The purpose of Code and Edit is to perfect returns and other documents to ready them for transcription into the Automatic Data Processing (ADP) system.

Another purpose for coding and editing is to ensure that necessary action is taken on all attachments to the return, including preparation of other documents and initiating taxpayer correspondence when necessary.

The instructions in this section pertain to the coding and editing of Form 8752, Required Payment or Refund under Section 7519, that will be input to the Business Master File (BMF).

General instructions are provided to eliminate the repetition of the same instructions for the specific return. If there is a conflict between the general instructions and the specific instructions, the specific instructions will prevail.

This manual is your main source of information. You can also find procedures in the following IRMs:

IRM 3.11.249 is exempt from the BMF Consistency Guidelines (e.g., indicating diamonds) as shown in other 3.11 Series IRMs and 3.12 Series IRMs.

The instructions in this section pertain to the coding and editing of Form 8752, Required Payment or Refund under Section 7519. The form will be filed by partnerships and S Corporations who have elected to file their income tax returns on a fiscal year basis instead of the required calendar year basis. It will be posted to the Business Master File (BMF) as Master File Tax Code (MFT) 15, Document Code 23 and Tax Class 2. Time will be charged to Program 19000 (Other BMF Returns).

Form 1065, U.S. Return of Partnership Income, and Form 1120S, U.S. Income Tax Return for an S Corporation , use Form 8752 to figure and report the payment required under Section 7519 or to obtain a refund of net prior year payment(s). A partnership (Form 1065) or S Corporation (Form 1120S) must file Form 8752 if it made a Internal Revenue Code (IRC) Section 444 election by filing Form 8716, Election To Have A Tax Year Other Than a Required Tax Year, and its election is still in effect for the tax year. Any tax year that IRC Section 444 election is in effect, including the first tax year the IRC Section 444 election/payment is made, is an "applicable election year." Prior to 1991, the IRC Section 444 payment made by these taxpayers was reported on Form 720, Quarterly Federal Excise Tax Return, under IRS Number 11.

For applicable election years beginning in 1990, Form 8752 must be filed and the required payment made on or before May 15 of the current year.

The Restructuring and Reform Act of 1998 (RRA 98), Section 3705 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.

All IRS employees, in the field, Headquarters and area offices, who communicate, by telephone, face to face, or correspondence with taxpayers or their personal authorized representatives, on tax-related matters, are required to provide (at a minimum) the following information:

Correspondence - All correspondence must include a telephone number where the taxpayer's question can be answered. In addition, manually-generated and handwritten correspondence must include the following information:

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

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

When a taxpayer requests to speak with a specific employee who previously handled his or her 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.

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 to provide additional case-related information.

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

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

It is not necessary to repeat the ID card (badge) 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 by telephone or in-person) his or her ID card (badge) number on the first contact.

Prior to faxing confidential information to the taxpayer, review fax procedures contained in IRM 11.3.1.10, Facsimile Transmission of Tax Information.

During taxpayer contact, if taxpayer mentions hardship or asks to be referred to Taxpayer Advocate Service (TAS), see IRM 3.11.249.1.5.

The Taxpayer Advocate Service (TAS) is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should.

Refer taxpayers to the Taxpayer Advocate Service (TAS) (see IRM Part 13, Taxpayer Advocate Service) when the contact meets TAS criteria (see IRM 13.1.7, TAS Case Criteria) 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 it to TAS in accordance with your local procedures.

The following subsection provides information for Taxpayer Advocate Service (TAS) - Service Level Agreement (SLA).

Each block of documents processed under the Automatic Data Processing (ADP) system is required to have a Block Control Document attached for control and identification purposes. If blocks, or unblocked documents which should have been blocked, are received without a Block Control Document, return the block to the originating area for correction. The Block Control Documents are listed as follows:

Form 813, Document Register, is used with remittance documents (W/R).

Form 1332, Block and Selection Record, is used for non-remittance documents (N/R). The Form 1332, Block and Selection Record, is also used for returns processed through the Residual Remittance Processing System (RRPS). These returns are considered non-remittance returns since the payments have been posted to the Business Master File (BMF) to provide a fact of filing.

Form 3893, Re-Entry Document Control, is used to reinput a return that has not posted to an account or module.

Form 13596, Reprocessing Returns, is used to reprocess a return to the correct account or module that had previously posted to the wrong account or module.

This section provides descriptions and functions of the Document Locator Number, blocking returns and documents, and document count.

Enter all edit marks on a document being input to the Automatic Data Processing (ADP) system with brown, red, orange, or green pencil or pen unless a specified instruction requires another type of marking. Never obliterate the original entry on a document when deleting or correcting an entry. Care should be exercised to ensure that the original entry remains legible.

