3.13.2  BMF Account Numbers (Cont. 1)

3.13.2.6 
Integrated Data Retrieval System (IDRS)

3.13.2.6.1 
Research Command Codes (CCs)

3.13.2.6.1.4  (01-01-2014)
CC ENMOD

  1. This CC is used to provide a taxpayer's Entity account; BMF, IMF (Individual Master File), NMF (Non Master File), IRAF (Individual Retirement Account File) and EPMF (Employee Plans Master File). This CC shows all of the Entity data and transactions available on the Taxpayer Index File (TIF).

  2. The use of CC ENMOD is required prior to accessing CCs ENREQ, BNCHG, and INCHG.

  3. All Entity transactions post to CC ENMOD. Once CC ENMOD falls from the TIF, all Entity transactions are displayed on CC BMFOL'E'.

  4. There are two new indicators for IDRS that will be displayed on CC ENMOD or CC BMFOL'E.' The indicators are Undeliverable As Addressed "UAA" and Undelivered "UD" . UAA will generate from FINALIST when it's not able to expand or hygiene an address. UD is generated from the input of TC 971 Action Code 661 when mail is received back from USPS as undeliverable.

  5. See IRM 2.3.15, IDRS Terminal Responses - Command Code ENMOD, for more information about CC ENMOD

3.13.2.6.1.5  (01-01-2015)
CCs FINDE/FINDS

  1. There are two new CCs to query the NSF database. When an EIN or SSN is entered, every name and address reported to that EIN will appear on your screen.

  2. CC FINDE searches the NSF data base using the taxpayer’s EIN and requires either of the following definers:

    1. D – Only BMF Domestic names and addresses are displayed.

    2. I – Only BMF International names and addresses are displayed.

  3. CC FINDS searches the NSF data base using the taxpayer’s SSN and requires either of the following definers:

    1. D – Only IMF Domestic names and addresses are displayed.

    2. I – Only IMF International names and addresses are displayed.

  4. To search using CC FINDE/FINDS, input the appropriate CC plus the definer D or I and use the taxpayers EIN/SSN (without hyphens or dash).
    Example
    FINDED020278969, will display the domestic names and addresses for EIN 02-0278969.
    The domestic or international addresses/names for the appropriate EIN will display in cycle/year order. The most current taxpayer information will display first and includes any subsequent names/addresses displaying in descending order.

  5. The cycle format has been updated to YYYYMMDD.

  6. See IRM 2.3.60 , Command Codes NAMES, NAMEE, NAMEI, NAMEB, FINDS, FINDE, and TPIIP for additional information.

3.13.2.6.1.6  (01-01-2014)
CCs INOLE, BMFOL

  1. Command Code INOLE is designed to display Master File entity data (including SSA name controls, Cross Reference information, and Merge Transactions) for a specific Taxpayer Identification Number (TIN) residing on the NAP. The request type (via command code definer) determines the kind of data desired by the requester. Requests are researched via the input TIN. If primary TIN is unknown, a request may be input with the spouse's TIN. There are five types of INOLE inquiries that can be requested.

  2. Command Code INOLE input with the definer "G" — an unedited or edited TIN will be input. This command will be useful when the tin type is unknown. The returning screen will contain any nameline information available for any account attributable to that number, regardless of file if edited TIN is input. This request type involves multiple database accesses and should be used only when necessary.

    1. Command Code INOLE input with the definer "T" — an edited TIN (either SSN or EIN) and file source will be input. This command will be useful when research is desired on all accounts with the same SSN or EIN. Nameline and street address information will be returned to the user for each matching account.

    2. Command Code INOLE input with the definer "S" — an edited TIN and file source will be input. This request type will be most useful when the specific account is already known. Name lines (current and prior), street addresses, tax year, Social Security name controls, cross reference and other information specific to the type of account being requested will be returned to the user.

    3. Command Code INOLE input with the definer "X" — an edited TIN and file source will be input. This request type will be most useful when researching TINs that have no Master File account. DM1 name controls, Cross reference and merge transaction information will be returned to the user. Information returned to the user will be specific to the file source input. On SSN requests, both tin types (valid and invalid) will be searched for data, regardless of file source input. If a file source of IMF valid is input, the resulting display will show data for both the valid and invalid accounts if such data exists.

    4. Command Code INOLE input with the definer "P" — an edited EIN, file source (P), and EPMF Plan number. This request type will be used to display EPMF Plan information. The EPMF SPECIFIC SCREEN is capable of displaying only five plan names. The screen display for the "P" definer is able to display up to ten plan names. The list of plan names displayed will begin with the plan number that is input, or the next highest number.

  3. The Business Master file on-line , BMFOL system provides read-only access to accounts on the Business Master File in Martinsburg, WV. All entities, master file tax modules and the most recent seven years of retention data are in on-line status. See IRM 2.3.59, IDRS Terminal Responses - Command Codes BMFOL and BMFOR.

    1. CC BMFOL with Definer "E" will show all Entity transactions posted to the Master File. This definer will also show
      Parent's EIN,
      X-REF TIN (owner's TIN),
      Railroad Retirement Board Number,
      Wages Paid Date/Business Operational Date and Business Close Date/Wages Last Paid Date,
      Employment Codes,
      Active FRCs,
      Entity module: Name, Address Fields.

    2. Definer "I" will show the modules that have been created on the EIN with an extension, return, or transaction code. The modules are listed in order of MFT. Entity will utilize several fields of the screen display.
      MFT
      TXPD (Tax Period
      RET PST (Return Posted, Y=yes, N=No)

    3. Definer "T" shows the specific tax module being viewed.
      Input the command code as follows:
      BMFOLTNN-NNNNNNN XXXXXXXX (X=MFT and Tax Period)

    4. Definer "R" shows the specifics of the return posted on the module. The input format is the same as Definer "T"

3.13.2.6.1.7  (01-01-2014)
CCs SUMRY/TXMOD

  1. Command Code SUMRY should normally be used as a first contact with IDRS to determine if a tax module or Control Base exists in the TIF. The SUMRY display will show sufficient data to enable operators to close many cases and associate others in process without further research.

  2. CC SUMRY is used to request for display, a summary of a taxpayer's account which includes all tax modules meeting IDRS selection criteria. The display shows entity data on lines 1 and 2. Tax Module Data, including tax period, various indicators, IDRS Status, Control Base information, Control DLN, IDRS Module Balance and Freeze Codes for a specific tax period begins on line 3 and ends on line 4. Other tax period data follows every two lines until all tax modules have been summarized.

  3. Command Code TXMOD is used to request for display all tax module information for a specific tax period on the TIF. The display consists of Entity data, posted returns, posted transactions, pending transactions, and reject data if available on IDRS TIF. The display shows the latest control DLN of the return.

  4. Command Code TXMOD stores the TIN, File Source, TIN Type, MFT, Tax Period, Case Control Indicator, Name Control and, for EPMF, Plan Number as required data elements for subsequent processing.

  5. For TXMOD a command code definer is required. Definer "A" will display most tax module information present on the TIF.

  6. For more information on CCs SUMRY and TXMOD, see IRM 2.3.11, IDRS Terminal Responses - Command Codes TXMOD and SUMRY.

3.13.2.6.1.8  (01-01-2014)
CCs RTVUE/BRTVU

  1. These CCs will display return information for both BMF and IMF.

  2. See the IDRS Command Code Job Aids on SERP for additional information on CC BRTVU and CC RTVUE.

3.13.2.6.1.9  (01-01-2015)
CC ESTAB

  1. Use CC ESTAB to request documents from Files.

    Note:

    Whenever possible CCs BRTVU and/or RTVUE will be used instead of CC ESTAB.

  2. When requesting documents with CC ESTAB the DLN must be known.

    1. A Form 4251, Return Charge-Out, will be generated to Files for the document.

    2. Files will pull the document and route it to the requester.

  3. When requesting documents with CC ESTAB the file and type of information needed must be input.

  4. Be sure to use Form 2275, Records Request, Charge and Recharge, if document is not received after three timely requests.

  5. For additional information on CC ESTAB, see IRM 2.3.62 , IDRS Terminal Response - CC ESTAB and IRM 2.3.17, IDRS Terminal Responses - Command Code ESTABD.

3.13.2.6.1.10  (01-01-2014)
CC TRDBV

  1. This CC is used to access tax return information after corrections have been made to the return by ERS and/or GUF.

  2. CC TRDBV is especially useful to Entity and Entity Unpostable TEs as it will show a DLN that has been renumbered or cancelled.

  3. Any case or document being processed under a Revenue Procedure will require the use of CC TRDBV.

  4. See IRM 2.3.73, Command Code (CC) TRDBV.

  5. Review of the IDRS Command Code Job Aid on SERP would be beneficial, see CC TRDBV .

3.13.2.6.1.11  (01-01-2014)
CC MFREQ

  1. CC MFREQ Definer 'C' is used to request the Entity module or a tax module and its related entity data when case control is not required.

  2. MFREQ 'C' will download the module data from CFOL to the local IDRS while the user is waiting online.

  3. CC MFREQ Definer 'D' will bring the module data from Master File to IDRS approximately two weeks from the time of the request.

  4. MFREQ 'D' will create a dummy module on the local IDRS while waiting for IDRS information to load.

  5. The real module must not be on the local IDRS (TIF) for CC MFREQ to be used.

  6. See IRM 2.3.10.

3.13.2.6.1.12  (01-01-2014)
CC EFTPS

  1. CC EFTPS is used to access payments made through the Electronic Federal Tax Payment System (EFTPS).

  2. This CC is not restricted.

  3. See IRM 2.3.70.

3.13.2.6.1.13  (01-01-2014)
CC UPTIN

  1. CC UPTIN displays all open and closed Unpostables for a specific TIN and will maintain the Unpostable on it's file for display purposes for 90 days after it is closed.

  2. Each Unpostable Record will be sorted first by TIN, MFT, Tax Period and Transaction Code.

  3. The CC UPTIN data will be updated daily.

  4. Entity TEs working returns and issues involving Forms 2553 and 8832 should access CC UPTIN at both BMF campuses to get a clear picture of the taxpayer's case. If there is an open UPC 310/329, coordinate with the appropriate BMF Entity Unpostable Team:

    • Cincinnati - 859-669-4025 or 4012

    • Ogden - 801-620-6123 or 7093

    Note:

    Phone numbers are for internal use only.

3.13.2.6.1.14  (01-01-2014)
CCs UPDIS/UPRES

  1. CC UPDIS will display the open unpostable case for a specific sequence number. CC UPDIS must be used prior to CC UPCAS and CC UPRES.

  2. CC UPRES allows the user to take action on the unpostable, either suspend or close.

  3. See IRM 2.3.48, IDRS Terminal Responses - Command Code UPDIS for the GUF System.

3.13.2.6.1.15  (01-01-2015)
CC IRPTR

  1. Command Code (CC) Information Returns Processing Transcript Requests (IRPTR) allows IDRS users to request either on-line or hardcopy Information Returns Processing (IRP) transcripts from the Information Returns Master File (IRMF).

  2. CC IRPTR can be used to request data, either online or hardcopy transcripts, for a particular Payee (online or Hardcopy) or Payer (Hardcopy only) using Taxpayer Identification Number (TIN) along with one or more Tax Years (TY).

  3. See IRM 2.3.35, IDRS Terminal Responses - Command Code IRPTR.

  4. The IDRS Command Code Job Aid for CC IRPTR will show how to use the CC.

3.13.2.6.2  (01-01-2015)
CC ESIGN

  1. BMF returns and payments are processed with Employer Identification Numbers (EINs). EINs are assigned from paper Forms SS-4 by Accounts Management, EIN Function. A taxpayer can also obtain an EIN by calling the EIN function at 1-800-829-4933 or by going online at http://www.irs.gov.

  2. This CC allows you to assign an Employer Identification Number (EIN). Always thoroughly research CCs NAMEE/NAMEB prior to initiating CC ESIGN. Always research using the "sort line format" and the Modernized Internet EIN "enter as taxpayer did" format.

  3. EINs are also assigned by Entity TEs when processing returns and payments in the form of "pipeline" , Rejects, and loose, unnumbered documents.

  4. The service no longer requires specific District Office codes to be used as the prefix for EINs assigned. When assigning an EIN, the Business Master File (BMF) sites will use (have used) the following prefixes:

    • Andover - 10, 12;

    • Atlanta - 60, 67;

    • Austin - 50, 53;

    • Brookhaven - 01, 02, 03, 04, 05, 06, 11, 13, 14, 16, 21, 22, 23, 25, 34, 51, 52, 54, 55, 56, 57, 58, 59, 65;

    • Cincinnati - 31,30, 32, 35, 36, 37, 38, 61;

    • Fresno - 15, 24;

    • Kansas City - 40, 44;

    • Memphis - 94, 95;

    • Ogden - 80, 90;

    • Philadelphia - 33, 39, 41, 42, 43, 45, 46, 47, 48, 62, 63, 64, 66 (reserved for taxpayers located in Puerto Rico, Guam, Virgin Islands, American Samoa, Northern Mariana Islands and Palau), 68, 71, 72, 73, 74, 75, 76, 77, 81, 82, 83, 84, 85, 86, 87, 88, 91, 92, 93, 98, 99;

    • Modernized Internet EINs - 20, 26, 27, 45, 46, and 47 (The File Location Code (FLC) for TC 000 on EINs assigned via Mod IEIN will always be "28." ;

      Note:

      Long before the creation of Mod IEIN, Philadelphia used prefixes 26 and 27 but had stopped.

    • International EINs will begin with prefix 98; and

    • Invalid EIN Prefixes are 00, 07, 08, 09, 17, 18, 19, 28, 29, 49, 69 (see IRM 21.7.13.2.4.1), 70, 78, 79, 89, and 96. EINs with one of these prefixes should never be put on Master File with a TC 000.

  5. CC ESIGN will not allow the Primary Name line and the Sort Name line to be identical.

  6. If the assigned EIN has FRCs that are liable for federal tax payments, the taxpayer is pre-enrolled in the Electronic Federal Tax Payment System (EFTPS).

  7. Entity will complete every possible field of CC ESIGN when assigning an EIN. See IRM 2.4.8, IDRS Terminal Input - Command Codes ESIGN and BSIGN, IRM 21.7.13, Business Tax Returns and Non-Master File Accounts - Assigning Employer Identification Numbers (EINs), and the IDRS Command Code Job Aid on SERP. The X-REF TIN TYPE and TIN of the entity's owner are required fields. If the taxpayer is a sole proprietor, we will also complete the SOLE PROPRTR SSN field.

  8. If you do not have the entity owner's TIN, a "9" will be entered in the X-REF TIN TYPE field. The X-REF TIN and X-REF TIN TYPE Fields will not be completed for non-profit organizations.

  9. See Exhibit 3.13.2-9.

  10. For disposition of Form SS-4, see IRM 21.7.13.3.2.11.

  11. The validity checks on filing requirements for CC ESIGN are listed in the chart below

  12. The valid range of values for Form 941 are 01, 02, 06, or 07. A Form 941 FR must have a "wages paid date" .

    If... Then...
    Form 941 FRC = 01 Form 940 FRC must be 1 or 2, unless EC is "G" or "W"
    Form 941 FRC = 02 EC must be "F" and Form 940 FRC must be blank
    Form 941 FRC = 06 Location Code must be 6601. Form 940 FRC must be "7" unless EC is "W"
    Form 941 FRC = 07 Location Code must be 6601. Form 940 FRC must be 1 or 2,. or "F" EC must be # or blank
    Form 944 FRC = 01, 02, 06, 07 Form 944 FRC is generated by Master File.
    Form 944–SS FRC= 06 Form 944 FRC is generated by Master File.
    Form 944–PR FRC = 07 Form 944 FRC is generated by Master File
    Form 1120C FRC = 0, 20 See CC EOCHG for positive filing requirements. A Form 1120C FRC 0 will delete the Form 1120C filing requirement on the BMF.
    Form 1120 FRC = 01, 03, 04, 06,07, 09, 10, 11, 16, 17, 18, 19, or 20 "Fiscal Year Month" (FYM) must be input The "Business Operation Date" (BOD) must be input. A FRC for Form 1065, 1066 or 1041 cannot be input.
    Form 720 = 1 or 4. The "Business Operation Date" must be input.

