Part 3. Submission Processing

Chapter 21. International Returns and Documents Analysis

Section 264. IRS Individual Taxpayer Identification Number (ITIN) Acceptance Agent Program (Cont. 1)

3.21.264  IRS Individual Taxpayer Identification Number (ITIN) Acceptance Agent Program (Cont. 1)

3.21.264.4 
Acceptance Agent Application Processing (For Austin e- help Desk Use Only)

3.21.264.4.2 
Processing Acceptance Agent Applications

3.21.264.4.2.7  (02-28-2012)
EIN Change

  1. If a business currently approved for participation in the Acceptance Agent program is assigned a new EIN because of an entity change (IRM 3.21.264.3.9, Changes to Form 13551, Acceptance Agent Application), another Form 13551 reflecting the new EIN is required; however, it will be processed as an amended application.

  2. Access the existing EIN and enter a comment that the entity has changed and a new EIN issued. Include the new EIN in the comment. Do NOT enter the new application in RTS. The ITIN Policy Section will make any RTS changes.

  3. A tax compliance check will be conducted on the new EIN. A check will also be conducted on the old EIN to ensure that any previous tax liabilities for the firm have been addressed. List any outstanding liabilities for the previous EIN on the Profile Sheet for review and consideration by the IPS.

  4. Any new Authorized Representatives listed on the amended application are also subject to the tax compliance and background investigation checks.

3.21.264.4.2.8  (08-20-2012)
Profile Sheet

  1. A Profile Sheet (Exhibit 3.21.264-26), Acceptance Agent Suitability Profile Sheet will be completed for any Acceptance Agent application forwarded to the ITIN Policy Section.

  2. For applications with multiple locations, a separate Profile Sheet will be prepared for each location only when the authorized representatives are different at each location. Paper clip the Profile Sheets together and assemble the packet as indicated by IRM 3.21.264.4.5, Application Documentation Packet. Annotate the top margin of the topmost Profile Sheet with the number of locations associated with the application. Example: "2 locations" .

  3. Profile Sheets are not required for incomplete applications.

  4. Assistors will annotate the Profile Sheet as follows:

    • Under the FBI BACKGROUND CHECK block, check the appropriate box. See IRM 3.21.264.4.4 (Background Investigation Checks) for additional information on whether an Authorized Representative is subject to a background investigation. (Other entries in the section will be completed by the clerical staff when the fingerprint card(s) is processed).

    • Under the Revocation block, enter the date and an appropriate comment if notification is received from the Andover e-help Desk that an Authorized Representative who was also an ERO had their electronic filing privileges terminated. See IRM 3.21.264.4.1.8 (Revocation).

    • Under the SUITABILITY RECOMMENDATION check the appropriate radio button reflecting whether the business and/or Authorized Representative passed or failed the tax compliance check. Annotate in the appropriate block any suitability issue(s) supporting a failure recommendation. Disregard the radio buttons on whether there was a history of late filing and what IDRS command codes were used during any tax compliance research.

    • If the Form 13551 is amending an existing agreement to add an additional location without any new Authorized Representatives or update existing information such as an address or contact information, indicate the reason for the amended application in one of the issues boxes. Example: "Amended F13551 to change alternate contact" .

    • Sign the Profile Sheet and annotate their SEID and date in the appropriate area.

  5. If the application packet is reviewed, the Lead/Reviewer will:

    • Check the appropriate radio button indicating their recommendation.

    • Sign the Profile Sheet and annotate their SEID and date in the appropriate area.

    • Make any comments on the back of the Profile Sheet. Highlight (in yellow high lighter) the notation that there are comments on the reverse page.

3.21.264.4.2.9  (08-20-2012)
RTS Application Status Codes

  1. When an application is being entered in RTS:

    • Select status "I1 - In Process IRS Check" if inputting a complete application into RTS prior to conducting any suitability checks

    • If application is being returned as incomplete, select "I2 - Incomplete/Invalid Application" .

    • If the EIN fails the business tax compliance check, select status "F1 - Failed IRS Tax Compliance Check"

    • If the EIN passes the tax compliance check but all Authorized Representative(s) fail their personal tax compliance check, select status "F1 - Failed IRS Tax Compliance Check" .

    • If the EIN passes the tax compliance check and at least one Authorized Representative passes their personal tax compliance check, select status "P2 - Passed Suitability Checks" .

  2. After the tax compliance status has been updated, if an Authorized Representative requires FPC processing, change the status from "P2" to "I3 - In Process FBI Check" . Once results of the background investigation are received:

    • If no data was found, change status from "I3" to "P4 - Passed FBI Check" .

    • If data was found, change status from "I3" to "P1 - Passed ERO Status" .

  3. If the FPC was rejected as unprocessable and no additional FPC is available to process:

    • If the application only reflected the Authorized Representative whose FPC could not be processed, return the application as incomplete. Change status in RTS from "I3" to "I2 - Incomplete/Invalid Application" . Remove any TPDS or IDRS screen shots/IAT printouts attached to support the previous tax compliance recommendation.

    • If the application contains at least one Authorized Representative that passed their background investigation, change the status from "I3" to "P4 - Passed FBI Check" . Use the Letter 4954, Rejected Fingerprint Cards (FPC). See Exhibit 3.21.264-19 and IRM 3.21.264.4.6.10, Rejected Finger Print Cards (FPC) to return the FPC to the owner/principal for the authorized representative(s) whose FPC was unprocessable..

3.21.264.4.2.10  (08-20-2012)
Multiple Locations

  1. Except for applications that reflect only one mailing address, each business location on an application will be entered as a separate record in RTS.

  2. If a Form 13551 is reflects multiple business locations but only one mailing address, input only the location on Line 12 from Page 1 into RTS.

    • If the Form 13551 is being returned as incomplete, do not mention the single mailing address issue in the incomplete letter. However, include a comment in RTS that the Form 13551 contained multiple locations but only one mailing address.

    • If the application reflects authorized representatives for the different locations, still conduct their suitability/tax compliance checks but record each individual's results under one RTS record.

    • If the application is being passed, include a RTS comment on the one record that the Form 13551 reflected additional locations. Notate on the Profile Sheet the application the number of additional locations but that the Form 13551 had only one mailing address.

    • If the application is being rejected, notate the Profile Sheet the number of additional locations but that the Form 13551 had only the one mailing address. Indicate the reason(s) for the rejection as a comment in RTS and that the application reflected multiple locations but only one mailing address.

      Note:

      Do not list the other business address locations in the RTS comments.

3.21.264.4.3  (08-20-2012)
Tax Compliance Checks

  1. A business and all authorized representatives must successfully pass all facets of the tax compliance check to be accepted in the ITIN Acceptance Agent program.

  2. The checks performed determine:

    • If all business and personal tax returns are filed timely,

    • If all tax liabilities are paid or appropriately addressed (e.g., installment agreement), and

    • If a fraud penalty has been assessed.

  3. To reduce taxpayer burden, tax compliance checks will also be conducted on applications being returned as incomplete whenever possible. Any compliance failures will be included with the incomplete application letter. See Exhibit 3.21.264-10 Letter 4963, Incomplete Application Letter.

