TC 130 is an entity transaction on CC ENMOD and will display the cross reference information and the campus (literal = SC>) that input the freeze.

The Treasury Offset Program (TOP) allows credits to be applied against delinquent child support obligations, non-tax debts owed to other Federal agencies, State income tax obligations and unemployment compensation debt. TOP TC 130s are systemically engaged and released by the agencies requesting these freezes. Refer to IRM 21.4.6, Refund Offset.

If a credit of ≡ ≡ ≡ ≡ ≡ or more becomes available, a CP 44 (IMF) or CP 188 (BMF) is generated to that campus.

On CC TXMOD the presence of a TC 130 can be identified by freeze code "V—" .

Requests for input of TC 130 may be received on the following:

Examine the request to ensure that the following information is given for each debit (balance due) account:

If the information is incorrect or incomplete, you must contact the originator to secure the correct information, or return the request for completion.

Consider input of TC 130 to the IMF when:

Consider input of TC 130 to the BMF when:

To input a TC 130 on CC ENMOD, use CC REQ77 and input the following:

If block 6b on Form 53, Report of Currently Not Collectible Taxes is checked "yes" , input the closing code of the TC 530, BMF name control, and cross-reference EIN.

One of the following Document Locator Number Indicators should be input::

If the request lists more than one partner on the BMF account, input a TC 130 to each individual entity module.

After input, destroy the document. Retention of paper files is no longer required.

At the time a Non-Master File assessment is made, ANMF will not systemically post the TC 130 to master file. Manual input of TC 130 is still a requirement.

The Automated Trust Fund Recovery System will generate a Form 3177,Notice of Action for Entry on Master File, to hold any refunds prior to the assessment posting on the taxpayer's account. Additional information will include the EIN of the corporation as cross-reference and the TC 130 DLN indicator will be "102" .

Taxpayers may agree to assessments made by the Underreporter and Examination functions by requesting that their anticipated refund be applied to the assessment. Underreporter and Examination requests input of TC 130 on these accounts by forwarding a copy of the taxpayer's request to WI CSCO for IMF cases and SB/SE CSCO for BMF cases.

DLN indicator "004" should be used. If the amount held does not fully satisfy the assessment, apply all available credit and input a TC 131. Any future refunds will automatically offset to the liability.

Research for any outstanding liabilities on IDRS.

When a TC 130 is input, it will generate a V— freeze code for the account. When a refund at or above ≡ ≡ ≡ ≡ ≡ ≡ becomes available it is frozen. A notice, Delay in Processing Your Refund, is mailed to the taxpayer, and at the same time a CP 44 for IMF or a CP 188 for BMF will generate to WI CSCO and SB/SE CSCO respectively.

Work the CP 44/188 as follows:

If the X-REF TIN associated with the TC 130 on CC ENMOD is an EIN or a pending TFRP assessment is indicated, research AMS history on the TC 130 SSN and spouse SSN for the presence of history regarding Trust Fund Recovery Penalty.

Exercise caution to ensure that there is a basis for offsetting credits. A credit from an entity with an individual filing requirement cannot be offset to an entity with non-individual filing requirements.

If the credit cannot be legally offset, input TC 131 to release it.

If the cross reference TIN's module has a posted TC 608, the Collection Expiration Statute Date has expired and the balance will be ".00" .

Installment privileges for Form 1041, U.S. Fiduciary Income Tax Return (for Estates and Trusts), is automatically set up by the computer when the taxpayer files the tax return by the due date and pays one-fourth of the balance due. Input TC 131 if the following conditions apply:

Under the authority of IRC § 6402 (a), the entire credit on a joint return may be tentatively applied to one spouse's balance due if no statement is received from the taxpayer on the allocation of the credits:

The following If/Then Chart provides procedures on how to process accounts with certain freeze codes.

Prior to moving your credit, look for a Large/Corporation case indicator. If the indicator is present, contact the Technical Unit for instructions.

When transferring credits, refer to Exhibit 21.5.8–1, Transaction Codes and Reversals.

If the credit can be transferred on IDRS, use CC ADD24 or ADC24.

Form 2424, Account Adjustment Voucher, must be prepared to transfer a credit to a NMF account:

The chart below provides procedures for application of credits when there are one or more debit modules.

When there is more than one debit module, and the available credit will exceed the total debit:

If allowable interest is to be transferred, use TC 850 (Dr) and TC 770 (Cr).

