21.6.2 Adjusting TIN-Related Problems

Manual Transmittal

September 12, 2019

Purpose

(1) This transmits a revised IRM 21.6.2, Individual Tax Returns, Adjusting TIN-Related Problems.

Material Changes

(1) Various editorial changes were made throughout this IRM and cross references were added, removed or revised as appropriate.

(2) Updated NOMRG to NMRG throughout.

(3) IRM 21.6.2.1 added Mixed Entity (MXEN) to information covered in this IRM.

(4) IRM 21.6.2.1.6 added acronyms.

(5) IRM 21.6.2.2 added reminder and links for ID Theft Procedures and added case types.

(6) IRM 21.6.2.3 added reminder to not send NUMIDENT to the taxpayer.

(7) IRM 21.6.2.3.1 clarified UPC 134-3 NMRG condition.

(8) IPU 19U0585 issued 05-02-2019 IRM 21.6.2.3.1 clarified NMRG TDI/TDA Condition.

(9) IRM 21.6.2.3.3 Telephone Inquiries Regarding Mixed Entity (MXEN) and Scrambled SSN (SCRM) Cases, moved from 21.6.2.4.5.

(10) IRM 21.6.2.3.4 Reassignment of NMRG Cases Due to Site Specialization, moved from IRM 21.6.2.4.1.5.

(11) IPU 18U1459 issued 11-15-2018 IRM 21.6.2.4.1 added note, merge transactions cannot post cycle 48 through cycle 4.

(12) IPU 19U0585 issued 05-02-2019 IRM 21.6.2.4.1 added use of CC MFREQ to activate CC ENMOD.

(13) IRM 21.6.2.4.1.1 if a taxpayer has two or more social security numbers they should contact SSA to determine which one they should be using for tax purposes.

(14) IPU 18U1459 issued 11-15-2018 IRM 21.6.2.4.1.1 moved note concerning merge transactions not posting cycle 48 through cycle 4.

(15) IRM 21.6.2.4.1.2 EP, PN and RS are pending transactions.

(16) IPU 19U0585 issued 05-02-2019 IRM 21.6.2.4.1.3 clarified indicators on RTS when the ITIN has been revoked and added instructions for when the ITIN cannot be revoked.

(17) IRM 21.6.2.4.2 added Mixed Entity Procedures, moved from IRM 25.23.4.9. All subsequent sections renumbered.

(18) IRM 21.6.2.4.3 moved Scrambled SSN Procedures from IRM 21.6.2.4.2.

(19) IRM 21.6.2.4.3 all preliminary research to find a TIN for each taxpayer and the owner of the common number (CN) should have been exhausted and a determination of a True/Default True Scrambled SSN made before beginning scrambled SSN procedures.

(20) IRM 21.6.2.4.3.1 removed section, Identifying Scrambled Cases Involving Taxpayer Inquiries or NOMRG Transcripts.

(21) IRM 21.6.2.4.3.3 removed section, Scrambled Procedures Specific to Cases Other Than True/Default True Scrambled SSN Cases.

(22) IRM 21.6.2.4.3.6 removed procedures for non True/Default True SSN cases.

(23) IRM 21.6.2.4.3.7 removed procedures for non True/Default True SSN cases.

(24) IRM 21.6.2.4.3.9 updated SCI 23 to SCI 13.

(25) IRM 21.6.2.4.3.10 forward a list of cases closed without an SSA Form 3857 response to the IDTVA Scrambled SSN P&A Analyst.

(26) IRM 21.6.2.4.3.15 account move conditions for NMRG cases moved to IRM 21.6.2.4.6.

(27) IPU 18U1459 issued 11-15-2018 IRM 21.6.2.4.3.17 added note, TC 971/001 cannot post to a Revoked ITIN.

(28) IRM 21.6.2.4.4 NMRG Procedures moved from 21.6.2.4.3.

(29) IRM 21.6.2.4.5 REVAL Transcript Procedures moved from 21.6.2.4.4.

(30) IRM 21.6.2.4.6 through IRM 21.6.2.4.6.2 added account move conditions and procedures.

Effect on Other Documents

IRM 21.6.2, Individual Tax Returns, Adjusting TIN-Related Problems, dated August 20, 2018 (effective October 1, 2018) is superseded. This IRM also includes IRM Procedural Updates (IPUs) 18U1459 issued 11-15-2018 and 19U0585 issued 05-02-2019.

Audience

All employees performing account/tax law work

Effective Date

(10-01-2019)


Karen A Michaels
Director, Accounts Management
Wage and Investment Division

Adjusting TIN-Related Problems Scope and Objectives

  1. Purpose: This IRM covers information on TIN related problems - Resequencing Accounts, Mixed Entity (MXEN), Scrambled Social Security Numbers (SCRM), No Merge (NMRG) and Reversed Validity (REVAL) Transcripts. This section covers the identification and resolution of TIN related problems.

  2. Audience: The primary users of this IRM are all employees in Business Operating Divisions (BOD) who are in contact with taxpayers by telephone, correspondence or in person.

  3. Policy Owner: The Director of Accounts Management.

  4. Program Owner: Process and Program Management, Accounts Management, Wage and Investment (WI).

  5. Primary Stakeholders: The primary stakeholders are organizations that Accounts Management collaborates with, for example; Return Integrity and Compliance Systems (RICS), Compliance and Submission Processing.

  6. Program Goals: Program goals for this type of work are included in the Accounts Management Program Letter as well as IRM 1.4.16, Accounts Management Guide for Managers.

Background

  1. Employees in the Accounts Management (AM) organization respond to taxpayer inquiries and phone calls as well as process claims and other internal adjustment requests.

Authority

  1. Refer to IRM 1.2.1, Policy Statements for Customer Account Services Activities, for information.

Responsibilities

  1. The Wage and Investment Commissioner has overall responsibility for policy related to this IRM. Information is published in this IRM on a yearly basis.

  2. Additional information is found in IRM 1.1.13.7.3, Accounts Management (AM), and IRM 21.1.1, Accounts Management and Compliance Services Overview.

Program Management and Review

  1. Program Reports: The program reports provided in this IRM are for identification purposes for the Accounts Management Customer Service Representatives (CSRs) and Tax Examiners (TEs). For reports concerning quality, inventory and aged listings, please refer to IRM 1.4.16, Accounts Management Guide for Managers. Aged listings can also be viewed by accessing Control Data Analysis, Project PCD, on the Control-D/Web Access server, which has a login program control.

  2. Program Effectiveness: Program Effectiveness is determined by Accounts Management’s employees successfully using IRM guidance to perform necessary account actions and duties.

Program Controls

  1. Program Controls: Goals, measures and operating guidelines are listed in the yearly Program Letter. Quality data and guidelines for measurement is referenced in IRM 21.10.1, Embedded Quality (EQ) Program for Accounts Management, Campus Compliance, Field Assistance, Tax Exempt/Government Entities, Return Integrity and Compliance Services (RICS) and Electronic Products and Services Support.

Acronyms

  1. For a comprehensive listing of any IRS acronyms, please refer to the Acronym Database.

  2. Some of the acronyms used in this IRM:

    Acronym Definition
    ATIN Adoption Taxpayer Identification Number
    ASED Assessment Statute Expiration Date
    BFS Bureau of the Fiscal Service
    CC Command Code
    CDS Centralized Delivery Service
    CN Common Number
    HQ Headquarters
    IDRS Integrated Data Retrieval System
    IDTVA Identity Theft Victim Assistance
    IMF Individual Master File
    IRC Internal Revenue Code
    IRSN Internal Revenue Service Number
    ITIN Individual Taxpayer Identification Number
    ITRVK ITIN Revoke
    MFR Mail Filing Requirement
    MXEN Mixed Entity
    MXSP Mixed Entity Spanish
    NC Name Control
    NMRG No Merge
    POC Point of Contact
    REVAL Revalidation
    RTS Real Time System
    SCI Scrambled SSN Indicator
    SCRM Scrambled SSN
    SSA Social Security Administration
    SSN Social Security Number
    TC Transaction Code
    TDA Taxpayer Delinquency Account
    TDI Taxpayer Delinquency Investigation
    TIN Taxpayer Identification Number
    UPC Unpostable Code

Related Resources

  1. For help working TIN-Related problem cases you may need to refer to:

    • IRM 3.13.5, Individual Master File (IMF) Account Numbers

    • IRM 3.21.263, IRS Individual Taxpayer Identification Number (ITIN) Real Time System (RTS)

    • IRM 25.23.4, IDTVA Paper Process.

  2. The IRS adopted the Taxpayer Bill of Rights in June of 2014. Employees are responsible for being familiar with and acting in accord with taxpayer rights. See IRC Section 7803(a)(3) or Taxpayer Bill of Rights, on www.IRS.gov for additional information.

What Are TIN-Related Problems?

  1. TIN-related problems involve moving taxpayer information from one TIN to another or from one segment of a TIN to another. Actions are required on the Entity and/or tax module to correct TIN-related problems.

    Reminder:

    For Identity Theft (IDT) Paper cases, see IRM 25.23.4.3, Identity Theft General Research. For phone calls indicating Identity Theft see IRM 25.23.12.3, Identity Theft Telephone General Guidance.

  2. Case types addressed in this section include:

    • Resequencing Accounts - One taxpayer has two TINs or two segments of the same TIN that need to be merged

    • Mixed Entity (MXEN) and Mixed Entity Spanish (MXSP) - Two taxpayers file a return with the same TIN, ownership determination can be made and no ID Theft is indicated

    • Scrambled SSN (SCRM) - Two taxpayers were given the same Social Security Number (SSN) by the Social Security Administration (SSA)

    • No Merge (NMRG) - One taxpayer has two TINs that need to be merged but a NMRG Condition exists preventing the merge

  3. This section addresses all TIN types unless otherwise indicated. TIN types are:

    • Social Security Number (SSN), see IRM 3.13.5.21, Social Security Number (SSN) Format

    • Individual Taxpayer Identification Number (ITIN), see IRM 3.13.5.22, Individual Taxpayer Identification Number (ITIN) Format

    • Internal Revenue Service Number (IRSN), see IRM 3.13.5.23, Internal Revenue Service Number (IRSN) Format

    • Adoption Taxpayer Identification Number (ATIN), see IRM 3.13.5.24, Adoption Taxpayer Identification Number (ATIN) Format

  4. See IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria, to determine if the case should be referred to TAS. See IRM 21.1.3.18, Taxpayer Advocate Service (TAS) Guidelines, for additional information.

TIN-Related Problems Research

  1. TIN information for SSNs and ITINs may be posted on the valid or invalid segment of Master File. IRSNs are temporary numbers issued by the IRS and are always on the invalid segment of Master File. The invalid segment is indicated by an asterisk (*) following the last digit of the TIN. It is necessary to address both the valid and invalid segments of Master File when adjusting TIN related problems. For additional information see IRM 3.13.5.12, Valid and Invalid Segment for the Individual Master File (IMF).

  2. To correct TIN-related problems, you must be familiar with the following research elements:

    • Entity module

    • Transaction codes

    • Retention register - Request a retention register transcript only if the account cannot be reactivated by using command code IMFOL with definer "B."

    • IDRS Command Codes (CC), including but not limited to, NAMES, INOLE, IRPTR, DDBKD, DUPOL, MFTRA, IMFOL, RTVUE, TRDBV, FFINQ, REINF, with various definers

    • NUMIDENT (for SSN research only)

      Caution:

      NUMIDENT is for internal use only. Never send it to the taxpayer.

  3. The research necessary for accurately processing a TIN-related problem case includes, where applicable, and is not limited to the following systems:

    • The Correspondence Imaging System (CIS) to research all related cases and attached documents

      Caution:

      Whenever possible, multiple claims from the same taxpayer should be processed by the same employee. Coordination of same taxpayer, multi-year claims is necessary to ensure consistent processing. See IRM 21.5.2.3, Adjustment Guidelines - Research, for additional information.

    • ITIN Real Time System (RTS) to research and review data related to assigned, suspended and/or rejected Form W-7, Application for IRS Individual Taxpayer Identification Number. See IRM 3.21.263.5.7, Status Codes, IRM 3.13.5.81.7, Accessing the ITIN Real Time System (RTS), and IRM 3.21.263.9, General Instructions for ITIN Navigation (ITIN RTS), for additional information.

      Note:

      The Form W-7 application's Document Locator Number (DLN) is only available on RTS.

    • Accounts Management Services (AMS) to research all prior taxpayer contacts.

  4. Research for:

    • Number of years the TIN has been used for filing returns

    • Previous names

    • Filing status changes

    • Method of filing, electronic or paper

    • Previous adjustments

    • Previous addresses

    • Filing dates of original and duplicate returns

    • TC 971 Transaction Codes

    • All related TINs for all tax years

    • Dependents

    • Income information

    • Employer information

    • Schedules and forms filed

    • Date of birth

    When working ITIN cases, you must also research under the relevant SSN used for income reporting.

  5. When two or more taxpayers are involved, make every effort to locate the correct TIN for each taxpayer before contacting them.

  6. Do not determine the validity of a social security card on the basis of the word "VOID" on the photocopy. Placing the word "VOID" on a photocopy of a recently issued social security card simply indicates that the document is a photocopy of the original card.

  7. When resolving TIN related problems, you may also need to refer to IRM 3.13.5, Individual Master File (IMF) Account Numbers, IRM 3.21.263, IRS Individual Taxpayer Identification Number (ITIN) Real Time System (RTS), and IRM 25.23.4.3, Identity Theft General Research.

NMRG Conditions

  1. Research may show an OPEN control base on CC TXMOD or CC ENMOD. ALWAYS contact the employee with the open control base prior to taking any actions on the account.

    Caution:

    If there are any "NMRG" controls, do not take any account actions. Refer as appropriate.

  2. Use caution when moving accounts. Improper attempts to resequence accounts when a NMRG condition is present causes the merge to fail and a NMRG transcript to generate.

  3. The following conditions must be resolved before resequencing an account:

    Exception:

    If merging from one TIN to another and none of the conditions below exist but monitoring is required, Toll-Free Assistors and TAC Employees will send a Form 4442 Referral to the Campus AM paper function within their Directorate. Use "Merge Request" as the referral type. Provide the caller with a 30 day timeframe for contact. Do not refer to NMRG unless conditions in (4) also exist.

    • Either account contains Mail Filing Requirement (MFR) 08 and Scramble Indicator (SCI) 01, 10, 12, 13, 20 or 23. Reassign CIS case as SCRM. Toll-Free Assistors will initiate a Form 4442 Referral to the IDTVA SCRM Unit. See IRM 21.6.2.3.3, Telephone Inquiries Regarding Mixed Entity (MXEN) and Scrambled SSN (SCRM) Cases.

    • Either account contains an unreversed TC 914, 916, or 918 (Z Freeze). See IRM 21.5.6.4.52, -Z Freeze.

    • For Mixed Entity cases see IRM 21.6.2.3.3, Telephone Inquiries Regarding Mixed Entity (MXEN) and Scrambled SSN (SCRM) Cases.

  4. Employees working CIS cases, with the following conditions on the accounts, will reassign the case through CIS. Toll-Free Assistors and TAC employees will initiate a Form 4442 Referral to NMRG. See IRM 21.6.2.3.4, Reassignment of NMRG Cases due to Site Specialization.

    • A TC 150 for the same tax period is posted on both the "from" and "to" accounts.

    • Either account contains a module with an M- Freeze and there is a module for the same tax period on the other account.

    • One account contains a module with a -Q Freeze and the other account contains a module for the same tax period which either contains an unreversed TC 570 or is in a debit balance status.

    • Both accounts contain a module for the same tax period with a -V Freeze (unless one or both TC 520(s) has a closing code 81).

    • Both accounts contain an unreversed TC 930 or 424 on the same tax period or one account contains an unreversed TC 930 and the other account contains an unreversed TC 424.

    • The "from" account contains an unreversed TC 898 posted within the last six years on CC TXMOD or a UPC 134-3 on CC ENMOD.

    • Both modules contain an unreversed TC 608 on MFT 55.

    • Both accounts contain an MFT 32 module for the same tax period.

    • Both accounts contain a module in Taxpayer Delinquency Investigation (TDI) Status 03 (indicator other than 08) and/or Taxpayer Delinquency Account (TDA) Status 22, 24, 26 or 60 and the Primary Location Codes are not in agreement.

    • Either account contains more than 25 active modules.

Determining Validity

  1. If the primary TIN and name control (NC) do not match (invalid), they are identified by an asterisk "*" after the TIN.

  2. On IMF Retention Register Microfilm transcripts, the computer assigns a validity digit of "0" when TIN and NC match (valid). A validity digit of "1" is assigned when TIN and NC do not match.

