25.23.10 Compliance Identity Theft Case Processing

Manual Transmittal

September 08, 2017

Purpose

(1) This transmits revised IRM 25.23.10, Compliance Identity Theft Case Processing.

Material Changes

(1) IRM 25.23.10, Various editorial changes and IRM cross references updated throughout entire IRM.

(2) IRM 25.23.10.1 - Revised title to Program, Scope and Objectives.

(3) IRM 25.25.10.1 (6) Added additional IRM sections that may be utilized.

(4) IRM 25.23.10.1.1 New subsection, added as part of the new IRM Internal Control requirement.

(5) IRM 25.23.10.1.2 New subsection, added as part of the new IRM Internal Control requirement.

(6) IRM 25.23.10.1.3 New subsection, added as part of the new IRM Internal Control requirement. All subsequent sub-sections were renumbered.

(7) IRM 25.23.10.1.4 Additional acronyms were added to the list.

(8) IRM 25.23.10.1.4 Updated list to alphabetical order.

(9) IRM 25.23.10.2 Revised entire section for clarity

(10) IRM 25.23.10.2.1, Additional CIS Case Controls - New guidance

(11) IRM 25.23.10.3, Entire section was updated. Instructions were added for usage of the Letter 4674C as the IDTVA - Compliance closure letter. New versions of the letters published on 10/02/2017. Instructions were updated based on the changes to the letters.

(12) IRM 25.23.10.3.1(6) Added new reminder.

(13) IRM 25.23.10.4 Corresponding with the Taxpayer - New guidance.

(14) IRM 25.23.10.4 - IRPTR/IDRS Data Decision Tree for Returns containing Self-Employment Income, Removed section instructions can now be found in IRM 25.23.4.12.4 TIN-Related Problems for IRP Data, Refund Scheme or Schedule C, Case Processing.

(15) IRM 25.23.10.5, Types of Identity Theft - New guidance.

(16) IRM 25.23.10.5.1, Income or Employment Related IDT - New guidance.

(17) IRM 25.23.10.5.2, Refund Related IDT - New guidance.

(18) IRM 25.23.10.5.3, IRS Identified Identity Theft - New guidance.

(19) IRM 25.23.10.6, Referrals from Taxpayer Advocate Service - New guidance. All subsequent sections were renumbered.

(20) IRM 25.23.10.7, Unprocessed/Secured Returns - General, new guidance. Prior existing sections were realigned and renumbered as sub-sections.

(21) IRM 25.23.10.7.1, Unprocessed/Secured Returns - Initial Screening - Guidance was formerly found in IRM 25.23.10.4, Unprocessed/Secured Returns - Initial Actions. Section was updated with additional guidance.

(22) IRM 25.23.10.7.2, Unprocessed/Secured Returns - Technical Guidance - Guidance was formerly found in IRM 25.23.10.4.1, Unprocessed/Secured Returns - Technical Guidance. Section was updated with additional guidance.

(23) IRM 25.23.10.7.2.1, Incomplete Returns -new guidance.

(24) IRM 25.23.10.7.2.2, Expiration of the Suspense Time Frame - Signed Returns - new guidance.

(25) IRM 25.23.10.8, Identity Theft Allegations on Tax Years 2006 and prior.- New guidance. All subsequent sections were renumbered.

(26) IRM 25.23.10.9 Identity Theft Cases with Multiple Function Involvement - Added specialty to the title.

(27) IRM 25.23.10.9.1(4) Added new paragraph advising that AUR does not need to be contacted when working a Recon case.

(28) IRM 25.23.10.9.2.1 Refund Hold Program, Added tolerance for income tax refunds and credit elects.

(29) IRM 25.23.10.10, Revised instructions for clarity.

(30) IRM 25.23.10.10.1, Revised instructions for clarity.

(31) IRM 25.23.10.10.1(2) Added hyperlinks to Appeals e-mail address throughout table.

(32) IRM 25.23.10.10.3(4) - Updated IDT e-mail address.

(33) IRM 25.23.10.11(2) Added Specialty Collections to paragraph.

(34) IRM 25.23.10.11(3) Revised instruction for clarity.

(35) IRM 25.23.10.11(4), Added instructions regarding input of a TC 971 AC 850.

(36) IRM 25.23.10.11(10) Revised instruction for clarity.

(37) IRM 25.23.10.11(12) Revised instruction for clarity.

(38) IRM 25.23.10.11(13) Revised for clarity.

(39) IRM 25.23.10.11(18) Added Specialty Collections to paragraph and revised for clarity.

(40) IRM 25.23.10.12, Compliance Case Processing - New guidance

(41) IRM 25.23.10.12.1, IDTVA-C CSCO Identity Theft Case Processing - Contains guidance previously found in IRM 25.23.6

(42) IRM 25.23.10.12.1.1, IDTVA-C CSCO Initial Receipt Clerical Actions - New guidance

(43) IRM 25.23.10.12.1.2, Automated Substitute for Return (ASFR) Case Processing - Contains guidance previously found in IRM 25.23.6.2

(44) IRM 25.23.10.12.1.3, Return Delinquency Identity Theft - Contains guidance previously found in IRM 25.23.6.3

(45) IRM 25.23.10.12.1.4, Offer In Compromise (OIC) - Identity Theft Offer Determinations - Contains guidance previously found in IRM 25.23.6.4

(46) IRM 25.23.10.12.1.5, Offer In Compromise (OIC) - Identity Theft Referral Procedures - Contains guidance previously found in IRM 25.23.6.5

(47) IRM 25.23.10.12.2, IDTVA-C ACSS Identity Theft Case Processing - Contains guidance previously found in IRM 25.23.5

(48) IRM 25.23.10.12.2.1, IDTVA-C ACSS Receipt Procedures - Contains guidance previously found in IRM 25.23.5.1

(49) IRM 25.23.10.12.2.1.1, IDTVA-C ACSS Initial Receipt Clerical Actions - Contains guidance previously found in IRM 25.23.5.1.1

(50) IRM 25.23.10.12.2.1.2, IDTVA-C ACSS Screener Procedures - Contains guidance previously found in IRM 25.23.5.1.1.1

(51) IRM 25.23.10.12.2.2, IDTVA-C ACSS Preliminary Research Needed for Determining Identity Theft on Cases Meeting ACS IDT Criteria - Contains guidance previously found in IRM 25.23.5.2

(52) IRM 25.23.10.12.2.3, Processing Identity Theft Correspondence - Contains guidance previously found in IRM 25.23.5.3

(53) IRM 25.23.10.12.2.4, Identity Theft balance Due Return (TC 150) Not Resulting From Additional Assessment - Contains guidance previously found in IRM 25.23.5.4

(54) IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues - Contains guidance previously found in IRM 25.23.5.6

(55) IRM 25.23.10.12.2.6, Levies - Contains guidance previously found in IRM 25.23.5.7

(56) IRM 25.23.10.12.2.6.1, Active Levies - Contains guidance previously found in IRM 25.23.5.7.1

(57) IRM 25.23.10.12.2.6.2, Addressing Outstanding Levies - Contains guidance previously found in IRM 25.23.5.7.2

(58) IRM 25.23.10.12.2.6.3, Addressing ACS Paper Levies - Contains guidance previously found in IRM 25.23.5.7.3

(59) IRM 25.23.10.12.2.6.4, Addressing Outstanding Federal Payment Levy Program (FPLP) Levies - Contains guidance previously found in IRM 25.23.5.7.4

(60) IRM 25.23.10.12.2.6.5, Identity Theft and Disposition of Levy Proceeds - Contains guidance previously found in IRM 25.23.5.7.5

(61) IRM 25.23.10.12.2.6.6, Returning Levy Proceeds to ID Theft Victims (SSN Owner) - Contains guidance previously found in IRM 25.23.5.7.6

(62) IRM 25.23.10.12.2.6.7, Returning Proceeds from Wrongful Levy (Non-Owner) - Contains guidance previously found in IRM 25.23.5.7.7

(63) IRM 25.23.10.12.2.6.8, Follow-up Actions on ID Theft Accounts Involving Wrongful Levy - Contains guidance previously found in IRM 25.23.5.7.8

(64) IRM 25.23.10.12.2.7, Oscar "O" Inventory - Contains guidance previously found in IRM 25.23.5.8

(65) IRM 25.23.10.12.2.7.1, O0 Inventory – Managerial/ACSS CIS Referrals - Contains guidance previously found in IRM 25.23.5.8.1

(66) IRM 25.23.10.12.2.7.2, O2 Inventory – IDTVA-C ACSS IDT Correspondence - Contains guidance previously found in IRM 25.23.5.8.2

(67) IRM 25.23.10.12.2.7.3, O3 Inventory - IDTVA-C BMF - Contains guidance previously found in IRM 25.23.5.8.3

(68) IRM 25.23.10.12.2.7.4, O4 Inventory – IDTVA-C ASFR Referrals - Contains guidance previously found in IRM 25.23.5.8.4

(69) IRM 25.23.10.12.2.7.5, O5 Inventory – IDTVA-C AUR Referrals - Contains guidance previously found in IRM 25.23.5.8.5

(70) IRM 25.23.10.12.2.7.6, O6 Inventory – Other Functional Referrals - Contains guidance previously found in IRM 25.23.5.8.6

(71) IRM 25.23.10.12.2.7.7, O7 Inventory – IDTVA-C Examination Referrals - Contains guidance previously found in IRM 25.23.5.8.7

(72) IRM 25.23.10.12.2.7.8, O8 Inventory – Referrals to Designated Identity Theft Adjustment (DITA) - Contains guidance previously found in IRM 25.23.5.8.8

(73) IRM 25.23.10.12.2.7.9, O9 Inventory - Referrals From ACS Compliance - Contains guidance previously found in IRM 25.23.5.8.9

(74) IRM 25.23.10.12.2.8, Expired O Inventories - Contains guidance previously found in IRM 25.23.5.9

(75) IRM 25.23.10.12.2.8.1, General Guidelines - Contains guidance previously found in IRM 25.23.5.9.1

(76) IRM 25.23.10.12.2.8.1.1, Processing Expired O2/O3 Inventory - Contains guidance previously found in IRM 25.23.5.9.1.1

(77) IRM 25.23.10.12.2.8.1.2, Processing Expired O4-O7 & O9 Inventory - Contains guidance previously found in IRM 25.23.5.9.1.2

(78) IRM 25.23.10.12.2.9, Processing Identity Theft/Return Preparer Misconduct (RPM) Collection Alert Forms (Form 14394) - Notification of Balance Due IDT Case - Contains guidance previously found in IRM 25.23.5.10

(79) IRM 25.23.10.12.2.9.1, Processing Identity Theft/RPM Collection Alert Forms (Form 14394) – Actions Taken Balance Due Still Identified - Contains guidance previously found in IRM 25.23.5.10.1

(80) IRM 25.23.10.12.2.10, Back-End Process on Referrals Returned From Designated Identity Theft Adjustment (DITA) - Contains guidance previously found in IRM 25.23.5.11

(81) IRM 25.23.10.12.3, IDTVA - C AUR Identity Theft Case Processing - Contains guidance previously found in IRM 25.23.7

(82) IRM 25.23.10.12.3.1, IDTVA -C AUR IDTVA Clerical Procedures - Contains guidance previously found in IRM 25.23.7.2

(83) IRM 25.23.10.12.3.2, Technical Procedures - Contains guidance previously found in IRM 25.23.7.3

(84) IRM 25.23.10.12.3.2.1, Technical - Initial Handling Procedures - Contains guidance previously found in IRM 25.23.7.3.1

(85) IRM 25.23.10.12.3.2.2, Document Requirements for Cases with AUR Involvement - Contains guidance previously found in IRM 25.23.7.3.2

(86) IRM 25.23.10.12.3.2.3, Income Related Identity Theft - Contains guidance previously found in IRM 25.23.7.3.3

(87) IRM 25.23.10.12.3.2.4, Refund Related Identity Theft - Contains guidance previously found in IRM 25.23.7.3.4

(88) IRM 25.23.10.12.3.3, Closing Procedures - Contains guidance previously found in IRM 25.23.7.4

(89) IRM 25.23.10.12.3.4, IDTVA - C AUR Functional Liaison Responsibilities - Contains guidance previously found in IRM 25.23.7.6

(90) IRM 25.23.10.12.4, IDTVA - C Exam Identity Theft Case Processing - Contains guidance previously found in IRM 25.23.8

(91) IRM 25.23.10.12.4.1, IDTVA - C Exam General Procedures - Contains guidance previously found in IRM 25.23.8.2

(92) IRM 25.23.10.12.4.2, Technical Procedures for All Cases - Contains guidance previously found in IRM 25.23.8.3

(93) IRM 25.23.10.12.4.2.1, Technical - Initial Handling Procedures - Contains guidance previously found in IRM 25.23.8.3.1

(94) IRM 25.23.10.12.4.3, Returning Cases to Exam - Contains guidance previously found in IRM 25.23.8.10

(95) IRM 25.23.10.12.4.4, Field Exam Reconsiderations - Contains guidance previously found in IRM 25.23.8.13

(96) IRM 25.23.10.12.4.4.1, Field Exam Reconsideration Evaluations - Contains guidance previously found in IRM 25.23.8.13.1

(97) IRM 25.23.10.12.4.4.2, Returning Cases to the Field Exam - Contains guidance previously found in IRM 25.23.8.13.2

(98) IRM 25.23.10.12.5, Post Function DITA Procedures - Guidance was formerly found in IRM 25.23.10.9. Clarified instructions for DITA’s input of a TC 971 AC 501.

(99) IRM 25.23.10.12.5 (7) Removed paragraph. Remaining paragraphs were renumbered.

(100) IRM 25.23.10.12.5.1, Processing TC 150 Returns to an IRSN - Guidance was formerly found in IRM 25.23.10.9.1.

(101) IRM 25.23.10.12.5.1.1, Moving Account with Expired ASED to IRSN - Guidance was formerly found in IRM 25.23.10.9.1.1

(102) IRM 25.23.10-1, Format for E-mails to Appeals - New guidance

(103) IRM 25.23.10-2, AUR Standardized Case Notes for IDTVA (AUR Open Cases Only)

Effect on Other Documents

This IRM incorporates Compliance Identity Theft Case Processing IRM Procedural Updates IPU 16U1763 (dated 12-19-2016), IPU 17U0458 (dated 03-08-2017), IPU 17U0624 (dated 04-04-2017), IPU 17U0668 issued 04-12-2017, and IPU 17U0955 (dated 06-05-2017). IRM 25.23.10 dated 10-01-2016 is superseded

Audience

The provisions in this manual apply to all employees working Identity Theft Victim Assistance-Compliance Programs.

Effective Date

(10-01-2017)

Kevin Morehead
Director of Accounts Management
Wage and Investment Division

Program Scope and Objectives

  1. Purpose: This manual provides case procedures specific to identity theft cases with Compliance involvement. This manual also provides guidance for cases processed by the Designated Identity Theft Adjustment (DITA) Team.

  2. Audience: This IRM is for use by employees of the Identity Theft Victim Assistance (IDTVA) Specialty Teams.

  3. Policy Owner: Director of Accounts management.

  4. Program Owner: Accounts Management Identity Theft Victim Assistance.

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

  6. Program Goals: The Identity Theft Victim Assistance program goals and objectives are to be achieved by following the processes and procedures provided within this IRM for the IDTVA Specialty Teams. In addition to the IRM 25.23, the following IRMs may be utilized for processing work performed by IDTVA Specialty teams. This list is not all inclusive:

    • IRM 1.2.10.37 , Policy Statement 1-236

    • IRM 2.3, IDRS Terminal Responses

    • IRM 2.4, IDRS Terminal Input

    • IRM 3.12.3, Individual Income Tax Returns

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

    • IRM 3.17.277.1.1, Taxpayer Bill of Rights (TBOR)

    • IRM 4.13, Audit Reconsideration

    • IRM 4.19.2, IMF Automated Underreporter (AUR) Control

    • IRM 4.19.3, IMF Automated Underreporter Program

    • IRM 4.19.7 , IMF Automated Underreporter (AUR) Technical System Procedures

    • IRM 4.19.11, Examination Classification of Work

    • IRM 4.19.13, General Case Development and Resolution

    • IRM 4.19.14, EITC/Revenue Protection Strategy

    • IRM 4.19.15, Discretionary Programs

    • IRM 4.19.16, Claims

    • IRM 4.19.17, Non-Filer Program

    • IRM 4.31, Pass-through Entity Handbook

    • IRM 5.11, Notice of Levy

    • IRM 5.18.1, Automated Substitute for Return (ASFR) Program

    • IRM 5.19.1, Balance Due

    • IRM 5.19.2, Individual Master File (IMF) Return Delinquency

    • IRM 5.19.4, Enforcement Action

    • IRM 5.19.9, Automated Levy Program

    • IRM 8.2, Pre 90 Day and 90 Day Cases

    • IRM 10.5, Privacy and Information Protection

    • IRM 11.3, Disclosure of Official Information

    • IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria

    • IRM 20.1, Penalty Handbook

    • IRM 20.2, Interest

    • IRM 21, Customer Account Services

    • IRM 25.1, Fraud Handbook

    • IRM 25.12.1, Processing Refund Hold Program Inventory

    • IRM 25.6, Statute of Limitations

    • IRM 25.23, Identity Protection and Victim Assistance

    • IRM 25.24, Return Preparer Misconduct Program

    • IRM 25.25, Revenue Protection

Background

  1. In Fiscal Year (FY) 2015 the IRS opted to consolidate Identity Theft operations to improve accountability, efficiency, and timeliness. The Identity Theft Victims Assistance (IDTVA) organizational structure will provide unified leadership and improve program oversight.

Authority

  1. Refer to IRM 1.2.21 , Servicewide Policies and Authorities, Policy Statements for Customer Account Services Activities, for information.

Responsibilities

  1. The Wage and Investment Commissioner has overall responsibility for the policy related to this IRM which is published on a yearly basis. Additional information is found in IRM 1.1.13.9.4, Accounts Management and IRM 21.1.1, Accounts Management and Compliance Services Overview.

  2. Accounts Management Identity Theft Victim Assistance Specialty Teams are responsible for the activity(s) provided in this IRM. The provisions in this IRM are specific to resolving identity theft account referrals from:

    1. Automated Collection System Support (ACSS)

    2. Automated Substitute for Returns (ASFR)

    3. Automated Underreporter (AUR)

    4. Compliance Services Collection Operation (CSCO)

    5. Monitoring Offer in Compromise (MOIC)

    6. Centralized Offer in Compromise (COIC)

    7. Doubt as to Liability (DATL)

    8. Correspondence Examination (Exam)

    9. Field Exam Reconsiderations

    10. Field & Specialty Collection

    11. Large Business & International (LB&I)

    12. Tax Equity & Fiscal Responsibility Act (TEFRA)

  3. For a list of the IDTVA Speciality teams see IRM 25.23.4-7, IDTVA Site Locations.

Acronyms

  1. For a comprehensive listing of any IRS acronyms, please refer to the Acronym Database. The following acronyms will be used throughout this IRM:

    • Accounts Management (AM)

    • Accounts Management System (AMS)

    • Action Code (AC)

    • Assessment Statute Expiration Date (ASED)

    • Automated Substitute for Return (ASFR)

    • Automated Collection System Support (ACSS)

    • Automated Correspondence Exam (ACE)

    • Automated Underreporter (AUR)

    • Complete Case Analysis (CCA)

    • Command Code (CC)

    • Common Number (CN)

    • Compliance Service Collection Operation (CSCO)

    • Correspondence Examination Automation Support (CEAS)

    • Correspondence Imaging System (CIS)

    • Credit Reference Number (CRN)

    • Designated Identity Theft Adjustment (DITA)

    • Error Resolution System (ERS)

    • Identity Protection Specialized Unit (IPSU)

    • Identity Theft (IDT)

    • Identity Theft Assistance Request (ITAR)

    • Identity Theft Victim Assistance (IDTVA)

    • Identity Theft Victim Assistance Accounts Management (IDTVA - A)

    • Identity Theft Victim Assistance Compliance (IDTVA - C)

    • Identity Theft Victim Assistance IPSU (IDTVA - I)

    • Image Control Team (ICT)

    • Information Return (IR)

    • Installment Agreement (IA)

    • Integrated Automated Tools (IAT)

    • Integrated Data Retrieval System (IDRS)

    • Internal Revenue Service (IRS)

    • Internal Revenue Service Number (IRSN)

    • Offer in Compromise (OIC)

    • Operations Assistance Request (OAR)

    • Organization Function Program (OFP)

    • Oscar Inventory (OSINV)

    • Process Code (PC)

    • Query Management Facility (QMF)

    • Report Generation Software (RGS)

    • Return Transaction File (RTF)

    • Return Integrity and Compliance Services (RICS)

    • Return Preparer Misconduct (RPM)

    • Social Security Administration (SSA)

    • Social Security Number (SSN)

    • Statutory Notice of Deficiency (SNOD)

    • Submission Processing (SP)

    • Substitute for Return (SFR)

    • Taxpayer Advocate Service (TAS)

    • Taxpayer Identification Number (TIN)

    • Tax Equity and Fiscal Responsibility Act (TEFRA)

    • Transaction Code (TC)

    • Treasury Check Information System (TCIS)

Related Resources and Tools

  1. Refer to IRM 1.4.2.15, Related Resources, for information on related resources that impact internal controls. The following resources contain information and job aides that can assist in case processing.

    • Document 6209, IRS Processing Codes and Information

    • Accounts Management Research Portal – Identity Theft

    • SERP

  2. The following systemic tools may be utilized to perform research or to process the work performed by IDTVA. This list is not all inclusive:

    • Account Management Services (AMS)

    • Accurint

    • ACSweb

    • Automated Substitute for Return (ASFR) System

    • Automated Underreporter (AUR) System

    • Integrated Automation Technologies (IAT)

    • Integrated Data Retrieval System (IDRS)

    • Correspondence Examination Automation Support (CEAS)

    • Correspondence Imaging System (CIS)

    • Employee User Portal (EUP)

    • Individual Taxpayer Identification Number – Real Time System (ITIN-RTS)

    • Modernized E-File System (MeFile)

    • Remittance Transaction Research (RTR)

    • Report Generation Software (RGS)

    • Treasury Check Information System (TCIS)

Case Batching

  1. All cases that come into an IDTVA Specialty team must be controlled on CIS. All correspondence should be researched on IDRS and CIS to determine whether there are existing open CIS cases.

  2. Any new correspondence received on an open CIS case, a CIS Association sheet must be completed and sent to ICT to be associated with the existing open case.

    Note:

    DO NOT request the scan of like documents with no new information that are already on CIS.

  3. Any correspondence received on cases that have not been open on CIS will be sent to ICT to be imaged using the Image Control Team (ICT) Batch Cover Sheet.

  4. Any cases that were previously closed and re-opened, the case data fields must be updated with the correct case type, category code and OFP immediately after re-opening the cases. Cases re-opened should be worked and closed in the same day.

    Note:

    Prior to sending an IDT case to ICT for batching, all collection activities must be addressed, and an acknowledgement letter must be sent. See IRM 25.23.4.7.6, Collection Activity - Form 14394/13794 and IRM 25.23.10.3, Letter Procedures for more information.

    Exception:

    If a case already exists and is assigned to an examiner, do not issue an acknowledgement letter.

    Reminder:

    Before sending correspondence to ICT, perform research to ensure that the case meets the requirements to be worked in IDTVA and the account was marked with the appropriate IDT indicator.

  5. IDTVA teams receiving correspondence should complete the ICT Batch Cover Sheet for each piece of correspondence. This form and its instructions can be found on the Identity Theft Hub.

  6. All control bases will contain category code IDI* on all IDTVA cases to indicate the function the case is assigned to. When submitting an ICT Batch Cover Sheet to the ICT team, the correct IDI code must be indicated to ensure proper control. See IRM 25.23.2-16, IDRS Category Controls by Function and IRM 25.23.4.6.2 , Required Actions on All Identified IDT Cases.

