25.25.3 Revenue Protection Verification Procedures for Individual Master File Returns

Manual Transmittal

September 15, 2017

Purpose

(1) This transmits revised IRM 25.25.3, Revenue Protection, Revenue Protection Verification Procedures for Individual Master File Returns.

Material Changes

(1) Editorial changes made throughout the IRM section.

Effect on Other Documents

IRM 25.25.3 dated September 26, 2016 is superseded. This IRM also incorporates the following IRM Procedural Updates (IPUs) - IPU 17U0114 issued 01-17-2017 and IPU issued 06-21-2017.

Audience

Campus employees in Integrity & Verification Operation, Return Integrity and Compliance Services

Effective Date

(09-15-2017)

Michael C. Beebe
Director, Return Integrity and Compliance Services
Wage and Investment Division

Program Scope and Objectives

  1. Purpose and Program Goals: This IRM section provides guidance for Integrity and Verification Operation (IVO) employees when verifying individual master file returns in the Electronic Fraud Detection System (EFDS) for possible identity theft and false income and withholding. Individual master file returns are scored through the Dependent Database (DDb) or through the Return Review Program (RRP) system. These scoring processes identify suspicious returns meeting the scoring tolerances for screening by IVO employees.

  2. Audience: The audience intended in this IRM is IVO employees.

  3. Policy Owner: The Return Integrity and Compliance Services (RICS) is the policy owner of this program.

  4. Program Owner: RICS is the program office responsible for oversight over this program.

Background

  1. Return Integrity & Compliance Services (RICS) strengthens the integrity of the tax system by:

    • Protecting the public interest by improving IRS’s ability to detect and prevent improper refunds

    • Serving the public interest by taking actions fairly and appropriately to identify, evaluate and prevent the issuance of improper refunds

    • Helping taxpayers understand the refundable tax credits for which they are eligible

Program Management and Review

  1. The program has reports to track the inventory, including receipts and closures.

  2. A quality program is in place to review all processes to ensure accuracy and effectiveness.

Authority

  1. Refer to the following:

    • IRM 1.2.13.1.10, Policy Statement 4-21

    • IRM 1.1.13, "Organization and Staffing, Wage and Investment Division."

    • Various Internal Revenue Codes (IRC) including but not limited to:

    • IRC 6402(a)

    • IRC 6401

    • IRC 6404

    • IRC 6413

Responsibilities

  1. Return Integrity and Compliance Services (RICS) has responsibility for information in this IRM. Information is published in the IRM on a yearly basis.

  2. The Director of RICS is responsible for the policy related to this IRM.

  3. The Chief of the Data Management and Operation Staff (DMOS) is responsible for ensuring this IRM is timely submitted to publishing each year.

  4. More information can be found in IRM 1.1.13.7, Return Integrity and Compliance Services.

Acronyms

  1. The acronyms below are utilized in the Integrity and Verification Programs:

    Acronym Definition
    AQC Automated Questionable Credit Program
    ARAP Accelerated Refund Assurance Program
    ARG Frivolous Argument Codes
    ASFR Automated Substitute for Return
    AUR Automated Underreporter
    BFS Bureau of the Fiscal Service
    BMF Business Master File
    BOD Business Operation Division
    BS Blocking Series
    CAP Collection Appeals Program
    CC Command Code
    CCC Computer Condition Code
    CDP Collection Due Process
    CE Contact Employer
    CI Criminal Investigation
    CIS Correspondence Imaging System
    CP Computer Paragraph
    CSR Customer Service Representative
    DDb Dependent Database
    DLN Document Locator Number
    DM Data Mining
    EFDS Electronic Fraud Detection System
    EIC Earned Income Credit
    EUP Employee User Portal
    FMS Financial Management Service
    FOIA Freedom of Information Act
    FRE Fraud Referral and Evaluation
    FRP Frivolous Return Program
    GATT General Agreement on Tariffs and Trade
    HQ Headquarters
    HSH Household Help
    IA Installment Agreement
    IDOC Income Document
    IDRS Integrated Data Retrieval System
    IDT Identity Theft
    IMF Individual Master File
    IPSU Identity Protection Specialized Unit
    IRA Information Returns Acceleration
    IRC Internal Revenue Code
    IRM Internal Revenue Manual
    IRS Internal Revenue Service
    ITAR Identity Theft Assistance Request
    ITIN Individual Taxpayer Identification Number
    ITLA Interactive Tax Law Assistant
    IVO Integrity and Verification Operation
    LDC Lead Development Center
    MeF Modernized e-file
    MFJ Married Filing Jointly
    MFT Master File Transaction
    MOC Mode of Contact
    MS Mail Stop
    OAR Operations Assistance Request
    OIC Offer in Compromise
    PS Process Status
    PTC Premium Tax Credit
    PUB Publication
    RAC Refund Anticipation Check
    RAL Refund Anticipation Loan
    RC Reason Code
    RCO Return Chargeout
    RGS Report Generation Software System
    RICS Return Integrity & Compliance Services
    RPC Return Processing Code
    RRP Return Review Program
    SB/SE Small Business/Self Employed
    SFR Substitute for Return
    SPC Special Processing Code
    SSA Social Security Administration
    SSA_ORS Social Security Administration Online Reporting System
    SSN Social Security Number
    STARS Scheme Tracking and Referral System
    TAC Taxpayer Assistance Center
    TAR Technical Assistance Request
    TAS Taxpayer Advocate Service
    TC Transaction Code
    TE Tax Examiner
    TIGTA Treasury Inspector General for Tax Administration
    TIN Taxpayer Identification Number
    TP Taxpayer
    TPP Taxpayer Protection Program
    TT Toll-Free Tax Technicians
    UCC Uniform Commercial Code
    URC Unpostable Resolution Code
    UTV Unable to Verify
    WI Wage and Investment
    WMS Workload Management System
    WOW Wage and Withholding Only

Related Resources

  1. The related resources listed below may be utilized for account research and issue resolution. These related resources may be accessed through the IRS Intranet-Servicewide Electronic Research Program (SERP) site.

    • IRM 25.25, Revenue Protection

    • IRM 25.23, Identity Protection and Victim Assistance

    • IRM 21, Customer Account Services

    • IRM 2, Information Technology

    • IRM 3, Submission Processing

Verification of Income

  1. Verification of income documents (IDOC(s)) attached to Individual Master File (IMF) returns is critical to stopping questionable refunds. The IRS is required to notify a taxpayer in advance that a third party may be contacted to help resolve their account. For further information concerning third-party notification, see IRM 5.19.5.10, Notification of Third Party Contact.

  2. Observe the Taxpayer Bill of Rights as spelled out in Publication 1, Your Rights as a Taxpayer, particularly with respect to confidentiality and privacy when conducting research and/or contact with third parties to obtain income verification.

  3. When an IDOC is sent to Verification, Workload Management System (WMS) will place the IDOC in "Suspense" for 10 days. The IDOCs can be viewed but no action can be taken on the IDOC during the 10 day suspense period. Generally, IDOC(s) may include:

    Note:

    The list is not all inclusive.

