3.14.2  Notice Review - Business Master File (BMF) Notice Review (Cont. 1)

3.14.2.7 
Tax Examiner Review Procedures

3.14.2.7.1 
General Review Procedures

3.14.2.7.1.4 
Offsets

3.14.2.7.1.4.1  (01-01-2015)
Credit Elect-TC 830/TC 710 and 836/TC 716

  1. Review the return to decide if the taxpayer requested that all or part of their overpayment be applied to the subsequent tax period.

    Caution:

    If any balance due module contains an -E Freeze, do not manually offset credit to satisfy the module. Transfer the credit elect as requested by the taxpayer.

  2. When the request is transcribed properly from a current period return, the computer will automatically offset the credit (TC 836/716) if it is available.

    Caution:

    If credit elect is $ .99 or less the amount will not be automatically offset by the computer. In this instance the tax examiners do not have to manually transfer the credit.

  3. If the full amount of the credit is not available when the return posted:

    1. For Form 1041, Form 1120, Form 1120-C, Form 990-T, and Form 990-PF, the computer continues to offset as more credit becomes available until the full credit elect amount is satisfied. This capability only exists up to one year after the original tax period ending date.

      Example:

      Up to December 31, 2012 for a 201112 tax return.

    2. For Form 940, Form 941, Form 943, Form 944, Form 945, Form 720, Form CT–1, and Form 1042 the computer will not offset additional credit elect after the return posting cycle. A manual credit elect transfer must be input for subsequent offsets on these forms. (Input CC ADD48 on IDRS using TC 830/TC 710.)

  4. The following notices pertain specifically to Credit Elect situations:

    1. CP 147 – will only generate on an income tax return. It is issued when additional credit(s) become available and are computer offset.

    2. CP 145 – must be pulled and associated with the case when adjusting an account if the credit elect will be affected.

  5. Forms 940, 941, 943, 944, and 945 - When the refund box is checked, Integrated Submission and Remittance Processing (ISRP) System or Data Input System (DIS) will input a Refund Indicator, which generates the Computer Condition Code S at posting. When neither box is checked or the Applied to Next Return box is checked, the refund indicator is not input, Computer Condition Code E generates at posting, and the overpayment is applied to the next return (credit elect). Follow the instructions below: (01/06)

    1. Verify that the entries match the Computer Condition Code posted to the notice module.

    2. If there is an overpayment on the account that will refund, and any of the following occur, apply the credit elect using (6) below:

      • Neither of the boxes are checked.
      • The return is not available.
      • The Computer Condition Code E is present on the notice module.

  6. If the Data Transcriber did not properly transcribe the Credit Elect request and the credit is refunding:

    1. Delete the refund.

    2. Use CC ADD48 to manually transfer the Credit Elect amount as a TC 830/TC 710. Be sure to use posting delay codes to allow time for the TC 841 to post to the module before the TC 830 posting.

    3. Monitor the case until the TC 841 posts.

  7. For Forms 941 and 944, if the taxpayer entered the credit elect or total FTD credits on the Advanced Earned Income Credit line in error and an erroneous TC 766 credit is present, delete the refund. Adjust the TC 766, using CC REQ54 on IDRS. Manually transfer the claimed credit elect if not already offset by the computer.

  8. Master File will not automatically offset requests for Credit Elect on prior year income tax returns and/or subsequent requests on all non-income tax returns.

    1. Use CC BMFOL to review the subsequent period.

    2. Manually input all subsequent credit elects on all prior year returns.

      Caution:

      Never transfer Credit Elect from a module with an expired RSED.

    3. Transfer claimed Credit Elect directly to a module separated by more than one tax period (e.g., 2006 to 2009), if all of the modules in between claim the same Credit Elect, are settled modules, and no penalties or interest will abate. Use the correct dates and an Override Code "2" on the Doc Code 48 transfer.

    4. All other offsets (TC 826 or 896) have priority over a Credit Elect offset. Only reverse one of these offsets in favor of a credit elect when a TC 826 offsets to the subsequent period, and penalties and interest will decrease if a timely credit elect posts.

    Credit Elect and Credit Offset Decision Table
    If any of the following occurs: Then
    1. The subsequent tax period has a balance due 1. Delete the refund.
    2. The credit elect will cause penalties and interest assessed on the subsequent period to partially or fully abate 2. Retype the settlement notice or void the CP 145.
    3. Taxpayer claimed the credit on the subsequent tax period and the Credit Elect field on the subsequent module has a significant amount 3. Manually offset the Credit Elect.
    4. Otherwise 4. Allow the refund.
  9. When increasing tax or reversing credits on the notice module, reverse all or part of a notice cycle credit elect to cover the debit. Input CC ADC48 using TC 832/712 on IDRS.

    1. Delete any current cycle refund on the subsequent module. Reverse the offset using a posting delay code to allow time for the TC 841 to post before the TC 712.

    2. Do not reverse a credit elect that was offset in a different cycle from the notice cycle.

      Example:

      If the notice generated in cycle 200415 and the TC 836 posted in cycle 200408, do not reverse the TC 836.

    3. Retype the original notice to include the CP 145. If a notice can not be mailed take no action.

  10. If the Credit Elect from the prior year module (TC 716) was intended for another account, use CC ADD48 to transfer the credit with a TC 712/TC 710:

    1. Use the TC 716 date as the TC 712 date

    2. Use the date the credit was originally available as the TC 710 date.

    3. Reverse a TC 826 offset if there is a pending manual credit transfer

  11. When manually transferring Credit Elect, input TC 830/TC 710:

    1. If all payments or credits are timely ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , use the due date of the return as the 830/TC 710 date. Otherwise, use the date of the credit creating the overpayment as the TC 830/TC 710 date.

      Exception:

      For Form 1120, the TC 830/836 date is the RDD plus one month. For example: on a 201112 return the due date is 03152012 and the TC 830/836 date is 04152012.

      Note:

      Multiple TC 830's may need to be input depending on the date the credit is available. Always transfer the most recent credits first.

    2. If a tax adjustment or credit transfer creates, or is a part of the overpayment, time the offset (TC 830) to post after the adjustment or credit transfer, by inputting a Posting Delay Code (See Use of Posting Delay Codes Table).

      Note:

      Timing the actions will allow all of the transactions to post and will prevent unintentional refunds and unpostables. If the required overpayment amount is not available, the computer will resequence the TC 830 for one cycle. The exact amount of credit must be available or the TC 830 will unpost.

      Reminder:

      An adjustment notice will generate the same cycle as a penalty reversal if a Failure to Deposit (FTD), Failure to File (FTF), Failure to Pay (FTP) (decrease only) or Estimated Tax (ES) Penalty recomputes.

      Use of Posting Delay Codes
      If Then
      The penalty or interest will recompute because of an adjustment action.

      Note:

      If penalties and interest will not recompute, the Posting Delay Code on the TC 830 is not required.

      Use appropriate Posting Delay Codes to time the transactions to post in the following order:
      1. Adjustment or credit transfers and TC 290 .00 adjustments, if preventing an adjustment notice.

        Note:

        When inputting a credit transfer follow instruction in IRM 3.14.2.7.20

      2. The TC 830.

      3. The TC 571, if required.

        Caution:

        Check prior periods for debit modules before inputting the TC 830/TC 710. If no E Freezes are present, manually offset applicable credit to the debit module(s) with the earliest CSED(s) before applying forward. Use TC 820/700 with CC ADD24. Time the transaction to post in the same cycle as the TC 830/TC 710.

      A Doc Code 34 credit transfer will create the overpayment, use a Freeze Code 1 on the transfer.
      1. Input TC 290 .00, Hold Code 4, appropriate Posting Delay Code, if the adjustment notice must be suppressed. See Note below.

      2. Input TC 830/TC 710, Doc Code 48, appropriate Posting Delay Code on the debit side of the transfer.

      3. Release module freeze , appropriate Posting Delay Code to post after the TC 830 if there is remaining credit that must refund.

      A Doc Code 24 or 48 credit transfer will create the overpayment, use a TC 570 on the credit side of the transfer.
      1. Input TC 290 .00, Hold Code 4 if the adjustment notice must be suppressed. See Note below.

      2. Input TC 830/TC 710 with Doc Code 48.

      3. Release module freeze , appropriate Posting Delay Code (to post after the TC 830) if there is remaining credit that should refund.

      A Doc Code 54 adjustment will create the overpayment, use Hold Code 4 on the adjustment. Input the TC 830/TC 710 on a Doc Code 48.

      Reminder:

      The TC 830 will release any remaining credit on the module when Hold Code 4 is used.

      Note:

      A Hold Code 2 or 4 can also be used to suppress the notice and used in place of the Hold Code 3 when preventing an adjustment notice resulting from a Doc Code 34 or 24 or 48 credit transfer input with TC 570. (The Hold Code 4 will not create a -K Freeze when input in the same cycle as the Doc Code 24, 34, or 48 credit transfer. TC 570 input on the credit side of the transfer is required to hold the credit) .

    3. Decide the correct notice disposition:

      Credit Elect Notice Disposition
      If And Then
      The CP 145 or settlement notice with the Credit Elect pop-in paragraph will be mailed to the taxpayer. Master File cannot systemically offset the additional Credit Elect. 1. Manually transfer the Credit Elect (see above).
      2. Use label #7 to reflect the credit elect.
      Master File can systematically offset the additional Credit Elect. 1. Let Master File offset the credit. Do not input a TC 830/TC 710.
      2. Use Label #2. Allow the CP 147 to generate.
      All of the requested Credit Elect amount has now been applied. A CP 145 generated. Void the CP 145.
      A settlement notice generated with the Credit Elect pop-in paragraph. Retype the notice to exclude the pop-in paragraph or void if returning to taxpayers original figures.
      The total Credit Elect applied is still less than the taxpayer’s figures. A CP 145 generated. Retype the CP 145.
      A settlement notice generated with the Credit Elect pop-in paragraph. Retype the notice to correct the dollar amounts in the pop-in paragraph.
  12. Keep the following in mind when manually transferring Credit Elect:

    1. Use an Override-Date Indicator 2 on both sides of a Doc Code 48 if the debit and credit transaction dates are different.