    Note:

    If the correspondence contains a Form 14157, see IRM 25.24.1.5.1, Routing Information - Paper. Use the routing information to prepare the ICT Batch Cover Sheet to ensure it is assigned to the correct function. Do not issue an acknowledgement prior to referring to ICT. All acknowledgement and interim letters will be generated systemically through CIS. Do not route Form 14039 when the taxpayer is claiming RPM, send a 4674C letter to request the required RPM documentation. See IRM 25.24.2.2.2 , Case Batching for IDTVA - C Only for additional information.

  7. Input priority codes on the ICT Batch Cover Sheet as appropriate following IRM 25.23.4.7.9, Priority Codes for IDTVA-C Cases.

  8. If a Form 14394, Identity Theft Collection Alert or Form 13794, Request for Release or Partial Release of Notice of Federal Tax Lien will be sent to ACSS or Collection Advisory, include a copy of the completed form with the documents being sent to ICT for imaging.

    Exception:

    ACSS does not complete Form 14394, therefore they are not responsible for submitting a copy of the form to ICT

  9. Make sure that the ICT Batch Cover Sheet contains all necessary information so the case can be accurately controlled.

  10. Additional information about controlling case can be found in IRM 25.23.4.5.1.1, CIS Case Controls.

  11. Refer to the following specialty function sections, for additional batching requirements:

    • IRM 25.23.10.12.1.1, IDTVA-C CSCO Initial Receipt Clerical Actions

    • IRM 25.23.10.12.2.1.1, IDTVA-C ACSS Initial Receipt Clerical Actions

    • IRM 25.23.10.12.3.1, IDTVA - C AUR IDTVA Clerical Procedures

    • IRM 25.23.10.12.4.2.1, Technical - Initial Handling Procedures

Additional CIS Case Controls

  1. There must be an IDRS control and CIS record opened on each module impacted by identity theft on Form 14039. Additional IDRS control bases can be established by IDTVA by creating a case on CIS. Additional years identified through research that require an adjustment will be controlled on IDRS and have a CIS record created and linked. The additional years identified through CCA will mirror the document type and category of the original claim years. See the Creating a CIS Case Job Aid on the Identity Theft Hub for instructions on creating additional modules on CIS.

    Reminder:

    When another year is identified as part of CCA, the current date should be used as the IRS received date for those years.

Letter Procedures

  1. All functional outgoing correspondence guidelines apply. The following is a list of items that are required on all outgoing correspondence. This list is not all inclusive:

    1. Address all taxpayer questions or issues.

    2. Explain any actions taken on the taxpayer’s account.

    3. Provide an explanation why the IDT claim was not allowed, if applicable.

    4. Remaining balance dues and/or payments received.

  2. All IDTVA Specialty teams will use the following letters when addressing IDT issues, this list is not all inclusive:

    • Letter 5064C, ID Theft In-Process Letter, to acknowledge receipt of the IDT claim, or to request additional information.

    • Letter 4674C, Identity Theft Post - Adjustment Victim Notification Letter, as a closing letter when a CP 01, Identity Theft Acknowledgement, will not be systemically issued.

    Note:

    If Spanish language correspondence is received or the taxpayer marks the "Spanish" box in Section C of the Form 14039, a reply must be issued using the Spanish version of the appropriate C letter, if one is available.

    Exception:

    Do not issue the Spanish version of the C letter, if the taxpayer specifically requests to receive the letter in English.

  3. A determination of whether the case will remain in the function should be made prior to issuing any letters.

  4. Unless an exception in (5) below applies, all cases are required to have a Letter 5064C, ID Theft In-Process Letter, issued as an acknowledgement letter within 30 days of receipt into the function. If the case needs to be referred to another function, the referring function should issue the Letter 5064C as the acknowledgement letter prior to referral. The acknowledgement letter must include the toll-free number 1-800-908-4490.

    Example:

    IDTVA ACS-Support receives a referral from ACS-Support. Through research IDTVA-ACS-Support determines that the account has two impacted tax years. TY 2012 is an impacted tax year for ACSS and the TY 2013 has an Exam assessment. Per IRM 25.23.4-6IDTVA Routing Matrix, the case will be worked by IDTVA-Exam. IDTVA ACS-Support will send the acknowledgement letter to the taxpayer before preparing the case to be imaged by ICT. IDTVA ACS-Support will input on the ICT Batch Cover Sheet an IDI1, so that the case will get assigned to IDTVA-Exam.

    Note:

    Since the acknowledgement letter cannot be captured on CIS, include a copy of the letter with the correspondence being sent to ICT.

  5. Do not issue Letter 5064C as an acknowledgement letter, if any of the following conditions exist:

    • If it is determined that the case needs to be returned to the referring operation.

    • If another IDTVA function has already issued an acknowledgement letter within the last 180 days.

      Note:

      IPSU uses the Letter 5073C Letter as an acknowledgement letter.

    • If the case can be closed within 30 days of receipt, a separate acknowledgement letter is not required. In this situation a single Letter 4674C can be sent as the acknowledgement and closure letter. Issue the letter with the 1-855-343-0057 toll-free number and include the name and six digit extension of the employee assigned to the case.

    • If the correspondence has a Form 14157, or Form 14157-A, attached. See IRM 25.23.10.2 (6), Case Batching for additional information.

    • A CP 01S or CP 701S was previously issued to acknowledge the claim.

  6. If a case cannot be completed within the number of days specified in the acknowledgement letter, then an additional Letter 5064C, ID Theft In-Process Letter, must be sent as an interim letter. The letter must include the approximate number of days it will take to resolve the taxpayer’s account.

    Note:

    The time frame given in this interim letter may not exceed 60 days.

  7. When issuing a Letter 5064C, ID Theft In-Process Letter, to request additional information/documents, the letter must include the following information.

    • The number for the ID Theft toll-free line, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and

    • The name and six digit extension of the employee assigned to the case.

  8. Taxpayers must be notified when all account actions have been completed on a case. Accounts marked with an identity theft indicator TC 971 AC 501 will generate a CP 01, Identity Theft Acknowledgement. Refer to IRM 25.23.2.18.1.1, Systemic Actions Taken After TC 971 AC 501 Placed on Account, for additional information about a TC 971 AC 501 and the CP 01.

    Exception:

    CP 01 generates only once in a three year period. If another year was marked with a TC 971 AC 501 within the last 3 years, then a Letter 4674C is required to inform the taxpayer their account was corrected.

    Reminder:

    At least one letter must be sent during the processing of the case, providing the taxpayer with one of the two toll-free numbers. If the Interim Letter or Closure Letter will be the first contact, include the information listed in (7) above.

  9. When issuing a letter, ensure the correct paragraphs are used to inform the taxpayer of all actions taken on their account based upon the facts and circumstances of the case.

    • If appropriate, include multiple tax years by manually inputting the tax years in the empty boxes. Up to ten (10) tax years can be input in a Letter 4674C and eight (8) tax years can be input in a Letter 5064C.

    • If there is a valid Power of Attorney (POA) or third party representative on file, verify the Centralized Authorization File (CAF) copy selection is input.

  10. Actions taken on the account will determine if a Letter 4674C needs to be issued as a closure letter. The letter must provide the taxpayer with the telephone number and contact information listed in (7) above. A Letter 4674C must be sent if any of the following conditions exist:

    1. If the CP 01 will not be issued.

    2. If a Letter 5064C had not previously been issued providing the taxpayer with the ID Theft Toll Free number.

    3. It has been over 180 days since the last notice had been issued by IDTVA.

    4. There is still a compliance issue after the IDT issue is resolved.

    5. Additional clarification or information is necessary based upon the taxpayer’s questions or the complexity of the case.

    6. The resolution was not as the taxpayer anticipated.

    7. There is an additional requirement in the corresponding functional IRM.

  11. Closing an account with a TC 971 AC 506 in most instances, will not generate a systemic closing letter. Use Letter 4674C, Identity Theft Post - Adjustment Victim Notification Letter, to inform the taxpayer of the outcome of their IDT claim

  12. Do not issue Letter 4674C as an acknowledgement letter, if any of the following conditions exist:

    • Letter 4674C is not issued to Operation Mass Mailing (OMM) taxpayers. OMM is a common identity theft scheme. The characteristics are defined in IRM 25.25.2.13, Identity Theft Scheme Criteria. For additional information, on OMM accounts see IRM 25.23.2.21.2.1, Operation Mass Mailing (OMM) Cases - Processing Good Returns.

    • When there is an existing TC 971 AC 505 (for a 2015 incident). See IRM 25.23.2.22.2, Get Transcript Incident - Tax Related Case Resolution for more information

    • When there is an existing TC 971 AC 505 (for a 2016 incident). See IRM 25.23.2.23.2.2, All Employees Resolving Tax-Related Issues - When addressing accounts with TC 971 AC 505 IR20160127510, IR20160127513 and IR20160614508 ONLY for more information.

  13. Be sure any necessary letters are being sent to the correct address. The Correspondex letter system will default to the address of record (CC ENMOD) which may or may not be the correct address. Override the address of record when appropriate.

  14. It is mandated that the IAT Letters tool in the IAT Task Manager is used to input the Letter 5064C or Letter 4674C. The tool provides a simple format for selecting the required paragraphs, manually editing the address to the valid SSN owner’s information and adding a history item or updating the control base on IDRS. See IRM 21.2.2-2, ACCOUNTS MANAGEMENT MANDATED IAT TOOLS, for more information.

Guidelines for a Quality Response

  1. Policy Statement P-21-3 guidelines require timely and quality responses to taxpayer correspondence.

  2. A quality response is an accurate and professional communication which, based on information provided, resolves the taxpayer issues, requests additional information from the taxpayer, or notifies the taxpayer we have requested information from outside the IRS.

  3. Review letters as necessary for misspelled words, errors in capitalization and punctuation, IRS jargon and other fill-in errors.

    Reminder:

    Fill-in errors may include missing alpha designations on forms, such as Form 1040 "A" or Form 1040 "EZ".

  4. When issuing a Letter 5064C or Letter 4674C, for the correspondence date, use the signature date or the date written on the correspondence from the taxpayer. If date cannot be determined, use the dates listed below in the following order:

    • Fax Received Date

    • Postmark Date

    • Three days prior to the IRS received date of the case.

  5. The functional specialized teams are responsible for acknowledging the identity theft claim and subsequent follow-ups until the account resolution is complete.

  6. All interim letters should inform the taxpayer when a final response can be expected and provide a contact name and number for additional inquiries.

    Reminder:

    An interim letter may not exceed 60 days.

Corresponding with the Taxpayer

  1. When the taxpayer does not provide complete documentation or the information provided is insufficient, and a determination cannot be made through internal research, attempt to contact the taxpayer by telephone no less than two times. Document each attempt in a CIS Case Note.

    Note:

    There must be a reasonable amount of time between the two attempts. The second attempt should not be made immediately after a first unsuccessful attempt.

    Caution:

    When making or receiving phone calls, IRM 21.1.3.2.3, Required Taxpayer Authentication, must be followed to ensure the examiner is speaking to the appropriate taxpayer and to prevent unauthorized disclosure of tax information.

  2. If contact is made with the taxpayer via telephone and there are required documents that they must submit, provide them with a fax/EE-Fax number so they can submit the needed documentation. Allow the taxpayer five (5) business days to submit the documents. If the document(s) are not received within the five (5) days, send a Letter 5064C requesting the document(s). See (3) below, for additional information regarding sending a letter.

    Note:

    Be sure to explain to the taxpayer that if the requested information is not received within the allotted time, the compliance issue or collection action will resume, as applicable.

  3. If no contact information is available or if the telephone attempts are unsuccessful, correspond with the taxpayer via 5064C letter to request the needed information or additional documentation and take the following actions:

    Note:

    Ensure the correct address is used when issuing any correspondence to the taxpayer.

    • Use IAT to input Letter 5064C

      Note:

      Inform the taxpayer they have 30 days (60 days for International) from the date of the letter to respond.

    • Capture an image of the letter on CIS.

    • See IRM 25.23.4-12, IDRS Activity Codes and Definitions for documenting the follow-up date. Follow-up date will be 40 days from the posted date of the letter.

    • Suspend the case for 40 days (70 days for international cases). Refer to IRM 25.23.10.3, Letter Procedures for additional letter requirements.

    • If the follow-up date expires, review CIS for documentation. If no documentation is present, input a TC 972 AC 522 (NORPLY) and send a Letter 4674C notifying the taxpayer of the closure. See IRM 25.23.2.16.4.1, Invalid Identity Theft Determinations – TC 972 AC 522 NORPLY .

Types of Identity Theft

  1. This section describes and provides guidance for the two (2) types of IDT.

    • Income or Employment Related

    • Refund Related

Income or Employment Related IDT

  1. Income or employment related identity theft occurs when the identity thief uses the victim’s TIN to obtain employment, resulting in what may appear as unreported income under the victim’s account.

  2. This type of IDT can be seen when working substitute for return (ASFR or SFR) cases or AUR cases when working multiple years with AUR involvement.

  3. If the determination is resolved as an income issue only, i.e., another taxpayer worked under the victim’s valid TIN:

    1. Input TC 971 AC 501 or TC 971 AC 506 with Tax Administration source code "INCOME" .

    2. If needed, update the entity information for the correct address.

    3. Complete Form 9409, IRS/SSA Wages Worksheet, if any wage items are removed from the taxpayer’s report, unless the taxpayer has provided a Social Security Administration determination letter on the wage items in question.

    Note:

    If IRPTR information is not available, NoForm 9409 is required. Document CIS case notes using suggested language, "IRP information not available, no F9409 required."

Refund Related IDT

  1. Refund related IDT occurs when the identity thief uses the victim’s TIN to file a false federal income tax return to obtain a refund. If the thief files before the victim, the victim may not receive his or her refund within a reasonable time frame.

  2. There are several tools that can assist with determining whether the posted return is refund related IDT:

    • IRPTR/IDRS Data Decision Tree

    • Refund Scheme Listing

    • Schedule C Nullity Screening

    Note:

    See IRM 25.23.4.12.4, TIN Related Problems for IRP Data, Refund Scheme or Schedule C, Case Processing, for more information.

  3. When a return meets one of the criteria above the return is deemed a nullity.

  4. If the return posted to the account is deemed a nullity, the return will be reversed from the account without moving it to an IRSN account. Any refund lost is moved to the Accounting General Ledger (GL) 1545 using IDRS command code IDT48/58.

  5. Compare the TC 150 return and any unprocessed returns using the various tools to assist with the determination. Once the nullity screening has been completed, continue with the required IDT actions.

Referrals from Taxpayer Advocate Service

  1. IDT claims will continue to be referred from TAS when they meet TAS criteria 1-4. See IRM 25.23.2.5, Taxpayer Advocate Service for additional information.

  2. IDT Operations Assistance Requests (OARs) will be routed through the IDTVA TAS liaison and assigned per the established distribution to the team IDRS group and employee 20000 with category ATAO.

  3. The assigned examiner will create the case on CIS if not previously on CIS and route the TAS documents for scanning using the CIS Association sheet under the appropriate IDIX category code and CIS priority code "1" .

    Note:

    Exception scanner can also be used in place of the CIS Association sheet.

    Note:

    If dual controls are established for the same tax year, use IDIX and ATAO.

  4. TAS also has the discretion to assign and refer any criteria 5-7 cases, see IRM 25.23.2.14.1, Identity Theft Assistance Requests (ITAR) Referrals, for guidance on handling ITAR referrals.

Unprocessed/Secured Returns - General

  1. Unprocessed returns can be included as part of the IDT correspondence and must be handled appropriately. This process involves reviewing the return and routing to Submission Processing. This section provides general guidance for the handling of unprocessed returns.

  2. A return will be considered signed if the correspondence includes any form that contains a signed Jurat (i.e., Form 14039, Letter 3219C).

    Reminder:

    Both taxpayer’s signatures must be present on joint filed returns.

  3. If an unprocessed return is received follow the instructions in either IRM 25.23.10.7.1, Unprocessed/Secured Returns - Initial Screening, if the return was received as referral from another function or IRM 25.23.10.7.2, Unprocessed/Secured Returns - Technical Guidance, if the return is included with correspondence in response to a Letter 5064C.

  4. Returns not processed as an original return have bypassed DIF scoring. These legitimate taxpayers’ unprocessed returns, must be screened after they are processed. Refer to IRM 25.23.4.12.6(3) Adjustment Related Input Actions If/Then statement (5), Actions Required on Streamline and Non-Streamline Case Processing, for instructions regarding the DIF scoring process.

  5. If the unprocessed return meets the nullity criteria, that return is not processed. Annotate the CIS case notes to document the criteria and determination for nullification.

    Reminder:

    All returns must be included as a CIS image on the case.

  6. If there is no TC 150 posted to the account, any unprocessed returns filed by the valid taxpayer must be sent to SP to be processed.

Unprocessed/Secured Returns - Initial Screening

  1. When a return is included with the referred case, research to determine if it was previously scanned as a CIS image:

    1. Review the document for a CIS Case Number.

    2. Review return(s) for a stamped DLN. If a DLN is present, search CIS images for a return with the same DLN and follow the table below.

      If the return is Then
      1) Located in CIS images, The return does not need to be sent for imaging.
      2) Not located on CIS images and CC TXMOD shows a TC 976 with the same DLN, Send the case to ICT to be imaged.
      3) Not located on CIS images and CC TXMOD shows no matching TC 976 DLNs, Route the case to SP, following the instructions in (4).
    3. When a return does not have a stamped DLN, review CC TXMOD for a posted TC 977 or pending TC 971 AC 010. If present, verify the date of the transaction matches the stamped IRS received date on the return. When the dates match, search CIS images for an identical return.

      If Then
      1) An identical return is located, The return does not need to be sent for imaging.
      2) An identical return is not located, Send the case to ICT to be imaged.
    4. When the posted TC 977 or pending TC 971 AC 010 do not match the stamped IRS received date on the return, send the case to be imaged.

  2. When required to route a return to SP, photocopy the entire response, including the return. Retain a copy until it is imaged and the TC 976 is posted.

  3. Prior to routing to ICT, ensure the following items are included in the package and are assembled in the following order:

    1. Routing Slip

    2. CIS Batch Sheet

    3. Return, including all related schedules and forms

    4. Additional correspondence submitted with the return

    5. Copy of the Letter 5064C, if applicable

  4. For campuses with a SP site, route the return to SP using a Form 1725, or similar local routing slip. For campuses without a SP site, route the return to SP using a Form 3210. See IRM 21.1.7-2, Submission Processing Stop Numbers for Routing Non-Remit Documents, for the service center addresses and IRM 21.3.3.3.5, Submission Processing Consolidation (Rampdown) to determine which SP site to route the documents. Include on the form "post TC 976" or similar instruction in the Remarks field.

    Exception:

    Unprocessed Forms 1040-NR, 1040-SS and 1040-PR will be sent to Austin Service Center.

  5. Prior to sending the return to SP, research IDRS CC TXMOD for an unreversed TC 971 AC 121 or AC 124. If a TC 971 AC 121 or AC is present, reverse it by inputting a TC 972 AC 121 or AC 124.

  6. To prevent the good return from unposting, edit the return with "SPC B" and notate "ITVA" , (in the right margin between the secondary TIN and Presidential Election Campaign Fund designation) per the instructions in IRM 3.12.2-4, Special Processing Code (SPC). This will allow the return to bypass all the UPC 147 reason codes except RC 4. Also refer to IRM 21.5.2.4.23.7, Coding and Editing Procedures, for additional guidance that may be applicable when sending a return for processing. All edits must be made in "Red" pen/pencil only.

  7. If there is a name line change, update ENMOD prior to sending the return to SP for processing (e.g., single to joint).This will allow the return to bypass the UPC 166. See IRM 3.12.179.61, UPC 166 Filing Status Code (FSC) Mismatch.

  8. If IDRS CC TXMOD reflects a Masterfile status of "02" or "03" notate the appropriate TC 59X code in the left margin of the return. See IRM 25.23.2.18.5(3), Closing Identity Theft Cases with Tax Delinquency Inquires (TDI), for additional information.

Unprocessed/Secured Returns - Technical Guidance

  1. If a return is included with the referred case and IDRS CC TXMOD reflects a Masterfile status of "02" or "03" , see IRM 25.23.2.18.5, Closing Identity Theft Cases with Tax Delinquency Inquiries (TDI) for additional instructions.

  2. Once a determination of CN ownership has been made, follow these instructions in conjunction with the corresponding functional IRM when an unprocessed return is received.

    If And Then
    1) There is a TC 976 or TC 977 present on the account Determine the TC 976/977 is the return in the case
    • If the return contains the appropriate signature(s), resolve the account based on the determination following the instructions in IRM 25.25.4, Integrity & Verification Identity Theft Return Procedures.

    • If the return is incomplete (does not contain the appropriate schedules/documentation and/or signature(s)), follow the instructions in IRM 25.23.10.7.2.1, Incomplete Returns

    2) There is a TC 976 or TC 977 present on the account Determine the TC 976/977 is not the return in the case and the return contains the appropriate signature(s)
    • Search CIS for related cases, and link the cases.

    • Print and forward the return to SP to have the TC 976 posted. Follow (4) below.

    • Suspend the case for 40 days.

    • If the TC 976 posts, resolve the account based on the determination following the instructions in IRM 25.25.4, Integrity & Verification Identity Theft Return Procedures

    • If the 40 days expires and no TC 976 has posted, see IRM 25.23.10.7.2.2, Expiration of the Suspense Time Frame - Signed Returns

    3) There is a TC 976 or TC 977 present on the account Determine the TC 976/977 is not the return in the case and the return is incomplete (does not contain the appropriate schedules/documentation and/or signature(s))
    • Search CIS for related cases, and link the cases.

    • Follow the instructions in IRM 25.23.10.7.2.1, Incomplete Returns

    4) There is no TC 976 or TC 977 present on the account The return is present on CIS and the return contains the appropriate signature(s)
    • Print the return and forward to SP to have the TC 976 posted. Follow (4) below. Instruct SP on the routing form not to image the return.

    • Suspend the case for 40 days.

    • Once the TC 976 posts, resolve the account based on the determination following the instructions in IRM 25.25.4, Integrity & Verification Identity Theft Return Procedures

    • If the 40 days expires and no TC 976 has posted, see IRM 25.23.10.7.2.2, Expiration of the Suspense Time Frame - Signed Returns

    5) There is no TC 976 or TC 977 present on the account The return is present on CIS and the return is incomplete (does not contain the appropriate schedules/documentation and/or signature(s)) Follow the instructions in IRM 25.23.10.7.2.1, Incomplete Returns
    6) A paper return is received in response to a Letter 5064C The return contains the appropriate signature(s) Forward the return to SP to have the TC 976 posted and imaged. Follow (4) below. Prior to routing, photocopy the return and retain a copy. Ensure the following items are included in the package and are assembled in the following order:
    1. Routing Slip

    2. CIS Association Sheet

    3. Return, including all related schedules and forms.

    • Suspend the case for 40 days.

    • Once the TC 976 posts, resolve the account based on the determination following the instructions in IRM 25.25.4, Integrity & Verification Identity Theft Return Procedures

    • If the 40 days expires and no TC 976 has posted, see IRM 25.23.10.7.2.2, Expiration of the Suspense Time Frame - Signed Returns

    7) A paper return is received in response to a 5064C letter The return is incomplete (does not contain the appropriate schedules/documentation and/or signature(s)) Follow the instructions in IRM 25.23.10.7.2.1, Incomplete Returns

    Note:

    Prior to sending the return to SP, research IDRS CC TXMOD for an unreversed TC 971 AC 121 or AC 124. If a TC 971 AC 121 or AC 124 is present, reverse it by inputting a TC 972 AC 121 or AC 124.

    Note:

    Functions that address income that has not been reported are also required to verify all income belonging to the taxpayer(s) is included on the return to be processed. Refer to the corresponding functional IRMs for instructions on how to handle incomplete returns.

    Note:

    To prevent the good return from unposting, edit the return with "SPC B" and notate "ITVA" , (in the right margin between the secondary TIN and Presidential Election Campaign Fund designation) per the instructions in IRM 3.12.2-4, Special Processing Code (SPC). This will allow the return to bypass all the UPC 147 reason codes except RC 4. Also refer to IRM 21.5.2.4.23.7, Coding and Editing Procedures, for additional guidance that may be applicable when sending a return for processing. All edits must be made in "Red" pen/pencil only.