    Note:

    If the application does not reflect an EIN or it is invalid, do not conduct the tax compliance on any Authorized Representative(s) since a valid EIN is required to capture any tax compliance or suitability issues in RTS. Conduct the checks once the application is returned with a valid EIN.

    Note:

    Individual tax compliance failure can only be addressed to the individual to whom they pertain . When returning an incomplete application with multiple authorized representatives one of which has failed their compliance check, separate letters are required. Include a statement in the incomplete letter addressed to the principal/owner an individual listed as an authorized representative(s) did not pass the internal suitability check. However, do not include the name of the individual that did not pass the required suitability check nor indicate the reason for the failure

    .

  4. The business compliance check for applications from a sole proprietorship includes either an appropriate business return (example: Form 1065) or a Schedule C/C-EZ on their personal Form 1040. Application should be rejected if missing.

  5. The following table reflects when an application is accepted or rejected for tax compliance checks.

    Note:

    "Acceptance" of an application is limited to the Austin e-help Desk's portion of the application process. Final acceptance into the program is at the discretion of the ITIN Policy Section.

    If... and... and... then...
    authorized representative has an ITIN (Item 7) resides in the U.S. (Line 8) no other authorized representatives are listed on the application that have a SSN application is rejected (no compliance checks are conducted)
    application has at least one authorized representative with a SSN conduct a tax compliance check on the EIN
    resides outside of the U.S. (Line 8)   conduct a tax compliance check on the EIN
    business fails     application is rejected
    business passes application consists of one Authorized Representative the Authorized Representative passes their individual tax compliance check the application is accepted
    the Authorized Representative fails their individual tax compliance check the application is rejected
    application consists of multiple Authorized Representatives at least one Authorized Representative passes their individual tax compliance check the application is accepted but only the Authorized Representative(s) that pass their tax compliance check are reflected in RTS
    no Authorized Representative pass their individual tax compliance check the application is rejected

  6. Results of a tax compliance check will be entered as Comments in RTS. Record business results separately from individuals. Individual results will be recorded by name regardless if application contains multiple Authorized Representatives.

3.21.264.4.3.1  (08-20-2012)
Submission of Required Returns

  1. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  2. Allow 45 days from the due date for processing of the return.

  3. A tax compliance check is conducted on the joint return if the applicant is the secondary tax payer on the account.

  4. All current year individual applications processed after April 15th require an approved extension shown on IDRS as transaction code (TC) 460).

    Note:

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

  5. All businesses must file all returns listed under the Filing Requirements.

    Note:

    Nonprofit organizations with annual receipts less than $50,000 are required to file a Form 990-N (e-Postcard) only once every three years.

  6. Returns with disaster freeze codes of "-O" or "-S " may have been automatically extended past the return due date. Refer to the www.irs.gov home page. Type "Tax Relief in Disaster Situations IRS" in the upper right search window and check the news releases for their location and required due dates.

  7. Individual returns with a freeze code of "-C" had their filing deadline extended because of combat zone service. Type "Extension of Deadlines — Combat Zone Service" in the search window on the IRS web site at www.irs.gov to determine required due date. Research CC IMFOLE for the Combat indicator on Line 11.

    • If Combat indicator is "1" , then the taxpayer is still serving in a combat zone. Any compliance activity such as assessing or collecting tax is prohibited.

    • If Combat indicator is "2" , then the taxpayer is no longer a combat zone participant. Follow normal IRM procedures to work the case.

  8. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ " ≡ ≡ ≡ ≡ "≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  9. IAT may be used to identify missing returns for an Authorized Representative. However, if a return is identified as not being filed, review the income information using IRPTL. Exclude any income reported under a different name and determine if any remaining income exceeds that year's filing requirements. If it does or if all income was reported under the Authorized Representative's name, reject their participation using Letter 4958; otherwise the Authorized Representative is not liable for the missing return.

  10. Exhibit 3.21.264–32 reflects the more common income tax returns, the corresponding Filing Requirement Code (FRC) and Master File Code (MFT) reflected in IDRS and their due dates. If an entity reflects other filing requirements, research IDRS, Document 6209 and IRS website to determine if the return is required for quarterly or annual submission.

3.21.264.4.3.1.1  (08-20-2012)
Return Status Codes

  1. Use the following table to determine the status of a tax module and whether it passes or fails:

    STATUS CODE DEFINITION PASS FAIL
    02 Delinquent Return   X
    03 Delinquent Return in Collection Status   X
    04 Extension to File Return NOTE 1
    06 Taxpayer is not liable for that return NOTE 2
    10 Filed Return X  
    12 Filed Return and Fully Paid X  
    21 1st Notice for a BALDUE Return   X
    22 Taxpayer Delinquent Account (TDA)   X
    23 Return filed but below TDA tolerance NOTE 3
    48 System generated to suppress BALDUE notice   X
    53 Currently Not Collectible   X
    54 2nd Notice for a BALDUE return   X
    56 3rd Notice for a BALDUE return   X
    58 4th Notice for a BALDUE return   X
    60 Current Installment Agreement X  
    61 Suspended Installment Agreement   X
    63 Installment Agreement X  
    64 Defaulted Installment Agreement   X
    71 Offer in Compromise (OIC) pending X  
    72 Litigation/bankruptcy X  

    Note:

    1. For current year returns on an unexpired extension: Pass; otherwise Fail.

    Note:

    2. For a business return(s) status "06" is acceptable to pass that module. For individual (Form 1040) returns, status code "06" normally indicates a spouse on a Married Filing Jointly (FSC 2) return but requires research. If the return was filed jointly, tax period would pass. If not filed jointly, research IDRS using CC IRPTR to determine whether the module should be passed or failed.

    Note:

    3. Although the return has been filed, the tax compliance may fail because of the outstanding tax liability. If the liability no longer exists, is covered by an Installment Agreement, bankruptcy, OIC or an uncollectable: Pass; otherwise Fail.

  2. Research IDRS (CC SUMRY) or SC-STS (Service Center Status) on (CC TXMODA) to determine the most current status of a module.

  3. If status is other than above, check with Lead or Manager to determine if the module should be considered to have fulfilled the requirement for submission of a required return.

3.21.264.4.3.2  (01-01-2012)
Outstanding Tax Liability

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

  2. Exceptions include:

    1. Bankruptcy TC 520 unless reversed by a TC 521.

    2. Offer in compromise (OIC) TC 480 with a collection code 71 (OIC pending) or TC 780 (OIC accepted) unless reversed by a TC 781 (defaulted on OIC)

    3. Uncollectible account TC 530 unless any of the following closing codes are present:

      Closing Codes Definition
      03 Unable to locate
      09 Tolerance
      10 Defunct corporation
      12 Unable to contact
      13 In-Business corporation
      39 ACS cases with low RWS score

    4. Installment agreement (IA) (status code 60)

3.21.264.4.3.3  (03-02-2012)
Fraud Penalty

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

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ including MFT 55 and MFT 13. Do not check just the last six years for the adjustment.

