3.17.79  Accounting Refund Transactions (Cont. 1)

3.17.79.6 
Standard Form (Form) 1166, Voucher and Schedule of Payments and Secure Payment System (SPS)

3.17.79.6.3 
Contingency Dial Up and Manual Standard Form (Form) 1166, Voucher and Schedule of Payments

3.17.79.6.3.2  (01-01-2015)
Form 813, Document Register

  1. Prepare Form 813, Document Register, in duplicate, for each block of 100 or less items.

    1. Enter in "Block DLN" the first eleven digits of DLN assigned to Form 3753. Enter Transaction Code (TC) 840 in appropriate block and note "MANUAL REFUND" on top of the Form 813.

    2. List the amount(s) from each Form 3753 on the Form 813 line with the serial number corresponding to the document.

    3. If interest is shown on Form 3753, enter it separately in brackets and to the right of total amount of the refund check to be issued. In the example below, the $3.20 is included in the $350.00 as well as being separately listed.

      Example:

      350.00 (3.20)

    4. Enter the total of check amounts preceded by accounting sign "Dr" . This identifies the total amount as a "debit" . Enter the total of the bracketed interest amount to the right of the check total amount.

    5. Circle the document count at the appropriate preprinted serial number. This is the number, plus one, of the last refund amount. For a single item circle "01" .

  2. Enter DLN of return or related credit source document on Form 3753. Detach original and duplicate from return; leave triplicate copy attached.

3.17.79.6.3.3  (01-01-2015)
Distributing Posting Documents

  1. Disposition of documents:

    1. Hand carry original Form(s) 3753 and Form 813 to Batching for input, according to cycle, per IRM 3.11.10, Revenue Receipts.

    2. If account is on IDRS, release to Batching for input in next cycle.

    3. If account is on retention, hold for appropriate cycle, then release.

    4. The manual refund request may specify cycle.

    5. Prepare appropriate transmittal form. Send the second copy of Form 3753, Form 813, and Form 1166 to Redesign Revenue Accounting Control Systems (RRACS).

    6. Form(s) 813 (duplicate copy) is used for preparation of Master Control Record (MCR) per IRM 3.17.30, SC Data Controls.

    7. Form(s) 3753 (duplicate copy) is returned from RRACS or Redesign Revenue Accounting Control System when refund confirmation is received from the RFC. The Form 3753 is retained with copy of Refund Schedule.

      Note:

      If required, TC 841 with same date as TC 840 (schedule date) and an amount not greater than the TC 840 is used to reverse TC 840.

  2. Prepare Form 8166, Redesign Revenue Accounting Control System (RRACS) Input Reconciliation Sheet, from triplicate copy Refund Schedule/Form 1166. See IRM 3.17.63, Redesign Revenue Accounting Control System.

    1. Tape Data Control Sheets.

    2. Verify debit items are included in input tapes for MF entry.

    3. The RACS team inputs this data from serially numbered Form 8166 and enters the number on the related Form 1166.

    4. Enter the Net Tax Refund Report (NTRR) line item information on the triplicate Form 1166 from Form 3753.

    5. File in Form 8166 file.

  3. Hold the triplicate copy of Form 1166 and duplicate Form 3753 in Manual Refund file for further processing after the confirmed Form 1166 arrives from the RFC via Intra-governmental Payment and Collection System (IPAC; formerly known as GOALS).

    1. Review the Manual Refund hold file once a week.

    2. Follow-up with the RFC on items that are older than five (5) workdays.

    3. If a pattern of overage items is noticed, contact the Chief Financial Officer, Office of Revenue Systems, Attn: Revenue Accounting Section, OS:CFO:R:S at ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

    4. Fold triplicate Form 3753, if necessary, and associate with return or case file of initiator. If return is not available (for example, tentative carryback), associate triplicate copy with case file.

  4. Send returns for sorting, examination, coding, blocking, numbering, or to files, as appropriate. Dual Status for MS 1040 (AUSC DO 98 only) is returned to Reject Examination for clearance from the Reject Register and input to the Master File.

  5. BMF Manual Refunds:

    1. New BMF NMF accounts will be directed to the Cincinnati Center.

    2. Process BMF manual refunds through the RFC which normally receives refund transactions for other types of taxes.

    3. Changes may occur from the Transshipping Guidelines published by W&I Project Management Office (PMO) staff. Refer to the Submission Processing Web Page and SERP Transshipping links.

3.17.79.6.4  (01-01-2015)
Bureau of Fiscal Services Secure Payment System

  1. The Bureau of Fiscal Services (BFS), Secure Payment System (SPS) was developed by BFS to certify disbursements for all Federal agencies. SPS automates refund schedule preparation, certification, transmission and verification of the Form 1166, Voucher and Schedule of Refunds. SPS replaces the manual or paper Form 1166 and continuation sheet. SPS is user-friendly, menu screen driven, with microcomputer programs automating two distinct processes:

    1. The certification process, a designated Certifying Officer certifies (or attests in writing) that disbursements to be made by the Federal Government are legal, proper and correct. See also IRM 3.17.79.1.8, Certifying Officer Review, and 1.2.40.20, Delegation of Authority # 28, Designation of Officer and Employees as Authorized Certifying Officers.

    2. The scheduling process, is the IRS transmission to BFS of detailed payment data records; the payee amount, identification number and related inscription information printed on the face of the check and/or summary information from Enterprise Computing Company (ECC) - Martinsburg. See further references at IRM 3.17.79.2.2, Generated Refunds, Tapes and Schedules and IRM 3.17.79.4.3, Certifying the IDRS Generated Refund (IGR) Tape.

    3. SPS is the preferred method for certifying tax refund disbursements. Paper Form 1166 should be used only in rare circumstances and is considered the contingency for SPS system transmission failure.

    4. BFS assures National Office that should difficulties occur with certifying payments via SPS, The Kansas City, BFS will contact customers to redirect certifications via SPS. If this does not occur, please advise National Office.

  2. Paper Form 1166 format procedures are in the Voucher Schedule Preparation Manual (October 1989) prepared by the Regional Financial Center.

  3. BFS's Intra -governmental Payment and Collection System (IPAC, also formerly known as GOALS) for confirming refund schedule information has also developed a User Guide available at the following web address: http://fms.treas.gov/ipac/index.html. IPAC is an Internet-based system which replaced several applications on DOS GOALS (224, OPAC, RITS and TRACS), and requires Internet access, browsers and versions with User ID and Passwords.

  4. SPS procedures are published on the BFS site http://fms.treas.gov/sps/index.html.

  5. Three important differences between Form 1166 formats and the SPS formats are:

    1. ACCOUNT SYMBOL: This field (16 alphanumeric characters) replaces the former appropriation code field. The first seven characters are mandatory. The first two characters must be the first two characters of the ALC and is part of the transmission validation process. Additional characters are as follows for tax refunds only:

        Enter 20X0903 for a refund without interest and
        Enter 20X0903/04 for a refund with interest
    2. REMARKS This field has two lines (40 alphanumeric characters for each line).

      Note:

      The DEO User Guide shows this field as Payment ID Lines for Enclosure Code 0 and 1 only.

      Caution:

      THE INFORMATION YOU ENTER ON LINE 1 AND 2 WILL AUTOMATICALLY PRINT ON THE PAYMENT CHECK. Enter information as shown below:

      Line 1 Enter MFT and Period
      Sample: 02/200912
      Line 2 Enter the two digit line number, a space, the word "Interest" and the amount (if necessary)
      Sample: 61 INTEREST 343.29
    3. CHECK SERIAL NUMBER RANGE SPS does not designate a space for the beginning and ending range numbers. The information from the GOALS confirmation listing will be entered on the file copy of the SPS document.

3.17.79.6.4.1  (01-01-2013)
Maximum Payment Amounts

  1. TFM Bulletin 97–07 dated August 1, 1997 increased the maximum amount for which IRS may certify payments for paper checks, Automated Clearing House (ACH) electronic payments and FEDWIRE Same Day Pay Refund electronic payments issued by the Regional Financial Centers. Same-day-pay refunds, however, carry unique prerequisites and must be issued only under case-by-case restrictions.

  2. The maximum amount depends on the type of refund schedule IRS submits to BFS. For example, maximum amounts for each instrument request (e.g., paper check, ACH electronic payment and FEDWIRE Same Day Pay Refund electronic payment) are as follows:

    1. Paper check with automated processing for maximum individual payments up to $9,999,999.99. Certify via either the Secure Payment System (SPS) or paper Form 1166.

    2. Paper check with manual processing for maximum individual payments of up to $99,999,999.99. Voucher Schedule and certify on SPS or paper Form 1166.

    3. ACH electronic payments for maximum individual payments of up to $99,999,999.99. Certify via the SPS or paper Form 1166.

    4. FEDWIRE electronic payments with electronic or manual processing for maximum individual payments of up to $999,999,999.99. Certify via the SPS or paper Form 1166.

  3. Large dollar payments: Agencies have an option to:

    1. Certify into multiple checks with individual amounts up to $9,999,999.99. Certify via SPS.

    2. Certify one check up to $99,999,999.99 via paper Form 1166 (or multiple checks if total is greater than $99,999,999.99).

3.17.79.6.4.2  (07-18-2014)
Certifying Automated Clearing House (ACH)/Direct Deposit Hardship Refunds

  1. Regional Financial Center SPS Systems Administrators installed special software for SPS screen menu options for Next Day and Same Day Payment Refund selections.

  2. This is considered exception-processing. Because of this out of the ordinary, manual process, it runs a very high risk for disbursement losses (e.g., also known as erroneous refunds). The Submission Processing Director is the Accountable Officer over any lost revenue or disbursement loss. Cases of hardship Direct Deposit refund requests must be controlled and monitored closely by the Taxpayer Advocate Service to prevent misuse of this method or the release of erroneous refunds.

  3. Due to the inherent risk of error, initiators must:

    1. Follow IRM 21.4.4, Manual Refunds regarding the controlling of cases. Each refund document received in accounting must have an open control base or it will be rejected (IRM 3.17.79.3.2.1). The intent of the open control base is to monitor the account to ensure posting of the TC 840 and prevent any potential duplicate refunds.

    2. Research accounts via nationwide account research (Universal IDRS, CMODE, IMFOL, CFOL, etc.).

    3. Monitor (IDRS typically in 'M' status) for the TC 840 to post to taxpayer Master File account.

    4. Stop duplicate refunds, either manual (TC 840) pending or generated (TC 846).

      Note:

      CC NOREF will no longer intercept a posted TC 846 on an IMF account.

  4. Requests for direct deposit refunds (Form 3753 ONLY) submitted by Taxpayer Advocate Service are required to include supporting documentation (typically, the justification for the disbursement of credit). Evidence of hardship is required (i.e., 3rd party verification or a signed statement by the LTA verifying the hardship exists). Cases received must be completed and contain all required supporting documentation. In addition to IRM 21.4.4, Manual Refunds, TAS will provide the following as appropriate to substantiate ACH/Direct Deposit (DD) manual refunds:

    1. Proof of economic hardship to support issuing an ACH/DD manual refund.

    2. Proof from bank that a savings or checking account exists and it is the account of the taxpayer or a voided check. Use discretion when taxpayer accounts are Married Filing Joint (MFJ).

      Note:

      Accounting will issue ACH/DD refunds to a savings or checking account that is listed in one of the Married Filing Joint (MFJ) taxpayers ONLY when an injured spouse claim has been filed (copy attached). The name on the savings or checking account MUST match the name of the taxpayer identified as the injured spouse, NO EXCEPTION

      .

    3. ACH/DD on Form 3753 must include third party verification of hardship. If 3rd party verification is not present, request a signed statement by the LTA verifying that the hardship exists. The signed statement must be submitted with the manual refund request (this is in addition to the manual refund being signed by the LTA).

    4. See IRM 21.4.4, Manual Refunds, for instructions on how to research accounts and prepare Form 3753 (Rev. 1-2010), Manual Refund Posting Voucher. Document 6209, ADP, Section 6, describes necessary research and monitoring requirements for originators of manual refunds.

  5. The Submission Processing, Accounting Operation, Manual Refund function, receive perfected Form 3753 from all Business Operation Divisions (BOD) and Field offices. A perfected Form 3753 means: the request is appropriate for the expedite processing and high risk of error associated with this exception process, the originators have researched and will continue to monitor accounts, and have cited the authority for requesting the refund through the exception process. It is important that the request has been initiated by the appropriate management official (or area) to approve the manual refund for disbursment. Form 3753 must be reviewed and approved by the designated Authorized Officials formally delegated the authority to sign the manual refund request.

  6. Accounting must verify that Form 3753 is complete and that supporting (back-up) documentation is attached. See IRM 21.4.4, Manual Refunds, for complete instructions for initiating a manual refund.

  7. Section II, Manual Refund Authority, Section II, Control Base Opened must be checked, Section III, Interest Computation. Mark applicable items and record authority and IRM references.

  8. Section IV, Other Remarks, Section IV, initiating BOD must be included.

    1. If the "No (Do Not Allow TOP Offset, BPI-3 )" box is checked in Section II the manual refund iInitiator must verify that no debts exist and notate"no agency debts verified with the BFS, name of BFS individual, date and telephone number." This statement must appear in the Other Remarks section on the Form 3753.

      Note:

      Exception, Form 8038CP is not subject to offset.

    2. If a debt exists, contact BFS. See IRM 21.4.6, Refund Inquiries—Refund Offset, for instructions to contact BFS.

    3. Write "DD request (e.g., Form 911 or hardship determination.)" .

  9. Section V, Approval.

    1. Box 1. Signature of Authorized Official. This signature must match the signature of the authorized management official on file with the Manual Refund function.

    2. Box 2. Signer's SEID, Printed Name and Title

    3. Box 3. Printed Name, and SEID of initiator.

    4. Box 4. Date Signed.

    5. Box 5. Initiator's telephone number.

  10. Manual Refund Units will verify the RTN and DAN (Checking or Savings) in Section 1, Box 11, with the supporting credit source documentation. Supporting documentation includes:

    1. Proof of hardship to support issuing as an ACH/DD manual refund ,e.g., Eviction Notice (Court Papers signed by presiding Judge), Official Notice (from water, electric or gas company), Medical Emergency (Physician's statement).

    2. Proof (letter/statement from bank or voided check) that account exists and it is the account of the taxpayer must be received with manual refund request, when other than original refund of an electronically filed return. ONLY ISSUE to 3rd party accounts (Refund Anticipation Loan-RAL or Refund Anticipation Check-RAC) if the manual refund request is the original refund of an electronically filed return and proof of account number is verified with an attached copy of the TRDBV print of the original return RAL/RAC account. A RAL or RAC, are contracts between the taxpayer and financial institutions (via tax preparer).

      Note:

      RAL/RAC accounts are only valid for the refund requested on the original electronically filed return. RAL/RAC accounts loses its validity after the issuance of the original requested refund. Therefore, Accounting will not honor subsequent refunds into these types of financial accounts.

      See IRM 21.4.4, Manual Refunds.

      Note:

      If the taxpayer files MFJ (FS2) then account information must be provided that shows the account reflects both names, unless the filing status is MFS (FS3). As a safeguard against Fraud and other security issues, a signed statement by the other spouse does not verify to IRS that (s)he is the joint taxpayer listed on the account. DO NOT ACCEPT SIGNED STATEMENTS from taxpayer. Possible fraud issues may exist. If documentation can not be provided that the account belongs to both taxpayer(s) the refund will be issued as a paper check on Form 5792.

    3. ACH/Direct Deposit Form 3753 manual refund requests submitted to Accounting Operations must include the 3rd party verification of the hardship (e.g., a copy of the eviction or utility shut-off notice).

      Exception:

      If 3rd party verification is not present, look for or request a signed statement by the LTA verifying that the hardship exists. The signed statement must be attached to the manual refund request (this is in addition to the manual refund being signed by the LTA). Maintain copy of refund document and statement in audit file.

      Remarks block on Form 3753 must indicate Form 911 or hardship determination. Requests without appropriate backup documentation or remarks stating the 911 hardship condition, will be issued as a paper check (3-5 days ).

      Note:

      When a RAL is denied, the deposit account on the original return will convert to a RAC. CC TRDBV will not update or reverse current information. Accounting will deposit the refund into the account listed on the original return. See bullet (b) above.

      Exception:

      If the RAL/RAC account was not accepted or approved by the financial institution/tax preparer. TAS will obtain a denial letter (including the refund amount) and attach to the refund document in order for the refund to be deposited into a financial account not present on the original return. See (4)b above for required documentation. Maintain copy of refund document and letter in audit file.

    4. Interagency/bureau refunds will not always contain specific taxpayer identifying information. Typically these types of refunds will be a result of special investigations, testing and binding agreements. Look for the official governing memorandum authorizing the direct deposit refund. Also, the funds to be refunded will come from specific fund accounts (general ledger or appropriations). See also IRM 3.17.79.3.10(7) for additional information.

    5. Taxpayer Advocate Service (TAS) ACH/DD manual refund requests originating from Unprocessed Original Returns will contain the following:

      • The first page of Form 1040, 1040A, 1040EZ, etc. to show correct Entity information and official IRS receive date stamp.

      • The systemic validated screen print from REJECTS or

      • The Form 1040 page with Reject employee initials next to the refund amount. This is used only if TAS has a hardship case that does not allow the 5 day wait for the screen print from Rejects. The P&A analyst assigned the TAS Division duty will walk the return to Rejects for manual validation. The Reject employee will initial Form 1040 next to the refund amount indicating the refund has been validated. See 3.17.79.3.3.2.

