3.11.106  Estate and Gift Tax Returns (Cont. 1)

3.11.106.5  (01-01-2014)
Computer Condition Codes (CCCs)

  1. Computer Condition Codes (CCCs) are used to identify a special condition or computation to post to the master file.

  2. CCCs are edited in the upper left corner of the return for all Estate and Gift Tax (Form 706 and Form 709 series) returns.

  3. The following common CCCs will be used on all documents input to the BMF:

    Code Explanation
    A 2010 (ONLY) revision (with a 2010 tax period) of Form 709
    B Victims of Terrorism Relief
    D Reasonable Cause For Failure to Pay Taxes Timely
    F Final Return
    G Amended, superseding, duplicate, tentative, revised, substitute
    L Treaty based positions. IRC 6114 written on Form 706, Form 706-NA, and Form 709
    O Form 3753 and Form 5792, Module Freeze - indicates a manual refund was issued
    R Reasonable cause for delinquency
    U Unprocessable document
    W Indicates the return has been cleared by Statute Control
    X Credit freeze
    Y Combat zone return, early filed return, Form 709 returns under Revenue Ruling 71-132, and Form 709 returns filed by non-residents who are not citizens
    3 No reply to correspondence
    7 Reasonable Cause Statement Denied

  4. Since all CCCs are not valid for each (and every) Form 706 and Form 709 series return, consult the following sections, as appropriate, before editing a code for the specific (type of) return being processed. Tax examiners code various documents for input to the BMF.

3.11.106.5.1  (01-01-2014)
CCC "A" - 2010 (ONLY) revision (with a 2010 tax period) of Form 709

  1. Edit CCC "A" to identify 2010 (ONLY) revisions (with a 2010 tax period) of Form 709 if there are any dollar amount entries (other than zero) anywhere on Page 2, Schedule A, Parts 2 or 3, or on Page 4, Schedule C (other than Exemption amounts (only) shown in Part 2, Lines 1, 3, and/or 8).

    Caution:

    DO NOT edit CCC "A" if return is other than 2010 revision of Form 709.

3.11.106.5.2  (01-01-2014)
CCC "B" - Victims of Terrorism Relief

  1. Edit this code to identify Form 706 containing references or indications the return was for the estate of a victim killed in a terrorism attack.

  2. If a Form 706 return is annotated at the top of Page 1 of the return "Section 2201" or has any indications the return is the result of legislation impacting victims of terrorist attacks (April 19, 1995 - Oklahoma City bombing; September 11, 2001 - World Trade Center bombing; or references to deaths resulting from anthrax that occurred on or after September 11, 2001, and before January 1, 2002):

    1. Edit CCC "B" .

    2. A special tax rate schedule will apply to victims of terrorist attacks. ERS/Rejects will verify the appropriate tax computation.

    3. Apply all other credits against the estate tax (including unified/applicable credit) to these returns.

3.11.106.5.3  (01-01-2014)
CCC "D" - Reasonable Cause For Failure to Pay Taxes Timely

  1. We will no longer code CCC "D" if the taxpayer requests abatement for Failing to Timely Pay Taxes when the return is submitted.

    Note:

    In the case of a disaster, specific instructions for the use of this code will be provided at that time.

  2. For Form 706 and Form 709 series returns, the Cincinnati Compliance Services, Estate and Gift Tax Campus Operation will make a determination regarding reasonable cause and assess any penalty(ies), etc., against the account, if applicable. They have determined the return(s) should be processed through the pipeline (without delay) while they are making their determination of reasonable cause and assessments of applicable penalties.

  3. The following instructions apply for handling of Form 706 and Form 709 series returns:

    1. Make a photocopy of Pages 1 and 2 of the return.

    2. Detach the taxpayer's statement from the return.

    3. Attach the photocopy of the return and the taxpayer's statement to Form 4227, Intra-SC Reject or Routing Slip, and route to the Cincinnati Compliance Services, Estate and Gift Tax Campus Operation.

    4. Continue normal processing of the (original) return.

  4. If a Cincinnati Compliance Services, Estate and Gift Tax Campus Operation representative visits Code and Edit for an on-site review for determination(s) of reasonable cause, proceed as follows:

    1. Edit the appropriate CCC on the return per Compliance Services' instructions.

    2. Continue normal processing of the return.

3.11.106.5.4  (01-01-2014)
♦CCC "F" - Final Return♦

  1. Edit CCC "F" when the taxpayer:

    1. States "final" on the return or attachments.

    2. Gives a positive indication that they are not liable for filing future returns. Notations such as (but not limited to):

    • Final

    • Deceased

    • Out-of-Business

    • Liquidation

    • Exempt under IRC 501(c)(3)

    • Dissolved

  2. CCC "F" on Form 709 indicates this is the last return of a donor who died.

3.11.106.5.5  (01-01-2014)
CCC "G" - Amended Return

  1. See IRM 3.11.106.5.5.1 Amended Returns.

3.11.106.5.5.1  (01-01-2014)
Amended Returns

  1. Form 706 and Form 709 series returns do not contain "amended boxes" . However, the return might include some written indication by the taxpayer (or their representatives) that there has been a change since the original return was submitted. Examples of this are such words as "Supplemental" , "Duplicate" , "Additional" , or any other positive indication that the taxpayer has filed previously.

  2. Examine the return for attachments. Do not separate any related attachments from the return that the taxpayer has submitted to explain the reason for the amended return. This information will be useful by Accounts Management. Detach any unrelated documents and route them to the appropriate function using Form 4227, Intra-SC Reject or Routing Slip. Edit Action Trail on the return.

    Note:

    For Form 706 and Form 709 series returns, do not detach any attachments.

  3. There is an indication the return is amended and:

    If Then
    "TC 59X" or "ICS" was entered on the return by Compliance Services Do not edit CCC "G" . Process the return as an original.
    The return is stamped "Delinquent Original Cleared for Processing" by Statute
    Form 3893 or Form 13596 is attached 1. Do not edit CCC "G" .
    2. See IRM 3.11.106.2.4.2, Form 13596, Reprocessing Returns.
    None of the above are present Edit CCC "G" . No other codes may be used with CCC "G" except CCC "U" , "W" , "3" and/or ERS Action Code.

  4. Form 706 and Form 709 series returns: Receipt and Control will sort non-remittance amended Form 706 and Form 709 series tax returns and forward returns with a domestic or foreign (international) address to Cincinnati Compliance Services, Estate and Gift Tax Campus Operations. The following instructions pertain to Forms 706, 706-GS(D), 706-GS(T), 706-QDT, 709.

    If And Then
    Return (without remittance) is marked "Amended" , "Revised" , "Adjusted" , "Subsequent" , "Substitute" , "Corrected" , etc. Domestic or foreign (international) address (Block 3a, Form 706, or Block 5, Form 709) 1. Consider the return as amended.
    2. Route to Cincinnati Compliance Services, Estate and Gift Tax Campus Operations.
    Return (with remittance) is marked "Amended" , "Revised" , "Adjusted" , "Subsequent" , "Substitute" , "Corrected" , etc. Unnumbered return with domestic or foreign (international) address 1. Consider the return as amended.
    2. Route to Cincinnati Compliance Services, Estate and Gift Tax Campus Operations.
    3. Hand carry return and remittance to supervisor.
    Numbered return with domestic or foreign (international) address 1. Route to Cincinnati Compliance Services, Estate and Gift Tax Operations.
    2. Use Action Code 370 (Exam).
    3. Leave the return in the batch.