    Reminder:

    If it is determined that an IRSN is required to resolve the account, see the instructions in IRM 25.23.10.11, Post Function Referral Procedures to refer the case to DITA, once the TC976/977 posts.

  3. If IDRS CC TXMOD reflects a Masterfile status of "02" or "03" notate the appropriate TC 59X code in the left margin of the return. See IRM 25.23.2.18.5(3), Closing Identity Theft Cases with Tax Delinquency Inquires (TDI), for additional information.

  4. For campuses with a SP site, route the return to SP using a Form 1725, or similar local routing slip. For campuses without a SP site, route the return to SP using a Form 3210. See IRM 21.1.7-2, Submission Processing Stop Numbers for Routing Non-Remit Documents, for the service center addresses and IRM 21.3.3.3.5, Submission Processing Consolidation (Rampdown) to determine which SP site to route the documents. Include on the form "post TC 976 and do not send to ICT to be imaged" or similar instruction in the Remarks field.

    Exception:

    If a paper return is received in response to a 5064C letter, only input "post TC 976" as the remarks.

    Exception:

    Unprocessed Forms 1040-NR, 1040-SS and 1040-PR will be sent to Austin Service Center.

  5. If the ASED is incorrect due to the filing of an IDT Return, the ASED should be updated and posted based upon the taxpayer’s valid return received date prior to sending the return to SP for processing.

    Example:

    A taxpayer claims IDT for TY 2014. The TC 150 return which set the ASED to 04152018, is deemed to be a IDT return. The taxpayer’s valid return was received on 10252015. The ASED should be updated to 10252018.

  6. If there is a name line change, update ENMOD prior to sending the return to SP for processing (e.g., single to joint).This will allow the return to bypass the UPC 166. See IRM 3.12.179.61, UPC 166 Filing Status Code (FSC) Mismatch.

Incomplete Returns
  1. When the taxpayer has submitted an incomplete unprocessed tax return to IDTVA, take the following actions:

    • Send a Letter 5064C requesting the missing schedules/documentation.

      Note:

      If the return is missing the necessary taxpayer signature(s), include paragraph U.

    • Suspend the case for 40 days.

  2. Use the table below to determine what action to take, if the taxpayer responds or the 40 day suspense time frame expires.

    Caution:

    The instructions in this table are only for the handling of a taxpayer’s return as submitted. Refer to the functional portions of this IRM to determine if the submitted return resolves the outstanding compliance issues.

    If And Then
    1) The taxpayer provides the missing information Forward the return to SP to have the TC 976 posted and imaged. Follow IRM 25.23.10.7.2(4), Unprocessed/Secured Returns - Technical Guidance. Prior to routing, photocopy the return and retain a copy. Ensure the following items are included in the package and are assembled in the following order:
    1. Routing Slip

    2. CIS Association Sheet

    3. Return, including all related schedules and forms.

    • Suspend the case for 40 days.

    • Once the TC 976 posts, resolve the account based on the determination following the instructions in IRM 25.25.4, Integrity & Verification Identity Theft Return Procedures

    2) The taxpayer does not provide the appropriate missing information and/or the 40 day suspense time frame has expired The submitted incomplete return contains a tax increase or credit decrease Follow the instructions in IRM 21.5.3.4.1, Tax Increase or Credit Decrease Processing
    3) The taxpayer does not provide the appropriate information and/or the 40 day suspense time frame has expired The submitted incomplete return contains a tax increase or credit increase Follow the instructions in IRM 21.5.3.4.1.1, Tax Increase and Credit Increase Processing.
    4) The taxpayer does not provide the appropriate information and/or the 40 day suspense time frame has expired There is a tax decrease or credit increase
    • Compute the adjustment for the income and input any applicable tax increase. Do not allow the deductions/credits shown on the return. Follow math error procedures as outlined in IRM 21.5.4.4, Math Error Procedures Research

      Note:

      See IRM 21.5.3.4.3, Tax Decrease and Statute Consideration, for tax decreases or credit increases on statute year claims.

    • Correspond with the taxpayer explaining the difference in the adjustment.

    Note:

    See IRM 21.5.3.4.2(5), Tax Decrease or Credit Increase Processing, for instructions regarding accepting a faxed signature.

Expiration of the Suspense Time Frame - Signed Returns
  1. If an unprocessed return is sent to SP and the TC 976 has not posted after the forty (40) day suspense time frame has expired, use the following table to determine how to continue processing the case.

    Caution:

    The instructions in this table are only for the handling of a taxpayer’s return as submitted. Refer to the functional portions of this IRM to determine if the submitted return resolves any outstanding compliance issues.

    If Then
    1) TXMOD reflects a rejected (RJ) TC 150 with an ERS status code. ERS has corresponded with the taxpayer to obtain required information/documentation. Monitor the account until the rejected TC 150 has converted into a TC 976.
    2) The ASED for the new valid return was not updated as required (see IRM 25.23.10.7.2(5), Unprocessed/Secured Returns - Technical Guidance for additional information)
    • Update the ASED to the correct date based on the earliest IRS Received Date. After the new ASED has posted to the account.

    • Resubmit the valid return to SP.

    3) Unpostable code 126-0 This is the unposting of a return that was identified as potential IDT by the Taxpayer Protection Program (TPP). Monitor the account until a TC 976 posts or until the return posts to MFT 32.
    4) The TC 976 unposted (other than UPC 126-0)
    • Suspend the case for an additional 40 days, to allow the Unpostables unit time to resolve the unpostable.

    • If the additional 40 day suspense time frame elapses and the TC 976 still has not posted, then take the necessary actions to correct the account.

    • Process the good return by inputting a TC 290/291 as appropriate.

    5) There is no indication that a TC 976 will be input (such as, a pending transaction, an unpostable, etc.)
    • Resend the return to SP and suspend the case for an additional 40 days. If the additional 40 day suspense time frame elapses and the TC 976 still has not posted, then take the necessary actions to correct the account.

    • Process the good return by inputting a TC 290/291 as appropriate.

Identity Theft Allegations on Tax Years 2006 and Prior

  1. Taxpayers may claim identity theft on tax years 2006 and prior in the following scenarios:

    1. First time filer and current year refund was offset to a prior year

    2. Taxpayer was a minor in the tax year(s) in question

    3. Current year refund was offset due to a prior year assessment

  2. Research the accounts to determine whether the taxpayer is a victim of IDT. Although IRPTR data may not be available, other information may be available to assist with the determination, such as RGS/CEAS RTF data or AUR data (CP2000). IRPTR data for more current years may assist as well.

    Example:

    The taxpayer claims he/she did not file a return for 2004; he/she was not required to file. In researching IRPTR for more current years, it is determined that multiple people are using the SSN for employment purposes. There are IRP documents for the taxpayer which confirms the taxpayer does not have a filing requirement. There is a high likelihood the same scenario applies for the tax year in question.

    Example:

    The taxpayer claims he/she was incarcerated. If no information can be obtained using CC FTBOL, request verification from the taxpayer.

    1. Research AMS for the CP2000 or RGS for the RTF data to determine the information filed on the return in question. Research CC IRPTR for available years to determine if the taxpayer had a filing requirement in other years.

    2. Review AMS, CEAS, or the AUR system for taxpayer interaction with the Service, (i.e., telephone history).

    3. Research the age of the taxpayer and prior filing history.

    4. Ask for additional information that would assist with the determination, if necessary.

    5. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Reminder:

    If additional information is needed to verify the IDT allegation, attempt to call the taxpayer if a contact number is available.

    Note:

    If IPRTR information is unavailable and the income in question is wages, there is no requirement to complete Form 9409, IRS/SSA Wages Worksheet.

  3. In cases where a taxpayer is alleging IDT and the CSED has expired; do not request the return be moved to an IRSN. These types of cases can be identified by reviewing the CSED expiration date and a TC 608 will be on the account. Accounting will not move these accounts because the CSED expired. There should be no impact to the taxpayer.

  4. In situations where there is an impact, (i.e., a current year refund was offset to a prior year), a TC 608 is on the account and the IDT allegation has been confirmed, move any offsets back to the appropriate year using a posting delay code of 1. This will systemically reverse the TC 608. The TC 608 will automatically reset once all of the credit transfers have posted.

  5. When Notices of Federal Lien (NFTL) are filed on accounts, the Service does not notify the credit bureaus. The credit bureaus research and place lien information on taxpayer credit reports.

  6. When a CSED expires, liens are automatically released. The Service is not required to report to the credit bureaus when liens are released. A Form 1099-C, Cancellation of Debt will not be issued to the taxpayer in this situation.

    Note:

    If the taxpayer requests the NFTL be withdrawn see IRM 25.23.10.12.2.3 (17), Processing Identity Theft Correspondence.

  7. In situations where a taxpayer is claiming IDT on a year where the CSED has expired, research the account to make the determination. If IDT is confirmed, do not adjust the account unless it meets one of the criteria above. Input a history item on ENMOD to reflect the IDT indicator as required per IRM 25.23.2.18.1, Closing Taxpayer Initiated Identity Theft Affecting Tax Administration – TC 971 AC 501. Document actions taken in a CIS case note.

  8. If the taxpayer’s correspondence indicates he/she is impacted due to a Notice of Federal Tax Lien (NFTL), see IRM 25.23.4.7.6.2, Collection Activity - Form 13794 Additional Actions Required - Lien, for additional information.

  9. If a determination is made that a return needs to be moved to an IRSN, follow IRM 25.23.10.11, Post Function Referral Procedures

Identity Theft Cases with Multiple Specialty Function Involvement

  1. When performing complete case analysis, if other years have AUR or ASFR involvement, it may be necessary to contact the appropriate IDTVA AUR or ASFR liaison when there is an open AUR or ASFR control. This action is necessary so the appropriate systems can be documented and properly closed out.

Identity Theft Cases with AUR Involvement

  1. When working accounts with Automated Underreporter (AUR) involvement, it is necessary to research the account to determine where the account is in the AUR process. This can be determined by reviewing the Underreporter Process Codes listed under the Transaction Code (TC) 922 on the account. The status of an Underreporter case will be determined by the last process code posted. The definitions of the Underreporter Process Codes can be found in Chapter 8, Section 19 of Document 6209, IRS Processing Codes and Information, and in IRM 4.19.3-4, AUR Process Codes

  2. Cases that are identified as still open in AUR will require an e-mail be sent to the IDTVA-AUR IDT liaison at the campus the AUR account is located. This can be determined by the TC 922 DLN. A listing of AUR IDT liaisons can be found on SERP at Identity Theft Liaison listing.

    Note:

    Ogden AUR cases are referred to the IDTVA –C AUR team located in Philadelphia. Contact the IDTVA-C Philadelphia AUR liaison to assist with any open Ogden AUR cases.

    Note:

    Process codes 30, 55, 57, 59, 75, 95, 97, 98 and 99 indicate the case is an open AUR case.

    Note:

    TXMOD control with open URP- or URPS.

  3. The e-mail must contain the determination of the IDT allegation and the disposition of the AUR issue.

    Example:

    A taxpayer receives a CP 2000 for underreported wages and interest income. The taxpayer alleges the W-2 income does not belong to him/her. It is determined that the taxpayer is a victim of IDT. The e-mail would contain information that it has been determined that the W-2 does not belong to the taxpayer and should be deleted. The interest income was not addressed by the taxpayer. Delete the IR for the W-2 income and continue processing the case.

    Example:

    A taxpayer received a CP 2000 for underreported social security benefits. The taxpayer alleges IDT and he/she does not have a filing requirement. After researching the IDT allegation, it is determined that the taxpayer is a victim of IDT. The e-mail would state the taxpayer does not have a filing requirement. The TC 150 is a nullity; close the AUR issue as a no change. IDT resolves all AUR issues.

  4. When working AUR reconsiderations, there is no need to contact the IDTVA AUR liaison.

Identity Theft Cases with ASFR Involvement

  1. When working accounts with Automated Substitute for Return (ASFR) involvement, it is necessary to research the account to determine whether the account is open in the ASFR process or a reconsideration. This can be determined by reviewing TXMOD. Open ASFR cases can be identified by:

    • A TC 150 .00 with a DLN containing a tax class and doc code of 210

    • "SFR" will be notated to the right of the TC 150 DLN

    • The ASFR DLN will have a Julian date of 887

    • A corresponding TC 140 and

    • A TC 971 AC 141 with no TC 290 assessment

  2. Cases that are identified as still open in ASFR will require an e-mail be sent to an IDTVA ASFR IDT liaison. Liaisons can be located on SERP, using the following link Identity Theft Liaison listing.

  3. The e-mail must contain the determination of the IDT allegation and the disposition of the ASFR issue.

    Example:

    A taxpayer submits an IDT affidavit claiming he/she is a victim of identity theft and did not earn income in the year identified on the Form 14039, Identity Theft Affidavit. Upon researching IDRS, it is determined that the case is open in the ASFR program. Review IRPTR to determine if the income in question belongs to the taxpayer. It is determined that the taxpayer is a victim of IDT and all income does not belong to the taxpayer. The e-mail would contain information that the ASFR income does not belong to the taxpayer and should be deleted and should contain verbiage such as "The ASFR case should be closed as the taxpayer is not liable, victim of IDT, no filing requirement" .

    Example:

    A taxpayer submits a Form 14039 claiming some of the income reported under his/her SSN was not earned by him/her. After researching the IDT allegation and IPRTR, it is determined that a portion of the income belongs to the taxpayer. The e-mail would state the taxpayer is a victim of IDT and IR ABC only belongs to the taxpayer, all other income is a result of IDT.

  4. An ASFR reconsideration will reflect the same information as an open ASFR but with a TC 290 assessment and a TC 599 with closing code 088 or 089. Closing code 088 indicates the case was closed as a no response or disagreed. Closing code 089 indicates a return was secured.

  5. When working ASFR reconsiderations, there is no need to contact the IDTVA ASFR liaison unless IRPTR information is unavailable and a clear determination cannot be made.

    Note:

    The ASFR Liaison will be able to provide all income items when IRPTR information is unavailable.

Refund Hold Program
  1. The Refund Hold Program was designed to hold individual income tax refunds and credit elects of ≡ ≡ ≡ ≡ ≡ ≡ , when a current or prior year refund return is filed and the taxpayer’s account has at least one unfiled tax return within the five years prior to the current year.

  2. There may be instances when the taxpayer claims IDT because his/her refund is being held for another year.

    Example:

    The valid taxpayer did not file for TY 2013 because they did not have a filing requirement. However, IRPTR shows enough wage income (that was earned by someone other than the valid taxpayer) to have a filing requirement and would result in a balance due. The valid taxpayer files a TY 2015 return expecting a refund. The refund is held because of the TDI issue created by the fraudulent income.

  3. Refunds held by this program can be identified on IDRS by:

    1. A TC 570 with "999" in the Julian Date of the DLN.

    2. Reason code “RF” displayed on the IDRS module of the refund year.

    3. Freeze Code “-R” on the IDRS module for the year of the refund being held.

  4. Refunds are released systemically under the following conditions:

    1. The designated hold period (6 months) expires. A TC 571 is used with "998" in the Julian Date.

    2. A TC 290 or TC 300 coupled with a TC 599 posted to the SFR/ASFR delinquency.

    3. A TC 571 is used with "999" in the Julian Date.

    4. A TC 590, TC 591 or TC 593 posts to the delinquent year.

    5. Freeze restriction is present (-C, -V, -W, -Z or Z-)

  5. Refund holds can be manually released inputting a TC 290 .00 with a priority code 08 and a reason code 085 to the refund hold module (tax year of refund being held) when one of the following criteria is met:

    1. Liability determination has been made on all delinquencies related to the taxpayer and there are no balance dues modules unless there are Compliance select codes present.

    2. All delinquent return(s) are submitted and there are no balance due conditions.

    3. The taxpayer is experiencing an economic hardship and supporting documentation has been provided by TAS on an OAR.

    4. The taxpayer is in a declared disaster area and has self-identified as an affected taxpayer.

    5. The taxpayer filed with a spouse and it has been verified there are no balance due conditions related to the taxpayer.

    6. The taxpayer is deceased.

    7. The taxpayer is in bankruptcy.

    8. The taxpayer is in a combat zone and there is no exit date present on IDRS CC IMFOLE.

      Note:

      Do not release the refund if there are any other hold codes on the module, such as IVO, or CI.

  6. See IRM 25.12, Delinquent Return Refund Hold Program, for additional information.

Identity Theft Cases with Tax Delinquency Inquiries (TDI) Involvement

  1. See IRM 25.23.2.18.5, Closing Identity Theft Cases with Tax Delinquency Inquiries (TDI), for guidance on resolving TDI related issues.

Requests for an Appeal

  1. Taxpayers have various appeal rights that can be requested on cases that were worked within Compliance. The different appeal rights are as follows:

    • Non-docketed cases – A taxpayer can request a conference with Appeals on an examination that is pre-Notice of Deficiency when the taxpayer disagrees with Exam’s determination.

    • Docketed cases – A taxpayer can petition the Tax Court based upon a Notice of Deficiency when a taxpayer disagrees with an ASFR, AUR, or Exam determination. The taxpayer is generally afforded an Appeals conference prior to the trial date before the Tax Court.

    • Collection Due Process (CDP) cases – A taxpayer can file a CDP appeal when there is unpaid tax and the taxpayer is disputing the enforced collection action (may be an ASFR, AUR, Exam assessment case).

    • Reconsideration Appeal – A Compliance assessment was made and the taxpayer submitted a request for reconsideration which was denied, except for Return Preparer Misconduct cases, see note under IRM 25.23.10.10.2(1), Taxpayer Requests a Reconsideration Appeal of an Invalid Identity Theft Determination. A taxpayer can request his/her case be reviewed by Appeals.

  2. When taxpayers file an appeal, the case is normally routed to Appeals for consideration. Appeals will review the cases based upon the facts and circumstances of the case. Appeals gives full, fair, and impartial consideration to the merits of each new issue a taxpayer raises once the originating function has had an opportunity to examine the issue.

  3. Cases with Appeals involvement may be identified as follows:

    1. A -L or -W freeze code (a TC 520 with a closing code 72, 76 or 77) is present on the account.

    2. Cases that are returned from Appeals.

Cases with -L or -W Freeze Codes

  1. Any IDT or RPM case that contains a -L or -W freeze should be reviewed on IDRS to determine if the case is in Appeals status. See Document 6209, IRS Processing Codes and Information, Section 13, Appeals and TE/GE, Status Codes for Appeals.

    Reminder:

    A TC 520 with a closing code 72, 76 or 77 indicates the case is in Appeals status.

  2. Once the Appeals Status Code is identified, follow the chart below for the proper handling of the case:

    If the Case is AIMS Status: And Then
    1) 80 – Non Docketed The taxpayer has provided sufficient documentation to determine whether the taxpayer is a victim
    • Review all taxpayer documentation and evaluate the claim, following normal procedures.

    • Perform all necessary account adjustments.

    • Inform the taxpayer of the outcome, following normal procedures

    • Prepare Form 10467, Appeals Division Feedback Report and Transmittal Memorandum with the determination and all actions taken; include a copy of the letter issued to the taxpayer that reflects the determination.

      Note:

      If the CP 01 will serve as the closing letter, or no letter is required to be sent include this information on the Form 10467.

    • Forward Form 10467 to Appeals via secured e-mail to: *AP Inquiries. See, , Format for E-mails to Appeals, for additional information.

    • Close case on CIS following normal procedures

    2) Status 80 – Non Docketed The taxpayer has not provided sufficient documentation to determine whether the taxpayer is a victim
    • Review all taxpayer documentation and evaluate the claim, following normal procedures.

    • Input TC 290 .00 with a reason code 131 or 139, as applicable.

    • Inform the taxpayer of the outcome, following normal procedures.

    • Prepare Form 10467 with the determination and all actions taken. If the taxpayer does not respond to a request for information or if their submitted information is incomplete, notate on the form the documentation still needed for a determination to be made. If the claim is denied, include the reason for the denial; include a copy of the letter issued to the taxpayer reflecting the determination.

    • Forward Form 10467 to Appeals via secured e-mail to: *AP Inquiries. See, Exhibit 25.23.10-1 , Format for E-mails to Appeals, for additional information.

    • Close case on CIS following normal procedures.

    3) Status 82 Docketed Appeal (TC 520 with a closing code 72). Regardless of whether the taxpayer has provided sufficient documentation to determine whether the taxpayer is a victim
    • Review all taxpayer documentation and evaluate the claim.

    • Do not adjust the account.

    • Do not issue a closing letter; Appeals will address the determination with the taxpayer.

    • Prepare Form 10467 with the determination and all actions taken. If the taxpayer does not respond to a request for information or if the submitted information is incomplete, notate on the form the documentation needed for a determination to be made. If claim is denied, include the reason for the denial.

    • Forward Form 10467 to Appeals via secured e-mail to: *AP Inquiries. See, Exhibit 25.23.10-1, Format for E-mails to Appeals, for additional information.

    • Close case on CIS as a MISC.

    Note:

    Cases currently in AUR or ASFR inventory will be worked by AUR or ASFR as applicable following this guidance and not transferred to IDTVA Exam as outlined in the IDTVA Routing Matrix.

    Note:

    If a taxpayer is alleging IDT on multiple years, Appeals will only address the year under its jurisdiction. The tax years not under Appeals jurisdiction must be worked following normal procedures.

  3. If the case is Collection Due Process (CDP), identified by a TC 520 with a closing code of either 76 or 77, then follow the directions for AIMS status 80 Non-docketed from the table in (2) above.

Taxpayer Requests a Reconsideration Appeal of an Invalid Identity Theft Determination

  1. If a taxpayer’s IDT claim is determined to be invalid and the taxpayer indicates he/she wants his/her case to be reviewed by the Appeals Function, the taxpayer must show he/she made an attempt to document his/her entitlement through the reconsideration process, and his/her request had been denied. All evidence provided by the taxpayers must be reviewed by the examiner before the referral to Appeals. Refer to IRM 8.2.1.5, Returning a Case to Examination - ATE, and IRM 8.2.1.6, Preliminary Review of a Case - ATE. For these cases and any case previously worked by Appeals, complete the steps below before sending the case to Appeals.

    1. Close the CIS case as a route to Appeals. Input a TC 470 to ensure that the taxpayer is not subjected to collection activity pending the appeal of the IRS determination.

    2. Send Letter 86C, Referring Taxpayer Inquiry/Forms to Another Office to the taxpayer advising the case is being transferred to Appeals. Include the following open paragraph, "As you requested, we are transferring your case for a hearing with an independent appeals officer. During the time your case is in Appeals, we will not pursue any collection activity on your account. However, you should know that interest and applicable penalties will continue to accrue if there is still a balance due after the Appeals decision. Therefore, you might want to make voluntary payments during the time Appeals is considering your case to minimize any interest or penalties if you ultimately do owe."

    3. Forward the case to the appropriate Appeals Office per the Appeals Routing guidelines below in (4).

      Note:

      Denied RPM reconsideration claims should not be referred to Appeals if the taxpayer disagrees with the determination. On denied RPM claims, the taxpayer’s only right is to file suit to recover tax, penalties or other amounts with the United States District Court that has jurisdiction or with the United States Court of Federal Claims.

  2. Complete Form 3210, Document Transmittal, and include the following information:

    • Sender’s full name, Stop Number, Mailing Address and Phone Number.

    • A full description of items being sent.

    • The taxpayer’s name and SSN.

    • Tax period(s) of cases being sent.

  3. Appeals Case Building Guidelines. The documents below may have to be requested from files or printed from CEAS, the AUR system or AMS. When building the case include the following:

    1. Taxpayer’s original return

    2. Original Compliance Adjustment

    3. Report(s) (example - Form 4549 or CP 2000)

    4. Reconsideration Adjustment (if reply to Recon disallowance)

    5. Work papers

    6. Taxpayer Correspondence

    7. Letters; Initial contact, 30 day, CP 2000, etc.

    8. Statutory Notice of Deficiency

    9. IDRS Research

      Note:

      If requesting administrative files, make two attempts three weeks apart (the second request should be a special search). If the administrative file is not received from Files three weeks after the second request, forward without the requested documents. Attach prints of ESTAB's and any Charge Outs from Files to verify that the documents were requested.

