3.13.12  Exempt Organization Account Numbers (Cont. 2)

3.13.12.6 
Entity Changes for an EO/BMF Account

3.13.12.6.28 
Employment Code

3.13.12.6.28.5  (01-01-2015)
Not Type of Employment Code F Organizations

  1. Do not assign Employment Code F to the following:

    • A state or local entity such as a state, county, city, town, school, authority, district as described in 3.13.12.6.29.5.

    • A Federal Credit Union which should be coded employment code Z.

    • A foreign entity that is not clearly associated with the US government overseas operations, generally Department of State, embassies or military installations.

    • Any religious, fraternal or benevolent organization

    • Veterans organizations and related auxiliaries such as Veterans of Foreign Wars (VFW), American Legion, American Veterans (AMVETS) organizations and Disabled American Veterans (DAV).

    • Any ethnic or tribal organization; i.e., Indian tribe, tribal council, etc.

    • Any private corporation or business entity which has in its name words such as "U.S., United States, Federal or Government"

3.13.12.6.28.6  (01-01-2015)
Questionable Employment Code F Organizations

  1. If the employment code can not be determined or is a questionable Employment Code F organization, do the following:

    1. Research the account as necessary.

    2. Contact the organization to clarify its status.

  2. If the organization is determined to be a true Employment Code F organization, remove any erroneous filing requirements such as Form 1120, Form 1065, etc.

  3. If the organization is determined to not be a true Employment Code F organization, process as follows:

    1. Remove any erroneous filing requirements.

    2. Remove the "F" code.

    3. Establish the entity with the correct filing requirements. Ensure the organization does not have another EIN established for the same "F" code entity.

3.13.12.6.28.7  (01-01-2015)
Employment Code G

  1. Employment Code G is assigned to all state and local government agencies.

  2. Employment Code G assignment is restricted. Entity cannot assign employment code G.

  3. Assign Employment Code G to the following organizations:

    • State or commonwealth

    • Agency, bureau, or department of a state or commonwealth

    • County

    • Agency, bureau, board, or department of any such county

    • Municipality, town, village, ownership or any like unit of local government

    • Agency of a local government, such as a school district, board of education, public school, sanitation district, transit authority, welfare department, housing authority, cemetery, soil or water conservation district, water district, community service district health department, etc.

  4. If a state or local government instrumentality requests and receives an exemption under IRC 501(c)(3) of the IRC, the Employment Code remains a G.

  5. For information regarding the input of Employment code G, refer to IRM 3.13.12.6.29.

3.13.12.6.28.8  (01-01-2015)
Employment Code I

  1. Assign Employment Code I to Indian Tribal Governmental entities. National Office ITG will determine if an entity requires an EC I. If so, verify the BOD Code is TE. Update the BOD Client Code to I. Add a Form 940 FR of either 3 (compliant) or 4 (non-compliant) at the time the EC I is added. National Office ITG will determine whether the tribe is compliant or non-compliant. There is no need to forward any information to National Office.

  2. If an Indian Tribal Governmental entity also has an IRC 501(c)(3) exemption, the Employment Code must be W with no Form 940 filing requirement.

  3. If Master File research indicates the EO Status is 41, 70-72, treat the entity as if they are a "regular" ITG entity with a BOD Code of TE, EC of I, BOD Client Code of I or 1, and a Form 940 FR of 3 or 4.

  4. If the EO Status is 40 or 42, the BOD Code should be TE, but make no changes to the EC, BOD Client Code or filing requirements. If the EO Status was in 40 for several years and the organization is continuing to file Forms 941 only and there is no "I" case on EDS, update the EO Status to 41 and treat as a "regular" ITG entity.

3.13.12.6.28.9  (01-01-2015)
Employment Code M

  1. Assign this code to those maritime industry entities which have made payments for employment taxes not yet reported. This situation arises when a shipping company estimates liabilities and makes payments currently. However, the actual liability is reported on a supplemental Form 941 filed at the termination of the voyage.

3.13.12.6.28.10  (01-01-2015)
Employment Code S

  1. Assign Employment Code S to a domestic business which has applied for another EIN to extend social security coverage to certain employees of its foreign affiliates by filing Form 2032, "Contract Coverage under Title II of the Social Security Act as Amended" . Do not establish a Form 940 FRC for these entities.

3.13.12.6.28.11  (01-01-2015)
Employment Code T

  1. This code is never to be assigned from Form SS-4.

  2. Employment code T is strictly controlled by FSLG CPM and should never be assigned outside that unit. All 218 Agreements, modifications and dissolutions are currently required to be sent directly to FSLG CPM from the state social security administrators and regional social security administration offices.

  3. If any such documents are received at the campus they should be sent directly to FSLG CPM for action.

  4. Send with a transmittal Form 3210 via fax to the FSLG CPM EEFax (855) 243–4014 or mailed to:
    Internal Revenue Service
    SE:T:GE:FSL:CPM
    308 E 8th St.
    Mail Stop 4098 AUS
    Austin, TX, 78701

3.13.12.6.28.12  (01-01-2015)
Employment Code W

  1. Assign Employment Code W and a Form 941 FR of 01 to non-profit organizations with employees of the type described in IRC 501(c)(3), 501(e), 501(f), 501(k) and 501(n) of the IRC. These organizations are operated exclusively for religious, charitable, scientific, literary, educational, or humane purposes, or for the purposes of testing for public safety.

  2. Non-profit organizations are not subject to FUTA. They are also not subject to FUTA tax during the application for exempt status. Apply FUTA tax if it is determined an application for exempt status has not been submitted.

  3. A church has an IRC 501(c)(3) status but does not officially have to file an application for exemption. If the name of the organization contains the following word(s), assign an EC W:

    • Assembly or Assembly of God

    • Chapel

    • Church

    • Fellowship

    • Jehovah's Witness

    • Monastery

    • Seventh Day Adventist

    • Synagogue

    • Mosque

    • Temple

    • Worship Center

    • Iglesia

    • Kirche

  4. A ministry, however, is not considered a church and must apply for exemption. If the name of the organization contains the word "ministry," do not assign EC W.