  5. See IRM 3.11.106.11.7, for processing amended Form 706-NA.

  6. The following data must be edited on all amended returns:

    • Name Control

    • Social Security Number (SSN)

    • Date of Death (or, Tax Period)

    • CCC "G"

    • IRS received date

    • Signature

3.11.106.5.6  (01-01-2014)
♦CCC "L" - Treaty Based Positions♦

  1. Edit CCC "L" when the taxpayer has written "IRC 6114" on the top of the return or Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b), is attached to the return.

    Note:

    This applies only to Form 706, Form 706-NA, and Form 709.

3.11.106.5.7  (01-01-2014)
♦CCC "O" - Module Freeze♦

  1. CCC "O" is edited when a Pre-Settlement Manual Refund will be made and a Form 3753, Manual Refund Posting Voucher; Form 5792, Request for IDRS Generated Refund (IGR); or Form 12857, Refund Transfer Posting Voucher, is attached. Verify that the Name Control, SSN, and Tax Period on the return is the same as the data on the form.

  2. When issuing CCC "O" :

    1. Research to determine if TC 840 (Manual Refund Transaction) has posted.

    2. If TC 840 has posted, enter CCC "O" and process as usual.

    3. If TC 840 has not posted, enter Action Code 341 to issue a manual refund.

    If Then
    A completed Form 3753, Manual Refund Posting Voucher; Form 5792, Request for IDRS Generated Refund (IGR); or Form 128577, Refund Transfer Posting Voucher, is attached to the return. (These indicate that a pre-settlement manual refund was made.) Edit CCC "O" .
    (The freeze is released by posting Transaction Code "840" .)

3.11.106.5.8  (01-01-2014)
CCC "R" - Reasonable Cause for Delinquency

  1. We will no longer code CCC "R" if the taxpayer requests abatement for Failing to Timely File when the return is submitted.

    Note:

    In the case of a disaster, specific instructions for the use of this code will be provided at that time.

  2. See IRM 3.11.106.10.3.2 if a Form 706 is received with an original Form 709 with an approved extension of time to file.

  3. For Form 706 and Form 709 series returns, the Cincinnati Compliance Services, Estate and Gift Tax Campus Operation will make a determination regarding reasonable cause and assess any penalty(ies), etc., against the account, if applicable. They have determined the return(s) should be processed through the pipeline (without delay) while they are making their determination of reasonable cause and assessments of applicable penalties.

  4. The following instructions apply for handling of Form 706 and Form 709 series returns:

    1. Make a photocopy of Pages 1 and 2 of the return.

    2. Detach the taxpayer's statement from the return.

    3. Attach the photocopy of the return and the taxpayer's statement to Form 4227, Intra-SC Reject or Routing Slip, and route to the Cincinnati Compliance Services, Estate and Gift Tax Campus Operation.

    4. Continue normal processing of the (original) return.

    Note:

    All "R" coded returns must have an IRS received date. If one is not present, enter the date in the middle of the return.

  5. If a Cincinnati Compliance Services, Estate and Gift Tax Campus Operation representative visits Code and Edit for an on-site review for determination(s) of reasonable cause, proceed as follows:

    1. Edit the appropriate CCC on the return per Cincinnati Compliance Services, Estate and Gift Tax Campus Operation instructions.

    2. Continue normal processing of the return.

3.11.106.5.9  (01-01-2014)
CCC "U" - Unprocessable Conditions

  1. Edit CCC "U" on any return that has an unprocessable condition. This applies only to the Form 706-GS(D) and Form 706-GS(T).

    Note:

    All returns will receive CCC "U" except Form 706, Form 706-NA, and Form 709.

  2. For Form 706, Form 706-NA, and Form 709, see IRM 3.11.106.2.3, Unprocessable Conditions-Form 706 and Form 706-NA, for the appropriate Action Code to use for unprocessable conditions.

3.11.106.5.10  (01-01-2014)
♦CCC "W" - Return "Cleared by Statute" ♦

  1. CCC "W" is used when the return has been cleared by Statute Control. (See IRM 3.11.106.5.10.1, Statute Returns.)

3.11.106.5.10.1  (01-01-2014)
♦Statute Returns♦

  1. Any return with an IRS received date that is 2 years and 9 months or more after the return due date is a potential statute control return. Identify and treat statute control returns as unprocessable.

  2. Statute returns must be routed to the Statute Control Unit daily or more often if needed.

    Exception:

    Do not route to Statute Control Unit for clearance, edit a CCC "W" and continue processing, if any of the following conditions are present:

    • Compliance (Section 6020(b)) returns.

    • A return with TC 59X or ICS notated on the face of the return.

    • Returns that are substitute returns prepared by Exam (SFR in top margin) with Form 13133, Expedite Processing Cycle, attached.

    • The return has a stamp that indicates a previous clearance by Statute Control within the last ninety days.

    • Tax returns that are secure by Exam ("Process as Original" is notated on Page 1).

  3. Statute returns are unprocessable until they are cleared by Statute Control:

    If Then
    The return is numbered 1. Edit Action Code 310 on the return (Form 706, Form 706-NA, and Form 709). For all other forms (including, but not limited to Form 706-A, Form 706-D, Form 706-QDT, Form 706-GS(D), and Form 706-GS(T), edit CCC "U" on the return.
    2. Leave the return in the batch and continue processing.
    The return is unnumbered 1. Do not continue processing.
    2. Pull the return from the batch.
    3. Attach Form 4227 and route to Statute Control Unit.

  4. Edit CCC "W" if the return has been cleared by Statute Control Unit. Statute will stamp or indicate clearance on the front of the return.

  5. Statute may stamp a return as "No Statute Issue" . Follow the table below to determine if a CCC "W" is needed:

    If And Then
    The return received date is 2 years and 9 months or more after the return due date The return is stamped, “No Statute issue” Edit a CCC W.
    The return received date is less than 2 years and 9 months from the return due date The return is stamped, “No Statute issue” Do not edit a CCC W.

3.11.106.5.11  (01-01-2014)
CCC "X" - Return Settlement Frozen

  1. Edit CCC "X" :

    If Then
    Taxpayer has requested part of the refund be applied to another account 1. Edit CCC "X" .
    2. Photocopy Pages 1 and 2 of the return.
    3. Prepare Form 3465, Adjustments Request. Attach photocopy and forward to Accounts Management.
    4. Notate "Form 3465 Prepared" on original return.
    There is "no reply" to a correspondence and a refund is due Edit CCC "3" as well.

3.11.106.5.12  (01-01-2014)
CCC "Y" - Designates a Yield Condition

  1. The CCC "Y" is used by different programs to designate a "yield" condition (and is used by other BMF programs to represent a change in the accounting period). However, for the Form 706 and Form 709, CCC "Y" designates a yield condition for 4 entirely different reasons.

  2. Edit a CCC "Y" when either of the following conditions apply:

    • It is an "Assistance Needed/Special Handling" return. (2011 Form 706 with a Date of Death in 2011 only.)

    • It is a "Combat Zone" return. (Form 706 series only.)

    • It is an "Early Filed" return. (Form 709 only.) See (4) below.

    • It is a "Form 709 from a non-resident alien taxpayer" .

