5.19.11  Withholding Compliance Program (Cont. 1)

5.19.11.7 
Responses and Redeterminations

5.19.11.7.1  (12-31-2010)
Modify Lock-in

  1. Taxpayers may call in or send the Service additional information and request that we reconsider our proposed or previous lock-in determination.

  2. Be alert for special situations. Research IDRS for freeze codes associated with Outcome 3 cases. Follow instructions contained therein.

  3. In many instances the taxpayer's correspondence will contain a new Form W-4, Employee’s Withholding Allowance Certificate and completed worksheet.

    1. Review the Form W-4, Employee’s Withholding Allowance Certificate and worksheet for accuracy. DO NOT take any action based on an invalid Form W-4, Employee’s Withholding Allowance Certificate. See IRM 5.19.11.3.5., Invalid Form W-4.

    2. If the taxpayer did not submit a Form W-4 worksheet, prepare one based on current taxpayer information confirmed by taxpayer communication and/or your research. Use judgement in determining credibility and the need for verification. Follow guidelines in See IRM 5.19.11.7.1.2, Calculating Withholding Allowances for calculating withholding allowances.

    Reminder:

    Base the withholding allowance calculation on the taxpayer's current situation. For example, if the taxpayer's most recently filed return showed itemized deductions of $50,000 confirm with the taxpayer that he or she projects the same amount for the current year before using this amount for the withholding calculation.

  4. If the taxpayer calls, complete the worksheet while the taxpayer is on the telephone. Try to resolve the entire case by phone. Oral testimony is acceptable. Use judgement in determining credibility and the need for verification.

  5. If the taxpayer response states that he/she furnished a new Form W-4 to his/her employer, work the response as a redetermination.

  6. When verification is required on Personal Allowances worksheet items, attempt to validate the information from internal sources before contacting the taxpayer.

  7. When verification is required on Deductions and Adjustments worksheet items or Converting Credits to Withholding Allowances worksheet, allow only those amounts that can verified on the most recent return due, including RTVUE/TRDBV for returns in processing; or the immediate prior year return when the most recent return due is not available.

    Reminder:

    An Automated Substitute for Return (ASFR) return is not considered to be a return for verification purposes.

  8. When working correspondence, check the most recent IRPTR and WHCS to identify all current employers. When talking to the taxpayer on the telephone ask him or her for the names and addresses of all current employers.

    1. If not already listed, add these employers to WHCS and document the AMS history.

    2. If the taxpayer says that he no longer works for an employer listed on the most current IRPTR, document the AMS history.

5.19.11.7.1.1  (03-15-2012)
Information Required to Modify Lock-in

  1. If the taxpayer has not filed the most recent return due or the information he or she provides does not match return or internal source information, the taxpayer must provide documentation, as applicable, to support the request for modification. See the table below for required documentation:

    If the taxpayer and then request
    Is married and previously filed "Single" status   spouse's SSN and current year filing status
    Can supply SSN(s) of all dependent(s) he or she wants us to consider when computing his or her withholding allowances the SSN(s) can be verified through internal sources no further action is necessary
    Has not supplied the SSN(s) of any dependent(s) he or she wants us to consider when computing his or her withholding allowances we are unable to verify SSN(s) and dependent status through internal sources copies of birth certificate(s) and social security card(s)

  2. The following deductions and adjustments must be verified by the most recent return due, including RTVUE/TRDBV for returns in processing; or the immediate prior year return when the most recent return due is not available.:

    • Child or dependent care expenses

    • Schedule A deductions (including home mortgage interest, charitable contributions, real estate, state and local taxes, medical and miscellaneous expenses)

    • Adjustments which decrease adjusted gross income such as alimony payments, student loan interest and Individual Retirement Account (IRA) contributions

  3. If the correspondence is insufficient to complete the worksheet, contact the taxpayer by telephone to secure the missing information.

  4. If you are unable to talk to the taxpayer and resolve the issue, send Letter 4243C requesting the required information. Give the taxpayer a two week deadline to respond.

  5. Document AMS with the deadline set and specific information requested to complete the redetermination. When the taxpayer responds, any tax examiner can then complete the case.

5.19.11.7.1.2  (12-31-2010)
Calculating Withholding Allowances

  1. The Form W-4 worksheet and, if required, the worksheets and tables in Publication 505, Tax Withholding and Estimated Tax, will be used to figure the correct status and number of withholding allowances for the taxpayer.

  2. Secure the information necessary to complete the worksheets from the taxpayer or their authorized representative.

    1. If working correspondence and the information submitted by the taxpayer is insufficient to figure the correct number of withholding allowances, contact the taxpayer or their authorized representative by telephone to obtain the additional information. Make at least two attempts to reach the taxpayer by telephone at different times of day before initiating correspondence.

    2. If you are speaking to the taxpayer, complete the worksheet at that time. It is not necessary for the taxpayer to submit the form in writing.

    3. If the taxpayer is current in filing, compare the taxpayer's information regarding marital status, dependents, income, deductions and credits to the last return filed, using Corporate Files On-Line (CFOL) command codes RTVUE and IRPTR. Discuss and resolve any significant discrepancies with the taxpayer. Document the explanation in the history.

    4. If the taxpayer is a nonfiler, explain to him/her that submission of the tax return will provide sufficient verification.

      Note:

      Ask the taxpayer to file the original return(s) according to the instructions on the Form 1040, U.S. Individual Income Tax Return or any notices he/she has received and fax or mail the Withholding Compliance Unit a copy.

  3. Written verification should be requested as appropriate. Examples are listed below but are not all inclusive.

    1. Current income has decreased more than 20% from the preceding year.

      Example:

      According to IRPTR, the taxpayer had wages of $75,000 last year. The taxpayer tells you his wages have decreased to $55,000. Request a recent pay stub from the taxpayer to verify.

    2. Schedule A expenses have increased more than 20% from the preceding year.

      Example:

      The taxpayer tells you that his mortgage interest expense is currently $18,000 per year. According to IRPTR, the taxpayer paid $10,000 in the preceding year. Request verification of the mortgage interest amount.

    3. Changes in filing status and/or number of dependents.

      Example:

      The taxpayer currently claims a different filing status and/or number of dependents from the preceding year. Verify the filing status of secondary spouse, if applicable. Ask the taxpayer for the SSN's and birth dates of dependents.

      Reminder:

      Child tax credits can only be claimed for dependents under age 17.

  4. APO/FPO addresses may indicate that the taxpayer is either in the military or works for the federal government. If the taxpayer is in the military or works for the federal government, they do not qualify for the foreign earned income or foreign housing exclusion (reported on Form 2555, Foreign Earned Income). If the taxpayer has an APO/FPO address, you must determine if they are in the military or working for the federal government through research or contact.

    1. If you determine that the taxpayer is not in the military or working for the federal government, the Form 2555, Foreign Earned Income can be used for calculating withholding allowances.

    2. If you determine that the taxpayer is in the military or working for the federal government, Form 2555, Foreign Earned Income should not be considered in calculating withholding allowances.

    Note:

    For joint filers, one spouse may qualify while the other does not. The qualifying spouse may complete a separate Form 2555, Foreign Earned Income. Disregard any erroneously filed Forms 2555, Foreign Earned Incomeattached to the return when calculating the number of allowances.

    Example:

    Taxpayer A has an APO address. Research and contact confirms his employer is neither military nor federal government. Taxpayer filed Form 2555, Foreign Earned Income which can be used to calculate appropriate withholding allowances based on current situation.

  5. After calculating the correct number of allowances, inform the taxpayer that we will send his/her employer(s) a letter revising the marital status and number of allowances previously specified in Letter 2800C.

    Note:

    If the taxpayer requests fewer allowances than what was calculated to be the correct number, advise the taxpayer to submit Form W-4, Employee’s Withholding Allowance Certificate claiming the requested number of allowances to his employer. Further advise the taxpayer that our letter(s) instruct the employer to honor the Form W-4, Employee’s Withholding Allowance Certificate if the withholding rate, withholding allowances, and any additional amount claimed on the employee's current Form W-4, Employee’s Withholding Allowance Certificate or a new Form W-4, Employee’s Withholding Allowance Certificate will result in MORE income tax withheld than at the withholding rate and withholding allowances specified in the letter. Offer to send the employer Letter 4074C.

5.19.11.7.1.2.1  (03-15-2012)
Calculating Allowances for Married Taxpayers or Taxpayers with More Than One Job

  1. You must complete the Two-Earner/Two-Jobs Worksheet on the back of the Form W-4, Employee’s Withholding Allowance Certificate if

    1. The taxpayer filed the most recently due return jointly and both spouses work, or

    2. The taxpayer has more than one job, and

    3. The combined earnings from all jobs exceed $40,000 ($10,000 if married).

  2. This worksheet will reduce the number of allowances the taxpayers are otherwise entitled to, in order to avoid having too little tax withheld. The IRS recommends that all the allowances be claimed for the highest paid job and zero allowances be claimed for the other jobs. However, the taxpayers may split the allowances any way they want.

    1. If the taxpayer cannot provide a complete and accurate name of the spouse's employer to enable the tax examiner to find an EIN, advise the taxpayer that until he/she provides the required information, the lock-in will be modified to Married with zero allowances.

    2. AMS documentation should include the basis for the W-4 calculation, the specific information and/or documentation requested of the taxpayer.

  3. AMS documentation should include all information requested from the taxpayer

    Note:

    Do not compute lines 4 through 9 on the Two-Earner/Two Jobs Worksheet since the IRS may not require additional withholding above the amount withheld using the marital status and number of allowances specified in the lock-in letter. However, advise the taxpayers that they may elect to have additional withholding by completing a new Form W-4, Employee’s Withholding Allowance Certificate and giving it to their employer.

  4. Either the taxpayer or spouse may provide the information necessary to calculate the allowances. Under IRC Section 6103(h)(4) you may make disclosures regarding withholding exemptions of a spouse.

  5. After calculating the correct number of allowances, inform the taxpayer that we will send his/her employer(s) a letter revising the marital status and number of allowances previously specified in Letter 2800C.

    1. Issue Letter 2808C to the employer(s) and Letter 2812C to the taxpayer.

    2. Input TC 971 AC 148 with the modified lock-in rate and cross-reference the employer EIN.

    3. Notate your actions on AMS and update WHCS.

    Note:

    If the taxpayer requests fewer allowances than what was calculated to be the correct number, advise the taxpayer that the employer(s) letters instruct them that if the withholding rate, withholding allowances, and any additional amount claimed on the employee's current Form W-4, Employee’s Withholding Allowance Certificate or a new Form W-4, Employee’s Withholding Allowance Certificate will result in MORE income tax withheld than at the withholding rate and withholding allowances specified in the letter, they must honor it. Offer to send the employer the 4074C letter.

  6. Send Letter 2801C to the spouse and Letter 2800C to the spouse's employer(s) to lock in his/her withholding as previously determined. Input TC 971 AC 146 with the lock-in rate and cross-reference the employer EIN. Notate your actions on AMS and update WHCS.

    Note:

    Regulations provide that the earliest the lock-in letter may be effective is 45 calendar days after the date of the letter. Letter 2800C requires that the employer(s) wait 60 days before adjusting the employee's withholding to the marital status and number of allowances specified in Letter 2800C . This time period provides the spouse with an opportunity to dispute our determination before his/her withholding is adjusted. However, if the spouse is agreeable, suggest that he/she submit a new Form W-4 with the status and allowances specified in Letter 2800C immediately.

5.19.11.7.1.2.2  (12-04-2009)
Common Law Marriage

  1. The taxpayer may claim that he or she is common law married. In order to have a valid common law marriage, the taxpayer and common law spouse must

    • Live together for a significant period of time

    • Hold themselves out as a married couple

    • Intend to be married

  2. Not all states permit and/or recognize common law marriage. In order to be common law married, the taxpayers must live in a state where common law marriage is recognized or in the state where the common law marriage began. See IRM 25.15.7.6.6(2), Invalid Joint Election for a list of states where common law marriage is recognized.

  3. If the taxpayer meets all three conditions in (1) above and lives in a state that recognizes common law marriage, ask the taxpayer to provide at least two of the following types of documentation to substantiate a claim of common law marriage.

    • Deeds showing title to property held jointly by both parties to the common law marriage

    • Bank statements and checks showing joint ownership of the accounts

    • Insurance policies naming the other party as beneficiary

    • Birth certificates naming the taxpayer and the common law spouse as parents of their children

    • Employment records listing the common law spouse as an immediate family member

    • School records listing the names of both common law spouses as parents

    • Joint credit card accounts

    • Loan documents, mortgages, and promissory notes evidencing joint financial obligations

    • Mail addressed to the taxpayer and common law spouse as "Mr. and Mrs."

    • Any documents showing that the wife has assumed the surname of her common law husband

  4. If the taxpayer meets the above criteria, treat him or her as married when calculating his or her allowances. See IRM 5.19.11.7.1.2.1, Calculating Allowances for Married Taxpayers or Taxpayers with More Than One Job for married taxpayer procedures.

  5. If the taxpayer does not meet the above criteria, treat him or her as single when calculating his or her allowances.

5.19.11.7.1.3  (02-09-2011)
Procedures for QW-4 Program Cases

  1. When contacted by the taxpayer add the case to WHCS.

  2. See IRM 5.19.11.7.3.1#.(3), #Lock-in Release Requirements for Self-Correcting Taxpayers# for instructions on handling these cases.

  3. Cases where lock-in letters were issued by the QW-4 program will not have a TC 971 AC 146/147 transaction on Master File. You must input a TC 971 AC 146 to IDRS, using the current date on the current year, before inputting a modification or release transaction. It is not necessary to input the TC 971 AC 146 to WHCS, only the subsequent TC 97X AC 14X.

  4. When modifying a QW-4 lock-in, input TC 971 AC 148 with posting delay (1) on the current year to WHCS and IDRS.

  5. Update AMS history.

5.19.11.7.1.4  (03-15-2012)
Processing the Lock-in Modification

  1. If a modification to the lock-in rate is justified, inform both the taxpayer and the employer. Send Letter 2808C to all employers considered in the and Letter 2812C to the taxpayer. If the taxpayer has more than one employer, send separate letters to each.

  2. If the modification will result in no tax withheld from the taxpayer's wages, release the lock-in(s) following normal procedures using WHCS Disposition Code "NSW" . Document AMS that the allowance calculation results in no tax withheld.