  4. Appeals Routing Guidelines. Ensure cases are routed to the correct Appeals office as identified by the Appeals Office code. Consult Appeals website at Appeals Case Routing for case routing addresses. See IRM 4.13.7-5, Appeals Account Resolution Specialist.

    Note:

    Communication between the referring function and Appeals that address the strengths and weaknesses of the issues and positions of the parties, accuracy of the facts, credibility or cooperation of the taxpayer, etcetera, are prohibited unless the information communicated has been shared with the taxpayer. However, communication between the referring function and Appeals relating to ministerial, administrative or procedural matters are permissible. Refer to sections 2.02(6) and 2.03(3) of Rev. Proc. 2012–18, Ex Parte Communications Between Appeals and Other Internal Revenue Service Employees, for additional discussion regarding ex parte communication with Appeals

    .

Cases Returned from Appeals

  1. If a case originated in a campus, the taxpayer petitioned Tax Court or requested an Appeals hearing and the IDT/RPM allegation is a new issue or new information was provided, Appeals may return cases to the IDTVA-C to review and address the IDT or RPM allegation, provided that there is sufficient time remaining on the statute of limitations.

  2. Appeals will review the case to determine whether the taxpayer has provided new information that was not previously shared with Compliance or if the taxpayer is alleging an IDT/RPM claim for the first time. It is considered a new issue if the taxpayer did not raise the IDT/RPM allegation during the Compliance process.

  3. Appeals will retain jurisdiction of docketed or CDP cases when forwarding to IDTVA-C. Appeals will release jurisdiction back to IDTVA-C on non-docketed cases.

  4. Appeals will send via e-mail cases where the taxpayer has submitted new information or raised a new issue in Appeals to the appropriate function, as outlined below

    1. RPM cases will be routed to *W&I IDT:KC:SPEC:EXAM

    2. IDT cases will be routed to *WI EEF IDTVA OP3 D3 T306

  5. All referrals from Appeals will contain Form 10467, Appeals Division Feedback Report and Transmittal Memorandum, and any information the taxpayer provided to Appeals. The Form 10467 will provide sufficient information as to whether jurisdiction was released or retained by Appeals.

  6. All referrals will be scanned into CIS, if the documentation was not previously scanned. The correct category code and OFP codes must be used when creating a case or sending the information to be scanned.

  7. Once the case has been reviewed and a determination made, all docketed and CDP cases received from Appeals must be returned to the originating employee identified on the Form 10467.

Non-Docketed Cases Returned from Appeals
  1. Appeals will return non-docketed cases to IDTVA-C when Appeals determines the IDT or RPM claim is a new issue or that the taxpayer provided new information that was not previously considered by Compliance, if there are at least 210 days remaining on the statute of limitations

  2. All returned non-docketed cases should be scanned and assigned directly to an examiner. The assigned examiner will review the documentation provided by Appeals and determine if the IDT or RPM allegation is valid following normal procedures.

  3. If the campus cannot work the case (referred in error) or the IDT or RPM was previously addressed by IDTVA-C:

    1. Complete the explanation section of the Form 10467, Appeals Division Feedback Report and Transmittal Memorandum. Ensure to document the reason the case is being returned, (i.e. previously adjusted) and annotate the previous determination.

    2. Return case and Form 10467 back to the originating Appeals employee.

    3. Close the CIS case.

  4. Upon review of the case, if the taxpayer is determined to be a "Victim of IDT" , complete all account adjustments. Do not return the case to Appeals. Close following normal procedures.

  5. If the taxpayer is determined to be "Not a Victim of IDT" , document the determination on the Form 10467; do not return the case to the originating Appeals employee. Route the Form 10467 using the following link, Appeals Case Routing and the steps below:

    1. In the "To Appeals from External Sources" section, select the "Case Routing Addresses and Instructions" link.

    2. Click on "Spreadsheet Tool" and the Case Routing Guide will open up.

    3. Using the drop down button, select the "Campus Location" . Select the campus where the Compliance case originated and mail the case to the address provided.

      Example:

      If the case is an AUR case that originated in Austin (TC 922 DLN starts with 18), select "Austin" from the drop down menu in the "Campus Location" field.

Docketed Cases Received from Appeals
  1. On docketed cases where the IDT/RPM claim has not been considered by Compliance, new information is received by Appeals not previously considered or the IDT/RPM claim is considered a new issue, an Appeals Officer (AO) will forward the Form 10467 and information package to the appropriate IDTVA-C function via secured e-mail.

  2. Appeals will retain jurisdiction of the case. In docketed cases, time is of the essence. Any docketed cases received must be worked within 45 days of receipt, unless additional documentation is needed from the taxpayer. Review the documentation provided by Appeals and determine if the IDT/RPM allegation is valid following normal procedures.

  3. If additional documentation is needed and the 45 day time frame cannot be met, contact the AO to reach a new response date. If the taxpayer does not reply to a request for additional information, do not deny the claim following normal procedures. Inform Appeals of the determination. The denial will be addressed by Appeals.

  4. If the case is determined to be IDT/RPM, "no account adjustments" will be input. Complete Form 10467 with sufficient information to determine the necessary account adjustments. Appeals will input the account adjustments based upon the settlement agreement from the Tax Court.

  5. Complete the explanation section of Form 10467, documenting the determination. The explanation should be explicit, outlining all documentation received, determination made and any potential account adjustments.

    Example:

    On an allowed RPM determination, the following information must be documented:

    • List of documentation submitted by the taxpayer

    • Applicable RPM category code (i.e., TC 504 AC RPM 3)

    • Preparer Information

    • Refund trace results, if applicable

    • Items inflated by the preparer

    • Relief to be provided to the taxpayer – i.e., refund in the amount of X should be released to the taxpayer.

    • Underreported income that remains underreported on the return as intended to be filed or items disallowed by Exam, if applicable.

    Example:

    Taxpayer was audited for filing status, exemptions, Earned Income Credit. The taxpayer has substantiated 2 of the 3 exemptions being disallowed by Exam. Annotate which exemptions are still in question.

  6. If the campus cannot work the referral package, i.e., the IDT/RPM was previously worked by IDTVA-C or referred to IDTVA-C in error:

    1. Complete the explanation section of the Form 10467. Ensure to document the reason the case is being returned, (i.e. previously adjusted) and annotate the previous determination.

    2. Return Form 14067 to the originating Appeals employee via secured e-mail.

    3. Close the CIS case.

  7. If a RPM claim is denied and meets the criteria to be referred to Exam, do not send to Cat A. Clearly identify the RPM issues between the posted return and the return as intended to be filed on the Form 10467. Appeals will address the Cat A issues.

  8. If an IDT claim contains a return from the SSN owner that requires processing and meets the DIF Bypass Criteria, do not refer to Exam. Inform Appeals that the return from the SSN owner must be assessed.

  9. Docketed cases received from Appeals will be scanned into CIS, if the documentation was not previously scanned. The correct category code and OFP codes must be used when creating a case or sending the information to be scanned.

Collection Due Process Cases Returned from Appeals
  1. Appeals Officer (AO) will forward Collection Due Process (CDP) referral packages to IDTVA-C via secured e-mail, when Appeals determines the IDT/RPM claim is a new issue or new information was received that was not previously addressed by Compliance.

  2. The package will include documentation received in Appeals and Form 10467, Appeals Division Feedback Report and Transmittal Memorandum.

  3. Appeals will retain jurisdiction of the case. In CDP cases, time is of the essence. Any CDP cases received must be worked within 45 days of receipt, unless additional documentation is needed from the taxpayer.

  4. Review the documentation provided by Appeals and determine if the IDT/RPM allegation is valid following normal procedures.

  5. If additional documentation is needed, and the 45 day time frame cannot be met, contact the AO to reach a new response date. If no reply on requests for additional information, deny the claim and return to Appeals following normal procedures.

  6. If the case is determined to be IDT/RPM, all account adjustments must be input prior to replying to Appeals. The explanation section of Form 10467 must be completed with the determination, all actions taken, a copy of the closing letter to the taxpayer explaining the determination. Return the case to the originating Appeals employee via secured e-mail.

  7. If the campus cannot work the case, i.e., the IDT/RPM was previously addressed by IDTVA-C or referred to IDTVA-C in error:

    1. Complete the explanation section of the Form 10467. Ensure to document the reason the case is being returned, (i.e. previously adjusted) and annotate the previous determination.

    2. Return Form 14067 to the originating Appeals employee via secured e-mail.

    3. Close the CIS case.

  8. If the RPM claimed is denied and must be referred to Exam, forward the case to Cat A following normal procedures. Include a statement that the case is CDP and request that the case be returned to Appeals upon completion of the audit. Include the Appeals employee name so the case can be referred back correctly. Inform the Appeals employee of the referral to Exam and all actions taken.

Post Function Referral Procedures

  1. DITA was established to address post function account adjustments to resolve IDT accounts. These cases require adjustment activity beyond the IRM or procedural scope of the referring function. Once a function has completed all of the actions for which they are procedurally responsible, the case is referred to DITA for the remaining actions needed to make the taxpayer whole. Referrals can be submitted on a:

    • Form 3870, Request for Adjustment

    • Form 4442, Inquiry Referral

    • Form 4844, Request for Terminal Action to input the appropriate ID Theft indicators, such as TC 971 AC 522 and TC 972 AC 522.

  2. All Large Business & International (LBI), Field Examination, Field & Specialty Collection and IDTVA-C post function referrals will be routed to the DITA team located in Philadelphia. Contact information can be found at: Functional ID Theft Liaisons.

  3. Any non-IDT, mixed entity, or scrambled SSN cases will be rejected back to the originating function.

  4. Prior to referring the case to the DITA, if a current year account, input a TC 971 AC 850 if entire credit is frozen on account or if conditions in IRM 21.4.1.5.7.1 (4),Direct Deposit of Refunds, are present. The input of the TC 971 AC 850 ensures any subsequent refund will not be direct deposited and will be issued as a paper check.

  5. If the referral is incomplete, DITA will contact the referring operation and request that the missing information be provided or corrected. If DITA is unable to obtain the necessary information, then the referral will be rejected.

    Note:

    DITA will update the CIS case data to reflect the referring function’s information and will document in a case note the reason for rejection.

  6. Do not input any adjustments or transfer any credits on ANY tax module, once it has been determined that an IRSN is required. DITA will complete all IDRS account actions on modules requiring an IRSN. When the taxpayer’s case involves multiple years but not all require an IRSN assignment, all years will be referred to DITA.

    Exception:

    ASFR and SFR assessments must be resolved before the case can be referred to DITA.

  7. The referring function is responsible for statute screening prior to referring to DITA following guidance in IRM 25.23.2.12, Statute Protection.

  8. It is important to verify the statute dates on the TC 150 return and any unprocessed returns included in the identity theft case.

  9. Referring functions will input a protective assessment on accounts within 180 days of the statute at the time of the referral. Update the CIS case to priority code ‘2’. Indicate the case was statute cleared. Document the action taken in a case note, and attach the completed Form 2859 to the case. See IRM 21.5.1.5.3(5), CIS Source Documentation for instructions on attaching documents to a case.

  10. DITA does not issue Form 9409, IRS/SSA Wages Worksheet. The referring function will complete Form 9409 before sending the referral to DITA.

  11. The referring function will address any collection activity for all impacted years prior to making a referral to DITA. A case note will need to be input on the CIS system documenting what collection actions were taken. See IRM 25.23.4.7.6, Collection Activity - Form 14394/13794 for additional information.

  12. Unprocessed returns should be processed per IRM 25.23.10.7 , Unprocessed/Secured Returns - General before referring to DITA. DITA will refer to Exam when meeting the DIF Bypass criteria on all campus referrals after the adjustments are input.

  13. Referrals to DITA must provide information on the determination made and the adjustments needed to correct the account of Form 3870, Request for Adjustments or Form 4442, Inquiry Referral, as applicable. Include the following information:

    Note:

    All specialty functions are required to include Form 4442 regarding account adjustments needed (i.e. TY 2013 needs to be moved to an IRSN; TY 2014 treat as a nullity). Attach the Form 4442 to the CIS record.

    1. Tax Years impacted

    2. Determination made

    3. Indication of any statute issues

    4. Collection actions taken

    5. When easily identified the referral should include payments/credits by amount, date and where they should be moved, rather than refunded.

    6. Legible copies (marked as copies) of the identity theft claim, pertinent taxpayer correspondence and/or supporting documents.

    Note:

    If further action is required on a case after DITA resolves the IDT issue, notate on the request to have the case returned to the referring function upon completion (e.g., AUR open cases).

  14. IDRS Category Code IDI5 is designated for all IDTVA identity theft referrals to DITA from a Campus operation. IDRS Category Code IDI6 is designated for all IDTVA identity theft referrals to DITA from a Field operation.

  15. The referring campus will reassign the case through the CIS system to employee number 1189071134. The following Case Data information will need to be updated before the case is reassigned:

    • Activity code will be updated to (Function)2DITA

      Example:

      AUR2DITA, CSCO2DITA etc.

    • Category code will be updated to IDI5

    • Verify Case History status is active (A)

  16. TAS and AM IPSU – will only route ITAR and identity theft TAS referrals to DITA if the issue is the length of time to resolve the account and there is an existing open control assigned to IDRS groups 1189X. The referring specialized team is responsible for resolving all functional TAS and ITAR issues.

  17. When referring cases closed as TAS or ITAR to DITA, the referring team will leave a notation of ‘OAR’ or ‘ITAR’ in a case note.

  18. Field Examination, Field & Specialty Collection and LB&I Operations are not required to open IDRS controls. Upon receipt of a case from Field & Specialty Collection, Field Exam or LB&I, DITA will send the case documents to ICT to be scanned. The IRS received date will be the date the referral was received in DITA, in accordance with IRM 21.5.1.4.7, Taxpayer Inquiry Referred from Other Functions. Open an IDRS control base using category code IDI6 and one of the following activity field codes:

    • Specialty Collection - SPCLCOLL

    • Field Collection - FLDCOLL

    • Field Exam - FLDEXAM

    • LB&I - LBI

Compliance Case Processing

  1. This IRM section and all subsequent sections provide specific guidance for IDTVA cases involving Compliance issues which includes CSCO, ACSS, AUR, EXAM and DITA.

IDTVA-C CSCO Identity Theft Case Processing

  1. This IRM section provides specific guidance for Identity Theft Victim Assistance (IDTVA) cases involving Automated Substitute for Return (ASFR) and Compliance Services Collection Operation (CSCO) issues.

IDTVA-C CSCO Initial Receipt Clerical Actions
  1. The instructions in this section should be used in conjunction with the instructions in IRM 25.23.4.4.1, IDTVA-C Case Referrals from Compliance Functions and IRM 25.23.10.2, Case Batching.

    Note:

    Refund Hold cases should be batched with the appropriate doc type and Priority Code 1.

  2. Upon receipt of potential IDT correspondence, the Identity Theft Victim Assistance Compliance, Services Collection Operation (IDTVA-C CSCO) group should:

    1. Verify that appropriate documentation was received (Form 14039, Identity Theft Affidavit, a police report or Form 14157, Return Preparer Complaint). If none is present return to Compliance for them to take actions to obtain the appropriate form.

    2. Ensure that TC 971 AC 522 UNWORK is on the account per IRM 25.23.2.15.1, Tracking IMF Tax-Related Identity Theft Inventory. For BMF see IRM 25.23.9, BMF Identity Theft Processing.

    3. Suspend collection and input TC 470 with no closing code.

    4. Send the appropriate acknowledgement letter per IRM 25.23.10.3, Letter Procedures, to the address on the documentation unless a better address is available.

Automated Substitute for Return (ASFR) Case Processing
  1. The table below provides actions taken when an ASFR account has been identified as involving Identity Theft. If unable to determine the appropriate amount of tax balance based on the information provided, skip to paragraph (2) below:

    If it is determined the taxpayer is a victim of Identity Theft, they made a valid IDT claim and removal of the income results in a tax balance that is ≡ ≡ ≡ ≡ ≡ ≡ or more, Then
    1) A 30 day letter was issued or a 90 day letter was issued
    • Remove the Identity Theft income from ASFR and update the case major.

    • Choose menu #28 on the ASFR Entity screen to input a history on the module showing partial income was removed due to Identity Theft.

    • Update the module to Status 031 to issue a corrected letter.

    • Input TC 971 with AC 501 to mark the account as resolved. See also IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with a TC 472.

    • Document CIS and close case.

    Exception:

    If the correspondent is an Individual Taxpayer Identification Number (ITIN) taxpayer see IRM 25.23.2.19.5, Employment-related Identity Theft-TC 971 AC 525. Retain Identity Theft verification to be associated with the ASFR default.

    2) And there is a default assessment posted on IDRS,
    • Utilizing the appropriate IAT tools input a TC 291 adjustment to correct the assessment (including appropriate reference amounts, withholding, and estimated penalty).

    • Resolve Credits. Refer to IRM 21.5.8, Credit Transfers.

    • Input TC 971 with AC 501 to mark the account as resolved. See also IRM 25.23.2.18, Closing Identity theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

    Exception:

    If the correspondent is an ITIN taxpayer see IRM 25.23.2.19.5, Employment-related Identity Theft-TC 971 AC 525. Retain Identity Theft verification to be associated with the ASFR default.


    If it is determined the taxpayer is a victim of Identity Theft and they provide the required IDT claim, AND removal of the income results in a tax balance of less than ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Then
    1) A 30 day letter was issued
    • Utilizing the appropriate IAT tools, input a TC 590 CC 088, TC 290 for $.00 and CRN 887 for .01-.

    • Resolve Credits. Refer to IRM 21.5.8., Credit Transfers.

    • Update ASFR to Status 076.

    • Input TC 971 with AC 501 to mark the account as resolved. See IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

    Exception:

    If the correspondent is an ITIN taxpayer see IRM 25.23.2.19.5, Employment-related Identity Theft-TC 971 AC 525.

    2) A 90 Day Letter was issued
    • Utilizing the appropriate IAT tools, input a TC 590 CC 088, TC 290 for $.00 and CRN 887 for .01- , input TC 495 with STN90.

    • Resolve Credits. Refer to IRM 21.5.8, Credit Transfers.

    • Update ASFR to Status 076.

    • Input TC 971 with AC 501 to mark the account as resolved. See IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

    Exception:

    If the correspondent is an ITIN taxpayer see IRM 25.23.2.19.5, Employment-related Identity Theft-TC 971 AC 525.

    3) And there is a default assessment posted on IDRS,
    • Utilizing the appropriate IAT tools back out the ASFR assessment.

    • Resolve Credits. Refer to IRM 21.5.8, Credit Transfers.

    • Input TC 971 with AC 501 to CC ENMOD to close the case. See also IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

    Exception:

    If the correspondent is an ITIN taxpayer see IRM 25.23.2.19.5, Employment-related Identity Theft-TC 971 AC 525.

    If it is determined the taxpayer is a victim of Identity Theft, and the required IDT claim has been provided, AND they file a return Then
    1) And a 30-Day Letter was issued
    • Update ASFR Status

      1. For a return with zero tax, use Status 101.

      2. For a return showing tax, use Status 103.

    • Input TC 599 CC 089 to set the Assessment Statute Expiration Date (ASED).

    • Utilizing the appropriate IAT tools input an adjustment to the verified return figures, as allowable. See IRM 25.23.4.7.3.2, IDTVA-Additional Research and Actions Required procedures.

      1. Use Blocking Series 54, unless following Math Error or Disallowance Procedures.

      2. Include Priority Code 2, Hold Code 3, and Reason Code 139.

    • Resolve Credits. Refer to IRM 21.5.8, Credit Transfers

    • Delete wages not earned by the taxpayer. See IRM 25.23.4.12.7, Form 9409 Procedures-IRS/SSA Wages Worksheet for additional information.

    • Input TC 971 with AC 501 to CC ENMOD to close the case. See also IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

    2) And a 90-Day Letter was issued
    • Update ASFR Status

      1. For a return with zero tax, use Status 101.

      2. For a return showing tax, use Status 103.

    • Input TC 599 CC 089 to set the ASED.

    • Utilizing the appropriate IAT tools input an adjustment to the verified return figures, as allowable. See IRM 25.23.4.7.3.2, IDTVA-Additional Research and Actions Required, procedures.

      1. Use Blocking Series 32, unless following Math Error or Disallowance Procedures.

      2. Include Priority Code 2, Hold Code 3, and Reason Code 139.

    • Input TC 495 with STN90.

    • Resolve Credits. Refer to IRM 21.5.8, Credit Transfers.

    • Delete wages not earned by the taxpayer. See IRM 25.23.4.12.7, Form 9409 Procedures-IRS/SSA Wages Worksheet for additional information.

    • Input TC 971 with AC 501 to CC ENMOD to close the case. See also IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

    3) And a default assessment posted to IDRS
    • Input TC 599 CC 089 to set the ASED.

    • Utilizing the appropriate IAT tools input an adjustment to the verified return figures, as allowable. See IRM 25.23.4.7.3.2, IDTVA-Additional Research and Actions Required procedures.

      1. Use Blocking Series 00, unless following Math Error or Disallowance Procedures.

      2. Include Hold Code 3 and Reason Codes 068 and 139.

    • Resolve Credits. Refer to IRM 21.5.8, Credit Transfers

    • Delete wages not earned by the taxpayer. See IRM 25.23.4.12.7, Form 9409 Procedures-IRS/SSA Wages Worksheet for additional information.

    • Input TC 971 with AC 501 to CC ENMOD to close the case. See IRM 25.23.2.18, Closing Identity Theft Issues. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS and close case.

  2. When the taxpayer does not provide sufficient information and a determination cannot be made through internal research, see IRM 25.23.10.4, Corresponding with the Taxpayer, to obtain the necessary information from the taxpayer.

    If the taxpayer does not provide the requested information by the date provided Then
    1) And a 30-Day Letter was issued
    • Continue ASFR processing.

    • Input TC 972 AC 522 NORPLY in FRM77.

    • If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Update ASFR to Status 030 if the follow-up date has not expired. If the follow-up date has expired update ASFR to Status 030 using the expired follow-up date. Refer to IRM 5.18.1.5.15, ASFR Follow-Up or Action Dates.

    • Per local procedures, close or update IDRS control. Input activity that ASFR processing will continue.

    • Notify Taxpayer that ASFR processing will continue. Refer to IRM 25.23.10.3, Letter Procedures .

    2) And a 90-Day Letter was issued
    • Continue ASFR processing.

    • Input TC 972 AC 522 NORPLY in FRM77.

    • If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • An update on ASFR is not necessary unless the module is in a failed condition status or any other status that suspends the case.

    • Per local procedures, close or update IDRS control. Input activity that ASFR processing will continue.

    • Notify Taxpayer that ASFR processing will continue.

    • Refer to IRM 25.23.10.3, Letter Procedures .

    3) And there is a default assessment posted to IDRS
    • On IDRS, input a TC 290 for .00, and close the control base. Input a CIS history stating the taxpayer’s response was insufficient.

    • Notify taxpayer that response was insufficient and that collection activity will resume. Refer to IRM 25.23.10.3, Letter Procedures .

    • Input TC 972 AC 522 NORPLY in FRM77.

    Note:

    The SECONDARY-DT field on TC 972 is a required field. The tax year claimed as Identity Theft should be input using the format MMDDYYYY. See IRM 25.23.2-11, IMF Only TC 972 AC 522 - Reversal of TC 971 AC 522.

  3. When deleting wages, correct the taxpayer's records by preparing Form 9409, IRS/SSA Wage Worksheet.

    Note:

    Refer to IRM 25.23.4.12.7, Form 9409 Procedures-IRS/SSA Wages Worksheet for additional information.

  4. If it is determined that an ASFR assessment was processed on an ID Theft case, and if when reversed the tax liability is zero, and there is a TC 360 (lien fee assessment) posted, request to abate the Lien Fee. If there is a TC 582, see guidance in IRM 25.23.4.7.6.2, Collection Activity-Form 13794 Additional Actions Required – LIEN.

    Reminder:

    If OIC indicated on account contact the assigned OIC employee or locate case using SERP Who/Where to coordinate next case action with OIC.