    • Form W-2, Wage and Tax Statement

    • Form W-2G, Certain Gambling Winnings

    • Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.

    • Form 4852, Substitute for Form W-2, Wage and Tax Statement or Form 1099 R, Distribution From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs

    Exception:

    You may receive a Form 12412, Operations Assistance Request (OAR), from Taxpayer Advocate Service (TAS). The request may state, TAS has informed the taxpayer the employer will be contacted to verify the income document and the taxpayer has agreed to the employer contact. If all the information is on the OAR, you can verify the income with the employer without the 10 day letter or any suspension time. Add a note to Electronic Fraud Detection System (EFDS): OAR Received taxpayer agrees to employer contact.

  4. There various methods used to verify IDOCs:

    • Fax Verification - the request is made by fax

    • Phone Verification - the request is made by a call

    • Disc Verification - income information is (or will be) provided on a disc by the employer

    • Command Code (CC) IRPTR Verification - verification performed using CC IRPTR data information

    • Information Returns Acceleration (IRA)

    Note:

    Use CC IRPTR to verify all prior year income and withholding issues. For returns containing an Individual Taxpayer Identification Number (ITIN) for the primary and/or secondary, see IRM 25.25.3.16, Updating Individual Taxpayer Identification Number (ITIN) Income Documents (IDOC(s)). Use CC IRPTR first for all types of verification each filing season per leadership direction.

  5. The Income Verification Table is used to verify income using CC IRPTR. Only, use the table below if CC IRPTR data is available for the tax year:

    Note:

    CC IRPTR data containing the statement: ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , should never be considered employer data. Follow the procedures in the last box of the chart below for "Is not available" .

    If CC IRPTR data for the IDOC and Employer Identification Number (EIN) Enter into the name position in CE Update CE current IDOC disposition
    1
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
      OR

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

    "PER IRPTR"

    Note:

    When working IRA inventory, enter "IRA IRP"

    "Verified OK"

    Note:

    Follow instructions in paragraph 6 prior to updating the IDOC to "Verified OK" .

    2
    Is available and does not fall within the above money and percentage limits
    "PER IRPTR" Enter wages and withholding amounts per CC IRPTR or as indicated on IRA spreadsheet, as applicable.

    Exception:

    Taxable pension/annuity income amounts may differ due to the taxpayer’s calculations. Accept the taxpayer’s figures for the income, however the withholding must verify per tolerance.

    3
    Is not available or is available but contains the statement: ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ (consider verified false)
    "PER IRPTR" Not Employed
  6. If CC IRPTR data is available and matches the wages and withholding on the IDOC, prior to updating the IDOC disposition in CE to "Verified OK" , additional steps must be taken as indicated in the following chart:

    IF THEN
    1
    EFDS Return Notes indicate:
    "Compromised IRP Data - Do Not Release Based on IRP" .
    Additional research is required to ensure the return was filed by the TIN owner. Compare the following information from the two prior year returns to the current year return:
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "Refile" the return in EFDS. Input an EFDS return note indicating research results.

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "Refile" the return in EFDS. Input an EFDS return note indicating research results.

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

    2
    The calling instructions on the Employer Info Tab read "20NN IRP Confirmed" or "20NN EIN Good/IRPTR Data Loaded-Use G or B"
    Consider the IDOC "Verified OK"

    Note:

    No additional notes are necessary.

    3
    The calling instructions on the Employer Info Tab does not read, "20NN VALID EIN /PAYMENTS CONFIRMED PER IRA"
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    • If ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

    • Consider the IDOC "Verified OK" and input a note "20NN IRP Confirmed" , in the calling instructions.

    • If ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .

    • Consider the IDOC not verified. Do not update the IDOC disposition to "Verified OK" .

    • If the mode of contact is anything other than "Hold" pending Bogus Determination, change the Mode of Contact for that EIN to “Hold” pending Bogus Determination.

    • Input an EFDS note containing the research results.

    4
    The IDOC on CC IRPTR contains the following statement:
    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

    • Consider the IDOC not verified. Do not update the IDOC disposition to "Verified OK" .

    • If the mode of contact is anything other than "Hold" pending Bogus Determination, change the Mode of Contact for that EIN to “Hold” pending Bogus Determination.

    • Input an EFDS note containing the research results.

    Note:

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

  7. When a return is sent for verification, the employer may have/or need a mode of contact (MOC) assigned in CE. A MOC identifies the way an employer will be contacted to verify income and withholding information for a questionable IDOC. Research to locate missing employer contact information and update CE notes as necessary.

  8. By law, employers are not required to provide IRS employees information unless served with a summons or subpoena. Summonses are issued by revenue officers, revenue agents, and special agents. Therefore, it is critical that proper telephone techniques are developed to the highest degree of efficiency and tact.

    Note:

    See IRM 21.1.1.7, Communication Skills, and IRM 21.1.3.2.2, Authorized and Unauthorized Disclosures, see IRM 11.3.1.11, Facsimile Transmission of Tax Information, for additional information.

  9. If an employer has a specific verification request (requests a specific person handle the request or requests all verifications are made on a particular day).

    • Notate the specific request in "Employer Notes"

    • Elevate the EIN to the lead/manager

    • The lead/manager will change the MOC to "Hold" , and reason "Management"

      Note:

      Management will determine if the National Office Interface (NOI) needs to be updated to assign these EINs to specific examiners.

  10. Integrity & Verification Operation (IVO) has agreed to verify documents that Criminal Investigation (CI) has added to CE regardless of tolerance and refund lost. CI will input an EFDS note - CI POST REFUND when sending IDOCs on post refund returns to VERIFY. All IDOCs sent to verification must be verified.

Contact Employer (CE) Process

  1. The Workload Management System (WMS) is used to access the application Contact Employer (CE) and is used to manage the income verification process at both a National and Local level. The employee will log into WMS and access CE from the main menu bar.

  2. Documentation/remarks in the Electronic Fraud Detection System (EFDS) is essential for proper movement, treatment and resolution. Remarks should be brief and specific to the issue/case or as directed by the IRM.

  3. If the Employer Identification Number (EIN) has a specific day or time that they can receive a call, refer the request to the lead/manager who will submit the EIN assignment request to Data Management & Operational Support (DMOS) and take the following actions:

    • The manager will change the mode of contact (MOC) to" Hold" , and reason "Management"

    • Update the specific request in "Employer Notes"

    • Manager will monitor daily to ensure follow up actions are taken

    Note:

    All IRS employees working tax related matters must provide their name and badge identification number when making phone calls. See IRM 21.1.1.7, Communication Skills, for details.

    If the employer questions the validity of the call or is reluctant to provide their EIN, you may provide the last 4 digits of the EIN, then request that the employer verify the first five digits as verification.