  2. Regardless of the amount, a fraud penalty must be fully abated or reversed (TC 321) for an individual or business to pass this aspect of their tax compliance check.

3.21.264.4.3.4  (06-18-2012)
Business Employer Identification Number (EIN) Tax Compliance Check

  1. A business tax compliance check is required for all new and renewal applications with an active/valid EIN. It is not required if an existing/approved agreement is amended to add a new location or additional authorized representatives.

  2. A business must pass the tax compliance check to be accepted into the ITIN Acceptance Agent program.

  3. Use IDRS CC INOLES to determine the filing requirements for a business.

  4. Business compliance checks are conducted using tax modules on IDRS.

  5. If a business does not pass, the application is rejected and returned. See IRM 3.21.264.4.6.5, Business Tax Compliance Failure (Owner). List the specific reasons for the failure in the letter (see IRM 3.21.264.6.6) and in the Comments section of RTS.

  6. If an EIN is cross-referenced in IDRS to another (parent) EIN, returns for the child entity may have been submitted as part of another. If the EIN fails a component of a tax compliance check but states in a response to the rejection notice the return was filed as part of a parent organization's return, research the parent EIN as necessary.

3.21.264.4.3.5  (08-20-2012)
Individual Tax Compliance Check

  1. All authorized representatives listed on a new or renewal application must pass a tax compliance check of their individual tax liabilities. Authorized representatives being added to an existing/approved ITIN Acceptance Agent agreement also must pass a tax compliance check of their individual tax liabilities.

    Note:

    Do not conduct a tax compliance check for authorized representatives residing in the U.S. that have an ITIN. Reject such applications using Letter 4958, Individual Suitability Failure (Individual) and/or Letter 4959, Individual Suitability Failure (Owner).

  2. A compliance check is not required for individuals listed only as a Primary or Alternate Contact on the Form 13551.

  3. If an application has multiple authorized representatives, conduct the tax compliance on each. If an individual fails the check:

    • Circle their name on the Form 13551 in red ink.

    • Enter a Comment in RTS that indicates who failed their compliance check and why (i.e., BAL DUE of $xxx, missing TY 2008, F1040, etc.)

    • Do not enter their name or other personal information as an authorized representative in the ITIN Acceptance Agent Application screens in RTS.

    • Notate on the Profile Sheet the name of the individual that failed their check.

    • Prepare appropriate rejection letter.

    • Put the entire application (including supporting documentation and rejection letter on the individual) on the "PASSED" shelf.

  4. Individual compliance checks are conducted using tax modules on IDRS (MFT 30).

  5. For an application that lists only one authorized representative who is also listed as the principal, partner or owner; If they do not pass their tax compliance check, the application will be rejected and returned using Letter 4959 , Individual Suitability Failure (Owner).

  6. For an application that reflects only one authorized representative who is not the principal, partner or owner and they fail their individual suitability check, the application will be rejected and returned using Letter 4958, Individual Suitability Failure (Individual) and Letter 4959, Individual Suitability Failure (Owner).

    • Use Letter 4959, Individual Suitability Failure (Owner) to notify the principal, partner or owner an individual listed on their application did not pass our suitability check. Do not indicate the name of the individual nor the specific reason(s) for the failure in the letter.

    • Use Letter 4958, Individual Suitability Failure (Individual) to notify the authorized representative they did not pass the suitability check and the reason(s) why.

  7. For an application that contains multiple authorized representatives and at least one passes their individual tax compliance check while the other(s) do not, process the application with just the representative(s) who passed.

    • Use Letter 4959, Individual Suitability Failure (Owner) to notify the principal, partner or owner that we are processing their application but one or more individual listed on it dod not pass our suitability check. Do not indicate the names(s) of the individual nor the specific reason(s) for the failure in the letter.

    • Use Letter 4958, Individual Suitability Failure(Individual) to notify the authorized representative(s) they did not pass the suitability check and the reason(s) why.

  8. If during the course of processing an Acceptance Agent application, research reveals an Authorized Representative is listed on another existing/approved application under a different EIN, conduct another (new) tax compliance check.

    • If the Authorized Representative fails their tax compliance check, follow paragraphs 3, 5 and 6 above.

    • If the Authorized Representative passed their tax compliance check, include a comment in RTS and notate the Profile Sheet the EIN, EFIN or office location code of the other organization they are listed on as an Authorized Representative. Highlight the annotation so the IPS will know to pull the file since, generally, an individual can only be listed under one EIN.

  9. If IDRS (CC IMFOLI) reflects the IRS has created a Substitute for Return (SFR) for the taxpayer (reflected as "SUBST4" under the Posted Return column) and the module falls within the period specified in IRM 3.21.264.4.3.1, notify the Authorized Representative it is required unless:

    • An amended return for the module has been received.

    • IMFOLT reflects a TC 599 for the module indicating the taxpayer has accepted the SFR return and is, therefore, considered to have been filed.

3.21.264.4.4  (08-20-2012)
Background Investigation Checks

  1. Except as indicated in the following paragraphs , all authorized representatives listed on an ITIN AA application are subject to a background investigation conducted by the FBI. Investigation is conducted by processing of a fingerprint card (FPC).

  2. Applications from the following organizations are exempt to the fingerprint processing requirement:

    • A college or university that qualifies as an educational organization under Treasury Regulations 1.501(c)(3)-1(d)(3)(i). Note: Educational institutions must be a college or university. Authorized representatives from educational institutions that are not a college or university must provide a FPC unless they are an attorney, Certified Public Accountant (CPA), or Enrolled Agent (EA).

    • Casinos

    • Federal government agencies

    • VITA/TCE partners

    • Officials from financial institutions

  3. Selected individuals are also exempt from the background check if they provide proof of their active/unexpired professional status. These individuals are:

    • An attorney that is a member of a State Bar (or equivalent)

    • A Certified Public Accountant (CPA) licensed by a State Board of Accountancy (or equivalent)

    • Enrolled Agent (EA)

  4. If an exempted individual does not provide a copy of their professional status with their application, attempt to verify it as follows:

    • For an attorney, research their State’s Bar Association’s web site.

    • For a CPA, research their State’s Board of Accountancy web site.

    • For an EA, contact the Office of Professional Responsibility at 1(202) 927-3397.

  5. If a state’s web site supports the individual’s claim of professional status, print a copy of the web page and include it with the application packet. If unable to verify their status or it is expired, return the Form 13551 for a document supporting their professional status using Letter 4963, Incomplete Application Letter. Applicants can also submit a fingerprint card in lieu of professional documents.

  6. Authorized representatives who are a Principal or Responsible Official (RO) on any current, active and approved electronic filing (e-file) application are not subject to an additional background investigation.

  7. Regardless of an organizational exemption or an individual's professional status, any Authorized Representative that answers "yes" to Item 10 (preparer penalty or criminal conviction) must submit a FPC. FPCs are submitted to FBI for a background check.