3.13.12.6.29  (01-01-2015)
Fiscal Year Month

  1. The fiscal year month ending (FYM) is a two digit code of 01 through 12. It is the month in which the fiscal year of the entity ends.

  2. Input the FYM on all Exempt Organization returns which can be any month.

    Exception:

    Forms 5227 filed by Non-exempt Charitable Trusts under IRC 4947(a)(2) must have an FYM of 12, unless filing a final return.

  3. If an FYM is indicated by the organization, input that month.

  4. If no FYM is indicated, enter:

    1. the month preceding the date the business was acquired,

    2. the month preceding the date wages or annuities were paid, OR

    3. the month preceding the current month.

    Exception:

    Forms 5227 filed by Non-exempt Charitable Trusts under IRC 4947(a)(2) must have an FYM of 12, unless filing a final return.

  5. If a Form 1128, Application to Adopt, Change or Retain a Tax Year, is received with a Form SS - 4, refer to IRM 3.13.12.18.

  6. When inputting the Fiscal Year Month (FY) with CC EOREQ/EOCHG and the Document Code is 80 or 81:

    If Then
    Doc. Code is 80, TC may be 000, 012, or 016.
    Doc. Code is 80 and a positive FRC is input for Forms 990, 990-C/1120-C, 990-PF, 990-T, 1041, 1065, 1120 or 5227, FY must be input.
    Doc. Code is 81, TC is 016. Do not input an FY unless it is intended that all subordinates are to have the same FY.
    FRC is for Form 5227, FYM must be 12.

3.13.12.6.30  (01-01-2015)
National Taxonomy of Exempt Entities Codes

  1. When inputting the National Taxonomy of Exempt Entities Code (NTEE) with CC EOREQ/EOCHG and the Document Code is 80 or 81:

    1. If Document Code is 80, the TC must be 000 or 016.

    2. If Document code is 81, the TC must be 016.

  2. For further information, see IRM 2.4, IDRS Terminal Input.

3.13.12.6.31  (01-01-2015)
Remarks

  1. When inputting the Remarks (RM) with CC EOREQ/EOCHG and the Document Code is 80 or 81, it is:

    • A required field for all EOCHG transactions.

    • Variable; i.e., it must be at least 10 but not more than 35 characters in length.

  2. Remarks should be written to leave a history for future reference.

3.13.12.6.32  (01-01-2015)
Filing Requirements

  1. Use TC 000, 012 or 016, Document 80, to add a positive FRC to the BMF. The validity and consistency checks will be performed when the input FRC is positive; i.e., greater than zero.

  2. To delete an EO FRC, use Document Code 80 or 63. If the input is only to delete a BMF FRC, use CC BNCHG. No definer code is necessary as long as the only change being made is to delete the FRC. However, if you are using CC EOCHG and the only action is to delete a FRC, the input must be as follows:

    1. Document Code must be 80.

    2. TC must be 016.

    3. Remarks must be input.

    4. Input zero in FRC being deleted

  3. Add 990 filing requirements as follows:

    1. If the 990 return indicates gross receipts greater than $50,000, update the 990 filing requirements to 990-01.

    2. If the 990 return indicates gross receipts less than $50,000, update the 990 filing requirements to 990-02.

    3. If there is no indication or unable to determine gross receipts, update the 990 filing requirements to 990-02.

    Note:

    Never use CC EOCHG to delete or update a Form 990-T, or a non-EO FRC, unless there is an EO Section already on the BMF, or you are adding an EO Section for the first time.

  4. Always input the fiscal year month if the FRC is for Forms 990, 990-C/1120-C, 990-PF, 990-T, 5227, 1041, 1065 or 1120.

3.13.12.6.32.1  (01-01-2015)
Form 941 FRC

  1. The validity and consistency checks for 941 FRC are as follows:

    1. Valid input codes are 00, 01 or 07.

    2. If Document Code is 80, the TC must be 000, 012 or 016.

3.13.12.6.32.2  (01-01-2015)
Form 940 FRC

  1. The validity and consistency checks for Form 940 FRC are as follows:

    1. Valid input codes are 0, 1, 2, or 7.

    2. If Document Code is 80, the TC may be 000, 012, or 016.

    3. If the FRC is 1 or 2, than a 941 FRC of 01 or a 943 FRC of 7 must be input.

    4. The Employment Code must NOT be W.

3.13.12.6.32.3  (01-01-2015)
Form 942 FRC

  1. If a Form 942 FRC is input, it must be 0.

3.13.12.6.32.4  (01-01-2015)
Form 943 FRC

  1. The validity and consistency checks for Form 943 FRC are as follows:

    1. Valid input codes are 0, 1, or 7.

    2. If the Document Code is 80, the TC may be 000, 012, or 016.

3.13.12.6.32.5  (01-01-2015)
Form 1120 FRC

  1. The validity and consistency checks for Form 1120 FRC are as follows:

    1. Valid input codes are 01, 03, 07, or 09.

    2. Fiscal year month must be input.

    3. If Form 1120 FR is 01, 03, 04, 07, or 09, then the TC must be 012 or 016.

    4. If the Status Code is not 41 or 70-72, then Transaction Definer Code A must be input.

    5. The subsection code must be input. The chart below shows the valid combinations of Form 1120 FRs. and subsection codes as well as any additional consistency checks.