  3. When the DM-1 data tape file is received, it is systemically compared to the invalid segment of MF.

    1. Any change in an account's validity causes a resequence under TC 001 and generates a Document Locator Number (DLN) of 00200–000–00006–0.

    2. A residual record is maintained on the invalid segment after an account is resequenced.

    3. The TIN slot is reserved until released by a returning memo record (TC 026) or the account fails to merge.

    Note:

    For additional information see IRM 3.13.5.14, Data Master One (DM-1) File, and IRM 3.13.5.12.1, IMF Segmentation of Valid/Invalid Accounts.

  4. Resequencing created by entity transactions is accomplished by a name change (TC 013) or a TIN change (TC 011) to MF.

    1. A residual record is maintained on the "from" segment after the account is resequenced.

    2. The TIN slot is reserved until released by a returning memo record (TC 026) or account fails to merge.

  5. Resequenced accounts which fail to merge, return to their original validity slots.

    1. Memo transactions (TC 026), resequencing to release the hold on residual account slots, are directed to the valid segment of MF from which the originating account came without regard to a match with SSA data.

    2. When accounts do not merge, a transcript generates for both accounts involved and the TC 026 transaction does not post.

    Note:

    If the accounts fail to merge when DLN of 00200–000–00006–0 generates, the computer no longer recognizes the invalid segment. Adjustments made to the invalid TIN automatically post to the valid TIN. An Internal Revenue Service Number (IRSN) must be obtained and the valid or invalid TIN is moved to the IRSN.

  6. Taxpayer accounts with the "NEWSSA N/C" literal may be valid accounts residing on the invalid segment of IMF. However, all NEW SSA N/C, IRS VALID and ATIN accounts reside on the invalid segment until completion of the quarterly DM-1 merges.

    Note:

    The quarterly updates of the DM-1 File are done in January, April, July and November of each year.

    The quarterly merges are scheduled in cycles 05, 15, 31 and 44. For additional information see IRM 3.13.5.16, Weekly NEW SSA Name Control (N/C) Indicator Files.

Telephone Inquiries Regarding Mixed Entity (MXEN) and Scrambled SSN (SCRM) Cases

  1. A mixed entity case or scrambled SSN case controlled on IDRS can be identified by control categories MXEN, MXSP SCRM or SSA2. Toll-Free Assistors must not make adjustments or take any account actions on open controlled mixed entity or scrambled SSN accounts.

    • Do Not input address change(s) on the account(s).

    • Do Not release overpayment(s) held on the account(s). If the taxpayer is claiming a hardship, refer the case to the Taxpayer Advocate Service (TAS) for hardship determination per IRM 21.4.4.3, Why Would a Manual Refund Be Needed?

    • Do Not attempt to resequence the account(s).

    • Do Not attempt to unscramble the account(s).

    • Do Not input adjustments.

    • Do Not release freeze conditions on the account.

    Note:

    If the caller indicates they may be a victim of identity theft, refer to IRM 25.23.12.3, Identity Theft Telephone General Guidance, and the related subsections for information and guidance.

  2. If a Letter 239C has been sent and the taxpayer has not responded, advise the taxpayer to complete the questionnaire and return it with all the documentation requested. See IRM 21.6.2.4.3.3, Determining if the Refund Should be Released, for required documentation.

  3. On open cases, regardless of the result of the disclosure probes performed in IRM 21.1.3.2.3, Required Taxpayer Authentication, you cannot give out specific account information on the common number (CN) unless the taxpayer passes additional authentication. For additional information, see IRM 21.1.3.2.4, Additional Taxpayer Authentication. If the caller fails additional taxpayer authentication, you can provide general information on procedures and processing times. You can also accept information about which returns the caller filed.

    Caution:

    Do not assume that the taxpayer calling is the true owner of the SSN. Determine if you are speaking with the taxpayer who filed the TC 150 or the TC 976 by asking questions related to the appropriate return and data on IDRS. The true owner of the SSN can only be determined by a CSR/TE who has been trained in working TIN-Related Problem cases and who makes the determination after all necessary research steps are taken. As a CSR on the toll-free line, you may have the experience to work TIN-Related Problem cases, but your duties on the toll-free line do not allow the extended amount of time necessary to perform complete research.

  4. When appropriate, Toll-Free Assistors should prepare Form 4442 to refer taxpayer inquiries regarding open mixed entity and scrambled SSN cases to the controlling CSR (example: if this is the taxpayer’s first time calling and the required processing time frame has passed). To assist with the resolution of the case, obtain all pertinent information from the caller, including the following:

    • Whether the caller is responding to a letter or notice; for example, Letter 239C

    • The date the letter was issued

    • A telephone number(s) where the taxpayer can be reached and the best time for us to reach them

    • The current address, which may be the same as the address on the SSN owner’s return

    • Information on whether the caller's return was filed electronically or by paper

    • The date the caller’s return was filed and the amount of refund expected

    • Other pertinent information on the return that will assist the employee in resolving the case

    Example:

    If the TIN was used by more than one family member, notate the name and correct TIN for each individual on Form 4442.

    Note:

    Also enter a case note on CIS as follows "4442 present - Check AMS History".

    Note:

    Do not prepare Form 4442 referral if this is the taxpayer's first time calling and the processing time frame has not passed. If the taxpayer is calling only to check on the status of their refund/claim and no additional information is provided, then provide an update on the status of the case based on your research and CIS case notes.

    Reminder:

    You cannot provide specific details on the case, but you can utilize CIS cases notes to provide an expected time frame for resolution of the case.

  5. If a referral is required on a MXEN/MXSP case while staffing the AM toll-free telephone line, or if you are located in a Taxpayer Assistance Center (TAC), prepare Form 4442, Inquiry Referral, as follows:

    If there is... Then refer Form 4442 to...
    An open control The employee with the open control.

    Note:

    Do not refer cases with IDRS numbers listed as temporary holding numbers in AM Site Specialization Temporary Holding Numbers. These are temporary holding numbers that are used as a result of the Site Specialization Process. For cases assigned to a temporary holding number, use the procedures below related to "no open control cases."

    Reminder:

    Open control cases should be referred to the site where the open control resides.

    No open control (The case is not assigned to an employee or is assigned to a temporary holding number.) To the local campus AM paper function in your directorate.
  6. If a referral is required on a Scrambled SSN case, prepare Form 4442 as follows:

    If there is... Then refer Form 4442 to...
    An open control to an employee The employee with the open control.

    Note:

    Do not refer cases with IDRS numbers listed as temporary holding numbers on the AM Site Specialization Temporary Holding Numbers. These are temporary holding numbers that are used as a result of the Site Specialization Process. For cases assigned to a temporary holding number, use the procedures below

    Reminder:

    Open control cases should be referred to the site where the open control resides.

    An open SCRM control to a holding number or there is a Scrambled SSN Indicator on CC INOLES To the Inventory Control Manager (ICM). The fax number is 855-433-2907 (for internal use only). Address the fax to "IDTVA ICM," and in the notes section of the fax cover sheet indicate "SCRM" .

    Caution:

    A referral should only be faxed to the IDTVA ICM if there is no open control to an employee but there is a SCRM control or a Scrambled SSN Indicator on the account and the taxpayer is providing additional information that will assist in the resolution of the case. All other referrals will be rejected back to the originator.

  7. If the case is closed/resolved, you may provide account information to the TIN owner utilizing normal procedures. You may provide the TIN owner with the information from his/her return(s) only. Do not provide the TIN owner with information from returns belonging to other individuals (the mixed entity or scrambled SSN returns).

  8. Low Income Taxpayer Clinics (LITCs) are independent from the IRS. They may be able to assist low income taxpayers in resolving issues with the IRS involving a mixed entity or scrambled SSN case. LITCs may also provide information in different languages about taxpayer rights and responsibilities for individuals who speak English as a second language. If appropriate, notify the taxpayer about the availability of LITCs. Refer the taxpayer to Publication 4134, Low Income Taxpayer Clinic List.

Reassignment of NMRG Cases Due to Site Specialization

  1. Cases involving certain merge issues are worked by the designated specialized sites. There are two types of cases involving merge issues:

    • Failed merge attempt, i.e., cases that generate a NMRG or REVAL transcript.

    • Potential NMRG cases identified prior to any attempted merge as indicated in IRM 21.6.2.3.1, NMRG Conditions.

  2. Reassignment to the Centralized Distribution Numbers (CDS) holding number is performed systemically for cases that generate a NMRG or REVAL transcript. Refer to the AM Site Specialization Temporary Holding Numbers listing for the appropriate number.

  3. Reassignment of potential NMRG cases to the NMRG CDS holding number is performed manually. Refer to the AM Site Specialization Temporary Holding Numbers listing for the appropriate number.

    Note:

    Prior to sending the case to the holding number, you must notate the NMRG condition on the CIS case, update the doc type to No Merge, the category code to NMRG, and the program code to 710–40053.

     

  4. If referring the case using Form 4442/e-4442, use No Merge (NMRG) as the reason for the referral and Brookhaven as the site. In AMS the referral will be submitted electronically. If talking with the taxpayer, provide the NMRG timeframe of 150 days. Notate the timeframe provided and the NMRG condition on the Form 4442.

  5. If you do not have access to AMS, fax the Form 4442 to Brookhaven IDTVA at 855-425-6975 (for internal use only). Address the Fax to Brookhaven IDTVA NMRG, and in the notes section of the fax cover sheet indicate NMRG/Potential NMRG. In the Form 4442 remarks section include a complete description of the reason for the referral.

    Caution:

    If a referral is routed to the NMRG unit that does not meet NMRG referral criteria and does not include all required information, it will be rejected back to the originator. The NMRG employee will annotate the reason for the rejection on the 4442.

    Reminder:

    If there is an open control on CIS, and you have access, do not send a referral. Leave a CIS case note with all the relevant information.

TIN-Related Problems Procedures

  1. The procedures in the following subsections should be used to correct TIN-related problems.

    Caution:

    If there are any "NMRG" controls, on CC TXMOD or CC ENMOD, do not take any account actions. Refer as appropriate.

  2. For ITIN Merge Procedures the ITIN Merge Guide, may be helpful.

Resequencing Accounts

  1. When an account moves from one TIN to another TIN or from one segment of a TIN (valid or invalid) to the other segment, it is called resequencing or merging. Resequencing or merging should not be attempted for scenarios where the individual accounts of two taxpayers are involved such as a husband and wife, parent and child, sister and brother, two unrelated people etc.

    Note:

    See IRM 21.6.2.3.1, NMRG Conditions, to determine if conditions are present that would prevent a merge. If the case meets reassignment to NMRG criteria, do not take any action on the account. See IRM 21.6.2.3.4, Reassignment of NMRG Cases due to Site Specialization.

  2. The following entity transaction codes (TC) apply to resequencing accounts:

    Caution:

    If TC 011, 013, 040 or 041 are preceded by EP, PN or RS, do not input another merge transaction.

    See Document 6209 Section 14 - Integrated Data Retrieval System (IDRS) 7 - Pending Transaction Identification Codes/IDRS Merge Related Transaction Codes, for additional information.

    TC Input to change
    011 TIN on a Master File (MF) account or to consolidate two accounts. This transaction is systemically compared against the DM-1 data file. On CC INCHG, input only the new TIN. It will move the entire account. Input the transaction only once. For additional information see IRM 3.13.5.116, Taxpayer Identification Number (TIN) Changes (generates a TC 011).
    013 Name on a MF account. This transaction is systemically compared against the DM-1 data file. For additional information see IRM 3.13.5.118.2, Completing Name Changes with CC INCHG/IAT. If multiple name changes need to be input, monitor for each one to post before inputting the next one.
    040 TIN or name on an account which is on the valid segment of MF. It is not systemically compared against the DM-1 data file. For additional information see IRM 3.13.5.125, Valid Segment Entity Bypass (TC 040). Input only once.
    041 TIN or name on an account which is on the invalid segment. It is not systemically compared against the DM-1 data file. For additional information see IRM 3.13.5.126, Invalid Segment Bypass (TC 041). Input only once.

    Note:

    Merge transactions will not post and accounts will not resequence between cycle 48 and cycle 4.

    Note:

    DM-1 explanation can be found in IRM 3.13.5.14, Data Master One (DM-1) File.

    Caution:

    Resequencing an account to a valid TIN or to an IRSN, even if the attempt fails, can release an overpayment not held with a TC 570 or TC 576 on any active module under the TIN being moved. An I- freeze only restricts credit interest. It does not hold the credit. Reminder: A TC 570 cannot post to an invalid account where the DLN 00200-000-00006-0 has posted. Other methods must be used to hold the credit. Open a control with the activity “HOLDREFUND” so that Notice Review will stop the refund.

  3. CC ENMOD must be active to input the above entity updates. If CC ENMOD is not available use CC MFREQ. See the COMMAND CODE MFREQ/RECON JOB AID.

  4. For additional information see IRM 3.13.5.25, Transaction Codes Used to Merge Accounts.

  5. TC 040 and TC 041 corrections do not go through the DM-1 validation process. Therefore, it is important to use TC 040 and TC 041 ONLY when the taxpayer provides proof of their identity AND it is necessary to bypass the DM-1 validation. The need to input TC 040 and TC 041 should be rare.

Resequencing Methods
  1. Resequencing on the Individual Master File (IMF) is often involved with the validity of a TIN.

    1. Each person may have only one TIN.

    2. Once a number is assigned, it cannot be assigned to someone else. A SSN is never "recycled" or reused.

      Note:

      If a taxpayer has more than one SSN advise them to contact SSA, if they have not already done so, to determine which SSN they should be using to file their tax returns.

    3. A transposition error in a TIN or name change, without notification to the Social Security Administration (SSA), may cause a TIN mismatch with IRS records. This is referred to as an "invalid" condition.

    4. The computer cross references all TINs to the SSA data and identifies invalid conditions.

  2. Resequencing accounts is accomplished by the following methods:

    • Automatic resequencing

    • Inputting a name control and name line change

    • Updating the new SSN field

    Caution:

    If TC 011, 013, 040 or 041 are pending on CC ENMOD, preceded by EP, PN or RS, do not input another merge transaction.

Resequencing Action Required
  1. These procedures should be followed when resequencing the invalid segment to the valid, the valid segment to the invalid or from one TIN to another.

    Reminder:

    If the module has already been resequenced, the message "MEMO MODULE" will appear on CC TXMOD.

  2. Research for no merge conditions. See IRM 21.6.2.3.1, NMRG Conditions.

    Reminder:

    If monitoring is required, Toll-Free Assistors and TAC Employees will not input the merge transaction. They will send a Form 4442 Referral to the Campus AM paper function within their Directorate. Use "Merge Request" as the referral type. Provide the taxpayer with a 30-day timeframe. See IRM 21.3.5.4.1, When to Prepare a Referral, for additional information.

  3. Research IMFOL for the valid and invalid accounts for both TINs (the "to" and "from" TINs) prior to resequencing an account. The resequencing action moves all tax periods present in the account. Specific tax periods cannot be moved independently.

    Caution:

    If TC 011, 013, 040 or 041 are pending on CC ENMOD, preceded by EP, PN or RS, do not input another merge transaction.

    If all modules do not belong to the same taxpayer do not merge the accounts.

  4. Reinstate all recoverable lower level modules dropped to retention in 1994 and later using Command Code (CC) IMFOLB. See IRM 2.3.51.4, Restoring RRR Tax Modules to Master File.

    Exception:

    If reinstatement of modules will result in 25 or more active modules on the "from" account, do not reactivate any modules. Instead, refer the case to NMRG. See IRM 21.6.2.3.4, Reassignment of NMRG Cases Due to Site Specialization.

  5. Vestigial modules, dropped to retention prior to 1994 and unrecoverable modules, should only be reinstated if there is a module for the same year on both the "to" and "from" accounts. This is a NMRG condition and must be reassigned to NMRG. See IRM 21.6.2.3.4 , Reassignment of NMRG Cases due to Site Specialization.

  6. Do not input the resequencing transaction until the reinstatements are complete.

  7. If the return posted to the invalid segment of the same TIN because of a name control mismatch, follow the appropriate procedures in IRM 3.13.5.118, Correcting a Taxpayer’s Name.

    Exception:

    If monitoring is required Toll-Free and TAC Assistors will send a referral to the AM paper function within their directorate.

  8. If the return posted to the invalid segment of a different TIN, see IRM 3.13.5.116, Taxpayer Identification Number (TIN) Changes (generates a TC 011).

  9. When resequencing an ITIN to another ITIN, see IRM 3.21.263.8.5, Merges Involving ITIN, to determine which number should be the "from" account and which should be the to account. Revoke the ITIN for the "from" account per the instructions in IRM 21.6.2.4.1.3, ITIN to SSN Name Controls Match, (5) through (8), after all transactions have posted.

ITIN to SSN Name Controls Match
  1. Before following these procedures research for no merge conditions. See IRM 21.6.2.3.1, NMRG Conditions.

