acronym listing.

  3. A Job Aid (2431-009 Coding & Editing Individual Income Tax Returns - Current Year Job Aid Form 1040, Form 1040A and Form 1040EZ) was developed as a reference guide for this manual. This manual refers the tax examiner to clarifying information or exhibits in the Job Aid, where appropriate. When a conflict between any referenced material and the IRM instructions occur, the IRM instructions take precedence.

3.11.3.2  (01-01-2015)
General Guidelines

  1. Instructions in this manual are for a typical return. Apply the instructions as far as possible when a situation is not explained.

  2. Take no action when there is not a specific instruction for a situation.

  3. Refer conflicts between general and specific instructions, unusual situations, and complex cases to your work leader.

  4. Any line in this manual which is marked with a "#" is for official use only and must not be disclosed.

  5. The general guidelines described in more detail in this subsection of the manual are:

    • Programs worked in Code & Edit

    • Identifying "numbered" and "unnumbered" returns

    • Routing completed work

3.11.3.2.1  (01-01-2015)
Programs Worked

  1. Code & Edit works the Form 1040, Form 1040A and Form 1040EZ programs listed below:

    Program Code Description
    4311X Other-than-full-paid Forms 1040
    4321X Full-paid Forms 1040
    4411X Other-than-full-paid Forms 1040A
    4412X Full-paid Forms 1040A
    4713X Other-than-full-paid Forms 1040EZ
    4714X Full-paid Forms 1040EZ

3.11.3.2.2  (01-01-2015)
Identifying "Numbered" and "Unnumbered" Returns

  1. A "numbered" return has a fourteen-digit Document Locator Number (DLN) imprinted in the top right margin. Do not remove a numbered return from the block.

  2. An "unnumbered" return has no DLN. These documents are numbered after coding and editing. Unnumbered returns may be removed from the block, as instructed.

3.11.3.2.2.1  (01-01-2015)
Document Locator Number (DLN)

  1. DLNs are unique numbers assigned to every return processed by the Automatic Data Processing (ADP) Systems. The DLN is used to control, identify, and locate the document.

3.11.3.2.2.1.1  (01-01-2015)
Julian Date

  1. A Julian date is the numeric day of the year. For example, April 15, 2015, is Julian date 105, the 105th day of 2015.

    1. The sixth, seventh, and eighth digits in the DLN make up the Julian date.

3.11.3.2.2.1.2  (01-01-2015)
Sequence Number

  1. The twelfth and thirteenth digits of the DLN are the sequence number.

    1. Returns in a block are numbered from "00" to "99" . The maximum number of returns in a numbered block is 100.

    2. Numbered returns in a block must be kept in sequence number order.

3.11.3.2.3  (01-01-2015)
Routing Completed Work

  1. After coding and editing:

    If the returns are Then
    Numbered and blocked, Send them to be transcribed.
    Unnumbered and not blocked, Send them to be numbered and blocked.

3.11.3.3  (01-01-2015)
General Instructions

  1. The general instructions for all Form 1040-series returns are provided here. The general instructions in this section include:

    • Perfecting transcription lines

    • Putting forms and schedules in transcription sequence

    • Preparing Form 3471 - Edit Sheet and Form 4227 - Intra-SC Reject or Routing Slip

    • Editing "Action Trails"

    • Handling attachments to returns

    • Editing special processing and unallowable codes

    • Identifying unprocessable and uncomputed returns

3.11.3.3.1  (01-01-2015)
Computer Assisted Pipeline Review (CAPR)

  1. CAPR is the computer-based system for tracking the causes of errors on returns processed to the Error Resolution System (ERS).

3.11.3.3.2  (01-01-2015)
Stamping Tax Examiner (TE) Numbers

  1. Every Code & Edit Tax Examiner (TE) is assigned a unique TE Number.

  2. Stamp your TE number in the upper left-hand corner of the document. All returns must be stamped with your TE number.

    Exception:

    It is only necessary to stamp the first document in a block when working numbered returns.

  3. Stamp your TE number in the upper left-hand corner of all detached documents.

    Exception:

    Do not stamp your TE number on original documents that are being mailed back to the taxpayer.

  4. Line through the TE number when corresponding and the return is going to be sent to the taxpayer.

  5. Line through the old TE number and stamp the document with your TE number when working returns which were TE stamped before (e.g., misblocked, converted or correspondence returns).

3.11.3.3.3  (01-01-2015)
Transcription Lines (T-Lines) and Transcription Compute Lines (T-Compute Lines)

  1. Not all entries on forms and schedules are entered into the computer during processing. Only the information from transcription lines (T-Lines) or computed transcription lines (T-Compute Lines) is entered into the computer after coding and editing.

  2. T-Lines and T-Compute Lines are listed in this manual in the overview information for each form or schedule. The edited locations of all T-Lines and T-Compute Lines are illustrated in the Job Aid.

  3. Always compute and edit a T-Compute Line when it is blank and there are entries leading to a total. Compute and edit a T-Compute Line that is not blank only when required to do so in the line-by-line instructions.

    Note:

    Use the tax form instructions when computing T-Compute Line totals unless other directions are provided in the line-by-line instructions.

  4. Edit T-Line and T-Compute line amounts when they are illegible, obviously misplaced, or when instructed to do so in the line-by-line instructions.

  5. Correct the entry by referring to other schedules, attachments, or entries on the return only when directed.

  6. Delete an entry on a transcribed line when the meaning of the line has been changed, unless otherwise instructed. (See Figure 3.11.3-1a).

  7. Delete an obviously misplaced amount and edit to the correct T-Line or T-Compute Line when appropriate. (See Figure 3.11.3-1b).

  8. Use attachments to prepare "dummy" forms or schedules when they are required to support entries on transcribed lines.

  9. Edit the combined total of the amounts when a T-Line or T-Compute Line has multiple entries. See Figure 3.11.3-2.

  10. DO NOT MATH VERIFY the transcribed lines on forms or schedules unless specifically directed to do so in the line-by-line instructions.