  4. If the MOC is "Call OK" , then telephone contact is made. If MOC is "No Selection" , research is required to locate the employer's phone number. The employer must be called to establish a preferred MOC. If the MOC is "Fax Only" , the fax will automatically generate in the batch fax. See IRM 25.25.3.8, Batch Fax.

    Reminder:

    If the employer asks, you may let them know we contacted the taxpayer at the address of record and informed them that third-party contact may be made.

  5. If the employer chooses to receive all future verifications by phone:

    • Input contact name and telephone number into the "Employer Keyin Information" section.

    • Update the MOC to "Call OK" .

  6. If the employer chooses to receive all future verifications by fax:

    • Input contact name, secure fax number and telephone number into the "Employer Keyin Information" section.

    • Update the MOC to "Fax Only" .

  7. If the employer requests a one-time fax:

    • Input contact name, secure fax number and telephone number into the "Employer Keyin Information" section.

    • Update the Status Information box to "Send Fax" for every IDOC waiting for verification.

    • Do NOT change MOC to "Fax Only" .

    • Do not print or fax the request. This fax will be sent from the assigned fax site within 2 business days.

  8. If contact information (phone or fax number) is not found in CE, perform additional research. See Exhibit 25.25.3-3, Research Check Sheet.

    Note:

    The company’s established date is found on the "Employer Info" tab in CE. Complete research through the Integrated Data Retrieval System (IDRS) to identify any periods of time the business was functional.

  9. If research indicates a possible Bogus EIN or a company with no employees, complete the following steps:

    1. Input into the "Employer Notes" field and include all research

    2. Set the MOC to "Hold" , reason "Bogus Determination"

  10. Some EINs may need assignment of "Hold" , reason "Other" . These include:

    • Failed faxes - to stop additional faxes from going out to bad numbers

    • Spanish speaking verifications

    • International phone calls

    • Employer is still waiting on his records (early in the season)

    • IDOCs that are unable to verify or need manager or lead assistance

Bogus Employer Determination

  1. The Bogus Review Team will perform research on the Employer Identification Number (EIN) using the following Integrated Data Retrieval System (IDRS) command codes (CC):

    • CC BMFOLP is used to research for payments made under the EIN.

    • CC BMFOLI is used to research for filed returns.

    • CC BMFOLL is used to research for a Final Form 94X return.

    • CC IRPTRL is used to research for income received from other sources.

    • CC IRPTRI is used to research for income documents issued by the company.

    Note:

    The company’s established date is found on the "Employer Info" tab in contact employer (CE). Perform complete research through IDRS to identify any periods of time the business was functional.

    • Research "Google" and "Accurint" for evidence of company existence.

    • Review associated returns and IDOCs in EFDS for indications of Bogus Employer.

  2. Take the following action based on the research results:

    Determination Tax Examiner (TE) Action Lead Action
    1
    True Bogus Company
    • Send all returns with a disposition of "None" to "Verify" .

    • Input research results in "Employer Notes" .

    • Leave MOC for employer as "Bogus Determination" .

    • Forward to Lead TE for review.

    • Review TE conclusion.

    • If agreed, forward to the manager.

    • If disagreed, return to TE with explanation.

    2
    Non Compliant Company in existence
    • Input research results in "Employer Notes" .

    • Change MOC to "Call OK" .

    • Forward to Lead TE for review.

    • Review TE conclusion.

    • If agreed, take no action.

    • If disagreed, return to TE with explanation.

    3
    Company has no employees
    • Input research results in "Employer Notes" .

    • Forward to Lead TE for review.

    • Review TE conclusion.

    • If agreed, change employer MOC to "No Employees" .

    • Input the following note into the Permanent Instructions – “NO EMPLOYEES for XXXX (Tax Period) include EFDS TE login XXXXXX17.

    • Manually disposition any IDOCs in the letter fax queue to "Not Employed" and input "No employees" in verifier name field.

    • Update record.

    • If disagreed, return to TE with explanation.

Telephone Verification

  1. Telephone verification inventory is maintained in contact employer (CE) by the "Stop Date" of the refund. Inventory is retrieved by running a Discoverer Query using the date the refund was held to ensure the cases are worked in received date order. Integrity & Verification Operation (IVO) employees will receive the inventory by selecting "Next EIN" in CE.

  2. Authentication of the employer identification number (EIN) is required for all calls made to the employer prior to releasing any taxpayer information. Authenticate the employer by verifying the following information:

    • Employer Identification Number (EIN)

    • Business Name

    • The company representative’s position or relationship to the company

  3. Telephone verification is used to verify questionable income documents (IDOC) such as Form W-2, Form 4852, and Form 1099 . During the initial contact, keep the focus on the information necessary to verify the income.

    • When the income is reported on a Form 1099-MISC, Miscellaneous Income, and the employer responded that the employee did not work for them, ask if the income could be sick pay, retirement pay, or another type of compensation.

    • If you are questioned on the reason for your call, explain you are reviewing wages and withholding information reported on the income document.

    • If the employer questions why you need the income information and/or questions whether we have the income and withholding information Form W-2, let them know this is just an accuracy check.

    • You can provide the taxpayer's name, social security number (SSN) or Individual Taxpayer Identification Number (ITIN), and tax year from the income document, to the employer in order to verify the wages and withholding. See IRM 21.1.3.2.2, Authorized and Unauthorized Disclosures, and/or IRM 11.3.1.7, Reporting Unauthorized Accesses or Disclosures , for additional information.

      Note:

      Ask the employer to research their records by taxpayer identification number (TIN) and by name.

      Caution:

      Do Not provide tax advice. If the employer asks questions about tax issues or account matters, refer them to 800-829-1040 for individual income tax questions or 800-829- 4933 for business related tax questions.

  4. If the employer refuses to verify the information over the telephone, provide them other options, such as faxing us the information to assist in the verification. You should ask if they will:

    • Verify if the person actually worked there

    • Provide the employment dates if the person did work for them

    • Verify the figures you have, if the employer only verifies that the employee worked for them but will not provide any other information, document the information in employer notes. Update CE to disposition "Employment Only" .

    Reminder:

    Employers are not required to provide this information, but we should encourage them to do so.

  5. If the taxpayer or employer does not respond or agree to respond within the set time frame, follow guidance in IRM 25.25.3.13, Unable to Verify (UTV) Procedures.

  6. Disposition the Employer Mode of Contact (MOC) after you have completed all phone research. See Exhibit 25.25.3-3, Research Check Sheet, for research steps.