    6. Taxpayer Advocate Service (TAS) can only gain approval from Fresno and Kansas City ACS Centers, which are the designated sites for approving and processing Refund Hold OAR(s), see IRM 25.12.1.9(3). The Refund Hold Program holds individual income tax refunds and credit elects when a current year refund return is filed and the taxpayer's account has at least one non-filed tax return within the five years prior to the Refund Hold tax year. The Refund Hold account will contain a TC 570 w/999 in the Julian date field of the DLN (digits 6, 7, 8). Manual Refund requests submitted by TAS for Refund Hold Accounts must contain:

       
      • a copy of the OAR (Operations Assistance Request) signed by the ACS TAS Caseworker designated at Fresno or Kansas City Centers. REJECT back to TAS if OAR is not signed by a ACS TAS Caseworker/coordinator.

      Note:

      Accounts Management has the authority to request manual refunds on Refund Hold accounts (IRM 25.12.1.12.2) only when processing Injured Spouse claims on Form 8379. These cases will not have an OAR attached. These cases will have approval from the Fresno and Kansas City designated coordinators.

  11. Certify via SPS. Use Schedule Type/Sub-Type option Miscellaneous ACH.

    1. Use Schedule Number definer "F" for EFT/DD refunds.

  12. Prepare Form 813.

  13. Assign Document Locator Number (DLN) to Form 3753.

  14. Write Schedule Number and date on Form 3753, Section I, Boxes 5 and 6.

  15. Route Form 3753 to appropriate area for further processing.

3.17.79.6.5  (01-01-2015)
Special Uses of Standard Form (Form) 1166

  1. Request for Refund of Unassessed Revenues SPS/Form 1166 is for scheduling refunds of unassessed revenue collections, unassessed advance payments, or for miscellaneous refund items.

  2. When appropriate manual refund form, memorandum, correspondence, Claim Form 843, Unidentified Remittance Document, or advance payment case file and Part 2 of Form 3244A, Payment Posting Voucher Examination, authorizing a refund arrive in Accounting Operations:

    1. The individual refund items are scheduled identifying each payee and amount to be produced in the literal display printed on the face of the check for manual cancellations if the check is returned or undelivered. The refund checks are identified as: EXES, OFFER, SEIZURE or UNID.

    2. Record the IRS refund schedule number on documents authorizing refunds. See Exhibit 3.17.79–57 for description of refund schedule number format.

  3. The Refund Schedule/SPS/Form 1166 is processed as specified above, except that:

    1. No supporting documents are transmitted to the Regional Financial Center with the Form 1166.

    2. Form 3753 is returned to Files.

    3. Part 2, Form 3244A is returned to the computation clerk (deficiency) after entering the SPS/Form 1166 number in Remarks Block on the Form 3244A.

    4. Return the case file to the returns files group.

3.17.79.7  (01-01-2013)
Information Documents, Form 1099 and Form 1042S

  1. This section contains general instructions for preparing information documents when the Internal Revenue Service pays interest on manual refunds.

  2. Reporting interest paid is required by the Information Returns Program (IRP) and must be filed electronically with the IRP at Enterprise Computing Center.

  3. Specifications are published annually in Publication 1220, Specifications for Filing Form 1097-BTC, 1098, 1099, 3921, 3922, 5498, 8935, and W-2G Electronically (Catalog 61275P).

3.17.79.7.1  (01-01-2013)
Manual and NMF Refunds
Form 1099INT, Interest Income, Copies B To Recipient

  1. Receive all current year manual refund and NMF cases approved on Form 3753 and Form 5792 in the Certification function.

  2. Manual Form 1099INT are issued by IRS when more than $10 ($600 or more in some cases) in refund interest is paid. Form 1099INT, Copy B To Recipient, are computer generated on IMF and BMF accounts, except Corporation refunds, between January 1 and December 31 (through dead cycles) on manual refunds. Copy B To Recipient must be produced by the Manual Refund function during Master File dead cycles. Chief Information Officer (CIO) maintains the national program and transmits the Form 1099INT information returns to Enterprise Computing Center (ECC) Information Return Program (IRP).

    1. Procedures for submitting data to ECC; due dates and addresses are found in the Publication 1220, Specifications for Filing Form 1097-BTC, 1098, 1099, 3921, 3922, 5498, 8935, and W-2G Electronically.

    2. The due date for furnishing the required Copy B to Recipient (taxpayer) is usually by January 31. This requirement is described in Publication 1220 and in IRM 3.30.123, Processing Timeliness: Cycles, Criteria, Critical Dates.

    3. The due date for furnishing the 1099 information returns detail data to IRS Information Returns Program Payer Master File (IRP, PMF) at ECC is February 28. System Administrators files the appropriate national files electronically to ECC's IRP program.

    4. On NMF cases, a 1099-INT must always be manually prepared.

    5. All SPC sites maintain the national program (1099 Pro) and transmits manual refund interest Form 1099-INT information returns.

  3. Produce manual refund Form 1099-INT, Interest Income, (if not already prepared) for the interest amount paid on all manual and Non-Master File Accounts, if the interest paid by the Service to the recipient exceeds $10.00 or more for Form 1099-INT (and $600 or more for Form 1099C).

    1. Form 1099-INT should not be issued until it is certain that the refund will not be deleted. If refunds are deleted, Form 1099-INT should be adjusted or destroyed as appropriate.

    2. Form 1099-INT, Copies B to Recipient, must be received by recipients by January 31 annually.

  4. Entity data is entered by the Manual Refund function using disbursement posting documents (Form 3753 and Form 5792). The program provides a cumulative interest paid dollar amount per entity.

    1. Non-Master File accounts receiving interest amounts over the threshold receive Form 1099-INT when the Service paid interest on tax refunds.

    2. Data will be entered into the Automated 1099 program by Manual Refund function employees.

    3. The Manual Refund function verifies that all items are entered, produced, deleted as necessary, printed and Copy B To Recipient are mailed to taxpayers prior to January 31.

3.17.79.7.1.1  (01-01-2013)
Form 1099MISC Informant Awards (Ogden Center Only)

  1. Accounting will maintain a separate file of ALL manual refunds issued as Informant Awards (TAS 20x5433) to specifically issue Form 1099MISC.

  2. Form 1099MISC will be issued annually (received by the individual by January 30). Accounting will:

    • Contact the Informant Claim Exam (ICE) Team for a copy of Informant Award recipients to verify proper issuance

    • The award amount will be input in the box other income

    • There is no tolerance, all awards paid must be issued a Form 1099MISC

    • Issue Form 1099MISC on total amount approved by the Whistleblower Office regardless of any offsets

  3. After processing Form 1099 MISC is complete, forward a copy of the transmittal to the ICE Team and Small Business and Self-Employed (SB/SE) HQ analyst.

  4. See IRM 25.2.1, Information and Whistle Blower Awards - Receiving Information and IRM 25.2.2, Information and Whistle Blower Awards - Whistle Blower Awards for additional information.

3.17.79.7.1.2  (01-02-2013)
Releasing Perfected Form 1099INT For Manual Refunds

  1. IMF and BMF refunds authorized for scheduling prior to MF dead cycles will automatically generate Form 1099INT, Copy B To Recipient, for interest paid in excess of $10.00 ($600 or more in some cases). Manual refunds that do not post to master file (MF), the Accounting, Manual Refund function will manually prepare the Form 1099INT and mail to taxpayer. The Form 1099INT are not distributed until the refunds are issued and adjustments made on deleted items or items that have posted to the MF before the last cycle of the calendar year. See IRM 3.30.123, Processing Timeliness: Cycles, Criteria, Critical Dates.

  2. Items must reach batching prior to the last posting cycle for the calendar year. Master File Form 1099INT extracts occur during the last cycle of the calendar year.

  3. Manual refunds are scheduled and issued between January 1 and December 31, but the transactions are not loaded to the Master File until after Cycle 01 of the next processing year. Verify manual refunds were approved and posted prior to cycle 01 of the new processing year (e.g., CC REFAP'd no later than December 31).

  4. Verify the posting of IDRS refunds, a Form 1099INT for items posted to the MF prior to cycle 01 of the new processing should not be manually prepared.

3.17.79.7.1.3  (01-01-2015)
Transmitting Information Returns to IRS

  1. During the first week in January, after all manual refund Form 1099INT are prepared and issued, retrieve Copy A from the Suspense file. Systems Administrators will prepare Form 4804, Transmittal of Information Returns Reported Magnetically/Electronically. This 1096 or 4804 transmittal lists the issuing Submission Processing Center as the payer of interest. This manual procedure is only for use when Form 1099INT were not included through the Automated 1099-INT Program (centralized SA files these electronically to ECC) used for producing Form 1099-INT Copies B, To Recipient.

    1. For Form 1096 or Form 4804 filed, use Detroit Computing Center in the first name line to avoid Payer Master File unpostables.

    2. Enter Internal Revenue Service in the second name line.

    3. Use the SP Center address from which the Form 1099 is being issued as Filer's address.

    4. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ in Box 1.

    5. Enter total number of Forms 1099 in Box 3.

    6. Check the box at the bottom that represents the type of Form 1099 being transmitted.

    7. Associate Form 1096 or 4804 with proper Forms 1099 (Copy A) and forward to the Receipt and Control Branch for batching and input.

3.17.79.7.1.4  (01-01-2013)
Specifications and Annual Updates

  1. Systems Development staff update the application from the specifications described in Publication 1220, Specifications for Filing Form 1097-BTC, 1098, 1099, 3921, 3922, 5498, 8935, and W-2G Electronically (Catalog 61275P).

  2. Systems Administrator staff reviews the publication 1220 and the program to ensure the following will be produced or updated in the coding:

    1. updates program to reflect the current tax year;

    2. updates and verifies the correct title of the form and other annual changes as instructed in Publication 1220;

    3. for Copy B only, Recipient Copy, the IRS toll free telephone number appears on the Copy B, Recipient Copy as 1–800–829–1040;

    4. that each SPC site name and address appears in Payer's address field before releasing the program.

    5. test the application adequately, provide a User's Guide and offer technical assistance as necessary.

  3. Data must not be entered into the previous years program. Program changes are released in sufficient time for production by December annually.

  4. Transmitter control (TCC) numbers are assigned by ECC (the filer location, names and addresses).

3.17.79.7.2  (01-01-2013)
Form 1042S, Income Subject to Withholding Under Chapter 3

  1. Manual Refund Units will receive copies of Form 5205, Information About Your Income Tax Refund and Form 1042S, Income Subject to Withholding Under Chapter 3, Internal Revenue Code in the Certification function on all Forms 1040NR, U.S. Non-Resident Alien Income Tax Return, and Forms 1120F, U.S. Income Tax Return of a Foreign Corporation, on which withholding amounts have been taken from interest paid on tax refunds. Retain Form(s) 1042S and Form(s) 5205 part 3 in a suspense file until time to prepare the IRS Commissioner's Form 1042. For procedures in regard to the 180-Day Rule, see IRM 20.2.4.7.6.

  2. Distribute Forms 1042S as follows:

    1. Maintain Copy A in a suspense file by Taxpayer name.

    2. Forward Copy B to the taxpayer.

    3. Attach Copy C to the case file and complete processing required in IRM 3.17.79.3.1.

  3. Forms 1042S should not be distributed until the refund action is complete. Forms 1042S related to deleted refunds should be destroyed or adjusted as appropriate.

    Note:

    NMF will use EIN ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ for the processing of Form 1042S.

3.17.79.7.3  (01-01-2013)
Preparation of Form 1042 (IRS Commissioner's Form) Ogden Only

  1. The second week ending in January:

    1. Prepare an adding machine tape of all Form 1042S totals in the suspense file.

    2. Prepare a Form 1042. (Marked "ORIGINAL PREPARED BY IRS-MRU" across the top).

    3. Use the Internal Revenue Service as the withholding agent.

    4. Use the OSPC address.

    5. Use ≡ ≡ ≡ ≡ ≡ ≡ ≡ the Employer Identification Number of withholding agent.

    6. Enter total number of Forms 1042S filed, on line 61a and 61b, of Form 1042.

    7. Enter total accumulated in (1)(a) above on lines 62a and 62b of Form 1042.

    8. Enter the tax liability on Lines 63a.

    9. Leave balance of Form 1042 blank.

    10. Return Due Date (RDD) for Form 1042 is March 15 (if weekend or holiday, the next available business day), NO EXCEPTION.

  2. Total in (1)(h), above, must agree with Forms 5205 and the credit on the module as a result of the monthly transfers from the 4610 Account.

  3. Associate Form 1042 with all Forms 1042S (Copy A). Forward to the Receipt and Control Branch for batching and input to Project 810.

  4. Destroy Part 3 of Form 5205.

3.17.79.7.4  (01-01-2013)
Routing Form 1042S To Ogden Center (Cincinnati and Austin)

  1. Cincinnati and Austin Manual Refund functions will Express Mail all Form 1042S' to the Ogden, Accounting,Manual Refund function. Ogden should receive these required documents before January 31.

  2. Form 1042S must be associated with Form 1042 for processing of the Commissioner's Form 1042.

3.17.79.8  (01-01-2013)
Processing Miscellaneous Refunds

  1. When a refund to a taxpayer is required for an amount previously recorded as a deposit in the 2300 User Fee account Tax Exempt Government Entities (TEGE), the amount of the refund is scheduled on the Secure Payment System (SPS) or Form 1166 with Account Symbol 20X1807 . These refunds are now dispersed by Beckley Financial Center (BFC). IRM 3.17.79.6.

3.17.79.8.1  (01-01-2013)
General Fund Receipts Account Refunds

  1. Forward SPS/Form 1166 to RRACS for journalizing. This action will transfer the amount from the General Fund Receipt Account to the Refund Appropriation Account to record the taxpayer's refund.

  2. Upon receipt of the refund confirmation data from the RFC link, the RRACS activity will journalize the transaction.

  3. The Net Tax Refund Report (NTRR) will not reflect this transaction.

3.17.79.8.2  (01-01-2013)
Receipt of Excess Collection Notice

  1. After receipt of Form 3731, Unidentified Remittance Voucher, or Excess Collection Record covering collections applicable to the Area or Territory Director's Office, or approved memorandum for transfers from the Deposit Fund account, the following is required:

    1. Assign a voucher schedule number in the same series number as assigned to SPS/Form 1166 for manual refunds.

    2. Transmit Form 1081 through IPAC/GWA (Government Wide Accounting System) entering the Submission Processing Center (SPC) as the Customer Agency and using the voucher number assigned above.

    3. Enter the proper refund appropriation to be charged 20X0903, 20FY0907 or 20X6879.09 (Deposit Fund) in "Appropriation, Fund, or Receipt Symbol" under the "Customer Agency" column.

    4. Enter the Agency Location Code (ALC), Department, Bureau and mailing address of the agency to be credited under the "Billing Agency" column. The Appropriation or Fund Symbols for the other agency accounts to be credited does not have to be input. All transfers of funds from the Submission Processing Center to other Accounting functions should be charged to Appropriation 20(FY)0913 .

    5. Describe the reason for the transfer and any detail needed by the other agency under "Details of charges or reference " . Any necessary supporting documents required by the Chief Financial Officer (CFO), Accounting functions must be forwarded under separate cover to the CFO.

    6. Forward one copy of Form 1081 for input to RACS team.

  2. Enter IRS Schedule Voucher Number on Form 3731 and return to the Unidentified clerk.

  3. File a copy of the Form 1081 transmission in a permanent file by transmission number in accounting period order for subsequent site audit by the General Accountability Office (GAO).

  4. See 3.17.79.11.6 for instructions for reporting the Form 1081 transmitted on Form 224. Place a copy of the Form 1081 transmission in a report file for forwarding to National Office.

  5. Funds transferred from the field office to the Submission Processing Center via Form 1081 are made to Appropriation 20X0903 . If the SP Center disagrees with the charges, initiate an Form 1081 to charge back the difference to the CFO.

3.17.79.8.3  (01-01-2015)
Refunds or Reimbursement of Photocopy Fees (Form 4506)

  1. A Final Photocopy Fee Refund Listing is prepared by the Photocopy or Return and Income Verification Services (RAIVS) function. This is to reimburse prepaid charges to requestors for copies of previously-filed tax returns. The Service must reimburse requestors for photocopy and tax account information request the advance fees paid to IRS when tax documents cannot be located in IRS files. Final Photocopy Fee Refund Listing with supporting documents Form 4506, Request for Copy of Tax Form or Tax Information, and case files are routed to Accounting Operations for processing per 3.17.79.3 and 3.17.79.5.

  2. No interest is paid on these reimbursements.

  3. All Photocopy Fee refunds are disbursed from Account 20X0903 and reported on each Submission Processing Center Form 224. These amounts will be reclassified to Account 20X5432.2 on the RRACS System.

  4. One copy of Final Photocopy Fee Refund Listing is maintained in a monthly file for use to prepare other required reports.

  5. Returned and undeliverable refund checks are processed as outlined in IRM 3.17.80, Working and Monitoring Category D, Unassessed Erroneous Refund Cases in Accounting Operations.

  6. IRM 21.2.5, Miscellaneous Forms and Processing, provides instructions for the Form 4506 Photocopy function to retain credit documents (e.g., Form 1098) for at least 60 days to research taxpayer inquiries and to reissue Photocopy Fee refunds if they are returned as undeliverable (TC 740).

  7. Accounting performs the necessary quality review, compares to items on the final listing and notifies the RAIVS function of discrepancies or corrections to produce the final listing from the Accounting User Menu Option. Once verified as accurate and correct, Accounting's designated representatives at the Submission Processing Centers access the Photocopy Fee Refund System to print the final listing. Accounting performs the steps required to schedule and certify the refunds.

  8. Certifying Officers receive necessary system, security requirements, the Photocopy Refund User System Manual and necessary technical assistance.