    2. Use the date of the credit being reversed as the reversal transaction date.

    3. Do not transfer Credit Elect for an amount exceeding the available credit on the module.

    4. Do not transfer Credit Elect with a transaction date earlier than the due date of the return.

    5. Do not transfer Credit Elect with a transaction date earlier than the credit or payment that created the overpayment.

3.14.2.7.1.4.2  (01-01-2015)
Lump Sum Credit Offset-TC 826/706 and 820/700

  1. Master File offsets available credit (with a TC 826/706) to an account on which a taxpayer has a balance due. A notice will generate to tell the taxpayer of the offset:

    Note:

    This offset to a debit account has priority over a requested Credit Elect except when an -A Freeze is present.

  2. CP 138 generates when an overpayment offsets to another tax liability.

  3. Use a Doc Code 24 credit transfer with a TC 701/821 to reverse an offset to a tax liability. Include a TC 570 on the credit side (TC 821) if the credit must be held. A Bypass Indicator is unnecessary.

    1. Make sure the reversal date matches the original offset date. Use CC BMFOLT to review a module that is not in the NRPS package or on IDRS.

      Caution:

      The TC 826 date may differ from the corresponding TC 706 date.

    2. Reverse multiple transactions in the order that the TC 826's appear on the module. Do not lump transactions together.

    3. Reverse a TC 826 offset if there is a pending manual credit transfer

  4. If an adjustment will leave a balance due on a module:

    1. Reverse the offset:

      Offset Reversal Decision Table
      If Then
      There is a current cycle TC 826/706 offset Reverse it in whole or in part to satisfy the balance due. Do not reverse a prior cycle TC 826 unless timely credits are located to satisfy the account.
      The module that received the offset has a current cycle refund Delete the refund. Reverse the TC 826 using a Posting Delay Code to allow time for the TC 841 to post before the TC 821.
  5. Use CC ADD24 with a TC 731/851 to reverse offset interest (TC 736/ 856).

    Note:

    Use CC REQ54 with a TC 772 to reverse the TC 776. Use Hold Code 3 if needed.

  6. Void or retype the CP 138.

  7. When manually transferring offsets, input TC 820/700 on CC ADD24.

    1. Use the later of the Return Due Date (RDD) or the date of the credit creating the overpayment as the TC 820/700 date.

      Caution:

      Never transfer lump sum credit from a module with an expired RSED.

    2. Multiple TC 820s may need to be input depending on the date credit is available. Always transfer the earliest available credits first.

3.14.2.7.1.4.3  (01-01-2015)
TOP OFFSET

  1. Bureau of the Fiscal Service (BFS) initiates refund offsets to outstanding federal agency debts or child support via the Treasury Offset Program (TOP). These offsets are referred to as TOP offsets. A TOP offset appears on the module as:

    • TC 898 with an Offset Trace Number (OTN), an offset amount, and a debtor-TIN field, if the offset is for a secondary spouse.

    • OTN - Starting with 1 indicates primary taxpayer debt.

    • OTN - Starting with 2 indicates secondary taxpayer debt.

  2. TOP offsets occur after the IRS has certified a refund to BFS for payment (TC 840/846 on account), but before BFS direct-deposits the refund overpayment or mails the refund check.

  3. A TOP offset reduces the amount of the IRS refund by the amount of the TC 898 offset.

  4. A TOP offset does not affect IRS’ ability to stop a refund through (CC) NOREF, or the time frame involved to do so.

  5. A TOP offset Bypass Indicator (BPI) is assigned to all manual and systemic refunds issued to BFS by IRS. The BPI is a one-digit indicator that identifies for BFS whether the refund is eligible for offset by TOP.

  6. The BPI is posted/displayed along with the TC 840/846 on all output screens such as TXMOD, IMFOL, BMFOL, and on MFTRA transcripts.

  7. There are ten BPIs, 0 through 9. For a complete definition of BPI codes refer to IRM 21.4.6.4.2.1

  8. TOP offsets are made against any refund issued from MFT 02, 07, 10, 13, 29, 34, 44, 46, 52, 55, 60, 63, 64, 77, and 78, unless a BPI is systemically generated on the refund or input on a manual refund. See IRM 21.4.6.4.2.1, TOP Offset Bypass Indicator (BPI).

    Note:

    For specific questions concerning offsets refer to IRM 21.4.6 .

3.14.2.7.1.5  (01-01-2015)
$10,000,000 Refunds

  1. An account with an overpayment of $10,000,000 or more requires that a manual refund be issued since a TC 846 will not generate. Assign these cases to a work leader the same day they are received in the unit.

    Note:

    Refer to Document 6209 for release of the -X Freeze.

  2. Use current procedures for resolving deletes to work the case:

    1. Verify all unclaimed credits.

    2. Offset the overpayment as needed to cover any debit balances.

    3. Abate any interest caused by an overpayment not due the taxpayer.

    4. Monitor the case until all actions post to the Master File.

  3. The account must be satisfied or in debit status before closing the control. If another area has an open control on the case, contact that area, and route all available documents to that area (remember to document this action on IDRS).

    Exception:

    The control base may be closed if there is an -L Freeze on the module and a Revenue Agent (RA) has advised that the credit not be refunded due to legal implications. Remember to document this action on IDRS.

  4. If, after any adjustments, the account has a credit balance less than $10,000,000:

    1. Offset credit to any debit-balance modules.

    2. Prepare a manual refund for the excess credit.

    3. Input manual refund using CC RFUNDR.

    4. Monitor the case until the TC 840 posts.

  5. If, after any adjustments, the account has a credit balance of $10,000,000 or more, the Accounting Function must issue the manual refund:

    1. Prepare Form 3753.

    2. Send a copy of the original return, transcript, Form 3753, all prints essential to manual refunds, and any other documents about the case to the Accounting function.

    3. Monitor the case until the refund (TC 840) posts (6 to 10 weeks).

  6. For additional information refer to IRM 3.12.38.5.4.2 BMF ERS Rejects.

  7. Close the control base after all account transactions post.

  8. Keep photocopies of the return and the transcript on file for future reference.

3.14.2.7.1.6  (01-01-2015)
Analyzing NRPS Data Sheet Appended

  1. NRPS extracts this data from the following sources:

    • Generalized Unpostable Framework (GUF) and Unpostable Files

    • Taped Edited Program (TEP) File

    • Error Resolution System (ERS) File Revenue Receipts

    • Unidentified Remittance and Excess Collection File

    • Resequencing File (RS)

    • Generalized Mainline Framework (GMF) Error, Block Out Of Balance (BOB), and Reject Files (RF)

3.14.2.7.1.6.1  (01-01-2015)
Pending Transactions

  1. Pending transactions are account actions that have not posted to the taxpayer’s account by the notice cycle.

  2. Pending transaction data consist of transaction codes, dates, and amounts, account identifying information, and other pertinent data. This data appears with the name of its source file (GUF, TEP, etc.) under the Pending Transaction heading on the NRPS Package Contents Page. (See Document 6209, Section 13.)

  3. Due to CADE 2 accelerating IDRS updates the amount of pending transactions should be reduced.

3.14.2.7.1.6.2  (01-01-2015)
Unpostable Transactions

  1. Unpostable transactions are transactions that require corrective action before posting to the Master File.

  2. Unpostable Codes (UPCs) identify the set of conditions that caused the transaction to be unpostable. Unpostable Reason Codes (URCs) specify the various conditions that can be present for each UPC.

    Note:

    http://serp.enterprise.irs.gov/databases/irm.dr/current/6209.dr/6209ch08B.htmDocument 6209, Section 8, contains descriptions of UPCs and RCs. This information will help decide the corrective action to take.

  3. The GUF and the Unpostable Files show pertinent information about unpostable transactions on IDRS, including:

    • Transaction Code

    • Date

    • Dollar Amount

    • TIN

    • MFT

    • Tax Period

    • Cross Reference (XREF) Account

3.14.2.7.1.6.2.1  (01-01-2015)
Reviewing Unpostable Transactions

  1. A pending Unpostable will display one of the following identification codes next to the Transaction Code:

    1. Unnn or UP-An open unpostable transaction nnn is a numeric unpostable codes (e.g., 198 or 175).

    2. CU-A corrected unpostable. The transaction should post in the cycle displayed on IDRS

    3. DU -A deleted unpostable. This transaction will not post and has been deleted from the module.

    4. NU-A nullified unpostable to be resolved by the Rejects Function or by the originating tax examiner.

      Reminder:

      If the account is not on your local database, research through universal access to research controls or actions being taken on the remote database.

  2. Use CC UPTIN on cases open on the Unpostable File to provide useful information to the Unpostables Function. Only the Unpostables Function can correct and close a case on the Unpostable File.

    Note:

    The originating tax examiner may need to resolve closed cases.

    1. Use the unpostable code to decide what caused the unpostable.

    2. If Unpostables has closed the case, an Unpostable Resolution Code (URC) will describe the resolution (See Document 6209, Section 9 and reference IRM 3.12.179). Use this information to decide how the transaction will affect the notice and the notice module. Correct the notice (See IRM 3.14.2.7.23, Notice Disposition and IRM 3.14.2.7.14.1, Adjustment Notices) and resolve the case (See IRM 3.14.2.7.19, Case Resolution). No further action is required on the unpostable.

    3. If the case is still open, check the transaction information to decide the cause of the unpostable. Overlay the CC UPDIS response screen with CC UPCASZ and input any history item information that will be useful in resolving the unpostable case.

    4. If the transaction can be posted as it is, leave a history item indicating that Unpostables should post the transaction without a change. The transaction may have been unpostable when it first reached the Master File.

      Example:

      A TC 670 transaction has failed to post to an account having a credit balance (UPC 198) but will now post because a debit transaction has posted.