  7. All phone voice-mail messages must be retrieved on a daily basis.

  8. If the call cannot be completed or information cannot be obtained from the employer, take the appropriate action based on the table below:

    If And Then
    1
    You attempt to contact the employer
    There is no number in CE or the existing number is no longer valid Research for another contact. If a number is found enter the number into the phone number field on "Employer Info" tab and continue with call. If no number can be found, go to "Cannot find a good number" instructions below.
    2
    You attempt to contact the employer
    A number is found and a person to contact and you get a busy signal
    1. Place the call in a callback folder/call log

    2. Place the employer in "Hold" , reason "Call Back IRS"

    3. In "Employer Notes" annotate: "Line busy"

    4. Attempt to contact the company or contact person again the same day. If you only get a busy signal, research for another contact number

    5. Attempt to call back the next day. Make a second attempt one hour later. If you only get a busy signal, research for another contact number /or call the employer to try to get another contact person

    6. If two or more contacts have been made and no number can be found or you cannot find a good contact person, place the record in "Hold" , reason "Bogus Determination" . Update "Employer Notes" with research information. Do not update IDOC disposition.

    3
    Contact person is reached
    Employer/Payroll states - they want to call IRS back (busy time for the employer/or they want the IRS to call them back).
    1. Place the call in a callback folder/call log

    2. Place the employer in" Hold" , reason "Call Back IRS"

    3. In "Employer Notes" annotate: Call back requested (enter the time/date)

    4. Check your call back list and return call at appropriate time

    4
    Contact person is reached
    Employer states - current year wage information not available yet
    1. Ask when the information will be available and when we can call back

    2. Place employer in MOC "Hold " , reason "Other"

    3. Update calling instructions: Waiting for wages and withholding year-end information. Input a permanent note: "Waiting for year-end wages/WH"

    4. Notate the date information will be available in the "Employer Notes" .

    5. Make a print of employer information and give to the assigned TE for follow-up

    5
    Contact person is reached
    The employer states - they have no employees for current verification year and/or prior years
    1. Ask the employer if they have or will be issuing any type of income documents on the Employer Identification Number (EIN) in question

    2. In "Employer Notes" notate contact name, position with company, phone number, what month/year company went out of business or stopped having employees, and any other pertinent information

    3. Research IDRS to ensure it backs up employer's claim, ex: CC BMFOL

    4. Place call into "Hold" , reason "Bogus Determination"

    5. Do Not Update IDOC Disposition

    6
    You cannot find a good phone number
    You cannot find any information that the company existed
    1. See Exhibit 25.25.3-3, Research Check Sheet, for research steps

    2. If research indicates a possible Bogus EIN or a company with no employees, complete the following:

      • Input all research performed into EFDS notes in "Employer Notes"

      • Set the MOC to "Hold" , reason "Bogus Determination"

    7
    You cannot find a good phone number
    There is information the company did exist in the past and a final Form 940/ Form 94X is on file
    1. Place call into "Hold" , reason "Bogus Determination" See Exhibit 25.25.3-3, Research Check Sheet, for research steps

    2. Input into "Employer Notes" that a final Form 940 or 94X is on file

    8
    You cannot find a good phone number
    There is information the company did exist in the past and a final Form 94X is NOT on file
    1. Update "Employer Notes" with "UTV-MISC" , Do not disposition the IDOC

    2. Refer to IRM 25.25.3.13, Unable to Verify (UTV), Procedures for UTV-MISC, EIN specific procedures

    9
    Two or more contacts have been made and the employer has not called back or provided the information
    1. Place in "Hold" , reason "Other"

    2. Update "Employer Notes" with "UTV-WNCB" Do not disposition the IDOC

    3. See IRM 25.25.3.13 , Unable to Verify (UTV) Procedures for UTV-WNCB procedures

Telephone Verification Process Details

  1. The purpose of Contact Employer (CE) is to automate the process of verifying suspicious income documents (IDOC) such as, Form W-2, Wage and Tax Statement, Form W-2G, Certain Gambling Winnings, and Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., that are submitted with potentially false returns. Tax Examiners (TE) need to be conscious of the IDOC type when making a phone call to the employer. Notate the Electronic Fraud Detection System (EFDS) CE permanent instructions if research or the employer indicates there are different numbers to call for different IDOC types.

    1. Log into EFDS

    2. Select CE application

    3. Click next Employer Identification Number (EIN), or click on refund stop dates/and or Scheme Development Center (SDC)

    4. Click on Get Record

  2. If valid contact information is located and mode of contact (MOC) is "Call OK" , call the employer to verify the EIN and the IDOC.

  3. If the employer prefers a one-time fax, include in the next day batch fax by taking the following actions:

    • Input contact name, secure fax number and telephone number into the "Employer Keyin Information" section

    • Update the Status Information box to "Send Fax" , for every IDOC waiting for verification

    • Do NOT change MOC to "Fax Only "

    • Do not print fax

  4. If the MOC is "No Selection" , verify the EIN, research employer and call employer to get the MOC. Once the MOC is established, update CE and disposition the IDOC.

  5. When the call back time is set for next day or the employer's preference, notate on call log/folder. Enter information in CE and place in" Hold" , reason "Call Back IRS" .

    Note:

    Keeping the focus on the information necessary to verify income, will minimize the opportunities for unauthorized disclosures. Take special precautions if it is necessary to leave a message on an employer's voice mail. See IRM 11.3.2.7.1, Leaving Information on Answering Machines/Voice Mail.

  6. Always review "Return Notes" for additional information including the tax year you need to verify.

    Example:

    Return note indicates tax year 201512. This indicates a 201512 return filed during the current processing year.

Completing the Call

  1. Once verification has been completed, the following steps must be taken in Contact Employer (CE):

    1. Locate the employer's Employer Identification Number (EIN)

    2. Select the "Work Tab"

    3. Locate the Social Security Number (SSN) on the "Work Tab"

    4. Input the first and last name of the person who verified the income document (IDOC) into the "Name box"

    5. If the contact person has permanently changed, update the "Employer Info Tab" with the new information

    6. Place the contact person you are removing from the "Employer Keyin Information" section with any phone/fax numbers into the "Employer Notes"

    7. Input the title and telephone number without parentheses into the "Position box"

      Example:

      Office Manager 123–555–7890

    8. Enter "Refused" in the appropriate field(s) if the employer contact or title is not provided

    9. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    10. Include "Return Notes" , if applicable

    11. Include "Employer Notes" , if applicable

  2. IDOC Disposition Choices:

    IDOC Disposition Narrative for Disposition
    1
    Send Fax
    • A one-time fax will be used for this IDOC to obtain information from the employer.

    2
    Incorrect $
    • The wages and withholding amounts verified by the employer do not match the figures of the IDOC. When the amounts are entered, CE will automatically check the figures, considering the tolerances and the literal "Incorrect $" will display. This is a final CE disposition.

    3
    Employment Only
    • Use this disposition when the employer will only verify the taxpayer was employed or when the person you are verifying is the owner of the company and Form 94Xs are required. Contact with the company needs to be made to ensure there is no one else that can verify the information.

    • The system displays the note box. Enter the employment information (for example: dates of employment, verified employment only, etc.) provided in the EFDS return section. This is a final CE disposition.

    4
    No Response
    • This disposition should not be used. This is a final disposition that will refile the questionable return and release the refund.

    5
    Not Employed
    • This disposition is used when the employer verifies that the person listed on the IDOC was not employed or had no income from that employer. This is a final CE disposition.