    1. Release if Withholding Calculator does not come to .00 and balance due(s) are not a result of under withholding or modification that may result in future under withholding on wages.

    Note:

    Use the Withholding Per Pay Period calculator to compute the amount of tax that will be withheld from the taxpayer's wages.

  3. Input TC 971 AC 148 with the modified lock-in rate to IDRS and update WHCS. Cross-reference the employer's EIN. If the taxpayer has more than one employer, input TC 971 AC 148 with the modified lock-in rate and cross-reference the EIN, for each employer sent a letter.

  4. Ensure that all employers are considered when processing the taxpayer's request. Issue letters as shown in the table below:

    If Then
    Employer has received Letter 2800C previously
    1. Send Letter 2808C to the employer.

    2. Send the taxpayer Letter 2812C using paragraph "D" for multiple employers, if needed.

    3. Input TC 971 AC 148 with employer's EIN and modified lock-in rate to IDRS.

    4. Document the AMS history with the facts and data used to calculate the modified withholding rate.

    5. Update WHCS.

    Employer has not received Letter 2800C previously or received 2800C and responded NLW more than 12 months ago.
    1. Send Letter 2800C to employer with the modified lock-in rate.

    2. Send the taxpayer Letter 2812C instead of Letter 2801C using paragraph "D" for multiple employers.

    3. Conduct research necessary to complete the letters.

    4. Input TC 971 AC 146 with employer's EIN and modified lock-in rate to IDRS.

    5. Document the AMS history with names and EIN's of the additional employers and with the facts and data used to calculate the modified withholding rate.

    6. Add new employer(s) to WHCS and update letters and transaction codes.

  5. If the taxpayer informs you that they have returned to work for an employer who received Letter 2800C and that employer had previously responded that the taxpayer "no longer works" within 12 months of the modification request, take the following actions:

    1. Send Letter 2808C to employer with the modified lock-in rate.

    2. Send the taxpayer Letter 2812C using paragraph "D" for multiple employers.

    3. Research WHCS for the original Letter 2800C transaction date. Input TC 971 AC 146 using the original Letter 2800C transaction date, EIN and Single 00 rate to IDRS. Do not reissue Letter 2800C.

    4. Input TC 971 AC 148, posting delay (1) with employer's EIN, current date and modified lock-in rate to IDRS.

    5. Document the AMS history with names and EIN's of all current employers and with the facts and data used to calculate the modified withholding rate.

    6. Update WHCS with original 2800C letter, transaction date and withholding rate.

    7. Update WHCS with the 2808C letter, transaction code, current transaction date and modification rate.

      Note:

      Regulations require that the employer furnish an employee that is not performing services for the employer as of the date of the notice with the “Employee’s Copy” of the lock in letter if the employer reasonably expects the employee to resume the performance of services for the employer within 12 months of the date of the notice (Lock-in letter).

  6. If the additional information does not justify changing our previous determination, notify only the taxpayer using Letter 2810C. Input TC 971 AC 148 to IDRS with the unmodified lock-in rate. Cross-reference the employer's EIN. Update WHCS. IRM 5.19.11.7.2, No Change.

5.19.11.7.2  (12-04-2009)
No Change

  1. If you determine that the taxpayer's information does not support a change to the marital status and number of allowances

    1. Mail Letter 2810C to the taxpayer

    2. Input TC 971 AC 148 to IDRS with the unchanged lock-in rate.

    3. Document the AMS history with the reasons the request for change was denied and update WHCS.

5.19.11.7.3  (03-15-2012)
Release of Lock-in

  1. Release the lock-in in the following situations:

    If Then
    Taxpayer meets compliance criteria in IRM 5.19.11.7.3.1, #Lock-in Release Requirements for Self-Correcting Taxpayers# or IRM 5.19.11.7.3.2, Release of Lock-in After Period of Continued Compliance 1. Input TC 972 AC 146 and enter Disposition Code "CPL "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Taxpayer was erroneously locked in 1. Input TC 972 AC 146 and enter Disposition Code "ERR "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Insolvency Unit has instructed you to release the lock-in 1. Input TC 972 AC 146 and enter Disposition Code "BNK "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer.
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Taxpayer filed bankruptcy, other than Chapter 7, between the date that the Outcome 2 case was selected for the program (generally, cycle 39 or 52) and the date that the lock-in letter was issued. See IRM 5.19.11.10.2., Bankruptcy 1. Input TC 972 AC 146 and enter Disposition Code "BNK "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer.
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Taxpayer has a pending or approved Offer in Compromise (OIC) and OIC Unit has instructed you to release the lock-in. See IRM 5.19.11.10.9., Offer in Compromise (OIC) Taxpayers 1. Input TC 972 AC 146 and enter Disposition Code "OIC "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Taxpayer is not subject to withholding 1. Input TC 972 AC 146 and enter Disposition Code "NSW "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS

    Note:

    Release lock-in using disposition code NSW when modification results in .00 withholding.

    Taxpayer is in Combat Zone with active freeze code. See IRM 5.19.11.10.3., Combat Zone 1. Input TC 972 AC 146 and enter Disposition Code "COM "
    2. Cross-reference the employer's EIN
    3. Issue Letter 2809C to employer and Letter 2813C to taxpayer
    4. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Letter 2800C is returned as undelivered and the employer is unlocatable 1. Input TC 972 AC 146 and enter Disposition Code "UND "
    2. Cross-reference the employer's EIN
    3. Document the AMS history with the reason for the release(s) and close the case on the WHCS
    Letter 2800C is returned as undelivered and you determine that the employer is out of business or the employer notifies you that they are out of business 1. Input TC 972 AC 146 and enter Disposition Code "OOB "
    2. Cross-reference the employer's EIN
    3. Document the AMS history with the reason for the release(s) and close the case on the WHCS

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

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

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  4. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

5.19.11.7.3.2  ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

    Note:

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

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • "≡ ≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    ≡ ≡ ≡ ≡ ≡

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

    Note:

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

    ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ "

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    ≡ ≡ ≡

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

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

5.19.11.8  (12-04-2009)
Unpostable Transactions

  1. Unpostable transactions are those which cannot post to the IMF. Each area is responsible for resolving its own unpostables. Unpostables are voided by the Unpostable function at the campuses and forwarded with a computer generated Form 5147, IMF–IDRS Transaction Record, and Form 4227, Intra-SC Reject or Routing Slip, or a computer-generated Form 4251, Return Charge Out. Every unpostable on Form 4251, Return Charge Out is assigned a "category code." These two digit alpha numeric codes identify the area that will work the unpostable case.

  2. Only one unpostable code at a time can be indicated on Form 5147, IMF–IDRS Transaction Record or Form 4227, Intra-SC Reject or Routing Slip. However, correct any other conditions which could cause the record to not post.

  3. See IRM 3.12.32, General Unpostables for a list of unpostable codes (UPC) and detailed processing instructions. Document 6209, IRS Processing Codes and Information also provides a brief description of each unpostable code.

  4. If a nullified unpostable penalty assessment or abatement is received with unpostable code 183, do not attempt to reinput the adjustment. Check IDRS for open CID activity and route case to the lead. The lead will contact CID for further processing instructions.

5.19.11.9  (02-09-2011)
Processing Undelivered Mail

  1. Undelivered mail is any letter, notice or other correspondence sent to an individual or business taxpayer and returned to the IRS with an indication that the individual no longer resides, or the business is no longer located at the address where the mail was sent. The following sections contain instructions for handling the various kinds of letters returned by the United States Postal Service as undeliverable.

  2. Undeliverable mail is received in Receipt and Control Branch. For the Withholding Compliance program, this mail may include but is not limited to: Letters 2800C, 2801C, 2804C, 2808C, 2809C, 2810C, 2811C, 2812C, 2813C, 3042C, 2645C and 4243C. Undelivered mail may contain a "yellow" forwarding label from the United States Postal Service (USPS) or a note indicating the party no longer resides there.

  3. All undelivered Withholding Compliance mail will be batched as undeliverable and reviewed.

    1. If a third party (practitioner, new occupant, ex-spouse) provides a new address, DO NOT update Master File. The address must be verified by the taxpayer or Power of Attorney before Master File can be updated.

  4. Undelivered mail will be processed as shown in the table below:

    Reminder:

    When required to input TC 972 AC 146 to IDRS, check IDRS to see if the TC 971 AC 146 corresponding to the transaction being reversed has posted. If there is no TC 971 AC 146, the TC 972 will unpost. To prevent this, input the TC 971 AC 146, then input the TC 972 with a posting delay of 1, then input the new TC 971 AC 146 with a posting delay of 2.

    If Then
    Letter 2800C is returned with yellow forwarding address label from the USPS
    • Update IDRS and WHCS with the forwarding address from the yellow label after verifying that the undelivered letter and yellow label is for the same employer

    • Input TC 972 AC 146 to IDRS with Disposition Code "UND" , cross-referencing the Employer Identification Number (EIN)

    • Update WHCS (Letters and Transactions section of the Employer Detail screen) with TC 972 AC 146, disposition code "UND"

    • Reissue letter to address indicated using current date

    • Input TC 971 AC 146 to IDRS using current date with posting delay of 1

    • Notate AMS history with "REISSUED" indicating letter number, EIN, new address and source of new address

    • Add reissued letter to WHCS

    • Destroy the letter

    Letter 2800C is returned with yellow forwarding address label from the USPS and research indicates Letter 2808C or Letter 2809C has been issued
    • Resend original letter to the new address

    • Extract contents of original envelope, highlight the issue date on the 2800C letter, staple envelope vertically to front of letter showing yellow sticker; fold letter and remail in an envelope labeled with new address

    • Notate AMS history with "REMAILED." Include letter number, original issue date and new address in AMS history.

    • Update IDRS and WHCS with the forwarding address from the yellow label after verifying that the undelivered letter and yellow label is for the same employer

    Note:

    This ensures employer has original lock-in letter for their files.

    Letter 2800C is returned with no forwarding address Research to see if employer is still in business.
    If employer is out of business
    • Input TC 972 AC 146 to IDRS and WHCS with Disposition Code "OOB" , cross-referencing the employer's EIN

    • Notate the AMS history with actions taken and destroy letter


    If employer is still in business and a new address is found
    • Input TC 972 AC 146 to IDRS and WHCS with Disposition Code "UND" , cross-referencing the employer's EIN

    • Reissue letter to address indicated using current date

    • Input TC 971 AC 146 to IDRS using current date with posting delay of 1

    • Notate AMS history with "REISSUED" indicating letter number, EIN, and new address

    • Add reissued letter to WHCS and destroy letter

    • DO NOT update the address on IDRS or WHCS


    If no new address is found
    • Input TC 972 AC 146 to IDRS and WHCS with Disposition Code "UND" , cross-referencing the employer's EIN

    • Notate the AMS history with actions taken and destroy letter

    Letter 2800C is returned with no forwarding address and research indicates Letter 2808C or Letter 2809C has been issued
    • If the telephone number is on Master File, research to get the current address

    • If unable to find a telephone number, research to find another address

    • Resend original letter to the new address

    • Extract contents of original envelope, highlight the issue date on the 2800C letter, staple envelope vertically to front of letter; fold letter and remail in an envelope labeled with new address

    • Notate AMS history with "REMAILED." Include letter number, original issue date and new address in AMS history.

    • DO NOT update the address on IDRS or WHCS

    • If no new valid address is found, update AMS history with actions taken and destroy letter

    Letter 2801C is returned with yellow forwarding address label from the USPS
    • Notate on AMS "UNDELIVERED 2801C" , cross- referencing the EIN

    • Update IDRS and WHCS with the forwarding address from the yellow label after verifying that the undelivered letter and yellow label is for the same taxpayer

    • Destroy letter

    Letter 2801C is returned with no forwarding address
    • Destroy letter

    Letters 2804C, 2810C, 2811C, 2812C, 2813C, 3042C, or 4243C are returned with yellow forwarding address label from the USPS
    • Resend letter to the new address

    • Extract contents of original envelope, staple envelope vertically to front of letter showing yellow sticker, fold letter and remail in an envelope labeled with new address

    • Notate AMS history with "REMAILED" with letter number and new address

    • Update IDRS and WHCS with the forwarding address from the yellow label after verifying that the undelivered letter and yellow label is for the same taxpayer

    Letters 2804C, 2810C or 4243C are returned with no forwarding address
    • Notate on AMS "UNDELIVERED XXXXC"

    • Research Command Codes (CC) IMFOLE/ENMOD and the most recent Information Returns Processing Transcripts (IRPTR) available and remail the letter to any new addresses found

    • Notate AMS history with "REMAILED" indicating letter number and new address

    • If no new address is found, notate the AMS history and destroy letter

    Letters 2811C, 2812C, 2813C, or 3042C are returned with no forwarding address
    • Destroy letter

    Letter 2808C or 2809C is returned with yellow forwarding address label from the USPS
    • Resend letter to the new address.

    • Extract contents of original envelope, staple envelope vertically to front of letter showing yellow sticker, fold letter and remail in an envelope labeled with new address

    • Notate AMS history with "REMAILED" with letter number and new address

    • Update IDRS and WHCS with the forwarding address from the yellow label after verifying that the undelivered letter and yellow label is for the same employer

    Letter 2808C or 2809C is returned with no forwarding address
    • If the telephone number is on Master File, research to get the current address

    • If unable to find a telephone number, research to find another address

    • Remail original letter to employer’s current address

    • Notate AMS history with "REMAILED" indicating letter number, EIN, and new address

    • DO NOT update the address on IDRS or WHCS

    • If no new valid address is found, update AMS history with actions taken and destroy letter

5.19.11.10  (12-04-2009)
Special Situations

  1. While working correspondence or speaking to the taxpayer by telephone, special situations will arise which may require additional research and actions to resolve the case.

5.19.11.10.1  (12-04-2009)
Payer Agent List (PAL)

  1. If the taxpayer claims that the wage and/or withholding amounts on the Form W-2, Wage and Tax Statement are incorrect, check the employer information against the Payer Agent List (PAL).

  2. If the information on the PAL confirms the taxpayer's claim, then redetermine the lock-in decision by calculating the correct number of allowances to which the taxpayer is entitled, based on the correct W-2 wage amount(s).