  8. Fingerprints must be submitted using Form FD-258 with either blue or black lines. An electronically scanned FPC is acceptable. FPC must be:

    1. An original card (no photocopy).

    2. Signed by applicant.

    3. Signed by person taking fingerprints. Include the following minimum personal information

    • Applicant’s name.

    • SSN (except for foreign applicants).

    • Sex

    • DOB

    Note:

    To prevent delays when processing their application, it is recommended required applicants submit two FPC. An application will not be returned as incomplete if only one card per authorized representative is initially received.

  9. FPC processed in support of the ITIN Acceptance Agent program must reflect the Austin Originating Requestor Identifier (ORI) code of TXIRS000Z. Affix a prepared label if the ORI is blank or shows a different ORI.

  10. A background investigation is not conducted for:

    • Applications rejected for failure of the business tax compliance check, or

    • Any authorized representative that fails the individual tax compliance check, or

    • Applications returned as incomplete.

  11. Documents required for a background investigation check:

    IF and and has Then
    Authorized Representative responded "Yes" to the Question on Line 10   FPC is required
    Application is from:

    • Federal Government Agency

    • Casino

    • Educational Institution

    • Financial Institution

    • VITA/TCE Partner

    		   No FPC are required
    Authorized Representative is a foreign national On TPDS as a Principal or Responsible Official on a completed/approved e-file application Use TPDS results
    Not on TPDS Has maintain U.S. professional status as a CPA, Attorney or Enrolled Agent Proof of Professional Status may be submitted in lieu of FPC
      No U.S. Professional Status FPC is required
    CPA or Attorney On TPDS as a Principal or Responsible Official on a Completed/approved e-file application Use TPDS results
    Not on TPDS Proof of Professional Status or FPC
    Enrolled Agent On TPDS as a Principal or Responsible Official on a completed/approved e-file application Use TPDS results
    Enrolled Agent Not on TPDS Proof of Enrolled Agent or FPC
    All others (includes city, county or state agencies or military organizations) On TPDS as a Principal or Responsible Official on a completed/approved e-file application Use TPDS results
    Not on TPDS FPC is required

3.21.264.4.4.1  (01-01-2011)
Control of Fingerprint Cards

  1. Fingerprint cards (FPC) identified for processing by the FBI are controlled with an Excel spreadsheet by an e-help Desk clerk. The ITIN FPC Tracking spreadsheet is located on the web site "O-Drive > Shortcut to Batch > ITIN AA Apps folders" .

  2. The ITIN FPC Tracking spreadsheet is updated when FPC are submitted to the FBI, when results are received, and if there was information (data) or no information (no data).

  3. On the 15th of each month, the e-help Desk clerk will E-mail a copy of the spreadsheet to the IPS and the Program and Management Analyst in EPSS.

3.21.264.4.4.2  (08-20-2012)
Processing of Fingerprint Cards

  1. If an authorized representative passes the tax compliance checks but requires background investigation check, the assistor will:

    • Notate the EIN in the larger "LEAVE BLANK" block on the FPC.

    • Annotate the block "1/1" if only one FPC was received for the authorized representative. If two cards are received, annotate one with "1/2" and the other with "2/2" .

    • Staple a FPC cover sheet to the front of the folder as shown in Exhibit 3.21.264-8, Finger Print Card (FPC) Cover Sheet.

    • If authorized representative is a foreign national, annotate the top margin of the FPC cover sheet with "FOREIGN" in red ink.

    • Enter a comment in RTS with the name of each authorized representative whose FPC was pulled for processing. Make separate entries for each authorized representative.

    • Change the RTS status to "I3 - In-Process FBI Check" .

    • Complete a Profile Sheet with their recommendation and indicate on it the FPC was pulled.

    • Put the application on the "PASSED" shelf in the left-most cubby.

  2. If selected for review, a Lead/Reviewer reviews the assistor’s recommendation and take the following actions:

    • If they disagree or find RTS errors, return the application to the appropriate assistor and discuss their finding(s).

    • If they agree with the recommendation or if it is not selected for review, sign the Profile Sheet and put the folder in the basket for FPC processing.

  3. Daily, a designated e-help Desk clerk or assistor review the folders in the FPC basket to determine if they must be sent to the FBI or can be processed by the Automated Electronic Fingerprint (AEF) system.

3.21.264.4.4.2.1  (08-20-2012)
Fingerprint Cards Sent to the FBI

  1. Effective April 15, 2012, the FBI will no longer accept paper FPC for processing. Until the AEF system can be modified to accept fingerprint cards from foreign nationals without a SSN, the FPC will be annotated with the SSN "999-99-9999" in red ink and processed in the AEF system. See IRM 3.21.264.4.4.2.2, Fingerprint cards Processed using Automated Electronic Fingerprint (AEF) System.

3.21.264.4.4.2.2  (06-13-2012)
Fingerprint Cards Processed using Automated Electronic Fingerprint (AEF) System

  1. The e-help Desk clerk (or designated assistor) is responsible for processing FPC from authorized representatives with a SSN using the AEF system. Do not use the AEF system until after 2 p.m. (CT) unless prior approval is received from the e-help Desk East’s Department Manager as the system is also used by the Andover e-help Desk.

  2. Process the FPC using the Cogent System’s IRS Fingerprint Card Submission System (FCSS) Users Guide. Employees must:

    • Ensure the FPC lists the Austin ORI. Attach the available stickers to any FPC with a blank or different ORI.

    • Select Austin’s ORI information from the appropriate drop-down field when entering the demographics information for the FPC.

  3. If results are received in the same session, print a copy of the results and include it in the folder. See IRM 3.21.264.4.4.3, Processing of FPC Results, for additional instructions.

  4. Update the ITIN Fingerprint Tracking spreadsheet with the date the FPC was scanned and that the AEF system was used.

  5. File any folder for which results were not received on the bottom shelf of ITIN AA Cart in EIN sequence. Review the AEF for subsequent processing/results and, if found, print results. See IRM 3.21.264.4.4.3, Processing of FPC Results.

3.21.264.4.4.3  (01-01-2011)
Processing of Finger Print Card (FPC) Results

  1. FPC processing results include:

    • No data found. Indicates there was no record of any criminal activity in the FBI data base by the authorized representative.

    • Data found. Indicates the FBI data base shows criminal activity.

      Note:

      The presence of data does not in itself mean a conviction. Data will also be indicated for individuals that were only charged, found innocent, or had the charges dismissed.

    • Rejected. FPC that could not be processed for various reasons are rejected.

  2. If FPC for multiple authorized representatives are processed, include the name of the appropriate individual when Comments are entered in RTS. An example is "FBI results received: No data found on A Lincoln. Data found on G Washington " . Do NOT include the actual activity. Forward the application to the IPS once all results are received.

3.21.264.4.4.3.1  (06-13-2012)
Finger Print Card (FPC) Results-No Data Found

  1. If the results of the background check do not identify any criminal activity, the e-help Desk clerk or designated assistor will:

    • Update the ITIN FPC tracking spreadsheet with the date of the results and notation "No Data" .

    • Annotate Profile Sheet that no data was found and date/initial the sheet.

