3.11.213  Form 1066, U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return

Manual Transmittal

October 24, 2014

Purpose

(1) This transmits revised IRM 3.11.213, Returns and Documents Analysis, Form 1066, Real Estate Mortgage Investment Conduit Income Tax Return.

Material Changes

(1) Editorial changes have been made throughout the IRM. All reserved subsections have been removed and numbering of the subsections occurred. All cross references have been verified.

(2) IRM 3.11.213.1.3 Added new subsection on BMF Identity Theft.

(3) IRM 3.11.213.2.1(4) Added to the Types of Edit Marks table under Edit Marks Made to Other IRS Functions. Entity was added to the other areas listed and added the statement, "Do not edit (or write) over another area's edit marks"

(4) IRM 3.11.213.3.4.1(4) First Then box in table added instructions to send unprocessable returns back to AM as indicated.

(5) IRM 3.11.213.10(2) Revised the CCC "G" information in the last row of the "Then" column. Placed an Exception immediately below the table.

(6) IRM 3.11.213.12(2) Statute Returns - Added Secured by Examination/Collections, TE/GE and TE/GE Employee Plan (EP) exam to the list of exceptions for routing to the Statute Control Unit. Also removed the bullet that mentions Exam and processing as original.

(7) IRM 3.11.213(3) added instructions to send Form 12412 to your lead to return back to TAS if within 90 days of expiration and has not been seen by Statute.

(8) IPU 14U0673 dated 04/10/2014 IRM 3.11.213.12(6) Added to If/And/Then table consistency change to And boxes.

(9) Exhibit 3.12.213-2 Added additional information in the description boxes for Other arguments chart. Corrected citation for IRC as instructed for IRC §861.

Effect on Other Documents

IRM 3.11.213 dated November 8, 2013 (effective date January 1, 2014) is superseded. This IRM also incorporates the following IRM Procedural Updates (IPUs):
IPU 14U0673 (dated 04/10/2014)

Audience

Wage and Investment (W &I), Submission Processing

Effective Date

(01-01-2015)

Paul J. Mamo
Director, Submission Processing
Customer Account Services
Wage and Investment Division

3.11.213.1  (01-01-2015)
General Information

  1. This section provides instructions for general processing actions required to be taken on returns or other input documents as opposed to the specific line item instructions required in the subsequent section. The document to be processed by this Section is the Form 1066, U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return. Forms 1066 are filed at Ogden Submission Processing Campus.

  2. Form 1066 is used to report the income, deductions, gains and losses from the operation of a real estate mortgage investment conduit (REMIC). See Exhibit 3.11.213-1 for transcription information. In addition, the form is used to report and pay the taxes on net income from prohibited transactions, foreclosure property, and contributions after the startup day. A REMIC must file Form 1066 by the 15th day of the 4th month following the close of the tax year. The MFT is 07, tax class 3 and document code 60. The program code is 12201.

  3. Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns, may be filed if additional time to file is needed.

  4. The REMIC uses Schedule Q to notify Residual Interest Holders (RIH) of their quarterly share of the taxable income or net loss. A copy is sent to each RIH by the last day of the month following the end of the calendar quarter. The original Schedule Q (Copy A) for all quarters is filed with Form 1066.

  5. Form 1066 can be amended. It will be "G" coded and sent to Accounts Management (AM) after processing.

3.11.213.1.1  (01-01-2015)
Internal Revenue Service (IRS) Employee Contacts - RRA98, Section 3705(a)

  1. The Restructuring and Reform Act of 1998 (RRA98), Section 3705(a), provides identification requirements for all IRS employees working tax-related matters. IRS employees are required to give their name and unique identification number during taxpayer telephone, face-to-face, and written contact. In addition, a telephone number is required on all taxpayer correspondence. This will provide taxpayers with enough information to identify an IRS employee who has previously assisted with tax related matters.

  2. All IRS employees who communicate by telephone, correspondence or face-to-face, with taxpayers or their personal representatives, on tax-related matters are required to provide (at minimum) the following information:

    1. Telephone Contact - Their title (e.g., Mr., Mrs., Ms., Miss), last name and bade identification (ID Card) number.

    2. Face-to-Face Contact - Their title (e.g., Mr., Mrs., Ms., Miss), provided as appropriate during the conversation, their last name and badge identification (ID Card) number.

    3. Correspondence - All correspondence must include a telephone number where the taxpayer's question can be answered. In addition, manually generated and handwritten correspondence must have their title (e.g., Mr., Mrs., Ms., Miss), last name, and IDRS (Integrated Data Retrieval System) number, letter system number, or their badge identification (ID Card) number.

    4. The IDRS number and numbers for some other letter systems are automatically generated. If it is not generated, or a handwritten note is prepared, the badge identification (ID Card) number must be used. Toll-free employees may also provide their location for identification purposes. Faxes to taxpayers on tax-related matters are considered manually-generated correspondence and must include the required information.

    5. Correspondence, whether sent directly to the taxpayer or to the taxpayer's personal representative, must contain the required information.

    6. When a taxpayer requests to speak with a specific employee who previously handled their inquiry or request, or complains about the level of service previously provided, every attempt should be made to resolve the taxpayer's inquiry. If the issue cannot be resolved, the employee should refer the inquiry using established procedures to his or her manager.

    7. Correspondex letters will require a specific employee name and telephone number only if the employee initiating the correspondence is in the best position to respond to any questions that the taxpayer may have about the correspondence, or the employee is asking the taxpayer for additional case-related information.

    8. Otherwise, if the taxpayer does not need to contact a specific employee, the correspondence needs only an IRS telephone number and standard signature.

    9. Secretaries, receptionists, or other people who answer the telephone in functional offices need to identify themselves and should provide their badge identification (ID Card) number only if they are answering telephones which are routinely used to provide tax or account information.