3.17.79.8.4  (01-01-2015)
Refunding From 6800 Account, Excess Collections

  1. Credits which remain unapplied for 12 months or longer are generally transferred to 6800 Account. Sometimes, these credits are subsequently identified for a refund. See the statutory limits discussed in IRM 25.6, Statute of Limitations.

  2. Amounts are refunded from Excess Collections, 6800 Account, on Form 3753, Manual Refund Posting Voucher, as outlined in IRM 3.17.79.3.2. These manual refunds are issued on Form 1166.

3.17.79.8.5  (01-01-2015)
Refunding from 4610 Account, Unapplied Advance Payments (ANMF Accounts)

  1. Amounts representing cash bonds or unapplied advance payments are held in 4610 Account, until deficiency assessments are made and the payment is applied, or part or all of the payment is refunded. The submission of cash bonds or advance payments stops the running of interest on the amount of any deficiency covered by the payment.

  2. No interest is allowed on any part of the payment(s) refunded to the taxpayer, if the payments are prior to October 22, 2004 per Rev. Proc 84–58 and Rev. Proc 2005-78. Credit interest is allowed on deposits submitted after October 22, 2004 per IRC Section 6603(c). A Section 6603(d) payment is identified on the tax account by TC 640 with blocking series 990–999. See IRM 20.2.4.8.1 for additional information.

  3. Amounts in excess of the deficiency assessments are refunded. To refund amounts in excess of the deficiency assessment:

    1. Prepare Form 3753.

    2. No interest is allowed on these overpayments.

    3. Forward case file with supporting documentation to the Manual Refund function. Continue processing as outlined in IRM 3.17.79.3.2 and 79.3.5.

    4. The Manual Refund function prepares, schedules, certifies and transmits the refund schedule via SPS. Forward Schedule to RRACS for further processing.

  4. There may be occasions when the taxpayer responds to the 316C Letter, and the taxpayer requests all or part of the payment be refunded.

    1. The area receiving the response from the taxpayer to the 316C Letter initiates Form 3753.

    2. Forward case file with supporting documentation to the Manual Refund function. Continue processing as outlined in IRM 3.17.79.3.2 and 79.3.5

    3. The Manual Refund function prepares, schedules, certifies and transmits the refund schedule via SPS.

    4. Enter Schedule Number on Form 3244A, Payment Posting Voucher Examination Division. Route copy of Form 3244A to SC Examination. Forward refund schedule to RRACS for further processing.

3.17.79.8.6  (01-01-2014)
Processing Unapplied Remittance Refunds (Form 4878)

  1. When Accounting Operations receive generated Form 4878, Voucher and Schedule of Payments, from IDRS, these represent items identified for application to another government agency or for refund to the taxpayer because the correct application cannot be identified.

  2. Prepare summary Voucher and Schedule of Payments in triplicate. Attach Form 4878 to each SPS/Form 1166 copy. Original copy (first) of Form 4878 must go to the Bureau of Fiscal Services (BFS) Regional Financial Center (RFC).

  3. Compare and reconcile the total with the total shown on the summary SPS/Form 1166.

  4. Assign schedule number to SPS/Form 1166.

  5. The Certifying Officer or designee detaches original and duplicate SPS/Form 1166 with Form 4878 attached, (first and second copy) and sends to the RFC.

  6. See IRM 3.17.63, Redesign Revenue Accounting Control System, for the appropriate RRACS Screen. RRACS will serially number Form 8166 and enter the number on the related SPS/Form 1166, and return these forms for filing.

3.17.79.8.7  (01-01-2013)
Audit or Collection Adjustments; Refunds In Names Other Than the Taxpayer-Form 3460, Transmittal Memo

  1. Form 3460 (Transmittal Memo Accounting Control Document) noted "Manual Refund" with Audit and Collection adjustments of IMF and BMF returns may be received for processing.

  2. "Sensitive" , "Hardship" , Joint Committee, Civil, or Tentative Carryback Allowances are included with cases indicating that a refund check is to be issued in a name other than that of the taxpayer, and a permanent name change is not involved. Joint Committee cases must have the accompanying documents from the Joint Committee attached.

  3. The related returns are not attached.

  4. A completed Form 3753 giving the DLN of the original return, is received for each case. Form 3753 must have specific reasons written in "Remarks" section. If not complete, requests will be rejected see IRM 3.17.79.3.2.1.

  5. Audit adjustment is substantiated by Form 1331B, xerox copies of taxpayers' letters, or Form 5344.

  6. Data Processing (DP) tax adjustments are received with Form 3354, or IDRS Form 5147, IDRS Transaction Record.

  7. If Form 5344 or Form 3354 is not noted Hold Code "1" or "2," return case to the Adjustment function.

3.17.79.8.8  (01-01-2014)
Refunds for Less Than $1.00

  1. Overpayments of less than $1.00 are systemically cleared from the module by the posting of a TC 386. If a taxpayer requests a refund of an overpayment of less than a $1 for IMF accounts, see IRM 21.4.4.2.1 Requests for Refund Less Than $1.00.

  2. Requests for a refund of an overpayment of less than $1.00 for BMF accounts must be issued as a manual refund request, see IRM 21.4.4.2.1 Requests for Refund Less Than $1.00

3.17.79.8.9  (01-01-2013)
U.S. Virgin Islands Resident - Cover Over (AUSPC Only) Excluding Additional Child Tax Credit Coverovers

  1. U.S. citizens and resident aliens who are bona fide residents of the U.S. Virgin Islands (USVI) during the entire taxable year, must file income tax returns with the USVI Bureau of Internal Revenue. They are generally not required to file U.S. returns, except to pay self employment tax (Form 1040 SS), unless they fail to report all of their income, identifying its source and fully pay the correct amount of tax to the USVI. The USVI will send certain income tax returns to IRS with a list and a certification that the individuals are legal residents in cases where cover over to the USVI is necessary because there is U.S. withholding or net collections of income tax.

  2. Accounting receives from IMF International Accounts Management:

    1. Copy of verified list of taxpayers.

    2. Original Memorandum to the Treasury of the Virgin Islands (V.I.).

    3. Form 3809, Miscellaneous Adjustment Vouchers, to process TC 820 to debit each taxpayer's account and transfer the credits due to the Virgin Islands.

    4. DO NOT PROCESS MANUAL REFUNDS DIRECTLY TO VIRGIN ISLANDS GOVERNMENT.

  3. Accounting balances Form 3809 to the Form 3753. Form 3809s are numbered using area FLC (File Location Code) 66, see IRM 21.8.3 for Blocking Series chart and Form 813 is prepared. Refund schedule number is assigned and Form 3753 is input to SPS (formerly ECS) for issuance of a consolidated paper check. The Certifying Officer certifies the request and it is transmitted to BFS (Bureau of Fiscal Services) for payment.

  4. Documents (Form 3809 and Form 3753) are delivered to RRACS Team for preparation of Form 8166, input to RRACS and distribution.

3.17.79.8.9.1  (01-01-2015)
Military Cover Over for U.S. Virgin Islands, Commonwealth of Northern Mariana Islands (CNMI) and American Samoa Residents (IRC 7654)

  1. The Internal Revenue Service must cover over to the respective territories the income taxes collected with respect to bona fide residents of U.S. Virgin Islands, CNMI or American Samoa who join the U.S. Armed Services.

  2. After appropriate research by IMF International Accounts Management, Accounting receives:

    1. Copy of verified listing for the individual Territory.

    2. Cover letter addressed to the territory Bureau of Internal Revenue (BIR) Disclosure Officer for each tax year.

    3. Form 3809, Miscellaneous Adjustment Vouchers, to process TC 820 to debit each taxpayer's account and transfer the credits due to the individual Territory.

    4. One Form 3753, Manual Refund Posting Voucher, to issue consolidated check to the Government of the appropriate Territory.

  3. Accounting balances Form 3809 to the Form 3753. Form 3809 are numbered using area FLC (File Location Code) 66, see Blocking Series chart and Form 813 is prepared. Refund Schedule number is assigned and Form 3753 is input to SPS for issuance of consolidated check to the appropriate Territory. The Certifying Officer certifies the refund and it is transmitted to BFS for payment.

    Payments are made by the following:
    American Samoa -ACH Direct Deposit
    Northern Mariana Islands -Same Day Pay Direct Deposit
    U.S. Virgin Islands -Paper Check
  4. Documents (Form 3809 and Form 3753) are delivered to RACS Team for preparation of Form 8166, input to RRACS and distribution to:
    Savali Velega Jr.
    Treasurer/Director
    Department of Treasury
    American Samoa Government
    Pago Pago, American Samoa 96799

  5. Forward lists and Form 3753 to local Quality Assurance team for review.

3.17.79.8.9.2  (01-01-2015)
Wire Transfer of Funds To American Samoa

  1. Taxpayers may initiate the request for a wire transfer refund with Ogden Submission Processing Center by filing a Form 8302 (Rev. 12-2009), Direct Deposit of Tax Refund of $1 Million or More, other supporting documentation, their return or claim. Refunds for amounts less than $1 million, for any single tax year, must be issued by check.

  2. Form 3753, Manual Refund Posting Voucher, is prepared by the area initiating the refund and forwarded with the complete case file to Accounting Operations for review and preparation of refund schedule and voucher (SPS/Form 1166).

  3. The Manual Refund function will verify the attachments and other backup supporting documentation filed with Form 8302.

  4. Verify the Treasurer/Director's signature appears on the accompanying backup supporting documentation, the bank official's name, address and telephone number, etc. If any of the pertinent information is not provided by the taxpayer, you must issue the refund by check, as provided in IRM 3.17.79.5.3. Prepare correspondence to the Treasurer/Director stating, "the refund will be issued by check rather than by same day pay or wire transfer," when Form 8302 is incomplete or lacks backup supporting documentation.

  5. The requirements for a deposit ticket or check need not be followed in this instance due to the verification of the Samoan government's bank, the ABA number of the bank, and the bank account number of the Department of the Interior. Other supporting documentation may also be included.

  6. If Form 8302 is satisfactory, note in the remarks section of Form 3753, "FEDLINE or same day payment to taxpayer's bank name, ABA number, and taxpayer's account number."

  7. Route the voucher to the Philadelphia RFC at the address below:
    Federal Building - ATTN: FEDLINE
    5000 Wissahickon Ave
    Philadelphia, PA 19144

  8. Once the refund voucher has been forwarded, the case file is returned to the originating organization for further processing. The originating organization is also informed when the Regional Financial Center (RFC) support listing confirms the receipt of the refund after being wired by Philadelphia RFC.

3.17.79.8.10  (01-01-2013)
Refunding From 20x1807 Account, A Miscellaneous Revenue Account

  1. Refunds from the MISC Revenue account includes disbursements for lockbox banks, credit card charge-backs, PFIC (Passive Foreign Investment Company) and Arbitrage rebates (Form 8038T ONLY). Exhibit 3.17.79-5.

  2. TFM Part 6 Chapter 3000 Section 3050-Payments from Account 20X1807 Agencies initiating payments from account 20X1807 must do so via the Secured Payment System. An authorized agency certifying officer must certify these payments.

  3. Maintain a file of paid disbursement vouchers (Form 3753) with supporting documents for payments made from this account. Make records available to internal auditors and auditors conducting on-site audits for GAO.

  4. TFM Part 6 Chapter 3000 Section 3050, requires that the IRS provide notification and supporting documentation of refunds totaling over $100,000 (Per SF224). Send email communication to:

    Treasury and IRS Contacts
    Credit Accounting Branch, FASD AC Management Bureau of Fiscal Services Nilda.Clemente@fms.treas.gov and Scott.Barber@fms.treas.gov
    Fax to: 202-874-7900
    Submission Processing Accounting and Tax Payment Branch Janet.Bertagnolli@irs.gov and Debra.J.Scott@irs.gov

3.17.79.9  (10-18-2013)
Preventing Duplicate Refunds

  1. Treasury Inspector General for Tax Administration (TIGTA) and other management internal control reviews cited a high incidence of duplicate refunds. To improve internal controls and reduce these weaknesses, the Service:

    1. Updated IRM procedures to cross-reference (via IDRS TC 971), the TIN and credit source document file locations and indicated on Form 3753 and Form 5792 in the remarks section where the credit and source documents are filed.

    2. Emphasized in correspondence a reminder to all field executives the importance for initiators of manual refunds to monitor accounts (e.g., IDRS in 'B' Status, TC 840) as well as incorporating similar descriptions to research and monitor requirements in the ADP and IDRS Information, Document 6209 Catalog No. 614620), Section 6.

    3. Emphasized to all employees to not close the control base prematurely before the TC 840 posts. This premature closure may allow a generated refund (TC 846) to be released because the account is not being monitored adequately for subsequent transactions to post, allowing a generated refund after releasing the manual refund. The refund processing system allows a pending generated refund (PN 846) to be intercepted or stopped via IDRS CC NOREF (BMF only).

    4. Added procedures in IRM 21.4.4, Manual Refunds, to update IDRS and to monitor taxpayer accounts, prepare approval documents, input IDRS actions and other commands (e.g., CMODE whether similar account activity is occurring by another employee or in another part of the country). Since these manual refunds are considered high risk and exception-processing, it is imperative that initiators research and monitor accounts to prevent duplicate refunds or erroneous refunds.

  2. To prevent the release of duplicate refunds caused by improper monitoring of accounts and to detect subsequent manual refunds (TC 840), several IDRS changes occurred.

    1. Warning messages on input screens for CC RFUND, "Possible Duplicate RFUND/Request Completed," alerts initiators of the possibility of a duplicate refund. Initiators will not have the option of interrupting CC RFUND prior to end of day runs.

    2. If a duplicate is detected, process it as an erroneous refund per IRM 21.4.5, Erroneous Refunds. At Center discretion, cases may be transferred to the area which initiated the error.

    3. Employees should not close the control base prior to the posting of the TC 840. These inappropriate closing actions may contribute to causing erroneous refunds.

    4. TC 971 AC 664, Manual refund processed by Accounting was created to help mitigate duplicate and erroneous refunds on Form 3753, Manual Refund Posting Voucher. Presence of a TC 971 AC 664 indicates that a Form 3753 Manual Refund is in process.

  3. IRM 21.4.5, Erroneous Refunds, and IRM 3.17.80, Working and Monitoring Category D, Unassessed Erroneous Refund Cases in Accounting Operations describe actions the Internal Revenue Service may take to identify, track and recover erroneous refunds. Only the cases deemed as a Category D (erroneous refunds, which are unassessable refunds) should be forwarded for recovery to Accounting. These are limited to right of offset, voluntary repayment and requests to Compliance to recommend filing civil suit.

  4. Provide feedback to areas causing erroneous refunds to occur. Providing feedback is considered a method of maintaining internal controls. Feedback is also a mechanism in documenting to management officials the areas causing trends in error rates, and requiring them to take corrective actions.

3.17.79.10  (07-18-2014)
Cancelled Refund Checks (Standard Form or SF1098)

  1. During processing, it may be necessary to stop a refund via CC NOREF for BMF only (See IRM 3.14 Notice Review).

    1. The refund is cancelled by the RFC and the cancellation credit for the item is returned via Form 1098 Schedule of Cancelled or Undelivered Checks. The Reason Code 01 indicates the refund was stopped via CC NOREF (BMF only).

    2. The credit will systemically post to the taxpayer module as a TC 841 and set a "P " Freeze on the module).

    3. Cancellation credits are returned to IRS via Form 1098 (Reason for Return Code) and post back to the taxpayer's account as Master File TC 841. See IRM 3.17.79.10.1.1 Standard Form (Form 1098) - Reasons for Return (RC) Codes from Bureau of Fiscal Services (BFS).

3.17.79.10.1  (01-01-2015)
Treasury Checks Returned to the Submission Processing Center and Regional Financial Center

  1. Refund checks are returned to Regional Financial Centers for reasons other than being "undeliverable" . Taxpayers may return tax refund checks directly to the local offices or to Submission Processing Centers and at times may even return them directly to the RFC. Tax refund envelopes have the return address of the issuing RFC.

    1. Master File (MF) and Automated Non-Master File (ANMF) refund checks returned to the Submission Processing Center must be cancelled and be stamped "Not Negotiable" by Refund Inquiry function or Deposit function and forwarded to the RFC for cancellation as outlined in IRM 21.4.3, Refund Inquiries - Returned Refunds/Releases. The RFC prepares Form 1098 Schedule, Form 1098 listing for the MF, ANMF, Photocopy Fee, and IRAF refund cancellations.

    2. The cancelled MF 1098 cancellation credits are returned from RFC's to Enterprise Computing Center (ECC) - Martinsburg, for posting to taxpayer's accounts. The confirmed Form 1098 and related "Form 1098 listing" (includes Treasury Financial Service (TFS) 145/EFT/DD and 1185/Check Claims credits) on cancelled ANMF, Photocopy Fee, and IRAF refunds.

  2. The "Form 1098 listing" provides a summary of each cancellation by type and Reason for Return Code.

3.17.79.10.1.1  (01-01-2013)
Standard Form (Form 1098) - Reasons for Return (RC) Codes from Bureau of Fiscal Services (BFS)

  1. The following types of credits may be included on an "Form 1098 listing" for MF, ANMF, Photocopy Fee and IRAF refund check cancellations.

    1. Available Check Cancellation (ACC) credits for undeliverable refund checks (returned by the U.S. Postal Service); returned checks (from taxpayers or TP representatives); and intercepted refund checks (intercepted at Submission Processing Center request by the Regional Operating Center).

    2. Rejected SUPER/Direct Deposit refunds (i.e., Electronically Filed Returns (ELF)), which are controlled on TFS Form 145 (tape processing).