  3. When a Notice Review Tax Examiner receives notification of an unpostable, the transaction has usually been deleted on IDRS. Use the Unpostable Code information to correct the transaction.

    Note:

    Unpostables will open a control base for the originating tax examiner and include the transaction on the Nullified Distribution Listing.

    Unpostable Decision Table
    If the Then
    Error condition can be corrected Reinput the transaction with the corrected information.
    Error condition cannot be corrected Close the base. Input any necessary history items, TC 570's or CC STAUPs. Delete any incorrect refunds.
    Adjustment or credit transfer was already input by someone else Do not enter a duplicate transaction. Close the control base.
    Unpostable Resolutions
    COMMON UNPOSTABLE CODES AND RESOLUTIONS
    UNPOSTABLE CODE ERROR CONDITION RESOLUTION
    UPC 305 A credit transfer input without a Bypass Indicator or a TC 570, attempts to post to a settled module.
    • When transferring a payment to a settled module, use CC UPTIN to tell the Unpostable (UP) Unit to allow the credit to post.

    • If the module balance changes to a credit balance and the credit is not to be released, input a TC 570 using REQ77, FRM77.

    UPC 313 Incorrect TC was used to reverse original TC in module. (no matching TC found) Determine what the correct TC should have been. Use CC UPTIN to alert the Unpostables unit to post with the correct TC. ( Input correct TC in remarks)
    UPC 316 Transaction date of credit transfer does not match date of the related TC. Use UPTIN to tell UP unit to post with the correct date. (Input correct date in remarks)
    UPC 316 Money amount not matching Input credit transfer with correct amount.
    UPC 316 Doc Code 24 credit transfer input for EFT payment without inputting the EFT indicator Re-input credit transfer using ADD/ADC24 with EFTPS indicator 1 or using ADD/ADC 34. (EFTPS indicator is not required)
    UPC 325 TC 820 or 830 amount exceeds the credit balance in the module Re-input the transaction by either waiting until the credit will be available or reducing the amount of the TC 820/830.
    UPC 328 A tax adjustment without Priority Code 8, is within $10.00 of a previous tax adjustment Decide if the adjustment is not a duplication. Re-input the adjustment with Priority Code 8.
    See IRM 3.12.279, titled BMF, Combined Annual Wage Reconciliation (CAWR), PMF Unpostable Resolution, for further information concerning resolving any of the UPC's listed above.

    Note:

    UPTIN CAN ONLY BE USED IF THE CASE IS OPEN ON THE UPTIN FILE.

    Note:

    The Unpostables Unit cannot correct money amounts.

3.14.2.7.1.6.2.2  (01-01-2015)
Preventing Unpostable Transactions

  1. Avoiding unpostables requires that the proper Priority Codes, Hold Codes, Bypass Indicators, Freeze Codes (or TC 570), and Posting Delay Codes be input with adjustment actions. When inputting a credit transfer follow instructions in IRM 3.14.2.7.20 and mandatory use the IAT tool. The following are actions to take to prevent unpostables:

    • Decide the correct TC.

    • Use Doc Code 24 to transfer credits between Master Files when a secondary TC is needed, or when changing the date on a posted transaction.

    • The debit and credit parts post separately on ADC 34 (3 cycle) and ADD 34 (2 cycle).

    • The debit and credit parts post together on ADC 24 and ADD 24.

  2. Review each account carefully before entering an adjustment or credit transfer.

    Note:

    The use of Integrated Automation Technologies (IAT) when inputting credit transfers has been designated as being mandatory. The IAT tool was designed to help reduce unpostable transactions and to prevent erroneous transactions from posting.

  3. Consider the effects of pending transactions, previous actions, freeze codes, module balances, and posted manual penalty and interest adjustments. Also consider the effects of the transaction being input.

  4. Contact any tax examiner with an open control base in A status only to coordinate actions on modules and prevent erroneous and duplicate adjustments. See IRM for additional instructions for contacting IRM 3.14.2.7.1 (11).

  5. To prevent Unpostable Tax Adjustments (Doc Code 54):

    1. Be sure the adjustment is not a duplicate of a previous adjustment.

    2. Consider previous tax adjustments before inputting a subsequent adjustment, especially those within $10 of a previous adjustment.

    3. Look for manual adjustment of penalties and interest (TCs 160, 161, 170, 171, 340, and 341) that need correction or recognition when inputting an adjustment.

    4. Use the correct MFT, tax period, and name control.

    5. Input the correct Item and Credit Reference codes. Consider posted amounts and limitations for each code being input. Do not reduce Reference Number 886 below zero.

  6. To prevent Unpostable Credit Transfers (Doc Codes 24, 34, or 48):

    1. Follow instructions in IRM 3.14.2.7.20

    2. Use the correct reversal transaction code for the posted transaction code.

      Example:

      Use TC 672 to reverse TC 670.

    3. Use the correct MFT, name control, and tax period.

    4. When transferring overpayments, make sure the credit to be transferred is available on the module. The TC 830/820 amounts cannot exceed the credit balance on the module.

    5. When transferring payments from an account, make sure the dates on both sides of the credit transfer match. The money amounts must not exceed the amounts of the transactions being reversed.

      Exception:

      TC 826 and TC 706 can have different transaction dates. Use the correct dates for the debit and credit transactions when reversing these transactions. See IRM 3.14.2.7.1.5.1 (Offsets) for credit elect and offset procedures.

    6. Use a Bypass Indicator 1 to allow the credit to refund, or use a TC 570 or Credit Freeze Code 1 to freeze the credit when transferring TCs 650, 660, or 670 to a full paid tax module (status 10 or 12) and the posting of the credit will create an overpayment of $1.00 or more.

    7. Use a Bypass Indicator 1 to allow the credit to refund, or use a TC 570 or Credit Freeze Code 1 to freeze the credit when transferring TCs 650 or 670 to a balance due tax module when the payment is dated later than the period ending and the posting of the credit will create a credit balance of $10.00 or more.

    8. Use a Credit Freeze Code 1 or input a TC 570 on the credit side of the transfer if the credit will be held. This will generate a –R Freeze.

      Note:

      Two TC 570's will not post simultaneously on a module, you should use only one TC 570 for multiple credit transfers.

    9. An EFT indicator is required on a 24 Doc Code for EFT deposits.

    10. Use a Posting Delay Code to delay the posting of a transaction so that it matches the posting cycle of another transaction. Enter 1 through 6 to delay the posting of a transaction for one to six cycles, respectively.

      Example:

      Use a Posting Delay Code to delay the posting of a Doc Code 48 debit transaction until a Doc Code 34 credit transaction posts.

3.14.2.7.2  (01-01-2015)
Common Command Codes Used In Notice Review

  1. Command Codes are used to perform taxpayer account research to aid in case resolution and to initiate changes to taxpayers accounts on IDRS (Integrated Data Retrieval System).

  2. The BMF Notice Review employees are required to use the Integrated Automation Technologies (IAT) tools. The IAT tools simplify taxpayer account processing by assisting the user with IDRS research and input. They are desktop productivity enhancing tools.

  3. If an IAT tool is not available, or an employee has a problem with the IAT TASK Manager (ITM), the account action should be processed manually on IDRS. If you have any questions or concerns contact your lead for help. Refer to IAT Job Aid for additional information at Document http://iat.web.irs.gov/JobAids/iat.asp

  4. Below are the most commonly used IDRS Command Codes in Notice Review with a brief description of its use:

    • ACTON - Used to open or close control base and input history items. See IRM 2.3.12 for more information

    • ADD/ADC24 – Used to transfer payments or reverse offsets.

    • ADD/ADC34 - Used to transfer one to four payments.

      Note:

      The credit side of the transaction will post one cycle after the debit side. For more information about doing credit transfers go to IRM 2.4.17.

    • ADD/ADC48 - Used to input credit elect transactions.

    • AMDIS - Provides a display of any action or potential action initiated by the Examination Function. For more information refer to IRM 2.8.3

      Note:

      The definer A (AMDIS A) limits access to a particular module.

    • BMFOL - The use of CC BMFOL provides on-line research of nationwide entity and tax data information posted to the Business Master File (BMF). For more information please go to IRM 2.3.59. Use the specific definer below to search for the information that you need:

      Definer Display File Source MFT and Tax Period Result
      A Y Y Adjustment transactions including trans code, posted date, among, cycle, DLN, codes and other dates
      B Y Y CFOL038 Screen message or error screen.
      C N N Tax Module screen associated with input check symbol/check number, CFOL041, or CFOL042
      D Y N Deposit Schedules for 941, CT-1, 943, and 945.
      E Y N Entity information including cross-ref TIN, freeze codes, indicators, codes, and posted transactions
      F Y N FTD coupon ordering information
      H N N Help screen
      I Y N On/off-line status of entity and tax modules, merge information, sign of module balance, posted return indicator, and IDRS service centers
      K Y Y F941 Lookback information
      L Y N Last tax module satisfied
      N Y N Index of Retention Register Tax Modules that do not have an associated Vestigial Entry
      O Y N Exempt organization information
      P Y N Payment Summary
      R Y Y Return DLN, cycle posted, transaction date, some schedules, codes, exemptions, amounts
      S Y Y Status histories
      T Y Y Control DLN, exemption total, settlement information, amounts, freezes, indicators
      U Y Y CAWR information
      V Y N Vestigial data (retention register)
      W Y Y Quarterly F941 information.
      Z Y N Audit history information
      # N Y Refund Checks (up to 5) associated with a particular TIN/MFT/Tax Period.
    • BRTVU - Used to display the transcribed and posted data on various BMF returns. For more information refer to IRM 2.3.57.

    • CFINK - Accesses the Centralized Authorization File (CAF), which contains information on the type of authorization that a taxpayer has granted a representative. For more information refer to IRM 2.3.31.

    • COMPA - This Command Code is used to manually compute penalties and interest. You must use the correct definer when calculating the penalty. Please see the list of definers below. For more information refer to IRM 2.3.29.