    • If the W&I Submission Processing Liaison for TAS issues walks a return through Code and Edit; then, in addition to normal editing: (1) Edit CCC "O" to freeze the refund and (2) Edit CCC "Y" to route the return to ERS. See IRM 3.11.106.1.5, Taxpayer Advocate Service (TAS).

  3. The following information pertains to Combat Zone returns:

    If Then
    A decedent is killed in action or died as a result of wounds, disease or injury received while serving in a Combat Zone 1. Edit CCC "Y" .
    2. The decedent is entitled to lower estate tax per IRC 2201 and 2011(d).
    3. The tentative tax equals 125% of the maximum allowable state death tax credit.
    4. All other credits against estate tax (including unified/applicable credit) apply to these returns.

  4. The following information pertains to "Early Filed remittance returns" :

    If Then
    A gift was given the same year the return is filed, but is not due until April 15th of the following year (e.g., a gift is given in 2012, the return was filed in 2012, and the return is due April 15, 2013)
    1. Edit CCC "Y" .
    2. The return cannot be processed until after December 31, 2012; post it as the month actually received. For example, if the return is received in January 2012, post it as 1201, etc.
    3. This applies to remittance returns. (See Figure 3.11.106-5.)

    Figure 3.11.106-5

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

    Computer Condition Code

  5. Edit a CCC "Y" on Forms 709 filed by non-residents who are not United States citizens.

3.11.106.5.13  (01-01-2014)
♦CCC "3" - No Reply to Correspondence-Suppress Credit Interest♦

  1. Edit CCC "3" when either the taxpayer fails to respond to correspondence or when correspondence is returned undeliverable. It will suppress credit interest from being generated.

3.11.106.5.14  (01-01-2014)
CCC "7" - Reasonable Cause Statement Denied

  1. The Cincinnati Compliance Services, Estate and Gift Tax Campus Operation, will make all determinations of reasonable cause for all Form 706 and Form 709 tax returns.

  2. If a Compliance Services representative visits Code and Edit for an on site review for determination(s) of reasonable cause, proceed as follows:

    1. Edit the appropriate CCC on the return per Compliance Services instructions.

    2. Continue normal processing of the return.

    Note:

    Unless Examination has determined that an on site visit by Compliance Services personnel is needed, there will be no need to determine whether a CCC "7" is appropriate or not.

3.11.106.6  (01-01-2014)
Taxpayer Correspondence General

  1. All Taxpayer Correspondence is governed by the guidelines in IRM 1.15.29, Records Control Schedule for Submission Processing Campus Records, which includes:

    1. All written communication from a taxpayer or his/her representative, excluding tax returns, whether solicited or unsolicited.

    2. Written communication which requests information, including requests attached to tax return.

    3. Written communication, including annotated notice responses, that provide additional information or dispute a notice.

  2. A written referral resulting from taxpayer telephone contact or walk-in inquiry (although not included in the definition of taxpayer correspondence) should be handled in adherence to the guidelines contained in IRM 1.10.1, The IRS Correspondence Manual.

  3. Unnumbered amended returns (i.e., Form 1040X, Form 1120X, etc.), although not included in the definition of taxpayer correspondence, should be handled in adherence to the guidelines contained in IRM 1.10.1, The IRS Correspondence Manual.

  4. Timeliness guidelines for acknowledging and working taxpayer correspondence as outlined in IRM 3.30.123, Processing Timeliness: Cycles, Criteria and Critical Dates, must be followed.

3.11.106.6.1  (01-01-2014)
♦Correspondence♦

  1. Issue correspondence to resolve any conditions causing the return to be unworkable or unprocessable.

    Exception:

    Do not correspond or send back returns prepared by Compliance (6020(b) and SFR).

  2. Examine the return so that all of the conditions can be included in the same correspondence.

  3. Follow the instructions below when correspondence is needed.

    If And Then
    Correspondence is needed requires a response 1. Complete Form 3696 or other approved Correspondence Action Sheet indicating the letter number, Master File Tax (MFT), and the appropriate paragraphs.

    Note:

    Within these paragraphs there may be fill-ins that the tax examiner will be required to enter, such as tax period, form number, DLN, etc.


    2. Attach Form 3696 or other approved Correspondence Action Sheet to the front of the return below the Entity area.
    3. Edit Action Code 211 on Form 706, Form 706-NA, and Form 709. Use CCC "U" for all other returns.
    4. Continue editing the return and leave the return in the batch.
    Correspondence is needed does not require a response 1. Complete Form 3696 or other approved Correspondence Action Sheet indicating the letter number, MFT, and the appropriate paragraphs.

    Note:

    Within these paragraphs, there may be fill-ins that the tax examiner will be required to enter, such as tax period, form number, DLN, etc.


    2. Photocopy and attach Form 3696 or other approved Correspondence Action Sheet below the Entity areas on the front of the return. Be sure the name and address shows clearly above the Form 3696 or other approved Correspondence Action Sheet.
    3. Forward the copy to the Correspondence area.
    4. Edit an Action Trail (e.g., "180C SENT" ) in the lower left corner going vertically up the side of the return.
    5. Finish editing the return and leave in batch.

    Note:

    There may be additional letters that are exclusive to the Tax Examiner's campus. These letters are for specific forms or conditions where it was deemed necessary for ease of processing. The Tax Examiner should go to their manager for copies of these letters to facilitate processing.

3.11.106.6.2  (01-01-2014)
Fact of Filing - Transaction Code 59X

  1. The following information pertains to TC59X:

    If Then
    An unnumbered return is withdrawn from the workflow for correspondence 1. Input through IDRS, (no later than 3 weeks before the delinquency check) a fact of filing to alter the normal delinquency check.
    2. Annotate the transaction and closing codes input in the middle left margin of the return.
    3. Using Command Code FRM49BB, the codes are as follows:
     a. TC 599-17 Unprocessable Tax Return.
     b. TC 599-18 Return in progress on or after the program completion date.
    The return is being sent back to the taxpayer The above instructions do not apply. TC 599 is not necessary.

3.11.106.6.3  (01-01-2014)
♦Use of Fax for Taxpayer Submissions♦

  1. Tax return information can be received via fax as part of return perfection even if a taxpayer signature is required. In circumstances where contact with the taxpayer has been made and documented, fax signatures are acceptable.

  2. Contact with the taxpayer may be by telephone or correspondence. Follow local procedures to determine which method of contact will be used.

  3. Code and Edit examiners will indicate the fax paragraph on the Form 3696, Correspondence Action Sheet, to advise taxpayers of the option to fax their response.

    Caution:

    Before disclosing any tax information, you must be sure you are speaking with the taxpayer or authorized representative. See the Taxpayer Authentication guidelines in IRM 21.1.3, Operational Guidelines Overview. Also, before leaving any messages on a taxpayer's answering machine, review IRM 11.3.2.6.1, Leaving Information on Answering Machines/Voice Mail. Fax procedures contained in IRM 11.3.1.11, Facsimile Transmission of Tax Information, must be reviewed prior to faxing confidential information to the taxpayer.

3.11.106.7  (01-01-2014)
General Editing Guidelines

  1. General instructions eliminate repetition of the same instructions for each return. If the general instructions and the specific instructions conflict, follow the specific instructions.

  2. Do not edit a vertical line, 00, dash or decimal point in a dollars and cents field when the taxpayer has entered dollars only.