  3. If the calculation reveals that the taxpayer's current withholding rate is correct, take the following actions to release the lock-in:

    1. Issue Letter 2809C to the employer and Letter 2813C to the taxpayer.

    2. Input TC 972 AC 146 to IDRS with Disposition Code "ERR" , cross-referencing the employer's EIN.

    3. Update WHCS (Letters and Transactions section of the Employer Detail screen) with TC 972 AC 146, disposition code "ERR" .

    4. Notate AMS history with actions taken.

  4. If the taxpayer's current withholding rate is incorrect, take the following actions to modify the lock-in:

    1. Issue Letter 2808C to the employer and Letter 2812C to the taxpayer.

    2. Input TC 971 AC 148 to IDRS, cross-referencing the employer's EIN and entering the modified lock-in rate.

    3. Update WHCS (Letters and Transactions section of the Employer Detail screen) with TC 971 AC 148 and the modified lock-in rate.

    4. Notate AMS history with actions taken.

  5. If the information is not on the PAL then

    1. Give the taxpayer a two week deadline to provide written verification from the employer as to the correct wages and withholding, including a copy of the corrected Form W-2, Wage and Tax Statement.

    2. Notate AMS with the documentation requested and the deadline date.

    3. If a corrected Form W-2, Wage and Tax Statement is received, follow the instructions above to release or modify the lock-in based on the new amounts.

    4. Refer the Form W-2, Wage and Tax Statement information to the WHC PAL coordinator for inclusion in the PAL.

    5. If the requested documentation is not received, send Letter 2810Cto the taxpayer explaining that his or her withholding rate will remain at Single with zero (0) allowances until the information is received.

5.19.11.10.2  (12-04-2009)
Bankruptcy

  1. The Service holds that withholding is not part of the bankruptcy estate. Issuance of the lock-in letter is not considered a violation of the automatic stay.

  2. In most instances, requests for lock-in on bankruptcy cases will be made by field bankruptcy specialists via referral on Form 9045, Withholding Compliance Referral. If you are contacted by Insolvency, follow their instructions. If you are directed to release or modify the lock-in, follow general case processing procedures. In addition, document the AMS history with the name and contact information of the employee providing the direction.

  3. When working the Outcome 3 case listing, DO NOT issue a lock-in letter for a taxpayer in bankruptcy unless you have been previously directed to do so by a field bankruptcy specialist. Check IMFOLI for an open bankruptcy, identified by a literal "-V" . If present, document AMS and close the case.

  4. When working correspondence or incoming calls on Outcome 2 cases, if the taxpayer says that he or she is in bankruptcy and the bankruptcy was filed between the date that the Outcome 2 case was selected for the program (generally, cycle 39 or 52) and the date that the lock-in letter was issued, ask the taxpayer the chapter number of the bankruptcy proceeding and follow the instructions below:

    1. Chapter 7: Follow general case processing to determine whether lock-in should be modified or released.

    2. All other Chapters, or taxpayer doesn't know: Release lock-in. See IRM 5.19.11.7, Responses and Redeterminations for release procedures.

    Reminder:

    If you receive a request for reconsideration or release from a taxpayer in bankruptcy who was locked in prior to filing bankruptcy, DO NOT release the lock-in. Follow general case processing procedures as outlined in IRM 5.19.11.3, General Case Processing.

5.19.11.10.3  (12-31-2010)
Combat Zone

  1. Combat Zone cases are identified by a "-C" freeze code on IMFOLI. See IRM 5.19.10.6.3, Combat Zone Freeze Code for additional information. If you see this freeze code, check the Combat Zone indicator field on IMFOLE to determine if the freeze code is still active: 1 = active and 2 = not active.

    1. If the indicator = 1, do not lock in. Take the following actions.

    2. Issue Letter 2809C to the employer(s) and Letter 2813C to the taxpayer, to release the lock-in.

    3. Input TC 972 AC 146 with disposition code "COM"

    4. Document the history and close the case.

    5. If the indicator = 2, then the taxpayer is no longer in Combat Zone status. Document the history and continue to work the case.

5.19.11.10.3.1  (12-04-2009)
Civilians Working in a Combat Zone

  1. Civilian employees (including civilian defense contractors) serving in a combat zone or qualified hazardous duty area in support of the U.S. Armed Forces, are not exempt from withholding and filing requirements.

  2. However, they may be entitled to relief under IRC Section 7508A. If the taxpayer meets the criteria specified in IRM 5.19.10.6.2 , Combat Zone Qualified Individuals and Areas, do not lock him or her in and release any lock-in letters already issued.

5.19.11.10.3.2  (12-04-2009)
Spouses of Taxpayers Entitled to IRC Section 7508 Relief

  1. The spouses of taxpayers entitled to IRC Section 7508 relief are entitled to the same relief with two exceptions:

    • The relief does not apply to a spouse for any tax year beginning more than 2 years after the date the area ceases to be a combat zone, the operation ceases to be a contingency operation, or the operation ceases to be a qualified hazardous duty area.

    • The relief does not apply to a spouse for any period the qualifying individual is hospitalized in the United States for injuries incurred in a combat zone, a contingency operation, or a qualified hazardous duty area.

5.19.11.10.4  (12-04-2009)
Foreign Income Issues

  1. This section contains guidance and procedures for working foreign income issues.

5.19.11.10.4.1  (12-04-2009)
U.S. Citizens Working Abroad

  1. U.S. citizens working abroad may be exempt from or reduce the amount of their U.S. income tax withholding on wages if

    1. The taxpayer reasonably expects to exclude the income under either the foreign earned income exclusion or the foreign housing exclusion.

    2. The taxpayer plans to take a foreign tax credit, they may be eligible for and claim additional withholding allowances on Form W-4, Employee’s Withholding Allowance Certificate.

      Note:

      Using RTVUE, verify if Form 2555, Foreign Earned Income, was filed. In some instances a taxpayer may submit a Form 2555, Foreign Earned Income without a return. Tell the taxpayer that he or she must file a return before we can use the Form 2555, Foreign Earned Income in the withholding allowance calculation.

  2. The tests that must be met and amounts are covered in Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.

  3. The foreign earned income exclusion and foreign housing exclusion do not apply to wages received by employees of the U.S. Government or an agency thereof working in a foreign country.

5.19.11.10.4.2  (12-04-2009)
Nonresident Aliens

  1. Resident aliens are subject to income tax withholding the same as U.S. citizens on their salaries, wages, bonuses, or other pay for personal services ("wages" ). Special rules apply to wages received by nonresident aliens. See Publication 901, U.S. Tax Treaties, and Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities.

  2. The residency status assigned to an alien individual by the Service for income tax purposes is not always the same as the status assigned by the U.S. Citizenship and Immigration Services (USCIS) for immigration purposes. Under the Internal Revenue Code, an individual is considered a resident alien for U.S. tax purposes if he or she is not a citizen or national of the United States and meets either the "green card test" or the "substantial presence test" for the calendar year (January 1 - December 31).

    1. An individual will meet the green card test if he or she is a lawful permanent resident of the United States at any time during the calendar year.

    2. An individual will meet the substantial presence test if he or she has been physically present in the United States for at least 31 days during the current calendar year, AND for at least "183 days" (as specifically described below) during the three-year period that includes the current year and the two immediately preceding years.

      Note:

      For purposes of this 183-day test, each day of presence in the current year is counted as a full day, while each day of presence in the first preceding year is counted as one-third of a day and each day of presence in the second preceding year is counted as one-sixth of a day.

    3. For certain classes of individuals ( e.g. teachers and students who enter the U.S. with F, J, M, or Q visas) special rules apply where the days may not be counted. See Publication 519, U.S. Tax Guide for Aliens, for further information.

  3. Taxpayers may not owe U.S. income tax based on a tax treaty between the U.S. and a foreign country. Research Publication 901, U.S. Tax Treaties, for the applicable treaty article.

    • If the taxpayer's Form W–4 is correct as furnished, send the taxpayer closing Letter 2813C, input appropriate case remarks and close the case. The taxpayer must file a Form 1040NR to claim the treaty benefits.

    • If the taxpayer's Form W-4 is incorrect, adjust the taxpayer's withholding accordingly and send lock-in Letters 2800C and 2801C. Input the appropriate case remarks and close the case.

5.19.11.10.4.3  (12-04-2009)
Wages Subject to Mandatory Withholding of Income Taxes of a Foreign Country

  1. Wages paid to U.S. citizens or resident aliens are not subject to the withholding of U.S. federal income taxes to the extent that such wages are already subject to the mandatory withholding of income taxes of a foreign country or U.S. possession. This exception does not apply if the recipient is a U.S. citizen who is a federal employee.

  2. If the taxpayer and/or representative states that he or she is subject to mandatory withholding of a foreign country, accept his or her word and take the following actions:

    1. Issue Letter 2809C to the appropriate employer and Letter 2813C to the taxpayer to release the lock-in.

    2. Input TC 972 AC 146 to IDRS with Disposition Code "NSW" .

    3. Document in the AMS history that the taxpayer is subject to mandatory withholding, specifying the country. Also document the employer's name and EIN, that the 2809C and 2813C letters were sent, and TC 972 AC 146 (NSW) was input.

    4. Update WHCS with letters sent and transaction codes input.

    Reminder:

    If there are other wages which should be subject to income tax withholding, work those issues according to general procedures.

  3. If the taxpayer's and/or representative's response is that the taxpayer paid income taxes in a foreign country and there is no mention of the wages being subject to mandatory withholding, leave the lock-in in place and advise the taxpayer and/or representative that we need to see the return with the Form 1116, Foreign Tax Credit attached to modify the lock-in.

5.19.11.10.5  (02-09-2011)
Frivolous Correspondence

  1. If the taxpayer's response contains frivolous arguments work the case according to general procedures. Frivolous arguments may include:

    • Language objecting to Form W-4, Employee’s Withholding Allowance Certificate requirements

    • Comments on the unconstitutionality of the tax law

    • Quotes or references to the IRC which indicate that the taxpayer is free of any obligation to pay income tax liabilities

    • Statements that the taxpayer is a citizen of an independent entity within the U.S. and not liable for Federal taxes

    • Statements, often in pseudo-legalistic language, that the taxpayer is not subject to appropriate legal action for the accuracy of his/her responses

  2. See IRM 21.5.3.4.16.7, Identifying Frivolous Returns/Correspondence and Responding to Frivolous Arguments for additional information on identifying frivolous arguments.

  3. If the taxpayer is questioning the IRS authority to issue a lock-in letter, send Letter 3042Cto the taxpayer. Update AMS and WHCS.

  4. If the taxpayer requests a release or modification without any documentation to substantiate their claim, send Letter 2810C. Update IDRS with TC 971 AC 148 (unchanged rate), AMS and WHCS.

  5. If both (3) and (4) above apply, send both letters. Update IDRS, AMS and WHCS.

    Reminder:

    When documenting AMS, do not use the term, Illegal Tax Protester (ITP), or similar designation. The IRS Restructuring and Reform Act of 1998 (RRA 98), Section 3707, prohibits the use of any tax protester designation to describe the taxpayer. If you identify any such reference, immediately inform your manager. Terms such as "frivolous argument" or "tax avoidance argument" are acceptable terms to use.

  6. Upon completion of case processing, forward a copy of the case file to the Ogden Frivolous Filer Unit. Prepare Form 3210, Document Transmittal. Include the Ogden Compliance Campus address, 1973 N Rulon White Blvd., M/S 4450, Ogden, UT 84404, Attention: Frivolous Return Program. Note in the remarks section of Form 3210 that the attached is being sent for information purposes. Forward the original with a fraud indicator check sheet to the Collection Function Fraud Coordinator for review.

  7. If you continue to receive frivolous correspondence from the taxpayer after the case is closed, send it on Form 3210 to the Ogden Frivolous Filer Unit at the address shown in (6) above. Ogden will document receipt of the correspondence and send Letter 3175C, if appropriate.

5.19.11.10.6  (12-04-2009)
Household Employees

  1. Employers are NOT required to withhold federal income tax on wages paid to household employees.

  2. Household employees include, but are not limited to, housekeepers, maids, nannies, baby-sitters, private nurses, gardeners and any similar domestic worker. The work is performed in and around the employer's private home.

  3. If the taxpayer says that he/she is a household employee and this is the taxpayer's only source of wages, suggest that the taxpayer talk to his/her employer about voluntary withholding, or offer to send the taxpayer Form 1040-ES, Estimated Tax for Individuals.

  4. If lock-in letters have already been issued and you determine that the taxpayer is a household employee

    1. Issue Letter 2809C to the employer and Letter 2813C to the taxpayer to release the lock-in.

    2. Input TC 972 AC 146 with Disposition Code "NSW" .

    3. Document the history and close the case.

  5. If the household employment is not the only source of wages, subtract the household wages from the total wages and take the following actions:

    1. Compute the number of withholding allowances based on the lesser amount of wages

    2. Issue either Letters 2800C and 2801C, or 2808C and 2812C, as appropriate

    3. Input the appropriate TC 97X AC 14X

    4. Document the history and close the case

  6. If lock-in letters have not been issued, document the history and close the case.

  7. Follow general lock-in procedures if you determine that the taxpayer is not a household employee.

5.19.11.10.7  (03-15-2012)
Decedents

  1. WHC cases may be created if wages are reported for the taxpayer's SSN more than 24 months after the date of death. For Outcome 2 and Outcome 3 cases, the date of death is displayed on the WHCS Taxpayer Summary screen. It can also be found using IDRS Command Code INOLES.

  2. Decedents' wages are generally reported on Form 1041, U.S. Income Tax Return for Estates and Trusts. If you are contacted by a third party representing the decedent, determine whether the wages reported belong to the decedent. If the wages belong to the decedent, input TC 972 with disposition code "ERR" to IDRS and WHCS.

  3. Wages reported more than 24 months after the taxpayer's date of death may be an indication of identity theft. If you are contacted by the taxpayer and you determine that he or she is not the true owner of the SSN, follow general procedures for working responses and redeterminations.

5.19.11.10.8  (03-15-2012)
Members of the Clergy and Religious Workers

  1. These taxpayers are generally NOT subject to federal income tax withholding if both the following conditions apply:

    • The taxpayer is a duly ordained, commissioned, or licensed minister, a member of a religious order (who has not taken a vow of poverty), or a Christian Science practitioner, and

    • The taxpayer's pay is for qualified services.