    6
    Verified OK
    • Employer verified the IDOC information is correct. When this disposition is selected, actual income and actual withholding are automatically set to match the original income and withholding amounts. IDOC(s) with the disposition of "Verified OK" cause the returns to be systemically "Refiled" . This is a final CE disposition.

Batch Fax

  1. Verification Faxes are systemically generated in the Electronic Fraud Detection System (EFDS) and are printed in a batch process for transmission to the employer. The following case types cannot be printed in the batch process:

    • Gap Faxes (the mode of contact (MOC) is not "fax only" and the employer has requested a one-time fax). These will be manually printed by the tax examiner.

    • Faxes with 2 names in the name field for the Income Document (IDOC), see IRM 25.25.3.13, Unable to Verify (UTV) Procedures, for correction of the IDOC prior to faxing to the employer.

  2. After the fax is transmitted successfully, destroy as classified waste.

  3. If the submission of the fax is unsuccessful (example - failed fax), it will be placed in "Hold" , reason "Other" until it is assigned for resolution. Upon assignment, take the following actions:

    • Verify the fax number was entered correctly onto the fax machine. If it was not, re-send the fax using the correct information.

    • If still unsuccessful, research contact employer (CE) notes for an alternative fax number. If found, re-send the fax to the company.

    • If unable to find an alternative fax number, contact the employer for a correct or updated fax number.

    • Update CE "Employer Keyin Information" section with the new number, re-print and re-send the fax.

    • If attempts to find a fax number the same day are unsuccessful, change the employer MOC to "Call OK" and update "Employer Notes" with "Changing MOC from Fax Only to Call OK. Fax number is incorrect" .

  4. When the response is received from the employer, update the IDOC disposition in EFDS.

  5. All faxed responses from the employer will be maintained for six months. Faxes can be purged and destroyed as classified waste six months after the fax was received from employer.

Phone Calls From Batch Fax

  1. Employers may call in response to the batch fax. Follow IRM 25.25.3.7, Completing the Call, to process the information provided by the employer.

  2. If the caller asks other questions relating to the verification of income, answer the questions. See possible responses to questions in the table below:

    Note:

    This list is not all inclusive and provides some recommended responses. If you are asked a question about verification and you do not know the answer, tell the caller you will research the issue and call them back with an answer.

    Caution:

    Do NOT provide tax advice. If the employer asks questions about tax issues or account matters, refer them to 800-829-1040 for individual income tax questions or 800-829-4933 for business related tax questions.

    Caution:

    Do not contact the taxpayer to verify the income. The verification of the income must come from the employer, or authorized representative, or online information available to IRS.

    Employer Question IVO Answer
    1
    Call received is from the taxpayer being verified.
    • Advise the taxpayer we will contact the employer. Contact the employer and advise them that the verification of the income must be provided by the employer listed on the income document (IDOC) and cannot be provided by the taxpayer.

    2
    What do I do if I do not have my Form W-2 information completed yet?
    • Advise the employer to return the spreadsheet with a notation of when the Form W-2 information will be available.

    3
    What should I do if the employee is "Not Employed" ?
    • Advise the employer to fill out the fax and indicate "Not Employed" by marking either the "No income or federal withholding by SSN box" or the "No income or federal withholding by name box" .

    4
    Why are we requesting the verification?
    • Advise the employer that our department verifies Federal wage and withholding information to ensure the accuracy of IRS records.

    5
    I am not the employer you are trying to contact.

    Caution:

    This is an unauthorized disclosure issue and disclosure procedures must be followed see IRM 21.1.3.2, General Disclosure Guidelines

    .
    • Ask the employer to destroy the fax and follow Disclosure guidelines in the IRM.

    6
    Do I need to send a copy of the Form W-2 or just send in the completed spreadsheet?
    • Advise the employer that a copy of the Form W-2 is unnecessary, but they can submit it with the spreadsheet if they want to.

    7
    What do I do if I received a fax request to verify an employee with an Individual Taxpayer Identification Number (ITIN)? (The taxpayer identification number begins with a "9" and is being used in place of a Social Security Number (SSN)).
    • Advise the employer to check their records for the employee by both name and TIN.

    • Then, notate on the fax spreadsheet what information they have for that employee, including SSN, name, wages and withholding.

    8
    Am I required to let my employees know a request for wage verification has been made?
    • Advise the employer that informing the employee of the contact is the company's decision, however we have informed the employee we may be contacting the company.

    9
    Do I need to call to confirm that you have received my fax response?
    • Advise the employer that it is unnecessary to contact us to confirm receipt of the fax response.

Completing a Fax Verification Update

  1. When a fax verification has been received, locate the Employer Identification Number (EIN) listed on the fax in Contact Employer (CE) in Electronic Fraud Detection System (EFDS), then take the following actions:

    Note:

    When a blank or illegible fax is received, contact the employer to clarify or obtain the information.

    Employer Response Tax Examiner (TE) Action
    1
    Employer response with wage and withholding information
    • Input the first and last name of the person who verified the income document (IDOC). If this section of fax is blank or illegible enter "Not Provided" .

    • Enter in the "Position Box" the title and telephone number of the person who provided the information.

    • See Exhibit 25.25.3-2, Common Abbreviations.

    • If the name, title, or telephone number section of fax is blank, put "Not Provided" for the information that is missing.

    • Enter the Title and Telephone Number without parentheses.

      Example:

      Office Manager 123-456-7890

    • Enter the money amount in the appropriate fields when provided. Do not enter zeros if the final IDOC disposition is "Not Employed" . Select the appropriate disposition from the drop down menu.

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

    • Tab or click off the dollar fields to allow the disposition to update to the correct choice.

    • Include return notes and employer notes, if applicable.

    • All return notes must start with the EIN and should include any pertinent information indicated on the fax.

      Example:

      00-12345678, terminated 10-20-128

    2
    The "No Income Box" or "Never Employed Box" is checked.
    • Update disposition in CE to "Not Employed" .

    3
    New contact information for the employer has been provided.
    • If the employer provided updated contact information, call employer to confirm the change.

    • Update the "Employer Info Tab" with the changes.

    • If the entity information is changed, update "Employer Info" only if new information is shown on IDRS. If not present on IDRS, advise the employer to file a Form 8822.

    • Place any information you remove from the "Employer Keyin Information" section into the "Employer Notes" .

    4
    The employer has a specific verification request.
    • Change the mode of contact (MOC) to "Hold" , reason "Other"

    • Input the specific request in "Employer Notes"

    • Elevate to lead for assignment to TE

    5
    The fax Indicates "No Employees" for the entire processing year and/or prior year
    • Follow the instructions in IRM 25.25.3.7, Completing the Call

    6
    For faxes that have been sent to the wrong business.
    • Follow Fax Phone Procedures. See IRM 21.1.3.2, General Disclosure Guidelines

Manual Verification Procedures

  1. Income documents (IDOC) meeting certain criteria must be manually verified. These may include returns with any of the following:

    • Unsubstantiated income or withholding

    • Taxpayer inquiries via an Operation Assistance Request (OAR)

    Note:

    If an Employer Identification Number (EIN) has previously been deemed Suspicious/Bogus, then manual verification is not needed and the return can be pushed to scheme.