    Note:

    A Form 720 FRC is valid with all other filing requirements.

    Form 1041 = 1 or 2. The "Business Operation Date" must be input. The "Wages Paid Date" for FRC 2 must be present. A FRC for Form 1065, 1066 or 1120 cannot be input. The FYM must be input.
    If the FRC is 1041-1 only, CC ESIGN will generate an EIN within the six/seven million series
    Form 1041 QFT = 9 The "Business Operation Date" must be input. A FRC for Form 1065, 1066 or 1120 cannot be input. The FYM must be input.
    Form 1065 = 1 The "Business Operation Date" must be input. A FRC for Form 1041, 1066 or 1120 must not be input. The FYM must be input.
    Form CT–1 = 1 or 2 The "Business Operation Date" must be input. A Form 941 FR of 04 may also be input.
    Form 940 = 1, 2 or 7 The "Wages Paid Date" must be input.
    Form 940 FRC = 1 The Form 941 FR must be 01 or 06. The Form 943 FRC must be 1.
    Form 940 FRC = 2 The Form 941 FR must be 01 or 06. The Form 943 FRC must be 1.
    Form 940 FRC = 7 The location Code must be 6601. Form 941 FRC must be 7. The Form 943 FR must be 7.
    Form 943 = 1 or 7 The "Wages Paid Date" must be input,
    Form 943 = 7 The location code must be 6601.
  13. Form 945 valid range is 1. Form 945 FR is valid with all other filing requirements. If Entity can determine by taxpayer contact or the taxpayer indicates that they are liable to file Form 945 (for example, liable for non-payroll income tax withholding on backup withholding or withholding for pensions, annuities, IRAs, Indian gaming and gambling winnings) establish Form 945 FRC 01. Otherwise, DO NOT establish a 945 FRC. Form 1042 valid ranges are 0, 1 or 8. Form 1042 FR is valid with all other filing requirements. See Figure 3.13.2-2 for the CC ESIGN format.

    Form 2290 = 1 The "Business Operation Date" must be input.
    Form 1066 = 1 The "Business Operation Date " must be input. A FR for Forms 1120, 1041 and 1065 cannot be input.
    Form 11-C = 1 The "Business Operation Date" must be input.

    Note:

    Most Forms 11–C are not required to file Form 730

    Form 730 = 1 The "Business Operation Date" must be input. The FRC for Form 11–C must be a 1.

    Figure 3.13.2-2

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

3.13.2.6.3  (01-01-2014)
Update CCs

  1. This subsection covers IDRS CCs that are used to update Master File.

  2. For additional information on any CC, see the IDRS Command Code Job Aids on SERP.

3.13.2.6.3.1  (01-01-2014)
CC ACTON

  1. Command Code ACTON may be used to establish control bases, to update or close control bases that are open, to correct name controls on dummy accounts, to add history items to modules on IDRS, and to generate TCs 902 to secure tax modules and their related entity data from the Master File.

  2. For more information on CC ACTON, see IRM 2.3.12 , IDRS Terminal Responses - Command Code ACTON and CC ACTON.

3.13.2.6.3.2  (01-01-2015)
CC ENREQ/BNCHG

  1. CC ENREQ must be preceded by CC ENMOD. For specific information on character/space limitations for CC ENREQ/BNCHG, see IRM 2.4.9, IDRS Terminal Input - Command Codes ENREQ, INCHG, IRCHG, BNCHG and BRCHG.

  2. The following list reflects the filing requirements that can be input with CC ENREQ/BNCHG. With CC BNCHG a filing requirement can be added, changed or deleted on the BMF.

  3. Form 941 valid ranges are blank, 00, 01, 02, 04, 06, 07, 09, 10, 11, 13 or 14. A Form 941 FR 00 will delete the Form 941 filing requirement on the BMF.

    If... Then...
    Form 941 FR = 01 Form 940 FR must be a 1 or 2, unless EC input is: "W" , "G" or "T" is also input.
    Form 941 FR = 02 There must also be input an EC of "F" .
    Form 941 FR = 04 A TC 070 must be posted. See IRM 3.13.12, Exempt Organization Account Numbers
    Form 941 FR = 06 The location code must be 6601 or 9801.
    Form 941 FR = 07 The Form 940 FR must be a "7" , unless the EC input is a "W" or "T" .
    Form 941 FR = 09 The transaction code cannot be 000.
    Form 941 FR = 11 If an EC is present, it must be: "T" , "S" , "M" , "W" or "9" .
    If an EC is not present, input a Form 940 filing requirement code of "1" or "2"
    Form 941 FR = 13 The location code must be 6601.
    Form 941 FR = 14 The location code is input it must be 6601. If an EC is present it must be "W" or "T" and the Form 940 filing requirement code must not equal a "1" , "2" or "7" .
    If an EC is not present, the Form 940 filing requirement code must be "7"
    Form 944 FR = 01, 02, 03, 11
    944 SS FR = 06, 13
    944-PR FR = 07, 14
    Input 00 to remove the Form 944 FR. Use (0-9) to establish the 944 Establishment Year in year format (YYYY).
  4. Form 1120 valid ranges are blank, 00, 01, 03, 04, 06, 07, 09, 10, 11, 16, 17,18, 19 or 20. A Form 1120 FR-0 will delete the Form 1120 filing requirements on the BMF.

    Note:

    If a Sole Proprietor SSN is present on an EIN, an annual FRC (MFTs 02,05,06, etc.) cannot be added. If needed, delete the Sole Proprietor SSN by entering 000-000-0001.

    If... Then...
    Form 1120 FR = 01, 03, 04, 06, 07, 09, 10, 11, 16, 17, 18, 19 or 20 The FYM must be input
    A filing requirement for Form 1041 or 1065 must not be input or must be zero.
    Form 1120 FR = 15 The input campus must be OSC.
    Form 720 FR = 9 The transaction Code cannot be 000.
    Form 1041 FR = 1 or 2 The FYM must be input. A filing requirement for Form 1065 or 1120 must not be input, unless it is zero.
    Form 1065 FR = 1 The FYM must be input. A filing requirement for Form 1041 or 1120 must not be input, unless it is zero.
    Form 1066 FR = 1 A filing requirement for Form 1120, 1041 or 1065 cannot be input, unless it is zero. The FYM must be 12.
    Form CT–1 FR of 1 or 2 The Railroad Retirement number must be input.
    Form 940 FR = 1, 2, or 7 A FR for Form 941, or 943 must be input.
    Form 940 FR = 1 A Form 941 FR of 01, 09, or 10 must be input. A Form 943 FR of 1 must be input.
    Form 940 FR = 2 A Form 941 FR of 01, 09, or 10 must be input. A Form 943 FR of 1 must be input.
    Form 940 FR = 7 A Form 941 FR of 7 must be input. A Form 943 FR of 7 must be input.
    Form 943 FR = 7 The location code must equal "6601" .
  5. Form 1042 valid ranges are blank, 0 or 1. A Form 1042 FR 0 will delete the Form 1042 filing requirement on the BMF.

  6. Form 990-T valid ranges are blank, 0 or 2. A Form 990-T FR 0 will delete the Form 990–T filing requirement on the BMF. Form 990-T FR = 2; The FYM must be input. A Form 1041, 1065 or 1120 filing requirement greater than zero cannot be input.

  7. Form 5227 valid ranges are blank or 0. A Form 5227 FR 0 will delete the Form 5227 filing requirement on the BMF. Use CC EOCHG to add/update FRC.

  8. Form 990–PF valid ranges are blank or 0. A Form 990–PF FR 0 will delete the Form 990–PF filing requirement on the BMF. Use CC EOCHG to add/update FRC.

  9. Form 2290 valid ranges are blank, 0 or 1. A Form 2290 FR 0 will delete the Form 2290 filing requirement on the BMF.

    If... Then...
    Form 11–C FR = 1 Form 11–C FR must be 1.
    Form 730 FR = 1 Form 730 FR must be 1.
  10. Forms 990/990EZ valid ranges are blank or 0. A Form 990 FR 0 will delete the Form 990 filing requirements on the BMF. Use CC EOCHG to add/update FRC.

    If... Then...
    Form 706GS(D) = Blank, 0 or 1 Input must be to a BMF EIN or SSN account only. MFT must be input to update Form 706GS(D) FRC.
    Form 706GS(T) = Blank, 0 or 1 Input must be to a BMF EIN account only.
    Form 706GS(T) FRC = 1 Only Forms 1041, 720, 940, 941 or 943, 944 FRCs may be input.
  11. Form 945 valid ranges are blank, 0, or 1. A Form 945 FR = 0 will delete the Form 945 filing requirement on the BMF. Form 945 is valid with all other filing requirements. If Entity can determine by taxpayer contact or the taxpayer indicates that they are liable to file Form 945 (for example, liable for non-payroll income tax withholding on backup withholding and withholding for pensions, annuities, IRAs, and gambling winnings) establish Form 945 FRC 01. Otherwise, DO NOT establish a 945 FRC.

  12. Not Required

    1. Valid range blank, 0 or 1.

    2. This field is used when the EIN needs to be placed on the BMF, but a filing requirement is not necessary. See Figure 3.13.2–3.

  13. Use this CC to request a BNCHG format for input of an entity change transaction. It must be preceded by CC ENMOD.

    1. ENREQ is designed to initiate BNCHG. CC ENREQ with a blank definer is keyed in after a response to ENMOD indicates that the entity is on the file. Response to "ENREQ" is a generated BNCHG format for BMF.

    2. CC ENREQ with an "R" definer is keyed in after response to ENMOD indicates that the entity is on the file. Response to CC ENREQ'R' is a generated BRCHG format for BMF or EPMF accounts.

    Figure 3.13.2-3
    This image is too large to be displayed in the current screen. Please click the link to view the image.
  14. The TIN will be validated with CC ENREQ and EOREQ. In order for a TC 000 to be input, a TC 000 intend indicator of 1 must be input in space 20 with the CCs ENREQ or EOREQ. If the TIN is not on the Master File when the indicator is input it will allow the TC 000 to post. If the TIN is known to be on the Master File and no TC 000 intend indicator is input the appropriate TC (those other than TC 000) can be input. See Figure 3.13.2–4

  15. When the TIN has been validated the input transaction can be made. If the TIN is not validated, research or contact the taxpayer.

  16. If research or taxpayer contact does not resolve the discrepancy in the TIN, each case will have to be resolved based on the taxpayer's change.

  17. If a TC 000 intend indicator is input and the TIN is already on the MF, an error message "TIN EXISTS ON MF" will be generated.

    1. Compare the input TIN with the source document to determine if a transcription (finger) error was made.

    2. If a finger error has been made, correct the EIN and re-input the transaction. Be sure the TC 000 intend indicator is correct.

    3. If a finger error was not made, research using CC INOLE and NAMEE to ensure the EIN is for the taxpayer. If it is, it may be necessary to make an entity change. Re-input the transaction and change the TC 000 intend indicator to blank.

    4. If the input TIN is on the MF for a different taxpayer, assign a new EIN if the source document is other than correspondence. If the source document is correspondence, return it to the taxpayer with a Form SS–4 explaining that the EIN has already been assigned to another taxpayer. Before their correspondence can be processed, a valid EIN is needed.

  18. Because the ESIGN (TC 000) is held for quality review, care will be taken when changing information while the transaction is pending. If Quality Review needs to reject the ESIGN, the transaction will not post. If it is determined that the action must be input, use CC ENREQ with an intend indicator 1 to access the dummy module and use posting delay code as needed.

  19. The TE establishing the EIN needs to add to or change information, input CC ENREQ with an intend indicator 1 to access the dummy module. This will access CC BNCHG. Input the additional or correct information required and use posting delay code as appropriate.

  20. Complete research (including CC INOLE if necessary) will be performed prior to should be done prior to executing any entity change. Any transaction that needs to be cycled or held for later input can now be cycled up to 6 cycles using a Posting Delay Code (PDC). See IRM 2.4 , IDRS Terminal Input.

  21. If the information that will print on the CP 575 needs to be changed, such as mailing address, primary name line, etc. use CC ESIGN'T' to remove the newly assigned number. Reassign an EIN to allow the CP 575 to be delivered with the correct information.

  22. The transactions input with CCs ENREQ/BNCHG follow:

  23. Transaction Code 000: This transaction code establishes an account on the BMF (See Figure 3.13.2–3). The following fields must be input:

    • TC 000, and

    • New Name Control, and

    • Primary Name, and

    • Complete Address, and

    • Filing Requirement (If a filing requirement is not needed, input a "1" in the NOT-REQUIRED field. See Figure 3.13.2–3.)

      Exception:

      If the TC 000 is input for a BMF SSN account, then no filing requirements should be input, including NOT REQUIRED.

      Note:

      Complete research (including CC INOLE if necessary) will be performed before executing any entity change. Any transaction that needs to be cycled or held for later input can be cycled up to 6 cycles using a PDC. See IRM 2.4 , Terminal Input.


    If the EIN assigned has FRCs that require federal tax payments, the taxpayer is automatically pre-enrolled in EFTPS.
    The "Notice of Intent" indicator 1 must be entered in line 1, space 20 of IDRS screen when establishing an EIN with a TC 000.

    Figure 3.13.2-4

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  24. Transaction Code 012: This transaction code reopens an inactive account where a consolidation has been attempted but failed (because of duplicate modules, invalid FRCs, etc.) or a TC 020 failed because modules exist (See Figure 3.13.2–5). Filing requirements of such accounts are all "8."

    The transaction will not post to the account unless all filing requirements are changed to either a significant code or zero.

    Note:

    Do not re-open an EIN if the words "ID THEFT " or "FRAUD " are on one of the name lines.

    Caution:

    The Detroit Computing Center (DCC) was assigned an EIN ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ for the sole purpose of providing the “Payer” EIN on Form 1099-INT statements issued by IRS to taxpayers who have received interest on their federal refunds. The Detroit Computing Center is not a “true” taxpayer account entity. Do not input a TC 012 or post payments or returns to this account. Refer to SERP Alert 12A0279

    Figure 3.13.2-5

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  25. Transaction Code 013: This generated transaction code indicates the primary name line has been changed. See Figure 3.13.2–6.

    1. Always use the Master File name control, not a check digit or dummy name control when changing the name lines.

    2. If it appears that a change in ownership has occurred which will require a new EIN, correspond with the taxpayer using Letter 45C.

    3. Name changes to SSN accounts will be processed using TC 040 or TC 041.

    4. A name change can be processed from any type of correspondence, return, payment, etc., if one of the following is indicated in the examples; Formerly Known As (FKA); Also Known As (AKA); New name; Old name; Name change box is checked on a return (if present). You may research the Secretary of State's web site(s) for name change verification. If truly needed, phone contact with the taxpayer can be initiated.

    5. If none of the above is indicated, correspond with the taxpayer to verify the correct name.

    6. If correspondence, notices, or C letters sent by the Service that solicits or requires a response from the taxpayer are returned to the Service by the taxpayer with corrections marked on the taxpayer's Primary Name information, the correspondence will constitute clear and concise written notification of a name change. The taxpayer's signature is not required on the correspondence, notice or C letter.

      Figure 3.13.2-6

      This image is too large to be displayed in the current screen. Please click the link to view the image.
  26. Transaction Code 014: This generated transaction indicates a change has been made to the mailing address fields. All transactions containing an address change will have the requester's name, title, and phone number if present in the Remarks field of the transaction. If you are unable to determine the name and/or title, enter "SIGNATURE ILLEGIBLE" and the requester's phone number (if available). See Figure 3.13.2-7.