  2. Research the status of the ITIN on CC INOLES in the upper right part of the screen. If the ITIN is active (A) or inactive (I), on CC INCHG, input only the new SSN. If the ITIN has been revoked, no indicator is present, input the new SSN with TC 040.

    Note:

    If the ITIN is active (A) or inactive (I) it will need to be revoked after the merge to the SSN is complete.

  3. Resequence the ITIN whether it belongs to the primary taxpayer or secondary taxpayer. If both the primary and secondary taxpayers have ITINs that need to be consolidated, resequence both ITINs.

    Note:

    If there are tax years on CC IMFOLI under the ITIN, the account needs to be resequenced. If any modules are in retention see IRM 21.6.2.4.1.2, Resequencing Action Required.

  4. If the ITIN being merged is for the primary, after the ITIN has merged to the SSN, update the ITIN on the CIS case to the new SSN. There will be two controls on the new SSN that appear to be for this CIS case. The one with the same control number as the open CIS case will be the valid control. The other one is from when the account merged and will need to be manually closed.

  5. After the merge to the SSN is complete, route Form 4442 to the Submission Processing Center (SPC) ITIN Unit to request the revocation of the ITIN. Complete a Form 4442 from the primary account for each ITIN associated with the case and being revoked; primary, secondary and dependents. See IRM 3.21.263.8.6, Form 4442, Inquiry Referral, for information required on, and documentation to be attached to, the Form 4442.

  6. To monitor for the revocation, establish a new control on IDRS under the primary account. Use activity code ITRVK, status code M, category code MISC and the current date for the received date.

  7. After all required actions have been taken on the SSN the CIS case can be closed.

  8. Once all related ITINs have been revoked and posted to RTS (the Status on RTS will be "rejected" and/or the Reason Code will be "R15" ) close the "MISC" base.

    Note:

    Allow up to 2 weeks for the revocation to post. If it does not post, resubmit the Form 4442. Ensure the Form 4442 is completed correctly and any required attachments are included before resubmitting the Form 4442. See IRM 3.21.263.8.6, Form 4442, Inquiry Referral. If after another two weeks the ITIN is still not revoked, elevate the issue to your local P&A.

    Note:

    If the ITIN Unit responds indicating the ITIN cannot be revoked due to a systemic issue with RTS, add a note to the CIS case or AMS and close the monitor control on IDRS.

ITIN to SSN Name Control Mismatch
  1. Research for no merge conditions. See IRM 21.6.2.3.1, NMRG Conditions.

  2. If the name on the ITIN and the name on the SSN are both valid, update the name on the ITIN.

    1. On CC INCHG include, the new name control, new name line, year name line and filing status.

    2. Monitor for the ITIN to move to the invalid segment.

    3. Update the invalid segment of the ITIN with the new SSN.

  3. For additional information see IRM 3.13.5.118, Correcting a Taxpayer’s Name.

  4. After the merge is complete, follow paragraphs 4 through 8 in IRM 21.6.2.4.1.3, ITIN to SSN Name Controls Match.

  5. Resequence the ITIN whether it belongs to either the primary taxpayer or the secondary taxpayer. If both primary and secondary taxpayers have ITINs that need to be consolidated, resequence both ITINs.

    Note:

    If there are tax years on CC IMFOLI under the ITIN, the account needs to be resequenced. If any modules are in retention see IRM 21.6.2.4.1.2, Resequencing Action Required.

Mixed Entity Procedures

  1. A mixed entity case is created when two taxpayers file a return with the same TIN, also known as the common number (CN). Normally, this condition is identified while working CP 36, Duplicate/Amended Filing Conditions, transcripts. Because an external data breach return can be identical or similar, also refer to IRM 25.23.4.4.2, Required Actions on All Identified IDT Cases, for additional items to review to prevent the mishandling of an IDT case.

    Note:

    If ID Theft is indicated, see IRM 25.23.4.5.3.1, Additional Actions Required by All.

  2. If common number ownership cannot be determined see IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number.

Resolving Mixed Entity Cases
  1. Analyze the case and identify the correct and incorrect taxpayer for the common number (CN) as follows:

    1. Taxpayer "A" correctly used the TIN and remains on the CN.

    2. Taxpayer "B" incorrectly used the TIN. Taxpayer "B" s return will be input to a valid TIN, input to an Internal Revenue Service Number (IRSN), or nullified, depending on the results of research/taxpayer contact.

      Caution:

      Taxpayer "B" is moved to an IRSN only when it has been verified that the CN does not belong to Taxpayer "B" and a valid different number cannot be located.

      Example:

      Taxpayer "A" , John Smith, and Taxpayer "B" , Jane Smythe, are both using the CN. NUMIDENT indicates that the CN was assigned to John Smith. NUMIDENT does not indicate that the CN was ever assigned to Jane Smythe. Research and correspondence with Taxpayer "B" does not provide a valid TIN for Taxpayer "B" , Jane Smythe. Taxpayer "A" , John Smith, is the correct CN owner and would remain on the CN. Taxpayer "B" , Jane Smythe, is the incorrect taxpayer and would be moved to an IRSN.

       

      Caution:

      If Taxpayer "B" s return is to be reprocessed AND Taxpayer "B" s return shows a primary and a secondary taxpayer, research the secondary taxpayer's account to determine if a return has already been filed by the secondary taxpayer for the tax year at issue. If a return has been filed by the secondary taxpayer, resolve the duplicate filing issue before reprocessing Taxpayer "B" s return. Not resolving the duplicate filing issue will result in the generation of a CP 36F case. See IRM 21.6.7.4.5,Multiple Uses of Taxpayer Identification Numbers - CP 36F.

  2. If either account contains an offset (CRN 896 or CRN 898) to a state or federal agency, take no action before referring to IRM 21.4.6.4.2.4, Child Support TOP Offsets.

  3. Consider possible changes to the Return Processable Date (RPD). See IRM 21.5.6.4.17, I- Freeze.

  4. For mixed entity cases involving identity theft, see IRM 25.23.4.21.1.1, Identity Theft - More Than One Return Present.

Valid TIN Located - Taxpayer "A" Posted First
  1. The following procedures must be used when a valid different TIN is found for Taxpayer "B" and Taxpayer "A" posted first:

    1. Input TC 290 blocking series 00 and use Taxpayer "A" s return as the source document. Notate in remarks "Mixed Entity" .

      Note:

      If Taxpayer "A" s return is not present, input TC 290, blocking series 05, and "No Source Document (NSD)" to release the -A Freeze.

    2. Input TC 971 with action code 002. Enter Taxpayer "B" s TIN as a cross-reference. Refer to IRM 21.5.1.4.8,Transaction Code 971, for additional guidance.

    3. Update the entity on Taxpayer "A" s account if the original information has changed.

    4. Input TC 971 with action code 017 on Taxpayer "B" s account. Refer to IRM 21.5.1.4.8, Transaction Code 971, for additional guidance. Enter Taxpayer "A" s TIN as a cross-reference. If Taxpayer "B" s account is not yet established, input TC 000, monitor for it to post then input the TC 971 AC 017. Refer to IRM 3.13.5.115, Establishing a New Account (TC 000), for additional guidance.

    5. Transfer Taxpayer "B" s payments to his/her account.

    6. Take the appropriate steps to post Taxpayer "B" s tax information to the correct TIN. Refer to IRM 21.5.2.4.23, Reprocessing Returns/Documents, for additional information.

      Note:

      If a refund was issued from the CN to Taxpayer "B" , the refund transaction must be moved to Taxpayer "B" s TIN. See IRM 21.5.2.4.23.10, Moving Refunds. Maintain a monitored control base on IDRS on both accounts and monitor until all resulting transactions post correctly.

    7. If the taxpayer or the tax return preparer used an incorrect TIN, send a Letter 257C advising the taxpayer of the correct TIN to use. If Submission Processing (SP) processed the return using a different TIN, send a Letter 257C but do not mention the TIN SP edited on the return during processing.

Valid TIN Located - Taxpayer "B" Posted First
  1. The following procedures must be used when a valid different TIN is found for Taxpayer "B" and Taxpayer "B" posted first:

    1. Adjust the CN account to reflect Taxpayer "A" s return data using blocking series 00. If working on CIS, the adjustment is still input using blocking series 00 since Taxpayer "A" s return is considered the original return; however it should be input as a NSD.

    2. If Taxpayer "A" s return was received after the return due date, refer to IRM 20.2.4.5,Unprocessable Returns, and IRM 20.2.4.5.1,Updating the RPD on Unprocessable Returns. For the purpose of updating the RPD, this IRM section will be used for official guidance.

    3. If Taxpayer "A" has a balance due and failure to pay penalty is required, refer to IRM 20.1.2.2.6.3, Wrong Return Posted First, for additional guidance.

    4. Use priority code (PC) 1 if the return requires DIF scoring. See IRM 21.5.2.4.23.6, Discriminate Index Function (DIF) SCORE or CLASSIFICATION "Send Return(s) to Examination for Review" , for procedures.

    5. Use the appropriate hold code to prevent issuing erroneous notices and/or an erroneous refund to Taxpayer "A" . You must use hold code 4 when a manual refund is required.

    6. If Taxpayer "B" requested a direct deposit and the refund did not generate due to the TC 976, allow the TC 971 AC 001 to post before inputting the adjustment. This will prevent the refund from being direct deposited into Taxpayer "B" s account.

    7. See (2) below for ACA consideration if adjusting the 2014 tax year or later.

    8. Combat Zone (CZ) accounts, identified by a -C freeze, indicate a taxpayer who is, or was serving in a designated combat zone area. The -C freeze stays on the account even after the taxpayer is no longer in the CZ. When working an account that contains a -C freeze, additional research is required to determine the taxpayer's CZ status.

      1. Research CC IMFOLE for the Combat indicator on Line 11, to determine the correct action to take.

      2. If Combat indicator is "1," then the taxpayer is still serving in a combat zone. Any compliance activity such as assessing or collection of tax is prohibited. However, if the taxpayer has other issues or requests information, you may work these other issues and contact the taxpayer, if needed.

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

    9. If the First Time Home Buyer Credit (FTHBC) is involved and needs to be adjusted, see IRM 21.6.4.4.18.4, Manually Adjusting the Recapture Amount.

    10. Transfer Taxpayer "B" s payments to their correct account.

    11. Input TC 971 with action code 001. Enter Taxpayer "B" s TIN as cross-reference. Refer to IRM 21.5.1.4.8,Transaction Code 971, for additional guidance.

    12. Adjust the Assessment Statute Expiration Date (ASED), if necessary. Notate on CIS "DUP (DLN) (last 6 digits of the DLN xxxxx-x) becomes the original" .

    13. Correct the entity module to reflect Taxpayer "A" s current address.

    14. Input TC 971 with action code 017 on Taxpayer "B" s account. Refer to IRM 21.5.1.4.8,Transaction Code 971, for additional guidance. Enter Taxpayer "A" s TIN as a cross-reference. If Taxpayer "B" s account is not yet established, input TC 000, monitor for it to post then input the TC 971 AC 017. Refer to IRM 3.13.5.115,Establishing a New Account (TC 000), for additional guidance.

    15. Take the appropriate steps to post Taxpayer "B" s tax information to the correct TIN. See (3) below.

    16. If a refund was issued on the CN to Taxpayer "B" , it must be moved to Taxpayer "B" s valid TIN. See IRM 21.5.2.4.23.10, Moving Refunds, for moving refund procedures. Maintain a monitored control base on IDRS on both accounts and monitor until all resulting transactions post correctly.

    17. If the taxpayer or the tax return preparer used an incorrect TIN, send a Letter 257C advising taxpayer "B" of the correct TIN to use. If SP processed the return using a different TIN, then send a Letter 257C but do not mention the TIN SP edited on the return during processing.

    18. If Taxpayer "A" indicates yes to the Presidential Election Campaign Fund (PECF) and Taxpayer "B" did not, prepare a dummy Form 1040X. Refer to procedures in IRM 21.6.7.4.12,Presidential Election Campaign Fund (PECF).

  2. For TY 2014 returns and later, correct Taxpayer "A" s account to reflect provisions of the Affordable Care Act (ACA).

    1. Compute the Premium Tax Credit (PTC) and all related data elements. See IRM 21.6.3.4.2.12.4, Tools for Accessing ACA-Taxpayer Data, and IRM 21.6.3.4.2.12.7, Adjusting Accounts.

    2. Determine the taxpayer’s liability for the Shared Responsibility Payment (SRP). See IRM 21.6.4.4.21.3, Shared Responsibility Payment Overview.

  3. The following should be taken into consideration when processing Taxpayer "B" s tax information to the correct TIN:

    If Then
    The TC 976/TC 977 return bypassed Discriminate Information Function (DIF) scoring After adjusting the account to reflect the TC 977/TC976 return information, forward the return to Examination for DIF scoring if it meets the criteria in IRM 21.5.2.4.23.6, Discriminate Index Function (DIF) SCORE or CLASSIFICATION "Send Return(s) to Examination for Review" .
    There is no TC 150 on Taxpayer "B" s account for the tax period involved Reprocess Taxpayer "B" s return. See IRM 21.5.2.4.23,Reprocessing Returns/Documents .
    There is a TC 150 on Taxpayer "B" s account for the tax period involved Adjust the account, if necessary. Follow IRM 21.6.7.4.4,Duplicate or Amended Returns - CP 36 (Duplicate Filing Condition).
  4. If Taxpayer "A" is due a refund, the refund should be systemically released unless an exception applies. See IRM 21.4.4.3, Why would a Manual Refund Be Needed. When it is necessary to issue a manual refund, HC 4 must be used on the adjustment. The manual refund should be issued before the return has been DIF Scored. Input a priority code (PC) 1 on the case. Refer to IRM 21.4.4.5, Preparation of Manual Refund Forms, for additional guidance on issuing a manual refund.

    Exception:

    If Taxpayer "A" (or the spouse of Taxpayer "A" ) filed a Form 8379, Injured Spouse Allocation, and your site does not work injured spouse cases do not attempt to issue a refund. Instead follow the instructions in (5) below.

  5. If Taxpayer "A" (or the spouse of Taxpayer "A" ) filed an injured spouse claim, correct the account to reflect Taxpayer "A" s information and then refer the Debtor Master File Case (DMFC) to the specialty group:

    1. Follow all instructions in (1) (2) and (3) above except use hold code 4 on the adjustment and/or use TC 570 on credit transfers to hold the overpayment.

    2. After inputting all account actions, close the CIS case.

    3. Open a new CIS case with category code "DMFC" . Assign the case to the appropriate IDRS number located on the Accounts Management Site Specialization Temporary Holding Numbers listing located on SERP. For the required fields, input the doc type as "Injured Spouse Claim" , use program and function code "ADJ-710-97140," "Priority 2" and reason "Form 8379 attached" .

      Reminder:

      If your site works Injured Spouse case work, do not reassign the case. The case should be retained and worked within your site.

    4. Link the new CIS case to the closed CIS case.

Valid Different TIN Not Located for Taxpayer "B"
  1. If a different valid TIN is not located for Taxpayer "B" through research/correspondence, obtain an Internal Revenue Service Number (IRSN) for Taxpayer "B" and take the following action:

    If Then
    Taxpayer "A" posted first
    1. Follow procedures in IRM 21.6.2.4.2.2, Valid TIN Located - Taxpayer "A" Posted First. Enter the IRSN where entry of a TIN for Taxpayer B is applicable.

      Exception:

      Do not send the Letter 257C. Send a Letter 4675C advising Taxpayer "B" to contact SSA and use the IRSN for federal tax purposes until SSA determines the correct SSN. SSA will advise the taxpayer to file Form W-7, Application for IRS Individual Taxpayer Identification Number, to obtain an ITIN if the taxpayer cannot obtain a SSN.

      Caution:

      When corresponding with the non-owner of the CN, send the letter from the non-owner's IRSN. Do not include the CN in your letter to the non-owner.

      Exception:

      Do not correspond with Taxpayer "B" if you are unable to locate a good address. Change the address for Taxpayer B to the Service Center address.

    Taxpayer "B" posted first
    1. Follow procedures in IRM 21.6.2.4.2.3, Valid TIN Located - Taxpayer "B" Posted First. Enter the IRSN where entry of a TIN for Taxpayer "B" is applicable.

    2. Allow the math error process resulting from the reprocessing of the return under an IRSN and the normal Collection process to address any balance due issues.

    3. Send a Letter 4675C advising Taxpayer B to contact SSA and use the IRSN for federal tax purposes until SSA determines the correct SSN. SSA will advise the taxpayer to file Form W-7, Application for IRS Individual Taxpayer Identification Number, to obtain an ITIN if the taxpayer cannot obtain a SSN.