    Figure 3.11.3-1
    This image is too large to be displayed in the current screen. Please click the link to view the image.

    Figure 3.11.3-2
    This image is too large to be displayed in the current screen. Please click the link to view the image.

3.11.3.3.4  (01-01-2015)
Sequence of Transcribed Schedules and Forms

  1. Organize the Form 1040 return and its transcribed schedules and forms according to sequence code. Sequence Codes are preprinted numbers, usually present in the upper right margin. See the table at the end of this subsection for a list of the Sequence Codes of all transcribed schedules and forms. Any document not on the list is not a transcribed form or schedule and should be deleted or moved. Also delete any form that shares a sequence number with a transcribed form.

    Example:

    Examples include, but are not limited to the following:
    - Form 8862 (Seq. 43A)
    - Form 2106 (Seq. 54) (for TY07 and prior)
    - Form 3468 (Seq. 52) (TY09 and prior)
    - Form 3903 (Seq. 62) (TY10 and prior)
    - Form 4562-FY (Seq. 67)
    - Form 4563 (Seq. 68)
    - Form 5884-B (Seq. 65)
    - Form 8621 (Seq. 69)
    - Form 8949 (Seq. 12A)
    - Schedule D-1 (Seq. 12A) (TY10 and prior)

    Note:

    "X" a transcribed schedule or form if it is blank or has no significant T-line entries, unless specifically instructed otherwise.

    Note:

    Delete duplicate forms or schedules with the exact same amounts that are filed for the same taxpayer.

  2. Leave Forms W-2 and 1099, Form 1040-V, taxpayer statements, deposit slips, small forms, and other items where found when they do not obstruct T-lines or any part of the caption area.

  3. Delete or move any document which will not be transcribed. Documents which are not transcribed may be in any order behind the last transcribed page.

    Form 1040
    Transcribed Form or Schedule Sequence Code
    Schedule A 07
    Schedule B 08
    Schedule C/C-EZ 09, 10, 11
    Schedule D 12
    Schedule E 13
    Schedule F 14,15
    Schedule R 16
    Schedule SE 17, 18
    Form 1116 19
    Schedule J 20
    Form 2441 21
    Form 3800 22
    Form 4136 23
    Form 4137 24, 25
    Form 4684 26
    Form 4797 27
    Form 4972 28
    Form 5329 29, 30
    Form 6198 31
    Form 6251 32
    Form 8615 33
    Form 4835 37
    Form 8839 38
    Form 8853 39
    Form 8814 40, 41, 42
    Schedule EIC 43
    Schedule H 44, 45
    Schedule 8812 47
    Form 8606 48, 49
    Form 8863 50
    Form 4952 51
    Form 8889 52, 53
    Form 8880 54
    Form 8888 56
    Form 5405 58, 59
    Form 8917 60
    Form 8919 61, 62
    Form 8958 63
    Form 8941 65, 66
    Form 8834 67
    Form 8910 68
    Form 8936 69
    Form 8867 70
    Form 8959 71
    Form 8960 72
    Form 8962 73, 74
    Form 8965 75
    Form 1040A
    Transcribed Form or Schedule Sequence Code
    Schedule B 08
    Schedule R 16
    Form 2441 21
    Form 8615 33
    Schedule EIC 43
    Schedule 8812 47
    Form 8606 48, 49
    Form 8863 50
    Form 8880 54
    Form 8888 56
    Form 8917 60
    Form 8867 70
    Form 8962 73, 74
    Form 8965 75

    Note:

    Sequencing of supporting forms and schedules is not required when processing Form 1040A.

  4. Form 8888, Form 8867 and Form 8965 are the only valid attachments for Form 1040EZ.

3.11.3.3.5  (01-01-2015)
Form 3471 and Form 4227, Internal - Use Forms

  1. Two general internal-use forms are used in Code & Edit. They are:

    • Form 3471 - Edit Sheet

    • Form 4227 - Intra-SC Reject/Routing Slip

  2. The conditions requiring these forms are found in the line-by-line instructions.

3.11.3.3.5.1  (01-01-2015)
Form 3471 - Edit Sheet

  1. Edit money amounts on Form 3471 in dollars only for all form types (1040/A/EZ).

  2. Position the Form 3471 on the left side of page 1, Form 1040, Form 1040A and Form 1040EZ, even though it has a Sequence Code of "02" . Staple Form 3471 to the first page margin of:

    1. Forms 1040 or Form 1040A, just below the filing status area.

    2. Form 1040EZ, just below the Presidential Election Campaign Fund (PECF) area.

3.11.3.3.5.1.1  (01-01-2015)
Unallowables

  1. Edit Form 3471, lines 1, 2, and 3 - Unallowable Items - as follows:

    1. Edit all codes in the order the unallowables are found.

    2. Edit the first two unallowables on lines 1 and 2 when there are more than three and edit Unallowable Code "98" on line 3 with no money amount. Edit the remaining Unallowable Codes and amounts in the "Processing Memo" space.

    Note:

    Refer to the instructions on Unallowable Codes in IRM 3.11.3.3.9 for more information.

3.11.3.3.5.1.2  (01-01-2015)
Late Filing/Late Payment Penalties and Interest

  1. Returns may be received from Examination or Collection with penalty and interest amounts entered. These amounts will usually be present on Form 4364, Delinquency Computations.

    Note:

    Use the instructions in IRM 3.11.3.14.8.5 when penalty and interest amounts are entered by the taxpayer.

  2. Edit a "1" on line 6 on Form 3471, Late Filing Code, when Failure to File (FTF) or Failure to Pay (FTP) penalties or interest have been entered on a full or part-paid return and≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  3. Edit an amount on line 7 on Form 3471, Pre-Delinquent Penalty (Late Filing Penalty), when both of the following apply:

    1. The return has a received date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    2. There is a notation that this penalty is to be applied.