  2. If the Letter 4464C, Questionable Refund 3rd Party Notification, was not previously sent and contact with the employer is necessary, take the following actions:

    1. Send the Letter 4464C and use the return address code "SF" and signature code "BB" for the IVO Director.

    2. Input a TC 971 / AC 617 on CC TXMODA.

    3. If the refund needs to be stopped, see IRM 25.25.2.4, Stopping / Releasing the Refund.

    4. Allow 10 days from the date the letter was sent before contacting the employer.

    Note:

    The procedure for waiting 10 days is designed to comply with IRC 7602(c), Notice of Contact of Third Parties, which states IRS employees are prohibited from contacting persons other than the taxpayer about the collection or determination of tax without first giving the taxpayer a reasonable notice that such contacts may be made.

    Reminder:

    Taxpayers in hardship situations can provide oral authorization for third-party contact. If the taxpayer gave their oral consent to Taxpayer Advocate Service (TAS), it needs to be reflected on the OAR.

  3. At the end of the of the 10 day waiting period, initiate the verification process.

  4. Perform research using Exhibit 25.25.3-3, Research Check Sheet.

  5. If an EIN is in contact employer (CE), check the mode of contact (MOC) prior to making contact with the employer. If MOC cannot be determined, contact the employer to determine the preferred MOC.

  6. If the employer is willing to complete the verification process while on the phone, update CE and return notes with any pertinent information and Include the following:

    • Who you spoke with from the company

    • Title and phone number

    • All verifications results such as; "Not employed" , "Verified OK" , "Incorrect dollars" (include wage/withholding amounts verified), and "UTV (if unable to verify)" , see IRM 25.25.3.13, Unable to Verify (UTV) Procedures

  7. If the employer requests a fax, prepare a Manual Fax and fax to the employer at the fax number provided.

  8. If the Permanent Instructions in CE indicates "IVO has Disc information" , send a verification request via secure e-mail to *W&I-AMTAP-CSC Disc Verification mailbox. Include the following information in the secure e-mail:

    • Employer name that is to be verified based on research

    • Employer EIN that is to be verified based on research

    • Employee name(s) and social security number(s) (SSN) to be verified

    • Tax year to be verified

    • Name of the tax examiner (TE) verification is being sent back to

  9. If the employer requires a Spanish speaking representative to perform the verification process, send a verification request via secure e-mail to the Spanish mailbox *W&I-AMTAP-FSC Spanish. If the employer has an International telephone number, send a verification request via secure e-mail to the International mailbox *W&I-AMTAP-FSC International. Once verification is completed, the designated site will disposition the return accordingly. The secure e-mail is to include the following information:

    • Employer name to be verified based on research

    • Employer EIN that to be verified based on research

    • Employee name(s) and SSN(s) to be verified

    • Tax year to be verified

  10. When verification has been completed for all IDOCs and/or unsubstantiated withholding, take the following actions:

    • If the IDOC verifies as "Good" , manually release the refund per IRM 25.25.2.4, Stopping / Releasing the Refund, disposition the return to "Refile" and update the Electronic Fraud Detection System (EFDS) notes as appropriate.

      Note:

      If the return is in STARS, update the return disposition to "CL" and add the return information to the STARS delete listing to have it removed from STARS.

    • If the IDOC verifies as "False" , disposition the return to "Add to Scheme" , see IRM 25.25.2.5, Adding to Scheme, for adding to scheme procedures. Update EFDS notes appropriately.

    • Input/Update AMS notes as appropriate per IRM 21.2.2.4.5, Account Management Services (AMS).

  11. There may be instances when verification cannot be made. See IRM 25.25.3.13, Unable to Verify (UTV) Procedures, for UTV definitions. If a UTV note is used, input all required notes and submit to Lead for review.

  12. If research indicates a possible Bogus EIN or a company with no employees, complete the following steps:

    • Input a note indicating the research performed in the "Employer Notes" field.

    • Set the MOC to "Hold" , reason "Bogus Determination" .

Updating Employer Disc Verification via Excel Spreadsheet

  1. The mode of contact (MOC) for all Employer Identification Numbers (EINs) on the Disc Verification Spreadsheet should appear as "Hold" , reason "Management" in Contact Employer (CE).

  2. The following actions need to be completed when updating Disc Verifications:

    1. Designated tax examiners (TE) will receive from either the lead or manager a list of daily assigned Disc verifications.

    2. The TE will access the Master Disc Verification Spreadsheet Log and locate each assigned EIN. The TE will need to confirm the information is available, check the location of the employer information, password and additional search information on the Master Disc Verification Log Spreadsheet to work the verifications.

  3. Access the location of the payer data for each EIN, (i.e., Employer W2 20XX database or foldered PDF, EXCEL, Word file) as applicable, to verify each outstanding income document (IDOC) from your assigned spread sheet.

  4. Access the EIN in CE:

    1. Change the MOC to "Call OK" by answering "Yes" to the pop up box that appears. The CE record will then open for editing

    2. Select MOC: "Hold"

    3. Reason: "Management"

    4. Select the "Work Tab" in CE

    5. Sort the outstanding IDOCs by social security number (SSN)

  5. Disposition the IDOC for all SSNs from your assignment sheet:

    1. Enter your name as the verifier in the "Name" box

    2. Enter "Disc Verification" in the "Position" box

    3. Select "Not Employed" for records not found

    4. Enter the dollar amounts for records where wage and withholding amounts were indicated by the employer

    5. Select "Update"

  6. If the IDOC contains an Individual Taxpayer Identification Number (ITIN), search the original file sent by the employer for the name, ITIN and work assumed SSN, if provided. Update Electronic Fraud Detection System (EFDS) notes as required (i.e., "XX-XXXXXX Per Disc verification Not Employed by name, work assumed SSN or ITIN" or "Per Disc verification work assumed SSN is XXX-XX-XXXX").

Unable to Verify (UTV) Procedures

  1. There are times when verification cannot be completed in Contact Employer (CE), and the income document (IDOC) or Employer Identification Number (EIN) will be marked as "Unable to Verify (UTV)" . UTV reasons are divided into two categories:

    • IDOC specific

    • EIN specific

  2. Before determining an IDOC or EIN to be UTV, research must be completed using the Exhibit 25.25.3-3, Research Check Sheet.

  3. The UTV reasons listed below are IDOC specific. Any IDOC with specific unable to verify reasons will not be able to be verified through CE.

    Example:

    ("UTV-2 NAMES" will not require research from the tax examiner (TE) that finds it in CE).