      Caution:

      When corresponding with the non-owner of the CN, send the letter from the non-owner's IRSN. Do not include the CN in your letter to the non-owner.

      Exception:

      Do not correspond with Taxpayer "B" , if you are unable to locate a good address. Change the address for Taxpayer "B" to the Service Center address.

    4. If this is a TIN-Related Problem Secondary case, input TC 594 CC 084 on the Secondary TIN to cross-reference the Primary TIN, if it has not systemically generated already.

Invalid SSN - Mixed Entity
  1. When a mixed entity situation occurs on an invalid SSN, take the following actions:

    If Then
    (1) A different valid TIN is located for each taxpayer
    1. Consider the TC 150 to be Taxpayer "A" and TC 976, or TC 977 to be Taxpayer "B" .

    2. Merge the invalid TIN to Taxpayer "A" s valid TIN, per guidance in IRM 21.6.2.4.1, Resequencing Accounts.

    3. Follow procedures in IRM 21.6.2.4.2.2, Valid TIN Located - Taxpayer "A" Posted First.

    4. Send both taxpayers a Letter 257C.

    (2) A different valid TIN is located for only Taxpayer "A" (the first posted return)
    1. Obtain an IRSN for Taxpayer "B" .

    2. Merge the invalid TIN to Taxpayer "A" s valid TIN, per guidance in IRM 21.6.2.4.1, Resequencing Accounts.

    3. Follow procedures in IRM 21.6.2.4.2.2, Valid TIN Located - Taxpayer "A" Posted First.

      Note:

      Whenever reprocessing a return to taxpayer B's IRSN, edit with Computer Condition Code (CCC) 3 to hold the refund, (unless moving a previously issued refund). See IRM 21.5.2.4.23.10, Moving Refunds.

    4. Send Letter 257C to Taxpayer "A" . Send Letter 4675C advising Taxpayer "B" to contact SSA and use the IRSN for federal tax purposes until SSA determines the correct SSN. SSA will advise the taxpayer to file Form W-7, Application for IRS Individual Taxpayer Identification Number, to obtain an ITIN if the taxpayer cannot obtain a SSN.

    (3) A different valid TIN is located for only Taxpayer B (the second posted return)
    1. Obtain an IRSN for Taxpayer A.

    2. Merge the invalid TIN to Taxpayer A's IRSN, per guidance in IRM 21.6.2.4.1,Resequencing Accounts.

    3. Follow procedures in IRM 21.6.2.4.2.2, Valid TIN Located - Taxpayer "A" Posted First.

      Exception:

      Send a Letter 257C to Taxpayer B. Send a Letter 4675C advising Taxpayer A to contact SSA and use the IRSN for federal tax purposes until SSA determines the correct SSN. SSA will advise the taxpayer to file Form W-7 to obtain an ITIN if they cannot obtain an SSN.

      Caution:

      When corresponding with the non-owner of the CN, send the letter from the non-owner's IRSN. Do not include the CN in your letter to the non-owner.

      Exception:

      Do not correspond with the Taxpayer A if you are unable to locate a good address. (In this example, "Taxpayer A " is the non-owner.

    (4) A different valid TIN is not located for either taxpayer
    1. Obtain IRSNs for both taxpayers posted to the invalid segment of the CN.

    2. Consider the TC 150 to be Taxpayer A and the TC 976 or, TC 977 to be Taxpayer B.

    3. Merge the invalid TIN to Taxpayer A's IRSN, per guidance in IRM 21.6.2.4.1, Resequencing Accounts.

    4. Follow procedures in IRM 21.6.2.4.2.2, Valid TIN Located - Taxpayer "A" Posted First.

      Exception:

      Do not send a Letter 257C. Send both taxpayers a Letter 4675C. Advise both taxpayers to contact SSA and use the IRSN for federal tax purposes until SSA determines the correct SSN. SSA will advise the taxpayer(s) to file Form W-7 to obtain an ITIN if they cannot obtain a SSN.

      Caution:

      Send the letters to each taxpayer from his/her IRSN. Do not include the CN in your letters.

      Exception:

      Do not correspond with the taxpayer if you are unable to locate a good address. Change the address to the Service Center address.

    Caution:

    Do not release the -A freeze or invalid TIN freeze when moving taxpayer data to an IRSN.

Mixed Entity - TC 576 Taxpayer "A" Posted First
  1. Use the following procedures when a TC 576 is present and Taxpayer "A" posted first.

    If And Then
    (1) A valid SSN is located Taxpayer "A" posted first, creating the unallowable (UA) hold
    1. Input TC 971 with action code 002. Use Taxpayer "B" s SSN as the cross-reference SSN.

    2. Input TC 971 with action code 017 on Taxpayer "B" s account. Enter Taxpayer "A" s TIN as a cross-reference.

    3. Update Taxpayer "A" s entity if the original information has changed.

    (2) A subsequent adjustment action is necessary to transfer Taxpayer "B" s payment to his account  
    1. Route to Examination.

    2. Request input of a partial TC 300 with hold code 4 to release the "-Q" freeze.

    3. Transfer Taxpayer "B" s payments to his/her account upon Examination confirmation. Input TC 570 to prevent overpayment from refunding.

    4. Route Taxpayer "A" s return to Examination for resolution of the UA condition.

    5. Annotate closing action. Examination is responsible for the release of the -A Freeze.

    (3) There is no TC 150 on Taxpayer "B" s account for the module involved   Reprocess Taxpayer "B" s return. See IRM 21.5.1.5.5, Processing/Reprocessing CIS Tax Returns, and IRM 21.5.2.4.23, Reprocessing Returns/Documents.

    Note:

    MF processing freezes the refund and establishes Audit Information Management System (AIMS) if an UA condition exists

    (4) Taxpayer "B" s account contains a TC 150 for the tax period involved   Adjust the account, if necessary. Follow IRM 21.6.7.4.4,Duplicate or Amended Returns - CP 36 (Duplicate Filing Condition).
    (5) The taxpayer or tax return preparer used an incorrect SSN   Send a Letter 257C to inform the taxpayer.

    Note:

    If SP processed the return using a different TIN, then send a Letter 257C but do not mention the TIN SP edited on the return during processing.

Mixed Entity - TC 576 Taxpayer "B" Posted First
  1. When a valid SSN is located, Taxpayer "B" s return posted first and Taxpayer "A" s return contains no Unallowable Code (UA) condition, take the following action:

    1. Route to Examination.

    2. Request closure of AIMS on the CN.

    3. Annotate the closing action taken on the account. Include the SSN and period to which Taxpayer "B" s return was processed. Examination monitors the account for posting of the reprocessed return.

      Note:

      MF processing freezes the refund and establishes AIMS if an UA condition is present.

    4. Suspend case, monitoring for the AIMS closure.

    5. Upon closure, follow procedures in IRM 21.6.2.4.2.3, Valid TIN Located - Taxpayer "B" Posted First.

  2. When a valid SSN is located, Taxpayer "B" s return posted first and there is an UA condition on Taxpayer "A" s return, take the following action:

    1. Route to Examination.

    2. Request input of a partial TC 300 .00 with hold code 4 to release "-Q" freeze.

    3. Suspend the case.

      Note:

      AIMS remains open.

    4. Upon confirmation, follow procedures in IRM 21.6.2.4.2.3, Valid TIN Located - Taxpayer "B" Posted First.

    5. Route Taxpayer "A" s return to Examination for resolution of the UA condition.

    6. Annotate all pertinent information (e.g., John Maple [Taxpayer "A" ] posted as TC 976 on SSN 000–00–0001. Return contains UA Earned Income Tax Credit (EITC). John Maple [Taxpayer "B" ] reprocessed to correct SSN 000–00–0000).

Mixed Entity Invalid SSN - TC 576
  1. When a mixed entity occurs on an invalid SSN, use procedures in IRM 21.6.2.4.2.5, Invalid SSN - Mixed Entity.

Scrambled SSN Case Procedures

  1. All means of determining the owner of the common number (CN) should be exhausted, following IRM 25.23.4, IDTVA Paper Process, before following Scrambled SSN Case Procedures.

  2. Scrambled procedures are followed only for accounts determined to be True Scrambled or Default True Scrambled.

  3. If NUMIDENT indicates the Common Number (CN) was given to two or more taxpayers, the account is a True Scrambled.

  4. A Default True Scrambled SSN Case condition occurs when all of the following are met:

    1. One or both taxpayer(s) reply to the Letter 239C, TIN Related Problem Resolution, and state the SSN belongs to them.

    2. The taxpayer(s) stating the SSN belongs to them has provided all possible information up through correct responses to the supplementary questions. See IRM 25.23.4.24.2.1, Supplementary Questions.

    3. A determination for CN ownership cannot be made.

      Note:

      It should be an extremely rare situation in which we cannot make a CN ownership determination at this point. Review all available information carefully. A CN ownership determination must be made on the basis of any degree of advantage supported by research or information received. If any degree of advantage exists, make a determination of CN ownership on the basis of one or more of the criteria found in IRM 25.23.4.21.2, A Different Valid TIN Is Not Located AND Identity Theft Is Not Indicated By Taxpayer.

  5. If a taxpayer has tax modules under more than one TIN, every effort must be made to consolidate the accounts under one unique TIN, BEFORE using scramble procedures.

    Note:

    Research must be conducted using all resources available: AMS, CIS, IDRS, etc. and when required, IAT Tools must be used. See IRM 21.2.2.4.4.14, Integrated Automation Technologies.

    • If the case is a True/Default True Scrambled SSN case, establish a case file on CIS. The CIS case file should include all research and documentation, including copies of all returns and Form W-2 (s). For history sheet requirements, see IRM 21.6.2.4.3.13, Case History Sheet. A TIN-Related Problem Research Sheet, however, showing actions taken and any other notations as required by this IRM must be attached to the primary CIS case.

  6. Scrambled cases are controlled using category SCRM or SSA2.

    • SCRM - used when the account is being scrambled. Ages at 150 days.

      Note:

      Cases must not be prematurely or erroneously controlled using category SCRM. Mixed Entity and SDC cases must not be controlled using category SCRM.

    • SSA2 - used only for True/Default True Scrambled cases. The case is awaiting SSA Form 3857 response. Ages at 730 days.

      Note:

      The category code is not changed to "SSA2" until the Form 3857 has been sent to SSA.

      Note:

      Current IRM procedures restrict the cases sent to SSA for resolution to True/Default True Scrambled SSN cases. Current procedures provide guidelines for resolution of all other types of cases without SSA involvement. It is understood, however, that there are residual cases, i.e., cases other than True/Default True Scrambled cases that were categorized as "SSA2" prior to the current procedures.

  7. The (CN) is scrambled to prevent returns from posting to the SSN.

  8. Scrambled cases may be identified by Scrambled SSN Indicator (SCI) 01, 10, 12, 13, 20 or 23 located on ENMOD or IMFOLE of the (CN) Refer to Exhibit 21.6.2-1, Scrambled SSN Indicators.

  9. Expedite scrambled SSN case document requests from files by using CC ESTABV. Notate "Scrambled SSN" in the request remarks.

  10. Route scrambled cases requiring Statute action to the Statute function.

  11. Consider erroneous refund procedures. See IRM 21.4.5, Erroneous Refunds.

  12. If the account has a TC 898 offset to a state or federal agency, refer to IRM 21.4.6.5.18 , Scrambled SSN Cases With TOP Offsets, before taking any action.

  13. Route cases with a Z freeze to the Scheme Development Center (SDC). For cases with a P- Freeze with category code PFRZ, refer to IRM 21.5.6.4.31.2, P- Freezes with Integrity and Verification Operations (IVO) Involvement, for additional guidance. Take no action unless the Z freeze is released. If the Z and/or P- freeze is released, follow established scrambled SSN procedures.

    Caution:

    Do not follow SDC instructions which deviate from established procedures. These procedures do not permit SDC determinations of the CN owner.

  14. If ID Theft is indicated, see IRM 25.23.4 , IDTVA Paper Process.

  15. Follow mixed entity procedures if:

    • The taxpayer indicates that he/she purchased, borrowed or stole the SSN. The caseworker may receive this information directly from the taxpayer or through another IRS employee or Treasury Inspector General for Tax Administration (TIGTA).

    • The common number is an ITIN or invalid SSN.

  16. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

Beginning Scrambled Procedures
  1. Analyze the case to identify the taxpayers involved:

    • Taxpayer 1 -Taxpayer who has used the CN for the most years or the taxpayer who has the most statute year returns posted to the CN.

    • Taxpayer 2 - Taxpayer who has not used the CN for the most years or has the fewest statute year returns posted to the CN.

  2. Analyze the case to determine which condition exists:

    • Condition 1 - Taxpayer 1 posted first.

    • Condition 2 - Taxpayer 2 posted first.

    Note:

    If both taxpayers are first time filers, then the taxpayer who posted as the TC 150 becomes Taxpayer 1. Follow procedures for Condition 1.

  3. Use local procedures to obtain an IRSN for each taxpayer. IRSN 1 is issued for Taxpayer 1. IRSN 2 is issued for Taxpayer 2. When establishing IRSN 2 set the appropriate Scrambled SSN Indicator (SCI). Exhibit 21.6.2-1, Scrambled SSN Indicators.

    Note:

    If either taxpayer was issued an IRSN in a prior year, use the IRSN previously issued to that taxpayer.

  4. Research to determine if there is a closed or existing scrambled SSN case for the same taxpayer.

    If Then
    A previously scrambled case was closed with a response from SSA Follow mixed entity procedures.
    An existing scrambled case is waiting for SSA's reply
    1. Review prior case file.

    2. Follow the procedures in IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number.

    3. If the case is a True/Default True Scrambled SSN case, send a follow-up request to SSA, if necessary.

  5. If substantiation of identity theft is received from one taxpayer after the Letter 239C 40-day suspense period (70-days for overseas taxpayers), has expired, follow procedures in IRM 25.23.4.21.1.1, Identity Theft - More Than One Return Present. Change the control category to "IDT1/IDS1."

    Note:

    Please see IRM 25.23.2.3.5, When to Request Additional Information to Support an Allegation of Identity Theft, for acceptable identity theft documentation.

  6. If substantiation of identity theft is received from both taxpayers, follow procedures in IRM 25.23.4.21.1.1, Identity Theft - More Than One Return Present. Change the control category to "IDT1/IDS1" .

  7. If at any time a completed Letter 239C questionnaire is received after the 40-day suspense period has expired, 70-days for overseas taxpayers, follow the procedures in IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number, and, if necessary, in IRM 25.23.4.24, Pre-Letter 239C Common Number (CN) Ownership Determinations Cannot Be Made.

Scrambled Procedures Specific to True/Default True Scrambled SSN Cases
  1. Follow the If/Then table below when scrambling a True/Default True Scrambled SSN Case:

    If Then
    One or both of the taxpayers responded with a completed questionnaire
    • Input the appropriate SCI on the CN. Exhibit 21.6.2-1Scrambled SSN Indicators.

    • Prepare initial Form 3857.

    • Forward initial Form 3857 and case file to the Scrambled SSN Coordinator. See IRM 21.6.2.4.3.6, Form 3857 Request for SSN Clarification. The Scrambled SSN Coordinator will review and return the case file within 3 business days.

    • Send both taxpayers a second Letter 239C. Advise the taxpayers that SSA has been contacted and to use the IRSN for federal tax purposes. Instruct the taxpayer to contact SSA.
      If you are requesting information from the taxpayer, suspend the case for 40-days, 70-days for overseas taxpayers.

    • Scramble the account.

    Neither taxpayer responded with a completed questionnaire

    Note:

    This If/Then applies only to True Scrambled SSN cases. It does not apply to Default True Scrambled SSN cases. See IRM 21.6.2.4.3.2, Scrambled Procedures Specific to True/Default True Scrambled SSN Cases.

    • Input SCI 10 on the CN and IRSNs.

    • Send a second Letter 239C to each taxpayer. Advise the taxpayers to complete the questionnaire, submit documentation required in IRM 21.6.2.4.3.3, Determining if the Refund Should be Released, and use the IRSN for federal tax purposes. Instruct the taxpayer to contact SSA.
      Advise the taxpayers to respond within 30-days, 60-days for overseas taxpayers.

    • Scramble the account.

    • Attach the Case History Sheet, Form 13708, to the primary CIS case.

    • Attach the Research Sheet to the primary CIS case.

    • If neither taxpayer responds to this 2nd Letter 239C, close the case after all scrambling procedures have been completed.

    Note:

    If one taxpayer responds with substantiation of identity theft before the suspense period from the date the second Letter 239C request has expired, do not take action to immediately resolve. Allow the suspense period to expire before resolving case.

    Note:

    Please see IRM 25.23.2.3.5, When to Request Additional Information to Support an Allegation of Identity Theft, for acceptable identity theft documentation.