  2. Update RTS by selecting "Change Status" as reason for change and enter the comment "FPC processed for [name of individual] - no data found" .

    Note:

    If results were received from multiple Authorized Representatives for the same location, enter a separate comment for each individual.

    • Change the RTS application status to "P4 – Passed FBI Check" .

    • If FPC results were for the Authorized Representative whose personal data is reflected in RTS (i.e., SSN, DOB, etc.), change radio button for "FBI Criminal Background Passed?" to "Yes" and enter date of the FBI check in the adjacent field.

    • If RTS reflects the personal data for a different Authorized Representative, do not make any entries for the "FBI Criminal Background Passed?" and date fields.

  3. Attach the FPC and results to the packet and put in basket for subsequent forwarding to the IPS.

3.21.264.4.4.3.2  (08-20-2012)
FPC Results-Data Found

  1. If the results of background check identify any criminal activity, print the AEF rap sheet. The e-help Desk clerk or designated assistor will:

    • Update the ITIN FPC tracking spreadsheet with the date of the results and notation "Data" .

    • Annotate the Profile Sheet that data was found and date/initial the sheet.

  2. Update RTS:

    • Select "Change Status" as reason for change and enter the comment "FPC processed for [name of individual] - data found" .

      Note:

      Do NOT include the actual activity in the comments. Also, if results were received from multiple Authorized Representatives for the same location, enter a separate comment for each individual.

    • Change the application status to "P1 – Passed ERO Check" .

    • If FPC results were for the Authorized Representative whose personal data is reflected in RTS (i.e., SSN, DOB, etc.), change radio button for "FBI Criminal Background Passed?" to "No" and enter date of the FBI check in the adjacent field.

    • If RTS reflects the personal data for a different Authorized Representative, do not make any entries for the FBI "Criminal Background Passed?" and date fields.

  3. Attach the FPC and rap sheet results to the packet and put in basket for subsequent forwarding to the IPS.

3.21.264.4.4.3.3  (08-20-2012)
Finger Print Card (FPC) Results-Reject

  1. The following actions will be done by the e-help desk clerk (or designated assistor):

    • If a FPC is rejected by the FBI, a second FPC may be submitted for processing at no additional cost to the IRS. If the second FPC also rejects, a request for a manual name check is required.

    • Print a copy of the rejection notice by clicking on the FBI results icon in the Automated Electronic Fingerprinting (AEF) system.

  2. Notate the ITIN FPC Tracking spreadsheet that the FPC was rejected, date of rejection, and the Terminal Control Number (TCN) indicated on the rejection notice.

  3. If the applicant did not submit a second FPC:

    • Using Letter 4954, Rejected Finger Print Cards (FPC), see IRM 3.21.264.4.6.10, return the application and all associated documents including the rejected FPC to the applicant.

    • Update the ITIN FPC spreadsheet to show the FPC was rejected with the date of rejection. Notate the IAFIS (Integrated Automated Fingerprint Identification System) Control Number and date of letter in the Remarks column.

    • Update RTS by selecting "Change Status" as the reason for change. Enter the comment "FPC rejected. Additional FPC not available. Requested additional FPC" . Change the application status to "I2 – Incomplete/Invalid Application" .

  4. If the applicant submitted a second FPC, process it. Update the ITIN FPC Tracking spreadsheet with the date and appropriate information for the second FPC.

  5. Scan the second FPC in AEF. When the demographics data is entered, the system will display a notice that a previous FPC was submitted and if the TCN should be included for the current submission.

    • If the TCN was for the FPC previously rejected, highlight the row and click on the "Select This TCN" button to add it.

    • If the TCN was for another submission (e.g., an e-file application or prior Acceptance Agent application from a prior year) do not click on the "Select This TCN" button.

  6. If the second submission results:

    • If no data, see IRM 3.21.264.4.4.3.1, FPC Results-No Data Found.

    • If data was found, see IRM 3.21.264.4.4.3.2, FPC Results-Data Found.

  7. If the second FPC also rejects:

    • Update the ITIN FPC Tracking spreadsheet with date of the rejection, that the FPC rejected, and the TCN of the second rejection.

    • Submit a Name Check using the request at Exhibit 3.21.264-9, "Request for Name Check and Fax Cover Sheet" . Enter the TCNs for both rejections as indicated.

    • Note:

      Fax the Name Check request to the FBI at ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

    • Update the ITIN FPC Tracking spreadsheet with the date, type "NAME CHECK " and other information as appropriate.

    • Enter a comment in RTS indicating a Name Check request was submitted. (Example: "Name Check request for John Doe faxed to the FBI" ). Include date of the Name Check request if different than the date the RTS entry is being made. (Example: "Name Check request for John Doe faxed to the FBI on 3/12/2012" ).

    • Re-file the application on the third shelf of ITIN AA cart pending results.

  8. When results of the name check are received, see IRM 3.21.264.4.4.3.1, FPC Results-No Data Found, or IRM 3.21.264.4.4.3.2, FPC Results-Data Found, as appropriate.

3.21.264.4.4.3.4  (06-13-2012)
FPC Results-No Results Received

  1. To ensure FPC results are received in a timely manner, the e-help Desk Clerk or designated assistor will monitor their receipt.

  2. Weekly, a report is run in RTS to identify applications in a "I3 - In-Process FBI Check" . Compare the results with the folders on the ITIN AA cart pending receipt of FPC results.

  3. Resolve any discrepancies between the folders on the cart and the RTS printout. Review the folders to determine when the FPC were submitted:

    • Results of FPC submitted using the AEF system should be received within 24 hours. If not received, notify a Lead/Manager who will research the delay.

    • Requests for a Name Check faxed to the FBI should be answered within 10 days. If not, notify a Lead/Manager who will contact the Program and Management Analyst in EPSS who will contact the FBI for assistance.

3.21.264.4.5  (06-13-2012)
Application Documentation Packet

  1. To facilitate the review process and ensure IRS proprietary documents are not disclosed to unauthorized individuals, it is critical ITIN Acceptance Agent applications be assembled properly. Depending on the application's status and the recipient, each has a different assembly requirement.

  2. Documents in each packet will be assembled in the order indicated.

3.21.264.4.5.1  (07-06-2012)
Incomplete Application Documentation Packet

  1. If an application is being returned to an applicant because it is incomplete, assemble it as follows: Staple together:

    • The undated incomplete letter (however, letter will be stamped with the e-help Desk Operation's Manager's signature).

    • Form 13551 (To preclude confusion if the Form 13551 is subsequently returned, delete the Batch Control number and all IRS received date notations/stamps with either a single line or "x" in red ink).

    • Except for FPC, all other documents received with the application.

  2. Behind the assembled packet, paper clip any FPC received with the application or if FPC are being included as part of the incomplete letter.

  3. Classify the envelope in which the application was received.

    Note:

    Do not return any IDRS, IAT, RTS, or TPDS screen prints created while processing the application.