    Figure 3.13.2-7

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  27. Transaction Code 016: This generated transaction code indicates a change to any of the following fields:

    • BMF filing requirements/WPD/BOD;

    • Railroad Retirement Board Numbers;

    • Form 8123 code;

    • Fiscal Year Month (FYM);

    • Employment Code (EC);

    • Date of Death;

    • Sole Proprietor SSN;

    • Sort Name;

    • Location street address;

    • Location city, state, and ZIP;

    • Care Of Name;

    • X-REF-TIN-ITIN-IND/X-REF-TIN-ITIN;

    • DT-WG-L-PD/DT-BUS-CLD; and

    • See Figure 3.13.2-8.

    1. To delete an erroneously input Sole Proprietor SSN, input SP000–00–0001 in this field. To correct a wrong SSN, input the correct sole proprietor SSN. It will be over laid in the sole proprietor SSN field. To delete an erroneously input X-REF TIN, input "0" in the X-REF TIN IND field and enter 000-00-0001 in the X-REF TIN field, minus hyphens. To correct a wrong X-REF TIN, input the correct XREF TIN. Overlay it in the X-REF TIN field.

    2. These items are input as a result of correspondence and unprocessable returns and documents.

    3. A TC 016 with special DLN XX963-888-88888-X is generated to validate sole proprietor's Social Security Number (SSN) in the entity.

    Figure 3.13.2-8

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  28. Transaction Code 020: (This Transaction Requires Management Approval) This input transaction code deletes an account from Master File if no modules are present which contain return or credit transactions. Recently this TC has been used on EINs resulting from ID Theft or Fraud. When this is the case, the words "ID THEFT" or "FRAUD" will be entered on the Continuation of the Primary Name Line. This TC is restricted to BMF Entity TEs. See Figure 3.13.2–9.

    Note:

    Accounts with modules present will remain on the BMF but all the filing requirements will be changed to "8" to indicate that the account is in inactive status.

    Figure 3.13.2-9

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  29. Transaction Code 030: This generated transaction code indicates the location codes have been updated when a change in campus code is involved. If a TDA is being transferred, use document code 50; otherwise, use document code 63.

  30. Transaction Code 040: This input transaction code changes an SSN or name of an account to the valid portion of the BMF. See Figure 3.13.2-10.

    1. This transaction must be input to a BMF valid SSN account.

    2. If Primary Name is entered, New Name Control and Continuation of Primary Name are the only fields that may be entered. Remarks must also be entered.

    3. If new SSN field is entered, Posting Delay Code and the Remarks fields are the only other fields that may be entered.

    4. For specific instructions on inputting TC 040, see IRM 2.4.9-6.

    Figure 3.13.2-10

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  31. Transaction Code 041: This input transaction code changes an SSN or name of an account to the invalid portion of the BMF. This transaction must be input to a BMF invalid SSN account. See Figure 3.13.2-11.

    1. This transaction must be input to a BMF invalid SSN account.

    2. If Primary Name is entered, then no other data except Continuation of Primary Name may be entered. Remarks must be entered.

    3. If a new SSN is entered, then no other data except Posting Delay Code and the Remarks field may be entered.

    Figure 3.13.2-11

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  32. Transaction Codes 07X: TCs 076, 077, 078, and 079 are used when processing Form 8832, Entity Classification Election. TCs 070 through 073 are used when processing Form 8274, Certification by Churches and Qualified Church-Controlled Organizations Electing Exemption from Employer Social Security and Medicare Taxes. See IRM 3.13.12, Campus Document Services - Exempt Organization Account Numbers

  33. Transaction Codes 090 through 097: are used when processing Form 2553, Election by a Small Business Corporation. See IRM 3.13.2.22.

  34. Transaction Codes 098 and 099: are used when processing Forms 56, Notice Concerning Fiduciary Relationship. See IRM 3.13.2.18.

3.13.2.6.3.2.1  (01-01-2014)
CC ENREQ "R" /BRCHG

  1. CC BRCHG is restricted to Entity. Listed below are the transactions used by Entity for this CC.

  2. Transaction Code 011: is used to consolidate two EINs. See IRM 3.13.2.13.

  3. Transaction Code 053: identifies a change to accounting period as a result of an approved Form 1128, Application to Adopt, Change, or Retain a Tax Year. See IRM 3.13.2.20 .

  4. Transaction Code 054: identifies an approved FYM under Rev. Proc. 2006–46. See IRM 3.13.2.20.5 . TC 054 also represents an approved Form 8716 for a Personal Service Corporation.

  5. Transaction Code 055: identifies an approved FYM under IRC Section 444 on Form 8716, Election To Have a Tax Year Other Than a Required Tax Year. See IRM 3.13.2.21.

  6. Transaction Code 058: identifies a denied Form 8716. See IRM 3.13.2.21.3 (1).

  7. Transaction Code 059: identifies a denied Form 1128. See IRM 3.13.2.20.9 (1).

3.13.2.6.3.3  (01-01-2015)
CCs LPAGE/LPAGD/LETER/LREVW

  1. These command codes are used to send and delete letters from IDRS.

  2. CC LPAGE initiates CC LETER which composes and sends the letter. This is the second step in building a letter. Enter all the information needed to generate a taxpayer letter, including the Salutation, Selective Paragraph codes, Signature Title code, and fill-in content. CC LPAGE must be preceded by one of the following — CC LETER, CC ADJ54, CC DOALL, CC EPLET, CC LREVW, CC NOREF, CC IAPND, CC IAREV, CC IAORG, or CC QRACN. CC LPAGE checks the complete letter request for validity and consistency with the Form Letter being requested. If valid, the command code accesses the CAF and Reporting Agents File (RAF) in order to generate additional copies of the letter with authorized representatives' names and addresses. If the letter to the taxpayer will close a case, you may enter a Control-Sequence-Number on the CC LPAGE screen, and when the letter goes out, we will close that control base.

  3. See Exhibit 2.4.6-2 for screen display. Upon termination of a successful CC LPAGE request, the TIN, MFT code, tax period, and plan number, if any, will be "unprotected" again, so that the user will be able to input data or type over these fields for their next IDRS transaction. For July 2006, LPAGE will check the letter pending database to see if there was an earlier letter input. If so, it will put out a message to use definer 'S' if the user wants to create a duplicate letter. At the end of a successful request, LPAGE will update this same database using input operator's employee number as the key.

  4. CC LPAGD deletes a letter sent the same day of Realtime processing. The same employee who input the original letter must input the LPAGD using the same TIN, MFT-CODE, Tax Period, Plan Number, and Form Letter Number. All these fields, including the input Employee Number must match or the letter request will not be deleted, and a taxpayer letter will be generated.

  5. This is another tool to improve the quality of outgoing correspondence. To use CC LREVW, set the "View" indicator on the CC LPAGE screen to "Y" and transmit. CC LREVW will be automatically executed for you. CC LREVW combines the Selective paragraph codes, fill-in content, and other optional entries you made on the LPAGE screen with the form letter you selected from the Master Letter File. The program operates like the end-of-day program, CRX03, and formats the letter with headings, salutations, 70 character print lines, and even page breaks identical to those used on the final letter. However, where CRX03 prints the letter on paper, CC LREVW will do it on your terminal screen. Your fill-ins will be highlighted with inverse video, so you will easily be able to see if you made any errors. The paragraphs you selected will be printed out completely. You can even see the name and title of the person you selected with your Signature Title code. After you have reviewed your letter, return to page one and make any corrections. When you are satisfied with your letter, set the "View" indicator to "N" and transmit CC LPAGE to send your letter.

3.13.2.6.3.4  (01-01-2015)
CCs LLIST and LLIST'D'

  1. CC LLIST can be used to research whether a letter was input earlier in the day. Simply enter LLIST and the program will find all LPAGE records using employee number. If there is more than one screen, 'PAGE' will be used for display purposes. If the TIN/MFT/TAX PERIOD are entered, then only the LPAGE records for that one account will show. A search may also be done based on employee number. The order of the list will be 'LIFO' - last in first out.

  2. LLIST with definer 'D' can be used to delete individual LPAGE records. This command code should only be used after LLIST and only for deletes. You may delete more than one record on the same screen.

    • The cursor must be below the record you are deleting and above the PAGE prompt;

    • You cannot delete multiple records that are on different screens;

    • Keep in mind, this is no different than using LPAGD. Deletes should not be done for letters created prior to the GENDATA swap and deletes done after the swap will go on the next day's Quality Review matches; and

    • Any deletes on duplicates will begin with the last one input and will delete all earlier versions.

3.13.2.6.3.5  (01-01-2014)
CCs TELEA/TELEC/TELED/TELER

  1. Taxpayer phone numbers can be displayed on the TIF (CC ENMOD).

  2. CCs TELEA, TELEC, and TELED are used to add, change, and/or delete a telephone number from the TIF.

  3. If an EIN does not have a phone number, CC TELEA can be used to add the phone number to the EIN. If the phone number on an EIN is incorrect, CCs TELEC or TELED can be used to correct the phone numbers.

  4. If the EIN does not come up on CC ENMOD, the taxpayer's telephone number(s) can be viewed via CC TELER.

  5. See IRM 2.4.29, IDRS Terminal Input - Command Codes TELEA, TELEC, TELED and TELER for Telephone Processing.

3.13.2.6.3.6  (01-01-2015)
CC REQ54/ADJ54

  1. These command codes are used to make adjustments to tax, penalty, and interest.

  2. BMF Entity use these command codes to create a DLN that allows other documents to be attached to electronic DLNs.

  3. See IRM 2.4.16, Command Codes REQ54 and ADJ54 and IDRS Command Code Job Aid for CC REQ54.

3.13.2.6.4  (01-01-2015)
CC TMSSN

  1. This command code is used to assign Internal Revenue Service Numbers (IRSNs), also known as Temporary SSNs.

  2. IRSNs are utilized when a taxpayer's SSN cannot be located and a return or payment must be processed.

  3. BMF Entity primarily uses IRSNs when processing Estate and Gift (E&G) returns, Form 706 and Form 709 families, and Form 8288. IRSNs are also used when processing INVALID SSN TRANSCRIPTS, see IRM 3.13.2.19.1.

  4. CC TMSSN has two definers: "I" and "B." These indicators stand for IMF and BMF respectively.

  5. See IRM 2.4.59, IDRS Terminal input - Command Code TMSSN.

  6. Currently there is a problem processing Form 8288, U.S. Withholding Tax Return for Disposition by Foreign Persons of U.S. Real Property Interests. When a request is received for an IRSN, process within required time frame.

3.13.2.6.4.1  (01-01-2015)
Internal Revenue Service Numbers (IRSNs)

  1. BMF Entity uses Internal Revenue Service Numbers (IRSNs) for processing documents/payments when an SSN cannot be located. IRSNs are also called "Temporary SSNs."

  2. IMF Entity uses IRSNs for non-citizen filers and Identity Theft cases.

  3. An IDRS Command Code (CC) was created for the purpose of assigning IRSNs: CC TMSSN.

  4. IRSNs are the same format as an SSN (XXX-XX-XXXX), however, IRSNs will always begin with "9" .

  5. IRSNs will always be on the invalid segment, "W" , for example, XXX-XX-XXXXW.

  6. The fourth and fifth digits signify the campus that assigned the IRSN. See the chart below for details:

    Campus 4th and 5th Digits Expansion Ranges
    Andover 08 38
    Atlanta 07 37
    Austin 18 06
    Brookhaven 19  
    Cincinnati 17 02
    Fresno 89 10
    Kansas City 09 39
    Memphis 49  
    Ogden 29 04
    Philadelphia 28 05
    International 66  
  7. Currently, IRSNs are assigned in Austin, Cincinnati, Fresno, Kansas City, and Ogden. Each campus has the ability to assign an International IRSN.

3.13.2.7  (01-01-2015)
Unprocessable Returns and Documents/Rejects

  1. Background—In order for a return or payment to be processable, it must have

    • A valid TIN;

    • A legible name or name control;

    • A valid tax year ending; and

    • Legible tax data.


    Note:

    Edit the name control and/or tax period if not previously edited. Current year calendar annual returns should not have a tax period coded. Tax periods are edited in YYMM format.

  2. Returns and payments not meeting the requirements to be processable are considered unprocessable. Returns and payments that are unprocessable will be received from:

    • Receipt and Control (Under BBTS Control) - A tax examiner from Entity will go to Receipt and Control (Deposit Activity) daily to assign EINs to returns with remittances or remittances with no return or document attached. This is to avoid sending the money to unidentified. A local Customer Service Agreement (CSA) may be developed to allow expeditious processing of payments.

    • Document Perfection/Code & Edit (Unnumbered returns); and

    • Reject function (ERS Suspense).

    Note:

    For Payments/documents received from Rejects (ERS Suspense), research the Remittance Transaction Research (RTR) database and leave audit trail on RTR. See IRM 3.5.10, Remittance Transaction Research (RTR) System.

  3. Electronic returns and payments from Rejects are researchable via the Remittance Transaction Research (RTR) database. Entity will perform IDRS research to ensure taxpayer is using correct EIN and name.

    • EINs should initially be researched on IDRS with CCs ENMOD, BMFOL (definers 'E,' 'I,' 'T,' and 'R'), INOLE (definers 'G,' 'S,' and 'T') and FINDE/FINDS (definer 'D'). Compare TIN on Form 8161/voucher with TIN on Master File (MF). Utilize CCs SUMRY, TXMOD, and UPTIN to ensure TIN is correct. Names will be researched via CCs NAMEE, NAMEB, NAMEI, and NAMES

    • If EIN is not on Master File and has a prefix of 20, 26, 27, 45, 46, or 47 indicating it was assigned by Modernized Internet EIN (MOD IEIN), utilize CC ESIGN to issue a new EIN , using appropriate Notice Information Code.

    • If EIN is not on Master File and is not a MOD IEIN, but can be verified with CCs NAMEE, NAMEB, NAMEI, FINDE, or FINDS, input TC 000 with CC BNCHG entering correct FRCs, X-REF TIN fields, etc.

    • If an EIN cannot be located and the check does not contain enough information to assign an EIN, it will be considered "Unprocessable." If the check contains enough information to assign an EIN, ESIGN using NIC "D" . Send 147C requesting a completed Form SS-4.

    • If a valid EIN is found, utilize CCs BMFOL, IMFOL, TXMOD, SUMRY, and UPTIN to ensure FRCs and FYM are correct.

    • Edit Form 8161/voucher by circling out incorrect information such as name control and/or EIN. Write correct information and underline in appropriate field of Form 8161. If payment is unprocessable, enter such in Field 7 of Form 8161. Edit in Tax Period and MFT or "unprocessable" in Field (14) of Form 8161. Enter audit trail as shown in IRM 3.13.2.7.2, with TE number and date.

    • Enter history item with the "Add a Note" feature of RTR including corrected information or "Unprocessable."

  4. If received at the incorrect campus, returns/documents belonging to specialty/centralized programs will be transhipped to the correct campus. Excise returns will be transhipped to Cincinnati no matter where they are received. Exempt Organization returns will be transhipped to Ogden regardless of the campus receiving the return first. International returns are processed in Ogden with the exception of Estate and Gift (Forms 706/709 series) which are processed in Cincinnati. Documents received with an address outside the campus jurisdiction will be processed at the campus received. For example, if a California taxpayer submits his Form 2553 to Cincinnati, it will be processed in Cincinnati. If an Ohio taxpayer submits his Form 8716 to Ogden, it will be processed in Ogden.

  5. See IRM 3.30.123, Processing Timeliness Cycles, Criteria, and Critical Dates, for Entity Control's processing time frames for unprocessable returns.

  6. All BMF returns and documents must be controlled for accountability. The Batch Profile Report is used to control and identify cases in Entity Control.