      CC COMPA Definers
      C
      1. Before 01/01/1999 for a Non-Corporate Taxpayer

      2. Before 01/01/1995 for a Corporate taxpayer, regardless of the overpayment amount.

      3. On or after 1/1/95 for a Corporate taxpayer and the overpayment amount is less than or equal to $10,000

        Caution:

        If the GATT threshold has been met, the overpayment will be computed at the GATT interest rate (COMPAG), regardless of the overpayment amount. See IRM 20.2.4.9.2 , Determining the GATT Threshold.

      A On or after 01/01/1999 for a Non-Corporate taxpayer
      D Used to compute debit interest. Provides percentages, factors, and dates for the computation. Limited to one computation per request.
      E Used to compute Estimated (ES) Penalty, accumulates and displays page totals, and provides estimated tax from and to dates in a formatted screen display for MFTs 02, 05, 33, and 44.
      F Used to compute Failure to Pay Penalty (FTP) (TC 276).
      G Credit interest after 12/31/94 for a Corporate taxpayer and the overpayment amount is greater than $10,000, or the GATT threshold has previously been met (See IRM 20.2.4.9.2, Determining the GATT Threshold.)
      M Used to compute multiple independent credit interest computations on the same page.
      P Used to compute interest rate at 120% of the current normal interest rate.
      R Used whenever several independent interest calculations are desired on the same page.
      S Used for the manual computation of the Estimated Tax Penalty.
      4 Used with certain estate tax modules. Computes interest at 4%.
      5 Used to compute interest at 45% of the current normal interest rate, and displays details of the interest computation on the response screen.
    • ENMOD - Used to request a display of a particular taxpayer's name, address, Fiscal Year Month (FYM) and filing requirements. For more information refer to IRM 2.3.15.

      Note:

      This CC is a prerequisite for CC ENREQ.

    • ENREQ - Used to make name, address, and miscellaneous changes to the data recorded on a taxpayers entity module (ENMOD). For more information refer to IRM 2.4.9.

    • ESTAB - To request or recharge documents. For more information refer to IRM 2.3.62

    • FRM49 - Used when reprocessing a return to a prior year (quarter) module with a TC 140 present. For more information refer to IRM 2.4.26.

    • FTDPN - Used to manually compute FTD Penalty on Form 940, Form 941, Form 943, Form 944, and Form 945. For more information refer to IRM 2.3.28.

    • INOLE - The National Account Profile (NAP) file, contains Master File entity information on all taxpayers by TIN. For more information refer to IRM 2.3.47. The list of definers used are:

      CC INOLE Definers
      G Used when TIN type is unknown.
      T Displays name line and street address for all accounts with the same EIN.
      S Displays name line information available for any account associated with the TIN.
    • INTST - CC INTST computes the correct outstanding balance, including interest and failure to pay accruals, to the date specified in the input of the command code. For more information refer to IRM 2.3.29. A list of Definers is listed below:
      CC INTSTA has the same capabilities as INTST. In addition, accruals will be computed to the input date plus 10 days, 15 days and 21 days or any dates input, as long as they are less than 30 days.
      CC INTSTB has the same capabilities as CC INTST. In addition, it computes a separate total for other assessed penalties.
      CC INTSTD is used to display FTP and Interest calculations.
      CC INTSTN has the same capabilities as INTST. In addition accruals will be computed to the input date plus 30 days, input date plus 45 days, and input date plus 60 days.

    • LETER - Used to input IDRS letters. For more information refer to IRM 2.4.6.

    • LPAGD - Used to delete IDRS letters.

    • MFREQ - Used when a module is not on TXMOD, but is on BMFOL. For more information refer to IRM 2.3.10

      Note:

      MFREQ with definer C transfers the data from BMFOL to TXMOD to display existing data on modules that are not available (up) at your campus.

    • NAMEB - Allows IRS employees access to the national file name and address data located at ECC-MTB. For more information refer to IRM 2.3.60.

    • NOREF - Used to delete refunds and automatically opens a control base.

      Note:

      Refer to IRM 3.14.2.4.5 (Refund Intercept) for valid definers for CC NOREF and IRM 2.4.37.

    • PIEST - Displays an explanation of an estimated tax penalty (TC 176) computation. For more information refer to IRM 2.3.41.

    • PIFTD - Displays an explanation of an FTD penalty (TC 186) computation.

    • PIFTF - Displays the computation of the Failure to File Penalty (TC 166).

      Note:

      CC PIFTF must be used to decide if the FTF penalty will recompute after payments are moved into and out of a module.

    • REQ54 - Used to make tax, penalty, interest and other adjustments to a tax module. For more information please go to IRM 2.4.16.

    • REQ77 - Used mainly to input TCs 460, 470, 570, 571, and 971. For more information refer to IRM 2.4.19.

    • RFINK - Used to research the Reporting Agent File. For more information refer to IRM 2.3.16.

    • RFUNDR - Used to input a manual refund on IDRS. For more information refer to IRM 2.4.20.

    • SCTFR - Used to access the Campus Control File.

    • SFDISP - Used to display all authorized CC in an employees security profile.

    • STAUP - Used to delay, accelerate, or skip the issuance of notices to taxpayers. For more information refer to IRM 2.4.28.

    • SUMRY - Used to request a chronological listing of all available tax modules on IDRS for a particular TIN. For more information refer to IRM 2.3.11.

      Note:

      If CC SUMRY is accessed and only one module is available, IDRS will display that module.

    • TERUP - Used to void/remove an adjustment transaction, including credit transfers, name and address changes, etc., made to a taxpayer's account. For more information refer to IRM 2.4.13.

      Note:

      The originator of the adjustment must input CC TERUP by 6:00 p.m. of the same day of input to ensure the transaction will be voided. For swing shift cutoffs, see your work lead.

    • TRDBV - Provides access to tax return and related schedule data on Electronically filed returns. For more information refer to IRM 2.3.73.

    • TXMOD - Command Code TXMOD is used to request for display all tax module information for a specific tax period on the Tax Information File (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. Use the following definers to access a specific module of a particular TIN: For more information go to IRM 2.3.11

      CC TXMOD Definers
      A Displays tax module information.
      C Displays control base and history data.
      L Displays pending transactions.
      N Displays notice data.
      P Displays posted and pending transaction data.
      S Displays Campus and Master File status history data.
      X Displays status history and notice data.
    • UPDIS - Input with the unpostable sequence number to bring up the response screen CC UPRES on IDRS. For more information refer to IRM 2.3.48.

    • UPRES - Response screen to CC UPDIS.

      Note:

      When CC UPRES is overlaid (replaced) with CC UPCASZ, history items can be added.

    • UPCASZ - Used to add history items to the CC UPRES screen.

    • UPTIN - Displays unpostable case data, including the unpostable sequence number used to input CC UPDIS. For more information refer to IRM 2.3.47.

    • URINQ - Used to view payment information in the Unidentified Remittance File (URF). For more information refer to IRM 2.3.20.

    • XSINQ - Used to view payment information in the Excess Collection File (XSF). For more information refer to IRM 2.3.45.

3.14.2.7.3  (01-01-2015)
Unidentified Remittance and Excess Collections Files

  1. When there is insufficient information to properly apply credits to a taxpayer’s account (e.g., when a taxpayer does not claim a payment and the correct taxpayer cannot be located), funds may be transferred to the Unidentified Remittance File (URF - 4260 Account) or the Excess Collections File (XSF - 6800 Account). If a return is later filed claiming those payments, it may be necessary to request a transfer to move the payments from URF or XSF to the Master File. Please refer to IRM 3.17.220, Accounting and Data Control - Excess Collections File, for further guidance. If the credit is an FTD/EFTPS payment, the last five digits will reflect the FTD/EFTPS number into 9 through 13 digits of the original DLN. This will create a unique control number which reflects the credit’s origin.

  2. When a credit or payment is moved to the Excess Collection File (XSF) or the Unidentified Remittance File (URF), a Transaction Code (TC) 971, Action Code (AC) 296 must be input on the module, please refer to IRM 21.2.4.4.15.1(1)(a) . This is the final audit trail that indicates that all available research sources have been used. This requirement was part of the Excess Collection Task Group and was started in 1/2007. This applies to Excess Collection only.

    Note:

    TC 820 may indicate that a payment has been moved from the taxpayer’s account to URF or XSF. If the cross-reference TIN and tax period (next to the transfer DLN) are all zeros or nines, the credit was transferred to either the URF or the XSF. Matches with these files are displayed on the NRPS Appended Data page.

    1. Research CC XSINQ/URINQ for credits claimed by taxpayers.

    2. Credits less than 12 months old are applied to the Unidentified Remittance File. Credits over 12 months old are applied to Excess Collections. An application to move credits to Unidentified Remittances can be made in the 11th month.

      Exception:

      Credits with Document Codes 48, 58, or 65 may be added to the XSF regardless of age.

    3. Generated Refundable Credit (TC 766) will be accepted by Excess Collections.

  3. Excess Collections File (6800 Account)

    1. When credits and payments are over one year old and have not been applied back to a taxpayer's account on Master File, they are moved into the 6800 Account.

  4. If necessary to transfer credits or payments to the Unidentified Remittance File or Excess Collections File, see work lead.

3.14.2.7.3.1  (01-01-2015)
Requesting Payments From Unidentified Remittance File (Form 8765)

  1. Use CC URINQ to verify the availability of the credit.

    1. Complete the Form 8765. (See Figure 3.14.2–4, Form 8765 and Instructions.) Attach current prints of CC's URINQ, BMFOL, or TXMOD to Part 1 of the form.

      Note:

      Current, for the purpose described throughout this section (3.14.2.4.8), denotes less than 7 days old before routing cases for payment application.

      Note:

      Remember Form 8765 must be forwarded to the correct Campus based on the DLN of where the money was applied.

    2. Input a CC STAUP for 9 cycles on balance due modules. This will prevent the generation of a notice while the transfer is being processed.