3.21.264.4.5.2  (08-20-2012)
Passed Application Documentation

  1. For new, renewal or amended applications adding an additional authorized representative that is being recommended to PASS:

    • If application contained multiple authorized representatives and one (or more) of the representatives failed their individual tax compliance check:

    • For packet being sent to the failed applicant(s):

    • Rejection letters(s) as the top most document. If applicable, paper clip any FPC behind the rejection letter.

  2. If application included an authorized representative requiring a background investigation by the FBI, place FPC as the next/top most document.

  3. Except for applications being returned as being incomplete, after any rejection letters and/or FPC, assemble the packet being sent to IPS. Staple the following documents together:

    • Profile Sheet signed by the assistor and annotated with their SEID and date

    • Form 13551

    • Training completion statement

    • All other document(s) received with the application (including any FPC not required for submission to the FBI)

    • e-file Summary Page with EFIN and Application Status highlighted (if applicable)

    • Copy of the e-file Summary page if the Authorized Representative is a principal or responsible official on a different active/completed efile application to support why a background investigation is not required. Highlight the name of the Authorized Representative in yellow.

    • e-file EFIN Status page reflecting return history (if applicable)

    • INOLES printout of the EIN

    • Envelope application was received in

    • Copy of the rejection letter (if appropriate) with a copy of IAT or IDRS page supporting the rejection.

  4. Behind the assembled IPS packet, paperclip the following:

    • RTS printout of the application

    • Copy of the Comments screen(s)

    • All BMF research (IAT, BMFOLE, TRDBV, TXMODA, etc.) paper clipped together

    • All IMF research (IAT, INOLES, IMFOL, TXMODA, TRDBV, DDBOL, etc.) paper clipped together by each Authorized Representative

3.21.264.4.5.3  (06-13-2012)
Rejected Application Documentation

  1. For applications being rejected or applications being returned as incomplete that also have suitability check failures, staple the following documents together in the packet being sent to the applicant:

    • Appropriate letter

    • Form 13551 (To preclude confusion if the Form 13551 is subsequently returned, delete the Batch Control number and all IRS received date notations/stamps with either a single line or "x" in red ink).

    • Training completion statement

    • Proof of professional status (if applicable) and all other documents received with the application

      Exception:

      do NOT staple FPC with other documents

  2. Except for applications being returned as incomplete that also reflect a suitability failure, assemble a copy of the rejection packets for the IPS by stapling the following documents together:

    • Profile Sheet notated with the reason for rejection, signed by the assistor and annotated with their SEID and date

    • Copy of Form 13551

    • Copy of signed rejection letter

    • e-file Summary Page with EFIN and Application Status highlighted (if applicable)

    • e-file EFIN Status page reflecting return history (if applicable)

    • Copy of IAT or IDRS page supporting rejection letter(s)

    • Copy of any correspondence from the applicant

      Note:

      Do not include copies of any training certification statements, proof of professional status or FPC in the IPS packet.

  3. Behind the assembled packets recommending failure; paperclip the following:

    • RTS printout of the application

    • Copy of the Comments screen(s)

    • All BMF research (IAT, BMFOLE, TRDBV, TXMODA, etc.) paper clipped together

    • For individual tax compliance failures, all IMF research (IAT, INOLES, IMFOL, TXMODA, TRDBV, DDBOL, etc.) paper clipped together by each Authorized Representative.

      Note:

      Classify the envelope in which the application was received.

3.21.264.4.5.4  (03-02-2012)
Amended Application Documentation (New Location or Miscellaneous Change)

  1. For amended applications adding a new location or for a miscellaneous change, staple together:

    • Profile Sheet notated with the reason for amendment, signed by the assistor and annotated with their SEID and date

    • Form 13551

    • All other document(s) received with the application (including any FPC)

    • Envelope in which the application was received

3.21.264.4.6  (08-08-2012)
Correspondence

  1. Applications that are missing documents or are incomplete or are rejected for a tax compliance failure will be returned using a cover letter.

  2. Assistors will prepare letters that are professional in appearance.

  3. Letters that consist of two (or more) pages will include at least one paragraph on the second (or subsequent) page.

  4. Assistor will indicate their SEID on each letter they originate.

  5. If necessary, assistors may modify a letter to cover a discrepancy not reflected on one of the letters in Exhibits 3.21.264-10 to 3.21.264-19. If modified, assistors will ensure the letter reflects proper grammar and spelling.

  6. Letters created by an assistor will be undated. The e-help Desk clerk will date stamp the letter when dispatched.

  7. Assistors will stamp the letter with the appropriate signature stamp.

  8. Indicated in the table below is a list of letters used to communicate with a representative about their application and the corresponding IRM reference and Exhibit number:

    Type Correspondence Letter # IRM Reference Exhibit Catalog #
    Incomplete Application Letter 4963 3.21.264.4.6.1 3.21.264-10 and 3.21.264-11 59511E
    Failure to Respond Within 30 Days or Provide Missing Information 4956 3.21.264.4.6.2 3.21.264-12 59503E
    Application received Outside of Open Season Window 4964 3.21.264.4.6.3 3.21.264-14 59512P
    Application Received Outside of Renewal Window 4965 3.21.264.4.6.4 3.21.264-15 59513A
    Business Tax Compliance Failure (Owner) 4961 3.21.264.4.6.5 3.21.264–13 59509S
    Individual Suitability Failure (Owner) 4959 3.21.264.4.6.7 3.21.264-16 59507W
    Individual Suitability Failure (Individual) 4958 3.21.264.4.6.8 3.21.264-17 59505A
    Previous Rejection or Termination 4960 3.21.264.4.6.9 3.21.264-18 59508H
    Rejected Fingerprint Cards (FPC) 4954 3.21.264.4.6.10 3.21.264-19 59500X

  9. Except as indicated below, any correspondence will be addressed to the principal, partner or owner indicated on Line 20 of the Form 13551.

    • Applications being rejected for a business tax compliance failure will be addressed to the principal, partner or owner indicated on Line 20 of the Form 13551 provided the title is reflected in Exhibit 3.21.264-33, Acceptable Titles for Principal, Partner or Owner on Form 13551, as being authorized to receive a business tax compliance failure letter. If not, address the letter to the position in the organization as indicated in the Exhibit.

    • Individual suitability failures will only be addressed to that individual. See IRM 3.21.264.4.6.8 (Individual Suitability Failure). A letter will also be sent to the principal, partner or owner. See IRM 3.21.264.4.6.7, (Individual Suitability Failure (Owner).

    • If an application is being returned as incomplete but one of the Authorized Representatives (other than the owner) failed their individual suitability check, the incomplete letter will be addressed to the principal, partner or owner and indicate that one or more of the authorized representatives listed on the application failed their suitability check. However, do not include the name of the individual that failed the check nor the specific reason for the failure. A separate letter will be sent to the individual that failed their check.

3.21.264.4.6.1  (08-08-2012)
Incomplete Application Letter

  1. Letter 4963, Exhibit 3.21.264-10, Incomplete Application Letter, is used to return an application that is incomplete or missing information.

  2. A list of various reasons for returning the application is at Exhibit 3.21.264-11, Incomplete Application Variable Responses. Reasons may be added or modified as necessary to fit the reason the application is being returned.