Return Delinquency Identity Theft
  1. When an allegation of Identity Theft is made, you must determine if the taxpayer has a filing requirement. For additional procedures on determining liability see IRM 5.19.2.6.4.6, IMF – Determining Liability.

  2. Update the taxpayer’s module(s) with TC 590 CC 020 per IRM 25.23.2.18.5, Closing Identity Theft Cases with Tax Delinquency Inquiries (TDI). Input the appropriate identity theft indicators per IRM 25.23.2.18, Closing Identity Theft Issues.

  3. Inform the taxpayer in writing the issue has been resolved. Include information for any other unresolved delinquencies. Refer to IRM 25.23.10.3, Letter Procedures.

  4. Complete Form 9409, IRS/SSA Wage Worksheet, as appropriate. See IRM 25.23.4.12.7, Form 9409 Procedures-IRS/SSA Wages Worksheet.

Offer In Compromise (OIC) - Identity Theft Offer Determinations
  1. Determine if the Identity Theft issue was the only basis for the offer or the issue did not affect the tax year in question. See table below for closing instructions:

    If Then
    1) The Identity Theft was the only basis for the offer,
    1. Send the taxpayer Letter 5064C, ID Theft In-Process Letter indicating the ID theft issue has been transferred. See also IRM 25.23.10.3, Letter Procedures.

    2. A TC 470 CC 090 must be input on the account to suspend collection activity. If the account is in status 71 take the following actions:

      • Monitor for reversal of status 71

      • Input TC 470 CC 090 once status 71 is reversed.

    3. Follow instructions in IRM 25.23.10, Compliance Identity Theft Case Processing, for any corrections on the account.

    4. Document CIS

    2) ID Theft was claimed by the taxpayer but did not impact the tax year of the offer
    1. Follow normal processing guidelines and forward the offer.

    2. Follow TC 971/522 guidelines and referral procedures to address the Identity Theft claim. See IRM 25.23.4.7.7, Case Transfer Within IDTVA. If the case is on CIS reassign the case to the appropriate IDTVA function. If the case is not on CIS, then batch to the appropriate IDTVA function.

    3. Send the taxpayer Letter 5064C,, indicating the ID theft issue has been transferred. See also IRM 25.23.10.3Letter Procedures.

    4. Document CIS

Offer In Compromise (OIC) - Identity Theft Referral Procedures
  1. Determine the source of the Identity Theft liability (Exam, SFR. AUR).

  2. Refer the case to the appropriate Identity Theft Victim Assistance (IDTVA) function, see IRM 25.23.4.7.7, Case Transfer Within IDTVA. If the case is on CIS, reassign the case to the appropriate function. If the case is not on CIS, then batch to the appropriate function. Attach any documentation received from the taxpayer or representative. If the Identity Theft claim was made on the Form 656-L, Offer in Compromise (Doubt as to Liability) before forwarding, ensure the Form 656-L is stamped "Returned" .

  3. Send the taxpayer a Letter 5064C indicating the ID theft issue has been transferred.

  4. To address the offer disposition, Refer to IRM 25.23.10.12.1.4, Offer In Compromise (OIC) - Identity Theft Offer Determinations.

  5. Document CIS.

IDTVA-C ACSS Identity Theft Case Processing

  1. This IRM section provides specific guidance for Identity Theft Victim Assistance (IDTVA) cases involving Automated Collection System Support issues.

IDTVA-C ACSS Receipt Procedures
  1. When cases are received into ACSS IDTVA, they go through a clerical and technical screening process. Follow the subsequent instructions in this section for this process.

IDTVA-C ACSS Initial Receipt Clerical Actions
  1. The instructions in this section should be used in conjunction with the instructions in IRM 25.23.4.4.1, IDTVA-C Case Referrals from Compliance Functions and IRM 25.23.10.2, Case Batching

  2. Upon receipt of potential IDT correspondence, the IDTVA-C, Automated Collection System Support (IDTVA-C ACSS) group should:

    1. Verify that appropriate documentation was received (Form 14039, Identity Theft Affidavit, police report or Form 14157, Return Preparer Complaint). If none is present return to ACSS for them to take actions to obtain the appropriate form.

    2. Ensure that TC 971 AC 522 UNWORK is on the account per IRM 25.23.2.15.1, Tracking IMF Tax-Related Identity Theft Inventory. For BMF see IRM 25.23.9, BMF Identity Theft Processing.

    3. Suspend collection and input TC 470 with no closing code.

    4. Refer to screener for review. See IRM 25.23.10.12.2.1.2, IDTVA-C ACSS Screener Procedures, for details.

  3. Upon return from the screener, the clerk should:

    1. Update Account on ACS to appropriate function code with 180 days follow-up “TOXX,180,IDT”.

    2. Send appropriate acknowledgement letter per IRM 25.23.10.3, Letter Procedures, to the address on the documentation unless a better address is available.

    3. If the taxpayer has requested an installment agreement with the documentation, send case to the screener to review for input of the TC 971 AC 043 and mark the case with a tag to identify "IA Requested" for additional actions later.

      Note:

      If the taxpayer has requested an IA, input TC 971 AC 043 when the request meets pending IA criteria, see IRM 5.19.1.5.4.7, Pending IA Criteria, and the clerk will complete Letter 5064C, ID Theft In-Process Letter, with the IA notification paragraph if referred out.
      "We have received your installment request; however, we cannot setup the installment agreement until the Identity Theft issue has been resolved. If you believe you will have a balance due after those actions, you may continue to make voluntary payments to reduce the balance due while we resolve your identity theft issue. Once that is completed, we will set up the installment agreement for you."

IDTVA-C ACSS Screener Procedures
  1. A Screener is being utilized to identify the appropriate place for the case to be resolved and identify any levy issues.

  2. Determine if a levy is active on the account, and release the levy if applicable. See IRM 25.23.10.12.2.6.1, Active Levies, for additional information.

  3. Caution:

    Levies must be released by GS-06 or higher employees.

  4. Research to identify the appropriate IDTVA function to work the case and document with the appropriate category code for the clerk. Proceed with IRM 25.23.10.12.2.1.1, IDTVA-C ACSS Initial Receipt Clerical Actions.

Form 3870 Received from Field Collection - IDTVA-C Kansas City Only
  1. 3870 received from Field Collection should be provided to the IDTVA-C ACSS Screener for determination of the category code for batching. These cases should be batched with Priority Code 2. No other action is required i.e. no letters should be issued.

IDTVA-C ACSS Preliminary Research Needed for Determining Identity Theft on Cases Meeting ACS IDT Criteria
  1. In some instances taxpayers legitimately believe they are a victim of Identity Theft but are not. By thoroughly researching the account, you will be able to determine if this is the case. These situations are generally the result of a taxpayer error, a tax return preparer error, or an Internal Revenue Service (IRS) processing error. This is more common with taxpayers who share their name with a relative.

  2. Account must be well documented prior to reaching a final determination of Identity Theft as well as determining the identities of the victim and of the perpetrator.

  3. Research using Command Codes (CC) ENMOD, IMFOL, RTVUE, NAMES, INOLE, DFAST, DUPOL, FFINQ, REINF, and IRPTR, etc., if applicable.

    Note:

    Use of the IAT aMend tool is mandatory when resolving IDT cases. See IRM 21.2.2-2, ACCOUNTS MANAGEMENT MANDATED IAT TOOLS, for a list of tools required for IDTVA

    .

  4. Research for a different TIN, using spouse and dependent information whenever available and applicable.

  5. Research to see if the taxpayer was previously assigned an ITIN using the ITIN RTS database. In some situations individuals use another taxpayer's SSN for employment purposes. These individuals may have already been assigned an ITIN, under which they have filed a tax return. Do not input the TC 971 AC 522 when the ITIN taxpayer reports the misuse of the SSN. Make no contact with the SSN owner.

    Example:

    An individual responds to the LT11 and states this is not my SSN but does file using an ITIN number. The individual states he is using the SSN for employment purposes only. No information is received from the owner of the SSN indicating Identity Theft. In the example above, a TC 971 AC 522 will not be input. If the TC 971 AC 522 has already been input, reverse using TC 972 AC 522 with source code "IRSERR". This will not be considered tax-related Identity Theft per IRM 25.23.2.16, Initial Allegation or Suspicion of Tax-Related Identity Theft - IMF Identity Theft Indicators. Cases where another person's SSN is used for employment purposes and the user files tax returns under an ITIN are not considered IDT. If there is an Identity Theft associated TC 470 reverse it with TC 472.

  6. Compare all documents and return information for similarities and differences. Research any inconsistencies for a possible TIN.

  7. Always research valid and invalid sides of the TIN in question. This may lead to indications of a mixed entity or scrambled SSN issue, which are not deemed to be Identity Theft. Refer to IRM 25.23.4.6, Multiple Individuals Using the Same TIN-General Guidance for MXEN, and Identity Theft Cases, for determining if the case meets this criteria.

  8. After determining a mixed entity or scrambled SSN exists, return the referral back to the originating function. Notate on the referral that the case is a mixed entity or scrambled SSN and not an IDT case. Case will be reassigned on ACS "TOR1,120,MXEN or SCRM", depending on the case type. See IRM 25.23.4.11, Mixed Entity Procedures and IRM 25.23.10.11, Post Function Referral Procedures.

  9. IRM 25.23.4.7.3, Required Research for Mixed Entity and IDT Cases, IRM 25.23.9.4, BMF Identity Theft Research (Inquiry received via paper or phones) and IRM 25.23.4.5, Identity Theft General Research, also contain additional guidance necessary to reach a final determination.

  10. There may be cases received with prior IVO (Integrity and Verification Operation) involvement. IVO/RICS involvement can be recognized by the following indicators

    1. TC 971(s) with AC 134/617 and or CP 05/05A present on the TXMOD.

    2. A Letter 4464C/4115C/418C has been issued on ENMOD.

    3. IVO control present: IDRS # organizational range 14810-14868 and Category Codes – NCAT, ECAT, NRAM, and ERAM.

      Note:

      If the IVO control is open, close the control base and forward the case to the controlling function. Be sure to attach all correspondence received and document CIS. Reassign the case on ACS "TOO6,90,IVO".

  11. Although an IVO indicator may be present on the account, additional actions may still need to be taken to resolve the taxpayer’s issue.

  12. Complete all necessary adjustments on the case. If cases cannot be resolved through nullification procedures, and must be resolved with an IRSN, refer cases to DITA, per IRM 25.23.10.11, Post Function Referral Procedures. Cases meeting the nullity criteria (refund scheme or IRPTR/IDRS Decision Tree) should be resolved/nullified. For an account to be nullified, the case must meet specific criteria of a Refund Scheme or IRPTR/IDRS Decision Tree. See also IRM 25.23.4.12, Streamline Identity Theft Case Processing (CAT 7)-Nullifying Returns.

  13. Cases with deceased indicators can be identified on CC INOLET or IMFOLE with the actual date of death (DOD) displayed on IDRS. Fraudulent activity on a deceased taxpayer’s account usually occurs very early in the tax year, prior to normal processing time frames, and involves only originally filed returns such as TC 150, TC 976 or TC 977. These may also be identified with a TC 971 AC 524 on CC ENMOD

  14. A list of current Refund Schemes can be found at http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/RICS-IVO/FraudRefundSchemeListing.htm The list of Schemes will be used to make determinations of fraudulent filings. If one of the returns has any of the characteristics listed, the return should be deemed fraudulent if no substantiation can be found on IRPTR. See IRM 25.23.4.12.4, TIN-Related Problems for IRP Data, Refund Scheme or Schedule C, Case Processing.

  15. If the fraudulent return has the characteristics of a Refund Scheme, and no wage/withholding substantiation can be found on IRPTR, consider the return as a "nullity" and process accordingly.

  16. If unable to determine if the fraudulent return is based on a Refund Scheme, utilize the IRPTR/IDRS Decision Tree to determine TIN ownership.

  17. The IRPTR/IDRS Decision Tree criteria is listed in IRM 25.23.4.12.4, TIN-Related Problems for IRP Data, Refund Scheme or Schedule C, Case Processing. A three-year look back period for data is available on IRPTRL and/or IDRS to determine the Common Number (CN) ownership. At least three items from the criteria list must be consistent before making a final determination of the CN owner. Once three items from the listing have been verified, proceed with resolving the case. If there is not three years’ worth of IRP data, but research supports CN ownership, lead/manager must approve the decision to nullify before proceeding with case resolution.

  18. When a prior determination has been made, consider the taxpayer identified as the CN owner to be the owner of the SSN, unless additional research indicates otherwise.

  19. Ownership of the CN must be determined before contacting a taxpayer for additional information. As a starting point, follow guidance in IRM 25.23.4.5, Identity Theft General Research, which includes a list of common characteristics on IDT cases, a link to most common IDT schemes, and information related to mixed entity and scrambled SSN conditions.

  20. If a different TIN is found and is an IRSN, this is an indication of Identity Theft on another year. Continue with the determination process to prepare case for resolution. IRM 25.23.4.5, Identity Theft General Research has additional information.

  21. If a different TIN is not located and IDT is indicated, determine if there is more than one return present. If more than one return is present, follow guidance in IRM 25.23.4.5, Identity Theft General Research.

  22. If no explanation or appropriate document on how the tax account is affected was received, consider internal sources IRM 25.23.4.7.3, Required Research for Mixed Entity and IDT Cases. If a determination cannot be made, follow the guidance in IRM 25.23.10.4, Corresponding with the Taxpayer, to obtain the necessary information.

  23. If there is any question as to the validity of the submitted documentation, consult your manager, lead, and/or IDT Coordinator/Liaison. Additional contact with the submitter of the documentation may be necessary.

Processing Identity Theft Correspondence
  1. ACS Support will receive taxpayer/perpetrator correspondence which should include substantiation previously requested.

  2. Ensure cases are in the O2 inventory on ACS with a 180 day follow-up (i.e., TOO2,180,CORR).

  3. Verify the case has been batched on CIS under OFP 40231 with doc/sub code 1 for IMF IDT and OFP 10412 for BMF IDT. If the case was not identified as an ID theft correspondence or was mis-batched, have the case re-batched as stated above.

  4. Use internal sources to make a determination. If a determination cannot be made, see IRM 25.23.10.4, Corresponding with the Taxpayer, to obtain the necessary information.

  5. After the Form 14039 and/or police report was received IDTVA-C ACSS employees will verify a TC 971 AC 522 UNWORK was input on ENMOD. Specific guidance on the Identity Theft tracking indicators can be found in IRM 25.23.2.15, Tracking and Reporting Identity Theft Cases - Identity Theft Indicators, and IRM 25.23.9.4.2, Individual Taxpayers Reporting to be Victims of Business-Related Identity Theft.

  6. Research the tax years identified on the Form 14039 to determine the source of the assessment related to the Identity Theft. If the tax years identified on the Form 14039 are:

    • Disputing an assessment(s) made by another function, follow the guidance in (7 - 9) below.

    • Not disputing an assessment made by another function and meets ACSS criteria (Status 22/24 and/or TDI -03), follow the guidance starting at (10) below.

    • Meets ACSS criteria and disputes an assessment made by another Compliance function, follow the guidance in IRM 25.23.4.7.1, IDTVA Work Types.

  7. If the Form 14039 and any additional information is disputing an assessment made by another function (e.g., AUR, ASFR, Exam, SFR etc.):

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

    1. Refer the case to the appropriate IDTVA function, see IRM 25.23.4.7.7, Case Transfer Within IDTVA. If the case is on CIS reassign the case to the appropriate function. If the case is not on CIS, then batch to the appropriate function.

      Note:

      If there are multiple years and multiple functions involved, see (8) - (10) below for case routing guidance.

    2. Release all levies for the impacted tax modules.

    3. Reassign the account on ACS to the appropriate "O" inventory function based on the area the case is referred to with a 180 day follow-up: O4 will be used to house all referrals to ASFR/ (e.g., TOO4,180,IDTASFR ). O5 will be used to house all referrals to AUR (e.g., TOO5,180,IDTAUR). O6 will be used to house all referrals to other functions (e.g., TOO6,180,IDTxxxx - "xxxx" = the function or operation the case was referred to such as RPM, CAWR, FUTA, FRIV, AM, CIB, etc.). O7 will be used to house all referrals to Exam (e.g., TOO7,180,IDTEXAM).

    4. Document CIS history with all actions taken, including the referring of the documentation to the specific function.

    5. Use Letter 5064C, ID Theft In-Process Letter, to communicate any other information to the taxpayer, such as acknowledgment that we have received their IA request.

    6. Maintain a complete copy of the IDT case file (original if faxed or copy if mailed) until the account is resolved. This case file can then be destroyed - only pertains to NON-TDI accounts

      Note:

      Refer to IRM 25.23.10.12.2.7.4, 04 Inventory-IDTVA-C ASFR Referrals through IRM 25.23.10.12.2.7.7, O7 Inventory – IDTVA-C Examination Referrals, for additional guidance on referring cases to appropriate functions.

  8. All Compliance functions cannot address or reverse an assessment made by another function. Therefore, a matrix was developed to outline the functions, authority, and where cases will be transferred. See IRM 25.23.4.7.7, Case Transfer Within IDTVA.

  9. When an IDT claim involves multiple years and same functions but different service centers, the case will be referred to the service center based on the most current IDT year.

    Example:

    For 2008 tax year, Exam FSC made the assessment and for 2009 tax year, Exam BSC made the assessment. The case will be referred to Exam BSC based on the 2009 tax year.

  10. If the Form 14039 and any additional information is not disputing an assessment made by another function and meets ACS criteria (Status 22/24 and/or TDI -03), the case will be worked by IDTVA-C ACS Support. Some examples of cases IDTVA-C ACS Support would retain and resolve are original filing issues, subsequent return processing, wrongful levies, TDI issues, etc.

    Note:

    Send amended returns to IDTVA-A via CIS.

    1. Case will remain in O2 inventory and the follow-up date will be extended for 180 days.

    2. Release all levies for impacted tax modules.

    3. Send an acknowledgment letter to the taxpayer/victim within 30 days when IDTVA-C ACS Support receives the IDT claim. Follow guidance as established in IRM 25.23.10.3, Letter Procedures.

  11. After determining that the case meets ACS criteria and that more than one Compliance function is involved for the tax years listed on the Form 14039 and/or police report, follow the guidelines outlined in IRM 25.23.4.7.1, IDTVA Work Types

  12. Research should be performed and documented prior to reaching a final determination of Identity Theft as well as determining the identities of the victim and of the perpetrator. Follow guidance in IRM 25.23.10.12.2.2, IDTVA-C ACSS Preliminary Research Needed for Determining Identity Theft on Cases Meeting ACS IDT Criteria.

  13. If complete research indicates Identity Theft did not occur, do not accept the IDT claim or adjust the account based on the IDT claim. Follow the guidance listed below:

    1. Send Letter 4674C/SP to explain why the claim is not accepted and that collection action will proceed within 30 days (60 days for International) from the date of the letter. Provide the balance due in the letter. Suspend case for 40 days (70 days for international cases).

      Note:

      If the taxpayer made an additional request to resolve the account, take the necessary case actions.

    2. Reassign the case on ACS to the next appropriate function with a 45-day follow-up (75 days for international cases), see IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues.

    3. Input TC 972 AC 522 with source code "NOIDT". See IRM 25.23.2.16.4.2, Invalid Identity Theft Determination-TC 972 AC 522 NOIDT, for more information on the input of TC 972. If there is an Identity Theft associated TC 470 reverse it with TC 472.

  14. If complete research indicates identity theft did occur, the IDT claim will be accepted. At this time make the necessary address and/or name changes, if warranted. Be sure the updated address is in CIS narratives.

  15. Once the determination is made that Identity Theft exists on the tax periods listed on the Form 14039, additional research must be performed to determine if additional years were impacted as well. This is referred to as Complete Case Analysis. See IRM 25.23.4.7.2, Complete Case Analysis.

  16. If the taxpayer requests the NFTL be withdrawn, ask the taxpayer to complete Form 12277, Application for Withdrawal of Filed, Form 668(Y), Notice of Federal Tax Lien (as based on IRC 6323(j)), or otherwise submit a written request for the withdrawal. Forward the request to Collection Advisory with an explanation regarding the withdraw situation. Collection Advisory will determine whether to grant such a request on a case-by-case basis. See IRM 25.23.4.7.6.2, Collection Activity-Form 13794 Additional Actions Required – LIEN, for lien release information.

  17. Review the account and once IDT is confirmed, if needed, complete Form 9409, IRS/SSA Wages Worksheet, for wage income only. See IRM 25.23.4.12.7, Form 9409 Procedures-RRS/SSA Wages Worksheet, for Form 9409 details. Update CIS history with the invalid income sources and record that Form 9409 has been completed.

  18. CIS documentation is required, see IRM 25.23.2.11.1, Documentation of Actions for documentation requirements.

    Note:

    Be sure to include the dates and discussions of all telephone contacts relating to the Identity Theft issue. Also include information used to ensure the person contacted is the same person submitting the IDT claim. All other actions, resolutions, and future next case actions must be documented.

  19. For IMF ID theft taxpayer correspondence use OFP 40231 (40232 – International use) and for BMF ID theft taxpayer correspondence use OFP 10412 (10413 – International use). Report hours and volume for each case resolved or referred.

Identity Theft balance Due Return (TC 150) Not Resulting From Additional Assessment
  1. IRM 25.23.2.17, Identity Theft Claims - Overview, outlines the TC 971 AC 522 source code and secondary date that is to be input on the account at different stages of process from initial ID Theft claim to closure dependent upon case specifics.

  2. Determine if the ID Theft is related to the tax year with the balance due:

    1. Check the Alerts section of AMS to see if there is an open CIS control for ID Theft.

    2. If a TC 971 AC 522 "UNWORK" does not already exist for the tax year in question, input TC 971 AC 522 "UNWORK", and

    3. Use the following chart:

    If And Then
    1) The taxpayer provided an IDT claim, Their ID Theft claim will eliminate the entire balance due, Document CIS with actions taken. Follow account adjustment procedures in:
    • IRM 25.23.4, IDTVA-Paper Process.

    • IRM 25.23.4.7.3.2, IDTVA-Additional Research and Actions required.

    • IRM 25.23.10.12.2.3, Processing Identity Theft Correspondence.

    2) The taxpayer provides an IDT claim, Their ID Theft claim will not eliminate the entire balance due,
    • Document CIS on all actions taken.

    • Send Letter 4674C informing the taxpayer of the remaining balance due.

    • Take next collection action per IRM 25.23.10.12.2.5, Next case Actions - IDT Remaining Collection Issues

    Follow account adjustment procedures in:
    • IRM 25.23.4.7.3.2, IDTVA-Additional Research and Actions Required.

    • IRM 25.23.10.12.2.3, Processing Identity Theft Correspondence.

    3) The taxpayer provides an IDT claim, The research does not support the ID Theft claim,
    • Inform the taxpayer of the “NOIDT” determination.

    • If the taxpayer will be submitting the required documents, input history code with a parameter of 30 days past the deadline date. 60 days past the deadline date on international cases.

    • Reassign case TOV1,45, "DOCREQ" .

    • If the taxpayer drops the ID Theft claim, continue with collection activity and take next appropriate action.

    • Input TC 972 AC 522 "NOIDT" if the taxpayer does not support the claim or drops the claim.

    • If there is an Identity Theft associated TC 470 reverse it with TC 472.

    • Document CIS on all accounts with actions taken.

    • Contact the taxpayer informing of the remaining balance due.

    • Move to next appropriate ACS function for further collection actions.

Next Case Actions, Remaining Collection Issues
  1. If a balance due remains after IDT resolved and closing letter was sent, use the table below

    Caution:

    If prior to closing the IDT case you conducted an adjustment which affects the balance due, send the case to R1,21,IDTFIXD and update AMS for next case action (i.e.; TOE3 then LT16 or LT11 if no final notice).

    If And Then
    1) Levy Source is present FNL NOT date is present for all TDA modules on ACS MOD screen (this means a TC 971 AC 069 has posted). Issue LT16. Assign "TOE4,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOXX,30,IDTFIXD”, “TOXX,30,NOIDT", “TOXX,30,NORPLY”).