  7. Take the following actions regarding an "address change box" on the return:

    If... And... Then...
    a) The address change box on the return is checked, The return is signed by the taxpayer or an authorized representative, Update Master File to reflect the address on the return.
    b) The address change box is not checked, The return has an address different than what is on Master File, Do not change the address on Master File. Send appropriate letter to the taxpayer at the address on the return and advise the taxpayer of the address discrepancy. Direct the taxpayer to www.irs.gov for Form 8822-B. If a specific letter is not needed notify TP of the address discrepancy with a 104C/6800sce.
    c) The return does not have an address change box, The address is different than what is on Master File, Do not change the address on Master File. Send appropriate letter to the taxpayer at the address on the return and advise the taxpayer of the address discrepancy. Direct the taxpayer to www.irs.gov for Form 8822-B. If a specific letter is not needed notify TP of the address discrepancy with a 104C/6800sce.
    d) A PO Box is indicated with a physical address   Input the physical address as the location and the PO Box as the mailing address.
  8. When making any address change from a return, the following information will be entered in the Remarks field of CC BNCHG:

    • MFT of return,

    • Tax Period of Return,

    • Name and title of signature,

    • Telephone number (if available)

    Note:

    If the signature is illegible, enter "SIGNATURE ILLEGIBLE" in Remarks field of the transaction.

  9. If you are processing a return with a Name Change box and it is marked, update Master File to reflect the name entered on the return after verifying the name change with Secretary of State office. Edit and underline the name control from Master File in the primary name line field of the return. Correspond with taxpayer asking for verification of the name change. Ask taxpayer to include a copy of any amendment documents pertaining to name change when responding to us.

    Exception:

    Trusts. The name entered on trust returns will vary depending on the person completing the return. When evaluating if a TC 013 should be input, compare the dates the trust was created/funded on Master File and the dates entered on the return.
    Also, Form 1041 now has boxes for changes in trust name, fiduciary, fiduciary's name, and fiduciary's address. If any of these boxes are marked, input the change requested by the box. Do not write the Taxpayer asking for documentation!

  10. Copies of page 1 of returns and documents that indicate a change in name or an address for EO accounts will be received from:

    • Receipt and Control Operation (RCO),

    • Document Perfection/Code & Edit (DPO/C&E),

    • Reject function (ERS Suspense).

  11. For processing copies or originals of EO returns or documents , see IRM 3.13.12, Campus Document Services - Exempt Organization Account Numbers.

  12. BMF returns will be placed on the error register when the input name control does not match the name control on the Entity Index File (EIF).

    1. Error Resolution/Rejects will perform research to determine if the taxpayer is using the correct EIN.

    2. If Error Resolution/Rejects determines that the EIN is for the same taxpayer, but the BMF is not name controlled properly, a copy of the first page of the return and any research will be forwarded to Entity Control.

  13. Process the photocopy of the return as follows:
    Compare the way the taxpayer shows his/her name on the return with the name as shown on the BMF,

    If... Then...
    a) The name control on the BMF is not according to acceptable name control procedures, Input the correct name control to update the BMF.
    b) The business name is not identified on the BMF as a sort name, Input the sort name in the sort name field to correct the BMF.
    c) There are misspelled names on the BMF, Input the changes in the correct name line fields to correct the BMF.
    d) It is obvious the BMF is correct, Destroy the photocopy of the return and take no action.
    e) A PO Box is indicated with a mailing address, Input the mailing address as the location and the PO Box as the mailing address.
  14. Copies of prior year Form 941-E for taxpayers with EC "G" and Social Security tax indicated may be sent to Entity for filing requirement determination. Contact the state administrator to determine if the entity are covered under Section 218. If they are covered under Section 218, update the account to reflect EC "T" and a Form 941-01 filing requirement code. If they are not covered under Section 218, return the case to Code and Edit to be processed as a Form 941.

  15. Returns with no entity data, (no name, EIN, SSN) may be forwarded to Entity from Receipt and Control.

    1. Review the form for a legible name on the signature line, schedules, or any attached correspondence.

    2. If possible locate a valid telephone number for the name secured. Contact the taxpayer, and if sufficient information is provided, perfect the return and continue processing.

    3. If a state unemployment reporting number is present in the body of the return, the state unemployment agency may be contacted for the entity information.

      Note:

      IRS may disclose return information for the purpose of obtaining information not otherwise reasonably available.

    4. Every available option to perfect the return will be utilized, including contacting the taxpayer by phone.

    5. If the return cannot be identified in any manner, see your manager for disposition of the form.

  16. Form 1120S filed under Internal Revenue Code 1377 (termination of a shareholder) will be sent to Entity Control for verification of "S" corporation termination.

    1. Review the return to verify the termination is for that shareholder only and the "S" corporation has not been terminated.

    2. If the "S" corporation is terminated use normal procedures for an "S" corporation termination.

    3. If the termination is for that shareholder only, contact the taxpayer who filed the Form 1120S. Let them know that a separate return is not required to terminate a shareholder and they should file Schedules K–1 for their terminated shareholders with Form 1120S at the end of their normal tax year. Also inform them that the Form 1120S that was filed is being returned.

    4. Notate on Form 4227 "Return to taxpayer" and send to the Reject function to void the DLN and return to the taxpayer.

  17. Modernized e-File (MeF) will refer cases to Entity via ERS Action Code 321. The Employee User Portal (EUP) will be accessed to verify Entity information. Any needed Entity transactions will be input by Entity TEs to ensure the taxpayer's information on Master File is current and correct.

  18. Forms 7004 or 1120 with a subsidiary listing (Form 851) will be sent to Entity by Code and Edit for verification of the subsidiary names, tax period and EIN. However, Code and Edit must research using CCs INOLE or BMFOL before the case is sent to the Entity function. If Code and Edit has not researched the subsidiary name, tax period and EIN, return the case(s) to the Code and Edit function.

    If... Then...
    a) The parent corporation's EIN is not on BMF and you cannot locate a valid number via research, Use CC ESIGN to assign a new number.
    b) The subsidiary's EIN is not on BMF and you cannot locate a valid number via research, Inform originating office not to enter the TC 590 - CC 014.
    c) The subsidiary has changed their name, Edit the name control from Master File onto Form 851. Send 252C requesting name verification.
    d) Code and Edit has requested a change, Update the module with the change.
    e) The FYM is the same as the parent, Input TC 590-014 for tax period of return.
    f) The FYM is different, Change it to match the parent's FYM and input TC 590-014 for tax period of return.
    g) Research indicates the subsidiary information has already been updated and the parent's EIN is on the BMF, Take no further action.
    h) The subsidiary is an LLC (or partnership) without a TC 076, Do not change or add FRCs. Correspond with the taxpayer requesting a valid Form 8832.
    i) If an entity shown on Form 851 is a QSub, Do not terminate the Subchapter S election. Send 3064C to QSub asking if election has been terminated.

    Note:

    The TC 590-014 should be input for the tax period of the return being processed.

  19. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

  20. When processing returns and a letter must be sent, ensure the correct MFT and tax period are entered into CC LPAGE. If a letter has been sent within the last 30 days on the same MFT and tax period, do not duplicate letters.

  21. Entities have the ability to convert to a trust for liquidation purposes. If Form 1041 is received indicating the entity has converted to a trust, update the EIN to reflect the correct name and FRC.

  22. Always use prefix 66 when ESIGNing an EIN to a taxpayer located in American Samoa, Federated States of Micronesia, Guam, Northern Mariana Islands, Palau, Puerto Rico and Virgin Islands. See IRM 21.7.13.7.3.8.3.2. CC CMODE will be utilized.

  23. Always use prefix 98 when ESIGNing an EIN to a taxpayer with an international/foreign location address. If return does not have mailing and location addresses and mailing address is international/foreign, assign prefix 98. CC CMODE is used for EIN prefix 98. See IRM 21.7.13.3.2.7(5) for more information.

3.13.2.7.1  (01-01-2015)
Statute Dates

  1. This section contains information on Statute Dates. If the Assessment Statute Date is imminent (two months prior to the ASED) notify the manager or work leader and initiate the necessary action to resolve the case.

  2. The ASED is identified by Generalized Unpostable Framework (GUF) and must be monitored to assure that statute does not expire.

  3. The ASED is generally determined as three years after the Return Due Date (RDD) or IRS received date, whichever is later. See Document 6209 , IRS Processing Codes and Information, for RDD information.

    Note:

    A return under statute criteria must be statute cleared every 90 days until posted.

  4. Example of statute for a timely filed return:

    Form Tax Period IRS Received Return Due Date Statute Date
    1040 201312 3-15-2014 4-15-2014 4-15-2017
    1120 201407 9-10-2014 10-15-2014 10-15-2017
    941 201403 4-20-2014 4-30-2014 4-15-2018
    720 201306 6-20-2013 7-31-2013 7-31-2016
  5. Example of statute for a late filed return.

    Form Tax Period IRS Received Return Due Date Statute Date
    1040 201312 5-15-2014 4-15-2014 5-15-2017
    1065 201312 8-3-2014 4-15-2014 8-3-2017
    990 201304 9-30-2014 9-15-2014 9-30-2017

3.13.2.7.2  (01-01-2015)
Processing BMF Returns

  1. The following instructions are to be used when processing returns and documents with:

    • Missing or invalid EINs,

    • Change in ownership,

    • Multiple EINs,

    • Form SS–4 attached,

    • An address on the return that does not match IDRS

    • Indications of Bankruptcy/Receivership

  2. Research must be performed in all cases using CCs NAMEE and NAMEB.

  3. If research locates an EIN on CC NAMEE, the entity must be verified by using CC ENMOD, INOLE and BMFOL.

  4. Enter the EIN on the return or document and underline the name control. Circle out the invalid EIN if present. Notify the taxpayer of the correct EIN. If the taxpayer submits an EIN clearly changed from the one the taxpayer was assigned, issue letter 147C as a non-suspense letter, see (7) below. If the taxpayer makes an error in writing his/her EIN by three or less digits, uses his/her SSN (specifically on Form 2290) or fails to include the EIN, do not correspond after research reveals a valid EIN. However, if this return is the first return filed (check CC BMFOL'I'), notify the taxpayer of their correct EIN.

    1. If the EIN located is correct on the BMF Master File Indicator (MFI) "P" and no module on the BMF MFI "B" TC 000 the account on Master File "B" tape (Intend indicator 1 to create a dummy module). Enter the EIN on the return or document, underline the name control, and release for processing.

    2. If the EIN located is correct but not on the BMF , use CC BNCHG with TC 000 (intend indicator of 1) to place the account on the BMF. Enter the EIN on the return or document and underline the name control. Release the return.

  5. If an EIN is not located, assign a new EIN with CC ESIGN using the appropriate Notice Information Code (NIC). Enter the Business Operation Date (BO) shown on the return. If no date is given use the first day of the beginning of the tax period. Enter the Wages Paid Date (WP) for Form 941, Form 943, Form 944, and Form 940. Determine the date as follows:

    • If a Form 941 the WP is the first day of the quarter;

    • If a household employer contact the taxpayer, if possible, to determine the date wages were first paid. If unable to contact the taxpayer use the date
      of 01–01–YY (the year of the return),

    • If a Form 943 the WP is the first day of the year; or

    • If a Form 940 contact the taxpayer using the telephone for the date wages were first paid. If available, use Form 940, Part III to determine the WP date. If unable to locate the taxpayer use the first day of the current quarter.


    Enter the new EIN on the return or document and underline the name control.
    See below for the NICs and the notice generated by each.

    If Use NIC To generate CP
    The EIN is being assigned to a return/document for which no other valid EIN can be found A CP 576
    The EIN is being assigned to a return/document which indicates there is a change in the business organization (for example, a sole proprietor to a corporation) which requires a new EIN B CP 577
    Notice and prior period analysis is to be suppressed D

    Note:

    This will also suppress TC 474 and TC 590.

    None
    EPMF EIN established for Plan Sponsor from Form SS-4 F CP 580
    The EPMF EIN assigned from Form SS-4 G CP 582
    EIN for Employee Benefit Trust assigned via the EIN Toll-Free Telephone Service H CP 583
    The EPMF EIN assigned via the EIN Toll-Free Telephone Service for Plan Sponsor F CP 580
    The EPMF EIN assigned via the EIN Toll-Free Telephone Service L CP 582
    The EPMF EIN assigned from Form 5500 family P CP 581
    Form SS-4 received with a return/document R CP 575

    Note:

    The use of a Return Identity Code (RIC) from the chart below is mandatory.

    Return/Doc RIC   Return/Doc RIC   Return/Doc RIC
    11-C 63   3672 72   8288 18
    CT-1 09   4461 61   8716 87
    1040-NR N2   4461-A 62   8868 E8
    1041 05   5227 37   8871 PL
    1041-A 36   5300 53   8872 PL
    1042 12   5301 50   940 10
    1065 06   5302 52   940-EZ Z1
    1065-B 06   5303 58   941 01
    1066 66   5304 54   943 11
    1120 02   5306 56   943-SS S1
    1120-F F1   5307 57   944 14
    1120-H H2   5309 59   945 JN
    1120-L L1   5310 55   990 67
    1120-M M1   5330 35   990-BL 56
    1120-ND N1   5500 74   990-EZ Z6
    1120-PC P3   5500-C 7C   990-PF 44
    1120-POL P1   5500-EZ 7E   990-T 34
    1120-REIT R2   5500-R 7R   Household Employees ZZ
    1120-RIC R1   7004 E2   8038 46
    1120-SF S3   706-GS(D) D6   3520-A 42
    2553 53   706-GS(T) T6   SGRI SG
    3520 68   720 03      
          730 64      

    Note:

    If a RIC is not listed for the Return/Document, NIC "D" will be used. Send 147C requesting taxpayer to complete and return Form SS-4

    .

  6. Use the chart below to determine the Filing Requirement (FR):

    If... Then...
    a) The filer is a Form 941 filer, Enter a Form 940 FRC also
    b) The name is a corporation or Inc, Enter a Form 1120 FRC
    c) The name is a partnership, Enter a Form 1065 FRC
    d) The name is an estate, Enter a Form 1041 FRC
    e) The name contains words such as mortgage, investors, mortgage securities, asset followed by the word trust, Enter a Form 1066 FRC
    f) The above words are not present with the word "trust, " Enter a Form 1041 FRC
    g) The unprocessable return is for a Form 730, Enter a Form 11-C FRC
    h) The unprocessable return or document is a Form 1041, or Form 1065, or Form 1120, Enter the appropriate filing requirement and enter the FYM on the return
  7. If a return or document indicates a change in ownership, the research is performed on the new entity.

    • Enter the new EIN and name control on the unprocessable return or document, circle out the old EIN, name control (and/or check digit) of the former owner. Release the return.

    • If it can be determined that the original owner filed a return for the final period but it posted without condition code "F," input a TC 591, CC 020 on the next tax period to indicate the original owner is no longer liable for this type of tax.

    • If a final return has not posted correspond with the original owner using Letter 696C requesting a "Final" return.

  8. Multiple EINs

    • If multiple EINs are present, verify using CCs NAMEE, NAMEB, or INOLE.

    • The most active EIN on the module is the taxpayer's EIN.

    • If they are the same taxpayer, process using the consolidating accounts procedures.

    • If they are not the same taxpayer, determine the correct EIN for the name on the return and process according to (3) and (4) above.

  9. Return received with a Form SS–4 attached:

    • Process the Form SS–4 per instructions in IRM 21.7.13

    • Use NTC-CD> R , the correct RIC and tax period ending.

    • Annotate the new EIN on the return and underline the name control.

    • Release the return for processing.

  10. Returns received with a Form SS-4 attached and the account has already been established on the Master File:

    • If the Notice Code (NTC-CD>) on ENMOD is A or B, this indicates that a new EIN was assigned from a return/payment and a notice was sent to the taxpayer requesting completion of a Form SS-4 (See Figure 3.13.2-12).

    • To keep a second notice from being sent to the taxpayer, an ESIGN'U' transaction must be entered by the following steps:

    • Bring up the account on ENMOD.

    • Input ESIGN'U' and transmit.

    Figure 3.13.2-12

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  11. Before releasing the return for processing, an audit trail containing the TEs IDRS number must be entered in the lower left corner of the return. The following applicable format will be used:

    • EIN 'F' MMDDYYYY (used when TE finds the taxpayer's valid EIN)

    • EIN 'E' MMDDYYYY (used when TE must assign a new EIN to the taxpayer)

    • EIN 'OK' MMDDYYYY (used when correct EIN was already entered on the return)


    This is the "Return Processable Date" . This is the date the return became processable for purposes of calculating penalties and interest.