3.11.3.3.5.1.3  (01-01-2015)
ID Number Penalty

  1. Edit an amount on line 11, ID Number Penalty, Form 3471 when there is a notation on the return that this penalty is to be assessed and an amount is present.

    Note:

    Examination or Collection will indicate when this penalty is to be assessed.

3.11.3.3.5.2  (01-01-2015)
Form 4227 - Intra-SC Reject or Routing Slip

  1. Some returns need research, referral, or action before they can be processed. Form 4227 is often used to identify these special conditions and initiate actions.

  2. Take the following actions when a numbered return needs research, referral, or action before further processing:

    1. Edit the appropriate Action Code.

    2. Prepare Form 4227 and note the reason for rejection.

    3. Leave the return in the block.

  3. Prepare Form 4227 when an unnumbered return/document is withdrawn from processing, and:

    If the return/document is Then
    Leaving the campus, Pull the document for routing to Receipt and Control for shipment.
    Not leaving the campus, Pull the document for routing to the appropriate function.

3.11.3.3.6  (01-01-2015)
Action Trails

  1. An "Action Trail" is written on a return/document as a record of actions taken.

  2. Always leave an Action Trail when Computer Condition Code "Y" is edited. Give the reason for the "Y" code in the Action Trail.

  3. Edit an Action Trail when a return/document is detached. For example, notations such as "detached 1040X" or "detached taxpayer correspondence" must be made.

  4. The Action Trail is written on Form 1040, Form 1040A or Form 1040EZ in the lower-left margin of page 1. Refer to the Job Aid for an illustration of the editing location.

3.11.3.3.7  (01-01-2015)
Attachments to Return

  1. Examine all attachments to the return. Leave the attachments with the return unless specifically instructed otherwise. Refer to the Attachment Guide in Exhibit 3.11.3-1 for specific attachment-by-attachment instructions. Research either an attachment or a notation on the return, as appropriate.

  2. Immediately take any discovered remittance to the work leader. (Work leader shall refer to IRM 3.8.46, Discovered Remittance).

  3. Take either of the following actions when there is a notation on the return that indicates it needs to be routed elsewhere:

    1. Edit the information on a blank piece of paper.

    2. Photocopy the notation.

  4. Generally, all taxpayer-initiated correspondence must be responded to within 30 days.

    1. Detach and route all correspondence addressing an issue not directly related to the processing of the return.

      Note:

      Examples include, "I didn't receive my refund last year" , or "I need a payment plan" , etc.

    2. Do not detach correspondence attached to an original return which asks a question or raises an issue about the processing of the return or if the correspondence contains only a general comment submitted with a payment.

      Note:

      Examples include, "Here is my payment" , "I will pay you in two months" , or "Apply my refund to the amount that I owe from last year" , etc.

  5. Route to Examination any taxpayer-initiated correspondence related to Earned Income Credit (EIC) fraud. Use Form 4227 and notate "EIC fraud informant" . Correspondence that must be routed to Examination will state the following:

    1. The taxpayer was unable to file electronically because another taxpayer had already filed and claimed the same qualifying exemption(s), and/or

    2. The name and/or Social Security Number of the other taxpayer involved.

  6. When a taxpayer submits a credit card and/or credit card number, immediately take the return and all attachments to your work leader. The work leader will:

    1. Edit Action Code "460" , sanitize any credit card information on the return and continue processing.

    2. Prepare Form 4287 (Record of Discovered Remittances), a photocopy of page one of the return, and route to Receipt & Control with the credit card to be returned to the taxpayer via Express Mail.

    3. Prepare Letter 3956C (Processing Form 1040 Received With Credit Card/Credit Card Information) and send to the taxpayer via 1st Class Mail.

    Note:

    Alert your work leader of the need to notify the taxpayer and the work leader will ensure that the appropriate letter is prepared and sent. DO NOT take returns to your work leader when it can be determined that the number written on the return is the credit card payment confirmation number (not the actual credit card number). The confirmation number will be in the top-left margin of the front page of the return. These returns must be batched as remittance returns so that they will receive the remittance indicator. If the return is received with a credit card confirmation number and No amount is indicated, or the amount does not match the balance due line on the return, batch as "Part Paid" .

3.11.3.3.7.1  (01-01-2015)
Detached Documents

  1. Always leave an Action Trail on the return when an attachment is removed. For example, when a form or letter is detached from a return, notations such as "detached 1040X" or "detached TP correspondence" must be made.

  2. An Action Trail must also be written on the detached document unless it's an original document. If present on the return, all of the following must be present or edited on all detached items:

    • Current date if before ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , otherwise use the received date in "MMDDYY" format.

    • Tax period in "YYMM" format.

    • Form from which detached.

    • Taxpayer's name(s).

    • Primary/secondary taxpayer's identification number(s).

    • Taxpayer's address.

    Note:

    When sending a return back to a taxpayer, do not detach ANY documents.

    Exception:

    Detach and process any remittance. Do not mail back a remittance to the taxpayer.

  3. Route detached items using Form 4227.

3.11.3.3.8  (01-01-2015)
Processing Codes

  1. Certain conditions require the editing of processing codes. There are five types of processing codes. They are:

    • Computer Condition Code (CCC)

    • Return Processing Code (RPC)

    • Action Code

    • Audit Code

    • Special Processing Code (SPC)

  2. Processing codes may be either letters or numbers. Use CAPITAL BLOCK LETTERS when editing codes which are letters. Write the codes legibly.

  3. The edited location of most of these codes varies by return type.

    Note:

    When other functions have edited CCCs, RPCs, SPCs, etc in the wrong location, delete the coding and edit it to the correct location.

    Caution:

    Re-edit any valid black edit marks in red on photocopied returns.