  2. Qualified services are defined as services performed by the taxpayer in exercise of his/her ministry or in carrying out his/her duties as required by the religious organization.

    Exception:

    Ministerial services performed as an employee of the United States, a state, or U.S. possession, or a political subdivision of the foregoing, the District of Columbia, or foreign government are NOT qualified services and are subject to withholding.

    Example:

    U.S. Army chaplain; chaplain at a state prison

  3. Work performed for a nonreligious organization is considered to be qualified services if the services are assigned or designated by the taxpayer's religious organization.

  4. See Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers, for more information.

  5. If the taxpayer meets the above criteria as a member of the clergy or vow of poverty;

    1. Issue Letter 2809C to the employer and Letter 2813C to the taxpayer to release the lock-in.

    2. Input TC 972 AC 146 with Disposition Code "NSW" .

    3. Document the history and close the case.

5.19.11.10.8.1  (12-04-2009)
Vow of Poverty

  1. When the taxpayer indicates that a significant contribution was made by his or her employer to a religious order so that he/she can claim "exempt" , you must determine if he/she qualifies for exemption from taxation based on a vow of poverty. He/she must meet the qualifications shown below. A taxpayer can legitimately claim exemption from taxation pursuant to a vow of poverty when the taxpayer performs qualified services as an agent of a church or church agency. For example, the employer looks directly to the religious order, rather than to the individual member/taxpayer, for performance of services. The taxpayer must show that

    1. a contractual relationship existed between his/her secular employer and the religious order; and

    2. the religious order controlled or restricted use of the money turned over to it pursuant to the taxpayer's vow of poverty.

  2. If the taxpayer meets both of the criteria above, notate the case file and forward the case to the lead.

  3. Absent a qualified agency relationship, a member of a religious order under vow of poverty is subject to tax on income earned or received in his/her individual capacity. Proceed with general case processing.

  4. If the taxpayer indicates that contributions were made to a non-traditional church, proceed with general case processing unless the taxpayer provides documentation showing the church is exempt.

5.19.11.10.9  (12-04-2009)
Offer in Compromise (OIC) Taxpayers

  1. Do not lock in a taxpayer who has submitted an OIC for consideration or has had an OIC accepted as identified by either an unreversed TC 480 or TC 780, respectively, on IDRS.

  2. Check IMFOLI for the OIC indicator: the literal "-Y." If present, take the following actions:

    1. Issue Letter 2809C to the employer(s) and Letter 2813C to the taxpayer, to release the lock-in.

    2. Advise the taxpayer to adjust his or her withholding.

    3. Input TC 972 AC 146 with disposition code "OIC" .

    4. Document the history and close the case.

  3. If taxpayer responds that a OIC has been submitted and the OIC indicator is present on IMFOLI, take the actions in (2) above.

  4. If the taxpayer tells you that an OIC has been submitted and there is no evidence of it on IDRS, contact the Compliance Services Offer in Compromise Unit at the campuses. (See SERP under Who/Where tab for OIC Support locations) and follow their instructions.

  5. If you are instructed to release the lock-in, follow instructions in (2) above; document the history with the name of the employee providing the direction.

5.19.11.10.10  (03-15-2012)
Cautious Upon Contact (CAU)

  1. The following criteria have been established for determining CAU status:

    1. Threat of physical harm that is less severe or immediate than necessary to satisfy PDT criteria;

    2. Suicide threat by the taxpayer; or

    3. Filing or threatening to file a frivolous lien or a frivolous criminal or civil legal action against an IRS employee or contractor or an IRS employee's or contractor's immediate family member.

  2. A taxpayer who meets any of the above criteria should be approached with caution. See IRM IRM 25.4.2.2Cautious Upon Contact, for additional information.

5.19.11.10.11  (12-04-2009)
Potentially Dangerous Taxpayers (PDT)

  1. Check IMFOLI for the PDT indicator: the literal "PDT." If present, print the IMFOLI screen, highlight the indicator and route to the lead.

  2. The lead will contact the Treasury Inspector General for Tax Administration (TIGTA) for information concerning the PDT prior to making any personal contact.

  3. After making contact, document the history and route to the Tax Examiner (TE) for appropriate action.

5.19.11.10.12  (12-04-2009)
Statutory Employees

  1. Wages received as a statutory employee, under IRC Section 3121(d)(3) are exempt from income tax withholding.

  2. Statutory employees include: agent-drivers or commission drivers, full-time life insurance salespersons, home workers, and traveling or city salespersons. For details on statutory employees, see Publication 15-A, Employer's Supplemental Tax Guide (Supplement to Publication 15 (Circular E), Employer's Tax Guide).

  3. If the taxpayer says that he is a statutory employee and there are multiple employers, verify which employer(s) is the statutory employer(s). Check IRPTR for the statutory employee indicator(s) for the tax year in question.

  4. If the indicator is present take the following actions:

    1. Issue Letter 2809C to the employer and Letter 2813C to the taxpayer to release the lock-in.

    2. Input TC 972 AC 146 to IDRS with Disposition Code "NSW" .

    3. Document AMS with the employer name and EIN where the taxpayer is not subject to withholding, that 2809C/2813C letters were sent, and TC 972 AC 146 (NSW) was input.

    4. Update WHCS.

    Reminder:

    On Outcome 3 cases, do not issue lock-in letters to statutory employers. Update WHCS with TC 972 AC 146 and disposition code "NSW" and document AMS. Do not update IDRS.

  5. If the indicator is not present, tell the taxpayer that we need written verification from that employer (on employer letterhead) confirming the taxpayer's status as a statutory employee. Provide the taxpayer with the appropriate fax number and mailing address to send the documentation.

  6. If there are additional non-statutory employee Forms W-2, Wage and Tax Statement, subtract the statutory employee W-2 wage amount from the total W-2 wage amount and follow general procedures for the remaining employer(s).

5.19.11.10.13  (12-04-2009)
Third Party Sick Pay

  1. Sick pay paid by the taxpayer's employer or the employer's agent is subject to mandatory federal income tax withholding.

    Note:

    An employer's agent is defined as a third party that bears no insurance risk and is reimbursed on a cost-plus-fee basis for payment of sick pay and similar amounts. See Publication 15-A, Employer's Supplemental Tax Guide , for additional information.

  2. Sick pay paid by a third party that is not an agent of the taxpayer's employer, is NOT subject to mandatory federal income tax withholding.

  3. Third party sick pay payments are generally shown on IRPTR by the literal "3RD PARTY SICK PAY IND: YES" . Check IRPTR for the indicator. If present, take the actions shown in (4a) and (4b) below.

  4. If IRPTR does not show the above indicator and you determine that the payments are not subject to withholding and this is the only Form W-2, Wage and Tax Statement take the following actions:

    1. If lock-in letters 2800C and 2801C have not been issued, document the history and close the case.

    2. If lock-in letters have already been issued
      1. Issue Letter 2809C to payer and Letter 2813C to the taxpayer to release the lock-in.
      2. Input TC 972 AC 146 with Disposition Code "NSW" .
      3. Document the history and close the case.

  5. If you determine that the taxpayer is subject to mandatory withholding, follow general case processing procedures.

  6. If there are other wages, subtract the 3rd Party Sick Pay amount from the total of Forms W-2 and take the following actions:

    1. Follow procedures in (4) above to release lock-in on the 3rd Party Sick Pay Form W-2

    2. Compute the number of withholding allowances based on the lesser amount of wages

    3. Issue either Letters 2800C and 2801C, or 2808C and 2812C, as appropriate

    4. Input the appropriate TC 97X AC 14X

    5. Document the history and close the case

5.19.11.10.14  (03-15-2012)
Identity Theft

  1. Beginning January 1, 2012, TC 971 AC 522 will include processes to flag accounts at different stages of processing from initial identity theft allegation to closure dependent upon case specifics. Use the following directions when processing Identity theft issues:

    If And Then
    The taxpayer makes an allegation of identity theft Has not provided :
    • A copy of the U.S. Federal or State issued form of identification (i.e. driver's license, state identification card, social security card, passport)

    • A copy of a police report or IRS Affidavit Form 14039, Identity Theft Affidavit Note: For more information on required documentation see IRM 10.5.3.2.1, Identity Theft and Substantiation Documentation

    1. Input TC 971 AC 522 containing the miscellaneous field PNDCLM).

    2. Request the taxpayer to mail the required Identity Theft documentationA copy of the U.S. Federal or State issued form of identification (i.e. driver's license, state identification card, social security card, passport)A copy of a police report or IRS Affidavit Form 14039, Identity Theft Affidavit

    3. Provide the appropriate mailing address.

    4. Paper operations should Send a letter to taxpayer and request they provide the required documentation

    5. Document AMS

    The taxpayer makes an allegation of identity theft The taxpayer makes an allegation of identity theft Has provided required identity theft documentation as described in IRM 10.5.3.2.1, Identity Theft and Substantiation Documentation
    1. Input TC 971 AC 522 with miscellaneous field NOFR, INCOME, MULTFL, or INCMUL

    2. Document AMS

    3. Follow procedures in IRM 5.19.1.9. for processing the account.

    The taxpayer makes an allegation of identity theft Has provided required documentation as described in IRM 10.5.3.2.1, Identity Theft and Substantiation Documentation and you are closing the case in your function. Input TC 971 AC 501 with miscellaneous field NOFR, INCOME, MULTFL, or INCMUL 2) Update taxpayer’s module(s) with the appropriate closing action. 3) Advise taxpayer in writing the issue has been resolved. Include information for any other unresolved accounts. 4) Complete Form 9409, IRS/SSA Wages Worksheet as appropriate for wage income only and send to SSA. 5 Update AMS to show invalid income sources and Form 9409 sent to SSA.
    Taxpayer alleges identity theft There is a posted unreversed TC 971 AC 501 or 506 1) Taxpayer is not required to provide substantiation documentation 2) Input TC 971 AC 522 with miscellaneous field NODCRQ 3) Input TC 971 AC 522 with miscellaneous field PNDCLM Note: Both TC 971 AC 522 are Required if the taxpayer Is coming back in due to a new issue that has occurred since the TC 971 AC 501 or 506 has been input.
    IRS Identified Identity Theft – TC 971 AC 506 Beginning January 1, 2012 the following functions will be granted the authority to close accounts as IRS identified identity theft using TC 971 AC 506: Compliance Services Collection Operations (CSCO), and Automated Collection System (ACS/ACSS) In situations where the IRS suspects identity theft may have occurred, employees will mark accounts, using Command Code (CC) REQ77 initiated from ENMOD. Service employees will input a TC 971 AC 522 containing the Miscellaneous Field IRSID. The Secondary Date field will reflect the tax year of the incident.

    Note:

    The TC 971 AC 522 is applied to a taxpayer's account when: Substantiation documentation has been received by the IRS and the adjustment and resolution of the identity theft case will be made by a function other than the one receiving the substantiation documentation or the identity theft issue may take some time to resolve.

    Caution:

    Receipt of documentation is merely receipt of documentation. The employee assigned the case will need to verify and determine if identity theft actually occurred before the input of TC971 cc522

    Note:

    Incomplete or illegible documents will be returned to the taxpayer with a request to resubmit clear complete information. Advise the taxpayer to respond within 30 days to avoid processing delays. IRS will mark taxpayer accounts upon receipt of complete and legible documents.

  2. Input TC 971 AC 501 or AC 522 on CC ENMOD as described below. Use command code REQ77 for this input.

  3. TC 971 AC 522 input contains a miscellaneous field that must be completed consisting of the following:

    • BOD/Function, for example, WI or SBSE

    • Program Name, for example, WHC or CSCO

    • Tax Administration Source, select the appropriate source of the identity theft from the following list

    Term/Acronym Description
    INCOME Identity theft identified and substantiated due to an underreporting of income
    MULTFL Identity theft identified and substantiated due to two or more tax returns filed for one taxpayer
    INCMUL Identity theft identified and substantiated due to both underreporting of income and multiple filings
    NOFR Substantiated identity theft incidents where the victim does not have a filing requirement
    OTHER Identity theft which cannot be identified as related to any existing Tax Administration Source types

    Example:

    "MISC>WI WHC INCOME"

  4. When inputting the required information, the TRANS-DT> - field on the CC FRM77 input screen will automatically populate with the date of input.

  5. The 971 AC 522 input also contains a secondary date field used to identify the tax year at issue. Complete this field by inputting the year associated with the ID theft.

    Example:

    "SECONDARY -DT>12312006”

    Note:

    If more than one year is involved, input a separate TC 971 AC 522 for each tax year related with the ID theft incident.

  6. Use TC 972 in the event the TC 971 needs to be reversed. The TC 972 contains a miscellaneous field that must be completed including the reason for the reversal. Select the appropriate reason for the reversal from the following list:

    Abbreviation for Entry Description
    TPRQ Taxpayer request
    IRSERR Keying or other internal mistake
    IRSADM Internally identified negative impact
    FALSE Fraudulent ID theft claim
    OTHER Does not meet any of the descriptions above

    Example:

    “MISC>WI WHC TPRQ”

  7. For further guidance on ID Theft information refer to Interim Guidance SERP Alert 11A0876 or IRM 10.5.3.

5.19.11.10.15  (12-04-2009)
Taxpayers Employed by International Organizations

  1. Wages paid by international organizations are not subject to federal withholding requirements.

  2. The term "international organization" means a public international organization, designated by Executive Order as being entitled to enjoy privileges, exemptions, and immunities as an international organization under the International Organizations Immunities Act (22 U.S.C. 288-288f). See Exhibit 5.19.11-13., International Organizations Exempt from Federal Withholding Requirements for a list of international organizations.

  3. If the taxpayer or employer responds that the taxpayer works for an international organization and you have confirmed that the organization is listed in Exhibit 5.19.11-13, International Organizations Exempt from Federal Withholding Requirements take the following actions:

    1. Issue Letter 2809C to the employer and Letter 2813C to the taxpayer.

    2. Input TC 972 AC 146 to IDRS with Disposition Code "NSW" .

    3. Document in the AMS history that the taxpayer is employed by an international organization (specifying name and EIN) and is not subject to withholding on those wages. Close the case.