    10. It is not necessary to repeat the badge identification (ID Card) number on a subsequent contact, when the nature of an employee's work involves multiple contacts with the same taxpayer, and the employee has given the taxpayer (either telephone or in-person) his or her badge identification (ID Card) number on the first contact.

3.11.213.1.2  (01-01-2015)
♦Taxpayer Advocate Service (TAS)♦

  1. Refer taxpayers to the Taxpayer Advocate Service (TAS) (see IRM 13, Taxpayer Advocate Service) when the contact meets TAS criteria (see IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria) or Form 911 is attached, and you can't resolve the taxpayer's issue the same day. The definition of "same day" is within 24 hours. "Same day" cases include cases you can completely resolve in 24 hours, as well as cases in which you have taken steps within 24 hours to begin resolving the taxpayer's issue. Do not refer these cases to TAS unless they meet TAS criteria and the taxpayer asks to be transferred to TAS. Refer to IRM 13.1.7.4, Same-Day Resolution by Operations. When referring cases to TAS, use Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), and forward to TAS in accordance with your local procedures.

3.11.213.1.2.1  (01-01-2015)
♦TAS Service Level Agreements (SLAs)♦

  1. The National Taxpayer Advocate has reached agreements with the Commissioners of the Wage and Investment (W&I) Division, Small Business and Self-Employed (SB/SE) Division, Tax Exempt and Government Entities (TE/GE), Criminal Investigation (CI), Appeals, and Large Business and International (LBandI), that outline the procedures and responsibilities for the processing of Taxpayer Advocate Service (TAS) casework when either the statutory or delegated authority to complete case transactions rests outside of TAS. These agreements are known as Service Level Agreements (SLAs).

  2. The SLAs are located at http://tas.web.irs.gov/policy/sla/default.aspx.

3.11.213.1.3  (01-01-2015)
♦BMF Identification (ID) Theft♦

  1. BMF Identity Theft is increasing. If a tax examiner in Submission Processing (SP) Code and Edit (C&E) finds a case with attachments or correspondence indicating the taxpayer is a victim of ID Theft, provide the whole case to your senior/lead. Your senior/lead will expedite the case to the P&A staff for referral to one of the SP BMF ID Theft liaisons. The taxpayer must clearly state that they are a victim of "ID Theft" ; do not send cases that are subject to "Funny Box" or "Fraud" review.

3.11.213.1.4  (01-01-2015)
Incomplete Returns

  1. The following are procedures for ensuring the return is complete:

    If... Then...
    Incomplete return When the return serves only as a transmittal for statements, schedules and other attachments, or is otherwise incomplete, analyze the supporting documents and supply the missing entries on the form itself.
    Data on the substitute schedules is in suitable format for transcription It is not necessary to transfer the data to an IRS form.
  2. A primary consideration is the proper presentation of income and deduction items for subsequent transcription and computer processing. Document Perfection is responsible for arranging the return in the following order:

    • Page 1

    • Page 2

    • Page 3

  3. Enter only transcription items. Leave lines blank if the entry would be a zero amount. See Figure 3.11.213-1

    Figure 3.11.213-1

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3.11.213.1.5  (01-01-2015)
Prior Year Conversion

  1. If the line items on a prior year form do not agree with line items on the current form, transfer the data to the appropriate line items on a current form. Fold back the entity area of the current form and attach below the entity area of the prior year form, or renumber the prior year to comply with current year line items.

3.11.213.1.6  (01-01-2015)
♦BMF Consistency♦

  1. The purpose of this initiative is to achieve consistency in the Business Master File (BMF) Code and Edit (C&E) processing IRMs.

  2. Topics for the BMF Consistency have been identified and developed as a coordinated effort between Cincinnati, Ogden and Paper Processing Branch BMF C&E/ERS.

  3. BMF Consistency subsections are identified by a "♦" (diamond) before and after the title.

  4. Text in normal print is the common processes for BMF returns. The text in BOLD print is form specific and applies to this IRM only.

3.11.213.1.7  (01-01-2015)
♦Foreign Currency♦

  1. For returns completed in other than U.S. currency, process as filed. However, if corresponding for missing/incomplete item(s), include in the letter to resubmit in U.S. currency.

3.11.213.1.8  (01-01-2015)
♦Protective Claims♦

  1. Returns marked as "Protective Claim" , "Protective Refund" , "Protective Claim for Refund" , or similar statement will be removed from the batch and routed to Accounts Management. Notate Protective Claim in the remarks box of Form 4227.

    Exception:

    If the return is amended, do not remove from batch. Edit Computer Condition Code "G" and follow normal processing procedures.

3.11.213.1.9  (01-01-2015)
♦Criminal Investigation (CI) "Funny Box" ♦

  1. Criminal Investigation (CI) investigates potential criminal violations of the Internal Revenue Code (IRC) and related financial crimes. Criminal violations of the IRC are willful and deliberate attempts to evade or defeat the income tax. Flagrant criminal activity includes but is not limited to the failure to pay taxes due and/or taxes collected or withheld and claims of false refunds based on bogus return information.

  2. Pull any return identified as having CI criteria found in paragraph (3) below and place in "CI Funny Box" .

  3. CI "Funny Box" criteria:

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

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

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

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

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

3.11.213.1.10  (01-01-2015)
♦Examination (Exam) "Funny Box" ♦

  1. The primary objective in identifying tax returns for Examination (Exam) is to promote the highest degree of voluntary compliance. Examination will provide support and assist Submission Processing (SP) with any questionable return identified during processing. Exam has a vast multitude of programs and tolerance criteria already identified in various IRM sections. Exam does not restrict SP with the flexibility to refer questionable returns other than what is currently identified in various IRMs.

3.11.213.2  (01-01-2015)
General Editing Guidelines

  1. The Document Perfection tax examiner will identify a return that is unprocessable and requires correspondence, research or other action in order to make the return processable.