    1120 FR SS CD 990 FR 990-PF FR 990-C FR TF CD
    01 03   1   03 or 04
    01 12 01      
    03 12 01      
    04 15 01      
              09 or 18
    09 01, 02, 04-23, 50, 60, or 70        

3.13.12.6.32.6  (01-01-2015)
Form 1065 FRC

  1. The validity and consistency checks for Form 1065 FRC are as follows:

    1. Valid input codes are 0 or 1.

    2. If Form 1065 FR is 1, then the Doc. Code must be 80.

    3. The TC must be 000, 012, or 016.

    4. If TC is 012 or 016 and SS is 02-23, 50, 60, or 70, then Transaction Definer Code A must be input.

    5. If the SS is 99, or is not entered, than the Status Code must be 07, 10 or 11.

3.13.12.6.32.7  (01-01-2015)
Form 1041 FRC

  1. The validity and consistency checks for Form 1041 FRC are as follows:

    1. Valid input codes are 0, 1, or 2.

    2. If Form 1041 FRC is 1 or 2, then the Document Code must be 80.

    3. Fiscal year month must be input.

    4. If the Status Code is not 41 or 70-72, then the Transaction Definer Code A must be input.

    5. If SS is 90, then the Form 5227 FR must be 1 or 2.

    6. If SS is 91, then the Form 990 FR must be 01 or 02.

    7. If SS is 92, then the Form 990-PF must be 1.

3.13.12.6.32.8  (01-01-2015)
Form 5227 FRC

  1. The validity and consistency checks for Form 5227 FRC are as follows:

    1. Valid input codes are 0, 1, or 2

    2. The Document Code must be 80.

    3. The Subsection Code must be 90.

    4. Fiscal year month must be 12.

    5. The TC must be 000, 012, or 016.

    6. If the TC is 012 or 016, the Definer Code A must be input.

3.13.12.6.32.9  (01-01-2015)
Form 990 FRC

  1. The validity and consistency checks for Form 990 FRC are as follows:

    1. Valid input codes are 01, 02, 03, 04, 06, 07, 13 or 14.

    2. If Form 990 FR is 01, 02, 03, 04, 06, 07 or 13, then the Document Code must be 80 or 81.

    3. If the Document Code is 81, the TC must be 016 and Definer Code must be D.

    4. If the Document Code is 80, the TC must be 000, 012 or 016.

    5. If the TC is 012 or 016, the Definer Code A must be input.

    6. The subsection code must be consistent with the 990 FR. The chart below shows the valid combinations of Form 990 FR and subsection codes as well as any additional consistency checks.

    990 FR SS Code Status Code Found Code Class Code
    01 02, 04-20, 22, 23, 24, 25, 50, 60, 70 or 91      
    01 03   09-18  
    02 02, 04-20, 22, 23, 24, 25, 50, 60, or 91      
    02 03   09-18  
    03 02, 04-20, 23, or 70      
    03 03   09-18  
    04 21      
    06 03   10  
    06 Must be in 99 or not input 07, 10 or 11    
    07 01 11    
    13 03   09-18 7
    14 01, 04-20, 22-25, 50, 60      
    14 03   09-18  

3.13.12.6.32.10  (01-01-2015)
Form 990-C/1120-C FRC

  1. See IRM 3.13.2.

3.13.12.6.32.11  (01-01-2015)
Form 990-PF FRC

  1. The validity and consistency checks for Form 990-PF FRC are as follows:

    1. Valid input codes are 0 and 1, 2, or 3.

    2. Fiscal year month must be input.

    3. The SS must be 03 or 92.

    4. If the SS is 03, then the Foundation Code must be 03 or 04.

    5. The TC must be 000, 012 or 016.

    6. If the TC is 012 or 016, then Definer Code A must be input.

3.13.12.6.32.12  (01-01-2015)
Form 990-T FRC

  1. The validity and consistency checks for Form 990-T FRC are as follows:

    1. Valid input codes are 0 and 1.

    2. Fiscal year month must be input.

    3. Document code will be 80 and the TC may be 000, 012, or 016.

    4. If a Form 990 FR is input, it must be 01, 02, 04, 06, 13 or 14.

    5. If the 990 FR is 00 or not input, then the 990-PF FR must be 1 or the Status Code must be 06.

    6. If TC is 000 and is the SS is input, it must be 02-25, 50 or 60.

    7. If TC is 000 and the SS in not input, then the Status Code must be 06, 07, 10 or 11.

    8. If TC is 012 or 016 and if the SS is 02-25, 50, 60 or 70, then Transaction Definer Code A must be entered.

    9. If TC is 012 or 016 and if the SS is 99, then the Status Code must be 06, 07, 10 or 11.

    10. If TC is 012 or 016 and if the SS is not entered, then the Status Code must be 06, 07, 10 or 11.

      Note:

      Re-insurance companies may file Form 990-T to report unrelated business income beginning in January 2011. If a form 990-T is submitted by a re-insurance company, the account should be placed into status 06.

3.13.12.6.32.13  (01-01-2015)
FRC – Not Required

  1. The validity and consistency checks for FRC - Not Required are as follows:

    1. Valid input codes are 0 or 1.

    2. NR is valid with Document Code 80 for TC 000, 012 or 016.

    3. If the TC is 016, then the Transaction Definer Code must be A.

3.13.12.6.32.14  (01-01-2015)
Form(s) 8038, 8038-G, 8038-GC and 8328

  1. Forms 8038, 8038-G, 8038-GC and 8328 are forms filed to report Tax Exempt Bond issues.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If these forms are received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

3.13.12.6.32.15  (01-01-2015)
Form 8038 - B

  1. Form 8038 - B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds, is filed by bond issuers to report information on Build America or Recovery Zone Economic Development Bonds.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If a Form 8038-B is received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

3.13.12.6.32.16  (01-01-2015)
Form 8038 - CP

  1. Form 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds, is filed by bond issuers to claim a credit.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If a Form 8038-CP is received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

3.13.12.6.32.17  (01-01-2015)
Form 8038 - TC

  1. Form 8038 - TC, Information Return for Tax Credit Bonds, is filed by bond issuers to report Tax Credit Bonds.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If a Form 8038-TC is received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

3.13.12.6.33  (01-01-2015)
BOD Code and BOD Client Code Changes

  1. Research CC INOLE or CC ENMOD to verify the Employment Code (EC) is correct. If the EC is not correct, make the necessary change using CC BNCHG.

    Note:

    The EC must be correct before a change to the BOD Code and BOD Client Code can be made.