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

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

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

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

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    Caution:

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

Determining If the Refund Should Be Released
  1. DO NOT release the refund if the taxpayer does not respond to the Letter 239C with a complete and accurate questionnaire and all of the following:

    1. Name

    2. Current telephone number

      Note:

      If the taxpayer indicates verbally or in writing that they do not have a telephone, consider this requirement to be met. If the taxpayer indicates that they do not wish to give out their telephone number, do not consider the requirement to be met.

    3. Copy of Social Security Card

    4. Copy of a current document verifying the taxpayer's address. Acceptable current documentation includes a copy of a bank statement, lease agreement, mortgage statement or utility bill.

    5. Copy of a document to verify the taxpayer's identity. Acceptable documentation is a copy of a driver's license, state identification card, passport or other federal or state government issued photo identification which is valid and unexpired.

    Note:

    If a taxpayer claims identity theft and provides required documentation, follow guidance in (14) of IRM 21.6.2.4.3, Scrambled SSN Case Procedures.

  2. If the taxpayer is claiming a hardship, which may warrant the issuance of a manual refund, refer the case to The Taxpayer Advocate Service (TAS) for hardship determination per IRM 21.4.4.3, Why Would A Manual Refund Be Needed?

  3. Overpayment(s) a year old or older must be transferred to Excess Collections when the account is scrambled. Allow an Accounts Maintenance Research (AMRH) transcript(s) to generate on account(s) with overpayment(s) less than a year old. See IRM 21.2.4.3.10.1, Excess Collection File (XSF) for AMRH.

Condition 1 Case Processing
  1. These procedures are to be used when Condition 1 is present.

  2. Correct the CN entity information to agree with Taxpayer 1's return.

  3. Edit the SSN on Taxpayer 1's return to show IRSN 1.

  4. Reprocess Taxpayer 2's return to IRSN 2. See IRM 21.5.2.4.23, Reprocessing Returns/Documents, for editing instructions. Edit with Computer Condition Code (CCC) 3 to hold the refund, if necessary. See IRM 21.6.2.4.3.3, Determining if Refund Should be Released.

    Note:

    If statute or statute-imminent return, refer to IRM 25.23.4.21.4, Determining When Specific Year Account Information Must Be Moved.

  5. Transfer Taxpayer 2's payment(s) from the CN to IRSN 2.

  6. Input TC 971, Action Code 002 on the CN to cross-reference to IRSN 2. Input TC 971, Action Code 017 on the IRSN to cross-reference the CN.

  7. Input a TC 290 .00, Blocking Series 00 (or if Taxpayer 1 filed an electronic return, use Blocking Series 05), on the CN to release the -A freeze. Use Hold Code 4 if the overpayment must be held. See IRM 21.6.2.4.3.3, Determining if the Refund Should be Released. Allow items requiring a valid primary TIN, i.e., EITC, primary exemption, and/or education credit, if Taxpayer 1 would otherwise qualify for the items.

  8. Resolve all conditions that would prevent the CN from merging. See IRM 21.6.2.4.1.2, Resequencing Action Required.

  9. Resequence CN to IRSN 1. Include appropriate scrambled SSN indicator. Exhibit 21.6.2-1.Scrambled SSN Indicators.

  10. After Taxpayer 2's return posts to IRSN 2, input TC 510 and/or TC 571 to release the refund, if appropriate. See IRM 21.6.2.4.3.3, Determining if the Refund Should be Released.

    Note:

    If Taxpayer 2 claimed items requiring a valid primary TIN, i.e., EITC, primary exemption, and/or education credit, a math error will be issued during the reprocessing of the return disallowing these items because the primary TIN is invalid. Do not adjust IRSN 2 to allow items requiring a valid primary TIN unless NUMIDENT indicates a True Scrambled SSN case. Do not make the adjustment for a Default True Scrambled SSN case.

  11. If taxpayer(s) did not submit a complete Letter 239C response, transfer overpayment(s) a year old or older to Excess Collections. See IRM 21.2.4.3.10.1, Excess Collection File (XSF) for AMRH. Allow an AMRH transcript(s) to generate on account(s) with overpayment(s) less than a year old. Also refer to IRM 21.2.4-3, AMRH FREEZE TABLE IMF/BMF, for additional guidance and IRM 21.6.2.4.3.3, Determining if the Refund Should be Released, for documentation required for a complete response.

  12. Establish a summary account on the CN to prevent returns from posting.

    1. Input TC 000 with the appropriate scrambled SSN indicator and MFR 08 after the CN is completely resequenced to the IRSN 1.

    2. Include all items shown on Taxpayer 1's account. The year must be the current tax period.

    3. Enter the two-digit campus code and both IRSNs on the second name line.

      Note:

      Omit the hyphens in IRSNs to allow space to input three IRSNs, if necessary.

  13.  

    If SSA acknowledgement Then
    received
    1. Send each taxpayer a Letter 239C advising them that SSA has acknowledged receipt of our request for SSN verification.

    2. If additional information is received, follow procedures in IRM 21.6.2.4.3.8, Processing Additional Information, or IRM 21.6.2.4.3.9, Resolving Scrambled SSN Cases, as appropriate.

      Note:

      Control base must remain open waiting for SSA's Form 3857 response. If one year expires, from the date Form 3857 was sent to SSA, follow procedures in IRM 21.6.2.4.3.9, Resolving Scrambled SSN Cases .

    not received within 90 days Before preparing a second 3857 package to forward to SSA, make contact with the SSA POC to determine the status of the 3857 package(s). If you are unable to obtain a response from SSA POC within 14 days, report the issue to the IDTVA Scrambled SSN P&A Analyst.
Condition 2 Case Processing
  1. These procedures must be used when Condition 2 is present.

  2. Correct the CN entity information to agree with Taxpayer 1's return.

  3. Edit the SSN on Taxpayer 1's return to show IRSN 1.

  4. Reprocess Taxpayer 2's return to IRSN 2. See IRM 21.5.2.4.23, Reprocessing Returns/Documents, for editing instructions. Edit the return with the appropriate Computer Condition Code. See IRM 21.6.2.4.3.3, Determining if the Refund Should be Released.

    1. Use CCC "3" to hold the refund, if necessary.

    2. Use CCC "O" if a refund was previously issued to Taxpayer 2 on the CN.

    Note:

    If statute or statute-imminent return, refer to IRM 25.23.4.21.4, Determining When Specific Year Account Information Must Be Moved.

  5. Transfer Taxpayer 2’s payments from the CN to IRSN 2.

  6. If a refund was issued on the CN to Taxpayer 2, then the refund must be moved. See IRM 21.5.2.4.23.10, Moving Refunds, for instructions.

    Note:

    The refund must never be "netted" out of withholding.

  7. Input TC 971, Action Code 001, on the CN to cross-reference the TC 150 to IRSN 2. Input TC 971, Action Code 017 on the IRSN to cross-reference the CN.

  8. Math verify Taxpayer 1's return. Adjust the CN to agree with Taxpayer 1's return using blocking series 00. Use procedures in IRM 21.6.2.4.2, Mixed Entity Procedures, to delete the incorrect taxpayer’s information from the account. Use hold code "4" to hold the refund, if applicable. See IRM 21.6.2.4.3.3, Determining if the Refund Should be Released. Notate in remarks "Scrambled SSN - DUP becomes original."

    Caution:

    If Taxpayer 2 requested a direct deposit and the refund did not generate due to the TC 976, then TC 971 AC 001 must be input and posted before adjusting the CN to agree with Taxpayer 1's return. TC 971 AC 001 will prevent the refund from being direct deposited into Taxpayer 2's account due to programming changes implemented. In this instance the TC 971 AC 850 is not required.

    Note:

    If a statute or statute-imminent tax period, refer to IRM 25.23.4.21.4, Determining When Specific Year Account Information Must Be Moved.

  9. Forward Taxpayer 1's return to Examination for DIF scoring if it meets any of the criteria in IRM 21.5.2.4.23.6, Discriminate Index Function (DIF) SCORE or CLASSIFICATION "Send Return(s) to Examination for Review" . Use local procedures.

  10. Correct the Return Processable Date if necessary using the date of the TC 976. See IRM 21.5.6.4.17, I- Freeze.

  11. Resolve all conditions that would prevent the account from merging. See IRM 21.6.2.4.1.2, Resequencing Action Required.

  12. Resequence the CN to IRSN 1.

  13. After Taxpayer 2's return posts to IRSN 2, input TC 510 and/or TC 571 to release the refund, if appropriate.

    Note:

    If Taxpayer 2 claimed items requiring a valid primary TIN, a math error will be issued during the reprocessing of the return disallowing these items because the primary TIN is invalid. Do not adjust IRSN 2 to allow items requiring a valid primary TIN unless NUMIDENT indicates a True (Non-Default True) Scrambled SSN case or a refund was issued on the CN to Taxpayer 2.

  14. If taxpayer(s) did not submit a complete Letter 239C response, transfer overpayment(s) a year old or older to Excess Collections. See IRM 21.2.4.3.10.1, Excess Collection File (XSF) for AMRH. Allow an AMRH transcript(s) to generate on account(s) with overpayment(s) less than a year old. See IRM 21.6.2.4.3.3, Determining if the Refund Should be Released, for documentation required for a complete response.

  15. Establish a summary account on the CN to prevent any returns from posting.

    1. Input TC 000 with the appropriate scrambled SSN indicator and MFR 08 after the CN is completely resequenced to the IRSN 1.

    2. Include all items shown on Taxpayer 1’s account. The year must be the current tax period.

    3. Enter the two-digit campus code and both IRSNs on the second name line.

      Note:

      Omit the hyphens in IRSNs to allow space to input three IRSNs, if necessary.

    Note:

    At this point in processing, all Letter 239C responses should be attached to the CIS case, as should images of pertinent tax returns.

  16. If a Letter 239C response is received after a case has been closed, reassign the case to the designated IDRS number and link the new information to the prior CIS case. Send a courtesy e-mail to the designated employee to alert the employee of the new information. If Form 3857 is sent to SSA, change the control category to "SSA2" and reassign the case to designated IDRS number. Also ensure the completed Form 3857 is scanned to the CIS case. Refer to the AM Site Specialization Temporary Holding Numbers for a complete list of designated IDRS numbers. The Scrambled SSN Coordinator will monitor the case for an SSA acknowledgement.

  17. If SSA acknowledgement Then
    received
    1. Send both taxpayers a Letter 239C advising them that SSA has acknowledged receipt of our request for SSN verification.

    2. If additional information is received, follow procedures in IRM 21.6.2.4.3.8, Processing Additional Information, or IRM 21.6.2.4.3.9, Resolving Scrambled SSN Cases, as appropriate.

      Note:

      Control base must remain open waiting for SSA's Form 3857 response. If one year expires, from the date Form 3857 was sent to SSA, follow procedures in IRM 21.6.2.4.3.3, Determining If the Refund Should Be Released.

    not received within 90 days Before preparing a second 3857 package to forward to SSA, make contact with the SSA POC to determine the status of the 3857 package(s). If you are unable to obtain a response from the SSA POC within 14 days, report the issue to the IDTVA Scrambled SSN P&A Analyst.
Form 3857, Request for SSN Clarification
  1. Contact SSA using Form 3857, Request for SSN Clarification, only for True/Default True Scrambled SSN cases. Include any pertinent information with Form 3857 to assist in resolution of the problem.

    Caution:

    If the CN is an invalid SSN, do not prepare Form 3857. These cases are resolved following the procedures in IRM 21.6.2.4.2.5, Invalid SSN – Mixed Entity.

  2. Complete Form 3857 with the following:

    • Atlanta Service Center, IDTVA AM Atlanta: Stop I2100, Post Office Box 47421, Doraville, GA 30362.

    • Date sent to SSA

    • CN

      Caution:

      Do not include IRSNs on Form 3857.

    • Tax period

    • Check the appropriate box indicating why Form 3857 is being sent, ie., original request, no acknowledgement, additional information follow-up, or no SSA response

    • Complete name and address for each taxpayer

    • Check the appropriate box indicating which income documents are attached

    • Business name and address, if taxpayer was self-employed

    • Year each taxpayer first used the CN

    • Check the "Yes" box indicating if the taxpayer submitted a completed Letter 239C questionnaire.

  3. Attach legible photocopies of all Form W-2(s). Delete all money amounts except Social Security and Medicare.

  4. Attach copies of the Letter 239C replies, including questionnaire, documentation, and correspondence.

  5. Notate on Form 3857 any information received regarding recent address changes for the taxpayer(s).

  6. SSA will send a Form 3857 acknowledgement within 90 days. The acknowledgement will show the current status of Form 3857.

    Caution:

    Do not confuse SSA acknowledgements and final responses. Final responses will identify the common number owner or clearly state "case closed" .

  7. If an SSA acknowledgement is not received within 90 days, contact the SSA POC to determine the status of the 3857 package(s). If you are unable to obtain a response from SSA POC within 14 days, report the issue to the Headquarters Scrambled SSN Analyst.

  8. Only True/Default True Scrambled SSN cases are to be sent to SSA for resolution. For unresolved SCRM and SSA2 cases categorized as such prior to this revision of the IRM, the procedures in IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number, and, if necessary, IRM 25.23.4.24, Pre-Letter 239C Common Number (CN) Ownership Determinations Cannot be Made, may be utilized to make ownership determinations.

  9. If Form 3857 was sent to SSA, change control category to "SSA2" , reassign the case to designated IDRS number located on the AM Site Specialization Temporary Holding Numbers listing. The Scrambled SSN Coordinator will monitor the case for an SSA acknowledgement. Also ensure the completed Form 3857 is scanned to the CIS case.

    Note:

    Cases categorized as "SSA2" in error will be rejected back to the originating site with a note indicating why it was rejected.

Maintaining Scrambled SSN Files
  1. Scrambled cases must remain open on IDRS utilizing control category SSA2 waiting for SSA’s Form 3857 response.

    Note:

    Only True/Default True Scrambled SSN cases are to be sent to SSA for resolution. For unresolved SCRM and SSA2 cases categorized as such prior to this revision of the IRM, the procedures in IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number, and, if necessary, in IRM 25.23.4.24, Pre-Letter 239C Common Number (CN) Ownership Determinations Cannot be Made, may be utilized to make ownership determinations.

  2. Each case file must include:

    • A completed history sheet.

    • Copies of all returns and Form W-2 ’s involved

    • Copies of any taxpayer correspondence, including the Letter 239C replies

    • Copy of the Form 3857 sent to SSA

  3. File taxpayer correspondence and other pertinent documentation with the related return for future reference.

Processing Additional Information
  1. Additional information received after a Form 3857 is sent to SSA must be submitted to SSA as a follow-up.

    Note:

    The procedures in this subsection indicating contact with SSA apply only to True/Default True Scrambled SSN cases. Only True/Default True Scrambled SSN cases are to be sent to SSA for resolution. For unresolved SCRM and SSA2 cases categorized as such prior to this revision of the IRM, the procedures in IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number, and, if necessary, IRM 25.23.4.24, Pre-Letter 239C Common Number (CN) Ownership Determinations Cannot be Made, may be utilized to make ownership determinations.

  2. Notify SSA if either taxpayer files a return after the year in question or additional information is received from either taxpayer.

    1. Check the "Additional Information Follow-up" box in Part I of Form 3857.

    2. Complete the top portion of page 2 of Form 3857.

    3. Attach a copy of new Form W-2(s) (delete all money amounts except Social Security and Medicare) and/or other new identifying information.

  3. Scrambled cases closed without sending Form 3857 to SSA are identified by history item "no 239 reply" , or "SCI 10" or "SCI 20" on the CN summary account. If a completed Letter 239C questionnaire is received from one of the taxpayers after the case is closed, the procedures in IRM 25.23.4.21, Non-Streamline IDT Case Processing - Determining Ownership of the Common Number, and, if necessary, in IRM 25.23.4.24, Pre-Letter 239C Common Number (CN) Ownership Determinations Cannot be Made, should be utilized to make ownership determinations.

Resolving Scrambled SSN Cases
  1. When a Form 3857 response is received from SSA, or the taxpayer submits a response, take the appropriate action to close the case.

    Note:

    When a response is received from SSA or the taxpayer and the case is in the closed two-year file, pull the two year file and reopen the case with the new received date of the Form 3857 reply or the taxpayer's inquiry. Take appropriate action to close the case.

    Note:

    Current IRM procedures restrict the cases sent to SSA for resolution to True/Default True Scrambled SSN cases. Current procedures provide guidelines for resolution of all other types of cases without SSA involvement. It is understood, however, that there are residual cases, i.e., cases other than True/Default True Scrambled cases that were categorized as "SSA2" prior to the current procedures. Consequently, responses from SSA or from the taxpayer that determine ownership of the CN or that provide a valid SSN for the taxpayer will be utilized to resolve the case. The following procedures would, in those cases, be applicable. If, however, the responses received do not resolve the case, review the case anew using current procedures which authorize IRS determinations of CN ownership

  2. Verbal SSA responses are unacceptable. If SSA calls with a Form 3857 response, request that they complete and return Form 3857. Form 3857 responses may be faxed or mailed.