  2. The tax examiner will determine the kind of action required and assign an Action Code to the return.

3.11.213.2.1  (01-01-2015)
♦Edit Marks♦

  1. Edit marks are edited on the return for transcription to the Automatic Data Processing (ADP) System through the Integrated Submission and Remittance Processing (ISRP) System. 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" or "/" 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 that is not being transcribed.
    "//$" The "//$" is used in the entity area to identify the beginning and ending of a foreign country code. For example, "/EI/$" is edited for "Ireland" or "/GM/$" 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 an entry is to be transcribed (e.g., Name Control, Tax Period, etc.).
    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/Parentheses Indicates a negative numerical amount.

    Note:

    C&E 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 "-" sign. It will be necessary to bracket negative amounts when editing negative entries on transcription lines (e.g., computing and entering a line entry, entering a missing line entry, etc.).

    Vertical Line or Decimal Point Indicates the separation of dollars and cents.
    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 other areas such as Collections, Entity or Accounts Management, are not to be re-edited except to place the marks in the correct area. Do not edit (or write) over another area's edit marks.
    Rocker Indicates the amount paid when drawn under a remittance amount.

3.11.213.2.2  (01-01-2015)
♦Action Codes♦

  1. Action Codes are used to indicate whether correspondence, research, or some other action is needed. The Action Code will set the suspense period to be assigned to the return and place the return in the workable or unworkable suspense inventory.

  2. When necessary, a three-digit Action Code will be assigned by the tax examiner.

  3. Edit the Action Code in the bottom left margin of Form 1066. See Figure 3.11.213-2.

    Figure 3.11.213-2

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  4. Assign Action Codes in the following priority:

    1. Action Code 310 (Statute Control)

    2. Action Code 320 (Entity Control)

    3. Action Code 4XX

    4. Action Code 6XX

    5. Action Code 3XX

    6. Action Code 2XX (Correspondence)

      Exception:

      Use Action Code 211, 215, 225 or 226 before Action Code 341 to ensure the return is complete before a manual refund is issued.

  5. Attach Form 4227 when more than one Action Code is needed. Edit the second Action Code with the shortest suspense period on the form and edit the second Action Code on Form 4227.

  6. Edit the following Action Codes when a return cannot be perfected:

    Action Code Description
    211 (First Correspondence) or
    215 (International Correspondence)
    • Return is illegible, incomplete, or contradictory and therefore can not be processed

    • The taxpayer notates on the return or attachment that they are reporting tax for more than one Tax Period or for more than one type of tax

    225 (Missing Signature Correspondence)
    • Unsigned return (only issue for correspondence)

    226 (Missing Signature International Correspondence)
    • Unsigned foreign return (only issue for correspondence)

    480 (Early Filed Suspense)
    • Early filed return

    610 (Renumbered Non-remittance) or
    611 (Renumbered with remittance)
    • A return is mis-blocked (e.g., Form 1065 found in a 1066 batch of work)

    640 (Void)
    • To delete the assigned Document Locator Number (DLN) on the return (e.g., Re-entry Returns)

    650 (International)
    • An International return that must be forwarded to Ogden Submission Processing Center (OSPC)

      Note:

      An Army Post Office (APO) / Diplomatic Post Office (DPO) / Fleet Post Office (FPO) address is not considered foreign.

  7. Continue perfecting the return after editing the Action Codes.

  8. Valid Action Codes are listed below:

    Action Code Description Workday Suspense Period
    211 First Taxpayer Correspondence 40
    212 Second Correspondence 25
    215 International Correspondence 45
    225 Taxpayer Correspondence (Signature Only) 40
    226 International Correspondence (Signature Only) 40
    310 Statute Control 10
    320 Entity Control 10
    331 Frivolous Review 3
    341 Manual Refund 10
    342 Credit Verification 10
    343 Black Liquor 10
    352 Name Research 3
    360 Other-in-House Research 10
    420 2006 tax return with Form 8913 credit 5
    440 Manager's Suspense 15
    480 Early Filed Suspense 150
    610 Renumber - Non-remit 0
    611 Renumber - Remit 0
    640 Void 0
    650 International 0

3.11.213.2.3  (01-01-2015)
♦Refund Returns - 45-Day Jeopardy and Million Dollar Refunds♦

  1. Document Perfection is responsible for identifying refunds and for initiating requests for manual refunds.

    Note:

    Expeditious processing of refund returns is critical if the 45-day period is about to expire.

    If... Then...
    A refund return is batched in a non-refund batch, 1. Completely edit the return.
    2. Pull the return from the non-refund batch using local procedures.

    Note:

    Follow the instructions below when the processing date is more than 20 days after the Received Date or the return due date OR the refund is $1,000,000 or more.

    The processing date is more than 20 days after the Received Date or the return due date (whichever is later) and the refund amount is $5,000 or more,

    Note:

    Refund in this instruction means only the amount requested to be refunded to the taxpayer, not overpayments transferred to other periods.

    1. Edit Action Code 341.
    2. Give the return to the manager.
    The refund is $1,000,000 or more,

    Note:

    Refund in this instruction means only the amount requested to be refunded to the taxpayer, not overpayments transferred to other periods.

    1. Do not leave the return in the block.
    2. Edit Action Code 341 for numbered and unnumbered returns.
    3. Give the return to the manager.
    The W&I Submission Processing TAS Liaison walks a return through Code and Edit, In addition to normal editing, edit the following:
    1. Computer Condition Code (CCC) "O" , to freeze the refund.

    2. CCC "Y" , to send the return to ERS.

3.11.213.3  (01-01-2015)
Unprocessable Conditions

  1. The Document Perfection tax examiner will have the first opportunity to identify a return having a problem which requires correspondence, research or other action in order to make the return processable. An Action Code is edited to identify these unprocessable returns. See IRM 3.11.213.2.2, Action Codes.