  4. Refer to the Job Aid for an illustration of the editing locations of processing codes.

  5. The conditions for editing processing codes can be found in the line-by-line instructions.

3.11.3.3.8.1  (01-01-2015)
Computer Condition Code (CCC)

  1. A CCC is used to identify a special condition or computation. CCCs post to the Master File.

  2. When CCC "3" is edited, it MUST be first.

  3. Always edit an Action Trail when CCC "Y" is edited.

  4. Edit the CCC (horizontally) in the following location on:

    1. Forms 1040 or Form 1040A - in the upper center portion of the filing status area.

    2. Form 1040EZ - to the left of line 1, under "Foreign Province/State/County."

  5. Refer to the table in Exhibit 3.11.3-2 for an explanation of each CCC action.

3.11.3.3.8.2  (01-01-2015)
Return Processing Code (RPC)

  1. An RPC is used to identify a special condition or computation for the computer. An RPC does not post to the Master File.

  2. Edit the RPC vertically in the margin on:

    1. Form 1040 to the right of line 22

    2. Form 1040A to the right of line 15

    3. Form 1040EZ to the right of line 10

  3. Refer to the table in Exhibit 3.11.3-3 for an explanation of each RPC action..

3.11.3.3.8.3  (01-01-2015)
Action Code

  1. An Action Code is used to reject a document and identify the reason for rejection.

  2. It is critical that Action Codes are edited legibly.

  3. Assign only one Action Code to a document. Edit Action Codes in the following priority:

    1. "310"

    2. "4XX"

    3. "6XX"

    4. "2XX"

    5. "3XX"

  4. Continue perfecting returns assigned any Action Code except "6XX" . Edit only the caption area when an Action Code of "6XX" is edited.

  5. Edit the Action Code in the center of the bottom margin on page 1 of Form 1040, Form 1040A or Form 1040EZ.

  6. Refer to the table in Exhibit 3.11.3-4 for an explanation of each Action Code.

3.11.3.3.8.4  (01-01-2015)
Audit Code

  1. Audit Codes identify questionable conditions for Examination.

  2. These codes are edited horizontally in the right-bottom margin of page 1 on Form 1040, Form 1040A or Form 1040EZ.

  3. Refer to the table in Exhibit 3.11.3-5 for the explanation of each Audit Code.

3.11.3.3.9  (01-01-2015)
Unallowable Code

  1. Certain conditions on a tax return are unallowable by law. Search all attachments to find unallowable items.

  2. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Exception:

    The ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  3. Do not edit unallowable codes (UACs) when the only dollar amount is a total of allowable and unallowable items. There must be separate dollar figures for unallowable coding, unless otherwise instructed.

  4. Prepare Form 3471 when coding unallowables. Edit amounts on Form 3471 in dollars only.

  5. The unallowable conditions are described in the specific line-by-line instructions and in the table in Exhibit 3.11.3-6.

3.11.3.3.9.1  (01-01-2015)
Special Processing Code (SPC)

  1. Special Processing Codes (SPCs) are edited vertically in the right margin between the secondary taxpayer identification number (TIN) and the PECF designation.

  2. Special Processing Codes are described in the specific line-by-line instructions and in the table in Exhibit 3.11.3-7.

3.11.3.3.9.2  (01-01-2015)
Post-Editing Unallowable Review

  1. Review all returns with edited unallowables.

  2. Review each return closely for additional unallowables or frivolous conditions. Correct any unallowables which have been improperly coded.

3.11.3.3.10  (01-01-2015)
Unprocessable Return

  1. A return is unprocessable when all of the entity data is missing or illegible and the entity cannot be perfected from attachments or through research.

  2. Handle unprocessable returns as follows:

    If the return is Then
    Numbered,
    1. Edit Action Code "640" .

    2. Prepare Form 4227 instructing the Reject Unit to void the DLN and dispose of the return.

    Unnumbered, Give the return to your work leader. The work leader will refer to IRM 3.11.3.7.2.3 for instructions on proper disposal.

3.11.3.3.11  (01-01-2015)
Uncomputed Return

  1. An uncomputed return is one filed by a taxpayer expecting the IRS to figure his/her tax. Do not confuse an uncomputed return with a return that has no tax due.

  2. An uncomputed return can be identified as follows:

    1. Form 1040 has no entries on lines 44, 45, 46, 47, 56, 63, 75, 76a, 77 and, 78 -- see Figure 3.11.3-3.

    2. Form 1040A has no entries on lines 28, 29, 30, 37, 39, 47, 48a, 49 and 50.

    3. Form 1040EZ has no entries on lines 10, 11, 12, 13a, and 14.

  3. An unnumbered, uncomputed return can be sent back to the taxpayer when corresponding.

  4. Edit CCC "Y" - and an Action Trail - on an uncomputed return when both of the following conditions are present:

    1. Separate income amounts are shown for each spouse on a joint return, and

    2. No exemptions are claimed in positions 2 through 7, or an allocation of exemptions is indicated.

      Example:

      The taxpayer notes, "My wife has the exemptions for our two children."

    Figure 3.11.3-3
    This image is too large to be displayed in the current screen. Please click the link to view the image.

3.11.3.4  (01-01-2015)
Editing

  1. Editing is done to prepare returns and attachments for transcription and computer processing.

  2. The editing instructions described in more detail in this subsection are about:

    • Types and uses of specific edit markings

    • Dollars and cents editing

3.11.3.4.1  (01-01-2015)
Edit Markings, General

  1. Always use red for edit markings. Perfect taxpayer entered red marks which might interfere with transcription.

  2. Never alter, erase, or obliterate a taxpayer's entry.

  3. Any reference to "significant entry" or "significant amount" is defined as a positive or negative number/dollar amount other than zero.

3.11.3.4.2  (01-01-2015)
Types of Edit Markings

  1. Different edit conditions require different types of edit markings. Edit markings consist of:

    • Circling

    • Underlining

    • Arrowing

    • "X" -ing

    • Bracketing

    • Checking

3.11.3.4.2.1  (01-01-2015)
Circling

  1. Circle information that is not to be transcribed when editing:

    • Entity data (except date of death)

    • Received dates

    • Filing status boxes

    • Other cases described in the line-by-line instructions

      Note:

      NEVER circle dollar amounts.