    UTV Reason The UTV Description The UTV Action
    1
    Two Names (UTVNAMES)
    • The IDOC in Electronic Fraud Detection System (EFDS) has two names in the payee/taxpayer name field. (These are normally paper IDOCs that have been manually entered incorrectly into EFDS.)

    Example:

    The IDOC in CE has the payee/taxpayer listed as: Jim and Jan Smith.

    1. Add a return note in CE containing the following:

      • the EIN (XX-XXXXXXX) of the IDOC

      • "UTV-2NAMES"

      • IDOC input with two taxpayer names, forwarded to Point of Contact (POC) for correction

      • Original Mode of Contact (MOC)

    2. E-mail a screen print of the CE screen showing the 2 names in the payee/taxpayer field and forward it to your lead/manager. This will be shared with the paper site as a training issue.

    3. Change MOC to "Hold" , reason "Other" .

    4. The receiving IVO site must complete verification on all IDOCs in CE within 3 days and change the MOC back to the original MOC found in "Return Notes" .

    2
    Employer/Employee (EE)
    The IDOC to be verified is the business owner and Form 94X and/or Form 1120 are "Not" required.

    Note:

    To verify current filing requirements use CC INOLES. CC BMFOL will show if the Form 94X and/or Form 1120 are not required.

    1. Add return note: XX-XXXXXXX UTV-EE along with the research performed/results that determined the Form 94X and/or Form 1120 are NOT required.

    2. Input "UTV-EE" in the Who at the employer gave you the information" box in CE

    3. Disposition IDOC to "Employment Only" in CE

  4. The UTV reasons below are EIN specific and apply to all IDOCs for that EIN.

    UTV Name The UTV Description UTV Action Taken
    1
    Will Not Call Back (WNCB)
    The correct employer was contacted, and the employer stated they would call back, but no call is received
    • The employer must be contacted at least two times before assigning this UTV. After the second attempt the TE will complete research per Exhibit 25.25.3-3, Research Check Sheet, and follow the instructions in paragraph (5) below.

    2
    Refused (R)
    The employer refuses to complete any verifications and any subsequent verifications, or the employer will not verify without consent of taxpayer.
    • Document all information in "Employer Notes" as to why the employer is refusing

    • Explain to the employer that a letter was sent to the employee advising them of the possible third-party contact.

    • If the employer representative wishes to validate the call; provide the employer the business toll-free number 800- 829-8374.

    • Input Account Management Services (AMS) notes under the EIN, "IVO Verification Call Attempted"

    • If the employer still refuses to provide any verification, follow the instructions in paragraph (5) below.

    3
    Work Number (WN)
    The employer uses the work number and will not verify using any other method.
    • Explain that the work number does not give the federal withholding information which is one of the items we are trying to verify. (Normally someone at the business will complete the verifications if we explain what we need and how the Work Number does not provide it.)

    • If the contact person will not comply, try to find another contact person for the employer (i.e., in payroll)

    • If unable to obtain the verification, follow the instructions in paragraph (5) below.

    4
    Miscellaneous (UTV-MISC)
    This UTV is used only when the situation does not fit any other UTV category. Example: the employer cannot be found.
    • Follow the instructions in paragraph (5) below.

    5
    Invalid EIN (UTV - INVEIN)
    The BMF information area in CE is blank. (UTV-INVEIN is mainly used to allow further processing of the IDOCs that were submitted in error. See IRM 25.25.2.2, Data Mining Screening.
    • Research IDRS CC FINDED for the EIN.

    • If the EIN has been issued and the company name found on CC FINDED "matches" the IDOC company name/information; input into the "Permanent Instruction" field the following statement: "CC FINDED shows this is a valid EIN" .

    • If the EIN is valid per CC FINDED but the company name "Does Not Match" the IDOC company name/information:

      • Remove the IDOC company information that was generated into the "Employer Keyin Information" section and place it into "Employer Notes"

      • Input the company information from CC FINDED into the "Employer Keyin Information" section.

      • Input into the "Permanent Instruction" field the following statement; "CC FINDED shows this is a valid EIN. The IDOCs to be verified will follow the procedures below"

    • If EIN has "Never been issued:"

      • Follow instructions in paragraph 5 below.

      • The bogus team will treat as a "No Employees" or a "Suspicious EIN"

  5. Complete the following actions along with the above instruction for UTV-WNCB, UTV-R, UTV-WN, UTV-INVEIN or UTV-MISC:

    • Update the permanent instruction on the "Employer Info" tab to "UTV-XXXX followed by your login"

    • Update "Employer Notes" (EIN first) with "UTV-XXXX " , along with a statement outlining why this UTV reason is selected. Do not disposition the IDOC

    • Place employer in "Hold" , reason "Other" for "UTV-WNCB" , "UTV-R" , and "UTV-WN"

    • Place employer in "Hold" , reason "Possible Bogus Determination" for "UTV-MISC" and "UTV-INVEIN"

    Note:

    When CC IRPTR data for the current year becomes available for the EIN in question, the IDOCs will be verified by CC IRPTR and MOC changed back to "Call OK" .

Verification Multiple Income Documents (IDOC(s)) Partial Verification Process

  1. When multiple income documents (IDOC) are listed for an Employer Identification Number (EIN), all efforts should be made to verify all IDOCs at the same time. If the entire list cannot be completed, take the following actions to update the disposition and status for the IDOCs in the "Work" tab:

    1. For the IDOCs that have completed verification, update each IDOC disposition using IRM 25.25.3.7, Completing the Call or IRM 25.25.3.13, Unable to Verify (UTV) Procedures.

    2. Do not click "Update" until all the steps below have been completed.

    3. Highlight one of the IDOCs that need to stay in the "Work" tab.

    4. Click on the drop down arrow next to "Group Dispositions" inside the box "Who at the employer gave you the information?" , and select "Hold on Rest" from the list.

    5. A pop up window will appear to ensure you want to take this action, click on "Yes" and the window will change to the "Employer Info" tab.

    6. On the "Employer Info" tab, the mode of contact (MOC)will show as "Hold" . In the "Hold Information" section of the screen, select the reason "Call Back IRS" from the drop down menu and enter the date and time for the hold to expire.

    7. Then select "Update" .

    Note:

    The IDOCs you disposition will move into the "Completed" tab and the rest will be left under the "Work" tab.

Spanish or International Phone Calls

  1. During verification of calls that fall into the Spanish Call or International Call realm, the tax examiner (TE) should forward any specific information to the appropriate mailbox. Notify your manager via e-mail that the call requires referral to the Spanish or International mailbox.