    3. Unavailable Check Cancellation (UCC) credits returned under Recertification which Check Claims determines a check is still outstanding, and are controlled on TFS Form 1185 (tape format). These credits are returned to ECC as a result of an Unassessable or Check Claim (Form 1184 via IDRS Command Code CHKCL) .

  2. Reason for Return Codes shown on the Form 1098 listing identify the type of the cancellation or credit as follows:

    1. Code 01 Checks intercepted by request (CC NOREF or refund holds). Returned by the Regional Financial Center (RFC), these credits will post as a TC 841 with a unique blocking series of "55555" and set a "P-" Freeze.

    2. Code 02 Checks returned to the RFC by the U.S. Postal Service as undeliverable. These credits will post as TC 740 credit with a "99999" blocking series and sequence number and set an "S-" Freeze.

    3. Codes 03, 08 or 10 (All other codes not listed). Returned checks other than undeliverable will post as TC 841 credit, Code 8 with a "88899" and Code 3 with a "99999" blocking series and sequence number and set a "P-" Freeze.

    4. Code 09 Unavailable Check Cancellation Credit/Recertification credit returned as a result of non-receipt claim (IRS Form 3911, Taxpayer Statement Regarding Refund or input of CC CHKCL/SF1184). This credit is returned after both the RFC and BFS Check Claims Group determines the check is still outstanding. These credits post as a TC 841 with a unique blocking series and sequence of "88888" and do not set a "P-" Freeze.

    5. Code 09 Reclamation credit. Credit returned as result of a non-receipt claim after adjudication by the Check Claims Group reclaims the amount from the financial institution. No Freeze, TC 841 with unique blocking series and sequence of "88000."

    6. Code 09 Outstanding check. Credit returned as the result of a paper check claim (Form 1184). No Freeze, TC 841 with unique blocking series and sequence of "88111" .

    7. Code 11 Taxpayer correspondence attached or cancelled Photo Fee refunds, that would not post back to the Master File. If Photocopy Fee Refund (Form 4506) Send taxpayer correspondence to Photocopy Fee function with supporting cancellation (Form 1098) documents.

    8. Code 40 Limited Payability (LP). Expired check credit. Posts S- Freeze, TC 740 with unique blocking series and sequence "66666."

    9. Electronic Fund Transfer (EFT) 60 Invalid/missing Routing Transit Number (RTN).

    10. EFT 61 Invalid/blank bank account or account type (c) checking or (s) savings.

    11. EFT 62 Direct Deposit Check receiving financial institution non-ACH participant.

    12. EFT 63 EFT payments without financial organization address on Financial Organization Master File (FOMF).

    13. Code 71 Unavailable check cancellation offset. Code returned as a result of an agency claim, only the Treasury Offset Program (TOP) offset amount of the original payment is returned. See IRM 21.4.6, Refund Inquiries - Refund Offset. Transaction Code 841 with unique blocking series and sequence "88888" .

    14. Code 72 Unavailable check cancellation partial payment. As a result of an agency claim, only the net amount of the original payment is returned following the TOP offset (See IRM 21.4.6, Refund Offset). Transaction Code 841 with unique blocking series and sequence "88888" .

  3. Send all other taxpayer correspondence to Refund Inquiry with supporting cancellation documents.

  4. See Exhibit 3.17.79-8, Reason for Cancellation Codes, for further information.

3.17.79.10.1.2  (01-01-2015)
Confirmed Standard Form (Form) 1098 Cancellations from Bureau of Fiscal Services (BFS)

  1. Receive confirmed copy of Form 1098, Schedule of Canceled or Undelivered Checks, from the RFC with listings on MF cancellations. Within 10 workdays of receipt of the Form 1098:

    1. Verify total on Form 1098 with total of Form 1098 listing. If there is a difference, contact the Regional Financial Center and resolve the discrepancy (See IRM 3.17.79.10.7, Incorrect Cancellation Amounts).

    2. Journalize as outlined in IRM 3.17.63, Accounting Control.

    3. Route one copy of the Form 1098 schedule and Form 1098 listing to the Refund Inquiry function.

    4. Route one copy to the Notice Review function and one copy to the Correspondence function. Correspondence function will associate the Form 1098 to any correspondence received from the taxpayer or his representative. The RFC will record the SSNs and EINs on letters before forwarding correspondence to IRS.

  2. Receive confirmed Form 1098 schedule from the Regional Financial Center along with the Form 1098 listing on ANMF, Photocopy Fee, IRAF cancellations. Upon receipt of confirmed cancellation schedules:

    1. Verify total of Form 1098 schedule with totals of amounts shown on Form 1098 listing. If there is a difference, contact the Regional Financial Center and resolve the discrepancies (See IRM 3.17.79.10.7 for procedures).

    2. Control all accounting documents through the Redesign Revenue Accounting Control System (RRACS) (Refer to IRM 3.17.63, Revenue Accounting Control).

    3. Research using the copy of SPS/Form 1166 Voucher and Schedule of Payments and supporting refund documents (Form 3753/Form 5792) showing principal and interest, File Location Code or Universal Location Code, item count and line number on the Net Tax Refund Report. In extremely rare cases, this same research must be accomplished on Form 1081, SF1184 and TFS Form 3813.

    4. Prepare Form 3245, Posting Voucher-Refund Cancellation or Repayment (See Exhibit 3.17.80-11, for blocking series), for each taxpayer indicated on the Form 1098 listing, except for Photocopy Fee refund cancellations. For all Code 2 check cancellations, input TC 740 in the amount of the undelivered refund. For all Codes 3, 8 or 10 check cancellations, input TC 841 in the amount of the returned refund.

    5. Prepare Form 813.

    6. Forward Form 1098, Form 813, Form 3245, abstract documents and NTRR information for input to RRACS.

      Note:

      Form 1664X or listing that has been processed will be forwarded to the Taxpayer Relations function.

    7. File copy of Form 1098 in a Suspense File for monthly preparation of Net Tax Refund Report (NTRR) for balancing purposes.

    8. File original Form 1098 in the closed file for balancing and for the monthly preparation of the NTRR.

    9. Forward one copy of the Form 1098 Schedule, Form 1098 listing and refund document (e.g., Form 3753, Manual Refund Posting Voucher or Photo Fee listing) for Photocopy Fee refunds to the Photocopy Fee/RAIVS function.

  3. Should Form 1098 Listing not arrive in the Accounting area within a reasonable amount of time, search within the Center (e.g., Refund Inquiry, Notice Review, Photocopy Fee/RAVIS Units or other Accounting Operations work areas) before seeking a replacement.

    1. If Form 1098 Listing does not arrive within two (2) weeks of downloading schedules from OPAC/GOALS/IPAC, contact ECC (through User Support or the Help Desk) to ensure the cancellations were posted to Master File. If unable to locate, issue Enterprise Help Desk or Information Technology Asset Management System (ITAMS) Ticket.

    2. Address requests from Chief, Accounting Control/Services Operations for additional copies of Form 1098 Schedules/Listings to: Chief, Processing Validation Section, Enterprise Computing Center (ECC) - Martinsburg, OS:CIO:I:EO:MC:O:W:PV, Stop 535, 250 Murall Drive, Kearneysville, West Virginia 25430.

    3. Provide the OPAC/GOALS/IPAC confirmation dates, item count, dollar amounts and refund schedule numbers in correspondence sent to ECC.

    4. Managers or Seniors should provide guidance when Form 1098 Listings do not arrive in your function timely. Contact ECC only after exhausting your search in other areas of the Center as they may have been mis-routed within your own Center.

    5. The guide used by the Extraction function or the Media Transport IRM may assist you in locating routing designations for documents.

    6. Center Accounting Operations must carry unresolved Form 1098 refund cancellations journal actions on the RACR into the following month if the Form 1098 Listing has not arrived by month-end.

3.17.79.10.1.3  (01-01-2015)
Tax Forms Standardization (TFS) 3813, Schedule of Uncollectible Checks

  1. The Regional Financial Centers complete TFS Form 3813 to document corrections to payment references. All TFS Form 3813 contain sufficient cross-reference information to identify items corrected and the reason for the correction.

  2. FMS Form 3813 reverse previously cancelled items; debits the agency; is followed by another Form 1098 to correct the cancellation. With some variations at specific Regional Financial Centers, both actions occur on a weekly basis.

  3. The RFC will enter the following information on the Form 3813.

    • BUREAU SCHEDULE: Number - This is the number and date of the original cancellation. This can be used by the agency to locate the cancellation that is being reversed.

    • BUREAU SCHEDULE: Date - This is the date and number of the deposit ticket that was used to transmit cancellations, including the ones that have rejected.

    • O/D, NO., DATE AND AMOUNT - Date of Form 5515, Deposit Voucher.

    • CHECK DESCRIPTION, REMITTER, AND REASON FOR RETURN - This column provides the reason for the reversal and also the full description of the payment.

    • AMOUNT OF CHECK - Amount of the payment being reversed.

    • SYMBOL OF FUND TO BE REDUCED - Agency appropriation fund that is being reduced.

3.17.79.10.2  (01-01-2015)
Processing Intercepted Refund Checks (Reason For Return Code 01)

  1. Master File checks (TC 846) are cancelled and controlled under Form 1098, Schedule of Cancelled Checks, and forwarded to ECC on tape for posting TC 841's to the taxpayer account. These checks are listed on Form 1098, and forwarded to the appropriate Submission Processing Center Agency Location Code (ALC) to be used in posting credits to taxpayer accounts.

  2. ANMF, IRAF and Form 4506 Photocopy Fee, checks which are pulled or intercepted are cancelled and controlled under Form 1098. The Form 1098 schedule and listing are forwarded to the ALC. Accounting Operations forwards a copy of the Form 1098 schedule and Form 1098 listing reflecting Photocopy Fee (4506) cancellations to the Photocopy Fee/RAIVS function. IRM 21.2.5, Miscellaneous Forms and Processing, was updated requiring Units to maintain these credit documents for research and subsequent re-issuance of the Photocopy Fee Refund if correspondence is received from the taxpayer. Prepare Form 3245 for all other cancellations with the following information:

    • Posting Voucher - enter two-digit FILE LOCATION Code from ENMOD or CFOL

    • SSN/TIN - enter SSN or EIN with an "N" if NMF or "P" if IRAF

    • Return Period - enter TAX PERIOD (YYYYMM)

    • MFT - enter applicable MFT

    • Name - taxpayer's first and last NAME and underline the NAME Control

    • Remarks - enter comment to include the following: Reverse TC 846 or TC 840 (MMYYYY), intercepted - Code (X) SF 1098 number (XXX-X-XXX)

    • Cancellation Column

    • Schedule date - enter the date of the TC 846 or TC 840 (MMDDYYYY)

    • TC - enter TC 841

    • Amt of Check - enter the AMOUNT shown on the SF 1098 listing

    • Check Number - enter refund check number

    • Schedule Number - enter refund schedule number

    • Repayment Column

    • Date Received - Blank

    • TC - Blank

    • Amt of Check - Blank

    • TC - 772

    • Interest - enter the amount of credit interest paid as the TC 772 amount (NMF ONLY)

    • Date - enter current date (MMDDYYYY)

    • Employee ID/Badge - enter preparers SEID and initials

    • This voucher relates to - Check the "Other" box and enter SF1098

    • Document Locator Number - stamp with DLN as follows: Digit 1-2 Universal Location Code, Digit 3 Tax Class, Digit 4-5 Doc Code 45, Digit 6-8 Current Julian Date, Digit 9-11 Blocking Series 555, Digit 12-13 Serial Number, beginning with 00, Digit 14 Current list year

    Note:

    The DLN Blocking Series for these cancellation credits (Digits 9 through 13) will always be "55555" .

3.17.79.10.3  (01-01-2015)
Returned Check Cancellations - Manually Prepared IMF and BMF (RRCs 02 and 03)

  1. Code 02 Within 10 workdays of receipt of the Form 1098 schedule and Form 1098 listing, prepare Form 3245, Posting Voucher-Refund Cancellation or Repayment, for all Code 02 check cancellations to input a TC 740 in the amount of the undelivered refund.

  2. Stamp "Refund Check Cancelled" on applicable Refund Schedules (1166/1167) and supporting refund document (Form 3753, Form 5792, and/or Refund Voucher List).

  3. List on Form 813, Document Register, all Form 3245 having the same Office and Tax Class codes. Hold these documents until all work on Form 1098 is complete, then route the original copy of the Form 813 with Form 3245 to Batching and Numbering.

  4. Forward Form 1098 schedule, Form 1098 listings, and all supporting refund documents for undeliverable refunds (Code 02) to Refund Inquiry.

  5. Forward second copy of Form 813 for input to RRACS for journal action.

  6. Code 03 Within 10 workdays of receipt of Form 1098 Schedule and Form 1098 listing, prepare Form 3245 for all Code 03 check cancellations to input TC 841 in the amount of the returned check.

  7. On Form 813, list all Forms 3245(See Exibit 3.17.79-7), Blocking Series Chart for Document Code 45, Form 1098 and TRACS Processing) having the same Office Code (formerly known as DO)/Business Operating Division (BOD) and Tax Class codes. Hold these documents until all work on the Form 1098 is complete, then route the original Form 813 with Form 3245 to Batching and Numbering.

  8. Forward for input to RRACS for journal action.

3.17.79.10.4  (01-01-2015)
Processing Returned Automated Non-Master File (ANMF) Checks

  1. Within 10 workdays of receipt of Form 1098, associate refund documents (e.g., Form 3753, Form 5792, Form 1331B, and/or Refund Voucher List), and accompanying forms (e.g., SPS or Form 1166) with the Form 1098 Schedule and Form 1098 listing.

  2. Stamp "Refund Check Cancelled" on applicable Refund Schedules (SPS or Form 1166), and supporting documents (Form 3753, Form 5792, Form 1331B, and/or Refund Voucher List).

  3. Cancelled Refund Schedules are photocopied (3 copies). Taxpayer correspondence and any other attachments are also photocopied.

    1. Forward 1 copy of Form 1098 Schedule, Form 1098 Listing and cancelled refund documents with the original Form 1098 Schedule and Form 1098 listing to the RACS function for journaling. The copy is returned with a second journal number to be retained for future reference.

    2. 1 copy of Form 1098 Schedule, Listing and cancelled refund documents is kept in Suspense File. Destroy this copy upon receipt of journaled copy.

    3. 1 copy of the Form 1098 Schedule, listing and cancelled refund documents is routed to the Photocopy Fee function if refunds on the Form 1098 are photocopy fee refunds (Form 4506).

    4. 1 copy of the Form 1098 Schedule, Form 1098 Listing and cancelled refund documents is routed to Refund Inquiry if refunds are undeliverable refunds (Code 2).

    5. Some refunds require "special handling" by Refund Inquiry (Form 3913, Acknowledgment of Returned Refund Check). These refund cancellations require an additional copy to be forwarded to the requesting Tax Examiner in the Refund Inquiry function.

  4. Processing Form 1331B.

    1. Prepare Form 4338 (Information or Certified Transcript Request). Submit completed form to ANMF function to request a photocopy of the ANMF Transcript.

    2. Upon receipt of the copy of the ANMF Transcript, prepare Form 3245. Use TC 841 for Codes 03 and TC 740 for Code 02. Verify information on Form 3245 with ANMF Transcript and Form 1331B. Photocopy (3 copies) of the ANMF Transcript and Form 3245. Associate with photocopies of the Form 1098. Associate Form 3245 and ANMF Transcript with original Form 1098 Schedule, listing and cancelled refund check documents.

  5. Prepare a Document Transmittal to route the original Form 3245, ANMF Transcript, original Form 1098 Schedule, Form 1098 Listing and cancelled refund documentation to RRACS for journaling.

  6. Forward the Form 3245 with a copy of the Form 1098 to ANMF Accounting.

  7. The journaled Form 1098 Listing is forwarded to the Refund Inquiry function for processing as outlined in IRM 21.4.0, Refund Inquiries.

3.17.79.10.5  (01-01-2015)
Returned Individual Retirement Account File (IRAF) Checks

  1. Changes to the MFT were revised in 2005 to allow IRAF overpayments to be computer generated. In the meantime, there could be instances when Centers receive these returned items issued prior to 2005.

  2. Prepare Form 3245 for each cancellation credit reflecting returned IRAF checks, within 10 workdays of receipt of Form 1098 Schedule and Form 1098 Listing.

  3. The transaction code for Form 3245 depends on the Reason for Return Code displayed on the Form 1098 Listing. Some Codes 02 cancellations require input of TC 841.

  4. Prepare Form 813 for all Form 3245 containing the same Office Code (formerly known as DO/Business Operating Division (BOD) and transaction codes. Route original Form 813 and corresponding Form 3245 to Batching and Numbering for processing.

  5. Forward original and copy of Form 1098 Listing and duplicate copy of the Form 813 to RRACS for journaling.

  6. All Form 1098 Listings should be noted by the RACS Journaling function as "deposited" and routed for filing.

3.17.79.10.6  (01-01-2015)
Correcting Erroneously Posted Transaction Code (TC) 841

  1. Due to systemic problems (e.g., cancelled for wrong check number or with the incorrect check symbol number, etc.), the Bureau of Fiscal Services, Regional Financial Center (RFC) may advise the Internal Revenue Service to correct a payment cancelled in error by the RFC . These items may require reversal through the input of a TC 843. A Treasury TFS Form 3813, Schedule of Uncollectible Checks, will be received from the RFC to correct this information explaining the nature of the correction.

  2. When TFS Form 3813 is received, research 4970 Account for a matching credit.

    If the credit Then
    Is there
    1. Write "No Second Journal Needed" on the Form 3813 by the taxpayer name/TIN.