3.11.3.4.2.2  (01-01-2015)
Underlining

  1. Underline when editing:

    • The additional information line and other caption data

    • Prior year return tax periods

    • Other cases specified in this manual

3.11.3.4.2.3  (01-01-2015)
Arrowing

  1. Use arrowing when indicating:

    • The correct T-line for a misplaced entry. See Figure 3.11.3-4.

    • Transcription is to continue (where indicated in line by line instructions)

    Note:

    A double-ended arrow or "underline with arrow" may be used to edit a dollar amount to multiple T-lines. See Figure 3.11.3-4.

    Figure 3.11.3-4

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

3.11.3.4.2.4  (01-01-2015)
"X" -ing

  1. An "X" may be used to delete an entry or an entire form or schedule.

    1. Place an "X" to the left of an amount on a T-line when it is not to be transcribed.

    2. "X" an illegible amount and re-edit the information above or to the left of the "X " -ed entry. Be careful to edit the amount where it will not be mistaken for an entry on another T-line.

    3. Edit an "X" across the form or schedule if it must be deleted.

    4. "X" a transcribed schedule or form when it is blank or has no significant T-line entry, unless specifically instructed otherwise.

      Note:

      Move documents which are not transcribed forms or schedules behind the last transcribed page if not deleted.

    5. "X" any transcribed schedule or form with "Alt-Min Tax" , "AMT" , or "AMT-CR" across the top.

    Exception:

    Do not delete Form 6251, Alternative Minimum Tax-Individuals.

3.11.3.4.2.5  (01-01-2015)
Bracketing

  1. Use the bracket to indicate a negative dollar amount when determining a T-Compute line amount.

    Note:

    Bracketing (as it relates to dollar amounts) is ONLY necessary when the tax examiner is computing the line. Existing negative amounts on a return do NOT require bracketing.

  2. Bracket a negative amount on the correspondence sheet.

3.11.3.4.2.6  (01-01-2015)
Checking

  1. Use the check mark as directed in line-by-line instructions to indicate information that needs to be picked up by data transcribers.

3.11.3.4.3  (01-01-2015)
Dollars and Cents Editing

  1. Allow taxpayers to round or truncate (i.e., "drop the cents" ) amounts. Use only dollar amounts when computing amounts on forms or schedules.

    Exception:

    Use dollars and cents when computing withholding and excess social security tax.

  2. Draw a vertical line between the dollars and cents figures when dollars or cents are in the wrong column:

    1. On each line that is to be transcribed, or

    2. Down the entire front of the form or schedule.

    Exception:

    It is not required to draw a vertical line when column(s) are not present and the dollars and cents have been separated by a decimal.

  3. Dollars and cents editing is required on certain T-lines for any of the following conditions:

    1. A substitute form is used with dollars and cents not clearly separated by a decimal point or slash.

      Exception:

      Do not draw a vertical line to separate dollars and cents when only dollar amounts are present on a dollars and cents T-line.

    2. An entry is illegible.

    3. Other editing requires a change to the taxpayer's entries.

    4. When computing and editing an entry as directed in line by line instructions.

      Exception:

      Do not edit "00" to indicate no cents.

      Reminder:

      Ensure dollars and cents are referenced in any correspondence to the taxpayer.

  4. Edit all forms and schedules in dollars only, WITH THE FOLLOWING EXCEPTIONS:

    • Forms 1040 - Lines 63 through 79

    • Form 1040A - Lines 39 through 51

    • Form 1040EZ - All lines

3.11.3.5  (01-01-2015)
Received Dates

  1. The received date is the date that a return was received by the IRS.

  2. Information and instructions about received dates included in this subsection of the manual include:

    • General instructions

    • Timely received dates

    • Determining the received date

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • Late-filed returns

    • Extensions

    • Reasonable cause criteria

3.11.3.5.1  (01-01-2015)
Received Dates, General Instructions

  1. A received date is always required when the return is:

    • Amended

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • For a fiscal year, prior year, or short year

    • Early-filed for a decedent (filed before the close of the current year)

    • Processed after June 3, or the Julian date in the DLN is 155 or later

    Exception:

    See IRM 3.11.3.5.5(3) Exception Note.

  2. Circle a received date when it is present on a return that does not need one. See Figure # 3.11.3-5 #.

  3. Circle all but the earliest valid received dates (including Statute or other valid IRS organization's received dates) when there are multiple received dates present and a received date is required (See IRM 3.11.3.5.2.1(2). Taxpayer Advocate Service (TAS) received dates are not valid received dates. If multiple received dates are identical, circle all but one received date.

    Exception:

    When the return has been mailed back for missing signature(s) and multiple received dates are present, see IRM 3.11.3.5.2(3).

    Exception:

    Austin Submission Processing Center (AUSPC) will refer to IRM 3.21.3 for received date editing and deletion procedures specific to international returns transshipped from other processing centers.

  4. If a received date is "X" -ed, circle that received date stamp.

  5. Edit the received date in "MMDDYY" format when it is required but not already present. MMDDYY format is Month Month Day Day Year Year. For example, April 23, 2015, when edited in MMDDYY format is "042315" .

  6. Edit the received date on the front of the return in the following locations:

    1. Form 1040 to the right of line 6d

    2. Form 1040A to the right of line 6d

    3. Form 1040EZ to the left of line 6

    Note:

    If a return contains a valid received date on any page other than the front of the return or in the caption area, circle the received date and edit the same received date as instructed above.

  7. Perfect the received date when it is required and not legible and in complete MMDDYY format.

    Figure 3.11.3-5

3.11.3.5.2  (01-01-2015)
Determining the Received Date

  1. Determine the received date in the following priority when it is required and there is no valid date stamp or handwritten received date:

    1. Latest postmark on the envelope or latest date from a private delivery service mark. (See Figure 3.11.3-6).

      Note:

      When the envelope certified mail receipt is not attached, use the postmark date stamped or handwritten on the return to determine the received date.