  3. Do not edit brackets or parentheses around amounts clearly indicated to be negative by the presence of a minus sign (-).

    Reminder:

    It will be necessary to bracket negative amounts when editing negative entries on transcription lines (i.e., computing and entering a line entry, entering a missing line entry, etc.).

  4. Received date is edited in MMDDYY format.

  5. Document Perfection should arrange Pages 1, 2, 3, and 4 of Form 706 in sequential order to facilitate transcription entry.

  6. If a current/prior year return is filed on a tax form for other than the appropriate tax year, convert the tax return to the current year format using the prior year conversion tables.

  7. If a current year return is filed on a 2005 or prior year tax form, renumber the prior year return to comply with current year line numbers.

  8. If a current year tax form is used to report prior year tax information, edit the tax period to reflect the prior year.

  9. If the prior year return is filed on the correct/incorrect tax form, renumber the prior year form to current year format.

3.11.106.7.1  (01-01-2014)
♦Edit Marks♦

  1. Edit marks are edited on the return for transcription to the ADP System through Integrated Submission and Remittance Processing (ISRP). The editing can be entered in brown, red, orange, purple or green pencil/pen.

  2. The only items edited on the return are those to be transcribed except where specific instructions require editing of a non-transcribed item. Lines are left blank if the entry would be a zero amount unless otherwise instructed.

  3. The original entry on a return is never obliterated, altered or erased when deleting or correcting an entry. Always exercise care to ensure that the original entry remains legible. Perfected entries provide a legible "edit trail" for anyone who may work with the return later.

  4. For a description of specific edit marks, see the table below:

    Edit Mark Description
    "X" The "X" is used to delete tax data or to indicate that an item is not to be transcribed.
    "/" A "/" can be used when deleting a form or schedule not being transcribed.
    "//$" The "//$" is used in the entity area to identify the beginning and ending of a foreign country code. For example, "/EI/$" is edited for Ireland and "/GM/$" is edited for Germany.
    "c/o" or "%" Indicates an "in-care-of" name for transcription.
    Circle Indicates that an entry is not to be transcribed. Also used to delete Entity data or a received date.

    Note:

    If the taxpayer circles an entry, edit the entry.

    Underline Indicates that an entry is to be transcribed (e.g., name control, tax period and a received date that is other than an IRS stamped date).
    Arrow Indicates the correct placement of a misplaced entry. An arrow may be used if the misplaced item is close to the correct line and there is no question where the entry belongs.

    Note:

    A double arrow may be used if the same figure is to be transcribed in two different places (along with any required transcription data between the two arrows).

    Check Mark Indicates that an entry has been manually math verified and is correct.
    Bracket/Parenthesis Indicates a negative numerical amount.

    Note:

    Code and Edit is not required to bracket negative amounts when brackets are preprinted on the form or schedule or when the taxpayer clearly indicates a negative amount with brackets or minus sign (-). It will be necessary to bracket negative amounts when editing negative entries on transcription lines (i.e., computing and entering a line entry, entering a missing line entry, etc.).

    Vertical Line or Decimal Point Indicates the separation of dollars and cents if no distinction has been made by the taxpayer.
    Zero, Dash, None or N/A "ZERO" , "DASH" "NONE" or "N/A" are considered valid entries except when specific instructions require editing of an entry.
    Edit Marks Made by Other IRS Functions Edit marks entered by another area, such as Collections or Accounts Management, are not to be re-edited except to place the marks in the correct area.
    Rocker Indicates the amount paid when drawn under a remittance amount.

3.11.106.8  (01-01-2014)
♦Received Date♦

  1. The date a document is received in the Campus or IRS Office is the date stamped as the "IRS Received Date" .

  2. An IRS received date is required on all Form 706 and Form 709 series tax returns.

  3. A return is considered timely if it is postmarked on or before the due date.

    If And Then
    The return is received within ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ the extended due date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡   The return is considered timely.
    The due date falls on a weekend or legal holiday   The return is timely if postmarked by the first business day following the weekend or legal holiday.
    The IRS received date stamp ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ The postmark or shipment date is on or before the due date Edit the IRS received date to agree with the postmark or shipment date.

    Note:

    If an extension form is attached (or an indication that an extension was filed), the return due date will be the approved extension date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

  4. An application for extension of time for filing (Form 4768) may be granted even if application is made later than 9 months after Date of Death. Unless executor is abroad, extended due date for filing estate tax return may not be later than 15 months from date of decedents death.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 Decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the Executor of a 2010 Estate who files a Form 4768 by the due date for filing Form 706 or Form 706-NA both an automatic six month extension of time to file Form 706 or Form 706-NA pursuant to Section 6081, and a six month extension of time to pay the estate tax. The Executor of a 2010 Estate is not required to substantiate on the Form 4768 the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the Executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768), justification needs to be provided.

  5. The IRS received date may or may not be stamped on the face of the return.

  6. A valid IRS received date stamp consists of the following:

    1. The word "Received" .

    2. Month (alpha or numeric)

    3. Day (for example, "1" or "01" .

    4. Year ~ four digits.

    5. "Area Office" , Campus, "Field Office" , "Taxpayer Assistance Center (TAC)" Site, plus the City location or a functional area within one of these sites (e.g., Exam, AM, etc.).

      Exception:

      The TAS organization is not a point of filing and TAS employees have not been delegated the authority to accept returns for filing. Treat all TAS received dates as invalid by circling them and edit the received date according to instructions.

  7. If the IRS received date stamp is not present, or the date is illegible or invalid, edit the received date in MMDDYY format in the middle of the first page of the return. Determine the IRS received date in the following priority:

    1. Earliest postmark (U.S. Postal Service, Foreign postmark, or Private Delivery Service) on the envelope. Rules for using the U.S. Postal Service Postmark (USPS) or foreign postmark date are as follows:

      If Then
      An envelope is not attached Use the postmark date stamped on the face of the return.
      An envelope has a USPS and private metered postmark Always use the USPS postmark.
      An envelope has a foreign and private metered postmark Always use the foreign postmark.
      An envelope has two private metered postmarks Always use the latest private postmark.
      An envelope has only one private metered postmark Use the private metered postmark.

      Note:

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

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

    3. Revenue Officer's signature date.

    4. Signature date (ONLY if within current year).

    5. Julian date minus 10 days in the DLN.

    6. Today's (current) date minus 10 days.

  8. Edit the received date as follows:

    If And Then
    A timely IRS received date is the only received date stamped on the return   No editing is required.
    Two or more dates are stamped on the return   1. Use the earliest IRS date stamp.
    2. Circle out all other dates.
    A federal return is addressed to the IRS Delivered to a state agency Use the postmark date as the received date.
    A federal return is addressed to a state agency   Use the IRS date stamp as the received date.
    The only received date on the return is a TAS received date   Edit the received date according to instructions above.

    Note:

    If an envelope is attached to the return, check the envelope for remittance. If found, hand carry remittance to manager.

3.11.106.8.1  (01-01-2014)
♦Signature♦

  1. A signature and jurat is required on all returns except the following:

    1. Returns prepared under IRC 6020(b). These returns must be signed by a Compliance Function Representative.

      Note:

      Starting July 1, 2013, we will accept a revenue officers electronic signature or typed signature as a valid signature on the return.