  2. After requesting application of payment, treat the notice as if payment(s) will be applied to the module.

  3. If the refund statute has expired, the application to move credits from Excess Collections File (XSF) must not exceed the tax liability, interest, and penalties. There can be no refund or credit elect. Timely payments will abate all but self assessed penalties. Timely payments can also result in the abatement of self-assessed estimated tax penalties. If the module contains a TC 170 with a DLN that matches the return DLN, use CC ADJ54 to post TC 170 .00 to prevent abatement of the self-assessed estimated tax penalty.

  4. Follow local procedures if the notice module is a statute year, before routing it to the Excess Collection unit.

    Figure 3.14.2-6
    This image is too large to be displayed in the current screen. Please click the link to view the image.

3.14.2.7.3.2  (01-01-2015)
Requesting Payments From Excess Collections (Form 8765)

  1. To request a payment from Excess Collections File (XSF):

    1. Use CC XSINQ to verify the credit(s) is available.

      Note:

      The credit is not available if the remarks section of the XSINQ record indicates CLOS. Do not request transfer of the credit.

      Reminder:

      Remember Form 8765 must be forwarded to the correct Campus based on the DLN of where the money was applied.

    2. Complete Form 8765 to request the Excess Collection Function transfer payment/credit from XSF to the taxpayer's account. (See Figure 3.14.2-4, Form 8765 and Instructions.)

    3. Include a complete explanation of the reason for the request in the remarks section of Form 8765.

    4. Attach a current print (less than 7 days old) of CC TXMOD or BMFOLT and CC XSINQ to Form 8765.

    5. Route Form 8765 with attached research to the Excess Collection Team.

      Caution:

      If the refund statute has expired, the credit application must not exceed the tax liability, interest and penalties. Follow local procedures if the notice module is a statute year.

  2. After requesting application of the credit, complete notice disposition as if payment(s) will post to the module:

    Decision Table
    If Then
    Payment(s) is timely and all penalties will abate. Void notice and request subsequent notice utilizing LCF.
    Payment(s) is late or unsure of TC 186 penalty recomputation. Apply Label #2 and allow subsequent notice to generate.
  3. Input CC STAUP for 9 cycles on balance due accounts to prevent erroneous notices.

3.14.2.7.4  (01-01-2015)
Special Notice Review Issues

  1. This subsection contains instructions related to miscellaneous issues such as:

    • Taxpayers meeting Taxpayer Advocate Service (TAS) Criteria

    • Slipped or Mixed Blocks

    • Natural Disaster

    • Large Dollar Review

    • Short Period

    • Undeliverable

    • Conversion of Form 944 to Form 941

    • American Recovery Reinvestment Act of 2009

    • PII fraudulent returns

3.14.2.7.4.1  (01-01-2015)
Taxpayers Meeting Taxpayer Advocate Service (TAS) Criteria

  1. Taxpayers meeting TAS criteria will get priority handling. See IRM 13.1.7, Taxpayer Advocate Case Criteria, for additional information.

  2. If you are able to resolve and close the issue meeting TAS case criteria on the same day as the taxpayer contact, input history item (one day/CL). The definition of same day is within 24 hours. There will be times you can completely resolve the issue within 24 hours. There will also be times that you cannot completely resolve the issue within 24 hours. If you have taken steps within 24 hours to resolve the taxpayer's issue, these cases also meet the definition of same day. Do not refer these cases to TAS unless the taxpayer asks to be transferred to TAS. Refer to IRM 13.1.7.4, Same-Day Resolution by Operations.

    1. A case that meets the criteria above may be kept in the general area when the problem has been corrected.

    2. The taxpayer is advised of the name, phone number, and Identification (ID) number of the employee who resolved the problem.

    3. The taxpayer is provided the National Taxpayer Advocate toll-free number (1-877-777-4778) or TTY/TDD 1-800-829-4059, and is advised that TAS is available if further assistance is needed.

  3. When referring cases to TAS, use Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance order) and forward to TAS in accordance with your local procedures.

3.14.2.7.4.2  (01-01-2015)
Slipped Blocks and Mixed-Data Blocks

  1. "Slipped blocks" and mixed-data blocks occur when data from a document or payment posts to a module related to a different document or payment in the same block of DLNs. The erroneous data on the notice module usually belongs to the taxpayer whose document or payment is immediately before or after the notice document or payment in the DLN block sequence.

  2. Slipped Blocks have the following characteristics:

    1. A block (or part of a block) of documents or payments posted to the Master File incorrectly.

    2. The incorrect transactions have DLNs from other documents or payments in the same block.

    3. The DLN is usually from the document or payment immediately before or after the notice document or payment in the block sequence.

    4. A slipped block may result in erroneous refunds, incorrect notices, and/or lost or missing documents, returns, or payments.

  3. Mixed-Data Blocks have the following characteristics:

    1. A block (or part of a block) of documents or payments posted to the Master File incorrectly.

    2. The data is incorrect due to a transcription error.

    3. A mixed-data block may result in erroneous refunds and/or incorrect notices.

  4. Suspect a slipped block or a mixed-data block if any of the following conditions are present:

    1. The data on the notice module does not match the data on the document.

    2. A posted payment amount does not match the amount listed on the payment voucher.

    3. A payment is missing or is misapplied.

  5. Research and inspect the block:

    1. Review the Remittance Transaction Research (RTR) system to match checks with name/EIN.

      RTR Decision Table
      If the Situation Involves And the Case is a Then
      Two or fewer taxpayers Slipped or mixed data block Resolve the case in Notice Review. (See IRM 3.14.2.7.19 , Case Resolution.)
      More than two taxpayers Slipped block Recharge and route the BMFOL prints and RTR check prints to the Accounts Management Function's Adjustments/Payment Tracer Unit.
      Mixed-data block Recharge and route the BMFOL prints and RTR check prints to the Accounts Management Function (Adjustments).
  6. When routing the case:

    1. Input CC STAUP for 9 cycles on any balance due account.

    2. Input a TC 570 on any credit balance account.

    3. Close the Notice Review control base.

    4. Enter appropriate history items.

    5. Indicate in the remarks section of Form 3465 that a. through d. above have been completed.

  7. Make every effort to resolve or route slipped and mixed data situations in cycle.

3.14.2.7.4.3  (01-01-2015)
Natural Disaster Procedures

  1. Notice Suppression – The Disaster Relief Memorandum identifies the covered disaster area (zip codes) and the beginning and ending dates for notice suppression and/or stuffer requirements. If systemic notice suppression is established by an - O Freeze, no further action is required to suppress notices.

    Note:

    If an -O freeze is not reflected on the taxpayer’s account, whose address of record is in the covered disaster area, then input a TC 971 with an AC 688 via the IDRS tool to ensure that the account will not have any penalties and/or interest being assessed on it.

  2. Penalty Adjustments – If the -O Freeze is not on the module, notices with zip codes in the impacted disaster areas may require penalty adjustments for the period designated in the Disaster Relief Memorandum. Use Local Control to select those notices with zip codes in the impacted disaster areas.  
    Notice Review will review notices generated for taxpayers who have filed late tax returns, or submitted late payments during the disaster period. Notice Review will only address the Failure to File and Failure to Pay penalties if the following apply:

    1. If only the Failure to File penalty (TC 166) is assessed, decide the Return Due Date (the extended disaster due date) and the return received date. If the return received date is timely based on the disaster extended due date, abate the TC 166 for each month, or part of a month the penalty was assessed. (See IRM 20.1.2, Failure To File/Failure To Pay Penalties.)

    2. If only the Failure to Pay penalty (TC 276) was assessed, abate the penalty for each month and/or part of the month from the original due date to the extended due date that the tax remained unpaid.

    3. If both TC 166 and TC 276 penalties were assessed, but the return was received by the date specified in the Disaster Relief Memorandum, abate the part of the penalties assessed from the original due/payment date to the actual receipt date/payment date. (See IRM 20.1.1 , Introduction to Penalty Relief and IRM 20.1.2. Failure to File/Failure To Pay Penalties for abatement procedures.)

  3. If the taxpayer notates on the front of the return the designated disaster phrase, abate the TC 166 and TC 276 per instructions in (2) above.

  4. If the taxpayer correspondence attached to the return is requesting relief of any penalty because of disaster damage or disruption, take the following actions:

    1. Decide if the taxpayer qualifies for TC 166 and/or TC 276 relief based on the disaster criteria. If the taxpayer qualifies, abate the penalty(s).

    2. If taxpayer does not qualify for relief based on the disaster criteria but may qualify based on the Reasonable Cause criteria, route the case to Accounts Management. This includes taxpayer requests for FTD Penalty abatement.

  5. FTD and Reasonable Cause – All requests for abatement for FTD penalties received in Notice Review must be routed to Accounts Management for determination and resolution.

  6. Estimated Tax Penalty – If an Estimated Tax Penalty (TC 176) has been assessed, decide if the taxpayer was required to make an estimated tax payment during the disaster period. If the payment was received by the date required by the Disaster Relief Memorandum, abate the part of the estimated tax penalty assessed for the underpayment. Notate on the adjustment document, "Adjustment Due to Disaster" . If in doubt, send case to Accounts Management for determination and resolution.

3.14.2.7.4.4  (01-01-2015)
Large Dollar Review

  1. Upon identification, all Balance Due Notices of $100,000.00 or more must be reviewed for accuracy.

    1. An in-depth review of the entire account must be performed, since problems with other modules or TINs not directly related to the notice often surface at this time and must be expeditiously resolved to prevent future taxpayer and/or Accounts Receivable impact.

    2. If a questionable situation is identified, but you cannot positively decide how the account must be adjusted, give the case to the work lead. The work lead will telephone the taxpayer for additional information. If the taxpayer verifies the balance due is correct, mail the notice. If the taxpayer indicates that incorrect data was submitted on the return, request that corrected information be sent. If unable to contact the taxpayer before the mailing deadline, mail the notice.

    3. When reviewing Form 1065 with partnership penalties review the prior year to see if the number of partners appear to be in error. Erroneous penalties may have been assessed because various other fields were picked up for the number of partners. If the penalty is in error, recompute and make the necessary adjustment, and retype the notice. For CP 162 instruction refer to IRM 3.14.2.7.10.