    4. Update WHCS with letters sent and transaction codes input.

    5. If the taxpayer has other wages which are subject to withholding, follow general case processing procedures.

  4. If the organization is not listed in Exhibit 5.19.11-13, International Organizations Exempt from Federal Withholding Requirements verify the employer's status as an international organization. Generally, this will be the number of the Executive Order covering the international organization. Route the case to the lead who will forward this information to Headquarters for a final determination.

  5. If the taxpayer or employer does not furnish the above verification, follow general case processing procedures.

5.19.11.10.16  (12-04-2009)
Litigation

  1. Taxpayers in litigation status are identified by a literal "-W" freeze. These taxpayers may be locked in if they meet lock-in criteria. Each "-W" freeze redetermination case will need to be considered on its own merits. The litigation TC 520 closing codes are 75-81 and 84.

5.19.11.11  (05-12-2010)
Civil Penalty Determinations

  1. IRC Section 6682 and related tax regulations allow the assessment of a $500 civil penalty for furnishing false information with respect to withholding if

    1. the statement made on the Form W-4, Employee’s Withholding Allowance Certificate results in less income tax withheld than would have been withheld if the Form W-4, Employee’s Withholding Allowance Certificate had been correctly completed, and

    2. there was no reasonable basis for such a statement at the time that the statement was made.

  2. You may waive the penalty, in whole or in part, if the individual's income tax for the year is equal to or less than the sum of the credits under IRC Sections 21-54 and the estimated tax payments for that tax.

  3. Civil penalty determinations may be required in cases involving a non-payment history, unfiled return(s), frivolous arguments and repeated underwithholding. Penalties must be assessed for the year that appears on the face of the Form W-4, Employee’s Withholding Allowance Certificate.

    Example:

    If the Form W-4 is for tax year 2008, the year on the face of the Form W-4 is 2008. Assess the penalty on tax year 2008.

  4. If the taxpayer has furnished more than one false Form W-4 for the same year, more than one penalty may be assessed for that year.

    Note:

    You must have a copy of the Form W-4, Employee’s Withholding Allowance Certificate that the taxpayer submitted to the employer in order to assert the civil penalty.

  5. Civil penalty determinations will only be made on referrals or special projects. Referring employees may request assertion of the penalty if they have reviewed the original W-4 submitted by the employee and the W-4 meets the criteria in (1) above. A copy of the W-4 must accompany the referral.

  6. If the penalty was not processed, notify the referring employee within 30 days of disposition. Document the history on AMS with disposition actions and the date you notified the referring employee.

5.19.11.11.1  (12-04-2009)
Creating Entities or Name Lines for Non-Return Civil Penalties

  1. This section covers procedures for assessing civil penalties when there is no entity on IMF Master File.

5.19.11.11.1.1  (03-15-2012)
Information on Establishing Entities

  1. If the taxpayer has no entity on IMF (full name and address showing on CC INOLE), you must establish the account on Master File prior to manually assessing the Withholding Compliance civil penalty on IDRS.

    1. To establish the account, follow TC 000 procedures. See IRM 3.13.5.116, Establishing a New Account (TC 000), for instructions on establishing a new account.

    2. Wait two (2) weeks for the account to post, then input the applicable tax year nameline, only if needed.

      Note:

      When a tax return posts (TC 150), it creates a nameline for that year.

    3. Wait two (2) weeks for the nameline to post, then input the civil penalty.

    4. Place the IDRS control base into "M" status pending posting of the name line.

  2. If the taxpayer's account is established but no applicable tax year nameline is present, follow the procedures in (1) b) and c) above.

  3. If the civil penalty needs to be assessed against a spouse (filing as secondary taxpayer on a joint 1040 tax return) and the spouse has no entity established on IMF:

    1. Establish their account on the valid SSN using TC 000 procedures. See IRM 3.13.5.116, Establishing a New Account (TC 000), for instructions on establishing a new account.

    2. Wait two (2) weeks for the account to post, then input the applicable tax year nameline.

    3. Wait two (2) weeks for the nameline to post, then input the civil penalty.

    4. Place the IDRS control base into "M" status pending posting of the name line.

  4. If the taxpayer's account is already established on IMF (module on Master File) and the applicable tax year nameline is present, you can assess the civil penalty with no additional actions required.

  5. If the taxpayer's account is already on Master File and has a Civil Penalty (CVPN), the name line may need to be updated on CC ENREQ (INCHG). (e.g., taxpayer’s current account name is Mary Jones and the CVPN is Mary Smith).

    Example:

    1

    Situation Action
    A joint account is on Master File for John and Mary Doe (John’s is the controlling SSN). A penalty is to be assessed against John. The account has the applicable tax year nameline (TC 150 posted). The penalty may be assessed immediately.

    Example:

    2

    Situation Action
    On the same joint account as above, the penalty is to be assessed against Mary Doe. Mary has an account on Master File under her own SSN with the name line of Mary Jones because she filed individually before filing jointly with John Doe. There is no CVPN on her account. Input a name change, address change, (if needed) and applicable tax year nameline. Wait two (2) weeks for the updates to post, then assess the penalty.

    Example:

    3

    Situation Action
    On a joint account for John and Mary Doe, the penalty is to be assessed against Mary. However, Mary has no account under her SSN on the Master File. Establish an account for Mary on Master File using her SSN and TC 000 procedures. Wait two (2) weeks for the account to post, then input the applicable tax year nameline. Wait two (2) more weeks for the nameline to post, then assess the penalty.

    Example:

    4

    Situation Action
    John Doe has a separate account with the applicable tax year nameline (TC 150 posted) and a penalty is to be assessed against John. No special action is required, the penalty may be assessed and a CVPN will be generated by Master File.

    Example:

    5

    Situation Action
    John and Mary Doe do not have an account on Master File since they are non-filers. A penalty is to be assessed against John. Establish the account using TC 000 procedures. Wait two (2) weeks for the account to post, then input the applicable tax year nameline. Wait two (2) more weeks for the nameline to post, then assess the penalty.

5.19.11.11.2  (12-04-2009)
Assessment Procedures for Penalties

  1. Assess the IRC Section 6682 civil penalty using Master File Transaction (MFT) 55 for the calendar year for which the false Form W–4, Employee’s Withholding Allowance Certificate was signed. Multiple penalties may be assessed on a given module, one for each false Form W–4, Employee’s Withholding Allowance Certificate.

    1. Use TC 290 with Reference Code 616 to assess the $500 civil penalty. IDRS generates a TC 240, Reference Code 616. The reference number uniquely identifies the penalty being assessed and serves as an indicator for generating the first notice to the taxpayer.

    2. Use IDRS Command Code ADJ54 to input W–4 civil penalty assessments. Use TC 290 with a zero amount to open the MFT 55 module. Enter the three-digit reference number, 616 for W–4, along with a positive money amount to generate a TC 240, Miscellaneous Penalty Assessment. Enter in the remarks area SD (source document) and the appropriate remarks, e.g., assess the W-4 civil penalty. This informs the Returns Files function that a document will be received for association with the adjustment Document Locator Number (DLN).

    3. The three-digit Reference Number 616 posts to the IMF and appears to the right of the TC 240. The TC 290 is a carrier record only and does not post. Place penalty assessments for each module in the 52X Blocking Series for the first assessment on a module, and in the 53X Blocking Series for subsequent assessments. Source code "0" and Reason Code "00" generate automatically.

  2. When assessing IRC Section 6682 civil penalty, input levy source information (the employer’s name, address, and EIN). Remember to update levy source information when a taxpayer informs you of a new or different employer than the one on the Form W–4, Employee’s Withholding Allowance Certificate.

5.19.11.11.3  (03-15-2012)
Civil Penalty Abatements

  1. TheIRC Section 6682 penalty may be abated if the taxpayer demonstrates having a reasonable basis for making the false statement(s) on Form W-4 when it was submitted to the employer. Requests for abatements will be received directly from the taxpayer or may be forwarded from other campuses via Form 3210, Document Transmittal.

  2. If a request for abatement is received, check IDRS for the TSIGN to see if it is assigned to a technical support function, as well as, verifying the penalty was not already abated.

    Note:

    If the penalty has been paid, the taxpayer’s request for waiver or "reasonable basis" abatement request is a claim for refund.

  3. You may find that there was sufficient withholding and credits at the time the Form W–4, Employee’s Withholding Allowance Certificate was furnished to cover the liability for the tax year when the form was in effect.

    Example:

    An employee gives his/her employer a Form W–4, Employee’s Withholding Allowance Certificate in November and the form was in effect until the end of the year. The amount of tax withheld up to the date of the Form W–4, Employee’s Withholding Allowance Certificate was greater than the tax shown (TC 150) on the subsequently filed Form 1040, U.S. Individual Income Tax Return. The penalty should be waived if proposed, or abated if assessed.

    Note:

    It may still be appropriate to leave the lock-in in effect unless the employee provides additional information to support a redetermination.

  4. Penalties may be abated if there is a reasonable basis, which exists if:

    1. The number of allowances is computed in accordance with the form instructions. See Treas. Reg. 31.6682-1(a).

    2. The taxpayer justifies the withholding allowances claimed on the Form W–4.

    3. The taxpayer demonstrates that withholding computed at the adjusted or redetermined marital status and number of allowances is the same as or less than the withholding on the original Form W–4.

      Example:

      A taxpayer furnished an exempt Form W–4 and is penalized. In a subsequent redetermination and abatement request, the taxpayer shows he/she is entitled to nineteen allowances. At the taxpayer’s income, no tax would be withheld if withholding were figured at nineteen allowances. Adjust withholding to nineteen allowances, and abate the penalty.

    4. The taxpayer establishes that the Form W–4 was completed taking into account incorrect information received from a Service employee. See Declaration of Taxpayer Rights at VIII in Publication 1. The assertion that Service error is involved should be verifiable and credible under the circumstances. Misunderstanding publications or the law is not a reasonable basis for furnishing a false Form W–4.

  5. The reasonable cause standard, which is applicable to abate some penalties (for example, penalties for late filing or late payment) does not apply to the penalty for furnishing an incorrect Form W-4.

  6. The taxpayer's reasonable basis for furnishing an incorrect Form W–4 must be related to expected tax liability. The following lists provides examples of reasons taxpayers may offer for furnishing a false W-4 that doNOT meet the reasonable basis standard:

    1. Illness,

    2. Loss of records,

    3. Overpayment of a tax liability.

  7. Do not abate or waive the W–4 civil penalty on moral, religious, political, or constitutional arguments.

  8. Do not abate penalties for reasons relating to personal finances of the taxpayer, either at the time the false Form W–4 was furnished or in connection with the taxpayer’s ability to pay the penalty.

  9. Penalty abatements must be approved by the manager.

  10. If you decide to abate or waive the penalty, send Letter 2811C to the taxpayer. A notice of adjustment is also automatically generated to notify the taxpayer. If the request is denied, use Letter 2804C and document the case history.

5.19.11.11.3.1  (12-04-2009)
Procedures for Inputting Abatements

  1. To input the abatement on unpaid penalties, use IDRS Command Code ADJ54. Use TC 290 with a zero amount to open the MFT 55 module. Enter the three-digit reference number, 616 for W–4, and place a minus sign (–) after the dollar amount on the ADJ54 screen. Enter SD (source document) and appropriate remarks, e.g., abate W–4 civil penalty. Forward the source document to files.

  2. Full or part paid penalties cannot be abated. The taxpayer must file a claim for refund using Form 843, Claim for Refund and Request for Abatement.

5.19.11.11.4  (12-04-2009)
Penalty Appeal Procedures

  1. The taxpayer has the right to appeal denied requests for abatement of the civil penalty. Follow the procedures below for preparing and transmitting a case to Appeals for review.

5.19.11.11.4.1  (12-04-2009)
Case File Preparation

  1. Include the following documents:

    • Form W-4 on which the penalty was based, submitted by the referring Service employee, if available

    • All taxpayer correspondence, including the request for abatement

    • All IRS correspondence

    • IDRS research

    • WHCS research

5.19.11.11.4.2  (12-04-2009)
Transmittal of Case to Appeals

  1. Prepare Form 3210, Document Transmittal. Complete all applicable blocks on the form including

    • Sender's full name, stop number, mailing address and phone number

    • Full description of item(s) being sent including taxpayer's name, SSN and the tax period on which the penalty was assessed using format 55-yyyy12, where yyyy is the tax year.

  2. Attach Form 3210 to the case file and forward to the appropriate Appeals office. See http://appeals.web.irs.gov/APS/caserouting.htm for the address of the Appeals office.