    2. Photocopy Form 3813 to retain for possible future reference.

    3. Prepare Document Transmittal and attach to TFS 3813 and forward to RACS for journal action

    Is not there
    1. Research IDRS or Form 1098 listings in Suspense File for a matching TC 841.

    2. If no data on IDRS, request IMFOL, research CFOL, or complete MFTRA for each taxpayer listed.

    3. Determine which MFT and tax period the TC 843 should be processed against.

  3. To correct erroneously posted TC 841:

    1. Prepare Form 3245 for each correction. When inputting the TC 843, use the date and amount of the related TC 841.

    2. Enter in remarks section of the Form 3245 the explanation for the correction as indicated on the FMS Form 3813.

    3. Create an open control on the IDRS tax module and monitor until the TC 843 posts.

    4. When the TC 843 is pending, input a TC 470, using CC REQ77.

    5. Monitor the tax module using TXMODN (notice information) at the beginning of each cycle. The posting of the TC 843 will put the taxpayer into debit balance. If necessary, contact the Notice Review function to intercept the first balance due notice.

    6. Establish a case folder and monitor the tax module until BFS/RFC returns the good credit. Input additional TC 470(s), if the original will expire prior to the posting of the credit. When the credit has posted, close the IDRS control base and destroy the case file.

  4. When received from the RFC, credit items are journaled into the 4970 Account.

  5. The TFS Form 3813 should provide necessary information about the reason for the TFS 3813 reversal and when the Form 1098 should be forwarded to the Submission Processing Center Agency Location Code (ALC) by the Regional Financial Center (RFC).

  6. Input additional TC 470(s) if the original notice holding code will expire prior to the posting of the credit.

    1. Monitor case files and tax modules of pending items each month or until the RFC returns credits (TC 841) or the corrected Form 1098, Schedule of Uncollectible Checks arrives.

    2. If the Form 1098 is not received by the next accounting period, follow-up with the RFC. Request that the Form 1098 be forwarded. Document pending items in the case file for any further action. Update IDRS as necessary to reflect any follow-up actions.

    3. Continue monthly monitoring of case files. If credits are not received by the next accounting period, initiate necessary further correspondence with the issuing Regional Financial Center. Document circumstances and place in case file.

    4. Addresses for the respective Regional Financial Center appear in Exhibit 3.17.79-10.

    5. When credits post, close the IDRS control base and destroy the case file. Input the following:

    ACTON
    C#CRFRFMS,C

3.17.79.10.7  (01-01-2015)
Incorrect Cancellation Amounts

  1. If a TC 841 or TC 740 amount shown on the Form 1098 tape or listing is input to a taxpayer module and the cancellation amount does not match the amount of the corresponding TC 840/846, the credit will not post to Master File except as noted below. The Refund Inquiry or Unpostables function will advise Accounting Operations when these differences in amounts or money mismatches (MM) occur.

    1. There are two types of offset: Tax Offset and Treasury Offset Program (TOP) Offset (See IRM 21.4.6, Refund Inquiries - Refund Offset, for further information).

    2. A TC 841/740 can be less than the original refund amount if a Treasury Offset (TOP) TC 898 has occurred.

    3. BFS should reverse all offsets with a cancelled refund amount and return the entire amount of the original TC 840/846 to IRS. However, BFS will deduct from the original refund any portion of the offset previously reversed by IRS (a TC 766 with Offset Trace Number, OTN) and/or previously refunded by the agency (a TC 899, type 2 and 3, less TC 899, type 4) with same OTN's as the TC 898(s) offset.

    4. Unpostable Code (UPC) 138 criteria will incorporate the TOP TC 740/841 conditions, for different money amounts. See TOP procedures in IRM 21.4.6.5.24, Returned Refund Check.

    5. Resolution of UPC 138 are no different than previously, except when TC 898 is present. See further references in the TOP IRM 21.4.6, Refund Inquiries - Refund Offset.

    6. If TC 841 on module is due to Identity Theft (IDT), see procedures in IRM 3.17.243.3.5.1 Resolving Cases with TC 841 Posted.

  2. Accounting Operations will initiate correspondence to the issuing Regional Financial Center (RFC) to advise them that a cancellation credit has been received for an amount different from the original check amount. The correspondence should request that the RFC immediately issue a TFS Form 3813, Schedule of Uncollectible Checks, to reverse the incorrect amount and to issue a Form 1098 for the correct amount.

  3. Include the following information in the correspondence:

    1. Taxpayer's name

    2. SSN/EIN

    3. Cancellation credit amount as shown on the Form 1098 listing

    4. Correct amount as shown on the taxpayer module

    5. Check symbol

    6. Check number

    7. Form 1098 schedule number

    8. Form 1098 date

  4. To determine the correct amount when a TOP offset has occurred:

    1. Look for TC 898.

    2. Subtract any TC 899 type 2 or 3 and TC 76X from TC 840/846 amounts.

    3. Add any TC 899 type 4.

    4. All of these transactions must have the same Offset Trace Number (OTN) as the accompanying TC 898.

    5. Disregard all signs when adding or subtracting the transaction amounts from the original refund.

    6. See IRM 21.4.6.5.24, Returned Refund Checks.

  5. Route the correspondence to the issuing Regional Financial Center (See Exhibit 3.17.79-10 for list of RFC mailing addresses). Format the address of such correspondence to the Payments and Claims Branch.

  6. Establish a control base on IDRS as follows:
    ACTON
    C#,MMLTRTORFC,M,MISC
    *,*

  7. Monitor the case until the TFS Form 3813 is received from the Regional Financial Center. When received, prepare Form 3245 to input TC 843 or TC 742. Update the control base to show that TFS Form 3813 has been received as follows:
    ACTON
    C#,3813RECD,M,MISC
    *,*

  8. If the correct cancellation credit is received but the FMS Form 3813 is not (or vice versa), immediately contact the appropriate RFC by telephone and request the missing document.

  9. Credits will be journaled to the 4970 Account during research and until FMS Form 3813 is received. After FMS Form 3813 (debit) is received from the RFC, it will cancel the incorrect amount of the Form 1098 held in the 4970 Account.

  10. Monitor for receipt of the reissued/corrected Form 1098. Follow-up with the RFC may be required.

  11. When the correct Form 1098 and/or TC 841 is received and posted, close the control base as follows:
    ACTON
    C#,TC841PSTED,C

3.17.79.11  (01-01-2014)
Undeliverable Refund Check (Transaction Code (TC) 740, S- Freeze) Cancellations

  1. Refund checks are returned to the Regional Financial Center (RFC) by the U.S. Postal Service when they cannot be delivered. U. S. Postal Service returns the check to the Bureau of Fiscal Services (BFS) Regional Financial Center (RFC) to be cancelled and the credit returned to the agency who initiated the disbursement. The majority of tax refunds are issued by the San Francisco Regional Financial Center (SFRFC).

    1. The RFC cancels the undelivered checks and returns credits to IRS Enterprise Computing Center (ECC) - Martinsburg via Form 1098 cancellation credits.

    2. These credits post to Master File as TC 740; set an S- Freeze, and generate a notice to the taxpayer (CP 31through CP 231) that the tax refund was returned as undeliverable.

  2. At times, the RFC may return credits with the incorrect Reason for Return Code which is interpreted incorrectly when posting to the Master File and may or may not Freeze the account accordingly. If this occurs in error, posting corrections to taxpayer accounts must be handled manually. These procedures refer to other sections of the IRM to process these credits.

3.17.79.11.1  (01-01-2013)
Undeliverable Enterprise Computing Center - (ECC-MTB) for Code 02/TC 846) Individual Master File (IMF)/Business Master File (BMF) Refund Check Cancellations

  1. The Regional Financial Centers receive, cancel, and code undeliverable IMF/BMF ECC computer generated (TC 846) refund checks as outlined in IRM 3.17.79.10.1, Treasury Checks Returned to the Submission Processing Center and Regional Financial Center.

  2. The Regional Financial Centers transmit to ECC all computer generated (TC 846) undeliverable refund checks (Reason for Return Code 02) for posting TC 740 with S- Freeze, in the amount of the check to the taxpayer's account (both IMF and BMF) and sorted by Agency Location Code (ALC). This is accomplished through the Form 1098/145/1185 cancellation runs at ECC -MTB. ECC - MTB posts the TC 740 (S Freeze) and forwards taxpayer account data to the Centers for printing Undelivered Refund Check Notices: CP31 for IMF taxpayers; CP231 for BMF taxpayers.

  3. Submission Processing Centers process to RRACS and reclassify as required in IRM 3.17.63, Redesign Revenue Accounting Control System.

3.17.79.11.2  (01-01-2013)
Undeliverable Integrated Data Retrieval System (IDRS) Generated Refunds

  1. For IMF/BMF checks, follow the processing procedures contained in the applicable sections of this handbook. Consider that, in some instances, e.g., hardship, decedent cases, it may be necessary to perform CC RFUND procedures.

  2. For BMF checks issued, the Regional Financial Center (ROC) produces Form 1098 and a related Form 1098 Listing for the Agency Location Code Submission Processing Center for posting TC 740 to the BMF at MCC.

  3. The Regional Financial Centers produce, Form 1098 and a consolidated listing of all ANMF, Photocopy Fee Refund and IRAF checks; separate file totals for various program areas:

    1. ANMF and photocopy fee refund check cancellations.

    2. IRAF check cancellations.

    3. See IRM 3.17.79.10.4, Processing Returned Automated Non-Master File (ANMF) Checks and IRM 3.17.79.10.5, Returned IRAF Checks for instructions for preparing Form 3245 to post credits to taxpayer accounts.

    4. Forward one copy of the Form 1098 schedule and Form 1098 Listing for Photocopy Fee refunds to the Photocopy Fee function.

    5. Further instructions for processing Photocopy Fee undeliverable refunds are located in IRMs 21.4.4.6.2, PhotoCopy Fee Refunds and IRM 3.5.20.5.1.12.3, Undelivered Refunds and LMTD Pay Cancellation .

3.17.79.11.3  (08-12-2014)
Unpostable Cases Received From Rejects/Refund Inquiry (Unpostable Code (UPC) 138 RC 0 or UPC 290 RC 5)

  1. Input Correction Operation, Unpostable or Reject functions may not be able to correct some unposted Transaction codes (TC) 841, 740 or 843. If this occurs the unposted transaction will be closed with a closing code 1 or 8 to the Accounting function for resolution.

  2. There are several conditions that may cause the unpostable or reject condition.. One of the following may have occurred:

    • Account merged

    • The refund was moved

    • Invalid date

    • Returned refund posted to taxpayer module as a TC 720

      Note:

      If a TC 720 is posted on the taxpayer module, the TC 720 will need to be moved off the account in order for the TC 841, TC 740 or TC 843 to post. If the TC 720 is on a taxpayer module that contains a TC 971 action code (AC) 134 this is an External Lead case, in the Return Integrity Operation/Integrity & Verification Operations (RICS/IVO). If the unpostable TC 841 is from BFS and Not from an IDT case (DLN blocking series 94X) the TC 720 can be reversed. Contact RICS/IVO and request a reversal of the TC 720, due to the unpostable TC 841, TC 740 or TC 843. See IRM 3.17.64.18External Leads Processing (ELP) Cincinnati and Fresno Accounting Only.

    • Returned refund posted to taxpayer module as a TC 841

      Note:

      If the posted TC 841 on the taxpayer module is due to an IDT case (DLN blocking series 94X) see IRM 3.17.243.3.5.1.1Resolving Cases with TC 841 Posted.

  3. Thorough account research must be performed to resolve these cases. See If and Then chart below.

    If Then And
    Reprocessing the original Use the same DLN Batch documents and forward to Data Processing
    Creating a new document Prepare a Form 4028 to 0–2 the original DLN off Batch documents and forward to Data Processing
    Creating a Dummy Prepare case file Batch documents and forward to Data Processing
    NOTE:
    • Use the same DLN when possible

    • Form 4028, Form 813 and case document are taken to Data Control to process the 4028

    • Batch documents for Data Conversion

    • Use the same blocking series and Julian date of the unpostable

    • If Julian date previously used, go to previous date

    • Forms that we reprocess are Form 3245, Form 3244 or Form 12857

    These are just a few examples on how we process the documents.

    TC 841 with a DLN of XXXXX-XXX-55555-X
    1. a NOREF was input

    2. a TC 898 on the account

    3. or the date is incorrect

    4. If a TC 899 on the account, the TC 841 should be posted

    5. If noTC 841 posted, process as TC 670 with a TC 570 to hold the credit

    6. complete Form 4028

    TC 841 with a DLN of XXXXX-XXX-66666-X
    1. Limited Payability

    2. refund not cashed within 1 year

    3. possibly because the refund has been moved via Form 12857

    4. research IDRS, Form 12857

    5. complete Form 4028

    TC 841 or TC 740 with a DLN of XXXXX-XXX-77777-X
    1. returned by BFS

    2. see work processes above when DLN XXXXX-X XX-66666–X

    TC 841 with a DLN of XXXXX-XXX-99999-X
    1. either a returned refund from the taxpayer or an undelivered refund

    2. see work processes above when DLN XXXXX-X XX-66666–X

    TC 740 and TC 843 are worked as above

    Note:

    How the unpostable is resolved depends on the reason it unposted. Every effort should be made to resolve Unpostable conditions within 4 weeks of receipt.

3.17.79.12  (01-01-2014)
Treasury's Receivable Accounting and Collection System (known as TRACS)

  1. When Treasury checks are not presented for payment within one year from the date of issue, or when Bureau of Fiscal Services (BFS) Check Claims activities require that expired credits or debit items be returned to agencies, BFS cancels outstanding checks and returns credits to agencies or sends debit items to the agency's ALC usually via the Form 1081. TRACS is Treasury's automated system to account for, bill and collect for the Bureau of Fiscal Services, Check Claims and disbursement process.

3.17.79.12.1  (01-01-2013)
Background - Limited Payability Legislation, Public Law 100–86

  1. Limited Payability legislation, Public Law 100-86, requires that negotiation of government checks occur within one (1) year from check issuance. If checks are not negotiated, BFS must cancel outstanding checks and return credits to the issuing agency.

  2. TRACS is an automated system implemented by BFS to handle all accounting, billing and collection activities associated with the refund check claims process.

  3. There are three types of transactions issued from BFS:

    1. Funds disbursed via GOALS/OPAC/IPAC;

    2. Funds transferred via Form 1081 (to correct an erroneous GOALS transmission); and

    3. BFS Check Claims (Form 1184/CHCKL) transactions where the conversion of data from the previous systems to the new TRACS necessitates using a paper Form 1081.

  4. The system automates summary accounting transactions and supporting detail records previously received via Form 1081, Voucher and Schedule of Withdrawals and Credits, and Form 1081 listings.

    1. Transactions (both debits and credits) are transmitted to agencies via the GOALS/IPAC and are journaled upon receipt into the RRACS 4970 Account, Unapplied Refund Reversal Account.

    2. TRACS provides GOALS summary transactions to Enterprise Computing Center (ECC) for each Agency Location Code (ALC) for posting credits and debits to the Master File.

    3. Prior to 1993, all Form 1081 transactions were processed manually via Form 3245, Refund Cancellation Posting Voucher, from the Form 1081 listings; sent to DIS for input; and were posted to Master File.

    4. TRACS Miscellaneous listings and systemic processing difficulties experienced by either IRS or BFS still require manual processing via the Form 3245.

    5. Although TRACS was intended to eliminate the paper Form 1081, there continue to be a low volume of paper Forms 1081 issued by BFS, Accounts Branch. In many cases, these paper Forms 1081 result from systemic difficulties in returning credits/debits via tape to RECC, or in making corrections to the GOALS transmissions. Form 6653, Undisbursed Appropriations, are reported monthly to the Agency Location Codes (RACS area in Accounting Operations) from BFS, Accounts Branch. As described in IRM 3.17.80.5.8, CC CHKCL DO NOT Issue Settlement Check to Taxpayer, these monthly reports do not contain all credit/debit monthly transactions issued either systemically via GOALS or via a paper Form 1081.

3.17.79.12.1.1  (01-01-2015)
TRACS Detail Tapes, Types Of Government On-line Accounting System (GOALS) Transmission Credits or Debits

  1. TRACS detail tapes follow GOALS transmissions. These details are sent to Enterprise (formerly Martinsburg) Computing Center (ECC) for direct Master File posting to taxpayer accounts. Enterprise Computing Center (ECC) - Martinsburg, transmits data to Submission Processing Centers for printing detail listings of IMF, BMF and Miscellaneous transactions. IMF and BMF transactions post directly to taxpayer accounts. Miscellaneous listings (Non-Master File, IRAF, Photocopy Fee Refunds, etc.) require manual posting actions. Form 3858, Payments Over Cancellation (POC) claims packages, are mailed to the Submission Processing Center Agency Location Code (ordinarily RACS Accounting Operations area) address appearing on the Form 3858.

    1. Limited Payability Cancellation (LPC) Credits provided on a monthly basis generate TC 740 with block and serial number "66666" and set an "S-" Freeze and generate Master File Transcripts LPCANCEL. These transcripts can be destroyed when received per "Note:" in IRM 21.4.2.4.7.2.

    2. Reclamation (REC) Credits provided on a monthly basis generate TC 841 with block and serial "88000" and are the result of a Form 3911 non-receipt claim resulting in the recovery of funds through the banking system on forged checks. In cases where BFS cannot recover funds, no credit will be returned to IRS, even though they authorize settlement with the taxpayer. Procedures for handling this situation are included here.

    3. Unavailable Check Cancellation (UCC) Credits provided on a daily basis, when they occur, generate TC 841 with block and serial "88111" and set a P-Freeze. These transactions are credits returned on outstanding checks as a result of a non-receipt claim submitted via paper Form 1184.