    4. Form 706 is filed under the decedents Social Security Number (SSN). When researching IDRS, input a "V" behind the decedents SSN (i.e., 000-00-0000V). The MFT is 52 and the tax period consists of six zeros (000000). Although the return is filed under the decedents SSN, research via BMF CC such as BMFOL and BRTVU. Also, input a "W" behind the decedents SSN to research accounts on the invalid segment

    5. For Forms 706/709, use CC IMFOL to research the IMF SSN for possible misapplied payments.

      Note:

      An SSN beginning with 909–17 or any temporary TIN will not have any Master File information.

    6. For Form 709, the missing credit may be posted to the Form 1040 account (for returns check both SSNs). If the Form 1040 is overpaid, research CC RTVUE for the amount of credit the taxpayer claimed on the Form 1040 return. If credit is available for the Form 709:

      Decision Table
      Delete the refund on the 1040 account
      Transfer the credit
      Input a CC STAUP for 9 Cycles on the Form 709 account
      Transfer the extension if no extension is posted on the 709

    Note:

    Form 1040 extensions Form 4868 include the extension for the Form 709 account.

3.14.2.7.4.5  (01-01-2015)
Short Period Returns

  1. A short period return must be filed by a subsidiary corporation when it becomes affiliated with a consolidated group (parent corporation). This step allows the subsidiary corporation to file an initial consolidated return with the parent corporation. Income not included in the consolidated return by a corporation, because it was not in the group for the complete taxable year, must be reported on a separate return. The due date of the return is decided by using the earlier of the due date of the original tax period of the parent corporation, or the due date of the original tax period of the subsidiary corporation. Do not confuse the original tax period with the short period.

    1. Research of the parent corporation accounts may be required to decide the due date.

  2. Review any short period Form 1120 to decide if the taxpayer has filed using this regulation. If so, recompute interest and penalties and correct the taxpayer’s account.

  3. Change in Accounting Period.

    1. Form 1120 must be filed by the 15th day of the 3rd calendar month.

    2. An approved Form 1120 can be identified on the Entity module by a TC 053 or a TC 054.

  4. Tax entities not in existence the entire year may file a short period return. Requirements for filing the return and figuring the tax are generally the same as if the return was for a full tax year that ended on the last day of the short tax year.

  5. Watch for any reprocessable returns.

3.14.2.7.4.6  (01-01-2015)
Researching Undeliverable Notices

  1. Research ENMOD for PN and AP address changes. Use the new address, if present.

  2. Use the address on the yellow Post Office Forwarding Label if it is different from the notice address.

  3. Use the address on the 3 x 5 card from the Files Function if a more current address was not found and the notice has an original DLN.

  4. Use the following procedures if a more current address is not found:

    1. Use local procedures to send the notice to the Files function to be attached to the return.

    2. Input CC STAUP 51 for no cycles to issue a Taxpayer Delinquent Account (TDA) to the Collection function and suspend all Collection procedures.

      Example:

      STAUPS 51

3.14.2.7.4.6.1  (01-01-2015)
Resolving Undeliverable Notices

  1. Do not change the entity based on the address on the 3 x 5 from Files, the Post Office label, or research:

    1. Follow local procedures to change only the address on the notice.

    2. Include Form 8822 (Change of Address) with the notice.

      Note:

      The taxpayer will use this form to authorize an address change.

    3. Label the notice with the appropriate label.

    4. Use CC ACTON to enter a history item if CC TXMOD is up on IDRS.

    5. Input a CC STAUP for six cycles on balance due accounts.

  2. To decide the appropriate label for Refund and Overpaid notices:

    Label Decision Table for Refund and Overpaid Notices
    If Then Mail the Notice With
    A TC 846 posted to the module in the notice cycle Labels #11 and #12.
    A TC 740 posted to the module with 99999 in the DLN, setting an S- Freeze Labels #11 and #12 if a new address is found.
    Note: The S- Freeze means that a refund check was returned as undeliverable.
    A TC 740 posted to the module between two TC 846's for the same amount Labels #11 and #12 to the address shown on CC ENMOD.
    Note: The original refund check was returned as undeliverable and subsequently reissued.
    No TC 846 is present on the module Label #11.
  3. To decide the appropriate label for Balance Due Notices:

    Label Decision Table for Undeliverable Balance Due Notices
    If a Payment Then Mail the Notice With:
    Posted since the notice cycle or is pending on the module, Labels #3 and #9. Use CC INTST to decide the new account balance.
    Has not posted since the notice cycle, Label #9. Use CC INTST to decide the new account balance.
  4. Resolve Even Balance and Information notices by mailing the notice with Label #11.

    Note:

    Use CC BMFOL if the account is not available on IDRS.

  5. Resolve Adjustment notices by mailing the notice with Label # 9 or any other applicable label from IRM 3.14.2.7.23.5 , Labeling Notices.

  6. Assume that any subsequent notice that was mailed is also undeliverable. Update the original notice using the above instructions.

    Exception:

    If module conditions indicate that the entity was corrected before the subsequent notice generated, assume that the notice was deliverable and take no action other than to correct the undelivered notice.

    1. If the subsequent notice is going out in the current cycle, void the notice if possible.

    2. Input a history item on IDRS.

  7. Paper clip all stuffers and attachments to the notice. Do not discard anything. Return the completed Undeliverables to the Clerical Unit to be mailed within the same cycle as received.

3.14.2.7.4.7  (01-01-2015)
Form 944 Issues

  1. Taxpayers who file Form 944 should have total taxes of $1000 or less. If over that amount, then a taxpayer can receive 3 notices for this condition depending on when the return is processed. All three notices give the taxpayer instructions on what form to file. The notices are

    1. CP 250A - You Are No Longer Eligible to File Form 944

    2. CP 250B - You Are No Longer Eligible to File Form 944

    3. CP 250C - You Are No Longer Eligible to File Form 944

  2. CP 250A is issued to taxpayers who file Form 944 and have a total tax liability on line 7 of Form 944 of more than $1000, but the returns met the PCD (Program Completion Date), posting in or before cycle 09. This notice instructs the taxpayer that he is no longer eligible to file Form 944 and he must file quarterly using Form 941 for the current year.

  3. CP 250B is issued to taxpayers who file Form 944 and have a total tax liability on line 7 of Form 944 of more than $ 1000, but the return did not meet the PCD of cycle 09. This notice is for the returns processed between cycles 10 - 49. This notice instructs the taxpayer they will remain a Form 944 filer for the current year and to make the appropriate FTD's as required by the lookback analysis. These taxpayers will be allowed to remain Form 944 filers for the year because there is not a sufficient amount of time to notify them to file quarterly. Taxpayers that receive CP 250 B will also receive CP 250C later in the year informing them that they will be changed to a Form 941 filer beginning in January the subsequent year.

  4. CP 250C is issued to Form 944 filers who received CP 250B earlier in the year, or File Form 944 after cycle 49 of the current calendar year. These taxpayers will not receive CP 250B, only CP 250C. This notice informs the taxpayer that because they exceeded the threshold for the Form 944 participation, they must file Form 941 for the upcoming year. This notice is generated in cycle 52.

3.14.2.7.4.7.1  (01-01-2015)
Instruction for Form 944

  1. If the Taxpayer receives a CP 250A and a selected notice, generally a CP 145 Notice Review should:

    1. Transfer any credit elect amount(s) from Form 944 to the Form 941 first quarter return of the following year.

    2. Retype CP 145 to reflect Form 941 for tax period ending 03312015.

      Exception:

      For notices reviewed in 2015, use Label 7 to alert the taxpayer where the credit elect has been applied to.

      Exception:

      If credit elect amount is zero mail CP 145.

  2. Notice Review will not be required to take any action for CP 250B and CP 250C.

3.14.2.7.4.8  (01-01-2015)
American Recovery Reinvestment Act of 2009

  1. The following are General Review Procedures for the new American Recovery Reinvestment Act of 2009 (ARRA) related to Form 8038-CP (MFT 46) procedures:

    a) The following disposition codes are the only ones allowed to be used for CP 116s, CP 138s, CP 210s, CP 220s for Form 8038-CP (MFT 46) when utilizing the On-Line Notice Review (OLNR) application:

    • E (Entity) - Use this disposition to make entity information changes or updates.

    • V (Void) - Use this disposition to void the notice completely because of inaccurate information.

    • VI (Void/Intercept) - Use this disposition to void the notice and to intercept any refund on the module. It will only be applicable to CP 210s or CP 220s.

    • P (Print) - Use this disposition to mail the notice to the taxpayer.

    • PI (Print/Intercept) - Use this disposition to mail the notice and intercept the refund on the module. It will only be applicable to CP 210s or CP 220s.

    Note:

    These notices will not carry any penalties and no penalties shall be added to any of these notices. Exception: CP 210 and CP 220 may include Failure to Pay penalty if a previously claimed credit was previously disallowed after a refund was issued.

    b) The following disposition codes are the only ones allowed to be used for CP 380s , CP 384s and CP 388s generating for Form 8038-CP (MFT 46) when utilizing the OLNR application:

    • T (Transcript) - Use this disposition to mark the account as a transcript and no other updates are needed.

    • TI (Transcript/Intercept) - Use this disposition to just mark the account as a transcript and intercept the refund

    Note:

    A CP 386s will never generate for a Form 8038-CP (MFT 46).

3.14.2.7.5  (01-01-2015)
Reviewing Notices With Freeze Codes

  1. Consider all existing freeze codes before taking any action on a tax module.

  2. Document 6209 has a complete listing of Master File Freeze Codes with explanations of the codes, conditions on the account, and freeze release instructions. Consult your work lead for instructions for resolving cases with freeze codes not mentioned in the following sections.

3.14.2.7.5.1  (01-01-2015)
Duplicate Return Freeze (-A)

  1. The -A Freeze is set when a duplicate or amended return (TC 976 or TC 971 (AC 010)) posts to a tax module that contains a posted original return.