5.19.11.11.4.3  (12-04-2009)
Case Processing Procedures

  1. Take the following actions:

    1. If TXMOD control is still open, close with message "To Appeals " .

    2. If TXMOD control is closed, input history item, "To Appeals " , on TXMOD.

    3. Send Letter 86C informing the taxpayer that the case is being transferred to Appeals.

    4. Update AMS history with "Sent to Appeals" and the date.

    5. Update WHCS with Letter 86C and the date.

Exhibit 5.19.11-1 
Letter 2800C, WHC Lock-in Letter (To Employer)

Transmittal Number: 08–11
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 11/03/2008
Form Number: 2800C
Title: WHC Lock-in Letter to Employer - For Use by CSCO ONLY!
                                       
    Employer Identification Number: [01 12T]
Employee: [02 30V]
Social Security Number: [03 12V]
           
    Form W-4            
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    Our records indicate that your employee, named above, may not be entitled to claim exempt status or more than a specified number of withholding allowances on Form W-4, Employee's Withholding Allowance Certificate. In most instances, we reviewed Forms W-2, Wage and Tax Statement.
    WHAT ACTIONS DO YOU NEED TO TAKE?
    Begin withholding income tax from wages paid to your employee based on the following withholding rate (marital status) and withholding allowances:
          EFFECTIVE: first pay period after [04 13D]
Withholding Rate (Marital Status): [05 10V]
Withholding Allowances: [06 3V]
    Do not honor any new Form W-4 from your employee that results in less income tax withholding than at the withholding rate (marital status) and withholding allowances shown above. However, you must honor any Form W-4 or a new Form W-4 will result in MORE income tax withheld than at the withholding rate and allowances shown above.
    DO NOT ADJUST WITHHOLDING PRIOR TO THE FIRST PAY PERIOD AFTER [07 13D]
    This time period will provide your employee with an opportunity to dispute our determination before you adjust the withholding.
                      For Internal Use Only [08 12V]
                                       
    If the employee is working for you as of the date of this letter, you must provide the employee the enclosed "Employee's Copy" WITHIN 10 BUSINESS DAYS OF RECEIPT. You may follow any reasonable business practice to furnish the Employee's Copy to the employee.
    Determine whether the employee is employed as of the date of this letter based on all the facts and circumstances, including whether you have treated the employment relationship as terminated for other purposes.
    In all cases, if the employee named above is not currently performing services for you, you must still withhold based on this letter and give the attached Employee's Copy of this letter to the employee if:
      You will be paying wages subject to income tax withholding on or after the first pay period ending [09 13D]; OR
You reasonably expect the employee to resume services for you within twelve (12) months from the date of this letter; OR
The employee is on a bona fide leave of absence that does not exceed twelve (12) months; OR
The employee has a right to reemployment by law or under contract.
    WHAT MUST YOU DO IF THE EMPLOYEE NO LONGER WORKS FOR YOU?
    You are required to notify us if employment has been terminated as of the date of this letter. Please complete the attached "No Longer Works Here Information Sheet" or provide the same information on company letterhead. Submit the information to the address shown below. If you prefer, you may fax the information to the Withholding Compliance Unit at 978-474-1326.
    HOW DOES THE LAW SUPPORT THESE ACTIONS?
    Internal Revenue Code (IRC) Section 3402 requires employers to withhold federal income tax. Under section 31.3402(f)(2)-1(g)(2) of the Employment Tax Regulations, we may issue this letter to notify you that your employee is not entitled to claim a complete exempt status or claim more than the maximum number of withholding allowances shown above.
    Under IRC Section 3403 every employer required to withhold federal income tax is liable for the payment of such tax. If you do not withhold federal income tax from your employee as instructed in this letter, you will be liable for paying the additional tax that should have been withheld.
                                       
                      For Internal Use Only [10 12V]
                                       
    IRC Section 3403 also states that the employer shall not be liable to any person for the amount of any such payment. Thus, your employee does not have a "cause of action" (basis for legal action) against you to recover the amount of income tax withheld and/or prevent you from withholding the amount directed by IRS.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: withholding compliance. You can also find additional information in Publication 15 (Circular E), Employer's Tax Guide, and Publication 51 (Circular A), Agricultural Employer's Tax Guide.
    WHAT IF YOU HAVE MORE QUESTIONS?
    If you have any questions, you may contact the Withholding Compliance unit by:
      - Calling 1-866-791-0289 weekdays between the hours of 8:00 a.m. and 8:00 p.m.; or
- Sending a fax to 978-474-1326; or
- Writing to the address shown below
        Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you contact us, please give us your telephone number with the hours we can reach you.
Keep a copy of this letter for your records.
                    Sincerely yours,
                                       
                    [11 35S]
[12 35S]
                                       
                      For Internal Use Only [13 12V]
                                       
    NO LONGER WORKS HERE INFORMATION SHEET
    ATTENTION EMPLOYERS: IF THE EMPLOYEE NAMED BELOW NO LONGER WORKS FOR YOU, COMPLETE THIS FORM AND RETURN IT TO US.
  EMPLOYEE: [14 45V]
SOCIAL SECURITY NUMBER: [15 12V]
             
    DATE EMPLOYMENT ENDED: ____________________________
    COMMENTS: __________________________________________________
__________________________________________________
__________________________________________________
__________________________________________________
                                       
    _______________________________
YOUR SIGNATURE
___________________
DATE
                                       
    __________________________________________________
YOUR NAME AND TITLE (PRINT)
    TELEPHONE NUMBER AND HOURS WE CAN REACH YOU IF WE HAVE QUESTIONS:
    Telephone Number ( )_____________________ Hours____________
    COMPANY
NAME
[16 63V]
    EMPLOYER IDENTIFICATION NUMBER: [17 12T]
    FAX THIS FORM TO: 978-474-1326, OR
    MAIL TO: Internal Revenue Service
Compliance Services
Withholding Compliance Unit
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
                                       
                      For Internal Use Only [18 12V]
                                       
    THIS PAGE LEFT INTENTIONALLY BLANK
                                       
    **Employer: Provide this letter to your employee within 10 days of receipt.**
    EMPLOYEE'S COPY
    Employee: [19 60V]
Social Security Number: [20 12V]
Employer: [21 60V]
    Dear [22 30V]
    WHY ARE WE WRITING TO YOU?
    Generally, the amount your employer withholds for federal income tax must be based on your Form W-4, Employee's Withholding Allowance Certificate. However, the IRS may review whether you are entitled to claim exempt status or a certain number of withholding allowances.
    We have determined that you are not entitled to claim exempt status or more than a specified number of withholding allowances.
    WHAT INSTRUCTIONS DID WE GIVE YOUR EMPLOYERS?
    We instructed your employer to begin withholding income tax from your wages based on the following withholding rate (marital status) and withholding allowances:
          Withholding Rate (Marital Status): [23 10V]
Withholding Allowances: [24 3V]
    In addition, we have instructed your employers not to honor your current Form W-4 or a new Form W-4 from you, unless it results in MORE withholding than at the withholding rate and withholding allowances shown above.
    CAN YOU REQUEST A CHANGE OF THIS DETERMINATION?
    - You can request a change of this determination. Contact us within 30 days from the date of this letter to provide adequate time for your employer to receive new instructions, if necessary.
                                       
                      For Internal Use Only [25 12V]
                                       
    - PLEASE CALL the number shown below and explain why you are entitled to a different withholding rate and/or number of withholding allowances (or exempt status). When you call, have the following information available. If you file jointly, you must have the same information available for your spouse.
      1. Form W4 and worksheet. (You must complete the "Two Earners/Multiple Jobs Worksheet" on the back of the Form W-4, if you have more than one job or your spouse works.)
2. Most current pay stubs for all jobs.
3. Number of allowances you (and your spouse) are currently claiming on your Form(s) W-4.
4. The social security number and date of birth for any dependent you are entitled to claim.
5. A copy of the current tax return due, including all schedules, forms and attachments.
    - If you prefer you may write to us at the address shown below. Please send a written statement requesting a redetermination and the information above to support your claim that you are entitled to a different withholding rate (marital status) and/or number of withholding allowances (or exempt status).
    - If the information justifies a change to the withholding rate (marital status) and/or withholding allowances shown above, we will instruct your employer to adjust your income tax withholding accordingly.
    WHAT DOES THIS CHANGE MEAN?
    This change in your withholding rate (marital status) and/or withholding allowances will mean an increase in the amount of tax withheld from your wages.
                      For Internal Use Only [25 12V]
                                       
    CAN YOU BE ASSESSED A PENALTY?
    If there is no reasonable basis to justify the withholding rate (marital status), withholding allowances, or exempt status claimed on your Form W-4, you may be subject to a $500 civil penalty under IRC 6682 for making a false statement about your withholding.
                                       
                      For Internal Use Only [26 12V]
                                       
    We are not making a determination of your ultimate tax liability. You pay federal income tax through withholding or by making estimated tax payments throughout the year. Estimated tax is the method that may be used to pay tax on income that is not subject to withholding. If you do not pay enough tax throughout the year, you may have to pay a penalty for underpayment of estimated tax.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: withholding compliance. You can also find additional information in Publication 505, Tax Withholding and Estimated Tax, and Publication 919, How Do I Adjust My Tax Withholding.
    HOW DO YOU CONTACT THE WITHHOLDING COMPLIANCE UNIT?
    You may call the Withholding Compliance Unit weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [27 23V].
    You may also send us the information by fax. Our fax number is 978-474-1326. Please include a cover sheet giving the following information:
Date:
Name:
Phone number and hours we can reach you:
Social security number:
Number of faxed pages:
    You may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Unit
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    You may also send us the information by fax instead of mail. Our fax number is 978-474-1326. Please include a cover sheet giving the following information:
Date:
Name:
Phone number:
Your Taxpayer Identification Number:
Social Security Number of your employee:
Number of faxed pages:
    Whenever you write, please include this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                                       
                      For Internal Use Only [28 12V]
                                       
--------------------------------------------------------------------------------------------------------------
NOTE: This letter should only be issued by CSCO employees authorized to work WHC cases
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Addressed to Employer
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Enter Employee's name in fill-ins 02 and 14
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Enter Employee's SSN in fill-ins 03 and 15
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Enter letter date plus 60 days in fill-in 07
--------------------------------------------------------------------------------------------------------------
                                       
                    Letter 2800C (Rev. 08-2008)

Exhibit 5.19.11-2 
Letter 2801C, WHC Lock-in Letter (To Employee)

Transmittal Number: 08–11
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 11/03/2008
Form Number: 2801C
Title: WHC Lock-in Letter to Employee - For Use by CSCO ONLY!
                                       
    Social Security Number: [01 12T]
Employer: [02 60V]
Employer Identification Number: [03 12V]
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    Generally, the amount your employer withholds for federal income tax must be based on your Form W-4, Employee's Withholding Allowance Certificate. However, the IRS may review whether you are entitled to claim exempt status or a certain number of withholding allowances.
    We have determined that you are not entitled to exempt status or more than a specified number of withholding allowances.
    WHAT INSTRUCTIONS DID WE GIVE YOUR EMPLOYER(S)?
    We instructed your employer to begin withholding income tax from your wages based on the following withholding rate (marital status) and allowances:
          Withholding Rate (Marital Status): [04 10V]
Withholding Allowances: [05 2V]
    In addition, we have instructed your employer(s) not to honor your current Form W-4 or a new Form W-4 from you, unless it results in MORE —withholding than at the withholding rate and withholding allowances shown above.
    CAN YOU REQUEST A CHANGE OF THIS DETERMINATION?
    - You can request a change of this determination. Contact us within 30 days from the date of this letter to provide adequate time for your employer to receive new instructions, if necessary.
    - PLEASE CALL the number shown below and explain why you are entitled to a different withholding rate and/or number of withholding allowances (or exempt status). When you call, have the following information available. If you file jointly, you must have the same information available for your spouse.
      1. Form W-4 and worksheets. (You must complete the "Two Earners/Multiple Jobs Worksheet" on the back of the Form W-4, if you have more than one job or your spouse works.)
2. Most current pay stubs for all jobs.
3. Number of withholding allowances you (and your spouse) are currently claiming on your Form(s) W-4.
4. The social security number and date of birth for any dependent you are entitled to claim.
5. A copy of the current tax return due, including all schedules, forms and attachments.
    - If you prefer you may write to us at the address shown below. Please send a written statement requesting a redetermination and the information above to support your claim that you are entitled to a different withholding rate (marital status) and/or number of withholding allowances (or exempt status).
    - If the information justifies a change to the withholding rate (marital status) and/or withholding allowances shown above, we will instruct your employer to adjust your income tax withholding accordingly.
    WHAT DOES THIS CHANGE MEAN?
    This change in your withholding rate (marital status) and/or withholding allowances will mean an increase in the amount of tax withheld from your wages.
    CAN YOU BE ASSESSED A PENALTY?
    If there is no reasonable basis to justify the withholding rate (marital status), withholding allowances, or exempt status claimed on your Form W-4, you may be subject to a $500 civil penalty under IRC 6682 for making a false statement about your withholding.
    We are not making a determination of your ultimate tax liability. You pay federal income tax through withholding or by making estimated tax payments throughout the year. Estimated tax is the method that may be used to pay tax on income that is not subject to withholding. If you do not pay enough tax throughout the year, you may have to pay a penalty for underpayment of estimated tax.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: withholding compliance.
    You can also find additional information in Publication 505, Tax Withholding and Estimated Tax, and Publication 919, How Do I Adjust My Tax Withholding.
    HOW DO YOU CONTACT THE WITHHOLDING COMPLIANCE UNIT?
    You may call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [06 23V].
    You may also send us the information by fax. Our fax number is 978-474-1326. Please include a cover sheet giving the following information:
Date:
Name:
Phone number and hours we can reach you:
Social security number:
Number of faxed pages:
    You may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you write, please include this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                    Sincerely yours,
                                       
                    [07 35S]
[08 35S]
    Enclosures:
Form W-4
Envelope
A                                    
B The following employers have also received a letter instructing them to withhold income tax based on the filing status and withholding allowances identified above.
  B Employer's Name
B
B [09 63V]
B [10 63V]
B [11 63V]
B [12 63V]
B [13 63V]
B [14 63V]
B [15 63V]
B [16 63V]
B [17 63V]
B [18 63V]
--------------------------------------------------------------------------------------------------------------
NOTE: This letter should only be issued by CSCO employees authorized to work WHC cases
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Address to Employee
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Enter Employee's SSN in fill-in 01
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Enter Employer's name in fill-in 02
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Enter Employer's EIN in fill-in 03
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Use Sel. A if Sel. C is NOT used
--------------------------------------------------------------------------------------------------------------
                                       
                    Letter 2801C (Rev. 08-2008)

Exhibit 5.19.11-3 
Letter 2808C, WHC Modified Lock-in (To Employer)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2808C
Title: Form W-4 Lock-In Close Change to Employer
                                       
    Employer Identification Number: [01 12V]
Employee: [02 30V]
Social Security Number: [03 12V]
           
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We are adjusting the withholding rate and/or withholding allowances specified in our previous letter to you for your employee named above.
    WHAT ACTION DO YOU NEED TO TAKE?
    Begin withholding income tax from wages paid to your employee based on the following withholding rate and withholding allowances:
          Withholding Rate (Marital Status): [04 10V]
Withholding Allowances: [05 3V]
    Implement this upon receipt of this letter.
    Don't honor any new Form W-4 from this employee UNLESS it results in MORE income tax withheld than the withholding rate and allowances shown above.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
   
  • Visit our website at www.irs.gov, keyword: withholding compliance.