If a liability remains after application of the available credit, close the control base, if applicable.

If the available credit is being transferred to an account with a TC 530 cc 03, change the address to the address shown on the CP 44, if different.

Count as follows:

The following chart will provide an explanation for each miscellaneous code. SBSE should identify the "fixed and determined" from this point forward. Any module that does not have a code will be verified through the revenue officer or case processing.

The following transcripts are considered as a Priority Transcript: CSED, PMTEXPCSED, CP 44, NMFL, AM07W and any transcript with a "credit balance/TC 608."

Any module that has a TC 520 (—V. —W or —VW) will not be routed. If there is a TC 470 on the module, input TC 472. Close the control with a history item relating to the action.

Research IDRS for any available credit(s). Your search should include CC URINQ, XSINQ, and UPTIN. Document AMS with a history item XXXXXRSHRD (X's identifies the type of transcript).

To transfer credit(s) to the Unidentified Remittance File or Excess Collection File, follow the procedures below.

To request a transfer from Excess Collection File, follow the procedures below.

To request a manual refund, use Form 5792, Request for IDRS Generated Refund (IGR). Refer to IRM 21.4.4.4.1, Preparation of Form 5792, IDRS Generated Refund.

Approval is necessary for a) and not b).

If there is an expired CSED module, credits are located and the TC 608 is significant, and the date of the payment is prior to the posted CSED (not the TC 608 date), the credit should be transferred to the expired CSED module.

As of January 1, 2000, statute expired (STEX) IMF Credits (TC 806, credit for Withholding Tax and Excess FICA, and TC 768 Earned Income Tax Credit only) are systemically transferred weekly from the Individual Master File to the XSF.

If balance due notice or TDA processing is suspended for more than six months due to an IRS error, adjust any penalty and interest per procedures in IRM 20.1.2, Failure to File/Failure to Pay Penalties and IRM 20.2, Interest.

If there is a TC 582 Federal Tax Lien on the module, verify the CSED. If the CSED is within 180 days of expiring, resolve any retention or freeze code. When the CSED expires, the lien is self-releasing.

Count each transcript received for each different MFT/TXPD, except where noted.

A Payment Expired CSED (PMTEXPCSED) Transcript generates once for each TC 610, TC 640 or TC 670, without DPC 05, 06, or 14, that is applied to a module after the CSED has expired. Compute interest on all refunds over 30 days old. In January 2005, all issues relating to DPC 05 and 99 generated to ACS Support as a LEVYPMT Transcript. In cycle 200618 DPC 99 returned to the PMTEXPCSED Transcript.

WI CSCO works IMF accounts and SB/SE works BMF accounts.

The 06W transcript will generate after twenty-two (22) cycles, when there is an unresolved TC 470 with no Closing Code (cc), a cc 90, cc 93 or cc 95 on IDRS. A -W freeze appears on the transcript and the tax module on IDRS. The issuance of the transcript is categorized as AMRH. If the first 06W transcript is not resolved, a follow-up transcript will issue in 15 cycles and can be identified by an "F" after the transcript type. Most of the 06W transcripts generated will not relate to Collection cases because other functions use the TC 470.

If the Assessment Statute Expiration Date (ASED) has expired, an AM-X transcript will generate regardless of any posting in a module.

If the return statute is imminent (within 180 days period), a STAT transcript will generate.

All AM06 transcripts will be processed following procedures below. If the transcript cannot be resolved within 14 days from the computer notice date, input your control on IDRS.

WI CSCO works IMF accounts and SB/SE works BMF accounts.

The AM07 transcript generates when there is a credit balance on an account that contains a TC 130 and TC 150 and the CP 44 Notice was not resolved in 16 cycles. A V— freeze appears on the transcript and the related module on IDRS. If the transcript is not resolved within 14 days from the computer notice date, a control base with category code AMRH is automatically established.

The following will explain the three statute transcripts that will generate for the 07 if the module is open, regardless of any posting:

WI CSCO works IMF accounts and SB/SE works BMF accounts.

The Collection Statute Expiration Date (CSED), is the date the statute expires for collection of tax, penalty or interest. The CSED is ten (10) years from the assessment date (23C date) of the posting of the original return (TC 150). The CSED can be extended by circumstances, including but not limited to litigation, an OIC filing, the filing of an innocent spouse claim, or by the taxpayer residing outside of the U.S. The following chart lists each transaction that carries its own CSED.