  3. If SSA does not verify the CN owner, the scrambled condition cannot be resolved. The accounts must be processed under the IRSNs until action by the taxpayer or SSA provides a resolution.

    Exception:

    We will resolve the case if a determination of CN ownership can be made using current IRM procedures.

  4. Consider the following:

    Note:

    To prevent unnecessary AMRH transcripts, take action when resolving Scrambled SSN cases to transfer overpayment(s) a year old or older to Excess Collections. See IRM 21.2.4.3.10.1, Excess Collection File (XSF) for AMRH.

    If And Then
    (1) SSA indicates one taxpayer is the CN owner The other taxpayer is "unknown"
    1. Resequence the IRSN belonging to the CN owner to the CN. Include the appropriate closing scrambled SSN indicator. Refer to Exhibit 21.6.2-1, Scrambled SSN Indicators.

    2. Input a TC 012 in the same cycle with the appropriate SCI to the CN.

    3. Input TC 510 and/or TC 571 as appropriate to release the CN owner's refunds.

    4. Send a Letter 239C to the CN owner advising them to use the CN.

    5. Adjust the CN owner's account to allow items previously disallowed that require a valid primary TIN.

    6. Input TC 971 AC 506 with a posting delay of 4 cycles on the entity module of the CN. Use the SECONDARY-DT field to indicate the tax year in question. Use the TRANS-DT field to indicate the current (input) date. Input "WI ITVAA MULTFL" in the MISC field, if applicable.

      Exception:

      If the applicable procedures involved in processing the current case already require the input of TC 971 AC 501, then do not input TC 971 AC 506.

    7. If the "unknown" taxpayer received a refund which included items requiring a valid primary TIN, initiate math error procedures to reverse the items. See IRM 21.5.4, General Math Error Procedures.

      Note:

      For TIN-Related Problem Secondary Cases, follow Erroneous Refund procedures if the "unknown" taxpayer is the secondary on the joint account.

    8. Attach a copy of SSA's reply (Form 3857) to the most current year return on file for each of the taxpayers.

    9. Send the "unknown" taxpayer a Letter 239C advising them that information from SSA indicates that the SSN shown on their return was not assigned to them.

      Caution:

      When corresponding with the non-owner of the CN, send the letter from the non-owner's IRSN. Do not include the CN in your letter to the non-owner.

    (2) One taxpayer supplies a different valid SSN  
    1. Resequence the IRSN of the taxpayer who provided a different TIN to the correct TIN.

    2. Input a TC 012 in the same cycle with the appropriate closing scrambled SSN indicator on the CN. Exhibit 21.6.2-1, Scrambled SSN Indicators.

    3. Resequence the other IRSN to the CN. Include the appropriate closing scrambled SSN indicator. Exhibit 21.6.2-1, Scrambled SSN Indicators.

    4. Input TC 510 and/or TC 571 as appropriate to release the refunds.

    5. Send a Letter 239C to the CN owner.

    6. Adjust both SSNs to allow items previously disallowed that require a valid primary TIN.

    7. Attach taxpayer's correspondence to the most current year return on file.

    8. If Form 3857 was sent to SSA, advise the Scrambled SSN Coordinator the case was closed without a SSA Form 3857 response.

    (3) SSA indicates one taxpayer should use the CN The other taxpayer is assigned a different SSN
    1. Follow steps 1 through 6 above in the first If/Then box.

    2. Attach a copy of SSA's reply (Form 3857) to the most current year return on file for each of the taxpayers.

    (4) SSA or the taxpayer indicates there is only one taxpayer involved (same taxpayer)  
    1. Combine the two returns using the IRSN account with the greatest number of statute year tax modules. Use Blocking Series 77/78, SC 6, and apply erroneous refund procedures if appropriate.

    2. Input a TC 012 with the appropriate closing scrambled SSN indicator on the CN. Exhibit 21.6.2-1, Scrambled SSN Indicators.

    3. Resequence the newly adjusted IRSN to the CN. Include the appropriate closing scrambled SSN indicator. Exhibit 21.6.2-1, Scrambled SSN Indicators. Use a posting delay for six cycles, if inputting the merge before the adjustment has posted.

    4. Order any other open statute returns associated with this taxpayer that may be combined or reinput to the CN. Zero out the modules on the other IRSN from which returns are being reinput or combined.

      Note:

      If a statute or statute-imminent return, refer to IRM 25.23.4.21.4, Determining When Specific Year Account Information Must Be Moved.

    5. After all adjustments have posted to the other IRSN, input TC 020 to deactivate the other IRSN.

    6. Send the taxpayer a Letter 673C, Duplicate Returns Filed; Adjustment or Refund Explained, advising them we combined the returns and in the future they should file a Form 1040X to make changes to their original return.

    7. Change the address, if necessary.

    8. Attach a copy of SSA's reply (Form 3857) or taxpayer's correspondence to the most current year return on file.

    9. If Form 3857 was sent to SSA and the case was resolved without a SSA Form 3857 response, notify the Scrambled SSN Coordinator.

    (5) SSA indicates that the CN does not belong to any of the taxpayers involved SSA supplies a different valid SSN for one or both taxpayers involved
    1. Input a TC 020 to the CN.

      Note:

      If any modules exist, move the modules before inputting TC 020 to delete the account.

    2. Resequence the IRSN(s) (may be input in the same cycle) to the correct SSNs. Include the appropriate closing scrambled SSN indicator. Exhibit 21.6.2-1, Scrambled SSN Indicators.

    3. Input TC 510 and/or TC 571 as appropriate to release the taxpayer's refund(s) if a different valid SSN was supplied.

    4. Send a Letter 239C to taxpayer(s) advising them of the correct SSN to use. If a different valid SSN was not supplied for one of the taxpayers, send a Letter 239C to the taxpayer advising them SSA indicated they were not the CN owner and to continue using the IRSN previously assigned.

      Caution:

      When corresponding with the non-owner of the CN, send the letter from the non-owner's IRSN. Do not include the CN in your letter to the non-owner.

    5. If Earned Income Tax Credit (EITC), exemptions and/or credits were previously disallowed because the primary TIN was not valid, and we now have a valid TIN, adjust the account to allow the EITC, exemptions and/or credits.

      Caution:

      If a different valid SSN was not supplied for the taxpayer, and the taxpayer received a refund that included items requiring a valid primary TIN, initiate math error procedures to reverse the items. See IRM 21.5.4, General Math Error Procedures.

    6. Attach a copy of SSA's reply (Form 3857) to the most current year return on file.

    (6) SSA response does not contain sufficient information to resolve the scrambled condition, i.e., both taxpayers are "unknown," or "unable to determine" is written in the remarks areas  
    1. If unable to make an ownership determination, send a Letter 239C to each taxpayer advising them SSA was unable to verify the SSN.

    2. Input the appropriate closing scrambled SSN indicator on CN and IRSNs. Exhibit 21.6.2-1, Scrambled SSN Indicators.

    3. Associate a copy of SSA's Form 3857 response to the most current year return on file for each taxpayer.

    4. Close case.

    Note:

    This type of response should primarily pertain only to residual SSA2 cases, i.e., SSA2 cases other than True/Default True Scrambled SSN cases that were categorized as SSA2 prior to the current IRM. Before following the steps above, review the case anew using the current guidelines which authorize IRS determinations of CN ownership.

    (7) SSA response indicates that the common number is no longer valid for federal tax purposes SSA supplies a different valid SSN for one or both of the taxpayers
    1. Input SCI "13" on the CN.

    2. Resequence the IRSNs (may be input in the same cycle) to the correct SSNs, if supplied. Include SCI "9."

    3. If a valid different SSN was not supplied for one of the taxpayers, input SCI "13" on the corresponding IRSN.

    4. If a valid different SSN was supplied for the taxpayer(s), input TC 510 and/or TC 571 as appropriate to release refund(s). Adjust the account to allow the EITC, exemptions and/or credits previously disallowed because the primary TIN was not valid.

    5. Send a Letter 239C to each taxpayer advising them of the correct SSN to use. If a valid different SSN was not supplied for one of the taxpayers, send a Letter 239C advising them information from SSA indicates that the SSN shown on their return was not assigned to them.

    6. Attach a copy of SSA's Form 3857 response to the most current year return on file for each taxpayer.

  5. If ownership of the CN is determined and the taxpayer submitted standard identity theft documentation, see IRM 25.23.2.3.5, When to Request Additional Information to Support an Allegation of Identity Theft, for acceptable documentation.

  6. If one-year passes, and no reply is received from SSA or the taxpayers, pull the scrambled SSN file and review the case. If necessary, send a second Form 3857 request to SSA. See IRM 21.6.2.4.3.6, Form 3857, Request for SSN Clarification, for required entries.

Scrambled SSN Coordinator Responsibilities
  1. Refer to the Scrambled SSN Coordinators, for the Scrambled SSN Point of Contact.

  2. The coordinator ensures:

    • Form 3857 is complete and legible

    • Preliminary research is completed

      Note:

      This can be verified by reviewing the history sheet. The scrambled SSN coordinator must not "rework" the case.


       

    • The case file is complete.

    • A completed Letter 239C questionnaire for at least one taxpayer is attached to Form 3857.

  3. Forward Form 3857 package to SSA at the following address:

    Social Security Administration
    Division of Earnings Records Operation
    6100 Wabash Avenue
    Baltimore, MD 21215

  4. Forward a list of cases (CN) closed without an SSA Form 3857 response to the IDTVA Scrambled SSN P&A Analyst. The list must be submitted weekly by close of business Friday. If Form 3857 was not sent to SSA, do not include the case on the list.

    Caution:

    Use Secure Messaging to forward a listing of SSN’s and/or taxpayer names via e-mail.

Unallowable (UA) TC 576 Referrals - Scrambled SSN/Mixed Entity
  1. Examination refers open AIMS cases with a UA Hold (TC 576) to AM as "possible scrambled SSN." (Follow local routing procedures.)

    1. Examination secures all returns prior to referral.

    2. Examination processing is suspended pending resolution of the SSN issue.

    3. AM performs all necessary actions to resolve the SSN condition.

    Caution:

    DO NOT ATTEMPT TO RELEASE THE FROZEN REFUND. DO NOT ATTEMPT TO ALLOW EITC ON THESE MODULES.

Unpostable 177
  1. A UPC 177 condition occurs when a module creating transaction attempts to post to the valid segment of an account that has been scrambled. Scrambled indicator 01, 10, 12, or 20 and MFR 08 will be present.

    Note:

    Current procedures do not require a new review of UPC 177 cases. A new review would constitute looking at the case anew in terms of the current procedures that authorize IRS determinations of CN ownership. This is not practical and not necessary.

    Exception:

    A new filer on the SSN requires applying current determination procedures to the case.

  2. The Unpostable Function will contact IDTVA for assistance in resolving the unpostable condition. If there is an open control, the employee who has control will be contacted. If there is no open control, the local UPC 177 Scrambled SSN Coordinator will be contacted. See Scrambled SSN Coordinators.

    Exception:

    The Unpostable Function in Ogden will contact the Kansas City UPC 177 Scrambled SSN Coordinator.

  3. AM must make every effort to supply the Unpostable function with information to resolve the unpostable condition the same day contacted.

    1. Review the case file to locate the correct IRSN. This must be done the same day AM is contacted. If the taxpayer is a new filer on the SSN, AM must obtain an IRSN for the new taxpayer. If it will take longer than 2 business days, advise Unpostables of the time frame necessary to obtain the information.

    2. Input TC 000 with the appropriate scrambled SSN indicator to establish the IRSN, if needed. Exhibit 21.6.2-1, Scrambled SSN Indicators.

    3. If the taxpayer is a new filer on the SSN, apply current determination procedures.

    4. Unpostables will forward copies of the unpostable case, including the return, Form W-2, Form 1099, etc. to IDTVA.

    5. Update the history sheet and case file. Retain photocopies of the return and Form W-2(s) in the case file.

    6. Send a follow-up Form 3857 to SSA with any new information that will assist in resolving the scrambled condition. Include copies of Form W-2(s), with all money amounts deleted except Social Security and Medicare amounts.

Case History Sheet
  1. Form 13708, Mixed Entity/Scrambled SSN Case History Sheet, is required when working a case to be sent to SSA for resolution. All account actions, taxpayer contact and SSA contact must be included on the history sheet. Retain a copy of the completed Case History Sheet with the case. Scan/attach for CIS inclusion only the pages of the Sheet that notate actions taken. The information retained must be sufficient to support the actions taken on the case.

  2. The history sheet should include the following:

    • Common Number

    • IRS or CP Notice date

    • Tax Periods involved

    • Each taxpayer’s name, address and IRSN if applicable

    • Research requests (e.g., IMFOL, MFTRA), include dates

    • DLN of returns requested, include date requested and date received

    • Other TINs and actions, include dates and other actions taken

    • All taxpayer contact

  3. Research information for all cases not sent to SSA for resolution must be recorded on the TIN-Related Problem Research Sheet which can be found on the SERP IRM Supplements page.

NMRG Procedures

  1. General procedures for resolving common types of NMRG cases are listed below. The required action may vary based on statute information. If a taxpayer has tax modules under more than one TIN, every effort must be made to consolidate the accounts under one unique TIN.

    Note:

    If appropriate, move account information to an IRSN to facilitate processing. See IRM 21.6.2.4.4.2, NMRG-DUP One Taxpayer Involved, for general guidelines on the use of an IRSN for resolving NMRG cases.

  2. If you identify a NMRG case while staffing the AM toll-free telephone line, or when providing assistance in a Taxpayer Assistance Center (TAC), do not take any account actions. Prepare Form 4442, Inquiry Referral, and route to Brookhaven IDTVA following the procedures in IRM 21.6.2.3.4, Reassignment of NMRG Cases due to Site Specialization.

    Exception:

    If there is a relevant open control on the account, refer Form 4442 to the employee who has the open control using "Open Control" as the reason for the referral. If the case is on CIS and you have access, leave a case note instead of sending a referral. See IRM 21.5.2.3, Adjustment Guidelines - Research, for additional information. The open control may be on CC TXMOD or CC ENMOD.

    Caution:

    If a case is reassigned to the NMRG unit that does not meet NMRG reassignment criteria, the case will be rejected back to the originator. The NMRG employee will annotate the reason for the rejection on the 4442.

  3. NMRG transcripts generate from both the correct and incorrect accounts when resequencing fails as a result of an entity transaction changing the TIN. The incorrect account may be either a valid or invalid TIN. CC IMFOLE shows the type of transcript generated.

    Caution:

    Individual accounts, such as husband and wife, parent and child, or brother and sister are separate entities and are never merged.

  4. The transcript type is an abbreviated reason for failed merge. The following is a list of transcript types worked by Adjustments:

    • NMRG–DUP

    • NMRG–VEST

    • NMRG–576

    • NMRG–400

    • NMRG–424

    • NMRG–930

    • NMRG–RPS

    • NMRGXXSSN

    • NMRG-VAL

  5. If other NMRG transcripts are received, follow local procedures.

  6. Some modules will require the Assessment Statute Expiration Date (ASED) to be updated to reflect the correct date of the taxpayer's first return. The ASED is based on the first return filed, even if the first return was filed under a wrong TIN. Adjust the ASED, as necessary.

  7. If the valid or invalid account is moved to a temp account and there was a paid user fee (MFT 55) on that account, the user fee should be transferred back to the valid segment to ensure the TP is not charged an additional user fee. For additional information on moving the user fee see IRM 5.19.1.6.4.6.3, User Fee Payment Transfer/User Fee Abatements. Also re-establish the IA under the "to" account if you have been trained, if not, send a referral to Collections to have the IA established with a request to waive the user fee.

  8. Consider erroneous refund and moving refund procedures when working NMRG transcripts.

  9. Consider erroneous abatement and barred assessment procedures when working NMRG transcripts.

  10. Address all issues on all years before closing your case.

NMRG-DUP
  1. A NMRG–DUP transcript generates when:

    • An entire account (entity and all tax modules,) is resequenced from one TIN to another TIN.

    • Both TINs contain a TC 150 for the same period.

    • One or two taxpayers may be involved which may include identity theft.

  2. Other computer checks determine if the TIN is correct for the resequenced accounts. These checks may cause the resequencing action to reject.

NMRG-DUP One Taxpayer Involved
  1. Research the correct and incorrect accounts. If only one taxpayer is involved, process as follows:

    Note:

    If you are resequencing an ITIN; after the resequence posts, send a Form 4442 to the Submission Processing ITIN Unit to have the ITIN revoked. See IRM 3.21.263.8.6, Form 4442, Inquiry Referral, and IRM 21.6.2.4.1.2, Resequencing Actions Required.