  3. If FPC are needed, include 2 blank cards with the appropriate instructions for each applicant requiring a background investigation check.

  4. If appropriate, include paragraphs indicating any business tax compliance check failures. If one or more of the authorized representatives failed their suitability check, include a statement to that affect. However, do not include the name of any authorized representative that failed nor the specific reason for the suitability failure.

3.21.264.4.6.2  (08-08-2012)
Failure to Respond Within 30 Days or Provide Missing Information

  1. Except for amended applications, if an application was previously returned for missing documentation or incomplete information and the response is not received within 30 days of the date of the incomplete letter or by the end of the open season or renewal window, the application will be rejected and returned to the applicant. Letter 4956 (Exhibit 3.21.264-12) will be used to return an application. Use this letter also to return applications received within 30 days but the applicant failed to provide the requested missing information or if they did not resolve a suitability/tax compliance issue. Include in the rejection letter the date of the next open season window when they can submit another application.

    Note:

    Amended applications returned as incomplete or with tax compliance issues will be processed whenever a response is received. If the issue is still unresolved, process the application as a "Pass" but notate on the Profile Sheet the issue remains unresolved. The IPS will address the issue when they can receive the application.

  2. If the application is entered in RTS:

    • Add a Comment to indicate the postmark/IRS received date (whichever is earlier), the missing or incomplete information that was not received within 30 days and the date the applicant can reapply (i.e., May 1st of the next open season).

  3. Assemble the rejected packet as indicated in IRM 3.21.264.4.5.3, Rejected Application Documentation. If the application was not entered in RTS, manually prepare a Profile Sheet. See Exhibit 3.21.264-26, Acceptance Agent Suitability Profile Sheet.

  4. Place the application folder and rejection letter on the REJECT shelf by the latest bundle number.

  5. A Lead will review the packet and (if entered in RTS):

    • Update RTS status "REJECTED"

    • Input appropriate comment such as "Rejected-failure to respond within 30 days" or "Rejected-failed to provide missing information in response" .

    • Put the original rejection letter and packet in the basket for mailing by an e-help Desk clerk.

3.21.264.4.6.3  (08-08-2012)
Application Received Outside of Open Season Window

  1. If an application is received outside the open season window, it will be returned to the applicant. Use Letter 4964, Exhibit 3.21.264-14, Application Received Outside of Open Season window to return an application.

  2. Prior to returning the application, review it for completeness or missing documents. If information is incomplete or missing, include the paragraph reflecting the incomplete or missing item using the reasons in Exhibit 3.21.264-11, Incomplete Application Variable Responses or appropriate comment(s).

  3. Place the application folder and rejection letter in the "INCOMPLETE" basket for mailing by an e-help Desk clerk.

3.21.264.4.6.4  (08-08-2012)
Application Received Outside of Renewal Window

  1. If an application is received outside the renewal window and will not be processed as an amended application , it will be returned to the applicant. Use Letter 4965, Exhibit 3.21.264-15, Application Received Outside of Renewal Window. Include the date in the third paragraph when the applicant can reapply based on current agreement’s expiration date.

  2. Before returning the application, review it for completeness or missing documents. If information is incomplete or missing, include the paragraph reflecting the incomplete or missing item using the reasons in Exhibit 3.21.264-11, Incomplete Application Variable Responses or appropriate comments(s).

  3. Access the application in RTS and enter an "Other" comment that a renewal application was received outside of the renewal window and returned to the applicant.

  4. Place the application folder and letter in the "INCOMPLETE" basket for mailing by an e-help Desk clerk.

3.21.264.4.6.5  (08-08-2012)
Business Tax Compliance Failure (Owner)

  1. Notify the business owner their application was rejected because of business tax and/or individual (if owner is the sole authorized representative) tax compliance issue using Letter 4961, Exhibit 3.21.264-13, Tax Compliance Failure (Owner)

  2. Update RTS:

    • Add a Comment to indicate the balance due (BAL DUE) or missing return(s)

    • If not already changed, update the status of application to "F1 - Failed IRS Tax Compliance Check"

    • Enter date of tax compliance check

  3. Place the application folder and rejection letter on the "REJECT " shelf by the latest bundle number

  4. The Lead will:

    • Review the packet

    • Update RTS: Comments with "Rejected-BMF compliance check failure"

    • Update status to "REJECTED"

    • Put the original rejection letter and packet in the basket for mailing by an e-help Desk clerk.

3.21.264.4.6.6  (07-06-2012)
Failure to Resolve Tax Compliance Issue

  1. If an application is received that was previously rejected for a tax compliance issue, research IDRS to determine if issue has been resolved and posted to master file. If it has not and the resubmitted application does not include a copy of the missing return(s), an IRS notice indicating they were not liable for them or a statement from the owner that they contacted the Business and Specialty Customer Service office and were informed they were not liable, reject the application using Letter 4956, (Exhibit 3.21.264–12), Failure to Respond Within 30 Days or Provide Missing Information. Include in the rejection letter the date of the next open season window when they can submit another application.

  2. See IRM 3.21.264.4.6.2, Failure to Respond within 30 days or Provide Missing Information).

3.21.264.4.6.7  (08-08-2012)
Individual Suitability Failure (Owner)

  1. If the Form 13551 was signed by the owner, partner or corporate officer who is not the authorized representative who failed their tax compliance check, use Letter 4959, Exhibit 3.21.264-16, , Individual Suitability Failure (Owner), to notify the business owner their application (or an individual on the application) was rejected because of an individual tax compliance or other suitability issue.

  2. Do not disclose the name of the authorized representative(s) failed the suitability nor the reason to the owner.

3.21.264.4.6.8  (08-20-2012)
Individual Suitability Failure (Individual)

  1. Letter 4958 Exhibit 3.21.264-17, Individual Suitability Failure (Individual), will be used to notify the authorized representative they cannot participate in the Acceptance Agent program because of an individual tax compliance failure, or the citizenship or date of birth on the application does not match IRS records, or they reside in the U.S. but do not have an SSN..

  2. Mail letters concerning individual suitability issues only to the taxpayer with the issues using their home address indicated on the Form 13551.

3.21.264.4.6.9  (08-20-2012)
Previous Rejection or Termination

  1. Use Letter 4960 Exhibit 3.21.264-18, Previous Rejection or Termination, for an application previously rejected or received from an EIN whose agreement was terminated by the IPS and the eligibility date has not expired.

  2. If appropriate, include date applicant can reapply (i.e., May 1st of the next open season).

  3. Enter a comment in RTS that another application was received but returned because the eligibility period had not expired.

3.21.264.4.6.10  (08-08-2012)
Rejected Finger Print Cards (FPC)

  1. If the FPC for an authorized representative cannot be processed by the FBI and there is not a second FPC in the folder, return the application and rejected FPC using Letter 4954, Exhibit 3.21.264-19, Rejected Finger Print Cards (FPC).