The only items to be edited on the return are those to be transcribed, except where the instructions require editing of a non-transcribed item.

Edit any misplaced or illegible transcription entry to the proper transcription line. An arrow may be used if it will leave no room for doubt as to where the entry belongs.

Form 8752 is required to be edited for dollars and cents.

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

The only items edited on a 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.

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.

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

All attachments to the return must be reviewed before the return can be considered processable. Take action as required by the attachment.

Request for adjustment of another document - Remove an attachment requesting an adjustment (ADP or Non-ADP) and route to Accounts Management using a Form 4227, Intra-SC Reject or Routing Slip, for subsequent action. If the attachment does not have the taxpayer’s name, address, EIN and received date, edit this information on the attachment.

Other Unrelated Attachments - Remove other unrelated attachments (such as other returns, taxpayer acknowledgements, notices, request for tax forms, etc.) from the document being processed and route using a Form 4227 to the proper function for the necessary action. Include on the Form 4227 the following identifying information:

If the taxpayer writes the information on the return, photocopy the data and route to the appropriate function using a Form 4227.

If an attachment should be removed because the majority of the information is unrelated to the document being processed, photocopy the applicable data needed to process the document under examination and attach to the document being processed.

Form 8716, Election to Have a Tax Year Other Than a Required Tax Year - This form is an election form used by partnerships (Form 1065) and S Corporations (Form 1120S) to request fiscal year filing. If Form 8752 is received with an original Form 8716 attached, follow instructions below:

Form 8302, Electronic Deposit of Tax Refund of $1 Million or More - Do not detach. See IRM 3.11.249.14.13.

Remittance Attached - Immediately give to your supervisor. The supervisor should follow the instructions in IRM 3.8.46, Discovered Remittance.

If an attachment indicates that the taxpayer has included a tax payment for more than one tax period, take the following action:

If the taxpayer files a return for the purpose of submitting a subsequent payment, or did not include the payment with the original return, enter CCC "U" . Prepare and notate on Form 4227, "Research - Missed or Subsequent Payment" . Rejects will research to determine if the original return posted and if the payment was subsequent or missed.

Ensure that any document that must remain with the return is securely stapled to prevent its loss.

Detach any pre-assessed installment agreement and/or Form 9465, Installment Agreement Request, and route as follows:

When forwarding the installment agreement information, make sure the following is included as a working audit trail: EIN, name, type of return, tax period, amount due, amount paid.

If the taxpayer has attached a blank Form 720, Quarterly Federal Excise Tax Return, with the Form 8752, "X" Form 720 and leave attached.

If the taxpayer has a completed Form 720 attached with the Form 8752:

All taxpayer correspondence is defined in IRM 1.15.29, Records Control Schedule for Submissions Processing Campus Records.

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

All correspondence received from taxpayers must be answered and the answer should indicate: "This is in reply to your correspondence of such and such a date" , and explain the action taken, even if the action taken was exactly what the taxpayer requested.

Acknowledgement letters will no longer be sent. If the call for action has not been completed within 30 days of the IRS received date, an interim reply will be made. It should tell the taxpayer when we expect to complete the required action and provide a contact point (name and phone number) to the taxpayer. If you cannot provide a final answer to a taxpayer by the estimated deadline contained in your interim response, contact the taxpayer to provide a reason and new estimated closure date.

All correspondence to taxpayers requesting information should indicate that a response is needed within 30 days. Taxpayers should be advised of the action the IRS will take, including no action, if appropriate, if a timely response is not received. It should include this statement: "When you reply, please send us your telephone number and the most convenient time for us to call so we may contact you if we need more information" .

Whenever possible, pattern letters should be used to correspond with taxpayers. If a CNOTE or quicknote is used, be sure that it clearly communicates the message in simple language.

When taxpayer errors are discovered in processing which have caused or will cause processing delays and no other notification is sent to the taxpayer, advise the taxpayer of the reasons for the delay.

Before initiating any manual correspondence, check the Centralized Authorization File (CAF) and Reporting Agents File (RAF) to ensure the information will be mailed to the taxpayer’s representative if there is one on record.

Managers must utilize computerized reports, or if unavailable manual reports, to monitor compliance with taxpayer generated correspondence instructions in IRM 3.30.123, Processing Timeliness: Cycles, Criteria, and Critical Dates.

Examine the return so that all of the conditions can be included in the same correspondence. If additional information is needed, the second correspondence must include a paragraph of apology for any inconvenience.

Prepare correspondence using one of the following.

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.

"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.

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

Follow the correspondence instructions below for processing "CIS" returns.