  2. There are currently six BOD Client Codes (BCC).

    • B - Tax Exempt Bond (MFT 46 module only)

    • F - Federal/State/Local Government (F/S/L)

    • I - Indian Tribal Government (ITG)

    • 1 - Bond issued by ITG

    • 2 - Bond issued by F/S/L

    • 3 - Bond issued by an exempt organization

  3. The following table shows which BCC can be used with each EC:

    If the EC is Then the BCC can be
    C Blank
    I I or 1
    F F or 2
    G F or 2
    T F or 2
    W B or 3 or Blank
    Blank B or 3 or Blank

    Note:

    Numeric BCCs are systematically updated when an MFT 46 is posted to the account.

  4. To change the BOD Code or BOD Client Code:

    1. Input CC REQ77 with the EIN on the first line, MFT, plan number and tax period on the second line and the name control on the third line. For example:
      REQ77 12-3456789
      00 0000 000000
      ABCD

      Note:

      Since there is no MFT, plan number or tax period, zeros are entered on the second line.

    2. When the FRM77 screen appears, input data in the following fields:
      TC>971
      TRANS-DT>MMDDYYYY (current date)
      BOD-CD>TE
      BCC-CD>X (can be either alpha or numeric
      TC 971/151>050
      REMARKS> BOD BCC CHANGE

      Note:

      Both the BOD Code and the BCC must be entered on the same TC 971 even though the BOD Code may not need to be updated. A blank BCC is an exception.

3.13.12.7  (01-01-2015)
EO Consolidation of EINs

  1. IRM 3.13.12.7 contains procedures for consolidating accounts when an organization has more than one EIN and one or more of the EINs has an EO section on the BMF. These procedures must be followed whenever it is determined a taxpayer has more than one EIN.

3.13.12.7.1  (01-01-2015)
EIN Consolidation Procedures

  1. Entity Control will receive research, correspondence, returns, unpostables, etc. from various areas within the Service which indicate a taxpayer has more than one EIN.

  2. To consolidate two EINs, use CCs ENREQ/BRCHG, Document Code 63 and TC 011. Remarks must begin with the alpha’s SD to alert Files the IDRS transaction record must be associated with a source document. Use correspondence or prints as source documents.

  3. Before any account can be consolidated, perform complete research and have the lead sign off on the TC 011 before the transaction input.

    Note:

    No merge transcripts do not require lead approval for a TC 011.

    .

  4. If duplicate tax modules are present, input the TC 011, suppress CP 209 by entering a "Z" in the Para-Sel-CD field on the screen and send a 139C letter to the "TO" EIN.

    Note:

    Consolidation of an account with duplicate tax modules will generate a no merge transcript to Accounts Management. Do not send the case to Accounts Management requesting the duplicate modules be corrected.

  5. When determining which EIN to retain (" TO" number), use the following preference in this order:

    1. Retain the EIN preferred by the organization.

    2. If no preference is indicated, retain the lower EIN, unless one has a Form 941 FR.

    3. If both EINs have a 941 FRC, retain the lower EIN.

    4. If one EIN is not on the BMF, and the BMF EIN is still active, retain the BMF EIN.

    5. If the lower EIN is not active, retain the EIN which has active filing requirements.

    6. If neither EIN is active, retain the lower EIN.

  6. A CP 209 will generate to notify the organization of the correct number if the full consolidation was successful.

  7. Send a 139C letter to the organization only if requested.

  8. When reviewing BMFOL or ENMOD, use the following table to determine if a previous consolidation was initiated or if the account is inactive.

    Key to Generated Consolidated Transaction Codes
    Key to Input Consolidation Transaction Codes
    TC 001 Carries complete account of the old (FROM) TIN to the new TIN
    TC 002 Posts on the old (FROM) TIN and carries complete contents of the TC 001 carrier back to the original (FROM) TIN if name controls mismatch.
    TC 003 Posts on the old (FROM) TIN and carries the duplicate tax modules only back to the original (FROM) TIN and changes all filing requirements to 8's. Shows INACTIVE account on IDRS.
    TC 004 Posts on good (TO) TIN indicating duplicate module condition in attempted consolidation.
    TC 005 Posts on the new (TO) TIN and posts as an 005/006 combination if consolidation is successful.
    TC 006 Posts on the good (TO) TIN without the 005 if consolidation attempt is unsuccessful.
    TC 008 Post on the good (TO) TIN indicating a complete consolidation was made to the good TIN above.
    TC 026 Posts on the old (FROM) TIN. Account deleted. TIN changed.
    TC 011 Posts to the old (FROM) TIN to change EIN of an account on Master File and prevents other postings except 002, 003 and 026.
    TC 012 Account Re-established -- Active
    TC 020 Account Deleted -- Inactive
  9. Notify Cincinnati of an EIN change on an exempt organization if the organization's tax exempt determination is on an incorrect EIN.

3.13.12.7.2  (01-01-2015)
Conditions for No Merge

  1. Figure 3.13.12-43 in IRM 3.13.12.8.1 shows the conditions which can cause a no merge transcript and should be used to determine if the two EINs can be consolidated.

    1. If any of the transactions listed on the chart are identified during review, do not input the TC 011 until the condition is corrected on the BMF.

    2. Correct either the EIN that is identified to be the "FROM" account or the EIN identified to be the "TO" account.

    3. Remember always correct the accounts so after the consolidation the "TO" account will have the proper organization identification of filing requirements, EO section, FYM, etc.

  2. If only one account has an EO section, the Master File will retain the EO section from either number.

  3. If both accounts have an EO section, retain the "TO" account, unless the "TO" account does not have a subsection code greater than zero and the "FROM" account has a subsection code greater than zero; then retain the "FROM" account EO section.

  4. Notify Cincinnati of the EIN change if the EIN of the organization changes.

3.13.12.7.3  (01-01-2015)
Merge Checks

  1. If both accounts have an EO section with an EO status, the BMF will perform the following merge checks. If the checks fail, a "NOMRG EO" transcript will be generated.

  2. Merge checks on the subsection (SS):

    1. If both accounts have a subsection code, they must be the same, unless one account has a SS of 00. If one account has a SS of 00, then the Master File will retain the EO section with the SS greater than zero.

    2. Before inputting a TC 011, correct the EO section that is wrong.

    3. A TC 022 may be input to delete the EO section on the account that is wrong. However, see UPC 359 in IRM 3.12.278 for TC 022 unpostable conditions.