    2. Returns prepared by Examination, i.e., SFR (Substitute For Return).

    3. Dummy returns prepared by IRS.

    4. Correspondence containing a signature and jurat is attached showing that the taxpayer is responding to an IRS notice or letter.

  2. Follow the instructions below if the return is not signed on the line designated for the taxpayer's signature.

    If Then
    The return is not signed on the line designated for the taxpayer's signature 1. Edit Action Code 225 or Action Code 226 if corresponding for signature only.
    2. Leave in batch and continue processing.
    The jurat is not present on the line designated for the taxpayer's signature (non-standard return) 1. Edit Action Code 225 or Action Code 226 if corresponding for signature only.
    2. Leave in batch and continue processing.

  3. See IRM 3.11.106.2.3.4 for frivolous returns instructions if the jurat is altered or stricken (crossed out).

  4. Accept a "signature declaration" (a signature with jurat obtained through IRS correspondence) if attached to the return.

    1. See IRM 3.11.106.2.3.4 for frivolous returns instructions if the "signature declaration" is altered or stricken (crossed out).

    2. If the taxpayer responds with a self-prepared signature declaration, it must contain the same language as the jurat on the tax return; i.e., "UNDER PENALTIES OF PERJURY, I DECLARE THAT I HAVE EXAMINED THIS RETURN, INCLUDING ACCOMPANYING SCHEDULES AND STATEMENTS, AND TO THE BEST OF MY KNOWLEDGE AND BELIEF, IT IS TRUE, CORRECT AND COMPLETE. DECLARATION OF PREPARER OTHER THAN THE EXECUTOR (Form 706) DONOR (Form 709) IS BASED ON ALL INFORMATION OF WHICH PREPARER HAS ANY KNOWLEDGE" .

  5. Since tax examiners are not expected to be handwriting experts, Section 6064 of the Regulations allows the Service to presume that the signature on a return, statement or other document is the true signature of the person who actually signed the document.

    Note:

    A check mark ("✓" ) or "X" used to designate where the taxpayer should sign the return is not considered a valid signature.

  6. Only one correspondence attempt is required for a signature.

3.11.106.8.2  (01-01-2014)
♦Paid Preparer Section♦

  1. The Paid Preparer section is located below the Signature area at the bottom of Forms 706, 706-NA, 706-GS(D), 706-GS(T), and 709.

3.11.106.8.2.1  (01-01-2014)
♦Paid Preparer Checkbox Indicator (Form 709 only)♦

  1. The Paid Preparer Checkbox is located next to the taxpayer signature area on Form 709. It indicates whether the taxpayer has elected to allow the Paid Preparer to answer questions about the return as it is processed.

  2. No action is required on amended returns.

  3. Take the following actions when an entry is present in the Paid Preparer Checkbox on Form 709:

    If Then
    The "Yes" box is checked Take no action.
    The "No" box is checked; neither box is checked; or, both boxes are checked Circle the Paid Preparer's Phone Number, if present.

3.11.106.8.3  (01-01-2014)
♦Paid Preparer's Tax Identification Number (PTIN)♦

  1. The Preparer's Social Security Number (SSN) (2009 and prior revisions) or Preparer Tax Identification Number (PTIN) is located to the right of the Preparer's signature in the PTIN box (Preparer's SSN or PTIN box for 2009 and prior revisions) at the bottom right corner of Forms 706, 706-NA, 706-GS(D), 706-GS(T), and 709 (Page 1).

  2. No action is required on amended returns.

  3. The Preparer's SSN is a nine digit number. Circle the SSN if all zeros or nines.

  4. A PTIN begins with the alpha "P" followed by an eight digit number (e.g., PXXXXXXXX). Circle the PTIN if all zeros or nines.

3.11.106.8.4  (01-01-2014)
♦Firm's EIN♦

  1. The Firm's EIN (EIN for 2009 and prior revisions) is located below the Preparer's PTIN box (Preparer's SSN or PTIN box for 2009 and prior revisions) at the bottom right corner of Forms 706, 706-NA, 706-GS(D), 706-GS(T), and 709 (Page 1).

  2. No action is required on amended returns.

  3. The Firm's EIN is a nine digit number. Circle the EIN if all zeros or nines.

3.11.106.8.5  (01-01-2014)
♦Paid Preparer Phone Number♦

  1. The Paid Preparer's Phone Number is located below the Firm's EIN (EIN for 2009 and prior revisions) at the bottom right corner of Forms 706, 706-NA, 706-GS(D), 706-GS(T), and 709.

  2. No action is required on amended returns or if the number is more than 10 digits.

  3. If the Paid Preparer's Phone Number is illegible or less than 10 digits, circle the phone number.

3.11.106.8.6  (01-01-2014)
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

3.11.106.8.6.1  (01-01-2014)
≡ ≡ ≡ ≡ ≡ ≡ ≡

  1. All received dates on every Form 706 with an amount greater than zero on Line 18, Page 1, Part 2, must be verified using the following table:

    Note:

    Form 706 is due exactly 9 months to the day of the Date of Death.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 Decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the Executor of a 2010 Estate who files a Form 4768 by the due date for filing Form 706 or Form 706-NA both an automatic six month extension of time to file Form 706 or Form 706-NA pursuant to Section 6081, and a six month extension of time to pay the estate tax. The Executor of a 2010 Estate is not required to substantiate on the Form 4768 the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the Executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768), justification needs to be provided.

    If Then
    The form is date stamped ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    The date shows legal timely mailing without regard to a due date falling on Saturday, Sunday or holidays Change the IRS received date to the postmark date.
    Estate and Gift Tax returns are erroneously addressed to state agencies Returns will be date stamped when received with current IRS received date.
    Returns that were correctly addressed but erroneously delivered by the U.S. Postal Service to a state agency If original envelope bears timely postmark or timely date stamp by the state agency, return will be considered timely filed.
    Envelope was erroneously addressed DO NOT change the IRS date stamp.
    More than one date is stamped 1. Use the earliest date.
    2. Circle out all other dates.
    Entering received date on return See exhibits for where to enter received date
    1. Form 706, see Exhibit 3.11.106-1.
    2. Form 709, see Exhibit 3.11.106-4.
    Return is received ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ envelope postmark was on or before the due date of the return Consider the return timely and change the IRS received date to the postmark date.

    (For example: If the return is due July 1, and:
    1. Received stamped ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ or
    2. Received stamped ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ June 30, return is timely filed.)

3.11.106.8.7  (01-01-2014)
♦Tax Period♦

  1. All returns must have a tax period. Edit the tax period at the top of the form for Form 706-GS(D); Form 706-GS(T); and Form 709only, in YYMM format.

    If Then
    The return is for the current processing year No editing is necessary.
    The taxpayer has notated a tax period other than the preprinted year on the return (this is not a current year return) Edit the tax period based on the taxpayer's indication.
    The tax period is missing, incomplete, or illegible 1. Review the return or attachments for the correct period.
    2. If found, edit the tax period to the right of the form (in the area under the form title) in YYMM format.
    3. If unable to determine the tax period after searching the return and attachments, process the return for year currently being processed.

  2. The following information pertains to tax period editing for Forms 706-GS(D), 706-GS(T), and 709:

    If Then
    Editing tax period 1. Do not edit the tax period on Forms 709, 706-GS(D) and 706-GS(T), if it is for the current tax period.
    2. If editing is required (for other than the current tax period), edit at the top of the return in "YYMM" format.