Figure 5.19.10-7

A CSED Transcript generates when the earliest CSED is expired, the latest is not expired and there is no unreversed TC 534 or a TC 400 Hold present, for each debit module with a total module balance of ≡ ≡ ≡ or more on the account. An A— freeze appears on the credit and debit module. It freezes the account for eight cycles or until a TC 534 is input, whichever is earlier. A CSED Transcript may generate even if the balance due is for accruals of penalty and interest only.

If the CSED expired prior to 11/5/1990, the CSED was 6 years. If the CSED had not expired as of 11/5/1990, it was extended to 10 years.

See IRM 25.6.1.12, Collection Statute Expiration Date (CSED).

To determine the CSED, extension of the CSED, and penalty and interest you may need to refer to IRC § 6502Collection After Assessment and the following IRMs:

WI CSCO works IMF accounts and SB/SE works BMF accounts.

The AM 23W transcript is generated to alert the campus of the W— freeze condition created by a TC 470 cc 90, 93, or 95 and the tax module is within 180 days of the Collection Statute Expiration Date (CSED).

WI CSCO works IMF accounts and SB/SE works BMF accounts.

The CP 86/186 Notice generates when:

Collection Operations will only work collection related issues, all others should be routed to the appropriate operation.

Conditions which create restrictions are:

Verify the appropriate disaster declaration by accessing the Disaster Declarations/FEMA at http://www.tris.irs.gov/fema/.

WI CSCO works IMF accounts and SB/SE works BMF accounts.

The Non-Master File Liability (NMFL) transcripts are generated by Enterprise Computing Center at Martinsburg (ECC-MTB) when a second credit posts to a module after issuance of a CP 44 Notice and the V— freeze created by the TC 130 remains on the taxpayer’s account. When a TC 740 posts to the transcript module and creates a credit balance, the NMFL transcript will generate.

A Duplicate Refund Transcript will generate weekly to the Manual Refund Operation if a TC 840 posts to an account and there is a previous TC 840 or TC 846 posted. These transcripts will be reassigned to the originator of the duplicate refund.

If the case resulted in an erroneous refund, refer to IRM 21.4.5, Erroneous Refunds, for procedures.

A VERFPYMT Transcript generates when a payment posts to a debit balance module, resulting in a credit balance of ≡ ≡ ≡ ≡ ≡ ≡ . Verify Payment (VERFPYMT) Transcripts. The VERFPYMT Transcripts are generated on a weekly basis. The transcripts are forwarded to the appropriate AMRH Unit. AMRH will sort and forward any transcript relating to Collections to the campus.

A NOMRG Transcript with Reason Code NM07 will generate when both accounts being merged contain the following conditions within the same tax period: both accounts are in TDA/TDI (22, 24, 26) status and the Location Codes (Primary or Secondary) do not agree.

The "TO" account is in a TDI Status and the "FROM" account has TDA modules for which there are no modules for same MFT/TXPD in the taxpayer's account.

In order to merge two related accounts, both BOD Codes must match.

The "no merge" is a result of the revalidation of the SSN. A complete transcript of both the "FROM" and "TO" accounts will generate when the "FROM" account contains a Civil Penalty Name Line and the name control of the Civil Penalty Name Line does not match the "TO" account name control. This is a No-merge Reason Code 19.

The CP 206 (Form 4179) Notice of No Merge TDA Module generates on the BMF accounts and the NOMRG TDA transcripts (Form 403) generates on the IMF accounts. An attempt is made to consolidate two separate accounts when the following conditions exist:

IRC 112 excludes from gross income certain pay an enlisted military member, warrant officer, or a commissioned warrant officer of the Armed Forces receives for active service:

For commissioned officers, the amount of pay excluded is limited to the maximum enlisted amount per month, plus imminent danger/hostile fire pay. For additional information, see Pub 3.

The exclusion from gross income is effective from the date of the combat zone designation until the area is no longer designated as a combat zone.

Certain members of the Armed Forces outside the designated combat zone can qualify for the combat zone exclusion of the income. To qualify, they must:

The exclusion for both enlisted personnel and commissioned officers is reflected on a Form W-2, Wage and Tax Statement, prepared by the military member’s assigned Finance and Accounting Office.

The Department of Defense determines who serves in direct support of the designated combat zone military operation and issues Form W-2 correctly reflecting taxable income.