  12. If the return contains indication that it is for a bankruptcy or receivership, refer to IRM 3.13.2.9.18 (1).

  13. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  14. If the returns/documents are numbered, they must be in DLN order, as shown on the transmittal, before releasing.

  15. Do not input TC 599 if the return is annotated with "3177" , TC 59X, is an amended return (CCC "G" ), RPS return, Rejected return, unpostable return, or was secured by Examination. (Refer to the campus PCD calendar, available from your assigned Planning & Analysis (P&A) staff analyst.)

  16. If the Program Completion Date (PCD) for the return is impending or the return was due in the past four weeks, input TC 599 CC 18 for the tax period on the return and annotate "TC 599" in the left margin of the return.

    Figure 3.13.2-13

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3.13.2.7.3  (01-01-2015)
Form 940/ 941 SCRPS

  1. Entity is responsible for editing entity changes on all SCRPS Forms 940/941. Entity will do the following when editing Forms 940/941 for SCRPS:

  2. A green pen will be used to edit the entity information

  3. Edit an asterisk (*) to the left (as close to the entry as possible) of the incorrect EIN and/or name control. This will prompt the system to stop on the indicated field.

  4. Line through the incorrect information.

3.13.2.7.4  (01-01-2015)
Forms 941, 943, 944, 945 and 940 - Employment Returns

  1. Form 941, Employer's Quarterly Federal Tax Return
    See Figure 3.13.2-14.
    Use Pub 15, Employer’s Tax Guide (Circular E), for resolving questions concerning Employer's Tax for Form 941, Form 940, Form 944 and Form 945.

    1. This return is filed by taxpayers with employees. Services performed by a son/daughter age 18 or older are taxable for social security and Medicare purposes.

    2. Services performed by a spouse are taxable for social security and Medicare purposes.

    3. Cash tips are wages and are subject to social security and Medicare tax. A separate line has been retained on the return for this item.

    4. The return is filed to report withheld income tax and social security and Medicare taxes.

    5. The return is filed on paper Forms 941 or e-file.

    6. The return is filed four times a year, with the tax period ending on the following dates and the return due accordingly:
      March 31 and the return due on April 30.
      June 30 and the return due on July 31.
      September 30 and the return due on October 31.
      December 31 and the return due on January 31.

      Exception:

      Intermittent filer

    Figure 3.13.2-14

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  2. Form 943 - Employer's Annual Tax Return for Agricultural Employees
    Use Pub 51, Agricultural Employer’s Tax Guide (Circular A), for resolving questions concerning agricultural employers. See Figure 3.13.2–15. This return is filed by Employers of Farm workers. A farm worker is an employee of the operator of a farm who:

    1. Raises or harvests agricultural or horticultural products; or Cares for the farm and equipment; or

    2. Handles, processes, or packages any agricultural or horticultural commodity, if over half is produced on the farm; or

    3. Does work related to cotton ginning, turpentine, or gum resin products; or


    Definition of Farm—includes stock, dairy, poultry, fruit, fur-bearing, animal and truck farms, orchards, plantations, ranches, nurseries, ranges and green houses or other similar structures used mainly for raising agricultural or horticultural commodities.
    Form 943 is filed to report federal income tax withheld and FICA taxes. The employer must withhold federal income tax from the cash wages it pays its farm-workers if the cash wages are subject to social security and Medicare taxes. Although non-cash wages are subject to federal income tax, an employer may withhold federal income tax only when the employer and its employee agree to do so.
    Paper Forms 943 are filed once a year with the tax period ending on December 31st and the return due on January 31st. If an employer makes deposits on time in full payment of the taxes due for the year, the return is due February 10.

    Note:

    Forestry and lumbering are not "Farm work" unless the products are for use in the employers farming operations.

    Figure 3.13.2-15

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  3. Form 940 - Employer's Annual Federal Unemployment (FUTA) Tax Return

    1. This return is filed by employers that have employees and are subject to Federal Unemployment tax.

    2. Non-agricultural and non-household employers are required to file this return if during this year or last year either paid wages of $1,500 or more in any calendar quarter or he had one or more employees for at least some part of a day in any 20 or more different calendar weeks.

    3. An Agricultural Employer files this return if during this year or last year they either paid cash wages of $20,000 or more in any calendar quarter; or employed 10 or more farm workers during some part of a day during any 20 different weeks.

    4. A household employer is not required to report unemployment taxes on Form 940. DO NOT ESTABLISH A FORM 940 FOR HOUSEHOLD EMPLOYERS. Household employers report wages paid on Schedule H (Form 1040).

      Exception:

      State and local government health and welfare agencies, who assume responsibility for reporting and paying FICA and FUTA taxes and any withheld income tax with respect to individuals furnished by the agency to provide domestic services (home care workers) for recipients of public assistance must obtain a separate EIN to report these taxes.

    5. The return is filed once a year with the tax period ending on December 31st and the return is due on January 31st. If the taxpayer deposits all FUTA tax when due, the taxpayer may file on or before February 10th. See Figure 3.13.2–16.

    Figure 3.13.2-16

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  4. Form 944 - Employer’s Annual Federal Tax Return . Form 944 is filed annually by certain small employers to report and pay employment taxes. Taxpayers who apply for an EIN via phone, mail, internet, or fax are assigned a Form 944 FRC based on a "yes" response to Form SS-4, Item 14. Effective 1-1-10, participation in the Form 944 project became voluntary. However, to "opt out" a taxpayer must call the IRS at 1-800-829-4933 or 267-941-1000 (toll call) between January 1 and April 1 or send a written request postmarked between January 1 and March 17..

    If... Then...
    a) The taxpayer is filing Form 944 and there is no FRC for Forms 944 and 941 Establish a Form 944 FRC if the wages are under $4,000 annually
    b) The taxpayer is filing Form 944 and they qualify for a Form 944 FRC and the Form 941 FRC is present

    Note:

    Exercise caution when changing the FRC from 941 to 944. Form 944 is an annual return so the taxpayer could have filed Forms 941 and a 944. See Figure 3.13.2–17

    Delete the Form 941 FRC and establish a Form 944 FRC if the wages are under $4,000 annually.
    c) The taxpayer has a Form 944 FRC and the taxpayer did not opt out of the Form 944 program by April 1st. Entity cannot change the FRC unless IRS made an error. The taxpayer must file Form 944. Example: Taxpayer is notified in Feb. 2013 that he is now a Form 944 filer. Taxpayer files Form 944 in Jan. 2014 for the 2013 tax year showing liability of more than $1,000. Taxpayer's Form 944 will be processed regardless of the liability amount.

    Note:

    If the taxpayer has a Form 944 FRC and did not opt out by April 1st and files Form 941, the Form 941 will unpost. The taxpayer must be notified that he must file Form 944 (regardless of the liability amount)

    d) The Form 944 shows a tax liability of more than $1,000 and has a Form 944 FRC Taxpayer must file Form 944 (unless they "opt out" before April 1st of the tax year)

    Note:

    Once the Form 944 posts, the taxpayer will receive a letter stating that he exceeded the threshold and must file Form 941 for the next tax year.

    Figure 3.13.2-17

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  5. Form 945 - Annual Return of Withheld Federal Income Tax

    1. Form 945 is a multi-use form. The taxpayer may file it to report federal income tax withheld from non-payroll payments such as pensions, annuities, IRAs, gambling winnings, Indian gaming profits and backup withholding.

    2. The return is due January 31.

    3. Form 945 posts to the BMF

    4. Taxpayers can request a separate EIN for the pension income, however, it is not a requirement. Separate branches within a company may want a different EIN for internal purposes.

    5. When the taxpayer provides the name of a plan on the Form 945, it indicates that the filing is for withholding on a pension plan. The taxpayer may use either their business EIN or their plan trust EIN for filing Form 945 in this case. The taxpayer may choose to switch between using a plan trust EIN and the business EIN each year.

    6. Primary Name Line - A business EIN will never have wording such as "PROFIT SHARING PLAN" . A plan trust EIN will always have wording such as "PROFIT SHARING PLAN" .

    7. Sort Name Line - A business EIN will never have "ACCOUNT UNDER TEFRA" in the sort name. A plan trust EIN will have "ACCOUNT UNDER TEFRA" in the sort name.

    8. Check BMFOL'I' or BMFOL'T' for MFT 16 to compare deposits when unsure where to post the return.

    9. A TC 011 (consolidation) will only be performed when two plan trust EINs were issued for the same plan trust. Never consolidate a plan trust EIN to a business EIN, even if the taxpayer indicates that they don’t want to use the plan trust EIN. These are two separate and distinct entities. Input a TC 591 CC 020 on the account that will no longer be filing the Form 945.

      Exception:

      If the plan trust EIN was assigned in error to process a return or payment, TC 011 must be done to consolidate the accounts.

    10. Processing Form 945. See Figure 3.13.2-18.

      If... And... Then...
      a) The taxpayer uses their business EIN, The EIN is valid, Use the business EIN to process the return. Circle out any plan name wording on the Form 945 such as "PROFIT SHARING PLAN" .
      b) The taxpayer uses their plan trust EIN, The EIN is valid, Use the plan trust EIN to process the return.
      c) The plan trust EIN is no longer on Master File,   Research to verify the plan trust EIN.
      the EIN is valid, Re-establish the EIN via TC 000.
      a valid EIN is not found Assign a new EIN with the information provided
    11. If the EIN provided is not valid or there is no EIN on the form and:

    If... Then...
    a) The name provided is a business name,
    • Research using NAMEE for a business EIN,

    • If found, process the return using the business EIN,

    • If no valid EIN is found, re-establish the EIN with the info provided.

    b) The name provided is a pension plan trust type name,
    • Research using NAMEE for a plan trust EIN.

    • If a plan trust EIN is found, use this EIN to process the return.

    • If a plan trust EIN is not found and a business EIN is found, check BMFOL'I' for deposits to MFT 16. If the deposits match, post the return to the business EIN. Circle out any plan name wording on the 945 such as "PROFIT SHARING PLAN" .

    • If no plan trust or business EIN is found, establish an EIN via CC ESIGN as a plan trust.

    Figure 3.13.2-18

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3.13.2.7.5  (01-01-2015)
Form 1120 Series - Corporation Returns

  1. Entities that are incorporated under state law are considered corporations for Federal Tax purposes. A corporation must file one of the Forms 1120, unless it is an exempt organization. See Figure 3.13.2-19. Exempt organizations that are incorporated file one of the Forms 990 series returns.

  2. Foreign companies (including companies from Guam, Puerto Rico, Virgin Islands, and American Samoa) that incorporate within the United States will file Form 1120. If the foreign company is not incorporated in the United States, but does business in the United States (for example a branch office) it will file Form 1120-F.

  3. Use the beginning of the tax year (located at the top of Form 1120) as the Business Operational Date (BOD). If the date entered in the "Date Incorporated" box is during the year covered by the return, use that date as the BOD.

  4. Form 1120 (a domestic entity only) received from a Limited Liability Company (LLC) Limited Company (LC) must have a previously accepted Form 8832 (TC 076) on file. If the company has LP or LLP or LC after their business name, you are responsible for determining if the company is an LLC. You can research the entity module for a TC 076. Most Limited Liability Partnerships (LLPs) file Form 1065 for federal tax purposes, however there will be limited partnerships companies (LP) that will opt to file as a corporation for federal tax purposes. If you are undecided about the taxpayer being an LLC, contact the taxpayer.

    Figure 3.13.2-19

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  5. If Form 1128 is attached to Form 1120, see IRM 3.13.2.20 for Form 1128 processing procedures.

  6. The different types of Forms 1120 are as follows:

    • Form 1120, U.S. Corporation Income Tax Return.

    • Form 1120-C, U.S. Income Tax Return for Cooperative Associations.

    • Form 1120-F, U. S. Income Tax Return of a Foreign Corporation.

    • Form 1120–SF, U.S. Income Tax Return for Designated Settlement Funds (Under Section 468B).

    • Form 1120–FSC, U.S. Income Tax Return of a Foreign Sales Corporation.

    • Form 1120–H, U.S. Income Tax Return for Homeowners Associations.

    • Form 1120–IC–DISC, Interest Charge Domestic International Sales Corporation Return.

    • Form 1120L, U.S. Life Insurance Company Income Tax Return.

    • Form 1120–ND, Return for Nuclear Decommissioning Funds and Certain Related Persons.

    • Form 1120–PC, U.S. Property and Casualty Insurance Company Income Tax Return.

    • Form 1120–POL, U.S. Income Tax Return for Certain Political Organizations.

    • Form 1120–REIT, U.S. Income Tax Return for Real Estate Investment Trusts.

    • Form 1120–RIC, U.S. Income Tax Return for Regulated Investment Companies.

    • Form 1120S, U.S. Income Tax Return for an S Corporation.

  7. Corporation tax years can end any month of the year. A fiscal year ends January through November; a calendar year end is a December tax year end. A Subchapter S corporation, a personal service corporation and a life insurance company, must use the tax year of their owner (usually December 31) unless certain requirements are met. Once the fiscal year month (FYM) is determined (return filed), the taxpayer can only change their FYM by filing Form 1128.

  8. All corporate returns are posted to the BMF except Form 1120–IC–DISC which are Non Master File.

  9. Form 1120

    • Form 1120, U. S. Corporation Income Tax Return

    • This return is filed by domestic corporations that can be members of an affiliated group and be included in a consolidated return

    • Form 1120 is filed annually and the return is due on the 15th day of the third month after the end of the tax year

  10. Form 1120-C

    • This return is filed by cooperative associations.

    • It was created to replace Form 990-C beginning Jan. 1, 2007.

  11. Form 1120-F

    • Form 1120-F, U. S. Income tax Return of a Foreign Corporation

    • This return is filed annually and the return is generally due on the 15th day of the third month after the end of the tax year. For a foreign corporation with no office or place of business in the U.S., this return is due by the 15th day of the 6th month after the end of the tax year.

  12. Form 1120-SF

    • This return is filed by a corporation who establishes a fund for the principal purpose of settling and paying claims against the electing taxpayer under IRC Section 468B.

    • The return is filed annually and is due on the 15th day of the third month after the close of the fund's tax year.

    • The return must be on the same tax year as the electing taxpayer that created it.

  13. Form 1120-FSC

    • Forms 1120-FSC, U. S. Income Tax Return of a Foreign Sales Corporation, are filed at the Ogden Submission Processing Center.

    • Any election to be a foreign sales corporation made prior to Oct. 1, 2000, are now obsolete.

  14. Form 1120-H

    • This return is filed by homeowners associations. The filing of Form 1120-H is an election under IRC Section 528 and cannot be changed for the year of filing.

    • If the homeowners association does not elect to use Form 1120-H, it can file a Form 1120.

    • The homeowners association may file for tax exemption under IRC Section 501(c)(4) and will then file a Form 990.

    • The Form 1120-H is filed annually and the return is due on the 15th day of the 3rd month after the tax year ends.

  15. Form 1120-IC-DISC

    • This return is an information return filed by an interest charge domestic international sales corporation (DISC), a former DISC, and a former IC-DISC

    • The IC-DISC election is made by filing Form 4876-A, Election To Be Treated as an Interest Charge DISC.

    • The return is filed annually and is due on the 15th day of the ninth month after the tax year ends. No extensions are allowed.

  16. Form 1120-L

    • This return is filed by domestic life insurance companies and foreign corporations carrying on an insurance business within the U. S. that would qualify as life insurance companies if they were U. S. corporations.

    • A benevolent life insurance company of a local character of which 85% or more of the income consists of amounts collected from members for the sole purpose of meeting losses and expenses may file for a tax exemption under IRC Section 501(c)(12) and then will file Form 990. An exempt organization may be required to file a Form 1120-L when it meets certain criteria.

    • This return is filed annually and is due on the 15th day of the third month after the tax year ends.

  17. Form 1120-ND

    • This return is filed by nuclear decommissioning funds under IRC 468A to report contributions received, income earned, the administrative expenses of operating the fund, and the tax on the income earned.