  2. The tax examiner will determine the kind of action required and assign an Action Code to the return which will force it to the Error Resolution System (ERS) (on-line correction system). The code will indicate whether correspondence, research or some other action is needed.

  3. The following information pertains to multiple return information on one return:

    If... Then...
    Liability for two or more Form 1066 returns was reported on one unnumbered return and the information necessary for the preparation of the individual return is present, 1. Adjust the line entries on the period return to reflect the liability for the earliest period.
    2. Prepare "Dummy" returns as necessary for additional periods.
    2. Retain all the unnumbered returns in batch.
    The original return is numbered, 1. Edit Action Code 360 and leave in the block.
    2. Attach Form 4227, Intra-SC Reject or Routing Slip, for Reject Correction. Notate "Multiple Period" .
    If there is not enough information to prepare additional period returns, Correspond.

3.11.213.3.1  (01-01-2015)
Suppression of Delinquency Check

  1. The following information pertains to suppression of the delinquency check.

    If... Then...
    An unnumbered, unprocessable return is withdrawn from processing, Input Transaction Code (TC) 599, Closing Code "17" to suppress the normal delinquency check and edit in the top of the left margin. See Figure 3.11.213-3

    Figure 3.11.213-3

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3.11.213.3.1.1  (01-01-2015)
TC 599, Closing Code 17

  1. The following information pertains to TC 599:

    If... Then...
    Inputting TC 599 via IDRS, The following information is necessary:
    1. Employer Identification Number (EIN)
    2. Name Control
    3. MFT (07 for Form 1066)
    4. Tax Period
    The above information is present, Flag the return for input of TC 599, Closing Code "17" via IDRS.
    Using TC 599, Closing Code "17" , Use only with management approval per instructions in IRM 3.30.123, Processing Timeliness: Cycles, Criteria and Critical Dates.

3.11.213.3.2  (01-01-2015)
♦Correspondence♦

  1. There are two types of correspondence that Code and Edit may encounter:

    1. Correspondence received from taxpayers, and

    2. Issuing correspondence to taxpayers.

3.11.213.3.3  (01-01-2015)
♦Definition of Correspondence from Taxpayers♦

  1. Correspondence is all written communications from a taxpayer or his/her representative, excluding tax returns, whether solicited or unsolicited. This includes:

    1. Written communications in response to IRS requests for information or data.

    2. Written communications, including annotated notice responses, that provide additional information or dispute a notice.

    3. A telephone call that results in a written referral or research (Form e-4442, Inquiry Referral).

  2. The key to identifying taxpayer correspondence is to ask the following questions:

    1. Is taxpayer waiting for a response from us?

    2. Is taxpayer waiting for an action to be taken by us?

    3. Is taxpayer asking a question?

    Note:

    A Post-It-Note, Sticky Note, or some other type of note stuck on the return by another function does not constitute correspondence from the taxpayer. For instance the note may state something like the following: "Taxpayer (TP) requests penalties be waived" .

3.11.213.3.4  (01-01-2015)
♦Issuing Correspondence♦

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

    Exception:

    Do not correspond on returns prepared by Collections, IRC §6020(b) or by Examination, "Substitute for Return" (SFR).

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

    If... And... Then...
    Correspondence is needed, Requires a response, 1. Complete an approved Correspondence Action Sheet indicating the letter number (86C, 854C etc.), 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 the Correspondence Action Sheet to the front of the return below the Entity area.
    3. Edit Action Code "211" (First Correspondence) or "215" (International Correspondence) on the return.
    4. Finish editing the return and leave in the batch.
    Correspondence is needed, Does not require a response, 1. Complete an approved Correspondence Action Sheet indicating the letter number (86C, 854C, etc.), 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 first page of return and attach the Correspondence Action Sheet below the Entity area on the front of the return. Be sure the name and address shows clearly above the Correspondence Action Sheet.
    3. Forward the copy to the Correspondence area.
    4. Edit an Action Trail (e.g., "854C sent" ) in the lower left corner going vertically up the side of the return.
    5. Finish editing the return and leave in the 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 processing. The Tax Examiner should go to his or her Lead or Manager for copies of these letters to facilitate processing.

3.11.213.3.4.1  (01-01-2015)
♦Correspondence Imaging System (CIS) Returns♦

  1. Correspondence Imaging System (CIS) is an inventory system for scanning all Accounts Management (AM) receipts into digital images and working the cases from those images.

  2. "CIS" returns are identified with "CIS Image-Do not correspond for Signature" stamped below the signature line or "CIS" annotated on the front of the return.

  3. Verify all edit marks and ensure placement is correct on a "CIS" return.

    If... Then...
    The edit marks are black, Underline the edit mark if correct or circle if incorrect.
    The edit marks are red or green, Circle if incorrect.
    The edit marks are missing or incorrect, Perfect as necessary.
  4. Follow the instructions below for processing "CIS" returns.

    If... And... Then...
    The "CIS" return has a Form 13596 attached,

    Note:

    If there is an indication on the return that correspondence has been sent (e.g., CCC "3" is edited on the return), do not route the return to Accounts Management. Continue processing the return.

    The return is not complete (e.g., missing signature, schedules or forms), Remove the return from the batch and route to Accounts Management.

    Caution:

    If the return comes back from AM with the information still incomplete, send the return to AM again to secure the missing information. Indicate "Additional information needed to process incomplete CIS return" , or similar language on Form 4227 (or other appropriate routing slip).

    Note:

    Do not correspond for missing information on "CIS" reprocessable/re-input returns.

    The "CIS" return does not have a Form 13596 attached, The return is not complete (e.g., missing signature, schedules or forms), Follow normal correspondence procedures.

3.11.213.3.4.2  (01-01-2015)
♦Use of Fax for Taxpayer Transmissions♦

  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 approved 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 21.1.3.2.3, Required Taxpayer Authentication and 21.1.3.2.4, Additional Taxpayer Authentication. 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.