3.21.264.4.6.11  (03-02-2012)
Request for Name Check

  1. Use the form in Exhibit 3.21.264-9, Request for Name Check and Fax Cover Sheet, to request a manual name check for an authorized representative after the second unsuccessful attempt to process their FPC.

3.21.264.4.7  (01-01-2012)
Quality Review

  1. Team Leads and designated assistors will:

    1. Perform random quality checks of applications processed by an assistor using the Review Form in Exhibit 3.21.264-20, Form 13551 Review Checklist.

    2. The results of the quality review process by the Leads/designated assistors are used to identify areas needing additional emphasis, training or clarification

    3. Review at least one application for Embedded Quality Review System (EQRS) purposes monthly. These reviews are considered during the assistor’s annual performance evaluation.

  2. A review by a Lead/designated individual includes (but is not limited to):

    • Whether the assistor identified all incomplete or missing information or documents when the application was initially reviewed

    • Accuracy of RTS entry

    • Compliance with this IRM

  3. The following items are critical to the ITIN acceptance agent program:

    • EIN

    • Authorized representative name

    • Mailing address

    • Background check requirement

    • Title in Item 20 must be appropriate for EIN in Item 4

    • Signature

3.21.264.5  (01-01-2011)
Acceptance Agent Approval Process (For ITIN Policy Section Use Only)

  1. The following sections describe the process for Acceptance Agent Approval.

  2. The Acceptance Agent applications are submitted to the ITIN Policy Section after Austin e-help Desk employees process and enter the application in the ITIN Real-time System (ITIN RTS). The ITIN Policy Section is responsible for analyzing the applications and determining the final disposition.

3.21.264.5.1  (01-01-2011)
Clerical Process

  1. The ITIN Policy Section Clerk will verify the receipt of application from Austin e-help Desk against the Document Transmittal (Form 3210) and take the following actions.

    If ... Then ...
    An application is received that is not listed on Form 3210, Record the application on Form 3210 in the same order of applications received.
    An application was listed on Form 3210, but not received, Write “Did not Receive” on Form 3210.

  2. The clerk will then acknowledge receipt of Form 3210 (sign), return part 3 to the originating office, and maintain a copy for six months.

  3. Each application is counted and entered into the inventory database.

  4. Applications are checked for completeness and rejection criteria. The table below outlines appropriate actions:

    If ... Then ...
    The application is not complete, The clerk will notify the analyst for review to determine action to be taken.
    The application meets rejection criteria, IRM 3.21.264.5.4 The application will be removed from the new applications and worked with the rejected applications.
    The application has FBI data, The application will be given to the Senior Analyst to determine if the application will be rejected or continue in the process.

  5. A folder is made for each application with the legal name on the folder. The folder includes:

    • A Chronology Sheet to record action taken on the application,

    • A print from the Integrated Data Retrieval System (IDRS) of CC INOLET to ensure the information on Master File is the same as the information on the application,

    • The application with profile sheet, tax compliance and FBI results,

    • The preliminary agreement. Two copies will be printed one to be sent to the applicant and the other will remain in the file,

      Note:

      There are two types of agreements – AA and CAA. The type of agreement sent to the applicant for review is determined by the applicant type applied for on Form 13551.

    • The agreement letter that is sent to the applicant along with the preliminary agreement and signature pages. The letter notifies the applicant to review the agreement and sign and return two signature pages to the ITIN Policy Section at the address provided for final approval.

  6. Data from the application is entered into the Agreement List database. Database is used to merge correspondence letters.

  7. Folders are placed in the cabinet for analyst review and mailing. The folders are then returned to the clerk for database update and storage.

  8. The agreement list is updated to reflect the date the analyst mailed the agreement letter and draft agreement to the applicant.

  9. The folders are stored in the file cabinet in alphabetical order awaiting applicant response.

  10. The applicant should mail the signature pages to the IRS within 45 days of the date of the letter. The clerk will check the mailing dates on the agreement list. If the signature pages have not been returned within the 45 day from the date the correspondence was mailed, the folder will be removed from the file cabinet and treated as a rejected application.

  11. Only original signature pages are acceptable to finalize an agreement. When signature pages are received, they will be associated with the appropriate file. If improperly signed, another agreement with signature pages will be sent to the applicant requesting an official and proper signature. If the signature pages are signed appropriately, the clerk will organize the applicant file with the following documents for the analyst to review:

    • Two copies of the final agreement with the signature page on top of agreement,

    • Certificate of Accuracy (COA) – Applies to CAA only,

    • CAA handout (document codes and designate telephone listing,

    • Document Codes - Applies to AA only,

    • Congratulations letter,

    • Envelope addressed to the applicant.

  12. The application is added to the finalized list and placed in the file cabinet for analyst review. The clerk will mail a copy of the agreement (analyst will place all required documents in the envelope to be mailed) and file the approved agreement in the appropriate cabinet in alphabetical order. The agent’s name, EIN and office Code will be added to the approved list.

  13. Rejection criteria include(s), but not limited to:

    • Failed tax compliance check,

    • Failed FBI background investigation,

    • Applicant has an ITIN and resides within the U.S.,

    • Applicant did not return signature pages within 45 days,

    • Organization business operations is outside the scope for the AA program.

  14. Austin e-help Desk employees will send rejection letters to applicants who:

    • Fail the tax compliance check, and

    • have an ITIN and reside in the U.S.

  15. Applications failing the tax compliance check will be forwarded with a copy of the rejection letter to the ITIN Policy Section by overnight delivery. Applications will be maintained for 30 days after the end of the open season. After 30 days, applications will be discarded as classified waste.

  16. Applications failing the FBI Background Check will be mailed to the ITIN Policy Section for final determination. The clerk will follow the receipt process and then give the application(s) to the assigned analyst for final determination. The clerk will take the following actions:

    If ... Then ...
    The analyst determines the application should be allowed to continue in the process, The application will follow the normal receipt process.
    The analyst determines the application is unacceptable and should not be allowed to continue in the process, The application will be rejected and clerk will follow reject procedures. All reject applications will be placed on the reject and/or failed list.

3.21.264.5.1.1  (01-01-2011)
Clerical Actions for Amended Form 13551

  1. AA/CAAs must complete and submit an amended Form 13551 by official mail to Austin e-help Desk address in the application instructions to make changes to the originally submitted application. A change is considered any of the following:

    • Change in business or mailing address

    • Change in authorized representatives

    • Change contact telephone number and E-mail address

    • Change the primary and/or alternate contacts

  2. Requested changes will be made within 30 days of receipt from the Austin e-help Desk employees. The clerk will assign amendments to the analysts. The analysts will determine the appropriate action to take, annotate the chronology of changes and E-mail the AA confirming the date changes were completed. Once completed the file will be returned to the clerk to re-file in the appropriate cabinet.

3.21.264.5.1.2  (01-01-2011)
Clerical Actions for Terminated Agreements

  1. All terminated agreements will be input into the terminated list database by the clerk.

  2. Agreements may be terminated for, but not limited to, the following reasons:

    • Request by the entity

    • Expired Agreement

    • Compliance Review Infractions

    • Quality Review Infractions

    • Inactivity

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡


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