    4. Payments over Cancellation (POC) Debits provided on a daily basis, when they occur, post to Master File and generate TC 843 with block and serial "55111 " . Accounting employees must monitor cases upon receipt of listings and/or Form 3858 claims packages to ensure no notices are issued to taxpayers by input of TC 470 hold codes. IMF and BMF Master File transcripts "PMTOVERCAN" , generate for the tax module only to which the transaction posts to reverse the accompanying TC 841. Form 3858, Claims Document, FMS Form 1133, Claim Against the United States for the Proceeds of a Government Check, and a photocopy of the check (front and back) are forwarded from BFS Accounts Branch to the respective Agency Location Code (ALC) address. The ALC address appears on the Form 3858 (See 3.17.80.2, Processing Payments over Cancellation (POC)).

  2. ECC sends control file 793-12 detail records of all type transactions weekly (cycle) to Submission Processing Centers. SP Centers produce three (3) copies of these listings and forward to Accounting Operations area for distribution and posting actions.

  3. Maintain a log of all incoming GOALS transmissions and TRACS listings for balancing. Include:

    1. Received dates;

    2. Document Reference Numbers (Schedule Numbers);

    3. Type of Transaction;

    4. Dollar amount;

    5. Number of items or cycle;

    6. Date completed and forwarded to RACS for final journal action.

  4. For control purposes, TRACS listings should be date stamped when received.

  5. If TRACS listings are not received by Accounting within 2 cycles from the GOALS billing date or upon receipt of RACR, at Submission Processing Center discretion, contact the Accounting TRACS Coordinator, Production Support or Planning and Analysis (formerly Management Support). This timeframe should be sufficient for BFS, Accounts Branch in Hyattsville, MD to ship TRACS detail tapes to ECC, for ECC to process to Master File, transmit via CA-Dispatch and for Submission Processing Centers to print the listings.

    Note:

    See Exhibit 3.17.79-4 for list of BFS Contacts.

    1. Accounting closely monitors receipt of TRACS listings after receiving GOALS transmissions. CA-Dispatch (Job 793-12) is transmitted from ECC each cycle. This data is retained for 30 days from the received date by computer rooms. Immediate follow-up ensures the file is still in retention by either ECC or the SP Center computer room and can be reprinted, if necessary.

    2. Accounting employees must be familiar with internal SP Center routing and distribution of computer room print jobs.

    3. If listings are not received: Contact your Computer Room, usually Production Support or the Help Desk. Provide the Job Number (79312), IPAC or GOALS billing date, type of cancellation (POC, REC, UCC or LPC), and cycle. Reel numbers from ECC enable computer room personnel to research file receipt and production records or research with ECC by cycle.

    4. Computer rooms can reprint files, if necessary.

    5. ECC can re-transmit router run files provided the request is received within retention period.

    6. If the router run file cannot be located, Production Support will contact ECC for guidance.

  6. If TRACS detail tapes cannot be located, Contact BFS Accounts Branch, (202) 874-7920, for TRACS detail tape reel number and shipping information. Provide the following:

    1. Schedule/Document Reference Number;

    2. IPAC/GOALS Billing/Confirmation Date;

    3. Dollar Amount of IPAC/GOALS;

    4. Type of Cancellation (POC, REC, UCC, LPC)

  7. BFS Accounts Branch will research their records and provide the BFS file transmission information for further research by ECC.

  8. Provide the BFS reel number to your Center' contact point, usually Production Support, who will give the information to ECC. ECC will determine whether the data has been received, the cycle it was processed and transmitted and whether the data is still retained by ECC. Centers can request that the data be retransmitted.

  9. If tracing is unsuccessful or both Submission Processing Center and ECC data retention periods have expired, a written request to BFS to recreate the data is required as described in IRM 3.17.79.11.2 Processing Reclamation Credits (REC). This action should be only the last resort.

  10. TRACS data received by ECC from Hyattsville, MD, should contain "Z60 xxxxxx" Schedule/OPAC/GOALS billing numbers.

    1. Recreated data requested by Submission Processing Centers to BFS Accounts Branch for previous schedule numbers will contain the same billing numbers as transmitted via IPAC/GOALS.

    2. To prevent duplicate posting situations, schedule numbers with sequence Z601 xxxxx received by ECC will not be processed by ECC until the Accounting TRACS Coordinator in the respective Submission Processing Center verifies that the data should be processed.

    3. BFS Accounts Branch will hand write an "R" on the TRACS tape label for recreated data.

    4. BFS has sent some TRACS tapes and paper Form 1081 documents and listings for the identical schedule. Corrected IPAC/GOALS items cannot be corrected systematically. These paper Form's 1081 schedule numbers are preceded with "B" , followed by 700xxxxx (B700xxxxx).

    5. Some items were incorrectly entered into the TRACS database causing duplicate TRACS tapes with a paper Form 1081.

    6. If Submission Processing Centers receive cancellations transmitted both by TRACS dispatch and a paper Form 1081 (B700xxxx schedule numbers), contact the National Office TRACS Coordinator. BFS has requested that we advise their Accounts Branch on (202) 874-7920 if this duplicate situation occurs in the future.

  11. Money amount discrepancies between IPAC/GOALS/TRACS transmissions and listings and Form 3858 check copy packages should be communicated to BFS Accounts Branch (202) 874-7920. Requests for correction will be made by writing to BFS Accounts Branch as described in IRM 3.17.79.11.2.

  12. If the discrepancy exists between Processing Validation Section (PVS) and SP Center journal actions, Accounting Operations may wish to correspond with ECC. The memorandum should be addressed to:

    Chief, Processing Validation Section
    OS:CIO:EO:EC:OS:W:PV1
    Enterprise Computing Center
    Mail Stop 1230
    250 Murall Drive
    Kearneysville, WV 25430

  13. Provide the TRACS schedule number, the type of cancellation, the money amount and the IPAC/GOALS confirmation date. This provides ECC with sufficient information to research for the cycle the file was transmitted.

3.17.79.12.2  (01-01-2015)
Processing Reclamation Credits (REC)

  1. When a refund check has been cashed and forgery is involved, Check Claims Group will adjudicate the claim. Once the adjudication process is completed and the funds are recovered from the financial institution, credit is forwarded to IRS' Budget Clearing Account. Monies recovered, as the result of the adjudication process, are called reclamation credits.

  2. When a set of TRACS reclamation credit listings (IMF, BMF and Miscellaneous) is received, record information and verify that:

    1. The schedule number and total money amount of the three listings matches the IPAC transmission.

    2. The Submission Processing Center Agency Location Code (ALC) is correct.

    3. All taxpayer information is provided.

  3. Immediately contact BFS Accounts Branch by phone at (202) 874-7920 and inform them if:

    1. Taxpayer identifying (Payee ID) information is missing or incorrect (SSN, EIN, or name).

    2. Amount of the GOALS/IPAC transmission does not equal the total amount of the TRACS listings.

    3. Detail tapes and listings do not follow GOALS/IPAC transmission in a timely manner, within the next month's accounting period.

    4. To trace detail records, Schedule Number (Document Reference No.), and money amount from GOALS/OPAC transmission is provided to BFS. BFS will research and provide the transmission date information, item count and other information for tracking the transmission further with Enterprise Computing Center (ECC) - Martinsburg.

    5. Reel numbers (transmission id) enable research in retention areas.

    6. If tracing is unsuccessful, a written memorandum request from the Manager, Accounting Operations to the Financial Management Service for recreated data is required as follows:
      Financial Management Service
      ATTN: Manager, Accounts Branch
      Room 700-E
      3700 East-West Highway
      Hyattsville, MD 30782

    7. The memorandum should state: IRS TRACS tape replacements are needed for the (Site), Submission Processing Center, ALC 2009XXXX. ECC did not receive the tapes. A replacement tape or the hard copy (paper 1081), must be sent to process the IPAC Bills, and include the information as follows:

    1. IPAC Bill Number

    2. Date

    3. Type

    4. Count

    5. Item $Amount

    6. 3858 Needed (Yes/No)

  4. BFS will:

    1. Provide the missing data.

    2. Reverse the charge and, if appropriate, issue a corrected Form 1081.

    3. Take the necessary actions to correct any differences when the amount shown on the TRACS listing and the GOALS/IPAC transmission differ; or

    4. Take other appropriate action.

    Note:

    Corrections to GOALS transmission or TRACS listings will be done via paper Form 1081. Such corrections cannot be transmitted via GOALS yet.

  5. Occasionally, an amount shown on the TRACS listing may differ from the TC 840/846 amount shown on the taxpayer's account. When this occurs, immediately contact BFS Accounts Branch in writing to inform them of the discrepancy. Attach a copy of the print from the GOALS transmission, the TRACS listing and a photocopy of the refund check (or any other documentation available showing the correct check amount) and forward to the address shown above.

    1. Upon completion of BFS' review, corrective action is taken to initiate an Form 1081 for the difference.

    2. If no response is received from BFS within 6 weeks, follow-up in writing.

    3. If follow-up procedures outlined above in IRM 3.17.79.11.1, Background - Limited Payability Legislation, Public Law 100-86 and in IRM 21.4.4 Refund Inquiries, are unsuccessful and questions or problems concerning TRACS cannot be resolved between the Submission Processing and BFS, contact the National Office for assistance.

  6. All processing for TRACS listings must be completed within 10 work days from the received date. The TRACS listing from ECC, provides an individual breakdown by taxpayer.

    1. Verify that the sum of the totals on the IMF, BMF and Miscellaneous listings match the total cancellations on the corresponding TRACS listing, and that the total matches the GOALS/IPAC amount.

    2. If a discrepancy is found, compare the items on the cancellation listing to the items on the GOALS/IPAC bill to identify the source.

    3. When identified, refer to 3.17.79.11.1.1(12).

    4. Only the IMF and BMF portions of the cancellation listing need to be journaled through RRACS (Debit 4970 Account and Credit Master File) using a Document Transmittal.

  7. Prepare appropriate Document Transmittal (Debit 4970 Account and Credit Master File). Attach a copy of the TRACS listing, a photocopy of the GOALS/IPAC transmission and route to the Redesign Revenue Accounting Control System (RRACS) function for journal action.

  8. Hold all other documents until the RACS function returns the Document Transmittal with the journal number, then:

    1. Route a copy of the TRACS listing to the Refund Inquiry function.

    2. Maintain a copy of the TRACS listing in Accounting.

3.17.79.12.3  (01-01-2015)
Processing Unavailable Check Cancellation Credits (UCC)

  1. When a tax refund non-receipt claim is submitted by a taxpayer and the claim is forwarded to BFS via paper Form 1184, Non-Receipt Claim, Check Claims determines the refund check is outstanding (never been cashed), and a UCC credit is forwarded to IRS's Budget Clearing Account via GOALS.

  2. When a UCC TRACS listing is received, record information and verify that:

    1. The schedule number and total money amount matches the GOALS/IPAC transmission.

    2. The Agency Location Code (ALC) is correct.

    3. All taxpayer information is provided.

  3. Immediately contact BFS Accounts Branch by phone at (202) 874-7920 and inform them of any discrepancies as described in IRM 3.17.79.11.2Processing Reclamation Credits (REC).

  4. All processing for TRACS listings must be completed within 10 work days from the received date. The TRACS listing, produced from a magnetic tape received by ECC, provides an individual breakdown by taxpayer.

    1. Verify that the sum of the totals on the IMF, BMF and Miscellaneous listings match the total cancellations on the corresponding TRACS listing, and that the total matches the GOALS amount.

    2. If a discrepancy is found, compare the items on the cancellation listing to the items on the GOALS bill to identify the source.

    3. When identified, refer to 3.17.79.11.1.1(12).

    4. Only the IMF and BMF portions of the cancellation listing need to be journaled through RRACS (Debit 4970 Account and Credit Master File) using a Document Transmittal.

  5. Prepare appropriate Document Transmittal (to Debit 4970 Account and Credit Master File). Attach a copy of the TRACS listing, a photocopy of the GOALS/IPAC transmission and route to the Redesign Revenue Accounting Control System (RRACS) function for journal action.

  6. Hold all other documents until the RACS function returns the Document Transmittal with the journal number, then:

    1. Route a copy of the TRACS listing to the Refund Inquiry function.

    2. Maintain a copy of the TRACS listing in Accounting.

3.17.79.12.4  (01-01-2015)
Processing Limited Payability Cancellations (LPC)

  1. Under the provisions of the Competitive Equality Banking Act of 1987 (Limited Payability or LP), U.S. Treasury checks must be negotiated (cashed) within 1 year of the check issue date or before October 1, 1990. After expiration of the 1 year period, any checks outstanding (not cashed) will be canceled by Bureau of Fiscal Services (BFS). More detailed instructions about Limited Payability are located in IRM 21.4.4 Refund Inquiries.

    1. For checks issued October 1, 1989 and subsequent, LPC cancellations will take place once monthly. Outstanding checks will be canceled in the Check Processing and Reconciliation (CP&R) System 14 months after the month of issuance. BFS will return credits for these checks to IRS 15 months after the month of issuance.

    2. Credits will be returned via GOALS/IPAC and journaled into the 4970 Account upon receipt. Supporting detail information will be supplied from BFS Financial Information, Accounts Branch in Hyattsville, Maryland, and transmitted directly to ECC. This processing is part of the Treasury Receivable Accounting and Collection System (TRACS).

    3. Limited Payability Cancellation (LPC) Credits provided on a monthly basis will generate TC 740 with block and serial number "66666" . IMF and BMF generated credits between ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ will be immediately released. Those less than ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ will set an "S-" Freeze.

    4. Each LP cancellation tape will produce an IMF tape with detail listing, a BMF tape with detail listing and a Miscellaneous (NMF, Photocopy Fee, etc.) listing of items that cannot be posted to the Master File. It is possible for an ALC address to receive up to three listings for Limited Payability Cancellations.

  2. LP cancellation listings are processed within 10 working days of receipt as follows:

    1. Verify that the sum of the totals on the IMF, BMF and Miscellaneous listings match the total for LP cancellations on the corresponding TRACS listing, and that the total matches the GOALS amount.

    2. If a discrepancy is found, compare the items on the LP cancellation listing to the items on the GOALS bill to identify the source.

    3. When identified, refer to 3.17.79.11.1, Background - Limited Payability Legislation, Public Law 100-86.

    4. Only the IMF and BMF portions of the LP cancellation listing need to be journaled through RRACS (Debit 4970 Account and Credit Master File) using a Document Transmittal (Follow instructions in IRM 3.17.79.11.4.1(4) (d) and (e)).

3.17.79.12.4.1  (01-01-2015)
Miscellaneous Treasury Receivable, Accounting, and Collection System (TRACS) Listing

  1. The Miscellaneous listing is processed manually.

  2. Most entries on the Miscellaneous listing are for Photocopy Fee Refunds. The check issuance date will determine whether the Refund Voucher and Schedule of Payments Number, ending with "PC" , indicating a Photocopy Fee Refund, is still in files. Performing this research will prevent duplicate refunds. At Center option and if documentation is available:

    1. Pull the Secure Payment System (SPS) print or Form 1166, Voucher and Schedule of Payments, from the Manual Refund file for each Photocopy Fee entry on the listing.

    2. Stamp cancellation on the Form 1166 OCR, and at the side of each corresponding entry attached to the Form 1166.

    3. Note on the Miscellaneous listing "6310" for each item.

    4. Follow instructions in (d) and (e), below, to journal through RRACS (Debit 4970 Account and Credit 6310 Account) using a Document Transmittal.

  3. Other entries on the Miscellaneous listing will be IMF, BMF, ANMF, IRAF or General Ledger credits.

    1. At Center option for maintaining and researching the use of the items credited from the 6565 Account, pull the SPS print or Form 1166 OCR, Voucher and Schedule of Payments, with accompanying refund document forms (Form 5792, Form 3753, Refund Voucher Listing, etc.).

    2. Stamp cancellation on the SPS print or Form 1166 and on the accompanying refund document.

    3. Photocopy each schedule and document "Canceled" and attach to the Miscellaneous listing maintained in Accounting. Refile original documents.

    4. Research as necessary, IDRS, MFTRA, INOLE, ANMF, etc.

    5. Control on IDRS and include a history item showing the TRACS Schedule Number, as follows:
      ACTON
      C#,LPLISTING,M,MISC
      *,(TRACS Received Date)
      ACTON
      H,ZXXXXXXXX
      ACTON
      C#,LP/740,C

    6. After research is completed, close the control base.

    7. Photocopy and attach documents to the Miscellaneous listing maintained in Accounting. Verify amounts for balancing.

    8. Note the MFT and Tax Period or General Ledger Account on the LP listing for each credit, and whether a Form 3245 was prepared.

    9. Journal through RRACS (Debit 4970 Account and Credit IMF, BMF, ANMF, or IRAF), whichever account applies, using a Document Transmittal.

  4. Some entries on the Miscellaneous listing may be from a General Ledger Account, such as 6800, 4620, 9999, etc.

    1. Pull the SPS Print or Form 1166, from the Manual Refund File, with accompanying Refund Voucher List.

    2. Stamp "Cancellation" on the Form 1166, and on the Refund Voucher List.

    3. Photocopy each document canceled and attach it to the Miscellaneous listing maintained in Accounting. Refile original documents.

    4. Notate the General Ledger Account 6800 for each credit on the LP Listing.

    5. Journal through RRACS (e.g., Debit 4970 Account and Credit 6800 Account) using a Document Transmittal. Follow instructions in (d) and (e), below. Because credits are over 1 year old, all entries from the General Ledger Accounts are journaled to 6800 Account only.