3.11.106.8.7.1  (01-01-2014)
♦Tax Period - Early Filed Returns♦

  1. An Early Filed Return is defined as a return whose IRS received date is prior to the tax period ending date.

  2. Never send back an Early Filed return to the taxpayer.

    If Then
    The return is early filed and is not a "Final" 1. Edit CCC "U" or Action Code 480.
    2. Route the return to Rejects, using Form 4227, Intra-SC Reject/Routing Slip, to suspend the return.
    The return is early filed and a "Final" Edit CCC "F" .
    Early Filed Return Without Remittance 1. Edit CCC "U" or Action Code 480 on the return.
    2. Attach Form 4227 and note "Early Filed" .
    3. If unable to determine tax period, prepare Form 3696, or other approved Correspondence Action Sheet, to correspond for the correct tax period.
    a. If the taxpayer replies that the tax period is correct as it was originally filed, (i.e., Form 706-GS(D) or Form 706-GS(T)) suspend the return until January of the year due.
    b. If there was NO reply to correspondence, suspend the return until January of the year due.
    c. If the taxpayer replies that the form (i.e., Form 706-GS(D) or Form 706-GS(T)) was for the previous year, correct the tax period 0X12, delete CCC "U" or Action Code, and process the return.
    Early Filed Return With Remittance 1. Edit CCC "U" or Action Code 480 on the return.
    2. Attach Form 4227 and note "Early Filed" .
    3. If unable to determine tax period, prepare Form 3696 or other approved Correspondence Action Sheet. Attach to the front of the form (i.e., Form 706-GS(D) or 706-GS(T)) and leave it in the block to correspond for the correct tax period.
    a. If the taxpayer replies that the tax period is correct as it was originally filed, (i.e., Form 706-GS(D), or Form 706-GS(T)) suspend the return until January of the year due.
    b. If there was NO reply to correspondence, suspend the return until January of the year due.
    c. If the taxpayer replies that the return was for the previous year, correct the tax period 0X12, delete CCC "U" or Action Code, and process the return.
    4. If a remittance is attached, give to your manager.

  3. See IRM 3.11.106.15.6 Tax Period-Form 709, for instructions for tax period editing of Forms 709.

3.11.106.9  (01-01-2014)
Entity Perfection - General

  1. The entity of a tax return identifies the taxpayer on the business master file. The entity area of the return contains the following:

    1. Social Security Number (SSN)

    2. Name

    3. "In-care-of" name

    4. Address

3.11.106.9.1  (01-01-2014)
Entity Perfection - Social Security Number (SSN)

  1. The SSN is a 9 digit number (XXX-XX-XXXX) assigned to identify the taxpayer.

  2. Determine the SSN as follows:

    If And Then
    SSN is missing You can determine the correct SSN from the attachments and/or schedules Edit the SSN to the appropriate location.
    The SSN is either a PTIN or Individual Taxpayer Identification Number (ITIN) Unnumbered 1. Remove return from batch.
    2. Attach Form 4227, Intra-SC Reject or Routing Slip, or follow local procedures.
    3. Forward to Entity Control for SSN assignment.
    Numbered 1. Edit Action Code 320.
    2. Attach Form 4227 for routing to Entity Control and leave document in batch.
    Multiple SSNs are present Unnumbered 1. Remove return from batch.
    2. Attach Form 4227 or follow local procedures.
    3. Forward to Entity Control for SSN assignment.
    Numbered 1. Edit Action Code 320.
    2. Attach Form 4227 and leave in the batch.
    The SSN contains any of the following conditions and cannot be determined from attachments and/or schedules:
    • Illegible;

    • Missing;

    • Other than 9 digits;

    • All zeroes; or,

    • All nines

    Unnumbered 1. Research IDRS.
    2. If not found, route to Entity.
    Numbered 1. Circle out all illegible SSNs, zeroes or nines.
    2. Edit Action Code 320.
    3. Attach Form 4227 and leave in the batch.
    "PENDING" , "APPLIED FOR" , etc., is indicated in the SSN area Unnumbered 1. Research IDRS.
    2. If not found, route to Entity.
    Numbered 1. Edit Action Code 320.
    2. Attach Form 4227 and leave in the batch.

    Note:

    Action Code 320 is valid on Forms 706, 706-NA, 706-GS(D), 706-GS(T), and 709. All other returns (Forms 706-A, 706-D, 706-CE, 706-GS(D-1), and 706-QDT) are processed through a manual correction system and CCC "U" should be used on these returns.

3.11.106.9.2  (01-01-2014)
Entity Perfection - Name Control

  1. The name control consists of 4 characters or less:

    1. Valid characters are alpha, numeric, ampersand (&), hyphen (-) and blank. However, blanks are only valid in the last 3 positions.

    2. Disregard the word "THE" in the name control only when followed by more than one word.

  2. See Document 7071A, BMF Name Control Job Aid, to determine the name control.

  3. Edit the name control as follows:

    If And Then
    The entity is not an IRS label   Underline the name control.
    Unable to determine the name control Unnumbered 1. Research IDRS.
    2. If found, edit to the proper location.
    3. If not found, route to Entity Control following local procedures.
    Numbered 1. Edit Action Code 352.
    2. Attach Form 4227, Intra-SC Reject or Routing Slip, and leave in the batch.

    Note:

    Action Code 352 is valid on Forms 706, 706-NA, 706-GS(D), 706-GS(T), and 709. All other returns (Forms 706-A, 706-D, 706-CE, 706-GS(D-1), and 706-QDT) are processed through a manual correction system and CCC "U" should be used on these returns.

3.11.106.9.3  (01-01-2014)
Entity Perfection - "In-Care-of" Name

  1. An "in-care-of" name can be identified by the words "in care of" or the symbols "c/o" or "%" (percent).

  2. Ensure that the "in-care-of" name is located above the street address:

    If Then
    The "in-care-of" name is located below the street address Arrow the "in-care-of" name above the street address.
    The "in-care-of" name is shown on an attachment Edit the in-care-of name above the street address beginning with the "%" or "c/o" in the first position.
    An "in-care-of" name is changed but there is no indication of an address change Edit the in-care-of name as shown above.

    Note:

    Always circle out the "in-care-of" symbol (% or c/o) if it is present with an address. Do not use the ampersand (&) and the percent sign (%) when editing address information.

3.11.106.9.4  (01-01-2014)
Entity Perfection - Domestic Address

  1. Perfection of the address is necessary when the mailing address (Street or PO Box) is not easily identified.

    Exception:

    Do not perfect the address on amended returns (CCC "G" ).