3.11.213.4  (01-01-2015)
♦Routing Guide for Attachments♦

  1. All attachments to the return must be reviewed before the return can be considered processable.

    1. Attachments should only be detached when specifically instructed.

    2. Edit Action Trail(s) (e.g., "2848 DETACHED" ) in the lower left corner going vertically up the side of the return.

    Note:

    When a document is detached and routed for processing, edit the name, address and EIN if not present. Also, edit the return Received Date (e.g., "Rec'd MM/DD/YY" ) in the lower left margin of the detached document before forwarding.

    Caution:

    The Attachment Guide is included as an exhibit only for use in assisting in the identification of possible forms or conditions that require action or routing to other functions. The guide should not be used in place of the completed IRM section governing those conditions, since space limitations do not always allow for full instructions in the Attachment Guide.

  2. Follow the general guidelines below for each attachment:

    DOCUMENT DETACH ACTION
    CP 504/504B No
    1. Pull up CP 504 to the front.

    2. Route notice and return to Accounts Management.

    CP 259, 515-518 No Route notice and return to Collections.

    Exception:

    Do not route to Collections if "599" is notated.

    Includes tax liability for multiple Tax Periods or Types of Tax No
    • Numbered returns - route to Rejects

    • Unnumbered returns - prepare a dummy return if possible, otherwise correspond

    Other tax returns (original signature) Yes 1. Edit Received Date to the detached return.
    2. Route to appropriate function unless specifically directed otherwise.

    Exception:

    Returns attached to a consolidated return will NOT be detached.

    Petitions in opposition of tax law provisions Yes

    Note:

    No Action Trail needs to be edited when detaching petition.

    Route to:
    IRS ≡ ≡ ≡ ≡ ≡ ≡
    1111 Constitution Ave, NW
    Washington, DC 20224.
    State tax returns, original or copy with an original signature Yes Route to Receipt and Control.
    State tax returns, (Photocopy, facsimile or no signature) No Leave attached.
    Statement establishing Reasonable Cause for delinquent filing No 1. Issue Letter 1382C.
    2. Continue editing the return. See IRM 3.11.213.15.7
    Remittance found No Immediately hand-carry return and remittance to supervisor.
    Request for Acknowledgement No No action required.
    Request for information or inquiries Yes 1. Photocopy any data necessary to process the return.
    2. Attach the photocopy to the return.
    3. Route original attachment to the proper office for necessary action.
    Request for Installment Agreement Yes Ogden-route to Collections.
    Request for Adjustment to another document Yes Route to the appropriate function. Attachment must contain Name, Address, EIN, and Received Date. Edit if missing.
    Request for money transfer No/Yes NO - If the taxpayer notates transfer of money TO the return you are processing:
    1. Prepare Form 3465 and:
    a) Indicate in the "Routing" box "Rejects" .
    b) Notate "See attached money transfer request" in "Remarks" box.
    2. Edit Action Code 450 to route the request to Rejects.
    YES - If the taxpayer notates transfer of money FROM the return you are processing:
    1. Edit CCC "X" to freeze overpayment.
    2. Prepare Form 3465 and:
    a) Indicate in the "Routing" box "Adjustments" .
    b) Notate the requested action in the "Remarks" box.
    3. Attach Form 3465 to the request and route to Accounts Management.
    4. Continue editing the return.
    Request for Forms or Schedules No If requesting for current year forms:
    1. Prepare Form 4190.
    2. Forward to the National Distribution Center (NDC) for processing.
    If requesting for prior-year forms:
    1. Prepare Form 6112.
    2. Forward to the National Distribution Center (NDC) for processing.

    Note:

    Forms 4190 and 6112 are generally used for IMF requests. Therefore, enter all BMF requests for forms and/or schedules in the "WRITE-IN" portions of the forms.

    Request for Installment Agreement Yes Ogden-route to Collections.
    Cincinnati-route to R&C.
  3. Guidelines for attachments related to Form 1066:

    DOCUMENT DETACH ACTION
    Form 433-B, Collection Information Statement for Businesses Yes Ogden - route to Collections.
    Form 433-D, Installment Agreement Yes Ogden - route to Collections.
    Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation No Edit Audit Code "2" preceded by "8-" in the left margin of the "Deductions" Section.
    Form 1065X, Amended Return or Administrative Adjustment Request (AAR) No Route Form 1066 and Form 1065X to Accounts Management.
    Form 2848, Power of Attorney and Declaration of Representative Yes/No Yes - Route to the Centralized Authorization File (CAF) Function.
    No - If a "General Power of Attorney" , "Durable Power of Attorney" , or "Tax Information Authorization" is submitted on any document other than Form 2848 or Form 8821.
    Form 3520-A, Annual Information Return of Foreign Trust with a U. S. Owner Yes Forward to Ogden Submission Processing Campus (OSPC) via Form 4227.
    Form 3753, Manual Refund Posting Voucher No Edit Computer Condition Code "0" to the dotted portion of Section 1, Line 1.
    Form 4797, Sales of Business Property (Also Involuntary Conversions and Recapture Amounts) No No action required.
    Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations No Edit Audit Code "2" preceded by "8-" to the left margin of the "Deductions" Section.
    Form 5713, International Boycott Report Yes 1. Forward original to OSPC Statistics of Income (SOI), Mail Stop 6112.
    2. Leave copies attached and edit Audit Code "2" preceded by "8-" to the left margin of the "Deductions" Section if attached or there is a "yes" answer to the Foreign Trust Question "1" , Page 4, Additional Information. See IRM 3.11.213.21, Audit Codes.
    Form 6252, Installment Sale Income No Edit Installment Sale Indicator in the left margin of the "Deductions Section" preceded by "9-" .
    See IRM 3.11.213.22, Installment Sale Indicator.
    Form 7004, Application for Automatic Extension of Time to File Certain Business, Income Tax, Information, and Other Returns Yes/No YES - If Form 7004 is for other than the tax return or Tax Period being filed, route to Receipt & Control.
    NO - If Form 7004 is for the tax return it is attached to.
    Form 8082, Notice of Inconsistent Treatment or Administrative Adjustment Request (AAR) No Edit Audit Code "1" preceded by "8-" to the left margin of the "Deductions" Section.
    Form 8271, Investor Reporting of Tax Shelter Registration Number No No action required.
    Form 8275, Disclosure Statement No Edit Audit Code "1" preceded by "8-" to the left margin of the "Deductions" Section.
    Form 8275-R, Regulation Disclosure Statement No Edit Audit Code "1" preceded by "8-" to the left margin of the "Deductions" Section.
    Form 8821, Tax Information Authorization Yes/No Yes - Route to the Centralized Authorization File (CAF) Function.
    No - If a "General Power of Attorney" , "Durable Power of Attorney" , or "Tax Information Authorization" is submitted on any document other than Form 2848 or Form 8821.
    Form 8822, Change of Address; or Form 8822-B, Change of Address - Business Yes/No YES - If the information is different from the return, route to Entity Control.
    NO - If the information is the same as on the return.
    Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b) No Edit CCC "L" to the dotted portion of Section 1, Line 1.
    Form 9465, Installment Agreement Request Yes Ogden - route to Collections.
    SS-4, Application for Employer Identification Number Yes/No YES - If Entity Control has assigned an EIN to the Form SS-4, route to Entity Control.
    NO - If Entity Control has not assigned an EIN to the Form SS-4, route the Form 1066 and Form SS-4 to Entity Control for EIN assignment.