    Note:

    If LT16 previously sent xx=01 day.

    Caution:

    DO NOT reassign the case to E3 for systemic levy processing.

    2) Levy Source is present FNL NOT date is not present for all TDA modules on ACS MOD screen (this means a TC 971 AC 069 has not posted). Issue LT16. Assign "TOE2,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOXX,30,IDTFIXD”, “TOXX,30,NOIDT", “TOXX,30,NORPLY”).

    Note:

    If LT16 previously sent xx=01 day.

    Caution:

    DO NOT reassign the case to E3 for systemic levy processing.

    3) No Levy Source is present Telephone number is present. Issue LT 16. Assign "TOCn,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOXX,30,IDTFIXD”, “TOXX,30,NOIDT", “TOXX,30,NORPLY”).

    Note:

    If LT16 previously sent xx=01 day.

    4) No Levy Source is present No telephone number is present. Issue LT16. Assign "TOI2,xx" xx=30 days (60 days for International).(This includes accounts with a foreign address or CLC=35.). Input on ACSWeb (e.g., "TOXX,30,IDTFIXD”, “TOXX,30,NOIDT", “TOXX,30,NORPLY”).

    Note:

    If LT16 previously sent xx=01 day.

    Note:

    If the account is still on ACS but there is no longer a balance due or a return delinquency or if penalties and interest will be eliminated once the adjustment posts, then update the ACS follow-up date with "OADT,30,IDTFIXD". This will allow time for the account to fall off ACS.

  2. If an Installment Agreement or CNC is being requested or reinstated reassign TOS4,30,XXXX as noted below and forward Form 4442 to ACSS.

    Note:

    If Then
    1) The taxpayer is requesting an IA or reinstatement Reassign: TOS4,30,IAPND.
    2) The taxpayer is requesting an CNC or reinstatement Reassign: TOS4,30,CNCPND
  3. If there is a return delinquency only, do the following:

    • If a telephone number is present, assign the account "TOCN,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOCN,30,IDTFIXD”, “TOCN,30,NOIDT", “TOXX,30,NORPLY”).

    • If a telephone number is not present, assign the account "TOI2,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOI2,30,IDTFIXD”, “TOI2,30,NOIDT", “TOXX,30,NORPLY”).

    Note:

    After IDT worked and closing letter was sent, issue a “LT26” before assigning to the appropriate function.

  4. If there is an IRS Campus address on ENMOD do the following:

    • If a telephone number is present, assign the account "TOCN,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOCN,30,IDTFIXD”, “TOCN,30,NOIDT", “TOXX,30,NORPLY”).

    • If a telephone number is not present, assign the account "TOI2,xx" xx=30 days (60 days for International). Input on ACSWeb (e.g., "TOI2,30,IDTFIXD”, “TOI2,30,NOIDT", “TOXX,30,NORPLY”).

  5. Close the monitoring IDRS control bases.

  6. Update CIS with all actions taken (deleted levy source information, telephone contact attempt/made, ACS actions, etc.).

  7. Report time and volume under the appropriate OFP: 40231 (IMF), 40232 (International IMF), 10412 (BMF) or 10413 (International BMF).

  8. File copy should be destroyed as classified waste.

Levies
  1. This section addresses levy issues.

  2. True victims of tax related identity theft which have a levy issued on them, due to no fault of any action taken by the victim, require sensitivity to the impact that a levy is causing on those victims and should be taken seriously. Appropriate actions should be taken to provide relief.

Active Levies
  1. If an active levy:

    • When the taxpayer claims to be a victim of ID Theft and the Form 14039 and/or police report has been received, the levy should be released only for the tax modules affected by the ID Theft.

    • Follow IRM 5.19.4.4.10, Levy Release: General Information, for full and partial levy release procedures.

    Note:

    Consider a release of a levy based on prior indication of ID Theft TC 971 AC 501 or AC 506 on IDRS.

Addressing Outstanding Levies
  1. If there is a balance due not attributable to Identity Theft, collection activities, including the appropriate use of enforced collection action, are not prohibited when a taxpayer has established that he/she was a victim of Identity Theft.

    • Be sensitive to the adverse impact that being a victim of Identity Theft may have upon a taxpayer and his/her ability to pay.

    • Consider temporarily suspending the account until the Identity Theft incident is resolved in cases where you determine the Identity Theft will have an adverse impact on the taxpayer’s ability to pay.

  2. If the taxpayer claims financial hardship as a result of a tax-related Identity Theft issue:

    1. Prepare and submit Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order). If the taxpayer requests to contact Taxpayer Advocate Service directly, advise the taxpayer to call 1-877-777-4778 toll-free, or go to http://www.irs.gov/advocate/.

      Exception:

      If IRS can provide relief or take a substantive action towards providing relief within 24 hours, do not send the case to TAS, unless the taxpayer requests TAS assistance and the case meets TAS criteria

    2. If the taxpayer is an individual, refer to IRM 25.23.2.2, Taxpayer Interaction.

    3. If the ID Theft situation involves a business, refer to IRM 25.23.9.2, BMF Identity Theft Overview.

  3. Review the case history for outstanding enforcement activity that may need to be corrected, i.e., levies, liens.

  4. A levy attaching the assets of the victim in a mixed entity case must be immediately released. Refer to IRM 25.23.10.12.2.2(8), IDTVA-C ACSS Preliminary Research Needed for Determining Identity Theft on Cases Meeting ACS IDT Criteria for guidance on mixed entity cases.

  5. A levy attaching to assets of non-owner of the TIN for which:

    1. The Service assessed the liability in the name of the non-owner of the TIN,

    2. The Service issued all pre-levy notices properly to non-owner of the TIN,

    3. The Service assessed the liability under the TIN/SSN of the victim,

    4. The assessment is based solely on the income of the non-owner of the TIN, and

    5. There are no credits (payment offset, etc.) attributable to the victim for the assessment listed on the levy, may remain in effect unless a circumstance outlined in IRM 5.11.2.3.1, Legal Basis for Releasing Levies, is present. The assessment is not invalid for the sole reason that it was made under the victim's TIN/SSN.

    Note:

    If unable to determine if the liability of the non-owner of the TIN is satisfied then release the levy until the account can be adjusted to ensure the levy is not enforced on a satisfied liability.

    Reminder:

    To prevent re-issuance of levy, change levy source to "INFO ONLY" .

Addressing ACS Paper Levies
  1. When the taxpayer claims to be a victim of ID Theft and the Form 14039 and/or police report has been received, the levy should be released only for the tax modules affected by the ID Theft.

  2. Follow IRM 5.19.4.4.10, Levy Release: General Information, for full and partial levy release procedures.

    Note:

    Consider a release of a levy based on prior indication of ID Theft TC 971 AC 501 or AC 506 on IDRS.

Addressing Outstanding Federal Payment Levy Program (FPLP) Levies
  1. A thorough review of the account must be conducted to ensure that all tax years affected by tax related Identity Theft are blocked from the FPLP program.

  2. When a TC 971 AC 501 or AC 506 has not posted to the entity for tax administrative ID Theft, employees, must take steps to block outstanding FPLP levies.

    1. When a module has been selected for FPLP (unreversed TC 971 AC 060) it may be necessary to input a manual block. Refer to IRM 5.19.9.3.7 , FPLP Levy Release: General.

    2. When a FPLP account is matched with a Federal payment or FPLP account (unreversed TC 971 AC 062) and the disbursement of the Federal payment is imminent, an immediate FPLP release through the FPLP coordinator may be necessary, see IRM 5.19.9.3.7.1, Immediate Release Through the FPLP Coordinator.

  3. When a TC 971 AC 501 or AC 506 is posted, FPLP will automatically block the tax modules entered into the secondary date field. However, depending on when the TC 971 AC 501 or AC 506 was input, there may be a need for an immediate release where the disbursement of the Federal payment is imminent. Follow the procedures in IRM 5.19.9.3.7.1, Immediate Release Through the FPLP Coordinator.

    Caution:

    Do not manually block the case from levy if the assessment is not a result of the Identity Theft.

Identity Theft and Disposition of Levy Proceeds
  1. This section was developed to provide guidance for cases that involve ID Theft issues where the individual calling was levied and levy proceeds have been sent to the Service. The caller may be the owner or non-owner of the TIN. Ensure the levy has been released.

    Note:

    There may be instances that involve ID Theft issues when the non-owner of the TIN does not contact the Service regarding levy proceeds. In these instances, the non-owner levy proceeds should be moved off the owner of the TIN’s account. Move payments following current Erroneous Refund and/or Excess Collection procedures.

  2. The IRC distinguishes between "wrongful" levies and other types of improper or "erroneous" levies.

    1. A "wrongful" levy is one that improperly attaches property belonging to a third party in which the taxpayer has no rights. (See IRC 6343(b)) The Code specifically authorizes release of wrongful levies. See IRM 5.11.2.3.2.1, Wrongful Levy, for wrongful levy procedures.

    2. An "erroneous" levy is one that properly seeks to capture a taxpayer's property (rather than a third party's property), but nevertheless is served prematurely or otherwise in violation of an administrative procedure or law. (See IRC 6343(d).) See IRM 5.11.2.3.2.3, Erroneous Levies, for erroneous levy procedures.

      Note:

      Do not confuse this situation with one where the taxpayer (SSN owner) does not owe a liability. See IRM 25.23.10.12.2.6.7, Returning Proceeds from Wrongful Levy (Non-Owner).

Returning Levy Proceeds to ID Theft Victims (SSN Owner)
  1. These procedures address cases where the owner of the SSN claims the Service levied on property he or she has an interest in to satisfy the tax liability that does not belong to them.

  2. When the SSN owner is claiming a refund i.e. Levy proceeds, because of an assessment of liability not belonging to the taxpayer, the limitations for returning the payments falls under normal payment RSED procedures and time frames (2 years from the payment date).

    Note:

    A claim for refund can be a formal claim for refund or an informal claim for refund. Seek assistance from Counsel if you have questions.

  3. Under the following circumstances, the levy proceeds should be returned to the SSN owner:

    1. An ID thief (non-owner of the SSN) has filed a return in the taxpayer’s name.

    2. The SSN owner (taxpayer) did not have a filing obligation or at least didn’t file a return, which delayed discovery of the ID Theft.

    3. The ID Theft return either was audited or reviewed and there is an assessed balance on the victim (SSN owner) account that the IRS is attempting to collect (defaulted deficiency or summary assessment of overstated withholding).

    4. The IRS has used its levy authority to collect against the assessment.

    5. The IRS determines it should abate the assessments created as a result of the return filed by the non-owner of the SSN. The taxpayer’s account will have a zero liability and a credit balance equal to the amount of levy proceeds.

      Note:

      Because the assessment and levy were for the taxpayer/victim, rather than an assessment for a taxpayer and a levy on a third party, the 9 month wrongful levy statute does not apply.

Returning Proceeds from Wrongful Levy (Non-Owner)
  1. The non-owner of the TIN may file a wrongful levy claim for return of levy proceeds (from the assets of the non-owner of the TIN) already received and processed by the Service. See IRM 25.23.10.12.2.6.5, Identity Theft and Disposition of Levy Proceeds, for definition of "wrongful" levy.

  2. A "wrongful" levy claim may be appropriate when:

    1. The assessment is based solely on the SSN owner's income, since the levy improperly attaches to property belonging to a third party (the non-owner(s) of the TIN).

    2. The assessment is based on the combined income of the non-owner(s) of the TIN and the owner's, since the levy may have improperly attached to property belonging to a third party (the non-owner of the TIN).

    3. The assessment is based on the combined income of multiple non-owners, since the levy may have improperly attached to property belonging to the third parties.

  3. When speaking with the caller, secure information to determine that the individual requesting the return of levy proceeds is the non-owner of the SSN and not the owner of the original SSN. Verify the following:

    1. Name, address and SSN/ITIN.

    2. The levy issued was to a source belonging to the non-owner of the SSN based on the taxes assessed under the SSN of the rightful owner or assessed in the name of the victim based on the earnings of the non-owner of the SSN.

      Example:

      The non-owner proves use of the SSN via pay stubs or any other substantiating document and has rent/utility receipts where current name/address is the name/address on CC IRPTR print out and pay stubs show use of that SSN.

    3. The non-owner must provide substantiation to show ownership of the levy payments.

    4. Taxes were assessed on the account of the rightful owner of the SSN or assessed based on the earnings of the non-owner of the SSN.

    5. The true owner’s account (SSN) is being used by the owner and the non-owner (not merely by the non-owner to work).

    6. Written contact from non-owner must be within 9 months of the date of the levy and must be given to the appropriate office listed in Publication 4235, Collection Advisory Group Numbers and Addresses.

      Caution:

      A request for the return of property wrongfully levied is not effective if it is sent to the wrong office. Advise the caller to carefully read Publication 4235.

      Note:

      If IRS is contacted more than 9 months after the date of the levy, we have no authority to return the wrongful levy payments.

  4. See IRM 5.11.2.3.2.1, Wrongful Levies, for appropriate action. Contact Collection Advisory to determine if the non-owner of the TIN would qualify for wrongful levy claim consideration.

    1. Collection Advisory will evaluate a properly filed claim. If the claim is disallowed, Collection Advisory should notify the third party in writing of the reason for disallowing the claim and of the right to bring suit against the government. If the claim is disallowed because it was not made within nine months from the date of the levy, Collection Advisory should send Letter 3973, Wrongful Levy Claim Rejection Letter - Untimely Claim, via certified mail.

      Note:

      Disallowance of the claim may be appealed through the Collection Appeals Program (CAP).

    2. If the claim is disallowed for another reason, Collection Advisory should send the claimant Letter 3974, Wrongful Levy Claim Rejection Letter, via certified mail. Disallowance of the claim may be appealed through the Collection Appeals Program (CAP).

  5. If a levy is served where the Service:

    • Assessed the liability in the name of the non-owner of the SSN,

    • Issued all pre-levy notices properly to non-owner of the SSN,

    • Assessed the liability under the TIN of the SSN owner,

    • The assessment is based solely on the income of the non-owner, and

    • There are no credits (payment, offset, etc.) attributable to the SSN owner for the assessment listed on the levy, the levy may remain in effect unless there is an independent basis for releasing it. See IRM 5.11.2.3.1, Legal Basis for Releasing Levies . The assessment is not invalid for the sole reason that it was made under the victim's TIN/SSN.

    Reminder:

    To prevent re-issuance of levy, change levy source to "INFO ONLY".

Follow-up Actions on ID Theft Accounts Involving Wrongful Levy
  1. IRM 5.11.2.3.2.1, Wrongful Levy, and IRM 25.23.10.12.2.6, Levies, provides guidance for cases that involve ID Theft issues and wrongful levies.

Oscar "O" Inventory
  1. The "O" function has been designated for Identity Theft (IDT) cases in ACS.

    Note:

    The O1 Inventory is reserved for future use.

  2. Function inventories may be processed either by next case processing or from a list.

    1. In next case processing the ACS system brings each case up in priority sequence with an expired follow-up date.

    2. List(s) obtained through Query Management Facility (QMF) identifies accounts which may not have expired follow-up dates.

      Note:

      Either process is necessary to ensure proper follow-up actions are taken. This includes moving cases to the appropriate function.

    Caution:

    Review cases carefully when working from a list to avoid taking premature actions

O0 Inventory – Managerial/ACSS CIS Referrals
  1. O0 inventory contains ACS accounts awaiting managerial approval. This inventory must be functioned out weekly.

  2. ACSS CIS referrals received from V1 work. This inventory must be functioned out weekly.

O2 Inventory – IDTVA-C ACSS IDT Correspondence
  1. The O2 inventory is for IDTVA-C ACSS Correspondence cases received with the required Form 14039 and/or police report.

  2. This inventory will also include faxed IDT documents forwarded from the ACS Call-sites currently in the V1 inventory. The case should be batched on CIS to OFP 40231 (IMF) or OFP 10412 (BMF) and reassigned "TOO2,180,CORR".

  3. See IRM 25.23.10.12.2.8, Expired O Inventories, for guidance on processing the expired follow-ups.

O3 Inventory - IDTVA-C BMF
  1. See IRM 25.23.9, BMF Identity Theft Processing, for procedures.

O4 Inventory – IDTVA-C ASFR Referrals
  1. The O4 inventory is for cases not meeting IDTVA-C ACSS criteria that are referred to IDTVA-C ASFR due to an ASFR assessment that needs an IDT determination by that function.

  2. The cases are reassigned to the O4 inventory with a 180 day follow-up e.g., TOO4,180,IDTASFR.

  3. See IRM 25.23.10.12.2.8.1.2, Processing Expired 04-07 Inventory & O9 Inventory, for additional information on cases meeting this criteria.

O5 Inventory – IDTVA-C AUR Referrals
  1. The O5 inventory is for cases not meeting IDTVA-C ACSS criteria that are referred to IDTVA-C AUR due to an AUR assessment that needs an IDT determination by that function.

  2. The cases are reassigned to the O5 inventory with a 180 day follow-up e.g., TOO5,180,IDTAUR.

  3. See IRM 25.23.10.12.2.8.1.2, Processing Expired 04-07 Inventory & O9 Inventory, for additional information on cases meeting this criteria.

O6 Inventory – Other Functional Referrals
  1. The O6 inventory is for cases not meeting IDTVA-C ACSS criteria that are referred to another functional area (other than IDTVA-C ASFR, SFR, AUR, or Exam) to make the IDT determination (e.g., RPM, CAWR, FUTA, FRIV, AM, CIB, etc.).

  2. The cases are reassigned to the O6 inventory with a 180 day follow-up (e.g., TOO6,180,IDTxxxx - "xxxx" = the function or operation the case was referred to such as RPM, CAWR, FUTA, FRIV, AM, CIB, etc.).

  3. See IRM 25.23.10.12.2.8.1.2, Processing Expired 04-07 Inventory & O9 Inventory, for additional information on cases meeting this criteria.

O7 Inventory – IDTVA-C Examination Referrals
  1. The O7 inventory is for cases not meeting IDTVA-C ACSS criteria that are referred to IDTVA-C Exam due to an Exam assessment that needs an IDT determination by that function.

  2. The cases are reassigned to the O7 inventory with a 180 day follow-up e.g., TOO7,180,IDTEXAM.

  3. See IRM 25.23.10.12.2.8.1.2, Processing Expired 04-07 Inventory & O9 Inventory, for additional information on cases meeting this criteria.

O8 Inventory – Referrals to Designated Identity Theft Adjustment (DITA)
  1. If an IRSN is required to resolve the case, refer to DITA. Reassign to the O8 inventory with a 180 day follow up e.g.,TOO8,180,DITA.

O9 Inventory - Referrals From ACS Compliance
  1. O9 inventory is for cases referred from ACS Compliance. Cases include but are not limited to H7, V1, cases identified with CIS images.

  2. The cases are reassigned to O9 with a 1 day follow up e.g. TOO9,01,XXXX.

  3. See IRM 25.23.10.12.2.8.1.2, Processing Expired O4-O7 & O9 Inventory, for additional information on cases meeting this criteria.

Expired O Inventories
  1. This section addresses expired O inventories.

General Guidelines
  1. If research indicates no Identity Theft involvement and/or the case may have been erroneously reassigned to an O Inventory, update to the appropriate ACS function for next case action.

  2. Document CIS. It is imperative/critical that thorough documentation is completed on these cases. Please be sure to include dates of all contacts with other functional areas, as well as documenting the discussion(s), any actions and/or resolutions taken on the account and future next case actions.

  3. Use OFP 40237 when taking next case actions or working O inventory listings. Count each entity processed.

Processing Expired O2/O3 Inventory
  1. If the substantiation relating to an original/subsequent return filing (ACS criteria) or return delinquency has been received but the issues have not been resolved, proceed with the actions in the following If/And/Then table:

    If And Then
    1) the substantiation relating to an original/subsequent return filing (ACS criteria) or return delinquency has been received but the issues have not been resolved there is an open control base to an IDTVA-C ACSS employee only extend the follow-up date an additional 60 days, "OADT,60,FLWUP".
    2) the substantiation relating to an original/subsequent return filing (ACS criteria) or return delinquency has been received but the issues have not been resolved there is an open control base to the ACS Suspense wall extend the follow-up date an additional 180 days, "OADT,180,FLWUP".
    3) the substantiation relating to an original/subsequent return filing (ACS criteria) or return delinquency has been received but the issues have not been resolved there are multiple control bases open to an IDTVA-C ACSS employee in "M" status and a Designated Identity Theft Adjustment (DITA) employee the case will be reassigned to the O8 inventory with a 90 day follow-up using the appropriate literal "DITA".
  2. If there is indication the case has been resolved (e.g., TC 971 AC 501/506), proceed with the actions in the following If/And/Then table :

    If And Then
    1) there is indication the case has been resolved (e.g., TC 971 AC 501/506) a balance due remains take the next appropriate action (see IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues) and move the case to the next appropriate ACS function (e.g., "TOXX,30,IDTFIXD").
    2) there is indication the case has been resolved (e.g., TC 971 AC 501/506) there is a return delinquency with a filing requirement still open take the next appropriate action (see IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues and move the case to the next appropriate ACS function.
    3) there is indication the case has been resolved (e.g., TC 971 AC 501/506) there is a return delinquency and the filing requirements are closed follow guidelines as outlined in IRM 5.19.2.5, Return Delinquency Research, for closing action.
    4) there is indication the case has been resolved (e.g., TC 971 AC 501/506) there is no balance due or return delinquency update the ACS follow-up date with "OADT,30,IDTFIXD".
  3. Document CIS. It is imperative/critical that thorough documentation is completed on these cases. Please be sure to include dates of all contacts with other functional areas and to document the discussion(s), any actions, and/or resolutions taken on the account including future next case actions.

Processing Expired O4-O7 & O9 Inventory
  1. If there is an unreversed TC971 AC 522 PNDCLM and no CIS documents then reverse TC 971 AC 522 with TC 972 AC 522 NORPLY and return to ACSS Compliance per IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection issues. If there is an Identity Theft associated TC 470, reverse it with TC 472.

  2. If there is a TC 971 AC 522 IRSID and you are unable to identify the ID Theft and there are no documents or narratives then reverse TC 971 AC 522 with TC 972 AC 522 IRSERR and return to ACSS Compliance per IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. If you are able to identify ID Theft then create a CIS case with the appropriate category code using the corporate holding number, using the current date and leave a case note on CIS/AMS. Update the priority code to 1.

  3. If TC 971 AC 522 is posted with the literal MISC<PPDSOPIP and there is no Form 14039 return to ACSS Compliance per IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues.

  4. If the case is an IRSN with a Service Center Address send to H9.

  5. If the IDT claim is determined invalid but there are allegations of return preparer misconduct, provide information on filing a claim (Form 14157, Return Preparer Complaint or Form 14157-A, Tax Return Preparer Fraud or Misconduct Affidavit) and required documents when sending the IDT determination letter. If a TC 971 AC 522 is present reverse it with TC 972 with tax administration source OTHER. If there is an Identity Theft associated TC 470, reverse it with TC 472. Return to ACSS Compliance per IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection issues.

  6. If research indicates a TC 971 AC 504 or 505 or 525 is posted, verify no other IDT TC 971 (5XX) action codes posted to IDRS. These TC 971’s usually do not have IDT involvement and the case can continue, follow IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. Document AMS with the research and actions taken. If there is an Identity Theft associated TC 470, reverse it with TC 472. If other TC 971 IDT (5XX) action codes posted to IDRS be sure to indicate the IDT issue has been resolved and closed with the applicable TC 971 AC 501 or TC 971 AC 506. If research shows TC 971 AC 524 and there is no indication of identity theft reassign ACS case TOR4,01,NOIDT. If there is a liable spouse continue with IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. Document AMS with the research and actions taken. If there is an Identity Theft associated TC 470, reverse it with TC 472. If research indicates IDT, process as normal.

    Note:

    Deceased Taxpayers: If research shows TC 971 AC 524 check for any unusual activities after taxpayer’s date of death (For example filed tax returns, SFR & Exam assessments etc.). If needed seek guidance from unit lead or manager. If research show IDT issues have been resolved, reassign ACS case TOR4,01,IDTFIXD. If there is a liable spouse continue with IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. Document AMS with the research and actions taken. If there is an Identity Theft associated TC 470, reverse it with TC 472.