  • Publication 15 (Circular E), Employer's Tax Guide

  • Publication 51 (Circular A), Agricultural Employer's Tax Guide

  • For tax forms, instructions and publications, visit www.irs.gov or call 1-800-TAX-FORM (1-800-829-3676)

You can also find additional information in and .
    WHAT IF YOU HAVE MORE QUESTIONS?
    If you have any questions, you may contact the Withholding Compliance Unit by:
    Calling 1-866-791-0289 weekdays between the hours of 8:00 a.m. and 8:00 p.m.; or
Sending a fax to 855–202–8300; or
Writing to the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Unit
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you contact us please give us your telephone number with the hours we can reach you.
    Keep a copy of this letter for your records.
                                       
                    Sincerely yours,
                                       
                    [06 35S]
[07 35S]
                                       
                                       
                    Letter 2808C (Rev. 11–2011)

Exhibit 5.19.11-4 
Letter 2812C, WHC Modified Lock-in (To Employee)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2812C
Title: Form W-4 Redetermination Acceptance
                                       
    Social Security Number: [01 12T]
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We reviewed the additional information you gave us. Based on this information, we are modifying the withholding rate (marital status) and/or withholding allowances in our previous letter(s). We will instruct your employer(s) to withhold income tax based on the following withholding rate and allowances:
          Employer: [02 60V]
Withholding Rate (Marital Status): [03 10V]
Withholding Allowances: [04 3V]
    You do not need to take any further action.
    CAN YOU CHANGE THIS DETERMINATION?
    If at any time your personal or financial situation changes (for example, marriage, birth of child, or major change in wages), you may need to request a change of this determination.
    PLEASE CALL the number shown below and explain why you are entitled to a different withholding rate and/or number of withholding allowances (or exempt status). When you call, have the following information available. If you file jointly, you must have the same information available for your spouse.
      1. Form W-4, Employee’s Withholding Allowance Certificate, and worksheets (You must complete the "Two Earners/Multiple Jobs Worksheet" on the back of the Form W-4, if you have more than one job or your spouse works).
2. Most current pay stubs for all jobs.
3. The social security number and date of birth for any additional dependents you are entitled to claim.
4. A copy of the current tax return due, including all schedules, forms and attachments.
    If you prefer you may write to us at the address shown below. Please send a written statement requesting a redetermination and the information above to support your claim that you are entitled to a different withholding rate (marital status) and/or number of withholding allowances (or exempt status).
    You can give your employer(s) a Form W-4 which results in MORE income tax withholding than at the withholding rate and withholding allowances shown above and your employer(s) must honor it.
  A
A
[05 385V]
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: withholding compliance.
    HOW DO YOU CONTACT THE WITHHOLDING COMPLIANCE UNIT?
    You may call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [06 23V].
    You may also send us the information by fax. Our fax number is 855–202–8300. Please include a cover sheet giving the following information:
Date:
Name:
Phone number and hours we can reach you:
Social Security Number:
Number of faxed pages:
    You may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you write, please include a copy of this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                                       
                    Sincerely yours,
                                       
                    [07 35S]
[08 35S]
    Enclosures:
Envelope
Form W-4
                                       
  B                                    
  C The following employers have also received a letter instructing them to withhold income tax based on the filing status and withholding allowances identified.
  C
C
C
Employer's Name
[09 63V]
Marital Status: [10 10V] Withholding Allowances: [11 2V]
  D
D
D
Employer's Name
[12 63V]
Marital Status: [13 10V] Withholding Allowances: [14 2V]
  E
E
E
Employer's Name
[15 63V]
Marital Status: [16 10V] Withholding Allowances: [17 2V]
  F
F
F
Employer's Name
[18 63V]
Marital Status: [19 10V] Withholding Allowances: [202V]
  G
G
G
Employer's Name
[21 63V]
Marital Status: [22 10V] Withholding Allowances: [23 2V]
                                       
--------------------------------------------------------------------------------------------------------------
NOTE: If Sel. A or C-G are not needed, you must choose Sel. B
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Use Sel. C if there is more than one employer.
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
NOTE: Use Sel. D thru G for additional employers. Must also use Sel. C.
--------------------------------------------------------------------------------------------------------------
                                       
                    Letter 2812C (Rev. 08-2008)

Exhibit 5.19.11-5 
Letter 2810C, WHC No Change (To Employee)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2810C
Title: Form W-4 Redetermination Denial
                                       
    Social Security Number: [01 12T]
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We determined the information you supplied does not support a change to our withholding instructions given to your employer(s) listed below.
    CAN YOU CHANGE THIS DETERMINATION?
    If at any time your personal or financial situation changes (for example, marriage, birth of child, or major change in wages), you may need to request a change of this determination.
    PLEASE CALL the number shown below and explain why you are entitled to a different withholding rate and/or number of withholding allowances (or exempt status). When you call, have the following information available. If you file jointly, you must have the same information available for your spouse.
    1. Form W-4, Employee's Withholding Allowance Certificate, and worksheets (You must complete the "Two Earners/Multiple Jobs Worksheet" on the back of the Form W-4, if you have more than one job or your spouse works).
2. Most current pay stubs for all jobs.
3. The social security number and date of birth for any additional dependents you are entitled to claim.
4. A copy of the current tax return due, including all schedules, forms and attachments.
    If you prefer you may write to us at the address shown below. Please send a written statement and the information above to support your claim that you are entitled to a different withholding rate (marital status) and/or number of withholding allowances (or exempt status).
    You can give your employer(s) a Form W-4 which results in MORE income tax withholding than at the withholding rate and withholding allowances shown above and your employer(s) must honor it.
  A
A
[02 385V]
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: withholding compliance.
    HOW DO YOU CONTACT THE WITHHOLDING COMPLIANCE UNIT?
    You may call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [03 23V].
    You may send us the information by fax. Our fax number is 855–202–8300. Please include a cover sheet giving the following information:
Date:
Name:
Phone number and hours we can reach you:
Social security number:
Number of faxed pages:
    You may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you write, please include a copy of this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                                       
                    Sincerely yours,
                                       
                    [04 35S]
[05 35S]
  B                                    
  C These employers have received a letter instructing them to withhold income tax based on the filing status and withholding allowances identified.
  C
C
C
Employer's Name
[06 63V]
Marital Status: [07 10V] Withholding Allowances: [08 2V]
  D
D
D
Employer's Name
[09 63V]
Marital Status: [10 10V] Withholding Allowances: [11 2V]
  E
E
E
Employer's Name
[12 63V]
Marital Status: [13 10V] Withholding Allowances: [14 2V]
  F
F
F
Employer's Name
[15 63V]
Marital Status: [16 10V] Withholding Allowances: [17 2V]
  G
G
G
Employer's Name
[18 63V]
Marital Status: [19 10V] Withholding Allowances: [20 2V]
                                       
--------------------------------------------------------------------------------------------------------------
NOTE: Use Sel. B if no other selective paragraphs are used.
--------------------------------------------------------------------------------------------------------------
                                       
                    Letter 2810C (Rev. 08-2008)

Exhibit 5.19.11-6 
Letter 2809C, WHC Release of Lock-in (To Employer)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2809C
Title: WHC Release of Prior Lock-in (to Employer)
                                       
    Employer Identification Number: [01 12V]
Employee: [02 30V]
Social Security Number: [03 12V]
           
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We are releasing our previous withholding instructions, which specified a withholding rate and withholding allowances, for the employee named above.
    WHAT ACTION DO YOU NEED TO TAKE?
    Honor the employee's current Form W-4, Employee's Withholding Allowance Certificate, if valid. Accept any valid Form W-4 that your employee submits in the future.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: withholding compliance. You can also find additional information in Publication 15 (Circular E), Employer's Tax Guide and Publication 51 (Circular A), Agricultural Employer's Tax Guide.
    WHAT IF YOU HAVE MORE QUESTIONS?
    If you have any questions, you may contact the Withholding Compliance Unit by:
    Calling 1-866-791-0289 weekdays between the hours of 8:00 a.m. and 8:00 p.m.; or
Sending a fax to 855–202–8300; or
Writing to the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Unit
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you contact us, please give us your telephone number with the hours we can reach you.
    Keep a copy of this letter for your records.
                                       
                    Sincerely yours,
                                       
                    [04 35S]
[05 35S]
                                       
                                       
                    Letter 2809C (Rev. 08-2008)

Exhibit 5.19.11-7 
Letter 2813C, WHC Release of Lock-in (To Employee)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2813C
Title: Release of Prior Lock-in (To Employee)
                                       
    Social Security Number: [01 12T]
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We are releasing our previous withholding instructions, which specified a withholding rate and withholding allowances. We will direct your employer(s) listed below to honor your current Form W-4, Employee's Withholding Allowance Certificate, if valid. Your employer(s) will also be directed to honor any valid Form W-4 you submit in the future.
    WHAT ACTION DO YOU NEED TO TAKE?
    It is a legal requirement to have adequate withholding from wages and to file all tax returns timely and pay all taxes in full. Any future failures to file or full pay timely could result in subsequent lock-in letters being issued.
    In order to meet the above requirement, you should submit a new Form W-4 to your employer(s) any time your personal or financial situation changes (for example, marriage, birth of child, or major change in wages).
A
A
[02 385V]
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    You can also find additional information on our website at www.irs.gov, keyword: topic 753.
    WHAT IF YOU HAVE MORE QUESTIONS?
    If you have any questions, you may contact the Withholding Compliance Unit by:
    Calling [03 14V] weekdays between the hours of 8:00 a.m. and 8:00 p.m.; or
Sending a fax to 855–202–8300; or
Writing to the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Unit
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you contact us please give us your telephone number with the hours we can reach you.
    Keep a copy of this letter for your records.
                                       
                    Sincerely yours,
                                       
                    [04 35S]
[05 35S]
B                                    
C The following employer(s) will receive a letter instructing them to honor any valid Form W-4, Employee's Withholding Allowances, you submit.
    C Employer's Name
C
C [06 63V]
C [07 63V]
C [08 63V]
C [09 63V]
C [10 63V]
C [11 63V]
C [12 63V]
C [13 63V]
C [14 63V]
C [15 63V]
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NOTE: Enter telephone number in fill-in 03
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NOTE: If Sel. A or C are not used, you must use Sel. B
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NOTE: Use Sel. C to list employer(s)
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                    Letter 2813C (Rev.08-2008)

Exhibit 5.19.11-8 
Letter 2804C, Form W-4 Penalty Abatement Denied (To Employee)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2804C
Title: Civil Penalty Abatement Denied
                                       
Social Security Number: [01 12T]                
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We have reviewed your request for removal of the $500 civil penalty for providing false information on your Form W-4, Employee's Withholding Allowance Certificate, regarding your withholding rate (marital status) and/or withholding allowances (or exempt status). This letter is your legal notice that we have denied your request.
    WHAT ACTIONS WILL BE TAKEN?
    We will take no further action on your request for removal of the penalty.
    WHAT APPEAL RIGHTS DO YOU HAVE?
    If you wish to appeal our decision, your appeal must be submitted within 30 days from the date of this letter.
    Enclosed is Publication 5, "Your Appeal Rights and How to Prepare a Protest If You Don't Agree" , explaining the appeal process.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: appeal.
    HOW DO YOU CONTACT THE WITHHOLDING COMPLIANCE UNIT?
    You may call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [02 23V].
    You may send us the information by fax. Our fax number is 855–202–8300. Please include a cover sheet giving the following information:
Date:
Name:
Phone number and hours we can reach you:
Social security number:
Number of faxed pages:
    You may write to us at the address shown below:
    Internal Revenue Service
Compliance Services
Withholding Compliance Unit
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you write, please include this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                                       
                    Sincerely yours,
                                       
                    [03 35S]
[04 35S]
                                       
    Enclosure:
Publication 5
                                       
                    Letter 2804C (Rev. 08-2008)

Exhibit 5.19.11-9 
Letter 2811C, Form W-4 Penalty Abatement Accepted (To Employee)

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 2811C
Title: Form W-4 Penalty Abatement Accepted (To Employee)
                                       
Social Security Number: [01 12T]                
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    We have reviewed your request for removal of the $500 civil penalty for providing false information on your Form W-4, Employee's Withholding Allowance Certificate, regarding your withholding rate (marital status) and/or withholding allowances (or exempt status). We have approved your request.
    We will adjust your account to remove the $500 civil penalty. If you don't owe any additional taxes or other legal debts that we are required to collect, you should receive a refund of any amounts you have already paid within 8 to 10 weeks.
    WHERE CAN YOU FIND ADDITIONAL INFORMATION?
    Additional information is available on our website at www.irs.gov, keyword: topic 753.
    HOW DO YOU CONTACT THE WITHHOLDING COMPLIANCE UNIT?
    You may call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [02 23V].
    You may send us the information by fax. Our fax number is 855–202–8300. Please include a cover sheet giving the following information:
Date:
Name:
Phone number and hours we can reach you:
Social security number:
Number of faxed pages:
    You may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you write, please include a copy of this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                                       
                    Sincerely yours,
                                       
                    [03 35S]
[04 35S]
                                       
                                       
                    Letter 2811C (Rev. 08-2008)

Exhibit 5.19.11-10 
Letter 3042C, Information on the Legal Authority for the IRS Withholding Compliance Program (To Employee)

Transmittal Number: 08–10
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 10/06/2008
Form Number: 3042C
Title: Regulatory Authority Information Letter
                                       
Social Security Number: [01 12T]                
    Dear [-30V]
    WHY ARE WE WRITING TO YOU?
    This letter is in response to your inquiry asking for information about the legal authority supporting the IRS Withholding Compliance Program. This letter contains
      - Citations for the laws and regulations that give us authority
- Where you can find these laws and regulations
- What authority the laws and regulations give us
- If you have the right to take legal action against your employer
- What to do if you have more questions
    WHAT LAWS AND REGULATIONS GIVE US AUTHORITY FOR THE WITHHOLDING COMPLIANCE PROGRAM?
      Internal Revenue Code (IRC)
      Sections 3402 and 3403 (Title 26 of the United States Code)
      Treasury Regulations:
      Sections 31.3402(a)-1 through 31.3402(f)(6)-1 (Title 26 of the Code of Federal Regulations). In particular, Section 31.3402(f) (2)-1(g). Treasury Decision 9337, Withholding Exemptions, 72 F.R. 38478 (Federal Register, July 13, 2007)
    WHERE CAN YOU FIND THESE LAWS AND REGULATIONS?
    You can find copies of the Internal Revenue Code, the Code of Federal Regulations, and the Federal Register at many local libraries. You can also find "Laws and Regulations" at the Reference Center on www.usa.gov. Treasury Decision 9337 is available at www.irs.gov/pub/irs-irbs/irb07-35.pdf.
    WHAT AUTHORITY DO THE LAWS AND REGULATIONS GIVE US?
    The IRS has the authority to ensure that the deduction and withholding of federal income tax from your wages is in compliance with the laws and regulations, cited above. They give us the authority, when necessary, to instruct employers to withhold taxes from your wages based on the marital status and number of withholding allowances that we specify.
    IRC Section 3403 holds employers liable and accountable to the United States for the federal income taxes that the laws and regulations require your employer to deduct and withhold.
    CAN YOU TAKE LEGAL ACTION AGAINST YOUR EMPLOYER?
    IRC Section 3403 also states that the employer shall not be liable to any person for the amount of any payment required to be deducted and withheld. Thus, when your employer complies with the laws and regulations listed above and withholds federal income tax from your wages, you have no "cause of action" (basis for legal action) against your employer to recover the amount of income tax withheld and/or to prohibit your employer from withholding the amount directed by IRS.
    WHAT IF YOU HAVE MORE QUESTIONS?
    If you have any questions, you may call the Withholding Compliance Unit, weekdays between 8:00 a.m. and 8:00 p.m. at [02 23V].
                                       