  5. Prepare Document Transmittal. Attach a copy of the IMF, BMF and Miscellaneous listings and the second copy of any Form 813 to the Document Transmittal and route to the RACS function for journal action.

  6. Hold all other documents until the RACS function returns the Document Transmittal with the journal number. Then:

    1. Route any original Form 813 and Form 3245 to Batching and Numbering for processing.

    2. Route a copy of all listings to Refund Inquiry.

    3. Route a copy of any listings containing Photocopy Fee Refund cancellations to the Photocopy Fee function.

    4. Maintain a copy of all LP listings with any back-up attached in Accounting Operations.

3.17.79.12.5  (01-01-2013)
Maintaining Account 6565 and Monthly Balancing Routine

  1. Checks expired under the provisions of Limited Payability, either issued prior to October 1, 1989, returned by taxpayers or cashed due to forgery, are worked through Account 6565 originating in the Refund Inquiry area to maintain internal controls.

  2. Research and preparation of Form 3809, Miscellaneous Adjustment Voucher, for 6565 Account cases is performed in the Refund Inquiry function. See related instructions in IRM 21.4.2.4.11, Check Cashed/Limited Payability (Possible Forgery) and IRM 21.4.2.4.14 Account 6565 Processing for Refund Inquiry Function.

  3. Refund Inquiry forwards the entire case file to Accounting, or a photocopy of the case file, along with Form 3809 for processing. The following must be included with the case file:

    1. A MFTRA or TFTRA transcript (or IDRS print) of the refund tax module.

    2. A photocopy of the expired check, and/or information supporting a statement that the check was returned to the RFC.

    3. Any taxpayer correspondence.

    4. Form 3859, Claims Disposition Notice (CDN) or evidence that a non-receipt claim was initiated and the current status of the check.

  4. Accounting will verify that:

    1. All information for the case is attached.

    2. Form 3809 is attached (See Exhibit 3.17.79-8, Blocking Series Chart for Document Code 45, Form 1098 and TRACS Processing).

    3. Use of Account 6565 category code is recorded on Form 3809.

    4. A cover sheet is attached to the case (if appropriate) and,

    5. The Accounting Control/Services Chief signed the cover sheet, as appropriate.

    6. See paragraph (5), Check List, below, for Posting TC 841/740.

  5. Maintain a log of all reviewed cases, including but not limited to:

    1. The Taxpayer Identification Number.

    2. The Dollar Amount.

    3. The MFT and Tax Period involved.

    4. General reason why the taxpayer is requesting a new refund check.

    5. Take precautions that duplicate cases are not processed. Refund checks issued October 1, 1989 or after (excluding forgeries) are not processed through the 6565 Account. Outstanding refund checks, issued October 1, 1989, or later, that are over 1 year old, are canceled via Limited Payability (TRACS).

    6. Maintain money amounts of the case files with Form 3809 for balancing the 6565 Account.

    7. Number Form 3809 as instructed in Exhibit 3.17.79-8, using Document Code 48 and Blocking Series 899.

    8. Prepare Form 813, Document Register, listing all Form 3809 having the same MFT.

    9. Prepare Document Transmittal (Debit 6565 Account and Credit Master File). Attach second copy of Form 813 and Part 2-Debit copy, of Form 3809 requesting that journal number be stamped on each Form 3809.

    10. Route to RACS function for journal action.

    11. Hold all other documents until the RACS function returns the Document Transmittal and Part 2-Debit Copy of Form 3809 with the journal number.

    12. Route original Form 813 and Part 1-Credit Copy of Form 3809 to Batching and Numbering for processing.

    13. Attach Part 2-Debit Copy of Form 3809 to each corresponding case file and maintain case files in Accounting.

    14. The 6565 Account is balanced monthly. Balancing actions and other review activities are required as with other general ledger accounts. Current month inventory should be filed separately until balancing is complete; then it is appropriate to maintain the account separately by month or merge it into a general "closed" file for the Fiscal Year.

  6. Check List for posting TC 841/740. The Refund Inquiry function will take the following steps to post TC 841 or TC 740 to the taxpayer's account when the appropriate credit is not posted through normal MF processing (LP TRACS). The Refund Inquiry function researches and prepares Form 3809.

    1. This information is necessary for Accounting to accurately verify that each case is complete. Refund Inquiry will annotate the 6565 Account category of the debit in the upper left corner of Form 3809.

    2. For Categories 2, 3 and 4, a cover sheet must be attached at the front of the case file showing all appropriate attempts to locate the credit were not successful and appropriate managerial level supports the release through 6565 Account.

    3. Category 3 cases require the Accounting Operations Chief's signature.

  7. Category 1: Limited Payability credits (no credit due from BFS). Most 6565 Account cases fit into this category.

  8. Category 2: BFS states the credit has been returned to IRS. After a thorough search and follow-up with BFS, IRS is unable to find any record of the credit. This credit may be sent through the RFC or directly from Hyattsville, as the result of a check claim. See IRM 3.17.63 Redesign Revenue Accounting Control System. Credit is applied from Account 6565 to the taxpayer's account using Form 3809.

    1. BFS, Regional Operating Center: Form 1098 Refund Stops or Intercepts, undeliverables, returned checks (Available Check Cancellations). Regional Financial Center (RFC) will show Reason for Cancellation Code (RCC) (Contact telephone numbers are in Exhibit 3.17.79-10).

    2. BFS, : Form 1081 Reclamation credits, Status 32 credits for paper-filed Form 1184 claims. Contact the person whose name appears on the Form 3859 or Form 1081.

  9. Category 3: BFS authorizes settlement via 3859 and seeks reclamation timely, but no credit is returned to IRS within 1 year. After appropriate contacts with BFS, credit the taxpayer's account. Credit will be applied from Account 6565 to the taxpayer's account using Form 3809. The Accounting Operations Chief's signature is required on the check sheet. If credit is subsequently received from Hyattsville, credit the 6565 Account for the amount previously debited to satisfy the taxpayer.

  10. Category 4: BFS authorizes settlement and reclaims from the bank, however, the bank recovers only partial credit. BFS, therefore, is able to return only partial credit to IRS. Since a partial credit cannot post, the taxpayer's account remains in debit balance for the entire amount. After appropriate follow-up with BFS, use Form 3809 to debit Account 6565 and credit Account 4970 for the difference. Prepare Form 3245 to post the entire refund amount from Account 4970 to the taxpayer's account.

  11. No Category Number: The amount of credit from BFS is less than the refund amount (understated), and the amount is under ≡ ≡ ≡ ≡ . Follow-up with BFS indicates no correction will be made. Post reversal of the entire refund to the taxpayer's account. Annotate the Form 3245 with the amount from Account 6540 (Debit Account 6540) and the amount from Account 4970.

  12. No Category Number: BFS returned the credit, but the amount of credit is more than the refund amount (overstated), and the discrepancy is under ≡ ≡ ≡ . Follow-up with BFS indicates no correction will be made. Annotate the Form 3245 with the amount to post the credit to the taxpayer's account. The excess amount will be applied to Account 6540.

3.17.79.12.6  (01-01-2013)
Processing Credits, Standard Form (Form) 1081

  1. At times, systemic difficulties prevent the return of credits via TRACS and a refund check is outstanding or corrections to GOALS/IPAC transmissions are necessary. In these situations, credit is returned to IRS Budget Clearing Account via Form 1081, or Form 1081 EDP Voucher and Schedule of Withdrawals and Credits. The Form 1081 is accompanied by an Form 1081 listing which provides individual items by taxpayer identification numbers. Refund Inquiry, if appropriate, initiates a recertified check to the taxpayer in cases where the refund is not automatically issued from Master File (TC 846).

  2. Accounting logs incoming Form's 1081. Record data in the log:

    1. Form 1081 number;

    2. Dollar ($) amount;

    3. Type of charge (debit or credit);

    4. Item count; and

    5. Received date.

  3. Verify that:

    1. The Agency Location Code (ALC) is accurate and the charge is intended for that Submission Processing Center;

    2. All taxpayer information is provided; and

    3. All items are for tax refunds.

  4. If discrepancies are identified, contact BFS' Accounts Branch at (202) 874-7920. Explain the discrepancy:

    1. ALC is incorrect;

    2. Account cannot be identified;

    3. Charge belongs to another ALC;

    4. Charges are not for tax refunds; or

    5. Taxpayer identifying information (SSN/EIN/Name) is missing or incorrect.

  5. BFS will either:

    1. Provide the missing data;

    2. Reverse the charge via Form 1081 and, if appropriate, issue a corrected Form 1081; or

    3. Take other appropriate action.

  6. In situations as described in IRM 3.17.79.11.6 (3) or (4), above, do not prepare an Form 1081 to reverse charges back to BFS without first obtaining prior approval from BFS.

  7. Occasionally, an amount shown on the Form 1081 may differ from the TC 840/846 amount shown on the taxpayer's account.

    1. Treasury Offset Program (TOP) refund offsets will occur if taxpayers have an agency debt. See IRM 21.4.6 Refund Inquiries - Refund Offset.

    2. This offset is indicated by TC 898 on the taxpayer's account.

    3. If no TC 898 and money amounts still differ, immediately contact BFS Accounts Branch by phone and in writing.

    4. Attach a copy of the Form 1081 listing and any other documentation available showing the correct refund amount.

  8. Forward to:

    Bureau of Fiscal Services
    Manager, Accounts Branch
    Room 700
    3700 East-West Highway
    Hyattsville, Maryland 20782

    1. When review is completed by BFS, action will be taken to initiate an Form 1081 for the difference.

    2. If no response is received from BFS within 6 weeks, follow-up in writing. See IRM 3.17.79.11.2 Processing Reclamation Credits (REC), for example of written request to BFS, Accounts Branch.

    3. If follow-up procedures outlined above and in IRM 21.4.4 Refund Inquiries, are unsuccessful, and questions or problems concerning changes on the Form 1081 cannot be resolved between the SP Center and BFS, contact the National Office Project 744 analyst. Previous correspondence and documentation between the Center and BFS may be requested by National Office.

3.17.79.12.6.1  (01-01-2015)
Corrected or Paper Standard Form Form 1081

  1. BFS, Accounts Branch, explains that receipt of paper Form 1081 is considered TRACS exception-processing; the items cannot be transferred from Check Processing and Reconciliation (CP&R) to TRACS automatically. Also, paper Form 1081 result when BFS issues data or item corrections to previous GOALS transmissions. Corrections cannot currently be transmitted via GOALS.

  2. Corrected Form 1081 can be identified by Schedule numbers "B700xxxxxx." These items will also contain sufficient information to describe the initial schedule transmission being reversed or corrected.

  3. BFS, Accounts Branch, attempts to maintain accurate end-of-month records of paper Form 1081 issued, and provides each ALC with a listing of paper Form 1081 for the prior accounting period. If centers do not receive this document to verify transmittals by the 15th of the month following the accounting period, contact the BFS, Accounts Branch.

  4. Within 10 workdays of receipt of the Form 1081, using the Form 1081 listing as the basis, prepare a Form 3245, Posting Voucher-Refund Cancellation or Repayment (See Exhibit 3.17.79-8 for Blocking Series), for each taxpayer, to input a TC 841 to the tax module for the amount of the credit.

    1. When the TC 841 posts to the tax module, a "P" Freeze generates. The P Freeze indicates that a refund check has been canceled and redeposited.

    2. Review the return before releasing the P- Freeze and reissuing the refund. See IRM 21.4., Refund Inquiries, for resolution of the P- Freeze.

  5. Not all information required for preparing the Form 3245 can be found on the Form 1081. Research IDRS/IMFOL for the ULC/Office code and Schedule date. IMFOL should be used instead of requesting MFTRA whenever possible.

  6. Control on IDRS. Include a history item showing the Form 1081 number. Include a history item showing the money amount if more than one TC 846 has posted to the account.

    ACTON ACTON
    C#, 1081/841,M,MISC H#, (Form 1081 Number)
    *, (Form 1081 Received Date)  
    ACTON
    H#, ($ Amount)
  7. After research is complete and Form 3245 is prepared, close the IDRS control base.

    ACTON
    C#, 3245PREP, C
  8. Verify amounts of Form 3245 with the Form 1081 for balancing. Maintain a log of all Form 3245 by DLN and date.

  9. Photocopy (1 copy) of all Form 3245 and the Form 1081 listing. Make 2 photocopies of the Form 1081 schedule.

  10. Prepare Form 813, Document Register, listing all Form 3245 having the same Office and tax class codes. Verify amounts for balancing.

  11. Prepare Document Transmittal (Credit Master File). Attach the original Form 1081 schedule, the second copy of Form 813, and a tape verifying the amounts to the Document Transmittal and route to the Revenue Accounting Control System (RACS) function for journal action.

  12. Hold all other documents until the RACS function returns the Document Transmittal with the recorded journal number, then:

    1. Route the original Form 813 and Form 3245 to Batching and Numbering.

    2. Route a photocopy of the Form 1081 schedule and listing to the Refund Inquiry function. Make a note on the copy that a TC 841 will be posted to the tax module to reverse the TC 840/846.

    3. Maintain a photocopy of the Form 1081 schedule, the original Form 1081 listing, and a photocopy of all Form 3245 in Accounting.

Exhibit 3.17.79-1 
Glossary of Terms, Abbreviations and Commonly Used Forms in Accounting