  2. Spanish Calls - When it is determined that the IVO employee cannot communicate with the employer due to a Spanish language barrier, forward an e-mail to *W&I-AMTAP-FSC Spanish mailbox. The e-mail should include: employer name, EIN and phone number. The call should be processed as follows:

    1. Change employer mode of contact (MOC) to "Hold" , reason "Other"

    2. Input in "Employer Notes" "Spanish"

    3. Update Permanent Instruction "Spanish"

  3. International Calls - CE indicates that the employer is out of the United States, forward an e-mail to *W&I-AMTAP-FSC International mailbox. The e-mail should include: employer name, EIN, and phone number. The call should be processed as follows:

    1. Change employer MOC to "Hold" , reason "Other"

    2. Input in "Employer Notes" "International"

    3. Permanent Instruction "International"

Updating Individual Taxpayer Identification Number (ITIN) Income Documents (IDOCs)

  1. An Individual Taxpayer Identification Number (ITIN) is a nine digit number that starts with a "9" and is used to establish accounts for individuals who are required to have a U. S. taxpayer identification number but do not have, and are not eligible to obtain a social security number. The ITIN allows them to file tax returns only, it does not authorize a person to work in the United States. See IRM 3.21.263.2, Overview, for additional information.

  2. Review the information in the Electronic Fraud Detection System (EFDS) for a "work assumed" social security number (SSN). Review CC IRPTR using the "work assumed" SSN and the ITIN to locate the income document information. If no information can be located for the "work assumed" SSN or ITIN in CC IRPTR, research SSA_ORS using the ITIN, SSN, and name. Use the chart below to disposition the IDOC in Contact Employer (CE):

    IF AND THEN
    1
    The income information can be located in CC IRPTR or SSA_ORS
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    • Enter into the name position in CE, PER CC IRPTR or PER SSA_ORS, as applicable.

    • Update the IDOC disposition to "Verified OK" .

    • Follow the instructions in IRM 25.25.3.2, Verification of Income, paragraph 6 prior to dispositioning an IDOC to "Verified OK" .

    2
    The income information can be located in CC IRPTR or SSA_ORS
    Does not fall within tolerance amounts above
    • Enter into the name position in CE, PER CC IRPTR or PER SSA_ORS, as applicable.

    • Enter the wages and withholding amounts in CE.

    3
    The income information cannot be located in CC IRPTR or SSA_ORS.
    • Follow the steps in paragraph 3 or 4 to contact the employer.

    • Update CE per the employer’s response.

  3. Verification by Phone:

    1. Employees should look at the Return Notes to determine if a "work assumed" SSN was found for the taxpayer by the submitter. If there are no return notes regarding a "work assumed" SSN, the TE will need to research to try to find a "work assumed" SSN.

      Note:

      Ask the employer to research their records by TIN and by name.

    2. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

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

    5. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡

    6. Upon completion of the verification, CE will need to be updated appropriately. For example, input an EFDS Employer Note "per Employer verified by name" or "per Employer not employed by name or TIN" .

  4. Verification by Fax. The returned fax should indicate if the taxpayer was employed by name or TIN. If the employer fails to indicate on the fax by checking the boxes "No income or federal withholding by TIN" and the "No income or federal withholding by name" call the employer and ask them to check by name and TIN. Research EFDS return notes to see if a "work assumed" SSN was found.

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ " .

    • ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ ≡ " .

    • Upon completion of the verification, CE will be updated appropriately. For example, input an EFDS Employer Note "per Employer verified by name" or "per Employer not employed by name or TIN" .

Internet Research Sources

Media Type Internet sites
Websearch Search Engines http://www.google.com
http://www.yahoo.com
http://www.ask.com
http://www.excite.com
Telephone Lookups http://www.411.com
http://www.Address.com
http://www.whitepages.com
http://www.yellowpages.com
http://www.switchboard.com
http://www.superpages.com
http://www.infospace.com
http://www.dogpile.com
http://www.anywho.com
http://www.canada411.com
http://www.fonefinder.com
http://www.theultimates.com
International Country Calling Codes http://www.countrycallingcodes.com
Area Code Lookups http://www.area-codes.com
Zip Code Lookups http://www.usps.com
http://www.zip-codes.com
Toll-Free http://www.inter800.com
Fax Number Search http://fax.addresses.com
Company Contacts http://www.gethuman.com
People and Company Finder http://searchbug.com
People Search http://www.dvorak.org/phonelinks.htm
http://www.Zabasearch.com
http://www.accurint.com
http://www.nass.org
County Recorders/Clerk/Deeds http://www.allthingspolitical.org/county_recorders/county_recorders.htm
Corporation Search http://www.BlackbookOnline.info
http://www.Manta.com
http://www.us.bbb.org
http://www.accurint.com
NAICS codes http://www.census.gov/epcd/www/naics.html
Multiple Search Engines Corporation and Business Filings/People Finder http://www.publicrecordcenter.com
Merlin Information Services http://www.merlindata.com
Free Mega Search Engine http://www.dogpile.com
http://www.ixquick.com
http://www.search.com
Public Records http://www.publicrecordcenter.com/
Prisoner Research http://www.ancestorhunt.com/prison_search.htm

Note:

Use the free search links below the heading "Prison Inmate Search by State"

Common Abbreviations

Abbreviation Term Abbreviation Term
ACCT accounting, account LVM left voice mail
ADDR address MGR manager
ADMIN administrative, administrator, administration MISC miscellaneous
AGCY agency MSG message
AR accounting rep NBR number
ASSOC associate NM name
ASST assistant ORG organization
ATTN attention OW owner
BKKPR bookkeeper MGT management
BUS business PC phone call
CB call back PRES President
CL clerk PSNL personnel
CMPL complete PYRL payroll
CNFD confidential QSTN question
REC records, record
CO company RECV receive
CONT continue RESP response
CONTR controller SEC secretary
SR senior
CONVR conversation SPEC specialist
COORD coordinator SRC source
CTCT contact SSN social security number
CORP corporation, Corporate STD standard
DEPT department SUPR supervisor
DIR director SYS systems
DISC CD with employee records TA tax analyst
TECH technician
DSP disposition taxpayer taxpayer
EE employee TRE treasurer
EMPLMT employment TS tax specialist
ER employer TT trustee
EX example TXPD tax period
EXEC executor, executive VERF verify
FIN finance, financial VP vice president
FLR floor W/H withholding
GOVT government WCB will call back
HR human resources WP white pages
HRD HR director XPDT expedite
LD lead
LM left message YR year
LV leave YTD year-to-date

Research Check Sheet

Research Results
IDRS CC research on business
BMFOLP - (Payments under EIN)
BMFOLI - (Filing history under EIN)
BMFOLL - (Indication of Final Form 94X)

Note:

If you have reason to believe this is a possible bogus company based on the above research, complete the following steps:
Input a note into the "Employer Notes" field and include all research
Set the MOC to "Hold" , reason "Bogus Determination" Otherwise, if the company is making payments and/or filing returns, continue with the research below.

Contact Employer information Research
Employer Keyin Information Section
Completed Tab (Name/Title and Phone number)
BMF area phone number
IDRS CC research on EIN
INOLE S and T definer
ENMOD
TRDBV
IDRS CC research on business owner or XREF found in previous EIN research (if applicable)
TRDBV
IRPTR
Internet Research
Business Search (Secretary of State)
Google
White Pages 411.com or other phone search
Other MISC internet research
Accurint research