Correspond using Form 3696, Form 3696-A, or other approved Correspondence Action Sheet and forward it to the Correspondence Unit.

The Customer Account Services (CAS) must request approval to accept faxed signatures of taxpayers, executors, agents, donors, employers, fiduciaries, and corporate officials on various Business Master File (BMF) returns.

One or more signatures are required on all the BMF forms before the Service can process the return. In an attempt to resolve missing signatures from returns, the Service contacts the taxpayer via a letter advising that the signature is missing. Suspend processing of the return while awaiting the response from the taxpayer. The taxpayer responds to the IRS correspondence by submitting (via mail) a signed duplicate of the previously filed return.

A "Jurat Notice" similar to that on Form 8752 will be developed.

The Preparer's Social Security Number (SSN) or Preparer Tax Identification Number (PTIN) is located to the right of the Preparer's Signature at the bottom right corner of Form 8752.

No action is required on amended returns.

The Preparer's SSN must be a nine digit number. The SSN cannot be all zeros or nines.

A PTIN is a valid entry in the Preparer’s SSN area at the bottom of Form 8752. The PTIN begins with the alpha "P" followed by an eight-digit number (e.g., PXXXXXXXX).

Circle out the Preparer's SSN or PTIN if it is invalid.

The Preparer’s Employer Identification Number (EIN) is located below the Preparer’s SSN or PTIN at the bottom right corner of Form 8752.

No action is required on amended returns.

The Preparer’s EIN must be a nine-digit number. The EIN cannot be all zeroes or all nines.

Circle the Preparer’s EIN if it is invalid.

The Paid Preparer’s Phone Number is located below the Paid Preparer’s EIN at the bottom right corner of Form 8752.

No action is required on amended returns.

If a complete Paid Preparer Phone Number is located on the Paid Preparer’s Phone Number line, no editing of this line is necessary.

If the return is for a tax period prior to 2001, circle out the phone number.

If the Paid Preparer’s Phone Number is incomplete, illegible or less than 10 digits, quickly review the return and all attachments.

Even though a return may be considered valid for filing and timeliness purposes, it may not be processible. It is unprocessable if:

A return must contain specific items before it is considered processible. Examine schedules and other attachments for the information necessary to make the document processible and enter on the applicable return. The specific items needed are:

Returns with unresolved entity problems should be routed to Entity Control for research.

If the return has multiple EIN’s, an EIN that is missing, "applied for" , pending, etc. or the Name is illegible, take the following action:

For other unprocessable conditions, initiate correspondence if you have a name and address and research cannot resolve the issue.

Route unprocessable returns to the Correspondence Unit using a Form 4227 for the HOLD FILE for the following reasons:

Do not send the following unprocessable returns to the HOLD FILE:

When a signed perjury (declaration) is received, attach it to the return.

Complete the return based on the information submitted by the taxpayer.

If a Form 6800, Request for Missing Information or Papers To Complete Your Tax Return or Form 8038-CP, or a letter is attached which bears the received date stamp, but there is no date stamp on the return, edit the date (as stamped on the attachment) on the return.

Only one correspondence attempt is required. If a reply is not received after the prescribed suspense period, input the return.

Edit Computer Condition Code "X" on an overpaid return. Do not change the received date.

Reject a document for the following reasons:

Prepare Form 4227, Intra-SC Reject or Routing Slip. Indicate the reason for rejection, and attach the form to the face of the document immediately under the entity data for the following:

Blocked and numbered documents that have been coded and edited will be sent to Data Conversion for transcribing.

Unnumbered documents that have been coded and edited will be sent to Receipt and Control for blocking and numbering.

Documents leaving the campus will be sent to Receipt and Control for shipment. Prepare Form 4227 with applicable routing instructions.

Documents not leaving the campus will be sent to the appropriate function in the campus for the required action. This includes items detached from documents to be processed that require correspondence, accounting, or other action. See IRM 3.11.249.4.2(2)for preparation of Form 4227, Intra-SC Reject or Routing Slip.

A frivolous argument is used for the purpose of expressing dissatisfaction with the substance, form, or administration of the tax laws by attempting to illegally avoid or reduce tax liabilities. Recognized frivolous arguments made by business include, but are not limited to, the examples in IRM 4.10.12, Examination of Returns - Frivolous Return Program (FRP). Also, see Exhibit 3.11.249-2, Potential Frivolous Arguments for Examination Review .

Review the return to determine whether it appears to be a frivolous return.

For returns completed in other than U.S. currency, process as filed. However, if corresponding for missing/incomplete item(s), include in the letter (e.g., 3463C) to resubmit return in U.S. currency.