Terms/Abbreviations Definition
23C Date Assessment Date; Notice Date
1510 Account Other Receivables Formerly Used For Erroneous Refunds
1530 Account Erroneous Refund Court Cases
1540 Account Erroneous Refund Non-Court Cases
1535 Account Questionable Refund Program/Return Preparer Program Restitution
4910 Account Erroneous Refund Pending Write-Off Approval
4970 Account Unapplied Refund Reversal
4620 Account Unidentified Remittance
6565 Account Limited Payability
6800 Account Excess Collection
6920 Account Erroneous Refund Approved Write-Off
A
ACC Available Check Cancellation
ACH Automated Clearing House - type of EFT System
ACI Assistant Commissioner International
ACTON IDRS Case Control and History Request
ALC Agency Location Code
AMS Account Management Services
ANMF Automated Non-Master File
ASED Assessment Statute Expiration Date
ATAO Application for Tax Assistance Order
ARFC Austin Regional Finance Center
B
BBTS Batch Block Tracking System
BMF Business Master File
BMFOL Business Master File On-Line Research
BOB Block Out of Balance
BPD Bureau of Public Debt
C
CADE Customer Account Data Engine
CAF Centralized Authorization File
CCG Check Claims Group
CDN Claim Disposition Notice (BFS)
CFINK Centralized Authorization File Inquiry
CFO Chief Financial Officer
CFOL Corporation Files On-Line System
CHKCL Non-Receipt Claim Check Claim Request
COMPA Compute Interest or Estimated Tax Penalty Request
CP&R Check Processing and Reconciliation System (BFS)
CSCO Compliance Services Collection Operations (formerly Service Center Collection Branch (SCCB))
CSED Collection Statute Expiration Date
D
DCC Detroit Computing Center
DDES Direct Data Entry System
DIS Distributed Input System
DLN Document Locator Number
DMF Debtor Master File
DOJ Department of Justice
DPC Designated Payment Code
DQ Deleted in Quality Review
E
ECC Enterprise Computing Center
EITC Earned Income Tax Credit
EIN Employer Identification Number
EFT Electronic Funds Transfer
EFTPS Electronic Federal Tax Payment System
ELF Electronic Filing System
EONS Electronic Online-Output Network System
EQ Embedded Quality
ERRF Erroneous Refund
ERS Error Resolution System
ERSED Erroneous Refund Statute Expiration Date
ESTAB Document Request
F
FEDLINE Transmits funds through FEDWIRE
FEDWIRE A type of EFT service using Federal Reserve Communication System (FRCS)
FIDO Filing District Code
FLC File Location Code
FMS Financial Management Service
FPD Financial Processing Division (formerly Adjudication Division)
FRCS Federal Reserve Communication System
FTD Federal Tax Deposit
G
GAO Government Accountability Office
GMF Generalized Mainline Framework
GOALS Government On-Line Accounting Link System (BFS)
GSA General Services Administration
GUF Generalized Unpostable Framework
GWA Government Wide Accounting
H
HAL Holds Automated Listing (BFS)
I
ICS/ACS Integrated Collection System/ Automated Collection System
IDRS Integrated Data Retrieval System
IGR IDRS Generated Refund
IMF Individual Master File
IMFOL Individual Master File On Line research
IMF IRAF Individual Master File Accounts (MFT 29)
INOLE National Account Profile Entity Research
INTST Interest / FTP penalty Accrual Computation Research
IPAC Intra-Governmental Payment and Collection System
IRAF Individual Retirement Account File (effective January 2005, IRAF merged into IMF).
ISRP Integrated Submission and Remittance Processing
L
LDTR Large Dollar Trend Report
LETER Letter Request
LP Limited Payability
LPC Limited Payability Cancellation
M
MCR Master Control Record
MFT Master File Tax (Codes)
MFTRA Master File Transcript Request
MFTRA (G) Master File Transcript Request (Debtor Master File)
MFTRA (U) Master File Transcript Request (Numident-SSN)
MFTRA (X) Master File Transcript Request (Taxpayer Literal Copy)
N
NAMEE (BMF) Employer Identification Number (EIN) Research
NAMES (IMF) Social Security Number (SSN) Research
NLUN Nullified Unpostable Category Code
NMF Non-Master File
NOREF (BMF only) Refund Intercept Request
NTRR Net Tax Refund Report
O
OBL Outstanding Balance List
OBR Offset Bypass Refund
OIC Offer in Compromise
OPAC On-Line Payment and Collection System
P
PACER Payment and Claims Enhanced Reconciliation
POA Power of Attorney
POC Payment Over Cancellation
PRINT Printer Replacement to Integrate New Tools
R
RAC Refund Anticipation Check - A RAC is the non-loan product that many commercial tax preparers and their financial institution partners offer in addition to RAL(s). RAC(s), the financial institution opens a temporary bank account into which the IRS direct deposits the refund check. In lieu of issuing a RAL to the taxpayer, the financial institution waits until the IRS direct deposits the taxpayer(s) refund into the temporary bank account. The financial institution , via the preparer, then issues the taxpayer a paper check from the tax preparer.
RAL Refund Anticipation Loan - A RAL is money borrowed by a taxpayer from a financial institution based on the taxpayer(s) anticipated income tax refund. The loan is made pursuant to a written agreement between the taxpayer and the financial institution.
RRACS Redesign Revenue Accounting Control System
RCTF Recertification Category Code
RDD Return Due Date
REC Reclamation Credits
REFAP(R) Refund Approval IDRS Request
REINF IDRS Refund Information File Research
REQ54/ADJ54 IDRS DP Adjustment Request
REQ77/FRM77 Miscellaneous Transaction Adjustment Request
RFC Regional Financial Center
RFCK Photocopy Request of Refund Check
RFIF Refund Information File
RFIQ Refund Inquiry IDRS Category Code
RFUND(R) IDRS Generated Refund Request
RSED Refund Statute Expiration Date
RSN Refund Schedule Number
RTN Routing and Transit Number
RTVUE Return Transaction On-Line Inquiry
S
SACS Security and Communications System
SCCF Service Center Control File
SCRIPS Service Center Recognition Input System
SFR Substitute for Return
SFRFC San Francisco Regional Finance Center
SITLP State Income Tax Levy Program
SPC Submission Processing Center
SPS Secure Payment System (BFS)
SSN Social Security Number
STAUP Status Notice Update Request
SUMRY Tax Account Research
T
TAS Taxpayer Advocate Service
TAU Telephone Answering Unit, BFS
TC Transaction Code
TDA Taxpayer Delinquent Account
TEP Tape Edit Processor
TERUP Transaction Deletion Request
TIA Tax Information Authorization
TIN Taxpayer Identification Number (or SSN/EIN)
TOP Treasury Offset Program
TPRQ Taxpayer Request Category Code
TRACS Treasury Receivable Accounting and Collection System
TRDBV Tax Return Data Base, Retrieves Original Tax Return Information
TRIS Telephone Routing Interactive System
TRPRT Request Prints of Original Filed Returns
TXMOD Tax Module Research
U
UCC Unavailable Check Cancellation
UPCAS Unpostable Case Request
UPCAS(Z) Unpostable Case Request
UPTIN Unpostable Case Request
URF Unidentified Remittance File, Account 4620
URINQ Unidentified Remittance Inquiry
X
XSF Excess Collection File, Account 6800
FORM TITLE-DESCRIPTION
TFS 145 Part of Form 1098 Listing (Direct Deposit)
Form 210 Signature for Certifying Officer
Form 224 Statement of Transactions
Form 514B Tax Transfer Schedule
Form 813 Document Register
Form 843 Claim for Refund and Request for Abatement
Form 911 Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order)
Form 1040N U.S. Non-resident Alien Income Tax Return
Form 1042S Income Subject to Withholding Under Chapter 3
TFS 1044 Form from Treasury (Pre-Recertification)
Form 1081 Voucher and Schedule of Withdrawals and Credits
Form 1096 Annual Summary and Transmittal of U.S. Information Returns
Form 1098 Schedule of Canceled or Undelivered Checks
Form 1099C Cancellation of Debt
Form 1099G Certain Government Payments (currently 1099C)
Form 1099INT Interest Income
Form 1120F U.S. Income Tax Return of Foreign Corporation
Form 1120S U.S. Income Tax Return for an S Corporation
Form 1128 Application to Adopt, Change, or Retain a Tax Year
TFS 1133 Claim against the United States for the Proceeds of a Government Check
TFS 1133R Release of Claim Against the U.S. for Proceeds of a Government Check
Form 1166OCR Voucher and Schedule of Payments
Form 1167OCR Continuation Sheet
Form 1184 Unavailable Check Cancellation
TFS 1185 Schedule of Unavailable Check Cancellation Credits
Form 1310 Statement of Claimant to Refund Due Deceased Taxpayer
Form 1331B Notice of Adjustment
Form 1664X Photocopy of Checks (obsolete form, but occasionally used)
PD 1782 Application for Redemption at Par of U.S. Treasury Bonds Eligible for Payments of Federal Estate Tax
Form 2159 Payroll Deduction Agreement
Form 2188 Voucher and Schedule of Overpayment and Overassessments
Form 2209 Courtesy Investigation
Form 2209A Status Report
Form 2287(C) Notice of Check not Accepted by Bank
Form 2424 Account Adjustment Voucher
Form 2547 Block Slip
Form 2848 Power of Attorney and Declaration of Representative
FMS Form 2958 Delegation of Authority
Form 3210 Document Transmittal
Form 3244 Payment Posting Voucher
Form 3244A Payment Posting Voucher (Exam)
Form 3245 Posting Voucher Refund Cancellation or Repayment
Form 3460 Transmittal Memo – Accounting Control Document
Form 3465 Adjustment Request
Form 3696 Correspondence Action Sheet
Form 3753 Manual Refund Posting Voucher
Form 3809 Miscellaneous Adjustment Voucher
FMS 3813 Schedule of Uncollectible Checks
TFS 3858 1133 Claims Package, BFS
TFS 3859 Claims Disposition Notice (CDN)
TFS 3864 Agency Recertification Follow-up
Form 3893 Re-Entry Document Control
Form 3911 Taxpayer Statement Regarding Refund
Form 3913 Acknowledgment of Returned Refund Check
Form 4338 Information of Certified Transcript Request
Form 4466 Corporation Application for Quick Refund of Overpayment of Estimated Tax
Form 4506(T) Request for Transcript of Tax
Form 4728/4728A Notice to Taxpayer of Incorrect Refund Issued
Form 4804 Transmittal of Information Returns Reported Magnetically/ Electronically
Form 4878 Voucher and Schedule of Payments
Form 5205 Information About Your Income Tax Refund
Form 5344 Examination Closing Record
Form 5461A Tax Refund Offset Program Report of Actions Under Public Laws 97-35, 98-369, 98-378, and 101-508
Form 5498 IRA Contribution Information
Form 5515 Debit Voucher – Debit Adjustments from Depository bank
Form 5792 Request for IDRS Generated Refund
TFS 6652 Statement of Difference
Form 7004 Application for Automatic Extension of Time to File Corporation Income Tax Return
Form 7831 Schedule of Accounts Written Off
Form 8050 Direct Deposit of Corporate Tax Refund
Form 8166 Input Reconciliation Sheet
Form 8288 / 8288-A Foreign Investment Real Property Tax Act
Form 8302 Direct Deposit of Tax Refund of $1 Million or More
Form 8758 Excess Collection File Addition
Form 8821 Tax Information Authorization

Exhibit 3.17.79-2 
Blocking Series Chart for Document Code "45" Form 3753, Manual Refund Posting Voucher

AO/SC CODE BLOCKING SERIES DESCRIPTION DOC CODE TC CODE PROCESSED BY
ULC 200–299 IMF/BMF REFUNDS/FORM 3753 840 Accounting
ULC 300–399 BMF (F4466 ONLY) REFUNDS/FORM 3753 840 Accounting
ULC 900 -0- AMOUNT FORM 3753 DUMMY REFUNDS TO RELEASE X- FREEZE 840 Accounting
ULC 920 IMF/BMF/NMF FORM 3753 USED WHEN TRANSFERRING REFUNDS TO PROPER ACCOUNT AND IN CONJUNCTION WITH FORM 3809 (*Optional Form 12857, top portion) 840 Accounting
ULC 600 MANUAL REFUND/DIRECT DEPOSIT IRS ERROR 840 Accounting
  • Optional Form 12857, Refund Transfer, may arrive in Accounting to transfer accounts only. These items do not create a refund condition. Forms 12857, top portion only, are numbered Doc Code 45 and separated from the bottom portion prior to sending to RACS area via Form 813.

    Note:

    If posting document requires DLN for Doc Code 45, Blocking Series 92X, aka 'dummy refunds', enter "0" (zero) in Block 4 on Form 3753 (Schedule Number) or Form 12857 (Refund Schedule Number).

Exhibit 3.17.79-3 
BFS TRACS Contact List

BFS TRACS ISSUE CONTACT NUMBER
MISSING 1081s (COPIES/DETAIL LISTINGS) (202) 874-7920
REVERSALS (1081/IPAC) (202) 874-7920
DUPLICATE ENTRIES (1081/IPAC BILLS) (202) 874-7920
TAPES (MISSING/BLANK/WRONG ALC) (202) 874-7920
TAPES (DUPLICATE/OUT-OF-BALANCE) (202) 874-7920
CHARGEBACKS (MISSING 3858s/CHECK COPY) (202) 874-7920
ECC HELP DESK (MITRON) (304) 264-7501
ITEMS NOT BELONGING TO ALC (202) 874-7920
ITEMS NOT CHARGED (202) 874-7920
SF-224 REPORTING (202) 874-7920
ACCESSING GOAL/IPAC (202) 874-7920
CREDITS (MISSING LPC/UCC/REC) (202) 874-7920
MICROFICHE (MISSING IPAC DETAIL LISTING) (202) 874-7920
CUSTOMER LIAISON (202) 874-8445
CHECK INFORMATION SECTION (202) 874-8400
MISSING SCHEDULES (1098) OPEN AN INOMS TICKET (HELP DESK)

Exhibit 3.17.79-4 
Refund Schedule Number Format

Manual Refund Schedule Number "YYYYJJJSCTAAAA"
Field Field Name Values
YYYY Year Current year e.g., 20XX
JJJ Julian Date 001-365 (366 Leap year)
SC Submission Processing Center
AUSPC 18
CSPC 17
FSPC 89
KCSPC 09
OSPC 29
T File Type
0 = BMF
1 = IMF
3 = CADE
4 = IRAF
5 = Other
6 = ANMF
AAAA Alpha Definitions See Below

Note:

If sequence for batches becomes necessary, use the available alpha such as:

  • YYYYJJJSCTD- Anti drug (1st)

  • YYYYJJJSCTBD- Anti drug (2nd)

  • YYYYJJJSCTED- Anti drug (3rd)

  • YYYYJJJSCTHD- Anti drug (4th)


A - Arbitrage (8038T)
B - RESERVED
C - Photocopy Fee (single item)
D - Anti-Drug-No longer used
E - RESERVED
F - Direct Deposit/ACH
G - General Ledger Account
H - RESERVED
I - International (AUSPC, OSPC (PSC), CSPC))
J -Dept. of Justice
K -Over $10 Million
L - Lock Box Reimbursement Theft
M - IMF/BMF/IMF IRAF/8038CP
N - Non-Master File (ANMF)
O - Offer-in-Compromise
P - Photocopy fee weekly application refund report
Q - Over $1 Million Refund
R - Informant Rewards
S - Seizure
T - Territorial (NMI, VI, GUAM, Samoa)
U - Unidentified
V - Wire Transfer
W - IDRS Generated
X - Excess Collections
Y - User Fees - No longer used
YO - AOIC User Fees - No longer used
Z - CADE

Note:

**AOIC User Fees refunds are not transcribed to post to Master File (CSPC Only)

ECC Refund Schedule Number
ECC Generated "Rebate" Checks
Field Field Name Values
YYYY Year
"YYYJJJSCTXXAA"
Current year e.g., "20XX"
JJJ Julian Date 001-365 (366 Leap year)
SC Submission Processing Center
ATSPC 07
ANSPC 08
KCSPC 09
CSPC 17
AUSPC 18
PSPC 28
OSPC 29
FSPC 89
T File Type
0 = BMF
1 = IMF
3 = CADE
4 = IRAF
5 = Other
6 = ANMF
XX ECC Generated Rebate Type See Below
 
07 - Atlanta
08 - Andover
09 - Kansas City
17 - Cincinnati
18 - Austin
28 - Philadelphia
29 - Ogden
89 - Fresno
97 - International (AUSPC)
98 - International (OSPC, CSPC)
AA Literals Two Blanks

Exhibit 3.17.79-5 
Refund Schedule Number (RSN) Translation for TAS/BETC

The link below provides access to the SPS Refund Schedule Number Alpha-TAS/ BETC Translation Chart on the SPATP, SharePoint site:
https://organization.ds.irsnet.gov/sites/SPATPBranch/default.aspx

Note:

This chart translates the RSN Alpha Definition Field Value to the existing Treasury Account Symbol. The existing Treasury Account Symbol is now converted to the new CGAC Treasury Account Symbol, which will need to be used when entering manual refund information into the Secured Payment System (SPS).

Exhibit 3.17.79-6 
Manual Refund Schedule Number/IDRS Formats as Entered into the Secured Payment System (SPS)

RSN TYPE
Manual
1/2002 FORMAT
Y=YEAR
SC=IRS CAMPUS
T=FILE TYPE (0=BMF, 1=IMF ETC.)
JJJ=JULIAN DATE
PC=LITERAL
OR
Y=YEAR
JJJ=JULIAN DATE
SC=IRS CAMPUS
T=FILE TYPE (0=BMF, 1=IMF ETC.)
AAA=VARIOUS
ALPHA/NUMERIC
2/27/2002 FORMAT 6/28/2002 FORMAT 1/2003 FORMAT CURRENT FORMAT
Y=YEAR
JJJ=JULIAN DATE
SC=IRS CAMPUS
T=FILE TYPE (0=BMF, 1=IMF, ETC.)
AAAA=VARIOUS ALPHA/NUMERIC
IDRS YJJJSCTIG   YJJJSC5IG YJJJSC5AA SAME AS 2/27/2002  
  Y=YEAR
JJJ=JULIAN DATE
SC=IRS CAMPUS
T=TYPE
IG=LITERAL
  Y=YEAR
JJJ=JULIAN
DATESC=IRS CAMPUS
5=LITERAL
IG=LITERAL
Y=YEAR
JJJ=JULIAN DATE
SC=IRS CAMPUS
5=LITERAL A=W, WI
   
IMF SAME AS 12/2001   SAME AS 12/2001 SAME AS 12/2001 YJJJSCTAAA  
          Y=YEAR
JJJ=JULIAN DATE
SC=IRS CAMPUS
1=LITERAL
AAA=I, FI, SPACES
 
ECC Rebate Checks           YYYYJJJSCTXXAA
            Y=YEAR
JJJ=JULIAN DATE
SC=IRS CAMPUS
T=FILE TYPE
XX=ECC GENERATED REBATES TYPES
AA=BLANKS

Exhibit 3.17.79-7 
Blocking Series Chart for Document Code 45, SF 1098 and TRACS Processing

AO/SC CODE BLOCKING SERIES DESCRIPTION DOC CODE 45 TRANSACTION CODE PROCESSED BY
SC 220–299 REPAYMENT OF ERRONEOUS IMF/BMF FORM 3245 720 RECEIPT AND CONTROL
ULC 500–519 IMF/BMF SF 1098
FORM 3245
841/740 ACCOUNTING
ULC 520–529 ANMF SF 1098
FORM 3245
841/740 ACCOUNTING
ULC 530–539 IMF-IRAF SF 1098
FORM 3245
841/741 ACCOUNTING
ULC 540–549 IMF/BMF/
ANMF
TFS 3813/
FORM 3245
843/742 ACCOUNTING
ULC 550–554 IMF/BMF SF 1081 DEBIT/
POC TRACS
FORM 3245
843 ACCOUNTING
ULC 550–553 IMF/BMF SF 1081 DEBIT
SETTLEMENT
AUTHORIZED
FORM 3245
840 ACCOUNTING
ULC 555 INTERCEPTED
CHECKS
MANUALLY
PROCESSED
1098 LISTING
SF 1098/
FORM 3245
841 ACCOUNTING
ULC 666 IMF/BMF/
ANMF
LIMITED PAYABILITY
CANCELLATION
CREDIT/
TRACS
FORM 3245
740 ACCOUNTING
ULC 800 REPAYMENT OF ERRONEOUS REFUNDS ANMF FORM 3245 720 RECEIPT AND CONTROL

Exhibit 3.17.79-8 
Reason For Cancellation Codes (SF 1098)

RRC CODE Description Trans. Code Freeze Code Block and Serial Number
01 Intercept Checks 841 P- 55555
02 Undeliverable Checks 740 S- 99999
03 Returned Checks (other than intercepted or undeliverable) 841 P- 99999
08 Unavailable Check Cancellation Credit (returned on outstanding checks as a result of a check claim, CC CHKCL/Status 32) 841 P- 88899
09 Unavalable Check Cancellation Credit 841 NONE 88888
09 Reclamation Credit 841 NONE 88000
09 Outstanding check as the result of a paper 1184 841 NONE 88111
11 Taxpayer correspondence attached. (Also could include a photocopy fee refund cancelled that would not show on the MF.) 841 NONE 99999
40 Limited Payability (LP) expired credit 740 S- 66666
666XX (prior to 1992)
71 Unavailable Check Cancellation Offset Return. As a result of an agency claim, only the TOP offset amount of the original payment is returned. See IRM 21.4.6, Refund Offset. 841 See IRM 21.4.6
Refund Offset
88888
72 Unavailable Check Cancellation Partial Payment Return. As a result of an agency claim, only the net amount of the original payment after TOP offset is returned. See IRM 21.4.6 Refund Offset. 841 See IRM 21.4.6
Refund Offset
88888

Exhibit 3.17.79-9 
Form 3809 Miscellaneous Adjustment Voucher

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