    Note:

    TC 022 MUST be input prior to TC 011 when the account reflects Status Code 40 or Status Code 40 must be updated to match the EIN with a good determination. Input of TC 022 will remove the account from the Status 40 process.

  3. The following table shows the EO entity status which must be present so the accounts can be merged.

    Status Code"From" Module Status Code "TO" Module
    01 - 03 01 - 03
    7, 10, 11 7, 10, 11
    12 12
    18 18
    19 19
    20, 22 - 26 20, 22 - 26
    21 21
    28 28
    29 29
    30 30
    31 31
    32 32
    33 33
    34 34
    35 35
    36 36
    40 40
    42 42
    41, 70 - 72 41, 70 - 72
  4. Merge checks on the GEN:

    1. If both accounts have a GEN, they must be the same. Be sure the two accounts are the same before trying to correct the GEN.

      Examples:
      Account #1 has a GEN and Account #2 has an EO section with no GEN. These accounts will not merge because the GENs are not the same.
      Account #1 has a GEN and Account #2 has a different GEN. These accounts will not merge because the GENs are not the same.
      Account #1 has no GEN and Account #2 has no GEN. These accounts will merge because the GENs are the same.
      Account #1 has a GEN and Account #2 has the same GEN. These accounts will merge because the GENs are the same.
  5. Merge checks on the Affiliation Code:

    1. The only condition which will cause a merge to fail is when Account #1 has an AF of 7 or 9, and Account #2 has an AF of 6 or 8. You cannot merge a parent to a subordinate or a subordinate to a parent.

    2. Never input a TC 022 to the account with an AF of 6 or 8.

  6. Merge checks on the fiscal month: The fiscal months must agree. Correct the FYM on either account to agree with the posted return tax period month.

3.13.12.8  (01-01-2015)
EO Transcripts and Notices

  1. AMS uses Desktop Integration (DI) to electronically deliver Entity transcripts on a weekly or monthly basis replacing the printed paper forms. The data is extracted and sorted by a computer program and cases are loaded into the DI system as inventory items. The DI system will automatically assign inventory cases to employees based on their skill codes and the number of cases in inventory. The Entity manager, lead or clerk may also manually assign transcript inventory to employees in their unit.

  2. Assigned and unassigned cases will reside on DI. The reports to track Entity's transcript inventories are also available on DI.

  3. AMS allows authorized users to resolve various taxpayer issues by providing the IRS employee the ability to view and update taxpayer accounts and case information through a common user interface. AMS can be used for may taxpayer actions and can be used whether the taxpayer's account resides on IDRS or CADE.

  4. Entity tax examiners can complete the following actions using DI/AMS:

    • Research the taxpayer account

    • Activate up to 30 self-elected IDRS Command Codes

    • Launch into external IRS system without leaving DI

    • Electronically record, store and retrieve nationwide case history

    • Update taxpayer address and phone numbers

    • Order forms

    • Prepare specific forms and transcripts

    • Create selected IDRS Correspondex letters

  5. AMS will become the remaining system/process (beginning in 2009) which will incorporate the capabilities of Desktop Integration and Correspondence Imaging System (CIS).

  6. The types of taxpayer information, correction methods, and research capabilities will continue to increase with each subsequent AMS and CADE enhancement. AMS is planning on replacing IDRS by 2012.

  7. Work all EO transcripts using the procedures outlined in IRM 3.13.12.

  8. All EO related transcripts include the following EO information. The inclusion of this information on the transcript will eliminate the need for additional EO research requests previously necessary to resolve the case.

    Title Print Format
    EO Entity Status EO–STAT–nn–YYYYMM
    Ruling Date RUL–YYYYMM
    Classification Code CLASS–nnnn
    Affiliation Code AFF–n
    Income Code INC–n
    Foundation Code FOUN–nn
    Group Exemption Number GEN–nnnn
    Type of Organization ORG–n
    Asset Code ASSET–n
    Subsection Code SUB–nn
    File Folder Number FFN–nn–nnnnnnn

3.13.12.8.1  (01-01-2015)
General Instructions for EO Transcripts

  1. General Instructions for EO related transcripts. The table below shows EO NO MERGE Conditions.

    Name Reason Code Definition
    Name Control 30 Different Name Controls will not merge. A CP 201 will generate
    Filing Requirements 33 Incompatible FRs will not merge. A CP 202 will generate. If the "TO" account is all 8s (Inactive account), a CP 200 will generate.
    EIN NOMRG - FYM   Different FYMs will merge on a BMF merge, but entities with EO submodules require them to be the same MCC Transcripts are generated.
    Subsection NOMRG - SS 22 Different subsections will not merge. However, if one entity has a subsection and the other is blank, they will merge. MCC Transcripts are generated.
    GEN NOMRG - GEN 24 Different GENs will not merge. If one module has a GEN, the other module mush have the same GEN. MCC Transcripts are generated.
    STATUS NOMRG - STAT 23 All status conditions will not merge. An information table on status merges is shown in 3.13.12.7.3(3). MCC Transcripts are generated.
    Affiliation Codes NOMRG - AF 25 Parents and subordinates should not be consolidated. An affiliation code of 6/8 will not merge with a 7/9. MCC Transcripts are generated.
    1. Perform research on all cases to determine if a true error was made, or if an error was made in transcribing the information.

    2. If the error was in transcription, make the necessary entity change following normal procedures.

    3. If a true error exists, research EDS for an open case. If there is an open case, telephone the determination agent assigned to the case. Inform the agent of the discrepancy. If necessary, forward the case to the agent assigned to the case. Notify the organization of the transfer of the case.

    4. If there is no open case on EDS, research IDRS (CC INOLE, CC BMFOLO, CC BMFOLE). If the amended organizing documents were submitted.

    5. If the amended organizing documents were submitted, send the documentation to Cincinnati campus. The notation on the Form 3499 should state "Establish as a T (termination) or A (amendment) case."

    6. If the amended organizing documents were not submitted, advise the organization of the information needed to merge the account. Request the organization send the documents to Cincinnati campus.