  2. The procedures for perfection of addresses indicating an address change are as follows:

    If And Then
    The address contains information other than a street address or PO Box   No perfection is necessary. ISRP will enter the complete address.
    There is an indication on an attachment that the address has been changed   Edit the new address in the Entity section of the return.
    Form 8822, Change of Address, is attached Information is the same Take no action.
    Information is different Detach Form 8822 and route to Entity Control following local procedures.
    Both a PO Box and a street address are shown   1. Notate "TC 014" in the upper left margin. See Figure 3.11.106-6.
    2. Input TC 014.
    Two street addresses are shown   1. For Form 706 and Form 709 series returns, underline the first street address.
    2. Notate "TC014" in the upper left margin.
    3. Input TC 014.
    Two PO Boxes are shown   1. For Form 706 and Form 709 series returns, underline the first PO Box.
    2. Notate "TC014" in the upper left margin.
    3. Input TC 014.
    One street address is shown The taxpayer changed the address to a PO Box 1. Notate "TC014" in the upper left margin.
    2. Input TC 014.
    The city and state are not shown on the return but are shown on an attachment   Edit the city and state in the Entity section of the return.
    The ZIP code is missing or illegible Is not available from the return or attachments See Exhibit 3.11.106-22 for determining ZIP code. See Figure 3.11.106-6.
    Only the first 3 digits of the ZIP code can be determined   Edit "01" for the fourth and fifth digits.
    It is necessary to edit the street address   See Exhibit 3.11.106-21 for current Address/Street Abbreviations.

    Note:

    Always circle out the "in-care-of" symbol ("c/o" or "%" ) if it is present with an address. Do not use the ampersand (&) and the percent symbol (%) when editing address information.

  3. The U.S. Postal Service established new address requirements for Army Post Office (APO), Domestic Post Office (DPO), and Fleet Post Office (FPO) addresses. If an address appears in the old format, such as APO New York, NY 091XX, convert to the new state code abbreviation (APO AE 091XX) based on the following ZIP codes:

    ZIP Code Address Abbreviation
    340XX APO/DPO/FPO AA
    090XX-098XX APO/DPO/FPO AE
    962XX-966XX APO/DPO/FPO AP

    Figure 3.11.106-6
    This image is too large to be displayed in the current screen. Please click the link to view the image.

    Entity Edit Marks

3.11.106.9.5  (01-01-2014)
Entity Perfection - Foreign (International) Address

  1. A foreign (international) address is any address that is not in the 50 states or the District of Columbia.

  2. Returns with APO, DPO, or FPO addresses are considered domestic addresses.

  3. Route returns with a foreign (international) address (Form 706 and Form 709 series returns) to Cincinnati Submission Processing Campus (CSPC) for processing. Prepare 86C letter to inform the taxpayer that the return has been sent to CSPC.

    Note:

    The legal residence (domicile) of the decedent on Form 706 (Box 3a) or donor on Form 709 (Box 5) determines whether the return is a domestic or foreign (international) address return.

  4. Returns with addresses in the following U.S. Possessions are considered to be a foreign (international) address for processing purposes but are edited in the same way as domestic addresses.

    1. A two character alpha code must be edited for the possession name:

      U.S. Possession Abbreviation
      American Samoa AS
      Federated States of Micronesia FM
      Guam GU
      Marshall Islands MH
      Northern Mariana Islands MP
      Palau PW
      Puerto Rico PR
      Virgin Islands (U.S.) VI

    2. A ZIP code must be present. Edit the appropriate ZIP code if one is not provided. See Exhibit 3.11.106-23.

  5. All other foreign (international) addresses are edited the same as a domestic address with the following exceptions:

    1. The foreign country must be the last entry in the address.

    2. Circle out the foreign country and edit the country code preceded by a "/" and followed by "/$" as the last entry in the address. See Exhibit 3.11.106-24 for official foreign country codes.

      Note:

      Submission Processing BMF Foreign Address Job Aid (Number 2324-002) provides examples for editing foreign (international) addresses.

    3. If the foreign (international) address is from Australia, Brazil, Cuba, Italy, Mexico or The Netherlands, check if the address contains a province, state or territory name.

      If Then
      A province, state or territory name is present 1. Circle out province, state or territory name.
      2. Enter appropriate abbreviation. See Exhibit 3.11.106-25.
      A province, state or territory name is not present Continue editing the return.
      Province, state or territory is shown in abbreviated format Continue editing the return.

    4. A ZIP code is not required on a foreign (international) address. Foreign (International) addresses use a postal code that is entered before the city or foreign country and is part of the address.

3.11.106.9.6  (01-01-2014)
♦Foreign Address - Canada Only♦

  1. In an effort to assist Compliance with workload assignment, returns filed with an address in Canada will be edited using a unique country code based on the province/territory.

    If Then
    The foreign address contains a Canadian province/territory name or abbreviation 1. See table below to ensure the correct Canadian province abbreviation is present or edited to the return.
    2. Edit the appropriate country code based on the province preceded by a "/" and followed by a "/$" as the last entry in the address.
    The foreign address does not contain a Canadian province/territory name or abbreviation 1. Circle the country name.
    2. Edit the country code "/CA/$" as the last entry in the address.

    Canadian Province/Territory Province/Territory Abbreviation Country Code
    Alberta AB XA
    British Columbia BC XB
    Manitoba MB XM
    New Brunswick NB XN
    Newfoundland and Labrador NL XL
    Northwest Territories NT XT
    Nova Scotia NS XS
    Nunavut NU XV
    Ontario ON XO
    Prince Edward Island PE XP
    Quebec QC XQ
    Saskatchewan SK XW
    Yukon YT XY

3.11.106.10  (01-01-2014)
Processing Form 706, United States Estate (and Generation - Skipping Transfer) Tax Return

  1. The following information pertains to processing Form 706.

    Note:

    Form 706, Page 1, Parts 1 and 2, Page 2, Part 4, Page 3, Part 5, and new Part 6 have changed for tax year 2012 (PY2013) per Work Request Notification (WRN) received 6/29/2012. Many new lines have been added as well as new Part 6 which contains all of the Portability information. All of these new lines have been requested to be transcribed by E&G Policy, Chief Counsel and Treasury. Because of this transcription request, tax examiners (TEs) will now be responsible for making sure pages 1 through 4 are identified to facilitate transcription entry. If the return is not in sequential order (pages 1, 2, 3, 4), please identify pages 2, 3, and 4 by stapling a Post-It (sticky) with the page number on it within the return. We are using this method so large returns with several pages (perhaps a will or trust) between page 2, 3, and 4 can be identified quickly by ISRP. Stapling the Post-It (sticky) to the respective page will relieve the burden of having to disassemble the returns.

  2. In the past, Form 706 was only coded and edited on Page 1 of the return. Beginning in tax year 2013 (PY2014), Page 4, Part 6, Section C of the return will also need to be coded and edited. Changes were made to the DSUE calculation in a circulation of Form 706 received on September 23, 2013. As a result of the increase in the tax rates under ATRA, dividing the total gift tax paid or payable by 40% caused an error in the DSUE calculation (due to the increase in the tax rate). Additional changes were also incorporated into the instructions, specifically the Line 7 worksheet which is submitted with the Form 706 (the worksheet is NOT edited or transcribed). Line 2 was changed to "Reserved" , so Code and Edit should enter a zero on Line 2 of Form 706, Page 4, Part 6, Section C. Due to budget constraints, programming was not able to be completed so this is the work around. ISRP is going to be instructed to field release through the line (so "0" will populate on the ERS screens. ERS is instructed to make sure the line shows zero.

3.11.106.10.1  (01-01-2014)
Entity - Form 706

  1. The Entity portion of the Form 706 includes the following:

    • Decedent's Name

    • Decedent's Social Security Number (SSN)

    • Executor's address

3.11.106.10.1.1  (01-01-2014)
Decedent's Name

  1. The name control consists of the first 4 alpha characters of the Decedent's last name.

    1. Blanks may be present only in the last 2 positions of the name control.

    2. Ampersand (&), and hyphens (-) are the only valid non-alphabetic characters in a name control.

    3. Underline the first 4 characters of the Decedent's last name. (See Figure 3.11.106-6.)

    4. See Document 7071-A, BMF Name Control Job Aid.

    5. If name control cannot be determined, research IDRS. If no data found, use Action Code 320, use Form 4227, Intra-SC Reject or Routing Slip, and route to Entity.