  7. If there is an open IDT control to another function, move the ACS case to the correct Oscar inventory and extend with a 180 day follow-up by assigning the ACS case TOXX,180,FLWUP. Input TC 971 AC 522 UNWORK on TP identified cases (Do Not input UNWORK on IRSID cases) if it is not already on the account. Update CIS/AMS history accordingly. If the age from IRS received date is more than 180 days update the priority code to 1. Input a TC 470, block FPLP, release levies if applicable. If the 180 day follow-up has expired with no action taken, e-mail the function’s IDT Liaison indicating the following information: Date of initial referral and reason why initially referred i.e. TC 922/290, TC 300, TC 150 SFR/ASFR assessed, TC 290 BS 55, etc. Update the activity code to OSINV (Oscar Inventory) and update the priority code to 1. Update ACS case OADT,30,FLWUP.

  8. If there is no open IDT control to another function and research indicates a TC 971 with AC 522 UNWORK has not been reversed and CIS/AIMS narratives indicate the IDT documents were forwarded to another function for their determination, create a CIS case using priority code 1, linking Form 14039 if available on CIS with the appropriate category code, using the corporate holding number. Use the Form 14039 received date if available which corresponds to the tax year in question, otherwise use current date. Update the activity code to OSINV. Input TC 971 AC 522 UNWORK if it is not already on the account. Input a TC 470, block FPLP, release levies if applicable. Document case notes on CIS/AMS.

    Note:

    CIS must be documented with the action taken and that the time frame was extended for 90 days. Be sure to input “TOXX,90,IDTxxxx” on ACS (xxxx = AUR, Exam, SFR, ASFR, CAWR, RPM, FUTA, FRIV, AM, CIB etc.).

  9. If there is indication all the IDT issues have been resolved (e.g., TC 971 AC 501 or 506) or closed as “NOIDT”, proceed with the actions in the following If/And/Then table :

    Note:

    Be sure to indicate the IDT issue has been resolved with the applicable TC 971 AC 50x. (x = 501 or 506). If TC 971 AC 50x is not present and determination is made that IDT is resolved input applicable TC 971 AC 50X. If there is an Identity Theft associated TC 470 reverse it with TC 472.

    1. If And Then
      1) there is indication all the IDT issues have been resolved (e.g., TC 971 AC 501 or 506) or closed as “NOIDT” a balance due remains See IRM 25.23.10.12.2.5 ,Next Case Actions, Remaining Collection Issues Input on ACSWeb "TOXX,30,IDTFIXD”, “TOXX,30,NOIDT".
      2) there is indication all the IDT issues have been resolved (e.g., TC 971 AC 501 or 506) or closed as “NOIDT” an LT16 has been previously issued See IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. Input on ACSWeb, TOXX,01,IDTFIXD or TOXX,01,NOIDT.
      3) there is indication all the IDT issues have been resolved (e.g., TC 971 AC 501 or 506) or closed as “NOIDT” there is a return delinquency with a true filing requirement reassign to CN (phone number present) or I2 (no phone number). See IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. Input on ACSWeb (e.g., "TOXX,30,IDTFIXD", “TOXX,30,NOIDT”).
      4) there is indication all the IDT issues have been resolved (e.g., TC 971 AC 501 or 506) or closed as “NOIDT” there is an open TDI and the taxpayer does not have a filing requirement Refer to the following IRMs for appropriate TDI closing actions:
      See IRM 25.23.2.18.5, Closing Identity Theft Cases with Tax Delinquency Inquiries (TDI), when the TDI was created by fraudulent income and the taxpayer does not have a filing requirement. Input TC 590 AC 020 using CC FRM49. See IRM 5.19.2.6.4.6, IMF - Determining Liability, , for other TDI closing actions.
      5) there is indication all the IDT issues have been resolved (e.g., TC 971 AC 501 or 506) or closed as “NOIDT” the account is still on ACS but there is no longer a balance due or a return delinquency or if penalties and interest will be eliminated once the adjustment posts update the ACS follow-up date with "OADT,30,IDTFIXD". This will allow time for the account to fall off ACS.
  10. If the IDT issue has not been resolved and there is no indication a referral was sent/received in the appropriate IDTVA-C (Compliance function), and the case is not open/active on CIS, create a CIS case using priority code 1, linking Form 14039 if available on CIS with the appropriate category code, using the corporate holding number. Use the Form 14039 received date if available which corresponds to the tax year in question, otherwise use current date. Update the activity code to OSINV. Input TC 971 AC 522 UNWORK if it is not already on the account. Document case notes on CIS/AMS. Reassign ACS case to the appropriate ACS function. Update ACS with a 90 day follow-up e.g.,TOXX,90,IDTxxxx (xxxx = AUR, Exam, SFR, ASFR, CAWR, RPM, FUTA, FRIV, AM, CIB etc.). Input a TC 470, block FPLP, release levies if applicable.

    Note:

    An acknowledgement letter is NOT required if the IRS received date is more than 180 days old when creating a case working the O9 inventory.

  11. If a case was worked in IDT and all actions were not taken correctly, i.e. unresolved credit, unpostable, lost refund, credit transfer etc, take action to correct the case if possible and follow procedures in IRM 25.23.4.5.1.1(4),CIS Case Controls. Do not create a case.

  12. If ACSS cannot resolve case, create a CIS case using priority code 1, linking Form 14039 if available on CIS with the appropriate category code, using the corporate holding number. Use the Form 14039 received date if available which corresponds to the tax year in question, otherwise use current date. Update the activity code to OSINV. Input TC 971 AC 522 UNWORK if it is not already on the account. Document case notes on CIS/AMS. Update case with 30 day follow-up on ACS e.g., TOXX,30,IDTxxxx (xxxx = AUR, Exam, SFR, ASFR, CAWR, RPM, FUTA, FRIV, AM, CIB etc.). Input a TC 470, block FPLP, release levies if applicable.

    Note:

    CIS/AMS must be documented with the action taken and that the time frame was extended for 30 days. Be sure to input “TOXX,30,IDTxxxx” on ACS (xxxx = AUR, Exam, SFR, ASFR, CAWR, RPM, FUTA, FRIV, AM, CIB etc.).

    Note:

    An acknowledgement letter should NOT be issued.

  13. If the case meets multiple function criteria and there is no indication a referral was sent, follow procedures in IRM 25.23.4.7.1, IDTVA Work Types. If the case is not open/active on CIS, create a CIS case using priority code 1, linking Form 14039 if available on CIS with the appropriate category code, using the corporate holding number. Use the Form 14039 received date if available which corresponds to the tax year in question, otherwise use current date. Update the activity code to OSINV. Input TC 971 AC 522 UNWORK if it is not already on the account. Document case notes on CIS/AMS. Reassign case to appropriate ACS function. Update ACS with a 90 day follow up e.g., TOXX,90,IDTxxxx (xxxx = AUR, Exam, SFR, ASFR, CAWR, RPM, FUTA, FRIV, AM, CIB etc.). Input a TC 470, block FPLP, release levies if applicable.

    Note:

    An acknowledgement letter is NOT required if the IRS received date is more than 180 days old when creating a case working the O9 inventory.

  14. If research indicates a TC 972 with AC 522, 523, 524, or 525 posted, this indicates no IDT issue or no IDT claim was received or no response to a request for additional information/documents. Follow IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection Issues. Document CIS/AMS with the research and actions taken. Be sure to indicate no IDT issue or IDT claim was received or no response received- TC 972 AC 52x posted (x = 522, 523, 524, or 525). If there is an Identity Theft associated TC 470 reverse it with TC 472.

  15. Document CIS/AMS. It is critical that thorough documentation is completed on these cases. Please be sure to include dates of all contacts with other functional areas and to document the discussion(s), any actions, and/or resolutions taken on the account including future next case actions.

Processing Identity Theft/Return Preparer Misconduct (RPM) Collection Alert Forms (Form 14394) - Notification of Balance Due IDT Case
  1. Form 14394, Identity Theft/RPM Case Collection Alert Instructions will be received from other IDT Functions. The form must be completed within ten business days of receipt. Results of any action taken should be documented.

  2. The account will be reviewed based on the boxes checked for potential collection activity. If the conditions are found, those actions should be released or withdrawn to ensure no further harm to the taxpayer.

  3. All Form 14394 received and processed must be recorded in the weekly IDT Report.

  4. Forms may be destroyed after 90 days.

Processing Identity Theft/RPM Collection Alert Forms (Form 14394) – Actions Taken Balance Due Still Identified
  1. Form 14394, Identity Theft/RPM Case Collection Alert Instructions will also be returned when a different function has completed resolution of the IDT issues and there is still a balance due condition involved

  2. Review the account to ensure that closing actions of the IDT issue have been completed.

  3. Cases should be updated to the next appropriate function based on IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection issues, CIS should be documented with "IDT issue resolved, to ACS XX for next case action" .

Back-End Process on Referrals Returned From Designated Identity Theft Adjustment (DITA)
  1. If applicable, send the completed Form 9409, IRS/SSA Wages Worksheet, to SSA. The form(s) should already be completed and found in the file copy of the case. Document CIS that Form 9409 has been sent to SSA.

  2. For cases remaining on ACS (balance due and/or delinquent return(s) required) and the applicable TC 971 (AC 501/506) has been input, take the following actions:

    1. Review all levy sources and delete any that do not belong to the taxpayer.

    2. Follow IRM 25.23.10.12.2.5, Next Case Actions, Remaining Collection issues. - IDT Resolved Remaining Collection Issues, for balance due accounts (includes combo accounts) and for delinquent return accounts.

  3. Close the monitoring IDRS control bases.

  4. Update CIS with all actions taken (deleted levy source information, telephone contact attempt/made, ACS actions, etc.).

  5. Report time and volume under OFP 40231.

  6. File copy should be destroyed as classified waste.

IDTVA - C AUR Identity Theft Case Processing

  1. This IRM section provides specific guidance for Identity Theft Victim Assistance (IDTVA) cases involving Automated Underreporter (AUR) issues. Guidance dealing with non IDTVA AUR issues can be found in the IRM 4.19.3, IMF Automated Underreporter Program.

IDTVA -C AUR IDTVA Clerical Procedures
  1. Identity theft correspondence will be received through the AUR clerical units. AUR cases will then be referred to the IDTVA unit by the AUR IDT Coordinator.

  2. In most instances, IDTVA will only accept cases (Open or Recon) from AUR that have a Form 14039, Identity Theft Affidavit or police report included with the correspondence. See IRM 25.23.4.4.1, IDTVA-C - Case Referrals from Compliance Functions, for guidance on acceptable case referrals.

  3. If cases are referred by AUR to IDTVA not fitting the criteria listed in IRM 25.23.4.4.1, IDTVA-C - Case Referrals from Compliance Functions an IDTVA designated individual will reject the case back to the referring AUR IDT Coordinator or referring function. The contact for each AUR site can be found using the link below.

    Exception:

    Ogden AUR IDT cases will be sent to the Philadelphia IDTVA AUR Team. Sites will return cases originating from Ogden AUR back to the Ogden AUR Coordinator.

    AUR IDT Coordinator Listing (ITVA Use Only)

  4. Research all referrals from AUR on the AUR system to ensure that a PC "SI" was input. If the last PC code entered on the AUR system is not PC "SI" , notify the appropriate AUR IDTVA coordinator to have the process code input.

    Note:

    RPM cases should also be referred to IDTVA with a PC "SI" input.

  5. All correspondence received from AUR must be controlled on CIS. Refer to IRM 25.23.10.2, Case Batching for instructions to ensure correspondence is properly controlled.

  6. After tax examiners have completed all case actions, open cases will be given to a designated individual who will notify the appropriate AUR site of the closure. For open cases, notification will be in the form of a Form 3210, Document Transmittal listing all SSNs and tax year(s) that are being returned. Return the Form 3210 to the appropriate AUR IDT Coordinator as indicated in (3) above.

  7. See IRM 25.23.10.12.3.2.1, Technical - Initial Handling Procedures, for additional initial action requirements.

Technical Procedures
  1. This section provides general guidance to IDTVA Tax Examiners who work IDT cases with AUR involvement. These procedures are standard for all cases.

Technical - Initial Handling Procedures
  1. Initial review of the taxpayer response is necessary to ensure a valid identity theft claim was submitted. If the taxpayer response does not indicate a claim of identity theft or dispute of the posted return, take the appropriate action to return the case to normal processing. See IRM 25.23.4.4.1, IDTVA - C - Case Referrals from Compliance Functions for further instruction.

    Note:

    All IDT cases, both Open and Recon, require a control base to be opened on all tax year accounts (modules) impacted by identity theft. See IRM 25.23.4.5.1.1, CIS Case Controls for additional information.

    Note:

    All modules should be opened with a Category Code IDI2, even if that year does not contain an AUR issue.

  2. When cases are assigned, verify that any open AUR case has a process code "SI" input on the AUR system. If a process code "SI" is not present on the AUR system, have the IDTVA Liaison contact the AUR IDT Coordinator to ensure that a process code "SI" is input on the case.

    Reminder:

    If an open AUR case requires referral to IDTVA - Exam, ensure the CIS case data is updated following the guidance in IRM 25.23.4-6, IDTVA Routing Matrix.

  3. IDTVA AUR is allowed up to 120 days from the date the PC "SI" was input to return open cases back to AUR. If the case cannot be resolved within 120 days, the IDTVA Functional Liaison will contact the AUR IDT Liaison to request up to an additional 40 days. If within 160 days the case has not been completed, AUR will close the case with a PC 17. Document the request for additional time in a CIS case note.

    Note:

    On cases that Philadelphia receives from Ogden AUR, the 120 days will start 5 days after the PC "SI" was input to allow for the transshipment of the cases.

    Note:

    If the IDTVA AUR team does not receive the case within two business days of the PC "SI" being input, document in a case note the date the case was actually received. The 120 day time frame will begin on the date the case was actually received.

    Caution:

    AUR will close the case if they are not contacted before the 120 day time frame has expired.

  4. IDTVA-I and IDTVA - A will send referrals to IDTVA-C functions directly rather than through their compliance counterparts. If a referral is received on an open AUR case that is not currently assigned to IDTVA inventory, the IDTVA Liaison should contact the AUR IDT Coordinator to ensure that a process code "SI" is input on the case.

  5. In addition, the category code must be updated with the appropriate IDI category code following the instructions in, IRM 25.23.10.2, Case Batching.

  6. Refer to IRM 25.23.2.16, Initial Allegation or Suspicion of Tax-Related Identity Theft – IMF Identity Theft Indicators to determine if a TC 971 AC 522 is required to be input.

  7. In order to ensure the taxpayer is not harmed by collection actions, see IRM 25.23.4.7.6, Collection Activity - Form 14394/13794 for further instructions on the suspending of enforcement actions.

  8. An acknowledgement or determination letter must be issued within 30 days of receipt into the function if one has not been issued previously. Follow the instructions in IRM 25.23.10.3, Letter Procedures to send an acknowledgement letter. Upon receiving cases in inventory the time remaining in the initial acknowledgement letter should be verified and interim letter issued if applicable.

Document Requirements for Cases with AUR Involvement
  1. To determine when additional documentation is needed to support an ID Theft claim, see IRM 25.23.2.17.1, When to Request Additional Information to Support an Allegation of Identity Theft.

  2. Identity theft claims made on cases that have AUR involvement have an additional document requirement. On cases with AUR involvement the taxpayer must also identify in a statement which AUR issues they are disagreeing with. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Example:

    AUR issues a CP2000 notice to our ID Theft victim. The notice contains underreported WAGES Issues: WAGES IR A, WAGES IR B, WAGES IR C and WAGES IR D. Taxpayer submits a statement that he disagrees with WAGES IRs A and B and makes no comment regarding WAGES IRs C and D. Create an AUR case note. Instruct AUR to remove the IRs the taxpayer is disputing and to continue processing the case. See IRM 25.23.10.12.3.3(3), Closing Procedures for additional information.

  3. Use the following table to determine when additional information must be requested from the taxpayer.

    IF AND THEN
    1) There is a single AUR issue Do not request the statement.
    2) The taxpayer does not submit the statement indicating which AUR issues are a result of identity theft. A determination can be made that the IRs do not belong to the taxpayer, based on:
    • Research of internal resources.

    • Geographical location.

    Request any required information from the taxpayer that is still needed, following the instructions in IRM 25.23.10.4, Corresponding with the Taxpayer.

    Reminder:

    The team’s EE-fax number should be provided to the taxpayer.

    3) The taxpayer does not submit the statement indicating which AUR issues are a result of identity theft. A determination can be made IRs do not belong to the taxpayer, based on:
    • Research of internal resources.

    • Geographical location.

    Do not request additional documentation. Continue processing the case.
Income Related Identity Theft
  1. If the taxpayer's response indicates they filed the TC 150 return and indicates that some or all of the AUR issue(s) are the result of identity theft, follow the table below:

    Reminder:

    If Married Filing Joint and both taxpayers are victims, both taxpayers must make an ID theft claim.

    IF AND THEN
    1) There is a single AUR issue,
    • Open cases - Input a TC 290 .00 with RC 139. Leave a case note advising AUR to remove the issue and close the case.

    • Recon cases - Abate the AUR assessment and penalties, as applicable.

    • Refer to IRM 25.23.10.12.3.3, Closing Procedures for instructions on required closing actions.

    2) There are multiple AUR issues The taxpayer has indicated they disagree with all of the AUR issues.
    • Open cases - Input a TC 290 .00 with RC 139. Leave a case note advising AUR to remove the issues associated with the impacted taxpayer. If there are no remaining issues, advise AUR to close the case or if there are remaining issues, advise AUR to remove the IRs the taxpayer is disputing and to continue processing the case.

    • Recon cases - Abate the tax and any applicable penalties, associated with the income being removed.

    • Refer to IRM 25.23.10.12.3.3 ,Closing Procedures for instructions on required closing actions.

    3) There are multiple AUR issues The taxpayer indicates that they disagree with some of the AUR issues
    • Open cases - Input a TC 290 .00 with RC 139. Leave a case note advising AUR to remove the issues that the taxpayer disagrees with. Advise AUR to remove the IRs the taxpayer is disputing and to continue processing the case.

    • Recon cases - Abate the tax and any applicable penalties, associated with the income being removed.

    • Refer to IRM 25.23.10.12.3.3, Closing Procedures for instructions on required closing actions.

    4) All underreported information returns are TIN Perfected

    Note:

    If the IR is TIN perfected, an asterisk will appear in the "TIN PERFECTION IND" field of the Information Return window. An asterisk will also appear in the "TP" field on the Case Analysis screen.

    • Open cases - Input a TC 290 .00 with RC 139. Leave a case note advising AUR to remove the issue and close the case.

    • Recon cases - Abate the AUR assessment and penalties, as applicable.

    • Input a TC 972 AC 522 NOIDT, if a TC 971 AC 522 PNDCLM or UNWORK is present

    • Send the taxpayer a Letter 4674C. Include a special paragraph informing the taxpayer that the unreported issue was due to an Internal Revenue Service error and that they were not a victim of Identity Theft, (or similar verbiage).

      Exception:

      Do not include the special paragraph, if there are other tax years determined to be impacted by identity theft.

  2. If the taxpayer responds and only disagrees with the amount of the underreported income, the case will be consider No IDT. Refer to IRM 25.23.2.16.4.2, Invalid Identity Theft Determinations – TC 972 AC 522 NOIDT and take one of the following steps below:

    • Open cases - Close the CIS case and return the AUR case to the referring AUR function.

    • Recon cases - Abate the tax associated with the income being removed.

Refund Related Identity Theft
  1. When correcting AUR tax assessments made on accounts subsequently determined to involve identity theft (employment or a fraudulent tax return), reverse any overpayment previously offset and release the refund from the originating tax period, when the return creating that refund was received prior to the expiration of the RSED. Adjust the transactions posted on the module to reflect the identity theft victim's tax return as allowable including all line items (such as tax, AGI, TXI, W/H, and credits). For more information see IRM 25.23.4.7.3.2, IDTVA - Additional Research and Actions Required.

    Caution:

    Normal Statute procedures apply when transferring payments. See IRM 25.6.1.10.2.7, Claims for Credit or Refund - General Time Period for Submitting a Claim.

    Caution:

    When applicable follow IRM 21.5.4, General Math Error Procedures, for applying Math Errors and Unallowable procedures when posting the legitimate taxpayer’s return. Also, when applicable see IRM 21.5.3.4.6, No Consideration and Disallowance of Claims and Amended Returns.

  2. If the response indicates the taxpayer did not file a tax return, regardless of agreement to AUR issues, issue a Letter 5064C advising the taxpayer to submit a completed return including the required signatures or a statement that they did not have a filing requirement with a copy of our letter. Request any other required documentation as applicable and/or a statement addressing each AUR issue. Suspend the case for 40 days to allow the taxpayer time to respond.

    Exception:

    Do not request a new return for any year prior to tax year 2011.

    Exception:

    Do not issue the Letter 5064C when ENMOD has an unreversed AC 501 for the tax module with the Tax Administration Source code of NOFR or a determination was made that the taxpayer has no filing requirement (i.e.; taxpayer is entitled to a refund; return would result in little or no tax due). See IRM 25.23.4.12.10.1, Determining Tax Liability for more information.

  3. If the taxpayer does not respond to the request for a return or the response does not include a good return, then follow the instructions below.

    • Nullify any return that has posted to the account or if the income is verifiable, send the case to DITA to have the return moved to an IRSN.

    • Recon cases, abate the AUR assessment. Open cases, notify AUR to close the case no change.

    • Prepare Form 2209, Courtesy Investigation, as instructed by IRM 25.23.4.12.10, Form 2209 Instructions.

      Reminder:

      If the taxpayer has no filing requirement, do not prepare Form 2209.

    • Issue a Letter 4674C as a closure letter and include a paragraph reminding the taxpayer of their obligation to file a federal tax return.

      Exception:

      Do not include the paragraph regarding their obligation to file, if the taxpayer does not have a filing requirement.

    • After all actions required in IRM 25.23.10.12.3.3, Closing Procedures have been completed, close the CIS case.

  4. If the taxpayer submits a signed statement that they did not have a filing requirement, refer to the instructions in IRM 25.23.4.7.3, Required Research for Mixed Entity and IDT Cases to determine if the posted return(s) need to be nullified or moved to an IRSN.

  5. When the taxpayer submits a return and has not submitted a statement addressing which AUR issues they disagree with:

    IF AND THEN
    1) There are AUR issues not included on the submitted return ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    • Document the outcall on CIS.

    • Open cases - Notate in a case note on the AUR system for AUR to close the case.

    • Process the taxpayer’s return following the instructions in IRM 25.23.10.7, Unprocessed/Secured Returns - General.

    2) There are AUR issues not included on the submitted return ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Through an outcall the taxpayer agrees to some of the remaining issues. Follow the instructions in (6) below, for the handling of the unprocessed return. When the Unprocessed Return procedures have been satisfied then:
    • Open cases - Notate in a case note whether or not the original return was determined to be the result of IDT and if a new return was processed. The case note should also contain information regarding which IR(s) do not belong to the taxpayer.

      Note:

      If the TC 150 was determined to be good, do not return the case to AUR until after the adjustment for the processing of the return has posted.

    • Recon Cases - Nullify any returns determined to be fraudulent. Abate the portion of income and tax the taxpayer is disagreeing with or is included on the return from the AUR assessment including any applicable penalties. Process the return the taxpayer submitted, following the instructions is (6) below..


    Follow any other IDT procedures applicable, to resolve the taxpayer’s account of any IDT issues.
    3) There are AUR issues not included on the submitted return ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ You are unable to contact the taxpayer regarding the AUR issues not included on the submitted return Follow the instructions in (6) below. Once the Unprocessed Return instructions are complete, follow these additional steps below
    • Open cases - Notate in a case note if the original return was determined to be fraudulent and that a new return was processed. Also, inform AUR which IRs were not included on the new return.

      Note:

      If the TC 150 was determined to be good, do not return the case to AUR until after the adjustment for the processing of the return has posted.