    2. Service Center Automated Mail Processing System (SCAMPS) digital dates.

    3. Latest date by the taxpayer's signature(s). (See Figure 3.11.3-6).

      Exception:

      Use the signature date on prior year returns only when it is signed this year. DO NOT use the signature date to determine the received date for replies to correspondence.

    4. Julian date minus 10 days in the DLN.

    5. Today's date minus 10 days.

    Exception:

    See the instructions in IRM 3.11.3.7.2.15 when determining the received date for a reinput return.

  2. If the stamped received date on a current year return is three months or more prior to the current date, search the return for an indication the received date is incorrect (e.g., a postmark date or signature date after the received date). If the received date is determined to be incorrect, delete it and edit a new received date following the instructions at IRM 3.11.3.5.2(1).

  3. ALWAYS review each return for the words, "Returned for Signature" or similar statement and a date present in the lower left corner of the return. These are returns that were originally received missing a signature and were mailed back to the taxpayer. If a date and the notation "Returned for Signature" or similar statement is present, refer to the following instructions for editing the received date:

    1. If the return is Balance Due and a received date is present showing a date within 30 days after the date present in the lower left corner, use the date sent back for signature as the received date. Use the most recent mail-back date when multiple dates are present. Delete any later received date(s) that may be present. See Figure 3.11.3-7.

    2. If the return is Balance Due and a received date is present showing a date MORE than 30 days after the date present in the lower left corner, honor the latest received date. Delete any earlier received date(s) that may be present.

    3. If the return is a Refund, Credit Elect or Zero balance return, honor the latest received date. Delete any earlier received date(s) that may be present.

      Reminder:

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

    Figure 3.11.3-6

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

    Figure 3.11.3-7

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

3.11.3.5.2.1  (01-01-2015)
Types of Received Dates

  1. Accept these three types of received dates:

    • IRS campus date stamp with the word "received" - to include Accounts Management, Collections, or other valid IRS organizations

      Note:

      A received date edited or stamped by the Taxpayer Advocate Service (TAS) is not a valid IRS received date.

    • IRS area/territory office date stamp

    • Valid handwritten received date

  2. To be valid, the handwritten received date must include both of the following:

    1. The word "Received" or any abbreviations of the word received and a date.

    2. A signature with an abbreviated title such as "RO" , "RA" , "RR" , "OCR" , "TSR" , or "TSSP" on the front page of the return.

    Exception:

    A handwritten received date edited in the line 6d area, Form 1040 or Form 1040A (Line 6 on Form 1040EZ) by an IRS employee in Submission Processing or IVO is valid. A clear indication that a handwritten received date has been edited by IVO will be the presence of SPC "B" and/or "IVO" noted or stamped in the upper left margin. Generally, the IVO - edited received date will be earlier than the original, stamped received date.

  3. When there is no valid date stamp and the handwritten received date is not valid, determine the received date using the instructions in IRM 3.11.3.5.2.

3.11.3.5.2.2  (01-01-2015)
Post Office Marks

  1. Accept all valid post office marks whether United States Postal Service (USPS), foreign country postmarks, or USPS private meter marks.

  2. Valid Post Office marks are:

    • Postage Validation Imprinter (PVI) labels displaying the USPS eagle

    • Killer bar strips or other cancellation marks with a date, city, and state

    • USPS Metered postmarks

    • Private Metered Marks (identified by the absence of "USPS" in the postmark).

  3. Use the following chart to determine the correct editing when only a private meter postmark is present.

    If the document is Then
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

3.11.3.5.2.3  (01-01-2015)
Private Delivery Service (PDS) Marks

  1. A private delivery service (PDS) is a business which delivers mail or packages within an agreed upon schedule (e.g. overnight or same day delivery). The "timely mailing as timely filing" rule now applies to some PDSs. When the rule applies to a PDS, it is referred to as a "designated" PDS.

  2. Do not use marks from a non-designated PDS to determine whether a return is timely filed. The "timely mailing as timely filing" rule applies only to the USPS and to designated PDSs.

  3. Accept all designated PDS marks. The only designated delivery services are listed below:

    1. DHL Express (DHL)
      • DHL Same Day Service
      • DHL Next Day 10:30 am
      • DHL Next Day 12:00 pm
      • DHL Next Day 3:00 pm
      • DHL 2nd Day Service

    2. United Parcel Service (UPS)
      • UPS Next Day Air
      • UPS Next Day Air Saver
      • UPS Second Day Air
      • UPS Second Day Air A.M.
      • UPS Worldwide Express
      • UPS Worldwide Express Plus

    3. Federal Express (FedEx)
      • Fed Ex Priority Overnight
      • Fed Ex Standard Overnight
      • Fed Ex Two Day
      • Fed Ex International Priority
      • Fed Ex International First

      Note:

      Do not use "FedEx Powership 3" labels for determining the mail date. See Figure 3.11.3-8.

  4. Use the instructions in IRM 3.11.3.5.2 for determining the date a return was received whether the mail marks are from a designated or non-designated PDS.

    Figure 3.11.3-8

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

3.11.3.5.3  (01-01-2015)
Timely-Filed Returns

  1. For 2015, a current-year return is a return filed for tax year 2014. A current calendar-year return (1412) is considered to be timely filed when it is mailed on or before the due date of April 15, 2015.

  2. Any return-other than a current calendar-year timely-filed return-always requires a received date.

  3. Generally, a current calendar-year (1412) return received on or before April 15, 2015, does not require a received date.

  4. For current calendar-year (1412) other than program 43210, received on or before April 15, 2015:

    If the document is Then
    Unnumbered and being processed before June 4, 2015, Circle the received date when present.

    Exception:

    NEVER circle a received date that has been edited in green ink.

    Numbered with a Julian date of 154 or earlier in the DLN, Circle the received date when present.

    Exception:

    NEVER circle a received date that has been edited in green ink.