    • The tax year must be the same as that of the creating public utility.

    • The return is filed annually and is due on the 15th day of the third month after the close of the tax year.

  18. Form 1120-PC

    • This return is filed by domestic non-life insurance companies and any foreign corporation that would qualify as a non-life insurance company subject to tax under IRC 831.

    • Certain small mutual and stock non-life insurance companies may file for a tax exemption under IRC 501(c)(15) and then will file Form 990. An exempt organization may be required to file a Form 1120-PC when it meets certain criteria.

    • This type of taxpayer can be a member of a controlled group and file a consolidated return.

    • Normally the return will be filed on a calendar year, but can be a fiscal filer if the parent is a fiscal filer.

    • The return is filed annually and the return is due on the 15th day of the third month after the tax year ends.

  19. Form 1120-POL Filed exclusively at Ogden Submission Processing Center (OSPC)

    • This return is filed by political organizations, that is, a party, committee, association, fund (including a separate segregated fund set up by IRC Section 501(c) tax exempt organizations), such as a political action committee. A political organization will also be required to file a Form 990.

    • A tax exempt organization will file both Forms 990 and 1120-POL.

    • The return is filed annually and is due on the 15th day of the third month after the tax year ends.

    • Use the individual's name as the name control:
      Committee to Elect Patrick Doe: Input name control as PATRICK DOE
      Committee to Elect Pat Doe: Input name control as PATDOE

  20. Form 1120-RIC

    • This return is filed to report the income, gains, losses, deductions, credits, and to figure the income tax liability of a Regulated Investment Company (RIC).

    • A Form 1120-RIC cannot be a member of a consolidated group.

    • Form 1120-RIC is an annual return required to be filed on the 15th day of the third month after the end of the RIC's taxable year.

  21. Form 1120-REIT

    • This return is filed to report the income, gains, losses, deductions, credits, and to figure the income tax liability of a Real Estate Investment Trust (REIT).

    • Any Entity that elects to be treated as an REIT (or has made a valid election for a prior tax year) and meets the requirements to be taxed as an REIT must file this return.

    • Once the election is made it remains in effect until terminated or revoked. An election terminates automatically for any year the entity is not a qualified REIT. An election can be revoked by the taxpayer by filing a statement with the campus by the 90th day after the first day of the tax year. In general, if an election terminates or is revoked, the entity may not re-elect to be taxed as an REIT until the 5th taxable year after the year the termination or revocation is effective.

    • The revoking correspondence must be held in Entity until the final Form 1120-REIT is filed. Do not suspend. Associate the correspondence with the final Form 1120-REIT. Ensure the return has CCC " F" .

    • An REIT cannot be a member of a consolidated return.

    • Form 1120-REIT is an annual return required to be filed by the 15th day of the third month after the end of the REIT's taxable year.

  22. Form 1120S

    • S corporations are domestic corporations in which the income/loss flows through to the owners/shareholders.

    • The corporation must make a Subchapter S election on a timely filed Form 2553. See IRM 3.13.2.22

    • This taxpayer cannot be a member of a controlled group of corporations.

    • Generally, an S corporation is exempt from federal income tax other than tax on certain capital gains and passive income.

    • This return is filed annually and is due by the 15th day of the third month after the close of the tax year.

    • The Tax Reform Act of 1986 required all S corporations to use the same tax year/FYM as their owner. There are certain provisions (Form 8716, Form 1128, Rev. Proc. 2006-46) whereby an S corporation can use a fiscal tax year. This will be denoted by a TC 054 or TC 055 on the Entity module.

    • If an EIN must be assigned to a Form 1120S, NIC "D" will be input. Send 147C to the taxpayer to notify them of the EIN assignment, asking them to complete and return a Form SS-4. Also tell the taxpayer that they will be contacted separately regarding their Form 2553.

    • If a valid Form 1120S is received in Entity because the current FRC on IDRS is 1120-01, check for an unreversed TC 090. If found, delete the 1120-01 FRC and release the return. The return will now read the DLN of the TC 090, post and generate an 1120-02 FRC. If TC 090 not posted, route return to originator explaining taxpayer does not have a valid Subchapter S election. See IRM 3.13.2.22 (3). This does not work for MeF returns as MeF returns must pass a FRC validity check. See IRM 3.13.2.9.21 for resolving electronic returns with a FRC problem.

3.13.2.7.5.1  (01-01-2015)
ERS Action Code 347 - Revenue Procedure 2013-30

  1. Rev. Proc. 2013-30 allows taxpayers to request relief by filing their Form 2553 and all required attachments with their Form 1120S as long as the current year Form 1120S is filed within 3 years and 75 days after the desired effective date. They may file electronically through Modernized e-File (MeF) or paper. Code and Edit will edit Error Resolution System (ERS) Action Code (AC) 347 on paper returns and MeF will generate ERS AC 347 for electronically filed Forms 1120S quoting Rev. Proc. 2013-30. For MeF returns, Entity TEs must print Form 2553 from the Employee User Portal (EUP). The instructions for this Rev. Proc. will be applied to unnumbered loose returns and numbered returns in the form of pipeline, Rejects, or Unpostables.

  2. Rev. Proc. 2013-30 modifies and supersedes Rev. Proc. 2003-43, Rev. Proc. 2004-48, and Rev. Proc. 2007-62 and supersedes the relief in Situation 1 of Rev. Proc. 97-48 as well as making obsolete the relief in Situation 2 of Rev. Proc. 97-48. Additionally, Rev. Proc. 2013-30 modifies, supersedes and makes obsolete certain relief in Rev. Proc. 2004-49.

  3. Requests for relief under Rev. Proc. 2013-30 filed on a return will be processed as follows:

    Note:

    Always ensure the IRS received date of the Form 1120S is also entered on Form 2553

    :

    If... And... Then...
    a) Initial Form 1120S is received with a Form 2553 attached requesting an effective date in a prior tax year, Form 2553 is complete with all required attachments and all necessary Forms 1120S are in house (filed simultaneously),
    1. Detach Form 2553 and required attachments to use as source document. For MeF returns, use the EUP. Edit "D2553, TC 090" , the date and your IDRS number in the left margin of each Form 1120S.

    2. Input TC 090 per IRM 3.13.2.22.6

    3. Annotate "TC 090" on Form 8161 or local routing slip.

    4. Release paper Form(s) 1120S to ERS/Rejects with instructions to hold one week (7 calendar days) then release for processing.

    5. If MeF, release to ERS/Rejects.

    b) Form(s) 1120S received with a Form 2553 attached requesting an effective date in a prior tax year, Form 2553 is complete with all required attachments but all necessary Forms 1120S have not been received per CCs ENMOD and UPTIN at both sites (not filed simultaneously), Approve Form 2553 for earliest possible effective date.
    See row l below for instructions on converting return(s).
    c) Form 1120S received with Form 2553 attached, Form 2553 is incomplete and all necessary Forms 1120S are in house (filed simultaneously),
    1. Input TC 093, if there is not a pending or posted TC 090.

    2. Input TC 971-375

      Note:

      Ensure FYM of return matches FYM on Master File even if return is invalid fiscal year, otherwise TC 971 will go UPC 307. TC 971 cannot be input on MFT02 if taxpayer is LLC unless there is a valid TC 076 posted for the current or prior year of the tax return. .

    3. Contact taxpayer via telephone (make two attempts) for missing information. Ask taxpayer to fax complete document within 48 hours. See Note below for telephone script.

    4. Annotate call on Form 12130 .

    d) Requested information is received within 48 hours, Form 2553 is complete (including necessary statements required by Rev. Proc.),
    1. Detach Form 2553 and required statements to use as source document. For MeF returns, use the EUP.

      • Edit "D2553, TC 090" , the date and your IDRS number in the left margin of Form 1120S.

      • Edit "D1120S, the IRS received date from the return, your IDRS number, the current date" on Form 2553.

    2. Input TC 090 per IRM 3.13.2.22.6

    3. Annotate "TC 090" on Form 8161 or local Reject routing slip.

    4. Release paper Form 1120S to ERS/Rejects with instructions to hold one week (7 calendar days) then release for processing.

    5. If MeF, release to ERS/Rejects.

    e) If requested information is not received within 48 hours and entity is a corporation or LLC with TC 076, PSC "A" posted, Form 2553 is incomplete and IDRS research does not satisfy completion requirements,
    1. Input TC 092,

    2. Input TC 971-376, PDC 1 (Ensure FYM matches Master File)

    3. Detach Form 2553 and edit "D2553, TC 093/092" in lower left margin on paper Form 1120S and Form 8161 (or local reject routing slip)

    4. Return Form 2553 to the taxpayer for completion using the 312C/6800sce letter. If using 6800sce, be sure to mark the box that tells the taxpayer if response is not received within 30 days, their Form 1120S will be converted to Form 1120. Put history item on CC ENMOD that reads: 6800SCE
      W2553

    5. Convert F1120S to Form 1120, see (9) below. Route to Rejects. Attach Form 12130 to paper return. If MeF, destroy Form 12130.

    Note:

    It is important TCs 971-375 and 971-376 are not input on the same day. This program has a 48 hour "suspense period"

    f) Requested information is not received within 48 hours and the entity is an LLC without TC 076 posted, Form 2553 is incomplete and IDRS research does not satisfy completion requirements,
    1. Input TC 092

    2. Detach Form 2553, edit "D2553, TCs 093 & 092" in lower left margin of paper return and Reject Routing Slip.

    3. Return Form 2553 to taxpayer in 312C/6800sce telling T/P that failure to respond will result in processing being stopped on their return. Insert DLN of return in fill-in 03 of 312C.

    4. Associate Form 12130 with paper return. If MeF, destroy Form 12130. Prepare paper return for cancellation by placing Reject Routing Slip on front of return. On Reject Routing Slip, request Rejects to cancel DLN and forward to Files. The return will be stored in Files under originally assigned DLN and is researchable using CC TRDBV.

    g) Form 1120S and Form 2553 are received from a corporation, Entity does not qualify for the effective date requested because this is not initial Form 1120S,
    1. Approve Form 2553 for the next qualifying effective date.

    2. Annotate "D2553, BK95" in the lower left margin of Form 1120S and on Form 8161 (or reject routing slip).

    3. See row l below.

    h) If return is initial Form 1120S, Form 2553 is complete (including statement of reasonable cause) and a posted TC 090 has effective date later than tax period of return,
    1. Input TC 092

    2. Input TC 090 with new effective date, PDC 1, PSC "Z" ,

    3. Annotate "TCs 092/090" in lower left margin of return and on reject routing slip (Form 8161 or reject routing slip).

    4. Send 385C to Taxpayer informing them the effective date of their S election has been approved based on Rev. Proc. 2013-30.

    5. Release Form 1120S to ERS/Rejects with instructions to hold one week (7 calendar days) then release for processing.

    i) Form 1120S is received with Action Code 347, Form 2553 is not attached and there is not a TC 090 posted on CC ENMOD of IDRS,
    1. Annotate "No 2553 No TC 090 Let Unpost" the date and your IDRS number in the lower left margin of Form 1120S and on Form 8161 (or reject routing slip).

    2. Release Form 1120S to ERS/Rejects.

    j) Form 2553 is not attached, There is a posted TC 090 for the tax period of the Form 1120S,
    1. Annotate "TC 090" the date and your IDRS number in the lower left margin.

    2. Release Form 1120S to ERS/Rejects.

    k) The effective date of the TC 090 is the same or prior to the effective date requested on Form 2553, The TC 090 was input less than 45 days prior to the IRS received date on Forms 1120S/2553,
    1. Place a large X on Form 2553 in blue ink.

    2. Annotate "TC 090" in lower left margin of Form 1120S and on reject routing slip (or Form 8161 for MeF Forms 1120S).

    3. Release Form 1120S to ERS/Rejects.

    l) Form 2553 cannot be approved for the requested tax year and is approved for the next qualifying year, 1) Form(s) 1120S rejected with Action Code 347 and the taxpayer is a corporation,
    1. Convert Form 1120S to Form 1120, see (6) below. Route to Rejects

    2. Input TC 971-376, PDC 1. Ensure FYM matches Master File,

    3. Input TC 090, suppress CP notice PSC>Z and send 385C informing taxpayer the Form 1120S was converted to a Form 1120.

    4. It may be necessary to input TC 076.

      2) Form 1120S is Rejected with Action Code 347 and the entity is a multi member LLC ,
    1. On Reject Routing Slip request Rejects to cancel DLN and forward to Files.

    2. Input 971-373 on MFT 06, same tax period as return being processed.

    3. Suppress CP notice (PSC>Z) and send 385C with DLN inserted informing taxpayer the Form 1120S was removed from processing.

    Note:

    1065 FRC must be on EIN prior to TC 971-373, therefore SMLLCs will not receive

    m) Initial Form 1120S is received with Form 2553 attached and taxpayer needs a new EIN assigned, Form 2553 is incomplete,
    1. Assign EIN using NIC 'A' and RIC ”53'

    2. Include "Let Unpost" in audit trail as TC 971–375 cannot be input until EIN posts to Master File.

    Note:

    Following is suggested script to be utilized when contacting the taxpayer via telephone for Rev. Proc. 2013-30 information. Remember, specific data should never be left on an answering machine. This is (TEs name) from the Internal Revenue Service and I am processing your Forms 1120S and 2553 filed under Rev. Proc. 2013-30. Before I can complete the processing of your forms I must ask for additional information. (State the needed information). Please fax this information to me at (your team's fax number) no later than (two days from today). If I do not receive the requested information within the time frame requested, your Form 1120S will be processed as a Form 1120.

  4. TC 971-375/373 indicates Form 1120S has failed to post to MF and a phone call was made or a letter has been issued to the taxpayer. TC 971-376 indicates the conversion of Form 1120S to a Form 1120, when there is no reply or when the reply received does not resolve the unpostable issue.

  5. If taxpayer is not an LLC, the LLC indicator must be deleted by inserting a "9" in the LLC indicator field. See IRM 3.13.2.25 (2).

  6. Process for converting Form 1120S to Form 1120.

    1. Circle out the "S" in the top left of return.

    2. Edit the name control if not previously edited.

    3. Edit Computer Condition Code 3 in the dotted section between Lines 1 through 6.

    4. Underline the Business Activity Code in Section B in the top left corner.

    5. Enter Audit Code 4 in left margin next to Line 12.

    6. On Reject Routing Slip instruct Rejects to renumber return to Form 1120.

  7. The most common examples of reasonable cause or inadvertence:

    • Miscommunication between the taxpayer's tax advisors/shareholders (for example attorneys, CPA/tax practitioner, accountants, bookkeepers, especially during incorporation period).

    • Circumstances beyond the taxpayer's control (for example unavoidable absence, illness), mistakes, or ignorance of the law.

    • Reliance on a paid professional (inside or outside the company) who failed to understand Form 2553 filing requirements.

    • Unavoidable delay in obtaining shareholder signature for the election.

    • One of the shareholders forgot to make the election or each shareholder thought the other was going to do it.

      Reminder:

      It is not possible to list every valid scenario that might be given by the taxpayer. If taxpayer acknowledges late filing with any plausible reason, and has included all other statements, give the taxpayer the benefit of the doubt and process form under Rev. Proc. 2013-30

  8. If the taxpayer responds with the correct return or responds and Form 2553 is approved for the tax year in question, input TC 971-377 to indicate the renumbered Form 1120 has been re-processed as a Form 1120S.

  9. TC 971 AC 376 will freeze all refunds to the taxpayer. To lift the freeze, input TC 971 AC 377.

  10. If correspondence is received in response to our inquiry regarding Rev. Proc. 2007-62 (or 2013-30), see IRM 3.13.2.22.4.1 (1) for processing instructions.

3.13.2.7.6  (01-01-2014)
ERS Action Code 321 (Ogden only)

  1. ERS Action Code 321 was created specifically for electronically filed consolidated tax returns with subsidiary EIN and Name Control mismatch. A Consolidated Return Resolution report will be submitted to Entity with a listing of each subsidiary EIN and name (along with the parent corporation's EIN and name) and whether or not the TC 590 Closing Code 014 was input. Entity will update the subsidiary's name and/or EIN as needed.