                    Sincerely yours,
                                       
                    [03 35S]
[04 35S]
                                       
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NOTE: Enter toll-free number in fill-in 02
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                    Letter 3042C (Rev. 08-2008)

Exhibit 5.19.11-11 
Letter 4074C, WHC - Reply to Employer Inability to Change Automated W-4 System

Transmittal Number: 12–01
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 01/03/2012
Form Number: 4074C
Title: WHC - Reply to Employer Inability to Change Automated W-4 System
                                       
    Employer Identification Number: [01 12T]
Contact: [02 30V]
Telephone: [03 15V]
           
    Dear [-30V]
    Thank you for your inquiry concerning our requirement that you prevent certain employees from increasing the number of withholding allowances on their Forms W-4, Employee's Withholding Allowance Certificate. Under Internal Revenue Code section 31.3402(f)(2)-1T of the Employment Tax regulations, if the IRS issues a notice (commonly referred to as a "lock-in letter") to you (the employer) specifying the maximum number of withholding allowances permitted for an employee, you (the employer) must disregard any new Form W-4, from that employee, UNLESS the employee wants MORE tax withheld than our previous determination. Failure to withhold as directed by the IRS makes you (the employer) liable for the tax that should have been withheld from the employee's pay.
    Many employers have computer systems where employees can increase or decrease the number of withholding allowances at will. These systems must be able to prevent employee's from decreasing their withholding allowances from the specified rates in the lock-in letter, after the lock-in letter takes effect. However, if, at any time, the employee furnishes a Form W-4 that results in MORE tax withheld than required by the lock-in letter, you (the employer) must withhold tax based on that Form W-4 certificate.
    While we understand that programming changes or manual adjustments may be necessary to follow the terms of the lock-in letter, we must point out that this requirement was published in 1997. The final regulations on electronic Forms W-4 (Treasury DDetermination 8706) provided that:
      [T]he IRS and Treasury expect that electronic systems, alone or in conjunction with the rest of an employer's payroll system, will ensure compliance with the advice contained in a lock-in letter. For instance, an electronic system can ensure compliance with a lock-in letter by prohibiting an employee for whom a lock-in letter was issued from filing any electronic Form W-4 or prohibiting the employee from claiming more withholding exemptions than the number specified in the IRS notice.  
    WHAT IF YOU HAVE MORE QUESTIONS?
A] If you have any questions, you may call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at [04 23V].
B] If you have any questions, you may call [05 29V], ID # [06 10V], weekdays between the hours of [07 10V] and [08 14V] at [09 23V].
    If you prefer, you may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    Whenever you write, please include this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records.
    Telephone Number ( )_____________________ Hours____________
                                       
                    Sincerely yours,
                                       
                    [10 35S]
[11 35S]
                                       
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NOTE: In fill-in 08, include applicable time zone
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                    Letter 4074C (New 11–2011)

Exhibit 5.19.11-12 
Letter 4243C, Withholding Compliance Additional Information Request

Transmittal Number: 08-11
Originating Office: SE:W:CP:FPC:FC
Date of Issue: 11/03/2008
Form Number: 4243C
Title: WHC - Withholding Compliance Additional Information Request
                                       
    Taxpayer Identification Number:
Tax Period(s):

Form:
[01 12T]
[02 13P] [03 13P]
[04 13P] [05 13P]
[06 9V]
                                       
    Dear [-30V]
    Why Are We Writing To You?
  A We are writing in response to your correspondence received on [07 13D]. We need additional information to process your request for a change to the instructions given your employer to withhold income tax from your wages based on a specified withholding rate (Marital Status) and allowances.
  B This is in response to the inquiry of [08 13D], from [09 20V]. We have no record that you authorized [10 4V] act for you in this matter. Please notify [11 4V] that we have replied directly to you. If you wish to authorize a third party to represent you, please complete Form 2848, Power of Attorney and Declaration of Representative. For more information about this form, visit our website at www.irs.gov, keyword: POA, or call the telephone number listed at the end of this letter.
    What Do You Need To Do?
  C Please FAX or mail the additional information requested below and include a copy of your completed Form W-4. We have enclosed an envelope for your convenience.
  D Copy of your Marriage Certificate
  E Copy of your spouse's Social Security Card
  F Copy of the Social Security Cards for each of your dependents
  G Copy of the Birth Certificate for each of your dependents
  H Most recent Forms W-2 (from all employers) for yourself and your spouse
  I Current pay stub(s) (from all employers) for yourself and your spouse
  J Current receipts or copies of cancelled checks for child and dependent care expenses
  K If you are planning to itemize your deductions on the Form 1040 you will file for the current year, please provide receipts and/or statements to substantiate any of the following expenses that apply:
- Mortgage interest
- State and local taxes
- Charitable contributions
- Real estate taxes
- Medical expenses
- Miscellaneous expenses
  L If you are planning to make adjustments to your income, when you file the current year Form 1040, please provide receipts and/or statements to substantiate any of the following expenses that apply:
- Deductible IRA contributions
- Receipts and/or cancelled checks for alimony you paid
- Student loan interest
- Other allowable adjustments to income
  M If you are currently eligible to claim tax credits such as foreign tax credit, education credit, or adoption credit, provide the projected credit amount and receipts and/or statements to substantiate those credits.
  N [12 385V]
  O Our information indicates your spouse earns wages. If you have a working spouse, please calculate the total number of allowances you believe you are entitled to claim on all jobs by completing the worksheets from only one Form W-4, including the Two Earners/Multiple Jobs Worksheet on page 2 of the Form W-4.
  P Our information indicates you currently have more than one job. Please calculate the total number of allowances you believe you are entitled to claim on all jobs by completing the worksheets from only one Form W-4, including the Two Earners/Multiple Jobs Worksheet, on P page 2 of the Form W-4.
  Q Our information indicates your spouse earns wages and you currently have more than one job. Please calculate the total number of allowances you believe you are entitled to claim on all jobs by completing the worksheets from only one Form W-4, including the Two Earners/Multiple Jobs Worksheet, on page 2 of the Form W-4.
  R [13 385V]
    What Happens If You Don't Respond?
    If we do not receive your response by [14 13D], your employer has been instructed to change your withholding allowances to [15 7V] status with [16 2V] allowances.
    If You Have More Questions
    If you have any questions, please call the Withholding Compliance Unit, weekdays between the hours of 8:00 a.m. and 8:00 p.m. at 866-791-0289. If you live outside of the United States please call 978-474-1622 between the hours of 8:00 a.m. and 8:00 p.m. This is not a toll-free number.
    If you prefer, you may write to us at the address shown below:
      Internal Revenue Service
Compliance Services
Withholding Compliance Program
P.O. Box 9047, Stop 837
Andover, MA 01810-0947
    You may also send us the information by fax instead of mail. Our fax number is 978-474-1326. Please include a cover sheet giving the following information:
Date:
Name:
Phone number:
Your Social Security Number:
Social Security Number of your spouse:
Number of faxed pages:
    Whenever you write, please include this letter and, in the spaces below, give us your telephone number with the hours we can reach you. Keep a copy of this letter for your records. Our response may take up to 30 days.
    Telephone Number _____________________ Hours____________
    Thank you for your cooperation.
                                       
                    Sincerely yours,
                                       
                    [18 35S]
[19 35S]
                                       
  S Enclosures:
Envelope
Form W-4
Form 2848
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If Sel. B is used, also use Sel. S
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NOTE: If Sel. C is used, you must also use Sel. B thru N as applicable
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                    Letter 4043C (Rev. 08-2008)

Exhibit 5.19.11-13 
International Organizations Exempt from Federal Withholding Requirements

International Organization Executive Order Number and Date
African Development Bank 12403 of February 8, 1983
African Development Fund 11977 of March 14, 1977
African Union
(formerly Organization of African Unity)
13377 of April 13, 2005 (revokes 11767 of February 19, 1974)
Asian Development Bank 11334 of March 7, 1967
Border Environmental Cooperation Commission 12904 of March 16, 1994
Caribbean Organization 10983 of December 30, 1961
Commission for Environmental Cooperation 12904 of March 16, 1994
Commission for Labor Cooperation 12904 of March 16, 1994
Commission for the Study of Alternatives to the Panama Canal 12567 of October 2, 1986
Customs Cooperation Council 11596 of June 5, 1971
European Bank for Reconstruction and Development 12766 of June 18, 1991
European Central Bank 13307 of May 29, 2003
European Space Agency (formerly the European Space Research Organization) 11318 of Dec. 5, 1966 and 12766 of June 18, 1991
Food and Agriculture Organization 9698 of February 19, 1946
Global Fund To Fight AIDS, Tuberculosis and Malaria 11395 of January 13, 2006
Great Lakes Fishery Commission 11059 of October 23, 1962
GRECO (Council of Europe in Respect of the Group of States Against Corruption) 13240 of December 18, 2001
Hong Kong Economic and Trade Offices 13052 of June 30, 1997
Inter-American Defense Board 10228 of March 26, 1951
Inter-American Development Bank 10873 of April 8, 1960 and 11019 of April 27, 1962
Inter-American Institute for Cooperation for Agriculture 9751 of July 11, 1946
Inter-American Investment Corporation 12567 of October 2, 1986
Inter-American Statistical Institute 9751 of July 11, 1946
Inter-American Tropical Tuna Commission 11059 of October 23, 1962
International Atomic Energy Agency 10727 of August 31, 1957
International Bank for Reconstruction and Development (World Bank) 9751 of July 11, 1946
International Boundary and Water Commission - the United States and Mexico 12467 of March 2, 1984
International Centre for Settlement of Investment Disputes 11966 of January 19, 1977
International Civil Aviation Organization 9863 of May 31, 1947
International Coffee Organization 11225 of May 22, 1965
International Committee of the Red Cross 12643 of June 23, 1988
International Cotton Advisory Committee 9911 of December 19, 1947
International Cotton Institute 11283 of May 27, 1966
International Criminal Police Organization (INTERPOL) (Limited Privileges) 12425 of June 16, 1983
International Development Association 11966 of January 19, 1977
International Development Law Institute 12842 of March 29, 1993
International Fertilizer Development Center 11977 of March 14, 1977
International Finance Corporation 10680 of October 2, 1956
International Food Policy Research Institute (Limited Privileges) 12359 of April 22, 1982
International Fund for Agricultural Development 12732 of October 31, 1990
International Hydrographic Bureau 10769 of May 29, 1958
International Joint Commission - the United States and Canada 9972 of June 25, 1948
International Labor Organization 9698 of February 19, 1946
International Maritime Organization (formerly the Intergovernmental Maritime Consultative Organization) 10795 of December 13, 1958
International Maritime Satellite Organization 12238 of September 12, 1980
International Monetary Fund 9751 of July 11, 1946
International Organization for Migration
(formerly Provisional Intergovernmental Committee for the Movement of Migrants for Europe and Intergovernmental Committee for European Migration)
10335 of March 28, 1952
International Pacific Halibut Commission 11059 of October 23, 1962
International Secretariat for Volunteer Service 11363 of July 20, 1967
International Telecommunications Satellite Organization (INTELSAT) 11718 of May 14, 1973 and 11966 of January 19, 1977
International Telecommunication Union 9863 of May 31, 1947
International Union for Conservation of Nature and Natural Resources (Limited Privileges) 12986, January 18, 1966
International Wheat Advisory Committee (International Wheat Council) 9823 of January 24, 1947
Interparliamentary Union 13097 of August 7, 1998
Israel-United States Binational Industrial Research and Development Foundation 12956 of March 13, 1995
ITER International Fusion Energy Organization 13451 of November 19, 2007
Korean Peninsula Energy Development Organization 12997 of April 1, 1996
Multilateral Investment Guarantee Agency 12467 of August 22, 1988
Multinational Force and Observers 12359 of April 22, 1982
North American Development Bank 12904 of March 16, 1994
North Pacific Anadromous Fish Commission 12895 of January 26, 1994
North Pacific Marine Science Organization 12894 of January 26, 1994
Organization for Economic Cooperation and Development (formerly the Organization for European Economic Cooperation) 10133 of June 27, 1950
Organization for the Prohibition of Chemical Weapons 13049 of June 11, 1997
Organization of American States (including Pan American Union) 10533 of June 3, 1954
Organization of Eastern Caribbean States 12669 of February 20, 1989
Pacific Salmon Commission 12567 of October 2, 1986
Pan American Health Organization (including Pan American Sanitary Bureau) 10864 of February 18, 1960
South Pacific Commission 10086 of November 25, 1949
United International Bureau for the Protection of Intellectual Property (BIPRI) 11484 of September 29, 1969
United Nations 9698 of February 19, 1946
United Nations Educational, Scientific, and Cultural Organization (UNESCO) 9863 of May 31, 1947
United Nations Industrial Development Organization 12628 of March 8, 1988
United States-Mexico Border Health Commission 11367 of December 21, 2004
Universal Postal Union 10727 of August 31, 1957
World Bank (see International Bank for Reconstruction and Development ) 9751 of July 11, 1946
World Health Organization 10025 of December 30, 1948
World Intellectual Property Organization 11866 of June 18, 1975
World Meteorological Organization 10676 of September 1, 1959
World Tourism Organization 125087 of March 22, 1985
World Trade Organization 13042 of April 9, 1997

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