3.13.12.8.2  (01-01-2015)
EO No Merge Transcripts

  1. The following transcripts are generated when an attempt to merge accounts containing EO data fails:

    • NOMRG - SS

    • NOMRG - STAT

    • NOMRG - GEN

    • NOMRG - AF

    • NOMRG - FYM

  2. No merge transcripts do not require lead approval for a TC 011.

3.13.12.8.2.1  (01-01-2015)
NOMRG - SS

  1. NOMRG - SS transcript is generated when the current subsection codes are different. (RC22)

    1. Research EDS to determine if the subsection code was recently changed. If the SS was changed, request the source document to determine if the change was made correctly. If the "FROM" and "TO" accounts are the same entity, input a TC 016, Doc. Code 80, to update the subsection code and re-input the merge transaction.

    2. If it appears each account has a valid subsection code, follow the general instructions above.

3.13.12.8.2.2  (01-01-2015)
NOMRG - STAT

  1. NOMRG - STAT transcript is generated when the "FROM" and "TO" accounts have incompatible EO status codes. (RC23)

    1. For incompatible status codes, see UPC 358 in IRM 3.12.278.19.

    2. Perform necessary research and make necessary changes as indicated in paragraph 12.17.2.1(1) above.

3.13.12.8.2.3  (01-01-2015)
NOMRG - GEN

  1. NOMRG - GEN transcript is generated when both accounts have EO status and an attempt is made to merge accounts with different GENs. (RC24)

    1. Research CC EOGEN to determine the correct GEN. Input a TC 016, Doc. Code 80 to change the GEN when the correct GEN can be determined.

    2. If the correct GEN cannot be determined, the accounts may be different entities. One entity could be a new parent that was being erroneously merged with a subordinate. Follow the general instructions above.

3.13.12.8.2.4  (01-01-2015)
NOMRG - AF

  1. NOMRG - AF transcript will generate when one account has an affiliation code of 6 or 8 (parent) and the other account has an affiliation code of 7 or 9 (subordinate). (RC25)

    1. Perform all necessary research on EDS or IDRS and make changes as required.

    2. If the NOMRG condition cannot be resolved, follow the general instructions given above.

3.13.12.8.2.5  (01-01-2015)
NOMRG - FYM

  1. NOMRG - FYM transcript generates when the fiscal month for the two accounts do not agree.

    1. Research the "TO" TIN to ensure the correct number was used.

    2. If the correct "TO" TIN was used, determine the correct FYM by examining the posted returns. Use the FYM of the latest posted return for the account FYM.

      Note:

      The FYM match is performed prior to the filing requirement match. Therefore, you must be sure the FRs. of each account are compatible.

    3. After determining the correct FYM, input TC 016, Doc. Code 63 to correct the inaccurate account.

    4. If the filing requirements are mismatched, refer to CP 202 instructions in IRM 3.13.12.8.3.3 and resolve accordingly.

    5. After the FYM (and FR, if necessary) is corrected, input TC 011, Doc. Code 63 to complete the consolidation.

    6. If the correct "TO" TIN was not used, research to determine if a good "TO" TIN exists.

    7. If the proper "TO" TIN is found ensure all items (FYM, FR) are compatible. Correct if necessary, then input TC 011, Doc. Code 63 to consolidate the accounts.

    8. If you cannot find a good "TO" TIN, destroy the transcript with no further action.

3.13.12.8.3  (01-01-2015)
No Merge Notices

  1. No Merge Notices (CPs 200, 201 and 202): Entity Control will receive these notices resulting from an attempted consolidation. These notices include the following EO information. The inclusion of this information on the notice will eliminate the need to research for EO information necessary for resolution of the case.

    Title Print Format
    EO Entity Status ST–nn–YYYYMM
    Ruling Date RUL–YYYYMM
    Affiliation Code AF–n
    Foundation Code TF–nn
    Group Exemption Number GEN–nnnn
    Subsection Code SS–nn
    File Folder Number FFN–nn–nnnnnnnn
    Classification Code CL–nnnn

3.13.12.8.3.1  (01-01-2015)
CP 200

  1. CP 200 "TIN CHANGE - INACTIVE ACCOUNT" is generated when a consolidation of accounts is attempted and the "TO" account is inactive; i.e., all filing requirements are "8" .

  2. Entity Control will receive these CP 200 notices and process as follows:

    1. Research the entity using CCs NAMEE/NAMEB and INOLE to verify the accounts are the same.

    2. If the accounts appear to be the same, request research using CCs BMFOL, MFTRA, MFTRD for an entity transcript of both the "FROM" and "TO" number.

    3. If research show the accounts are the same, determine why the account is inactive by the transactions posted to the entity module. A TC 020 and a partial merge TC 011 and 003 combination will place 8s in the FRCs.

    4. Do not reactivate an account when a TC 011 and 003 created the inactive status, unless telephone contact with the organization is made. Try to convince the organization the active number is correct. However, if the taxpayer insists on having the number which is inactive, take the necessary action to correct the BMF and redo the consolidation.

    5. To reopen the account, use TC 012 and the appropriate FRC.

    6. If the accounts are not the same, forward the case and all the research to the originator of the consolidation, if they can be determined. Explain the reason the case is being forwarded. If the originator cannot be determined, destroy the case.

3.13.12.8.3.2  (01-01-2015)
CP 201

  1. CP 201, TIN CHANGE - NAME CONTROL MISMATCH is generated when a consolidation of accounts is attempted and the Name Controls do not match. Entity will receive these notices and process as follows:

    1. Perform appropriate research to determine if these accounts are for the same entity. If an error was made in transcribing the data, initiate a TC 011, Doc. Code 63 with correct data.

    2. If no error was made and it is clearly determined the accounts should be consolidated, input a TC 013 to change the name control, as required. If it's a BMF account, use Doc. Code 63; if it's an EO account, use Doc. Code 80. Also, input a TC 011 to consolidate the accounts and delay one cycle.