3.11.213.5  (01-01-2015)
♦Entity Perfection - General♦

  1. The Entity area of a tax return identifies the taxpayer on the Business Master File. The Entity area of the return contains the following:

    1. Employer Identification Number (EIN)

    2. Name

    3. "In-care-of" name

    4. Address

3.11.213.5.1  (01-01-2015)
♦Entity Perfection - Employer Identification Number (EIN)♦

  1. The EIN is a nine-digit number (XX-XXXXXXX) assigned to identify the taxpayer.

  2. Determine the EIN as follows: The EIN is located in the upper right of the form ("Employer Identification Number" box).

  3. Determine the EIN as follows:

    1. If... And... Then...
      EIN is missing, You can determine the correct EIN from the attachments and/or schedules, Edit the EIN to the proper location.
      The EIN is either a Practitioners Tax Identification Number (PTIN) or Individual Taxpayer Identification Number (ITIN), Unnumbered/Numbered Unnumbered:
      1. Remove return from batch.
      2. Forward to Entity Control following local procedures for EIN assignment.
      Numbered:
      1. Edit Action Code 320.
      2. Leave return in batch.
      Multiple EINs are present, Unnumbered/Numbered Unnumbered:
      1. Remove return from batch.
      2. Forward to Entity Control following local procedures for EIN assignment.
      Numbered:
      1. Edit Action Code 320.
      2. Leave return in batch.
      The EIN 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/Numbered 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. Circle all illegible EINs, zeroes, or nines.
      2. Edit Action Code 320.
      3. Leave return in batch.
      "Pending" , "applied for" , etc., is indicated in the EIN area, Unnumbered/Numbered 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 320.
      2. Leave return in batch.

3.11.213.5.2  (01-01-2015)
♦Entity Perfection - Name Control♦

  1. The Name Control consists of four characters or less.

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

    2. Disregard the word "The" in the Name Control only when more than one word follows. See Figure 3.11.213-4.

      Note:

      If an individual and a trade name are present and it can be determined that the trade name is for a corporation or a partnership, follow the Name Control procedures for corporations or partnerships. If other than a corporation or partnership, follow the Name Control procedures for individuals, regardless of which line the individual owner's name is listed.

  2. See Job Aid Document 7071-A, Name Control Job Aid - For Use Outside the Entity Area, to determine the Name Control.

    Figure 3.11.213-4
    This image is too large to be displayed in the current screen. Please click the link to view the image.
  3. If box "Name Change" on Form 1066 is checked, route the return to Entity Control following local procedures.

  4. Edit the Name Control as follows:

    1. If... And... Then...
      Able to determine the Name Control   Underline the Name Control.
      Unable to determine the Name Control, Unnumbered/Numbered 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 (Name Research).
      2. Leave return in batch.
      A return indicates the taxpayer has filed bankruptcy (e.g., shows "RECEIVER" , "TRUSTEE" , OR "DEBTOR IN POSSESSION" ) in the entity area or on an attachment,   Route to Entity Control following local procedures.

3.11.213.5.2.1  (01-01-2015)
♦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 the "in-care-of" name is located in the proper location.

    If… Then…
    The "in-care-of" name is located on the street address line preceding the street address, No editing is required.
    The "in-care-of" name is located above the first name line or below the street address, Arrow the "in-care-of" name so it appears below the first name line and 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.
    The street address for the "in-care-of" name is different from the street address of the REMIC, 1. Arrow the "in-care-of" street address below the "in-care-of" name or edit the "in-care-of" street address below the "in-care-of" name if located on an attachment.
    2. Circle the REMIC street address and input "TC 014" . (See IRM 3.11.213.5.3, Entity Perfection - Domestic Addresses.)

    Note:

    Always circle 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. A change in the "in-care-of" name can be determined by any of the following:

    • A check mark in the "Name change" box (Page 1, Item D, Box 2), or

    • A check mark in the "Address change" box (Page 1, Item D, Box 3), or

    • An indication that the "in-care-of" name is changed (e.g., the taxpayer crossed out the original "in-care-of" name and added the new name or has entered a new "in-care-of" name in brackets)

    If… Then…
    An "in-care-of" name is changed but there is no indication of an address change, 1. Edit the "in-care-of" name as shown above.
    2. Continue editing the return.
    An "in-care-of" name is present and the "Address change" box (Page 1, Item D, Box 3) is checked (or there is an indication of an address change), 1. Edit the "in-care-of" name as shown above.
    2. Correct the address (see IRM 3.11.213.5.3, Entity Perfection - Domestic Addresses).
    3. Continue editing the return.