  2. Thorough research of both the parent and subsidiary accounts is necessary.

  3. Electronic filed returns will be routed to Entity by Rejects with a 10-day suspense period/turnaround time.

  4. If rejected MeF return is for a name and/or address change for the parent, access EUP to verify.

3.13.2.7.7  (01-01-2015)
Form 1041 Estates and Trusts

  1. This form is the income tax return for estates and trusts.

  2. The types of returns are

    • Form 1041, U.S. Fiduciary Income Tax Return.

    • Form 1041–A, U.S. Information Return—Trust Accumulation of Charitable Amounts.

    • Form 1041–ES, Estimated Income Tax for Fiduciaries.

    • Form 1041-QFT, Qualified Funeral Trusts.

    • Form 1041–N, Native Alaskan Settlement Trusts

  3. Form 1041-A is processed as an EO return; see IRM 3.13.12 , Campus Document Services - Exempt Organization Account Numbers.

  4. Form 1041-QFT is processed at the Cincinnati Campus (CSPC) only. See IRM 3.13.2.7.8.

  5. The return is filed annually and is due on the 15th day of the 4th month following the close of the tax year. See Figure 3.13.2-20.

    Figure 3.13.2-20

    This image is too large to be displayed in the current screen. Please click the link to view the image.
  6. The type of trusts that file Form 1041 are:

    1. Decedent's Trust - The fiduciary must file for a created trust from the estate of a decedent.

    2. Domestic Trust - The fiduciary must file for a domestic trust taxable under Treasury Regulation 1.645-1(c).

    3. Bankruptcy Estate - The fiduciary must file for an estate of an individual involved in bankruptcy proceeding under Chapter 7 or 11 of title 11 of the U.S. Code. Corporations, Partnerships, and LLCs in bankruptcy may create a Liquidating Trust, which is liable to file Form 1041.

    4. Trusts filing under Section 645 (Rev. Proc. 98-13) must state in the name line "Trust filing as an Estate under Section 645" and that designation needs to be input into IDRS. (Example, JOHN SMITH TR FILING AS AN ESTATE UNDER SECTION 645). After two years has elapsed for that entity, the trust needs a new EIN (at this point they are a new entity). There will not be an EIN consolidation issue since the new EIN will be input into IDRS as JOHN SMITH TR.

  7. Generally, a trust must adopt a calendar year (FYM 12) and the return is due on the 15th day of the 4th month following the close of the tax year. The following trusts are exempt from this requirement:

    • A trust that is exempt from tax under IRC Section 501(a);

    • A charitable trust described in IRC Section 4947(a)(1) ; and

    • A trust that is treated as wholly owned by a grantor under the rules of IRC Sections 671 through 679.

  8. If the taxpayer does not mark a box in Item A of Form 1041, and you can derive the exact type of entity by the name line, mark the appropriate box in Item A.

  9. Use the beginning of the tax year (located at the top of Form 1041) as the Business Operational Date (BOD). If the date entered in the Date Entity Created box is during the year covered by the return, use that date as the BOD.

  10. The chart below contains associated terms and types of trusts:

    Term Definition
    Fiduciary
    • Trustee of a trust, or

    • Executor, executrix, administrator, administratrix, personal representative, or person in possession of a property of a decedent

    Beneficiary A person designated as the recipient of funds or other property under a trust or an estate
    Corpus The principal sum of the capital of a trust or an estate, as distinguished from interest or income
    Maker/grantor The person(s) or organization that
    • Originated the trust, or

    • Has control over the trust

    Simple Trust A trust
    • For which the trust instrument requires that all income be distributed currently, with no authority to make charitable contributions or distribute amounts allocated to the corpus of the trust, and

    • That is a simple trust only for a year in which it distributes income and makes no other distributions to beneficiaries

      Note:

      When a trust does not meet these requirements for a year, it is a complex trust.

    Complex Trust A trust which, for the taxable year, does not qualify as a simple trust
    Grantor Trust A trust that
    • Is established by a living person or organization, created by a will, or

    • Is established so the income from the trust is taxable income of the grantor

    Non-taxable grantor trusts do not report income, deductions, and credits on Form 1041. The grantor may file Form 1041 for informational purposes only.
    Intervivos Trust A trust established by a grantor during his/her lifetime.
    Revocable Trust The grantor:
    • Has control of the trust (for example, has power to repeal or annul), and

    • Pays the taxes of the trust on his/her Form 1040. The grantor files Form 1041 for informational purposes only.

    Irrevocable Trust The grantor has no control of the trust and the trust pays the taxes.
    Testamentary Trust A testamentary trust is created by a will, which begins its existence upon the death of the person making the will, when property is transferred from the decedent's estate. Testamentary trusts are generally simple or complex trusts. A testamentary trust is irrevocable by definition, as it comes into being at the death of the grantor. It is also known as a "trust under the will" .
    Residual Trust A trust set up to receive the part of an estate that remains after the payment of all debts, charges, devices, and bequests to entities other than the beneficiary
    Conservatorship A trust set up for an incompetent person
    Guardianship/
    Custodianship
    A trust set up for a minor or incapacitated person
    Ancillary and Domiciliary Trust Returns A trust which exists in a foreign domestic state because the grantor is domiciled (resides) in another state within the United States.
    Family Estate Trust
    • A trust instrument provides evidence of ownership, such as certificates of beneficial interest in the trust.

    • The grantor is a trustee and executive officer; and

    • The corpus and undistributed income are distributed to the owners after the trust is terminated. This is also known as a family estate, pure trust, equity trust, equity pure, prime, or constitutional trust.

    Generation Skipping Trust A trust with younger generation beneficiaries who are more than one generation younger than the grantor’s generation. 
    Pooled Income Trust (also known as Split Interest Trust) A split interest trust with a
    • Remainder interest for a public charity, and

    • Life income interest retained by a donor or for another person

    Clifford Trust A grantor type trust where the assets are placed in a trust but there is still some ownership. It is taxable to the grantor.
    Non-Explicit Trust
    • An arrangement that has substantially the same effect as a trust. It is treated as a trust even though it is not an explicit trust.

    • Non-explicit trusts do not include the decedent’s estate.
      Examples: Insurance and annuity contracts, arrangements involving life estates and remainders

    Non-exempt Charitable Trusts A trust that is set up for a charitable purpose but that is not eligible for exempt status
  11. If Form 1041 is being filed for an individual bankruptcy estate and an EIN must be assigned, the EIN will be assigned in the name of the debtor. The trustee's name will be entered on the Sort Name Line.

  12. When Form 1041 is filed for Corporations, Partnerships, or LLCs that are in bankruptcy, do not assign a new EIN unless the words "Liquidating Trust" are present. If these words are not present, send 177C requesting correct return for entity type and route return to originator.

  13. If a Form 1040 is received that is overlaid with a Form 1041, do not detach form 1040. The final Form 1040 should be filed for the same year a taxpayer becomes deceased. Quite often, executors of estates will file Forms 1040 for tax periods beyond the year the date of death is in. These Forms 1040 must be converted to Forms 1041.

    • Research for an estate EIN. If an EIN is found, enter the EIN on the Form 1041. Do not send a letter.

    • If an EIN is not found, assign an EIN, suppressing the notice with NIC D. Do not send a letter.

    • Ensure the Computer Condition Code (CCC) F is entered on the return.

  14. A decedent's estate is fairly straightforward. The executor/administer/etc. will be placed on the Sort Name line.

  15. If processing Form 1041 that bears an EIN with "Section 645" annotated in the name line and Forms 1041 for two tax periods are posted to the EIN, assign a new EIN with NIC "B" , RIC "05" , and applicable tax period. Input TC 591-020 on the Section 645 EIN for the tax period of the Form 1041 being processed.

  16. If Form 1041 is received indicating "No Liability" , see IRM 3.13.2.9.14.

3.13.2.7.8  (01-01-2014)
Form 1041-QFT, U.S. Income Tax Return for Qualified Funeral Trusts

  1. The trustee of a trust that has elected to be taxed as a qualified funeral trust (QFT) files Form 1041-QFT to report the income, deductions, gains, losses, etc., and income tax liability of the QFT.

  2. Form 1041-QFT will be processed at the Cincinnati Campus only.

  3. Use the beginning of the tax year (located at the top of Form 1041-QFT) as the Business Operational Date (BOD).

  4. Follow these procedures if forms are received at centers other than CSC. Instructions apply to non-remittance

    1. Research to determine the correct filing requirement and if any estimated payments posted to the old EIN.

    2. Follow guidelines as appropriate under remittance QFTs.

  5. Follow these procedures to avoid balance due notices and incorrect filing requirements on QFTs with remittance. RCO/Extraction will call Entity when these returns are identified and the proper research must be completed before Deposit Activity process the payment. Forms 1041–QFT must be processed on a same day basis. Research to determine the filing requirement.

  6. If FRC "9" is present, continue processing as received (QFT entity has already been established).

  7. If FRC other than "9" is present (most likely FRC "1" ), determine the entry present on Line 4 (Part 1) of Form 1041–QFT (number of QFTs included on this return).

    1. If line 4 contains an entry of 2 or more, establish a new EIN with FRC "9" .

    2. If line 4 is blank, or contains an entry of 1, and the filer has applied for a new EIN, establish a new EIN with FRC "9" .

    3. If line 4 is blank, or contains an entry of 1, but the filer has not applied for a new EIN, change the filing requirement to FRC "9" , but retain the existing EIN.

      Note:

      All Forms 1041–QFT must be established with FRC "9" . Taxpayers who elect to file a "single" Form 1041 QFT in lieu of Form 1041, may retain their original EIN as previously used for filing Form 1041. Taxpayers who elect to file a "composite" Form 1041–QFT (filed for more than one trust), must obtain a new EIN.

3.13.2.7.9  (01-01-2015)
Form 1065, U.S. Partnership Return of Income

  1. This return is filed to report the income, deductions, gains, losses, etc., from the operation of a partnership. See Figure 3.13.2-21.

  2. The return is filed by all domestic partnerships, foreign partnerships, and Limited Liability Companies classified as partnerships for federal income tax if those entities have income from a trade or business within the United States or have income from sources in the United States.

  3. The return is filed by religious and apostolic organizations that are exempt from income tax under IRC Section 501(d). These taxpayers are reorganized on the BMF with a Subsection Code 40. A Form 1065 filed by these organizations is treated the same as any Form 1065, except name changes and address changes affecting the name lines must be processed under instructions in this IRM.

  4. The Tax Reform Act of 1986 requires all partnerships to use the tax year of their owner, usually December 31. If the partnership/LLC has received permission to use a fiscal tax year or a fiscal tax year is the actual year end of the owner, a TC 054 or TC 055 will be posted on the Entity module. If the taxpayer has not received permission to use a fiscal year, the phrase "allow to UPC 307" will be entered in the audit trail. The invalid tax year will be addressed when the return becomes unpostable.

  5. Regulation 1.761-2(b)(2) allows a certain investing partnerships and unincorporated organizations operating under joint production, extraction, or use agreements to elect out of partnership treatment by filing their an initial Form 1065 with a list of the partners/members names and addresses. Attached must be a statement that the entity qualifies to elect out of Subchapter K under Reg. 1.761-2. The Computer Condition Code (CCC) F will be edited onto the return. Note: This is called an election out of Subchapter K election. A Private Letter Ruling (PLR) is required to revoke this election.

    Note:

    This is called a Subchapter K election. A Private Letter Ruling (PLR) is required to revoke this election.

  6. Under IRC Section 708, a partnership is terminated if there is a sale or exchange of 50 percent or more of the total interest in partnership capital and profits within a 12-month period. Known as a “technical termination,” the partnership is treated as contributing all of its assets and liabilities to a new partnership in exchange for an interest in the new partnership, followed by a distribution of the interest in the new partnership to the purchasing and other reaming partners. Treasury Regulation § 301.6109-1(d)(2)(iii) provides that the new partnership will retain the EIN of the terminated partnership. The partnership will file two short year Forms 1065: one with a year closing on the date on which the partnership terminates, and a second for the remainder of the year. See Treas. Reg. § 1.708-1(b)(3).

  7. The return is filed annually and the return is due:

    1. For domestic partnerships on the 15th day of the 4th month following the close of its tax year.

    2. For partnerships that keep their records and books of account outside the United States and Puerto Rico, on the 15th day of the 6th month following the close of its tax year. The partnership must attach a statement to the Form 1065 stating that the partnership qualifies for the extension of time to file and pay.

  8. Use the beginning of the tax year (located at the top of Form 1065) as the Business Operational Date (BOD). If the date entered in the "Date Business Started" box is during the year covered by the return, use that date as the BOD.

  9. When Form 1065 is received from Code and Edit or ERS, research to determine the number of partners/members. If the return indicates the number of Schedules K-1 is "1" and the Schedule K-1 attached to the return has 100% interest in the partnership, correspond with the taxpayer as this is an invalid return. If the taxpayer fails to reply or states in their response they are no longer a partnership, input a TC 591 CC 020 to close the filing requirement. Route it back to the area that routed it to Entity.

    Figure 3.13.2-21
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  10. Termination of a partnership under IRC Section 708(b)(1)(B) . This section states that a partnership shall be considered terminated if within a 12 month period there is a sale or exchange of 50% or more of the total interest and if the purchaser and remaining partners immediately contribute the properties to a new partnership, they can retain the old partnership EIN. If they apply for a new EIN, then they will use the new EIN. If they do not quote IRC Section 708(b)(1)(B) , assign a new EIN. If they quote IRC § 708(b)(1)(B) , do not assign a new EIN.

3.13.2.7.10  (01-01-2014)
Form 720, Quarterly Federal Excise Tax Return

  1. Form 720 is filed to report liability for certain excise taxes. See Figure 3.13.2–22.

  2. If the return is for a one time filers, mark the return final and suppress the notice.

  3. If the taxable period is a calendar quarter, Form 720 is due by the last day of the first calendar month following the quarter for which it is made.

  4. Form 720 is filed and processed at the Cincinnati Submission Processing Center.

  5. The Affordable Care Act (ACA) created the Patient Centered Outcomes Research (PCOR) tax which will be reported on Line 133 of Form 720. This tax begins with the second quarter of 2013 and will be reported once a year. Therefore, the correct FRC for this taxpayer is 720-4. The account must be updated with this FRC. If the taxpayer is reporting Line 133 and any other Line, 720-1 is the correct FRC. This guidance will be used when ESIGNing an EIN or updating an account.

    Figure 3.13.2-22

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3.13.2.7.11  (01-01-2014)
Forms 11–C, Occupational Tax and Registration Return for Wagering, and 730, Monthly Tax on Wagering

  1. Form 11–C , Occupational Tax and Registration Return Wagering

    1. Form 11–C is filed by persons who accept taxable wagers to register certain information with the IRS and to pay the occupational tax imposed under IRC § 4411.

    2. The occupational tax is $50 per year if taxable wagers accepted are authorized under the laws of the state in which accepted or $500 per year for all other taxable wagers.

    3. All persons engaged in the business of receiving taxable wagers on their own behalf are required to file Form 11–C before accepting taxable wagers (principal operators). Anyone who accepts taxable wagers on behalf of a principal operator (agents) also is required to file Form 11–C before accepting taxable wagers.

    4. The first return will cover the tax period from the start of business until June 30 of the current year. For subsequent years, the form is due by July 1 as long as taxable wagers are accepted. The BOD is the date (month and day) listed at the top of Form 11–C. See Figure 3.13.2-23.

    5. The processing of Form 11–C is centralized at the Cincinnati Campus.

    Figure 3.13.2-23

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  2. Form 730, Monthly Tax on Wagering

    1. Taxpayers must file Form 730 and pay the tax on wagers under IRC § 4401(a) if they are in the business of accepting taxable wagers, accept a wager, or conduct a wagering pool, or lottery for profit, or are required to be registered (because they receive taxable wagers on behalf of another who would otherwise be liable for the tax) and they fail to properly register.