    3. If one account has a temporary TIN and the accounts are the same, input TC 013 to correct the name of the account which is incorrect. If the accounts are BMF, use Doc. Code 63; if the accounts are EO/BMF, use Doc. Code 80. After the TC 013 has posted, input TC 011, Doc. Code 63. Use the account with the temporary number (00–2xxxxxx) as the "FROM" account.

    4. If one account has a temporary TIN and the accounts are not the same entity, research for another number (TIN). Be sure to include EDS in your research if EO is indicated. If another TIN is found, input TC 011 using the temporary TIN as the "From" number. If another TIN is not found, use CC ESIGN, MFI O, and NID to assign another (new) number to the account with the temporary TIN. If there is an open case on EDS, input the case control number. Input TC 011 with the temporary number as the "FROM" number.

    5. If it cannot be clearly determined how to consolidate the accounts, reject the Request for Consolidation (computer generated Form 5147 or Form 2363) with the CP 201 to the originator on a memo routing slip. Request additional information to verify the consolidation. If sufficient information is received, change the name (TC 013). Input TC 011 to consolidate the accounts.

    6. If consolidation cannot take place, destroy the notice.

3.13.12.8.3.3  (01-01-2015)
CP 202

  1. CP 202, E.I. NUMBER CHANGE - FILING REQUIREMENTS MISMATCH is generated when a consolidation of accounts is attempted and the accounts have conflicting filing requirements for income returns. For example, the consolidation would result in a combination of Form 1120-C and Form 990, Form 990-PF and Form 1041-A, or Form 1120 and Form 990-T filing requirements.

    1. Determine the correct filing requirements through IDRS and additional research as necessary.

    2. If a Form 1120S is involved (Form 1120 FR of 02), correspond with the organization if one account has an unreversed TC 090 present on BMFOLE and the other account has a Form 990 FR. It will be necessary to determine from the taxpayer which FR is correct.

    3. When information reveals the filing requirement on one of the accounts is erroneous and the consolidation of the accounts should be made, coordinate with BMF Entity to reverse the TC 090, and then input a TC 016 to correct the filing requirements. Also, input and cycle delay a TC 011 to consolidate the accounts and delay two cycles.

    4. When information reveals two different entities are involved and the consolidation should NOT be accomplished, review both accounts. Correct name lines as applicable.

  2. Refer to table below to determine incompatible filing requirements:

    Filing Requirement Code & MFT Incompatible Filing Requirements & Filing Requirement Code
    02 (1120) 1041, 1065, 706GS(T), 1041-A, 5227, 1066
    990-C/1120-C (FRC = 1 unless F1120 FRC = 07)
    990-T (FRC = 1 unless F1120 FRC = 03, 04 or 09)
    990-T (FRC = 2)
    990-PF (FRC = 1 unless EO Entity Status = 19 or 22)
    990 (FRC = 03 or 07)
    990 (FRC = 04, 06 or 13 unless F1120 FRC = 09)
    990 (FRC = 01 or 02 unless F1120 FRC = 01 and EO subsection = 12 or 15 or F1120 FRC = 03, 04 or 09)
    8752 (unless F1120 FRC = 02)
    05 (1041) 1120, 1065, 990-C, 1120-C 990-T, 1066, 8752
    990 (FRC = 03 - 07)
    990 (FRC = 01 - 02 unless EO Subsection = 91)
    990-PF (unless EO Subsection = 92)
    06 (1065) 1120, 1041, 1066, 990-C, 1120-C, 990–T, 1041-A, 5227, 4720 990-PF, 706GS(T)
    07 (1066) 1120, 1065, 1041, 8752, 990-C, 1120-C, 990-T, 1041-A, 5227, 4720, 990-PF, 990, 942, 706GS(T)
    15 (8752) 1041, 1066, 990-C, 1120-C, 990-T, 1041-A, 5227, 706GS(T) & 1120 (unless FRC = 02)
    33 (990-C 1120-C) 1041, 1065, 1066, 8752, 990-T, 1041-A, 5227, 4720, 990-PF, 990, 942, 706GS(T), 1120 (unless FRC = 07 and 990-C 1120-C FRC = 1)
    34 (990-T) 1041, 1065, 1066, 8752, 990-C, 1120-C, 1041-A, 5227, 706GS(T), 990 (FRC = 03), 1120 (FRC = 01, 02, 06, 07, 10, 11 or 14 - 19)
    36 (1041-A) 1066, 8752, 1120, 1065, 990-C, 1120-C, 990-T, 990-PF, 990
    37 (5227) 1120, 1065, 1066, 8752, 990-C, 1120-C, 990-T, 990-PF, 990, 1041, 706GS(T) (unless EO Subsection = 90)
    44 (990-PF) 1065, 1066, 8752, 990-C, 1120-C, 1041-A, 5227 990
    1120 (FRC = 01 unless EO Entity Status = 19 or 22)
    1120 (FRC = 02, 06, 10, 11 14 - 19)
    1041/706GS(T) (unless EO Subsection = 92)
    990-T (FRC = 02)
    50 (4720) 1065, 1066, 8752, 990- C, 1120-C
    1120 (FRC = 02, 06, 07, 10 or 11)
    990 (FRC = 03)
    67 (990) 1065, 1066, 8752, 990-C, 1120-C, 1041-A, 5227, 990-PF
    1120 (FRC = 02, 06, 07, 10, 11, 14 -19)
    1120 (unless FRC = 09 and SS - 15)
    1041/706GS(T) (unless EO Subsection = 91)
    1120 (FRC = 01 unless 990 FRC = 01 or 02 and EO Subsection = 12)
    990-T (FRC = 02)
    990-T (Subsection = 91)
    77 (706GS(T)) 8752, 990-C, 1120-C, 990-T, 1066, 1120, 1065
    990 (FRC = 3, 04, 06, 07, 13)
    990 (FRC = 01 or 02 unless EO Subsection = 91)
    990-PF (unless EO Subsection = 92)

3.13.12.9  (01-01-2015)
EO Unprocessable Returns and Documents

  1. In order for a return or document to be processable, it must have:

    • A TIN,

    • A legible name or name control,

    • A valid tax year ending, and

    • legible tax data.