3.11.213.5.3  (01-01-2015)
♦Entity Perfection - Domestic Addresses♦

  1. Perfection of the address is necessary when the mailing address (street or P.O. Box) is not easily identified.

    Exception:

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

  2. A business may have two addresses. One is the mailing address and the other is the location address or the physical location of the business.

  3. The procedures for perfection of addresses are as follows:

    If... And... Then...
    The address contains information other than a street address or P.O. Box,   No perfection is necessary. ISRP will enter the complete address.
    There is an indication on an attachment that the address has been changed or the "Address Change" box (Page 1, Item D, Box 3), is checked,   Edit the new address in the Entity section of the return. See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries for address abbreviations.
    Form 8822, Change of Address or Form 8822-B, Change of Address or Responsible Party - Business is attached, Mailing address information is the same and no location address is listed on Line 7, Take no action.
    Form 8822 or Form 8822-B is attached, Mailing address information is different and/or a location address is listed on Line 7, Detach Form 8822 or Form 8822-B and route to Entity Control following local procedures.
    Both a P.O. Box and a street address are shown,   1. Notate "TC 014" in the upper left margin.
    2. Input TC "014" .
    Two street addresses are shown,   1. Underline the second street address.
    2. Notate "TC 014" in the upper left margin.
    3. Input TC "014" .
    One street address is shown, The taxpayer changes the address to a P.O. Box, 1. Notate "TC 014" 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 Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, to determine the ZIP Code.

    Note:

    Edit the 3 digits followed by "01" of the first Zip Code listed for the applicable state (e.g., "99501" for Alaska).

    Only the first three digits of the ZIP Code can be determined,   Edit "01" for the fourth and fifth digits.
    The "Address Change" box (Page 1, Item D, Box 3), is checked, An "in care of name" is present, 1. Edit the "%" (percent sign) or "c/o" to the left of the "in care of" name (in the first position) followed by the appropriate name.
    2. Correct the address.
    The National Change of Address (NCOA) label is present,   Underline the Name Control.
    It is necessary to edit the street address,   See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for current Address/Street Abbreviations.

    Note:

    Always circle 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.

  4. The U.S. Postal Service established new address requirements for APO/DPO/FPO addresses. If the old address appears, convert it to the new State Code abbreviation based on the ZIP Code (e.g., APO New York, NY 091XX would be converted to APO AE 091XX). See Figure 3.11.213-5. APO/DPO/FPO addresses are considered domestic addresses. Refer to APO/DPO/FPO Conversion Chart below:

    ZIP Code State Code
    34000 AA
    090–098 AE
    962–966 AP

    Figure 3.11.213-5

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

3.11.213.5.4  (01-01-2015)
♦Entity Perfection - Foreign Addresses♦

  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. See IRM 3.11.213.5.3, Entity Perfection-Domestic Addresses.

  3. Route returns with a foreign address to the Ogden Submission Processing Campus (OSPC) for processing. Prepare Letter 86C to inform the taxpayer that the return has been sent to Ogden.

  4. Returns with addresses in the following U.S. Possessions/Territories are considered to be foreign 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/Territory name.

      U. S. Possession/Territory 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 for U.S. Possessions/Territories. Edit the appropriate ZIP Code if one is not provided. See Document 7475, State and Address Abbreviations, Major City Codes (MCC's), Zip Codes and Countries.

  5. All other foreign 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 the foreign country and edit the country code preceded by a "/" and followed by a "/$" (e.g., "/GM/&" is edited for Germany). See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries for official foreign country codes.

    3. A unique country code will be edited for returns filed with an address in Canada. See IRM 3.11.213.5.4.1, Country Code - Canada.

      Note:

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

    4. If the foreign address is from Australia, Brazil, Canada, Cuba, Italy, Mexico or The Netherlands, check if the address contains a province, state, or territory. See Exhibit 3.11.213-3, Province, State, and Territory Abbreviations.

      If... Then...
      A province, state, or territory name is present, 1. Circle the province, state, or territory name.
      2. Edit the appropriate abbreviation. See Exhibit 3.11.213-3.
      A province, state, or territory name is not present, Continue editing the return.
      A province, state, or territory is shown in abbreviated format, Continue editing the return.
  6. A ZIP Code or state is not required on a foreign address. Foreign addresses use a postal code that is entered before the city or foreign country and is part of the address.

3.11.213.5.4.1  (01-01-2015)
♦Country Code- Canada♦

  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 shown in the table below,
    1. Circle the country name.

    2. Edit the appropriate country code for the province/territory 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 shown in the table below,
    1. Circle the country name.

    2. Edit the country code "/CA/$" as the last entry in the address.

    Canadian Province/Territory Province 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
  2. The rest of the foreign address is edited using procedures in IRM 3.11.213.5.4, Entity Perfection - Foreign Addresses.

3.11.213.6  (01-01-2015)
Tax Period

  1. Edit the Tax Period to the right of the form title in YYMM format if the year ending is other than the current processing year (e.g. 201312). See Figure 3.11.213-6.

    Figure 3.11.213-6
    This image is too large to be displayed in the current screen. Please click the link to view the image.
  2. A REMIC return must always be a calendar year return with a Tax Period ending of December 31, unless the Form 1066 is a final return.