    2. On wagers authorized under the laws of the state in which accepted, tax is imposed at a rate of .0025 percent of the amount of the wager. All other taxable wagers are subject to a rate of .02 percent of the amount of the wager.

    3. Form 730 is a monthly return that must be filed by the last day of the month following the month for which taxable wagers are reported. Once filed, Form 730 must be filed each month until a final return is filed, even if the taxpayer receives no wagers that month. These returns will show no activity. If no taxable wagers will be received in the future, a final Form 730 must be filed. The return must reflect the notation "Final Return." The BOD is the first day of the month entered above line 1 on the return.

    4. Persons liable for filing Form 730 must also file Form 11–C to be registered to accept wagers and to pay the occupational tax.

    5. The processing of Form 730 is centralized at the Cincinnati Campus. See Figure 3.13.2-24.

    Figure 3.13.2-24

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3.13.2.7.12  (01-01-2014)
Form 2290, Heavy Highway Vehicle Use Tax Return

  1. Form 2290 is filed to report the tax due on highway motor vehicles with a taxable gross weight of 55,000 pounds or more driven on public highways during the taxable period. See Figure 3.13.2–25.

  2. The taxable period begins each July 1 and ends the following June 30. For vehicles first put into service in July of the taxable period, Form 2290 is due by August 31. For vehicles first put into service after July of the taxable period, Form 2290 for that period is due by the last day of the month following the month of first use. The BOD is the first day of the month entered on line 1 of the return.

  3. Form 2290 is filed by the person in whose name a taxable vehicle is registered or required to be registered at the time of its first use on public highways.

  4. Vehicles put into service and actually operated by the Federal Government, a state or local government, or an Indian tribal government if the vehicle's use involves the exercise of an essential tribal government function, are exempt from tax.

  5. The processing of Form 2290 without payment due or using EFTPS is centralized at the Cincinnati Submission Processing Center.

    Figure 3.13.2-25

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3.13.2.7.13  (01-01-2014)
Processing Foreign Forms 706 and 709 series

  1. Form 706 is filed by both American citizens and non U. S. citizens who are residents of the U. S. These decedents are taxed on their worldwide assets. Form 706-NA (attached to which may be schedules from Form 706) is filed by non-U.S. citizens who are not residents of the U.S. (also known as alien nonresident decedents). These decedents are taxed on U.S. property only.

  2. (2) Form 709 is filed by U.S. citizens, non-U.S. citizens who are residents of the U.S., and non-U.S. citizens who are not residents of the U.S. With respect to U.S. citizens who are not residents of the U.S., the Federal Gift Tax only applies to transfers of real property and tangible personal property physically situated in the U.S.

  3. The processing procedures for foreign taxpayers are the same as domestic taxpayers. See IRM 3.13.2.7.13.1 through IRM 3.13.2.7.13.7.

  4. Research should always be performed to ensure the correct SSN is being used. If unable to locate a valid SSN or the taxpayer does not have an SSN, an Internal Revenue Service Number (IRSN) must be assigned from the TEMP SSN software. Once assigned, the IRSN will be established on the invalid portion of the "V" tape, which is the "W" tape.

3.13.2.7.13.1  (01-01-2015)
Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return

  1. Form 706 is filed by the executor of an estate of a decedent who was a U.S. citizen or a non -U.S. citizen who was a resident of the U.S. or resident of the United States to determine the estate tax imposed by Chapter 11 of the IRC on the decedent’s worldwide assets, (which is levied on the entire taxable estate, not just on the share of the estate received by a particular beneficiary). This form is also used to determine and the generation-skipping transfer tax imposed by Chapter 13 of the IRC.

  2. This return is filed with the decedents social security number and the entity is treated like a BMF SSN.

  3. The return is filed within 9 months after the date of the decedents death. A Form 4768 is filed to request extensions.

  4. With respect to decedents who died in For Tax Year 2010 only, the executors of their estates had the option to elect that their estates not be subject to the estate tax but instead be subject to the provisions of section 1022 (the carryover basis rules). This election had to have been made by filing Form 8939 by January 17, 2012 will be filed with Form 1040 to report Estate income. Notice 2011-66, 2011-35 IRB 184, sets forth limited relief for estates of decedents who died in Tax Year 2010 the executors of which did not file Form 8939 by January 17, 2012. Such relief can only be obtained through the private letter ruling program.

3.13.2.7.13.2  (01-01-2015)
Form 706-A, United States Additional Estate Tax Return

  1. Form 706-A This return is filed by the qualified heir of a decedent to report a taxable disposition or cessation of qualified use of property valued under Section 2032A of the IRC on the decedents estate tax return.

  2. The form is filed with the qualified heir's social security number.

  3. The return is filed within 6 months after the taxable disposition or cessation of qualified use. A Form 7004 is filed to request an extension.

3.13.2.7.13.3  (01-01-2015)
Form 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions

  1. Form 706-GS(D) is filed by taxpayers who are "skip persons" who receive a taxable distribution from a trust.

  2. The Form 706-GS(D) must be filed with the SSN, if the distributee is an individual, and the trust's EIN if the distributee is a trust.

  3. The return is filed on a calendar year basis by April 15th of the year following the calendar year when the distributions were made.

  4. Form 7004 is filed to request extensions.

3.13.2.7.13.4  (01-01-2015)
Form 706-GS(T), Generation-Skipping Transfer Tax Return for Terminations

  1. Form 706-GS(T) is filed by the trustee of any trust which has a taxable termination.

  2. The Form 706-GS(T) is filed with the trust's EIN.

  3. The return is filed by the trustee of the trust by April 15th of the year following the calendar year in which the termination occurs.

  4. Form 7004 is filed to request extensions.

3.13.2.7.13.5  (01-01-2015)
Form 706-NA, United States Estates (and Generation-Skipping Transfer) Tax Return

  1. Form 706-NA is filed by the executor of an estate of a decedent who was not a citizen or resident of the United States to figure the estate tax imposed by Chapter 11 of the IRC on the value of the decedents gross estate located in the United States under the situs rules of the IRC and the generation-skipping transfer tax imposed by Chapter 13 of the IRC. This return is filed by the executor of an estate of a decedent who was not a U.S. citizen or resident of the U.S. (also known as an alien nonresident decedent) to figure the estate tax imposed by Chapter 11 of the IRC on the value of the decedent’s gross estate located in the U.S. under the situs rules of the IRC and the generation-skipping transfer tax imposed by Chapter 13 of the IRC on those assets. Schedules from Form 706 may be attached to Form 706-NA.

  2. The Form 706–NA is filed with the decedents U.S. social security number (if any).

  3. The return is due 9 months after the date of the decedents death. A Form 4768 is used to request an extension of time to file.

3.13.2.7.13.6  (01-01-2015)
Form 706-QDT, U.S. Estates Tax Return for Qualified Domestic Trusts

  1. Form 706-QDT is filed by the trustee or designated filer of a Qualified Domestic Trust (QDT) to figure and report estate tax due on certain distributions and taxable events with respect to a surviving spouse who is not a U.S. citizen. The return is also filed to report that the spouse has become a U.S. citizen and therefore, the QDT is no longer subject to the additional estate tax.

  2. The Form 706-QDT is due with the EIN of the trustee/designated filer, or, if the trustee/designated filer is an individual, with his/her SSN.

  3. The Form 706-QDT is generally filed on April 15th of the year following any calendar year in which a taxable event occurred during the spouse's lifetime, or a distribution was made to the spouse on account of hardship, or the spouse becomes a U. S. citizen. The return must also be filed within nine months of the death of the spouse, and within nine months after the trust ceases to qualify as a QDT. Extensions are granted by filing Form 4768.

3.13.2.7.13.7  (01-01-2015)
Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return

  1. Form 709 is filed by U.S. citizens, non-U.S. citizens who are residents of the U.S., and non-U.S. citizens who are not U.S. residents who make transfers subject to the Federal Gift Tax taxpayers who are subject to the Federal Gift Tax. Note, with respect to non -U.S. citizens who are not U.S. residents the Federal Gift Tax can only apply to transfers of real property and tangible personal property physically situated in the U.S.

  2. The return is filed by individuals using their social security number and the entity is treated like a BMF SSN. This return is never filed as a joint return.

  3. The return is filed on a calendar year basis by April 15th of the year following the calendar year in which the gift was made. An extension to file can be obtained by Form 8892. An extension of time to file the donor's income tax return also extends the time to file the gift tax return.

    Note:

    No extension transaction (TC 460) will post to the BMF when the donor has an extension of time to file his/her income tax return. IMF will show a posted TC 460.

3.13.2.7.14  (01-01-2015)
Form 7004, Application for Extension of Time to File Certain Business Income Tax, Information, and Other Returns

  1. This form is filed to request a five or six month extension to file for Forms 706GS(D), 706-GS(T), 1041, 1041-N, 1041-QFT, 1042, 1065, 1065-B, 1066, 1120, 1120-C, 1120-F, 1120-FSC, 1120-H, 1120-L, 1120-ND, 1120-ND (§ 4951), 1120-PC, 1120-POL, 1120-REIT, 1120-RIC, 1120S, 1120-SF, 3520-A, 8612, 8613, 8725, 8804, 8831, 8876, 8924, and 8928.

  2. If a Form 7004 is found attached to a return, do not detach.

  3. Returns that can receive a five month extension are:

    • Form 1041, other than for a bankruptcy estate

    • Form 1065

    • Form 8804

  4. All remaining forms will receive a six month extension of time to file.

  5. The form must be filed by the normal due date of the type of return the taxpayer is requesting to file.

  6. Never allow a Form 7004 for MFT 02 (a corporate return) to post for a Limited Liability Company (LLC) when there is not a TC 076 on the Entity module. If Form 1120 FRC is present on the account, and there is not a TC 076, input TC 016 to zero out the Form 1120 FRC and add a Form 1065 FRC. This will cause Form 7004 to go Unpostable Code (UPC) 329.

  7. If Form 7004 contains "INC" in the name line, is coded for MFT 02, and Master File shows "LLC" , ensure a 1065 FRC is on Master File. This will cause Form 7004 to go UPC 329.

  8. If it is necessary to correspond with the taxpayer on a Form 7004, send the letter to the address on Master File and inform the taxpayer of any address discrepancy. The address on Master File should never be updated from an extension.

    Note:

    Never write the taxpayer when Form 3520-A is marked. This includes during the ESIGN process. Ensure NIC 'D' is used when ESIGNing.

  9. The MFT for this extension is determined by the type of return for which it is filed. See Figure 3.13.2-27.

    Figure 3.13.2-26

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3.13.2.7.14.1  (01-01-2015)
Form 8868, Application for Extension of Time to File an Exempt Organization Return

  1. This form is filed to request a 3 month extension to file, except for the Form 990-T filed by a corporation, which is entitled to a six-month extension.

  2. Returns requesting an extension are:

    • Form 990

    • Form 990-BL

    • Form 990-EZ

    • Form 990-T

    • Form 1041-A

    • Form 4720

    • Form 5227

    • Form 6069

    • Form 8870

  3. The MFT for this extension is determined by the type of return for which it is filed.

3.13.2.7.15  (01-01-2014)
Forms 1042 and 1042-S, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons and Foreign Person's U.S. Source Income Subject to Withholding

  1. Form 1042 is filed by the domestic filer and will already have an EIN. This taxpayer is probably filing other BMF returns and therefore should already have an EIN.

  2. Form 1042-S is the recipient's account and will be a foreign resident or a non-resident alien. The taxpayer may have an EIN, SSN or an ITIN. See IRM 3.13.2.9.6 (5).

  3. Whenever Entity Control receives a Form 1042 which does not show an EIN (including a Form 1042 return identifying the Filer by Social Security Number), it will research to see if a number has already been assigned. If none is found, Entity will assign an EIN and notify the filer in accordance with established procedure.

  4. Form 1042 filers may no longer be identified by a social security number. All returns forwarded by Document Perfection, which identify the filer by SSN will be treated as new filers, and an EIN will be assigned as in (1) above. Circle out the SSN, and enter the EIN above it.

  5. Qualified Intermediaries (Foreign Corporations)— Any Form SS-4 received indicating "Qualified Intermediary" or Form 1042 Filer on Line 8a or 9 with the other box checked, establish a 1042 filing requirement. DO NOT establish a 1120-F filing requirement.

  6. If the filing requirement is not present, use the information in the table below to establish the filing requirement for Form 1042. Use CC BNCHG to make the change.

    FORM 1042
    Tax Class Doc. Code MFT Code BOD WPD FYM FRC
    1 25 12 No No Yes 0 - Not required to be filed
      1 - Return required to be filed
    8 - Account Inactive
    Incompatible Filing Requirements: ......................None

3.13.2.7.16  (01-01-2014)
Forms 1066 - U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return

  1. This return is filed to report the income, deductions, and gains and losses from the operation of a Real Estate Mortgage Investment Conduit (REMIC). In addition, the form is filed by the REMIC to report and pay tax on net income from prohibited transactions. This return is filed under a separate EIN than the owner's primary EIN.

  2. When researching for an EIN, a new EIN must be assigned if the account found has a Form 1041, 1065, 1120, etc., filing requirement code. A partnership, corporation, trust, etc., cannot file a REMIC return with their partnership, corporation, etc., EIN. A new EIN must be assigned.

  3. Any entity that elects to be treated as a REMIC for its first tax year and meets the requirements of IRC § 860D(a) must file Form 1066.

  4. If a REMIC EIN is located and it does not contain the acronym "REMIC" , add the acronym "REMIC" to the end of the primary name line.

  5. For Form 1066, U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return, name control the first four characters of the REMIC name.

    • Striped Tree Mortgage Pass—Through Certificate Series

    • Daisy Asset Investors TR 1

    • Rose TR 1, Series A

  6. This return is generally filed by April 15th. However, if a "final" Form 1066 is being filed, the form is due by the 15th day of the 4th month following the date the REMIC ceased to exist. All taxpayers filing this return must have a calendar year tax year. See Figure 3.13.2–28.

    Figure 3.13.2-27

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3.13.2.7.17  (01-01-2014)
Form 3520, Annual Return to Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts (OSPC Only)

  1. Do not correspond with anyone on Form 3520 or allow any notices to generate.

  2. Form 3520 will be forwarded to Entity for research of a valid TIN for Item 1b of Form 3520.

  3. If the "Individual" box is checked in Item B, Entity will research for an SSN. Use CC INOLE'T' to determine if SSN has already been established on the BMF. If the SSN is on the 'V' tape, it is considered valid. An SSN* on the 'W' tape is considered invalid.

  4. If an SSN cannot be found, assign an IRSN with CC TMSSN. then establish the IRSN on the 'W' tape of the BMF. CC INOLE'S' will provide all of the information from the SSN needed to establish the SSN on the BMF.

  5. Access CC ENMOD with the SSN followed by a 'V' (or 'W'). Overlay ENMOD with ENREQ to receive BNCHG. Complete the following fields of CC BNCHG to establish the SSN on the BMF:

    • Enter "000" in the TC>field

    • The NEW-NAME-CTRL> field should be completed with the taxpayer's name control

    • Enter the taxpayer's name and address in the appropriate fields. Include a comma behind the state abbreviation

    • The MFT> field should contain "68"

    • Enter "PER F3520 FOR (TAX PERIOD)" in the REMARKS> field

  6. If the box for Partnership, Corporation, Trust or Executor is marked in Item B, the taxpayer will use an EIN.

    If... And... Then...
    a) The first, second, or third box under Check all applicable boxes: is checked, Line 2b is blank, Research for an EIN. If unable to locate a valid EIN, use CC ESIGN to assign an EIN. Use prefix "98" with NIC "D" ,
    b) The fourth box is checked under Check all applicable boxes:, Line 2b is blank, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
  7. An extension of time to file Form 3520 is not needed. An extension for the taxpayer's annual return covers Form 3520.

    Form 3520
    Tax Class Doc. Code MFT Code BOD WPD FY FRC
    3 83 68 No No Yes 1 - Return required to be filed
    Incompatible Filing Requirement: .......................None

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