3.11.106.10.1.2  (01-01-2014)
Decedent's Social Security Number (SSN)

  1. Nine numeric characters of the SSN must be present for all estate and gift tax returns; all nines (999999999) and zeros (000000000) will be invalid.

    If Then
    Return is unnumbered and SSN is different from death certificate Research IDRS for correct SSN.
    Return is numbered and SSN is different from death certificate Edit Action Code 320 and route to Entity for determination.
    Return is unnumbered and other than 9 digits, multiple SSNs, missing SSN or in EIN format Research IDRS for correct SSN.
    Return is numbered and other than 9 digits, multiple SSNs, missing SSN or in EIN format Edit Action Code 320 and route to Entity for determination.
    Return is unnumbered and no SSN is found, or the correct SSN cannot be determined Withdraw the return, use Form 4227, Intra-SC Reject or Routing Slip, and forward to Entity Control.
    SSN is on return when return is sent back from Entity Control Continue processing the return.

3.11.106.10.1.3  (01-01-2014)
Executor's Name

  1. When there are 2 or more executors' names listed on the return, underline the first name and circle out the others.

  2. Edit the executors name from attachments if not present in Box 6a.

3.11.106.10.1.4  (01-01-2014)
Executor's Address

  1. The Executor's address is found on Page 1, Box 6b, of Form 706; also check Page 2, Part 4.

    Note:

    If more than one executor and more than one executor address is listed on the return, underline the address that belongs to the first executor and circle out the others.

  2. See IRM 3.11.106.9.4, Entity Perfection-Domestic Address, for instructions to perfect domestic addresses.

  3. See IRM 3.11.106.9.5, Entity Perfection-Foreign (International) Address, for instructions to perfect foreign (international) addresses.

    Note:

    Always circle out the "in care of" symbol ("c/o" or "%" ) if it is present with an address. Do not use the ampersand (&) and the percent symbol (%) when editing address information.

3.11.106.10.1.4.1  (01-01-2014)
Decedent's Residence (Domicile)

  1. The decedents residence (domicile) at time of death is found on Page 1, Part 1, Box 3a. See IRM 3.11.106.10.6.8, for further instruction.

    Note:

    The legal residence (domicile) of the decedent in Box 3a determines whether the return is a domestic or foreign (international) address return.

  2. CSPC will process all domestic domicile address returns and all foreign (international) address returns (any address that is not in 1 of the 50 states or the District of Columbia).

  3. All U.S. Possessions are considered foreign:

    • American Samoa (AS)

    • Federated States of Micronesia (FM)

    • Guam (GU)

    • Northern Mariana Islands (MH)

    • Marshall Islands (MH)

    • Palau (PW)

    • Puerto Rico (PR)

    • Virgin Islands (U.S.) - (VI)

  4. APO/DPO/FPO addresses are not considered to be foreign (international) addresses.

    1. The Postal Service established new address requirements for APO/DPO/FPO addresses.

    2. If the old address appears (i.e., APO New York, NY 091XX) it must be converted to the new state code abbreviation based on the ZIP code (i.e., the previous example would be converted to APO AE 091XX).

      ZIP Code Address Abbreviation
      340XX APO/DPO/FPO AA
      090XX-098XX APO/DPO/FPO AE
      962XX-966XX APO/DPO/FPO AP

3.11.106.10.2  (01-01-2014)
Computer Condition Codes (CCCs) - Form 706

  1. CCCs B, D, G, L, O, R, W, Y, X, 3 and 7 are valid for Form 706.

  2. See IRM 3.11.106.5, Computer Condition Codes, for specific definitions.

3.11.106.10.3  (01-01-2014)
Filing Requirements - Form 706

  1. Form 706 tax returns are filed at CSPC.

  2. Form 706 must be filed for estates that have a Total Gross Estate of $5,250,000 and over for individuals who died in 2013; $5,120,000 and over for individuals who died in 2012; and $5,000,000 for individuals who died between January 1, 2010, and December 31, 2011.

3.11.106.10.3.1  (01-01-2014)
Due Date - Form 706

  1. The following information pertains to the due date of Form 706 returns:

    If Then
    Decedents died after December 31, 1970

    Caution:

    See Exception in next row for dates of death between January 1, 2010, and December 17, 2010 (inclusively).

    Form 706 is due the day of the ninth calendar month after the decedents death.

    Exception:

    If the date of death is between January 1, 2010, and December 17, 2010 (inclusively)

    The return due date is September 19, 2011, as mandated in the Extender's legislation (PL 111-312).

    Exception:

    If there is no numerically corresponding day in such ninth month

    The last day of the ninth month is the due date.
    For example, if the decedent died on May 31 of the current year, the due date is February 28 of the following year.

    Exception:

    If February 28 falls on a Saturday or Sunday the due date would be the following Monday.



    (See the due date table below.)

    Exception:

    Executors of Estates of decedents dying after October 22, 1986

    They must report all direct skips occurring at death on November 1987 or subsequent revision of Form 706.

  2. An application for extension of time for filing (Form 4768) may be granted. An approved Form 4768 is a six month extension making the extended due date 15 months from the date of death.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 Decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the Executor of a 2010 Estate who files a Form 4768 by the due date for filing Form 706 or Form 706-NA both an automatic six month extension of time to file Form 706 or Form 706-NA pursuant to Section 6081, and a six month extension of time to pay the estate tax. The Executor of a 2010 Estate is not required to substantiate on the Form 4768 the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the Executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768), justification needs to be provided.

  3. The following table lists the due dates of Form 706 returns:

    Exception:

    Other than 2010 revision forms.

    Month of Death Month Due
    January October
    February November
    March December
    April January
    May February
    June March
    July April
    August May
    September June
    October July
    November August
    December September

  4. The following table provides examples of due dates:

    If Then
    DOD is 01-01-10 thru 12-16-10 Due date is 09-19-2011
    (per Extender's Legislation the date should be 09-17-2011, but that is a Saturday)
    DOD is 12-17-10 thru 12-31-10 Due date is 09-30-11
    DOD is 05-31-13 Due date is 02-28-14
    DOD is 07-31-13 Due date is 04-30-14
    DOD is 10-31-13 Due date is 07-31-14

3.11.106.10.3.2  (01-01-2014)
Extension - Form 706 with Form 709 Attachment

  1. If a Form 706 is received with an original Form 709 attached to it (for the same period in which the decedent died) with an approved extension of time to file, then:

    1. Pull the Form 709.

    2. Enter the received date, and note on the return, "Extension Form 706 granted to MMDDYY. Do not assess penalties" .

    3. Edit CCC "R" on the return so that a penalty will not be assessed on the Form 709 if the Form 706 posts after the Form 709. (See IRM 3.11.106.15, Processing Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return.)

3.11.106.10.3.3  (01-01-2014)
Form 706 Conversion

  1. All Form 706 returns must be converted to the current year tax form revision. See Exhibit 3.11.106-9 and Exhibit 3.11.106-10.


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