    If Then
    Tax data is the same on both accounts
    1. Combine all returns belonging to the taxpayer under the correct account.

      Example:

      Tax years 2010-2015 are on an IRSN. Tax years 2015-2017 are on an ITIN. Move the ITIN to a new IRSN. Move the first IRSN to the ITIN. On the new IRSN, send TY 2016 and 2017 to be reprocessed to the ITIN.

    2. Back out the incorrect account following the procedures in (2) below.

    There is a discrepancy in the tax data
    1. Request returns.

    2. Determine if returns should be consolidated (e.g., additional Form W-2(s), etc.,).

    3. Combine all returns belonging to the taxpayer under the correct account. See example above.

    4. Input adjustment action on the correct account. If a math error is identified, resolve per IRM 21.5.4, General Math Error Procedures.

      Note:

      If an assessment is required to adjust the correct account, and the ASED has expired, see IRM 21.5.2.4.23.9, Moving Assessments.

    5. Resequence the incorrect account to an IRSN. Back out the IRSN following the procedures in (2) below.

    6. Send a Letter 673C to the taxpayer.

    Taxpayer received a refund under both the correct and incorrect account Follow procedures in IRM 21.5.2.4.23.10, Moving Refunds. See also IRM 21.4.5, Erroneous Refunds, if the criteria is met.
    Return is for another tax period, or taxpayer Follow Procedures in IRM 21.6.2.4.2, Mixed Entity Procedures, or IRM 21.6.7.4.2.7.1, Mixed Periods.
  2. In some cases, it may be necessary to back out the account.

    Caution:

    DO NOT adjust statute expired years. DO NOT reprocess statute period returns or a return within 180 days of the ASED. See IRM 21.6.2.4.6, Tax Year Account Move Conditions Applicable for MXEN, SCRM, SSA2 and NMRG Cases.

    1. Input TC 040/041 to resequence the incorrect account to an IRSN, if not already done.

    2. After the resequencing posts, back out the IRSN . Input TC 170.00 if TC 807 or transfer of a timely credit is required. If TC 170/TC 176 is present, input TC 171. Use blocking series 05 with the appropriate hold code.

    3. Input TC 971 action code 001 on the IRSN to cross reference the valid TIN.

    4. Input TC 020 to deactivate the IRSN after all other required actions are complete and posted.

    5. Refile the return under the original return if no adjustment is necessary on the correct account.

    6. Recharge the return for the incorrect account to the correct account, if necessary.

    Note:

    If the incorrect account is an IRSN it isn’t necessary to move it to another IRSN before backing it out.

NMRG-DUP Two Taxpayers Involved
  1. When research shows two taxpayers are involved:

    1. Research CC INOLE and CC NAMES for a different TIN.

    2. Search CC INOLE and CC IMFOL on any TIN found to determine if a valid TIN can be located for the taxpayer posted on the incorrect segment.

      Note:

      Cases that are identified as a true IDT/NMRG issue should be worked if you have been trained, otherwise route per local procedures.

    If And Then
    A valid TIN is determined TC 150 is not posted to the module Input TC 041 to resequence the incorrect account. No further action is necessary.
    A valid TIN is determined TC 150 is present on both modules
    1. Resequence the incorrect account to the IRSN.

    2. Back the data off the incorrect account.

    3. Zero out the IRSN account. Input TC 170 .00 if TC 807 or transfer out of a timely credit is required.

    4. Input TC 971 action code 001 on the IRSN account to cross reference valid TINs.

    5. Input TC 020 to the IRSN account after all other actions are complete and posted.

    The valid TIN cannot be determined  
    1. Correspond with the taxpayer using the Letter 239C.

    2. Suspend for 40 days, 70 days for overseas taxpayers.

    3. Follow mixed entity procedures or reassign as SCRM, as appropriate.

    The good TP posted to the invalid side The bad TP posted to the valid side See IRM 21.6.2.4.2, Mixed Entity Procedures.
    The bad TP posted to the invalid side The good TP posted to the valid side See IRM 21.6.2.4.2, Mixed Entity Procedures.

    Note:

    Accurate and complete research must be performed to determine if the NMRG DUP transcript is the result of an IDT issue. If research shows that the IRSN was established to resolve the IDT issues, link all the related IDT to your case and post the following canned statement in the case notes "This is not a true NMRG issue. There are two separate entities due to prior IDT. See linked CIS case(s) for case history."

NMRG-DUP Processed as Scrambled SSN
  1. See IRM 21.6.2.4.3, Scrambled SSN Case Procedures.

NMRG-VEST
  1. NMRG–VEST transcripts generate when one or both accounts contain a Retention Register (vestigial) record for the same tax period. When one taxpayer is involved, determine which years are on the Retention Register File and review account information for those years.

    If And Then
    There is a TC 150 on only one account for each year The accounts can be merged
    1. Reactivate the retention years in question. For example, if there is a vestigial record for 1999 on both accounts, then reactivate the 1999 tax period for both accounts. See IRM 21.5.2.4.13, Reinstating Retention Register Accounts.

      Reminder:

      All recoverable modules on the "from" account should be reinstated using CC IMFOLB.

    2. Input TC 040/041 to resequence the accounts to the correct TIN when the TC 370 is posted.

    There is a TC 150 on only one account for each year The accounts can be merged after unrecoverable modules, or ones dropped prior to 1994, are reinstated
    1. Send Form 5248, Transfer Request, to Accounting. Include an explanation of the NMRG Condition in the remarks section. Attach a copy of the transcript and a copy of CC IMFORT for each module that needs to be reinstated by Accounting.

      Caution:

      Only the years preventing the merge should be reinstated.

    2. Ensure there is an established name line year for the module being reinstated. If more than one year needs to be reinstated, establish the name line year on the earliest module.

    3. When the modules are reinstated, resequence the accounts to the correct TIN.

    There is a TC 150 on both accounts for the same year The taxpayer filed two returns using two TINs, the accounts cannot be merged Follow procedures in IRM 21.6.2.4.4.2, NMRG-DUP One Taxpayer Involved.
  2. When two taxpayers are involved, see IRM 21.6.2.4.4.3, NMRG-DUP Two Taxpayers Involved.

NMRG-576
  1. A NMRG-576 transcript is issued when a debit module or module with a TC 570 attempts to merge with a module containing a TC 576.

  2. When one taxpayer is involved, contact Examination to see if input of TC 577, to release TC 576, is possible. After the TC 577 posts, see IRM 21.6.2.4.4.2, NMRG-DUP One Taxpayer Involved.

  3. When two taxpayers are involved, see IRM 21.6.2.4.4.3, NMRG-DUP Two Taxpayers Involved.

NMRG-400
  1. NMRG-400 transcripts generate when either account contains a module with a TC 400 Freeze (Account Transfer Out), and there is a module with an equal tax period in the other account.

  2. Examine the accounts to determine if an account consolidation is required. If so, take the following action:

    1. Prepare Form 12810 requesting reversal of the TC 400.

    2. Attach a copy of the transcript to the memo and forward to the Accounting function.

    3. Suspend the case (follow local procedures) until you receive a reply indicating the TC 400 is reversed.

    4. Input TC 040/041 to consolidate the accounts, after reply is received.

NMRG-424
  1. NMRG-424 transcripts generate when a resequence fails because one or both accounts contain a module with an unreversed TC 424.

  2. Contact Examination for instructions. If TC 424 is reversed, follow normal NMRG-DUP procedures.

NMRG-930
  1. NMRG-930 transcripts generate when:

    • Two accounts attempt to merge as a result of an entity transaction changing TIN

    • Both accounts contain a TC 930 posted for the same tax period

  2. Reverse TC 930 on the incorrect account.

NMRG-RPS
  1. NMRG-RPS transcripts generate when:

    • Two accounts attempt to merge

    • Both accounts contain modules for the same period

    • Both modules contain a TC 150 with multiple TC 610s (one is a Remittance Processing System (RPS) payment)

    • The TC 610 and TC 150 DLNs do not match

    • The payment DLN carries the return DLN plus 400 in the Julian date and is read by the computer as a return

NMRG-RPS One Taxpayer Involved
  1. When one taxpayer is involved:

    If Then
    A TC 150 is on both the accounts or only on the incorrect account
    1. Resequence the incorrect account to an IRSN, using TC 040/041.

    2. Transfer TC 610 to the correct TIN after the resequencing is complete.

    3. Zero out IRSN. Input TC 170 .00 if TC 807 or transfer out of a timely credit is required. If a TC 170/176 is present, input TC 171. Use blocking series 05 and Hold Code 4.

    4. Input TC 971 action code 001 on the IRSN account to cross reference correct account.

    5. Input TC 020 to the IRSN after all actions are complete and posted.

    6. Consolidate data on the correct account, if necessary.

    A TC 150 is not posted on the correct account Reprocess the return.
    The return being input is delinquent and a TC 140 is present on the module Input TC 599 cc 094, Taxable Return secured or 096 Non-taxable return secured (Return shows no tax liability before prepaid credits) and TC 971 action code 017.
    A TC 150 is only on the correct account
    1. Resequence the incorrect account to an IRSN using TC 040/041.

    2. Transfer TC 610 to the correct account after the resequence is complete.

    3. Input TC 020 to the IRSN account after all actions are complete and posted.

NMRG-RPS Two Taxpayers Involved
  1. Research for a valid TIN for the taxpayer posted to the incorrect account.

    If a valid TIN is determined AND Then
    TC 150 is not posted to the module Input TC 040/041 to incorrect account to resequence account.
    A TC 150 is present on both modules The data must be backed off the incorrect account.
    A TC 150 is posted on the correct valid TIN Combine the tax data.
    TC 150 is not posted on the correct valid TIN Reprocess the return.
    The return being reprocessed is delinquent and a TC 140 is on the module Input TC 599 cc 094, Taxable Return secured or 096 Non-taxable return secured (Return shows no tax liability before prepaid credits) and TC 971 action code 017.
  2. If a valid TIN cannot be determined, correspond with both taxpayers , refer to IRM 25.23.4, IDTVA Paper Process.

Scrambled SSN Transcripts
  1. A NMRG-SCRAMBLED SSN (NMRGXXSSN) transcript generates when a resequencing account fails to merge because either the "from" or the "to" account contains an SCI of 01, 12, 13, 20, or 23 and an MFR 08. Reassign the case as SCRM. Refer to the AM Site Specialization Temporary Holding Numbers listing for the appropriate number.

  2. A NMRG-SCRAMBLED SSN (NMRGXXSSN) transcript may also generate when a resequencing account fails to merge because the SSN on the "to" account is equal to the spouse’s SSN in any name line on the "from" account. See Mixed Entity procedures to help determine if any actions need to be taken.

NMRG-VAL Transcripts
  1. NMRG-VAL or NMRG-FTHBCR Transcripts generate when either or both of the following conditions are present:

    • Both the" from" and "to" accounts contain First Time Homebuyer Credit (FTHBC) amounts for the primary taxpayer

    • Both the "from" and "to" accounts contain First Time Homebuyer Credit (FTHBC) amounts for the secondary taxpayer

  2. The FTHBC can be found on CC IMFOLF. Adjust the FTHBC as appropriate. See IRM 21.6.3.4.2.10.7, First-Time Homebuyer Adjusting Accounts, and the NMRG - First Time Homebuyer Credit job aid, for additional information.

  3. Follow Erroneous Refund procedures to recover any erroneously refunded FTHBC credits. See IRM 21.4.5.5.2, Category A2 Erroneous Refunds. For more on the FTHBC credit, see IRM 21.6.3.4.2.10, First-Time Homebuyer Credit.

TDA, NMRG Issue
  1. NMRG-TDA transcripts are received initially by CSCO. Per IRM 5.19.10.5.12.1, Processing NOMRG-TDA Transcript, CSCO will reassign to AM if there is a TC 150 posted on both numbers.

  2. NMRG-TDA transcripts received in AM should be worked like NMRG-DUP. See IRM 21.6.2.4.4.1, NMRG-DUP.

UPC 134-3
  1. UPC 134-3 generates on CC ENMOD when a resequence fails because the "from" account contains a TC 898 within six years of the original offset date.

  2. ) If the "from" account is not the invalid segment of the "to" account,

    Example:

    "From" account is an ITIN and "to" account is an SSN.

    Example:

    "From" account is the invalid segment of someone else’s SSN, "to" account is the taxpayer’s valid SSN.

    take the following actions:

    1. If appropriate reverse the TC 898 following the instructions in IRM 21.4.6.5.19, Re-sequence Cases.

    2. Input a CIS case note indicating each TC 898 reversed and the tax year.

    3. Follow NMRG-DUP instructions. See IRM 21.6.2.4.4.1, NMRG-DUP.

    4. Input a CIS case note indicating when the merge transaction is input.

    Exception:

    If the "from" account is a revoked ITIN and there is an un-reversed TC 898 within 6 years of offset, follow No Move Procedures for all modules. See IRM 25.23.4.22, Not Moving Specific Year Account Information.

    Note:

    TC 971 AC 001 cannot be input to an account with a revoked ITIN. The transaction will unpost with UPC 151-0.

  3. If the "from" account is the invalid segment of the "to" account and both accounts have a valid name control, take the following actions:

    Caution:

    Do not attempt to reverse the TC 898. An adjustment input to the invalid segment will attempt to post to the valid segment.

    1. Verify that no other conditions are present on the invalid segment which would prevent a successful merge. See IRM 21.6.2.4.1.2, Resequencing Action Required.

    2. Input TC 040 to move the valid segment of the TIN to an Internal Revenue Service Number (IRSN).

      Note:

      If the merge is successful the valid segment will become available. Once the DM-1 tape runs the invalid segment will systemically resequence to the valid segment.

      Caution:

      The TC 898 NMRG condition will be bypassed only if the resequence is initiated systemically.

    3. Once the "from" account has merged to the valid segment, merge the IRSN back to the valid TIN.

Revalidation (REVAL) Transcripts

  1. REVAL transcripts generate from the invalid TIN or from the ITIN of a failed merge. Apply the following procedures for REVAL cases.

  2. The transcript type is the abbreviated reason for the failed merge. The Adjustment Function works the following transcripts:

    • REVAL-DUP

    • REVAL-VEST

    • REVAL-576

    • REVAL-400

    • REVAL-424

    • REVAL-RPS

    • REVALXXSSN

  3. Consider erroneous refund and moving refund procedures when working NMRG transcripts.

  4. Consider erroneous abatement and barred assessment procedures when working NMRG transcripts.

REVAL-One Taxpayer (One Sided)
  1. A one-sided REVAL is a successful merge posted to the invalid side of the TIN. Only one taxpayer is involved.

  2. Input TC 041 with the taxpayer's correct first name line, using the year digit of the most recent module account. This forces the account to the proper segment. See IRM 3.13.5.126, Invalid Segment Bypass (TC 041).

REVAL-DUP One Taxpayer Involved
  1. REVAL-DUP transcripts generate when:

    1. The SSA Data tape changes the validity of a Name Control (NC) and causes an attempted merge of two accounts.

    2. Each account contains a TC 150 for the same period(s).

  2. These transcripts generate automatically with the quarterly update of the SSA Data tape.

    1. Transcripts contain data on both the "to" and "from" accounts.

    2. REVAL-DUP transcripts may involve one or more taxpayers.

  3. Research the correct and incorrect accounts. If only one taxpayer is involved, take the following action on the incorrect account:

    1. Input TC 041 to resequence the account to an IRSN.

    2. Zero out the IRSN account after the merge to the IRSN has been completed.

    3. Input TC 170 .00 when zeroing the account if TC 807 or transfer of a timely credit is required. If a TC 170/TC 176 is present, input TC 171. Use blocking series 05, with hold code 4.

    4. Input TC 971 action code 001 on the IRSN to cross reference the valid TIN.

    5. Input TC 020 to the IRSN after all actions are complete and posted.

  4. Take the following action on the correct account:

    1. Input an entity change in the same cycle as the back out of the IRSN account, for the latest period name line to correct the name and address.

      Note:

      A NMRG-DUP case is created if the name is changed on the correct account before the resequence posts. DO NOT input an entity change if the NC is accurate.

    2. Analyze the returns to determine if adjustment action is necessary.

    If Then
    An adjustment is necessary Consolidate the returns on the correct account.
    No adjustment is necessary
    1. Input a TC 290 .00 two cycles after the entity change posts.

    2. Use the appropriate refile blocking series.

    3. Attach both returns to the adjustment document.

  5. If the taxpayer received a refund under both the correct and incorrect accounts, follow erroneous refund procedures in IRM 21.4.5, Erroneous Refunds.