  2. The freeze generates a CP 193 transcript that is routed to Accounts Management (Adjustments) for resolution.

  3. If the notice is selected for review, follow the procedures in the chart below.

    -A Freeze Decision Table
    If Then
    The Category Code is DUPF or 941X
    • Do not transfer credit into or out of the notice module.

    • Do not assess the TC 160 penalty .

    • Mail notice

    • The return posted to an incorrect tax period and has to be reprocessed, and

    • Either the receiving or losing module contains an -A Freeze

    Void the notice.
    • If box 1 above applies, and

    • The notice module contains excess credit, and

    • The TC 976 tax liability on CC BMFOL or CC BRTVU matches the excess credit amount

    Void the notice.
    The notice module has an -A freeze with no current open control and there is a pending payment (TC 6XX) Label the notice.
    The notice module is in balance due status with no current open control and a payment is located. Transfer payment into notice module and determine the correct notice disposition.
    If payment found on Losing module that contains A Freeze and no open control base. Transfer payment into notice module and determine the correct notice disposition.
    The notice module has an -A freeze with no current open control. Mail the notice. Do not assess TC 160
    Controlled to a tax examiner outside Accounts Management Contact the tax examiner for case resolution (notice disposition, etc.) for all other instances see IRM 3.14.2.7.1 and IRM 3.14.2.7.19.1 .
    There is a pending adjustment with no Hold Code or Hold Code 1 on the notice module. Label the notice.
    CP 267 Refer to IRM 3.14.2.7.8.

3.14.2.7.5.2  (01-01-2015)
STEX Freeze (-B)

  1. This freeze prevents credits from refunding or offsetting (including Credit Elect) from the module.

  2. It is set when the Statute of Limitations for refunds expires.

  3. You must contact the Statute Unit for all notices with a tax increase selected with a -B Freeze to determine notice disposition. Use chart below for disposition.

  4. Follow any special instructions given by the Statute Unit when making an adjustment to the tax module.

  5. If increasing the tax, input a HC 4 to hold any remaining credit.

  6. If transferring credit with a TC 820, input a secondary TC 570 on the debit side of the transfer to create a -R Freeze and hold any remaining credit on the module.

  7. Any of the following actions will release the freeze:

    • TC 820

    • The module balance becomes zero or debit, or less than $5.00 credit.

    IF THEN
    Notice with refund selected with -B Freeze Void the notice.
    Notice with tax increase selected with -B Freeze Contact the local Statute Unit. Your contact should state that if you do not receive any instructions from the Statute Unit before cycle closeout, the notice will be voided.

3.14.2.7.5.3  (01-01-2015)
Offset Overflow Freeze (C-)

  1. This freeze delays a TC 846 for one or two cycles.

  2. Master File generates this freeze when an offset overflow (computer capacity exceeded) exists.

  3. Follow normal review procedures.

  4. If the delayed refund needs to be reduced:

    1. Hold the notice.

    2. Monitor the case for posting of the TC 846.

    3. Delete the refund.

3.14.2.7.5.4  (01-01-2015)
Refund Statute Expiration Date (RSED) Freeze (-D)

  1. This freeze prevents credits from refunding or offsetting (including Credit Elect) from the module.

  2. It is set when a TC 29X or TC 30X (Doc Code 47 or 54) posts and creates a credit balance that is comprised of pre-paid credits (credits posted by the due date of the return) and the RSED has expired.

  3. The following conditions will release the freeze:

    • A TC 29X with a Priority Code 4 posts to the module

    • The module balance becomes zero or debit

      Caution:

      Contact the Statute Function before making any adjustment.

3.14.2.7.5.5  (01-01-2015)
Amended Return Freeze (E-)

  1. This freeze prevents overpayments from refunding or offsetting into or out of the frozen module.

  2. The following conditions will set this freeze:

    • No original return (TC 150) has posted, but a duplicate (TC 976) return posts to a tax module

    • TC 971 Action Codes 010, 012, 013, 014, or 015 is input

  3. Any of the following actions will release the freeze:

    • TC 150

    • TC 971 with Action Code (AC) 002

    Note:

    If the case is controlled to a Tax Examiner (TE), contact the tax examiner for case resolution.

3.14.2.7.5.6  (01-01-2015)
Rollback Freeze (-E)

  1. This freeze prevents credits from offsetting into a debit module the computer has performed a rollback analysis on or to a debit module that has no modules in status 22, 23, 24, or 26 for the previous 12 months.

  2. Any of the following actions will release the freeze:

    • Computer released after 10 cycles

    • The credit discrepancy is resolved

    • The module balance becomes zero or credit

    • The module reaches status 22, 23, 24, or 26

      Caution:

      Overpayments must be transferred into modules with -E Freezes only if the credit is claimed on the module, intended to be applied, or the taxpayer requested the credit transfer.

3.14.2.7.5.7  (01-01-2015)
Math Error Freeze (G)

  1. This freeze grants Appeal Rights to the taxpayer and prevents the tax module from updating to TDA status.

  2. One of the following conditions usually sets this freeze:

    • An original return with a Math Error Notice Code (TPNC) posts to the module

    • An adjustment in Blocking Series 770–789 posts to the module

  3. The freeze will automatically release in twelve weeks. Any of the following actions will release it earlier:

    • TC 472 with Closing Code 94

    • TC 290 with Priority Code 6

3.14.2.7.5.8  (01-01-2015)
Restricted Failure to Pay Penalty Freeze (G-)

  1. This restricts the Failure to Pay penalty.

  2. Any of the following conditions will set the freeze:

    • TC 270/271 (except with Reason Code 62)

    • TC 320 (Return due date is before 1–1–87)

    • TC 534 (for significant amount)

    • TC 780 with a TC 480

  3. Any of the following actions will release the freeze:

    • TC 272 (zero amount)

    • TC 321

    • TC 535 (if the TC 534 amount is completely reversed)

    • TC 781 or TC 782

  4. Manually compute the penalty and retype the notice if necessary.

    Note:

    Any transaction with Doc Code 52 will restrict FTP penalty and interest (credit and debit) in the module with that transaction. This restriction is permanent and cannot be released. This condition does not set the G- freeze. Nevertheless, manual penalty and interest computation is required. Exception: A transaction with Doc Code 52 with Julian Date 999 will not restrict the Failure to Pay penalty and interest.

3.14.2.7.5.9  (01-01-2015)
Restricted Credit Interest Freeze (I-)

  1. This freeze restricts credit interest.

  2. One of the following conditions will set the freeze:

    • TC 770

    • TC 780

    • TC 534 (for significant amount)

  3. Any of the following actions will release the freeze:

    • TC 771

    • TC 772

    • TC 535 (must completely reverse TC 534 amount)

    • TC 781 or TC 782

    • Net module balance becomes zero or debit

    Note:

    Any transaction with Doc Code 52 will restrict FTP penalty and interest (credit and debit) in the module with that transaction. This restriction is permanent and cannot be released. This condition does not set any I freeze. Nevertheless, manual penalty and interest computation is required. Exception: A transaction with Doc Code 52 with Julian Date 999 will not restrict the Failure to Pay penalty and interest.

  4. Follow normal review procedures.

3.14.2.7.5.10  (01-01-2015)
Restricted Debit Interest Freeze (-I)

  1. The –I (Debit Interest) Freeze sets when a manual abatement or assessment requirement is placed on an account. The –I Freeze is generated when a TC 340/ TC 341 posts or when CCC “Z” is placed on an account identifying combat zone taxpayers entitled to an automatic postponement of a deadline. You must manually compute interest on adjustments input on an account with the –I Freeze. It also prevents credits from refunding or offsetting into or out of the module for eight weeks.

  2. A TC 340/341 sets this freeze.

  3. TC 342 will release this freeze.

  4. Manually compute the interest and retype the notice if necessary.

    Reminder:

    Electronically document reason for action taken when available to function inputting adjustment.

    Example:

    If case is located on Accounts Management Services (AMS) system and/or the CIS (Correspondence Imaging System) - effective February 17, 2009 renamed as AMS (Accounts Management Services) - notate the following in case history:
    • reason interest has been restricted
    • relevant interest computation dates/amounts for that adjustment
    • any specific information helpful in reconstructing the posted restricted interest adjustment.

    Reminder:

    Any transaction with Doc Code 52 will restrict FTP penalty and interest (credit and debit) in the module with that transaction. This restriction is permanent and cannot be released. This condition does not set any I freeze. Nevertheless, manual penalty and interest computation is required. Exception: A transaction with Doc Code 52 with Julian Date 999 will not restrict the Failure to Pay penalty and interest.

  5. For a complete list of conditions for -I Freeze refer to IRM 20.2.8.6.

3.14.2.7.5.11  (01-01-2015)
Credit Balance Freeze (-K)

  1. This freeze prevents the credit balance from refunding or offsetting from the module.

  2. Any of the following conditions will set the freeze:

    • TC 29X with Hold Code 1, 2, or 4

    • TC 30X with Hold Code 1, 2, or 4

    • Form 1120 with CCC "N" (Joint Committee Case) is posted

      Note:

      A TC 290 .00 with Hold Code 4 sets this freeze on a refund delete case.

    Caution:

    Do not set a –K freeze unless it is necessary for case resolution. Be aware of the conditions for the release of the freeze. Do not release a refund erroneously.

  3. Any of the following actions will release the freeze:

    • TC 150 posts to the module

    • TC 29X posts to the module

    • TC 30X posts to the module

    • TC 820 posts to the module

    • TC 830 posts to the module

    • A Doc Code 24 or 34 credit transfer

    • The module balance becomes zero or debit

3.14.2.7.5.12  (01-01-2015)
Form 2290 (L-)

  1. This freeze is set when MFT 60 (Form 2290) module has a credit balance of $10.00 or more.

    1. The freeze was created to prevent erroneous refunds.

    2. The credits are recorded on the Form 2290 Credit Report which is worked by the Excise Group at Cincinnati Campus.

    3. The module is frozen from refunding and offsets.

  2. The Excise team in Cincinnati can be reached by calling 859-669-5728 or 859-669-5732.

3.14.2.7.5.13  (01-01-2015)
AIMS Indicator Freeze (-L)

  1. A TC 420 or TC 424 sets this freeze.

    Note:

    This freeze will not prevent a refund.