    Unnumbered and being processed on June 4, 2015, or later, Edit "041515" as the received date if one is not present.
    Numbered with a Julian date of 155 or later in the DLN, Edit "041515" as the received date if one is not present.

3.11.3.5.4  (01-01-2015)
"≡ ≡ ≡ ≡ ≡ ≡ ≡ "

  1. By law, a timely-mailed return is a timely-filed return. This applies to both USPS and designated PDS mail.

  2. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡

  3. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  4. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  5. For current calendar-year (1412), other than program 43210, received during the grace period:

    If the received date is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Then
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Circle the received date.

    Exception:

    NEVER circle a received date that has been edited in green ink.

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Circle the received date.

    Exception:

    NEVER circle a received date that has been edited in green ink.

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Circle the received date. Edit a received date of "041515 " .
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Circle the received date. Edit a received date of "041515" .

    Exception:

    If penalties or interest are indicated by Examination or Collection and the return is part- or full-paid, then edit a received date of "041515 " and prepare Form 3471. See IRM 3.11.3.3.5.1 for additional information and instructions. Use the instructions in IRM 3.11.3.14.8.5 when penalty and interest amounts are entered by the taxpayer.

3.11.3.5.5  (01-01-2015)
Late-Filed Returns

  1. A return is delinquent when it is filed after the due date without an approved extension.

  2. ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    1. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    2. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  3. When the received date on a current calendar-year (1412) return ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ " or later), examine the envelope and:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    "≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Exception:

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

    "≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Note:

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

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Exception:

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

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

    Note:

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

    Exception:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  4. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

3.11.3.5.6  (01-01-2015)
Extensions

  1. Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, may be filed to extend the due date for filing an individual tax return until October 15, 2015.

  2. Extension forms are not required to be attached to the return when filed.

  3. Take one of the following actions when an original Form 4868 is attached to a return:

    If the Form 4868 is Then
    Not for the Form 1040, Form 1040A or Form 1040EZ to which it is attached (e.g., another tax period, another taxpayer), Detach the form and route it to Receipt and Control.
    For the Form 1040, Form 1040A or Form 1040EZ to which it is attached, Leave the form attached to the return.
  4. Edit CCC "R" when the taxpayer has a Form 4868 or Form 6401 attached to the return and an ITIN or IRSN is present in the primary Social Security Number (SSN) field. Both Individual Tax Identification Numbers (ITINs) and Internal Revenue Service Numbers (IRSNs) begin with the digit "9" .

    Note:

    Delete CCC "N" if it has been edited. CCC "N" is only valid on returns as outlined at IRM 3.11.3.5.7(3).

  5. Examine the envelope postmark date. If the received date is "≡ ≡ ≡ ≡ ≡ ≡ " or later, and the postmark date or designated PDS mark date is on or before October 15, 2015, edit the postmark date as the received date.

    Exception:

    Edit a timely received date on the return when the taxpayer explains that the return is late due to the rejection of a timely-filed electronic return. Postmark date must be within 10 calendar days of notification from the Service that the electronic portion of the return has been rejected or cannot be accepted for processing. (Rev. Proc. 2009-40 and Publication 1345).

  6. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Note:

    Use the instructions in IRM 3.11.3.3.5.1 to prepare Form 3471 when returns are received from Examination or Collection with penalty and interest amounts entered. These amounts will usually be present on Form 4364, Delinquency Computations. Use the instructions in IRM 3.11.3.14.8.5 when penalty and interest amounts are entered by the taxpayer.

3.11.3.5.7  (01-01-2015)
Reasonable Cause

  1. Taxpayers are liable for delinquency penalties and interest on the unpaid taxes on returns received after the due date. However, penalties for late filing, or late payment, may be excused when the taxpayer has a reasonable cause for the delay. See Exhibit 3.11.3-8 for examples of reasonable cause.

    Note:

    Reasonable cause does not excuse penalties for failure to make estimated (ES tax) payments properly UNLESS the taxpayer retired after reaching age 62 or became disabled during the tax year or the prior tax year. See Exhibit 3.11.3-8.

  2. Failure to make estimated (ES tax) payments generally can not be waived due to reasonable cause. See IRM 3.11.3.14.8.5 for waivers of the estimated tax penalty.

  3. Edit CCC "N" on a return that qualifies the taxpayer for a special extension when the received date is later than the ≡ ≡ ≡ ≡ ≡ ≡ and there is an indication (on the return or an attachment) of any of the following:

    • Indication the taxpayer lives outside the U.S. and Puerto Rico and main place of work is outside the U.S. and Puerto Rico

    • Indication the taxpayer is on military or naval duty outside of the U.S. and Puerto Rico

    • APO/FPO/DPO address.

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  4. When the taxpayer's reasonable cause statement is not acceptable:

    1. Edit CCC "7" .

    2. Correspond using Letter 854C (Penalty Waiver or Abatement Disallowed/Appeals Procedure Explained), paragraph D.

    Note:

    See the correspondence instructions in IRM 3.11.3.6.

  5. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    If the reasonable cause is for Then
    Late filing, Edit CCC "R" , unless CCC "N" has been edited.
    Late payment or a "Section 6020(b)" notation is present, Edit CCC "M" .

3.11.3.6  (01-01-2015)
Correspondence

  1. Correspondence is necessary when a return is so incomplete or illegible that it cannot be processed.

  2. The correspondence instructions in this subsection of the manual are:

    • General correspondence information and procedures

    • Sending incomplete returns back to the taxpayer

    • Correspondence action sheets

3.11.3.6.1  (01-01-2015)
General Correspondence Information

  1. All missing required information must be requested when corresponding. DO NOT CORRESPOND WITH A TAXPAYER MORE THAN ONE TIME unless specifically directed to in the line by line instructions.