REVAL-DUP Two Taxpayers Involved
  1. If a REVAL-DUP transcript generates with two taxpayers involved, follow instructions in IRM 21.6.2.4.4.3, NMRG-DUP Two Taxpayers Involved.

REVAL-VEST
  1. A REVAL-VEST transcript generates when a resequence fails and both of the following conditions exist:

    • A retention record is on one account and the same module is on the other account (either on retention or MF)

    • The SSA Data tape changes the validity of name control causing it to post to the invalid side or on the ITIN.

  2. Research retention accounts for (valid and invalid for same TIN or on the ITIN and SSN).

    If Then
    Consolidation is unnecessary or impossible after the resequence attempt Leave an explanation in a case note on CIS.
    Consolidation is necessary (consider statute of limitations)
    1. Obtain an IRSN.

    2. Reactivate the retention years in question. See, IRM 21.5.2.4.13, Reinstating Retention Register Accounts.

    3. Input TC 041 to resequence the invalid TIN to the IRSN.

TC 370 Posts-One Account Has a TC 150
  1. When the TC 370 posts and for the same module, only one account has a TC 150:

    If Then
    The NC is not accurate on the account Input an entity change to correct the name for the latest period name line.
    An entity change was made on the correct account Input TC 041 to merge the incorrect account on the IRSN to the correct account after the entity change has posted.
TC 370 Posts - Both Accounts Have TC 150
  1. When TC 370 posts and there is a TC 150 on both the correct and IRSN accounts for the same module, analyze them to determine if an adjustment action is necessary.

    If Then
    The correct account, same module, will not be adjusted Input TC 020 on the IRSN.
    The NC is not accurate on the correct account Input an entity change to correct the name for the latest period name line.
    The correct account's same module will be adjusted (e.g., 25 percent omission of income)
    1. Zero out the IRSN's same module. Input TC 170 .00 if TC 807 or transfer of a timely credit is required. If TC 170/176 is present, input TC 171.

    2. Use blocking series 05, with appropriate hold code.

    3. Input TC 971 action code 001 on the IRSN account to cross-reference the valid SSN.

    4. Input TC 020 to IRSN account after all actions to be taken on the IRSN are complete and posted.

    5. Adjust correct account's same module.

    6. Correct the name for the latest period name line in the same cycle as the back out of the IRSN.

  2. Adjust the correct account if the adjustment action is necessary for any other module. This can be done only after the name change, if input, is posted.

REVAL-576
  1. A REVAL-576 transcript generates when:

    • A debit module or module with a TC 570 attempts to merge with a module containing a TC 576

    • The TIN validity of NC changes

  2. Contact Examination for input of TC 577 to release the TC 576. Take the following action after the TC 577 posts:

    If Then
    Only one account contains a TC 150 Input TC 041 to resequence the account.
    Both accounts contain a TC 150 Follow REVAL-DUP procedures.
REVAL-400
  1. REVAL-400 transcripts generate when the file validity to which the account is returned is opposite to the correct account's validity.

  2. Follow instructions in IRM 21.6.2.4.4.7, NMRG-400.

REVAL-424
  1. REVAL-424 transcripts generate when a resequence fails because:

    • One or both accounts contain a tax module with an unreversed TC 424

    • The TIN validity of the file to which the account is returned is opposite to the account's TIN validity

  2. After TC 424 is reversed, follow procedures in IRM 21.6.2.4.4, NMRG Procedures.

REVAL-RPS
  1. REVAL-RPS transcripts generate when:

    • The SSA Data tape changes the validity of the NC causing two accounts to attempt to merge

    • Both accounts contain a combination of a TC 150 and multiple TC 610 (one is an RPS) for the same tax period

REVAL-RPS One Taxpayer Involved
  1. Action required when one taxpayer is involved:

    1. Resequence the incorrect account to an IRSN using TC 041.

    2. Transfer the TC 610 to the correct account after the resequence is complete.

    3. Zero out the IRSN account, using the appropriate hold code. Input TC 170 .00 if a TC 807 or transfer out of a timely credit is required. Input TC 171 if TC 170 TC 176 is present.

    4. Input TC 971 action code 001 on the IRSN to cross-reference correct TIN.

    5. Input TC 020 to the IRSN after all other actions are complete and posted.

    6. Correct the name for latest period name line, on correct account, in the same cycle as the back out of the IRSN.

REVAL-RPS Two Taxpayers Involved
  1. Research for a valid TIN for the taxpayer posted to the incorrect account when two taxpayers are involved.

    If a valid TIN is determined and Then
    TC 150 is not posted to the module Input TC 040/041 to the incorrect account to resequence the account.
    A TC 150 is posted on both accounts
    1. The data must be backed off the incorrect account.

    2. Follow procedures in IRM 21.6.2.4.5.11, REVAL - RPS One Taxpayer Involved.

    TC 150 is posted on the correct valid TIN Combine the tax data.
    TC 150 is not posted on the correct valid TIN Reprocess the return.
    The return being reprocessed is delinquent with a TC 140 present on the module Input TC 599 cc 094, Taxable Return secured or 096, Non-taxable return secured (Return shows no tax liability before prepaid credits) and TC 971 action code 017.
  2. Correspond with both taxpayers if a valid TIN cannot be determined. If both taxpayers claim a SSN; work as a scrambled SSN case.

REVALXXSSN
  1. REVAL SCRAMBLED SSN (REVALXXSSN) transcripts generate if the validity of the CN and SSN are opposite the validity of the segment to which it was returned after a failed merge on a scrambled SSN case. Reassign case as SCRM. Refer to the AM Site Specialization Temporary Holding Numbers listing for the appropriate number.

  2. A REVAL SCRAMBLED SSN (REVALXXSSN) transcript may also generate when a resequencing account fails to merge because the SSN on the "to" account is equal to the spouse’s SSN in any name line on the "from" account. See Mixed Entity procedures for help determining if any actions need to be taken. See IRM 21.6.2.4.2, Mixed Entity Procedures.

Tax Year Account Move Conditions Applicable for MXEN, SCRM, SSA2 and NMRG Cases

  1. The tax account information should be moved when any of the following conditions are met:

    • The Assessment Statute Expiration Date (ASED) is open.

      Reminder:

      If the ASED is expired or imminent on a tax return to be reprocessed, NEVER abate tax on the "from" account until the reprocessing is complete and the tax has posted.

      Caution:

      The ASED does not apply on a case that has been determined a nullity. The return must be considered valid in order for the ASED to apply. Refer to IRM 25.6.1.6.14, Criteria for Establishing a Statute of Limitations Period, paragraph (3)(b), for additional information.

    • There is a "-C" freeze on the tax year account. A "-C" freeze indicates the taxpayer is/was in a combat zone and the time period for filing a return for that tax year may have been extended.

      Caution:

      Combat Zone (CZ) accounts, identified by a -C freeze, indicate a taxpayer who is or was serving in a designated combat zone area. NOTE: The -C freeze stays on the account for historical purposes even after the taxpayer is no longer in the CZ. See IRM 5.19.10.6.3, Combat Zone Freeze Code, (1). When working an account that contains a -C freeze, additional research is required to determine that taxpayer’s CZ status. Research CC IMFOLE for the Combat indicator on Line 11, to determine the correct action to take based on the following: If Combat indicator is "1" , then the taxpayer is still serving in a combat zone. Any compliance activity such as assessing or collecting tax is prohibited. However, if the taxpayer has other issues or requests information, you may work these other issues and contact the taxpayer if needed. If Combat indicator is "2" , then the taxpayer is no longer a combat zone participant. Follow normal IRM procedures to work the case.

    • There is a balance owed on the tax year account.

      Note:

      Contact Automated Underreporter (AUR) if there is an AUR assessment which appears to be incorrect. See Exhibit 4.13.7-6Addresses for AUR Reconsideration Requests, to determine who to contact. The contact may give you approval to reverse the AUR assessment. Document your AUR contact and their response on the CIS case.

    • The tax year account has an overpayment that must be refunded from the "to" account.

      Caution:

      If there is an indication another area is considering action on the tax year account, e.g., an open control by Exam, AUR, Collections, etc., contact the area. The tax year may need to be moved based on the action they are taking on the account. Document your contact in the CIS notes.

Not Moving Specific Year Account Information
  1. Take the following actions when you have determined, per IRM 21.6.2.4.6, Tax Year Account Move Conditions Applicable for MXEN, SCRM, SSA2 and NMRG Cases, that it is not necessary to move posted tax account information. Unless specifically noted, the actions listed in this paragraph apply to MXEN, SCRM, SSA2, and NMRG cases. The bullet items listed here are related to the actions required on the "IRSN" .

    • Refer the case to your Lead or designated individual for approval not to move the tax account information. If approved, the Lead or designated individual must notate approval in the CIS Case Notes. CSR/TE must input a case note of "not moved" or specific determination made, prior to requesting approval.

    • Establish a name line on the "to" account for the tax year not being moved. Include the name(s), filing status, and spouse's SSN (if applicable) as shown on the return.

    • Input a TC 971 AC 001 with the return received date on the "from" account to cross-reference the "to" account.

    • After the name line has posted on the "to" account, input a TC 971 AC 017 on the "to" account to cross-reference the "from" account. Use the received date of the return not being moved.

    • For MXEN, SCRM, and SSA2 cases, enter the following CIS case note, filling in the applicable year: "Tax Year YYYY not filed by TP. See TC 971 AC 001 X-Ref" .

      Note:

      If reactivation requires obtaining microfilm, a note on CIS is sufficient indicating the location of the cross-reference tax year.

     

    Caution:

    The ASED does not apply on a case that has been determined a nullity. The return must be considered valid in order for the ASED to apply. Refer to IRM 25.6.1.6.14, paragraph (3)(b), Criteria for Establishing a Statute of Limitation Period, for additional information. If the return is determined to be valid, an IRSN should be obtained in order to process the return for Taxpayer B.

  2. Take the following additional actions for the tax year(s) that will remain posted on the account. These additional actions listed in this paragraph apply ONLY to MXEN, SCRM, SSA2 cases. The bullet items listed here are related to the actions required on the "SSN" .

    • For the "from" tax year(s) account(s), (the tax year(s) account(s) not being moved), change the name line on the tax year(s) to: "NOT FILED] NAMC" . "NAMC" here represents the name control of the taxpayer who owns the SSN. You will type in the name control of the SSN owner instead of typing in "NAMC" . Also update the address to the most current address, if applicable.

    • If the return that posted to the Common Number, on the "from" account tax year has Self-Employment (SE) income, input CRN 878/CRN 895 and/or CRN 879/CRN 896 to zero out primary SE and Medicare income. Input CRN 892/CRN 899 to zero out the primary and secondary tip income.

    • If an overpayment on the tax year account not being moved is over one-year old, move the overpayment to excess collections.

      Note:

      If the taxpayer has a valid TIN and a refund should be issued, the tax year account must be moved to the taxpayer's valid TIN.

    • Any overpayment that has been offset to a Bureau of Fiscal Services debt must be reversed, using hold code 4. If the overpayment is over one year old, move it to excess collections. A letter must also be sent to the taxpayer who has the FMS debt, notifying them of the reversal. If the BFS offset is over 6 years old, refer to IRM 21.4.6.4.2.12, TOP Offsets Involving ID Theft.

    • Reverse any IRS offsets. If the overpayment is over one-year old, move the overpayment to excess collections. A letter should be sent to the SSN owner informing them of the overpayment reversal.

    • If adjusting 2008 and FTHBC was claimed by the bad taxpayer, see IRM 21.6.4.4.18.4, Manually Adjusting the Recapture Amount, to update the CC IMFOLF information.

Moving Specific Year Account Information
  1. If there are 180 or more days remaining before the ASED expires, reprocess the return. See IRM 21.5.5.5.5, Processing/Reprocessing CIS Tax Returns, and IRM 21.5.2.4.23, Reprocessing Returns/Documents.

  2. If there are less than 180 days remaining before the ASED expires, refer the return to Statute for a prompt assessment.

    Caution:

    The ASED does not apply on a case that has been determined a nullity. The return must be considered valid in order for the ASED to apply. Refer to IRM 25.6.1.6.14, Criteria for Establishing a Statute of Limitations Period, paragraph (3) (b), for additional information.

     

    Reminder:

    If the tax year account is within 180 days of the ASED, DO NOT abate tax on the "from" account prior to the tax being posted on the "to" account. Once the return has been reprocessed and the tax information has posted, or a prompt assessment has been made on the "to" account, the "from" account may be backed off to the correct amount.

  3. If the ASED is expired for the tax year(s) at issue, and move conditions are met, take action to move the tax account information as appropriate. If applicable, initiate a manual account transfer using Form 12810, Account Transfer Request Checklist.

    Note:

    After the tax account information has posted, input the applicable item reference numbers (IRN) to the "to" account (e.g., IRN 888, 896).

  4. For general information when the tax year account must be transferred via Form 12810 per the guidelines above, see IRM 25.6.1.9.9.3 , Correct Records on Expired Statute Periods. Also see (7) below to expedite the processing and/or prevent delays of Form 12810.

  5. When the tax year account must be transferred via Form 12810, the tax year account must be in debit or zero balance. Accounting will reject any requests where the tax year account is showing or will show, once the Form 12810 transfer has been completed, a credit balance. Credit balances must be resolved expeditiously, whether as a refund to the correct taxpayer, if allowable, or as a transfer to Excess Collections. Make sure the entity information for the IRSN account has posted and all freeze conditions are resolved prior to sending the Form 12810 to Accounting.

  6. If all other statute expiration dates have expired and there is no indication of activity or pending activity on the tax year account, do not move an incorrectly posted tax year if the Collection Statute Expiration Date (CSED) is expired or has less than 10 months remaining before it expires. No additional account moving action is required on these tax years.

  7. See the following IRM sections for proper processing of Form 12810:

    • Form 12810 must be processed within a six-day timeframe per IRM 3.17.21.7.1, Master File Account Transfers-Out, (1).

      Reminder:

      Ensure you submit Form 12810 to the appropriate accounting function via EEFax or e-mail.

    • Any forms that need to be rejected by SP will be sent back to the originator using an electronic format, by e-mail or EEFax. This will prevent unnecessary delays, per IRM 3.17.21.7, Processing Account Transfers to the Master File (IMF/BMF, (1).

    • The employee assigned to complete the transfer needs to open a control base, using category IRRQ, when it is determined that the transfer request will be processed, per IRM 3.17.21.7.1, Processing Account Transfers to the Master File (IMF/BMF), (8).

Scrambled SSN Indicators

The following two digit scrambled indicators pertain to scrambled SSN cases. Some of the indicators are no longer input on newly processed cases. These obsolete indicators are duly noted, and are included in the list for the purpose of identifying actions taken on residual cases.

Indicator Used when
01 Completed Letter 239C questionnaire received from at least one taxpayer. Form 3857 sent to SSA.

Note:

This indicator is no longer input on newly processed cases.

09 Scrambled indicator needs to be turned off.
10 Account is being scrambled. Form 3857 is not sent to SSA.
12 True/Default True Scrambled SSN case. Form 3857 sent to SSA.
13 SSN not valid for federal tax purposes.
20 Case closed, no Letter 239C questionnaire received or SSA response is insufficient to resolve scrambled SSN condition.

Note:

This indicator is applicable only for cases worked per prior versions of this IRM.

21 Case closed, scrambled SSN condition resolved with SSA Form 3857 response or an SSA SSN verification printout.

Note:

The SSA SSN verification printout is no longer sufficient proof of ownership of the SSN. SCI 21 is applicable for cases worked per prior versions of this IRM.

22 Case closed, scrambled SSN condition resolved with SSA Form 3857 response. Information indicates case was a True (non-default) scrambled SSN.
23 Case closed with SSA Form 3857 response which indicates SSN is not valid for federal tax purposes.

Note:

This indicator is applicable only for cases worked per prior versions of this IRM.

24 Reserved

Definitions

Term Definition
Common Number The taxpayer identification number (TIN) being used by two or more taxpayers.
DM-1 File A database of name controls and associated TINs. See IRM 3.13.5.14, Data Master One (DM-1) File.
"From" Account The account which needs to be moved to the new TIN or the valid segment.
Generated Transaction Often called Computer Generated. Refers to an action created by the computer after input of data on an account.
Merge Two compatible accounts are combined into one on the Master File.
Primary Taxpayer The IMF taxpayer listed on the first name line of a joint return.
Resequence The moving of data from one account to another account on the Master File.
Secondary Taxpayer The IMF taxpayer listed on the second name line of a joint return.
Tax Module Part of a taxpayer’s account which reflects tax data for one type of tax and one tax period.
"To" Account The new TIN or valid segment.
Valid When the taxpayer’s Social Security Number and the name control match the DM-1 file.
Validation Digit Indicates whether a TIN is valid or invalid.
0 - Valid TIN
1 - Invalid TIN