  2. Returns and documents which do not meet the above requirements are called unprocessable returns or documents. "Unprocessables" received by Entity Control do not have a TIN or show a changed TIN or name.

  3. See IRM 3.30.123, Processing Timeliness: Cycles, Criteria, and Critical Dates, for Entity Control's processing time frames for unprocessable returns. All Forms 990-T, 990-PF and 5227 not processed by Program Completion Date (PCD) must have a TC 599 cc 018 input to prevent return delinquency investigations. Input of this transaction code must be completed three weeks prior to each return's delinquency check. See the delinquency check schedule in IRM 3.30.123 - Exhibit 13 for the cycle of each form's delinquency check.

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

  5. Original returns and documents which are unprocessable will be received from:

    • Receipt and Control,

      Exception:

      A tax examiner from Entity will go to the Deposit Activity in Receipt and Control 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 in Accounting.

    • Document Perfection (unnumbered returns), and

    • Rejects (IDRS Control)

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

    • Document Perfection,

    • Error Correction, and

    • Rejects.

  7. EO returns will error when the input name control does not match the name control on the Entity Index File (EIF). Error Correction or Rejects will perform research to determine if the organization is using the correct EIN.

  8. To make unprocessable returns processable, it may be necessary to edit entity information on the return. Refer to IRM 3.11.12 Exhibits for the placement of the edited information on each specific return.

    1. For Form 990, see Exhibit 3.11.12-1.

    2. For Schedule A, see Exhibit 3.11.12-2.

    3. For Form 990-EZ, see Exhibit 3.11.12-4.

    4. For Form 990-PF, see Exhibit 3.11.12-9.

    5. For Form 990-T, see Exhibit 3.11.12-12.

3.13.12.9.1  (01-01-2015)
General Instructions for Processing Documents from ERS or Rejects

  1. If Error Correction or Rejects determines the EIN is for the same organization, but the Exempt Organization is not name controlled properly, a copy of the first page of the return and any research will be forwarded to Entity Control. Process the photocopy of the return as follows:

    1. Compare the way the organization shows the name on the return with the name as shown on BMF.

    2. If the name control on the BMF is not according to acceptable name control procedures, input the correct name control to update the BMF.

    3. If 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.

    4. If there are misspelled names on the BMF, input the changes in the correct name line fields to correct the BMF.

    5. If it is obvious the BMF is correct, destroy the photocopy of the return and take no action.

    6. If appears a name change has occurred, correspond with the taxpayer, informing them documentation is required before we can make the name change. See IRM 3.13.12.6.2.2 for more details on what type of documentation is required for each type of organization. If the taxpayer responds with the required information, input TC 013, Doc. Code 63, and send the organization a 252C Letter acknowledging the change to its name. If the taxpayer does not provide the necessary documentation or fails to respond, do not make the name change. Destroy the photocopy received from Error Correction or Rejects.

  2. If ERS is unable to determine the correct EIN to post a TC 610 payment from Form 3224E (RRPS Electronic Payment Voucher), research CC NAMEE and CC NAMEE/NAMEB. If the correct EIN is still not found, attempt to phone the bank or the organization based on the information given on the check. When the correct EIN is found, notate it on the document and send it back to ERS.

  3. Other reasons Rejects or ERS will refer copies of the return to Entity are:

    • 2 EINs

    • Missing EINs

    • Address changes

    • Incorrect subsection

    • Incorrect FYM

  4. After the changes are input, notify the Exempt Organization with a 252C letter if a change is made to the organization's name. If a correct EIN is found, notify the organization, using Letter 3910C.

    Note:

    Obvious transposed or missing digits can be excluded as criteria for sending the Letter 3910C.

3.13.12.9.2  (01-01-2015)
General Instructions for Processing Documents from Document Perfection

  1. Returns with no entity data; i.e., name, EIN, SSN, may be forwarded to Entity from Document Perfection.

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

    2. Use available resources to locate a valid telephone number for the name secured. Contact the organization, and, if sufficient information is provided, perfect the return and continue processing.

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

  2. Process Forms 8872 as follows:

    If Then
    There is no EIN, Research for an existing EIN.
    An existing EIN is found,
    1. Send a 3910C Letter to the organization to notify them of their correct EIN.

    2. Send the Form 8872 to Imaging.

  3. Entity Control will receive EO returns and documents if they contain a change to "Organization Name" , have a missing EIN or do not have an EO section on the BMF (UPC 366). Each return will be treated separately within this section.

  4. Always input TC 599 cc 018 if return is past due. A return is considered timely if filed by the due date or the extended due date. ( Extended due date is identified by approved TC 460 date.) See the following chart for return due dates.

    Exception:

    Do not input TC 599 cc 018 if the account is in Status 40. Always input TC 599 cc 018 if the return is a Form 1120, regardless of the due date. Do not input TC 599 cc 018 on a final return if the return FY is different from the BMF FY.

    Statute Returns Date Due, or # of months due after the end of the accounting year
    990-BL, 990-C/1120-C, 990-PF, 990-T, (IRC 401/408) 990-T (all others) 1120-POL, 4720, 5227, 6069 4.5 months 8.5 months 4.5 months 3.5 months 4.5 months 2.5 months same as 990, 990-EZ, 990-PF April 15th 4.5 months
    Non-Statute Returns Date Due, or # of Months Due After the End of the Accounting Year
    990, 990-EZ, 990-BL w/o Sch A 1041-A, 5578, 5768, 8282 4.5 months 4.5 months 4.5 months April 15th 4.5 months any time within 125 days of disposition

3.13.12.9.3  (01-01-2015)
General Instructions for Processing Documents or Returns from Cincinnati

  1. The EO Entity Unit sends returns and documents to Cincinnati for resolution. When Cincinnati returns these documents to Entity with resolution instructions indicated, process as follows:

    1. Perform actions indicated by Cincinnati.

    2. If a return is unpostable and needs to be processed, prepare Form 3893 to recreate the original DLN on SCCF. Send the Form 3893 and the return to Data Control Unit in the Accounting Branch.

3.13.12.9.4  (01-01-2015)
Form 7004

  1. See IRM 3.13.2 for processing instructions.


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