    If... Then...
    The return is "final" , Edit CCC "F" to the dotted portion of Section 1, Line 1 and edit the fiscal year notated on the final return.
  3. If the taxpayer indicates the Tax Period ending date is other than 12 and it is not a final return, take the following action:

    If... Then...
    Unnumbered 1. Send the return back to the taxpayer. Inform the taxpayer that all REMIC filers must file a calendar year return.
    2. Send a photocopy of Page 1, via Form 4227, to Entity Control to remove Form 1066 filing requirements.
    Numbered 1. Correspond with taxpayer to inform him or her a REMIC must file a calendar year return.
    2. Void the DLN, per local procedures.
    3. Photocopy Page 1 of the return and send it to Entity Control to remove the filing requirements.

3.11.213.7  (01-01-2015)
♦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. A Received Date is required on all Forms 1066.

    If... And... Then...
    The return is received ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ or 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 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ of the legal or extended due date, The postmark or shipment date is on or before the legal or extended due date, Edit the Received Date to agree with the postmark or shipment date.

    Note:

    For certified mail only - If a postmark Is not present, look for a "USPS.com Track & Confirm" record that has been attached to the return (should be before the envelope). Use the "Acceptance" date on the record to determine timeliness and follow normal editing procedures. Exhibit 3.11.213-4
    If the "USPS.com Track & Confirm" record is not attached, no action is required.

  3. The IRS Received Date may or may not be stamped on the face of the return.

  4. A valid IRS Received Date Stamp may consist of the following:

    • The word "Received"

    • Month (alpha or numeric)

    • Day (for example "1" or "01" )

    • Year - four digits

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

      Exception:

      Not all IRS offices are designated places for filing, and not all IRS employees are authorized to accept a tax return for processing. If a return contains a received date stamp from an office that is not a proper place for filing, that date stamp is not the "IRS Received Date" and you must circle out the invalid received date and edit the correct received date according to instructions below. For example, returns received by the Taxpayer Advocate Service (TAS) or the IRS Office of Chief Counsel are not properly filed and a received date by that office is not the "IRS Received Date" .

  5. 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 Page 1 of the return. Edit the Received Date according to the following priority:

    1. The earliest legible Postmark Date (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.
      The postmark is missing and the envelope is certified, Look for the "USPS.com Track & Confirm " record that has been attached of the return (should be before the envelope). Use the "Acceptance " date on the record to determine timeliness and follow normal editing procedures. See Exhibit 3.11.213-4.
      If the "USPS.com Track & Confirm" record is not attached, no action is required.
      An envelope has a USPS and private metered postmark, Always use the USPS postmark.
      An envelope has a foreign and private metered postmark, Always us 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:

      A private metered postmark is to be considered timely ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

    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 control date minus 10 days.

    6. Current date minus 10 days.

  6. Edit the IRS 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 stamped on the return,  
    1. Use the earliest IRS Received Date stamped on the return.

    2. Circle all other dates.

    Note:

    Received dates that have been circled out by another function should be treated as if they are not present.

    A Federal return is addressed to the IRS, Delivered to a State agency, Use the postmark date as the Received Date.
    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 Taxpayer Advocate Service (TAS) Received Date,   Edit the Received Date according to instructions.

    Reminder:

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

3.11.213.8  (01-01-2015)
♦Signature♦

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

    Note:

    If a signature does not appear on the designated line for the taxpayer's signature, follow the procedures in the IF/THEN table below.

    • Returns prepared under IRC Section 6020(b). These returns must be signed by a Compliance Function representative. See IRM 3.11.213.11.1, IRC Section 6020(b) Prepared by Collections

    • Returns prepared by Examination, for example "SFR" (Substitute for Return) or "SUBSTITUTE RETURN" . See IRM 3.11.213.11.3, Examination Prepared

      Reminder:

      Returns secured by Examination do require a signature and jurat.

    • Dummy returns prepared by IRS

    • Returns filed under IRC Section 501(d) (Religious or Apostolic Organization)

    • Correspondence containing a signature and jurat is attached showing that the taxpayer is responding to an IRS letter or notice (See paragraph (5) below.)

  2. Do not correspond for a signature on "CIS" returns that have Form 13596 attached. See IRM 3.11.213.3.4.1, Correspondence Imaging System (CIS) Returns, for processing instructions.

  3. If a signature is missing, correspond:

    If... Then...
    • The return is not signed on the line designated for the taxpayer's signature, or

    • The jurat is not present on the line designated for the taxpayer's signature (non-standard return), or

    • Only the Entity information is present and there are no attachments containing tax data,

    1. Edit Action Code "225" (Correspondence for Signature only) or "226" (International Correspondence for Signature only).
    2. Leave in batch and continue editing.
  4. If the jurat is altered or stricken (crossed-out), see IRM 3.11.213.14, Frivolous Arguments, for frivolous return instructions.

  5. Accept a "signature declaration" (e.g., a signature with a jurat obtained through IRS correspondence) if attached to the return.

    1. If the "signature declaration" is altered or stricken (crossed-out), see IRM 3.11.213.14, Frivolous Arguments, for frivolous return instructions.

    2. If the taxpayer responds with a self-prepared "signature declaration" , it must contain the same language as the jurat on the tax return: e.g., "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."

  6. Since tax examiners are not expected to be handwriting experts, Section 301.6064-1 of 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.

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

3.11.213.9  (01-01-2015)
♦Paid Preparer Section♦

  1. The Paid Preparer Section is located below the Signature area at the bottom of Form 1066.

3.11.213.9.1  (01-01-2015)
♦Paid Preparer Checkbox Indicator♦

  1. The Paid Preparer Checkbox is located next to the taxpayer signature area. 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:

    1. If... Then...
      Only 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 telephone number, if present.

3.11.213.9.2  (01-01-2015)
♦Paid Preparer's Phone Number♦

  1. The Paid Preparer's Phone Number is located below the Paid Preparer's EIN at the bottom right hand corner of Form 1066.

    If... Then...
    The return is amended, No action is required.
    The Preparer's Phone Number is more than 10 digits, No action is required.
    The Preparer's Phone Number is illegible or less than 10 digits, Circle the Phone Number.

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