    Note:

    WHEN THE FIRST CORRESPONDENCE CONDITION IS IDENTIFIED, CORRESPOND FOR ALL MISSING REQUIRED FORMS AND/OR SCHEDULES, INCLUDING FORMS W-2, REGARDLESS OF CORRESPONDENCE TOLERANCES (with the exception of Form 1116, Form 2106, Form 8283 and Schedule 8812 and Schedule EIC) IDENTIFIED IN THE LINE-BY-LINE IRM INSTRUCTIONS.

    Note:

    Code and Edit will correspond a second time if the taxpayer sends back a return with the signature not located in the appropriate "Sign Here" area, under the jurat statement. In order for a taxpayer's signature to be valid, it MUST appear in the "Sign Here" space provided under the jurat. The only exception to this rule is when the taxpayer him/herself has signed in the wrong area and arrowed their signature to the appropriate place.

  2. DO NOT correspond when information is missing and any of the following conditions apply:

    • "Substitute for Return Prepared by IRS" is noted on the return, or the return has been "dummied" .

    • "Section 6020(b)" or "prompt assessment" is written on the return.

    • The return has a notation that it is "corrected" , "revised" , "tentative" , "amended" , or "superseding" . Also see the amended return instructions in IRM 3.11.3.7.2.1 for additional instructions.

    • An Examination case is indicated. See the instructions in IRM 3.11.3.7.1.2 for additional instructions and a list of the attachments and notations by which an Examination case may be identified.

    • The taxpayer has written "For payment only" , or included a similar statement on the return.

    • International Returns (Except AUSPC)

    • A "Hardship" case is indicated. See IRM 3.11.3.7.1.5.

    • There is an indication the return has been prepared (dummied) by Accounts Management. See IRM 3.11.3.7.2.1(2).

  3. With the exception of returns coming from Collection and Correspondence Imaging System (CIS), send an unnumbered return to the originating area indicating what information is required.

  4. Do not correspond for missing forms or schedules to support a credit or exemption claimed for a dependent when both of the following conditions apply:

    • The return was received with Form W-7 attached.

    • The ITIN application was rejected for the person who would have entitled the taxpayer to the credit and/or exemption.

      Note:

      Do not correspond for divorce decree, Form 8332, or Form 2120 when qualifying dependent(s) had the ITIN application(s) rejected.

3.11.3.6.2  (01-01-2015)
General Correspondence Procedures

  1. Request a missing secondary TIN only when other correspondence is required and the Filing Status is 2, 3, or 6.

    Exception:

    Do not request a secondary TIN when there is an indication of ITIN rejected or "NRA" .

  2. Edit all amounts on correspondence in dollars and cents and bracket negative amounts.

  3. Special additional information line editing is required any time correspondence is required on a:

    • Decedent's return - see IRM 3.11.3.10

    • Fiduciary return - see IRM 3.11.3.7.1.3

    • Minor's return - see IRM 3.11.3.7.1.3.2

  4. Dummy the caption area only on a blank front page of a return missing page 1. Research for TC150 and address if necessary.

    If Then
    An address is found and a TC150 has posted, Route the return to 1040X Unit.
    An address is not found and a TC150 has NOT posted, See IRM 3.11.3.7.2.3

3.11.3.6.2.1  (01-01-2015)
Correspondence When Sending Returns Back to the Taxpayer

  1. A valid legal signature is an original signature that appears below a jurat statement. Returns missing valid, legal signatures will be sent back to the taxpayer via Form 3531. When using Form 3531 to correspond mark Box 1 and sub-boxes a, b, c, d, and/or e as appropriate. Examine the return for other missing items and request all missing required information.

    Exception:

    KCSPC and FSPC Only: If transshipping International Returns or returns that have Form W-7 attached, do not correspond for missing signature.

    Exception:

    Do not mail back numbered or secured returns or signed returns missing documentary evidence, including fiduciary and POA returns.

  2. There are specific circumstances when Submission Processing would send a return back to a taxpayer:

    • A misfiled return. (See IRM 3.11.3.7.2.14)

    • Early filed loose Schedule H for tax year 2015. Use Notice 1208 (You Filed Schedule H (Household Employment Taxes) Too Early)

    • Current year Loose Schedule H (processed April 15, 2015 or earlier) - Use Notice 1207 (File Schedule H (Household Employment Taxes) With Your Individual Income Tax Return)

    • Missing or invalid signature(s) (See IRM 3.11.3.14.9).

    Note:

    Stop editing after identifying a missing or invalid signature and identify all other correspondence conditions.

  3. When sending the return back to the taxpayer with correspondence:

    1. Line through your TE number.

    2. Remove all Internal Documents (such as Form 3471 or Form 4227) if attached.

    3. Date stamp the correspondence with the current date. Use any IRS date stamp other than a received date stamp.

    4. Delete any IRS Received Date when mailing an unsigned return back to a taxpayer.

    5. Attach the correspondence sheet to the return immediately below the caption area.

    6. Edit an Action Trail to notate issued correspondence.

    7. Check the appropriate box(es).

    8. Remove the return from the batch and place it in the designated area.

      Note:

      Do not detach attachments when sending the return back to the taxpayer.

    9. If address is missing or incomplete, perfect from an attached envelope. If unable to perfect from an attached envelope, research.

  4. When using Form 3531:

    1. Write legibly to ensure that the taxpayer understands what information is being requested.

    2. Check the appropriate box(es).

    3. Indicate whether the tax return was received with or without remittance by checking either the "R" (Remittance) checkbox or the "N" (Non-Remittance) checkbox at the top of Form 3531.

    4. Edit or stamp "Returned for Signature" and the date in the Action Trail area of the tax return when sending the return back for missing signature.

      Note:

      A return envelope must be included with Form 3531 correspondence. No other enclosures should be included.

      Reminder:

      Delete any IRS Received Date when mailing an unsigned return back to the taxpayer.

  5. Dummy the caption area only on a blank front page of a return missing page 1. Research for TC150 and address if necessary.

    If Then
    An address is found and a TC150 has posted, Route the return to the 1040X Unit.
    An address is not found and a TC150 has NOT posted, See IRM 3.11.3.7.2.3.

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