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


    Follow any other IDT procedures applicable, to resolve the taxpayer’s account of any IDT issues.
    4) Some of the AUR issues are included on the return, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    • Open cases - Notate in a case note on the AUR system for AUR to close the case.

    • Process the taxpayer’s return, following the instructions in (6) below.

    5) All of the AUR issues are included on the return,
    • Open cases - Notate in a case note on the AUR system for AUR to close the case.

    • Process the taxpayer’s return, following the instructions in (6) below.

  6. If the taxpayer has submitted a return with their response, process it as filed following these instructions.

    • Follow the procedures in IRM 25.23.10.7, Unprocessed/Secured Returns - General, to process the taxpayer’s good return.

      Reminder:

      Ensure the account ASED is adjusted to reflect the appropriate date based on the new valid return.

    • If the posted return needs to be moved to an IRSN account, refer the case to DITA using the instructions in IRM 25.23.10.11, Post Function Referral Procedures.

      Reminder:

      Ensure the TC 976 has posted to the account before making the DITA referral.

Closing Procedures
  1. In addition to the procedures outlined in this section, tax examiners are also responsible for any closing actions that may be contained in IRM 25.23.2, Identity Protection and Victim Assistance - General Case Processing and IRM 25.23.4.12.6, Actions Required on Streamline and Non-Streamline Case Processing. These IRMs contain guidance on information such as: (this list is not all inclusive)

    • IRM 25.23.2.11.1, Documentation of Actions

    • IRM 25.23.2.18, Closing Identity Theft Issues

    • IRM 25.23.4.12.7, Form 9409 Procedures - IRS/SSA Wages Worksheet

    • IRM 25.23.4.7.6.3, Collection Activity - Resume Collection Actions

  2. Before taking action on an account, research must be completed to review the pending and posted transactions, status, and controls on Master File. All impacted modules must be reviewed including modules associated with the account by credit transfers and refund offsets. All information must be considered to resolve the case thoroughly and accurately.

  3. When all account actions have been finalized, open AUR cases will need to be referred back to AUR. Information regarding the determination must be communicated to the AUR function via the AUR system. This will be accomplished via AUR Case Notes. In addition to the requirements in IRM 25.23.2.11.1, Documentation of Actions, case notes should include:

    • Information regarding which Information Returns to delete, if any

    • What follow up action is required (i.e. Continue Processing, or Case Closure)

      Caution:

      Provide AUR with general guidance on how to process the IDT issue. AUR’s instructions are subject to change; therefore avoid using specific AUR directions, such as which process code to use.

    Note:

    Whenever possible, use the standardized case notes on the AUR system to aid communication between AUR and IDTVA. Edit them to add information as needed. A list of the standardized case notes available to be used by IDTVA can be found in Exhibit 25.23.10-2, AUR Standardized Case Notes for IDTVA (AUR Open Cases Only).

  4. After all case actions have been completed, return the case to a designated individual who will notify AUR of the closure. add link

  5. Do not return AUR Recon cases to AUR.

  6. If during the processing of the case, AUR updated the open AUR tax year with a closure process code (i.e.; PC 17), do not send the case back to AUR.

IDTVA - C AUR Functional Liaison Responsibilities
  1. Guidance for the roles and responsibilities of an IDTVA Functional and/or ITAR liaison can be found in IRM 25.23.2.13, Identity Theft Liaison Responsibilities and IRM 25.23.2.14, Function Employee Responsibilities for Identity Theft Assistance Requests (ITAR) and Global Review (GRVW) Referrals

  2. In addition an IDTVA AUR functional liaison, is responsible for:

    1. Releasing IDTVA cases, both Open and Recon, to other functional areas when requested.

    2. Coordinating actions when there are open AUR cases in more than one Campus.

    3. Communicating with the AUR IDT Coordinator regarding any necessary case information or actions. This includes contacting them regarding the input of a PC "SI" , when required on AUR open cases.

    4. Contacting the AUR IDT Liaison to request up to an additional 40 days to complete the IDT Review on AUR open cases.

    5. Facilitating the transfer of cases between IDTVA and AUR.

    6. After tax examiners have completed all case actions, open cases will be given to a designated individual who will notify the appropriate AUR site of the closure. For open cases, notification will be in the form of a Form 3210, Document Transmittal listing all SSNs and tax year(s) that are being returned. Return the Form 3210 to the appropriate AUR IDT Coordinator.

IDTVA - C Exam Identity Theft Case Processing

  1. This IRM provides specific guidance for IDTVA cases involving Examination (both Campus and Field) or Tax Equity and Fiscal Responsibility Act (TEFRA) issues. Guidance dealing with non-IDTVA-Exam issues can be found in IRM 4.19, Liability Determination, and IRM 4.31, Pass-through Entity Handbook.

  2. IDT allegations received on TEFRA cases will be processed at the IDTVA-Exam Brookhaven site. All TEFRA cases will remain open on AIMS while referred to IDTVA for the IDT determination and account resolution. TEFRA cases are open in PBCs 295 and 398, and EGCs 54XX and 58XX. TEFRA cases will be worked as priority. Any reference to Exam cases in these procedures includes TEFRA program cases.

  3. IDT allegations received on SBSE and W&I Campus Exam cases will be closed on AIMS prior to routing to IDTVA. The W&I cases will be closed on AIMS as a disposal code 12 with no assessment. The SBSE cases will be closed on AIMS as a disposal code 37 with no assessment.

  4. IDT cases with Exam involvement may be referred directly from AM without Exam aware there is an IDT allegation. Cases received directly from AM or through CIS where AIMS is open will require contact with Exam to request that the case be closed off AIMS.

    Exception:

    If a case will be worked within five (5) days of assignment, do not request AIMS to be closed. Contact Exam when a final determination is made.

  5. IDT cases received in the following Exam campuses will refer any IDT claims meeting the criteria outlined below to the Brookhaven IDTVA-Exam team. All other campuses will refer IDT claims to the co-located IDTVA teams:

    • Cincinnati

    • Memphis

    • Ogden

    • Philadelphia

  6. Cases worked in IDTVA-Exam will be granted appeal rights by Exam as outlined in IRM 4.13.6, Appeals, and IRM 4.19.13.14.2, Transfer to Appeals.

IDTVA - C Exam General Procedures
  1. Identity theft correspondence received in the Exam function will be referred to the IDTVA team by Exam.

  2. Exam will complete the following for IRS-Identified IDT cases prior to referring to IDTVA-Exam:

    1. Input TC 971 AC 522 IRSID if not already present,

    2. Document the factors for determining IRS-identified IDT on AMS history and Correspondence Examination Automation Support (CEAS) notes.

      Note:

      Always verify that IDRS indicators are input for the correct taxpayer. If the secondary taxpayer is the victim, the IDT indicator must be input on the secondary SSN and not input on the primary taxpayer’s account.

  3. If cases are referred by Exam to IDTVA-Exam not fitting the criteria listed in IRM 25.23.4.4.1, IDTVA-C - Case Referrals from Compliance Functions. IDTVA-Exam will reject the case back to the referring Exam site. A listing of functional coordinators may be found on the Servicewide Electronic Research Program (SERP) Who/Where tab at SBSE campus point of contact (POC) or for W&I campus Exam contact the AIMS coordinator found on AIMS/ERCS Staff by User Location.

  4. New receipts will be referred from Identity Protection Specialized Unit (IPSU), AM or any other function and assigned directly to IDTVA-Exam on CIS rather than through the Exam function. If a referral is received for an open AIMS (-L freeze on master file) Exam case that is not currently assigned to IDTVA inventory, IDTVA-Exam will contact the Exam functional coordinator as appropriate per IRM 4.19.13.25.3, Taxpayer Replies. Review the CCA 4243 weekly to verify new receipts are addressed.

    1. W&I Exam case (PBC 190-194) - Send an e-mail to the AIMS coordinator with the SSN and tax year(s) to request AIMS be closed DC 12.

    2. SBSE Exam case (PBC 295-299) - Send an e-mail to the appropriate SBSE campus point of contact (POC) with the SSN and tax year(s) to request AIMS be closed DC 37.

  5. Field Exam reconsideration cases where a taxpayer alleges IDT will also be transferred to IDTVA-Exam when the above criteria is met. Field Exam reconsideration cases are centralized in the IDTVA-Exam Brookhaven (BSC) team.

  6. Follow the instructions in IRM 25.23.4.5.1.1, CIS Case Controls, to determine what controls to open.

  7. Upon receipt, IDTVA-Exam will review all new referrals per IRM 25.23.10.12.4.2.1, Technical - Initial Handling Procedures, and send the referrals to the Image Control Team (ICT) batching to assign to the corporate number per IRM 25.23.10.2, Case Batching. The update and acknowledgment to the referring team will be completed within 5 business days of receipt into IDTVA-Exam.

  8. During telephone contact, verify the taxpayer’s phone number on IDRS for all account related calls in which disclosure verification has occurred. Add or update phone numbers on IDRS and specify the type of number, i.e., home, cell, etc. If contact information is provided on correspondence and it is determined to be from the valid TIN owner, add or update the phone number(s) on IDRS. Include any revised or new phone numbers(s) in CIS notes. If IDRS is currently unavailable, perform follow-up action when the system is available.

  9. CIS case notes will be used to clearly identify research completed, analysis of documentation, determination and action completed. Examiners will follow Compliance work paper documentation guidelines, refer to IRM 25.23.2.11.1, Documentation of Actions.

  10. For any cases going back to Exam, prepare Form 3210, Document Transmittal, listing all social security numbers (SSN) and tax year(s) that are being returned. Return any cases and the Form 3210 to the appropriate functional coordinators as indicated in (3) above.

    Note:

    For CIS cases - indicate on Form 3210 next to the SSN that the case information and documents are available on CIS/AMS.

  11. Attach any Form 3210 or e-mail sent to Exam to the CIS record.

  12. All IDT referrals will be batched and routed to ICT for scanning and assigning on CIS. See IRM 25.23.10.2, Case Batching for additional instructions.

  13. All IDTVA-Exam IDT accounts, including any additional years impacted will be controlled following the guidance in IRM 25.23.4.5.1.1, CIS Case Controls. This includes tax years identified during the research and determination review of the IDT claim. When creating CIS cases for additional years, use the appropriate category code, priority code, and document type.

    Reminder:

    When opening additional years due to CCA use the current date as the IRS received date.

  14. For all accounts filed during the current year, input TC 971 AC 850 upon receipt of the ID theft allegation or claim.

Technical Procedures for All Cases
  1. This section provides specific guidance to IDTVA-Exam examiners who work IDT cases with Exam involvement.

Technical - Initial Handling Procedures
  1. Initial review of the taxpayer’s response is necessary to ensure a valid identity theft claim was submitted. If the taxpayer’s response does not indicate a claim of identity theft or dispute of the posted return and IDRS research does not identify indicators of IDT, take the appropriate action to return the case to the referring Exam function for normal processing.

  2. IDT cases that are assigned to an examiner must have the activity code updated when specific case actions occur.

  3. Refer to IRM 25.23.2.16, Initial Allegation or Suspicion of Tax-Related Identity Theft - IMF Identity Theft Indicators, to determine if a TC 971 AC 522 is required to be input.

  4. It is critical that the taxpayer is not harmed once it has been determined that the taxpayer is a victim of IDT. To ensure that the taxpayer is not being harmed from a collection action, see IRM 25.23.4.7.6, Collection Activity - Form 14394/13794, for further instructions on suspending enforcement actions.

    Reminder:

    Copies of the Form 14394/13794 must be included with the package sent to ICT and scanned to CIS.

  5. An acknowledgment or determination letter must be issued within 30 days of receipt into IDTVA-Exam. Follow the instructions in IRM 25.23.10.3, Letter Procedures, to send an acknowledgment letter if one has not already been issued.

  6. All statute year receipts will be reviewed for potential statute issues. See IRM 25.23.2.12, Statute Protection.

  7. At any time during the account review, if there is evidence the taxpayer has a filing requirement but has not filed a return, solicit and encourage the taxpayer for a signed return. This applies to any years reviewed and impacted by the IDT incident.

  8. Field Exam will work all cases where an IRS employee(s) alleges IDT and the tax year(s) is currently open or closed in Exam. Return or forward any IDT claims to the site where the audit is in process or was completed. Exam will refer these cases to Field Exam per IRM 4.19.11.1.23, Employee Returns.

Returning Cases to Exam
  1. Cases received from Exam where the case was closed as a DC 12/37 or AIMS is still open may be returned to Exam in the following situations:

    1. IDT allegation is deemed invalid;

    2. IDT allegation is income only with additional exam issues,
      AND

    3. There is more than 12 months left on the statute (ASED).

  2. When returning cases to Exam, the case must be referred to the originating campus. Use the following BOD specific guidance for all IDT determinations:

    1. W&I Exam case (PBC 190-194) - prepare and send Form 3210 to the AIMS coordinator with the SSN and tax year and the determination.

    2. SBSE Exam case (PBC 295-299) - Send an e-mail to the SBSE campus point of contact (POC). Include the SSN and tax year and the determination.

      Note:

      Attach a copy of the Form 3210 or e-mail to the CIS record. Insure all documents received are available to view on CIS. Any documents added to CIS as attachments cannot be viewed through AMS. If there are documents that will assist Exam in the resolution of their case, they will need to be scanned to CIS.

Field Exam Reconsiderations
  1. Any Field Exam reconsiderations where the taxpayer is alleging IDT will be routed to the IDTVA-Exam Brookhaven team for a determination and worked on CIS.

  2. Field Exam reconsiderations are cases that were worked in PBC 201-207. Cases worked in PBC 315 are Large Business and International (LB&I) cases. Any LB&I cases are referred directly to the LB&I Reconsideration team located at:
    2970 Market Street
    Philadelphia, PA 19106
    Mail Stop 4-E08.200

  3. Cases may be received from Exam Centralized Reconsideration Unit or directly from AM through CIS.

  4. Field reconsideration IDT allegations will follow normal IDT procedures, including issuing an acknowledgment letter, requesting additional information, adjusting accounts, if applicable.

Field Exam Reconsideration Evaluations
  1. Follow all normal IDT research paths to determine whether the taxpayer is a victim of IDT.

  2. Field Exam CEAS documents must be reviewed to determine whether the IDT allegation was addressed during the original audit. Once reviewed, determine whether the case should be retained or returned to the appropriate Field Exam.

  3. Cases that were no shows/no response in the Field Exam will be retained and worked in the campus.

  4. Cases will be transferred back to the Field Exam if:

    1. IDT cannot be determined from the work papers/case notes,

    2. The issue is outside the scope of the examiner, or

    3. the taxpayer responded to the IDT evaluation with documentation to prove the audit issues.

  5. In cases where the IDT issues was resolved, do not return the case to the Field Exam. Follow normal procedures to resolve the taxpayer’s correspondence.

  6. In cases where there is taxpayer contact and the IDT was addressed but the account was not corrected properly, i.e., the refund issued due to the identity theft return was not moved to the GL 1545 account, do not return to the Field Exam, resolve the account.

  7. Document CIS with the reason the case is/is not being transferred back to the Field Exam (i.e., CEAS notes input by the Field Exam indicate the revenue agent (RA) or tax compliance officer (TCO) had contact with the taxpayer or the taxpayer submitted documentation during the audit).

Returning Cases to the Field Exam
  1. When it is determined a case will be referred to the Field Exam due to an IDT allegation, the following information must be included as part of the case file:

    1. Form 3210 completed with the name and address of the appropriate Field Exam IDT Coordinator. Include the taxpayer’s SSN, tax year(s), and the reason for the referral.

    2. Form 14039, Identity Theft Affidavit, or police report.

    3. The TC 30X administrative file. Two (2) attempts must be made to obtain the administrative file. If the administrative file cannot be obtained, include copies of the Form 2275, Records Request, Charge or Recharge, showing the results of the search.

  2. Forward the complete package to the AIMS Coordinator. Include instructions for the AIMS Coordinator for which Field Exam the AIMS should be opened, i.e., PBC, EGC, source code, activity code, and aging reason code 14. The AIMS Coordinator will open AIMS and transfer the case to the appropriate Field Exam.

Post Function DITA Procedures

  1. Cases will be assigned to DITA on CIS by the referring function. Field cases will be scanned in accordance with IRM 25.23.10.2, Case Batching.

  2. Field and Specialty Collection, Field Exam, and LB&I will not control cases on IDRS or refer through CIS. RPM claims received from the field will be scanned to CIS with document type DITA RPM and category code IDII.

  3. New referrals received in DITA must be screened to determine if the collection activity has been addressed by the referring function for all referred years. See IRM 25.23.4.7.6, Collection Activity - Form 14394/13794, for screening criteria. If the referring function did not address the collection activity for all referred years, return the case by updating the case data to reflect the information of the referring function and reassigning it back to the referring employee number. Leave a case note such as collection activity not addressed or similar verbiage.

    Note:

    Any collection activity forms that are sent to ACSS by the referring function should be available for viewing on the CIS System.

    Exception:

    If the case was referred by ACS Support the Form 14394, Identity Theft/RPM Case Collection Alert should not be completed.

  4. DITA examiners are responsible for completing the corrective adjustments to remove transactions/assessments related to the identity theft incident from impacted accounts. The referring functions are responsible for making the ID theft determination prior to referring the adjustment request. DITA will generally not review the determinations made by the referring function for accuracy.

  5. DITA employees may identify the ID theft referral was incomplete. DITA will contact the referring operation and request that the missing information be provided or corrected. If DITA is unable to obtain the necessary information, then the referral will be rejected through CIS back to the referring employee number. The DITA liaison will document the request for information in a CIS Case Note.

    1. Rejected Field referrals will be faxed back to the originator with the reject reason clearly identified on the referral document. If a fax number is not available, contact the originator via telephone or e-mail to obtain a fax number.

  6. Any case determined to be mixed entity will be rejected back to the function for referral to AM. DITA will only resolve identity theft cases.

  7. On cases that are statute imminent the referring operation will update the priority code to "2" . Assign the case to an employee and ensure these cases are worked as priority inventory.

  8. Account resolutions are worked in accordance with IRM 25.23.2 , Identity Protection and Victim Assistance - General Case Processing, IRM 21.4, Refund Inquiries, IRM 21.5, Account Resolution, IRM 25.23.4, IDTVA Paper Process and IRM 25.23.3, IMF Identity Theft Toll-Free and Identity Protection Specialized Unit (IPSU) Paper except where stated.

  9. DITA will be responsible for completing all actions up to the manual interest computation and completing the subsequent required actions.

  10. In addition to performing account adjustments, DITA will be responsible for inputting all IDT indicators for Field & Specialty Collection, Field Exam and LB&I. The IDT indicators must be input within two (2) days of receiving the Form 4844, Request for Terminal Action.

  11. DITA is not restricted from addressing accounts with open Examination controls (i.e., Exam –L, prior TC 300, and prior AUR adjustments).

  12. OARs and ITARs received from the functions are worked as a priority by the DITA team.

  13. In certain cases, requests may be made to expedite a case. Additional Compliance work can continue after DITA removes the bad information from the account. In addition to the priorities in, IRM 25.23.4.7.9, Priority Codes for IDTVA - C Cases, the following must be worked as priority:

    1. The Revenue Agent/Officer notates “Expedite” at the top of the Form 4442, Inquiry Referral or Form 3870, Request for Adjustment.

    2. Open TEFRA cases

    3. Open L freeze cases

    4. Counsel Cases

  14. After all account actions have been taken, including inputting the appropriate TC 971 AC 501 or AC 506, see IRM 25.23.2.18.1, Closing Taxpayer Initiated Identity Theft Affecting Tax Administration - TC 971 AC 501 or IRM 25.23.2.18.3, Closing IRS Determined Identity Theft Affecting Tax Administration - TC 971 AC 506 for additional information. The DITA employee will also document the case actions taken on CIS and will close the CIS case.

    Note:

    When a TC 971 AC 501 or AC 506, DITA will use the BOD and Program Name of the referring function in the MISC section. See IRM 25.23.2-2, IMF Only TC 971 AC 501 — Taxpayer Initiated Identity Theft Case Closure (Tax-Related) - TC 971 AC 501, for more information.

    Example:

    If DITA received the referral from IDTVA - AUR and the taxpayer did not have a filing requirement, then "SBSE AUR NOFR" would be entered into the MISC section.

    Exception:

    DITA will not close the CIS Case if the referring employee has requested it to be returned.

  15. Upon closing all field Exam cases, DITA is required to inform the referring field examiner of the case closure via e-mail or fax.

Processing TC 150 Returns to an IRSN
  1. For cases that do not meet the criteria to process as a nullity, Taxpayer B’s information must be moved to an IRSN to make the SSN owner "whole" unless the account can be corrected using the procedures in IRM 25.23.4.15.4, Determining When Specific Year Account Information Must Be Moved.

  2. An IRSN is a temporary number issued by the IRS, and is always on the invalid side of Master File. It is in 9NN-NN-NNNN* format, with the 4th and 5th digit ranges of 01-03, 04-10, 17-19, 28, 29, 37-39, 49, 66 and 89. See IRM 3.13.5.21, Internal Revenue Service Number (IRSN) Format for more information regarding the 4th and 5th digit ranges.

  3. IDRS CC TMSSN automates the process of assigning an IRSN when a valid SSN cannot be located for a taxpayer who files a fraudulent return using another person’s SSN. Taxpayer B’s entity information is entered in TMSSN, this assigns Taxpayer B an IRSN. See Exhibit 2.4.59-1, IMF Input Format for CC TMSSNI.

  4. Write the IRSN on the history sheet or Form 4442. Once you exit the TMSSNI screen, the IRSN number can’t be retrieved.

  5. If the ASED is within 180 days of expiring, follow IRM 25.6.1, Statute of Limitations Processes and Procedures.

  6. If the ASED has expired for the return, refer to IRM 25.23.10.12.5.1.1, Moving Account with Expired ASED to IRSN.

  7. After addressing any ASED issues, refer to IRM 21.5.2.4.23, Reprocessing Returns/Documents, for procedures to secure, prepare and code returns for reprocessing to an IRSN.

Moving Account with Expired ASED to IRSN
  1. If research indicates that Taxpayer B’s return does not meet nullity procedures and the ASED has expired, move the ID Theft assessment to an IRSN using Form 12810, Account Transfer Request Checklist. Include the following:

    1. DLN

    2. TIN

    3. MFT

    4. Tax Period

    5. Complete Entity information

    6. IDRS transcript of account

    7. Transaction Codes

    8. In the Remarks section, input “ID Theft Case”

  2. Request an IRSN with CC TMSSN. Notate the IRSN on the case history sheet.

  3. If the tax period is in a credit balance, the credit must be resolved prior to preparing the Form 12810 by refunding to the correct taxpayer, if allowable based on the Refund Statute Expiration Date (RSED), or as a transfer to Excess Collections. See IRM 21.2.4.3.10.1, Excess Collections File (XSF) for AMRH .

  4. Input the applicable TC 971 codes on the losing and receiving modules.

  5. Route the Form 12810 and attachments to Accounting for processing.

    Note:

    Not all statute or imminent statute year returns need to be moved off the SSN using Form 12810. Refer to IRM 25.23.4.15.4, Determining When Specific Year Account Information Must Be Moved

    .

Format for E-mails to Appeals

Use this e-mail format when sending Form 10467 electronically to Appeals.


To: *AP Inquiries
Subject: ID Theft Case in Appeals

Attached is Form 10467, Appeals Division Feedback Report and Transmittal Memorandum, regarding an identity theft complaint filed by a taxpayer currently open in Appeals. Please forward this e-mail to the Appeals employee assigned the case, or associate with the case file if unassigned.

Taxpayer’s Name:
SSN:
Tax Year(s):

AUR Standardized Case Notes for IDTVA (AUR Open Cases Only)

  • 22 - IDTVA - Close case no change.

  • 23 - IDTVA - Delete IR(s) (Fill in IR #(s). Continue processing.

  • 24 - IDTVA - Case was determined not to be IDT. Continue processing.

  • 25 - IDTVA - Letter was issued to the taxpayer requesting additional information. Follow-up date has expired with no response from the taxpayer. IDT claim will be closed, continue processing the case.

  • 27 - IDTVA - Case was referred to EXAM. Close case no change.