  2. Follow normal review procedures.

    Note:

    If a CC REQ54 adjustment is needed, use Priority Code 1.

  3. Freeze is released by certain TC 30X or TC 42X transactions.

3.14.2.7.5.14  (01-01-2015)
Disaster Freeze (-O)

  1. This freeze is set by TC 971 (Action Code 086 or 087).

  2. Please refer to IRM 3.14.2.7.4.3, Natural Disaster Procedures, for more information.

3.14.2.7.5.15  (01-01-2015)
Refund Deletion Freeze (P-)

  1. This freeze prevents overpaid balances from refunding or offsetting from the module.

  2. Any of the following conditions will set the freeze:

    • TC 720

    • TC 841

    • TC 842 with a posted TC 150

  3. Any of the following actions will release the freeze:

    • TC 29X posts to the module

    • TC 30X posts to the module

    • TC 721 posts to the module

    • TC 722 posts to the module

    • TC 820 posts to the module

    • TC 830 posts to the module

    • A Doc Code 24 or 34 credit transfer

    • The module balance becomes zero or debit

    Caution:

    If an open control base is on the module regardless of status, do not release the freeze without contacting the originator.

3.14.2.7.5.16  (01-01-2015)
Rollover Freeze (Q-)

  1. The Q-Freeze is set when a return posts with unclaimed excess credits.

  2. The account is frozen from refunding or offsetting for 15 cycles for MFTs 01, 02, 03, 10, 11, 12 and 33.

  3. Any of the following actions will release the freeze:

    • Automatically at the end of 15 cycles

    • A TC 652 or TC 662 posts and remaining credits are within $10.00 of the claimed amount (including penalties and interest)

    • A TC 290 .00 with Hold Code 3 and Priority Code 4 posts

    • The module balance becomes zero or debit

3.14.2.7.5.17  (01-01-2015)
Additional Liability Freeze (-R)

  1. A manual or systemic TC 570 sets this freeze.

  2. Any of the following conditions will generate a TC 570:

    • A TC 150 with CCC X posts

    • A TC 291 with Priority Code 7 posts

  3. Any of the following actions will release the freeze:

    • TC 571

    • TC 572

    • TC 29X

    • TC 180 posts for zero to a module with an unreversed TC 186

    • The module balance becomes zero

3.14.2.7.5.18  (01-01-2015)
RPS Multiple 610 Freeze (R-)

  1. Any of the following actions will set this freeze:

    • Multiple TC 610s on module when the TC 150 posts

    • Multiple TC 610s posted with no TC 150 posted on module

  2. Any of the following actions will release the freeze:

    • TC 29X

    • TC 30X

    • TC 612 (to reverse the TC 610)

    • The module becomes zero or debit

3.14.2.7.5.19  (01-01-2015)
Undelivered Refund Check Freeze (S-)

  1. This freeze prevents any overpayment from refunding. It also causes a CP 231 to be issued to the taxpayer.

  2. A TC 740 sets the freeze

  3. Any of the following actions will release the freeze:

    • TC 018

    • TC 742 (net of all TC 74X is zero and debit)

    • TC 014

    • The module balance becomes zero or debit

3.14.2.7.5.20  (01-01-2015)
Outstanding Liability Freeze (V-)

  1. This freeze indicates an outstanding liability on another tax account.

  2. A TC 130 sets this freeze.

  3. Any of the following actions will release the freeze:

    • TC 131

    • TC 132

    • TC 824

  4. Follow normal review procedures.

3.14.2.7.5.21  (01-01-2015)
Bankruptcy Freeze (-V)

  1. This freeze causes the Campus Status to become 72.

  2. A TC 520 with Closing Codes 60-67, 83, 85-89 sets the freeze.

  3. A TC 521/522 with Closing Codes 60-67, 85-89 releases the freeze.

  4. Follow normal review procedures.

  5. If during review, it is decided that the Territory Office Special Procedures function needs to be contacted:

    1. Give the case to the work lead.

    2. The work lead will contact the Territory Office Special Procedures function for case resolution.

    3. The work lead will return the case to the tax examiner with instructions for case resolution.

    4. The tax examiner will resolve the case.

3.14.2.7.5.22  (01-01-2015)
Claim Pending Freeze (W-)

  1. This freeze indicates that a claim is pending.

  2. A TC 470 or TC 976 posting to a balance due module sets the freeze.

    Note:

    A TC 470 without a Closing Code or with a Closing Code 90 will prevent offsets into the account.

  3. Follow normal review procedures.

  4. If during review it is decided that the Territory Office Special Procedures function or the Appeals Office needs to be contacted:

    1. Give the case to the work lead.

    2. The work lead will contact the Special Procedures function and/or Appeals Office for case resolution. (To inquire about the status of a case in Appeals Office, call the Appeals Customer Service Line at (559) 233-1267.)

    3. The work lead will return the case to the tax examiner with instructions to resolve the case.

    4. The tax examiner will resolve the case.

3.14.2.7.5.23  (01-01-2015)
Litigation Pending Freeze (-W)

  1. A TC 520 with various closing codes sets this freeze.

  2. Follow normal review procedures.

  3. If during review it is decided that the Territory Office Special Procedures function or the Appeals Office needs to be contacted:

    1. Give the case to the work lead.

    2. The work lead will contact the Special Procedures function and/or Appeals Office for case resolution. (To inquire about the status of a case in Appeals Office, call the Appeals Customer Service Line at (559) 233-1267.)

    3. The work lead will return the case to the tax examiner with instructions to resolve the case.

    4. The tax examiner will resolve the case.

3.14.2.7.5.24  (01-01-2015)
Accounting Manual Refund Freeze (-X)

  1. A manual refund worked by Accounting sets this freeze. Follow normal procedures.

3.14.2.7.5.25  (01-01-2015)
Offer In Compromise Freeze (-Y)

  1. A TC 480 or TC 780 sets this freeze.

  2. Give the case to your Work Lead who will email the appropriate Offer in Compromise mailbox below:

    Email Address: For Taxpayers Residing In:
    *SBSE COIC Memphis Alaska, Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Hawaii, Idaho, Kentucky, Louisiana, Mississippi, Montana, North Carolina, New Mexico, Nevada, Oklahoma, Oregon, South Carolina, Tennessee, Texas, Utah, Washington, Wisconsin, or Wyoming
    *SBSE COIC Brookhaven California, Connecticut, Delaware, District of Columbia, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New York, North Dakota, Ohio, Pennsylvania, Rhode Island, South Dakota, Vermont, Virginia, West Virginia, Puerto Rico, or has a foreign address

3.14.2.7.5.26  (01-01-2015)
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

  2. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

  3. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Exception:

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

3.14.2.7.6  (01-01-2015)
Additional Review Requirements

  1. After completing the General Review procedures located in IRM 3.14.2.7.1, continue with the following instructions found in IRM 3.14.2 as appropriate:

    • Math Error Condition - IRM 3.14.2.7.7

    • CP 267 and CP 268 - Q- Freeze - IRM 3.14.2.7.8

    • Balance Due Notices - Non-Math Error IRM 3.14.2.7.9

    • Reviewing Notices with Remittance Processing System "RPS" indicators - IRM 3.14.2.7.11

    • Refund Transcripts - IRM 3.14.2.7.12

    • Required Payment or Refund under Section 7519 - Form 8752 - IRM 3.14.2.7.13

    • Adjustment Notices - IRM 3.14.2.7.14

    • Selection Keys - Additional Review Required for Notices Generated Under Keys 09, 33,52, 54, 55, and 91 - IRM 3.14.2.7.15

    • CP 173 - ES Penalty - IRM 3.14.2.7.16

3.14.2.7.7  (01-01-2015)
Math Error Condition

  1. A math error notice generates whenever a mathematical error is made by the taxpayer on the return or the posted payment information does not agree with the amount claimed on the return.

    1. The taxpayer notice code (TPNC), also called the math error code, is a two-digit numerical code assigned by ERS or ECC-MTB for the specific error condition.

    2. The computer translates this code into a literal message that prints on the math error notice.

    3. This message notifies the taxpayer of the error on the return or account.

  2. Complete all general review procedures in IRM 3.14.2.7.1before reviewing the math error condition. The return may or may not be included with the NRPS package, depending on the error condition.

  3. The Main Math Error Notices

    1. Overpayment Notices are:

      Math Error Overpaid Notices
      Return Computer Paragraph Notice
      940, 940-EZ 111
      941, 943, 944, 945 112
      CT-1, CT-1X 113
      720 114
      11-C, 2290, 706, 709, 730 115
      5227, 990PF, 4720 116
      1042 117
      1120, 1120X, 1041, 1120-C, 990-T 133
      720, 940, 940-EZ, 941, 943, 944, 945, 1120, 1120-C, 1120X, 1041 268
    2. Even/Balance Due Notices

      Even Balance/Balance Due Notices
      Return Computer Paragraph Notice
      940, 940-EZ 101
      941, 943, 944, 945, 941X, 943X, 944X, 945X 102
      CT-1, CT-1X 103, 123
      720 104, 124
      11-C, 2290, 706, 709, 730 105, 125
      5227, 990PF, 4720 106, 126
      1042 107, 127
      1120-C, 1120X, 990-T, 1041, 1120 131, 131A and 132
  4. The balance due non-math error notices are the CP 161 (all returns except Form 1065) and CP 162 (Form 1065 and 1120-S)

  5. The overpaid non-math error notices generated at return settlement (TC 150) are the CP 267 (Q- Freeze), the CP 173 (ES Penalty notice) and the CP 210 (adjustment notice):

  6. To view an exhibit of a notice go the Office of Web Site at http://gatekeeper.web.irs.gov/snipmain.aspx


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