3.12.263 Estate and Gift Tax Returns

Manual Transmittal

November 16, 2017

Purpose

(1) This transmits revised IRM 3.12.263, Error Resolution, Estate and Gift Tax Returns.

Material Changes

(1) Minor editorial changes have been made throughout this IRM (e.g., line number updates, spelling, punctuation, unspan cells, links, etc.). Other significant changes to this IRM are shown below.

(2) IRM 3.12.263.1 Program Scope and Objectives - Moved from 3.12.263 and Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2

(3) IRM 3.12.263.1.1 Background - Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2.

(4) IRM 3.12.263.1.2 Authority - Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2

(5) IRM 3.12.263.1.3 Responsibilities - Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2

(6) IRM 3.12.263.1.4 Program Management and Review- Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2

(7) IRM 3.12.263.1.6 Terms, Definitions/Acronyms - Moved from 3.12.106.2.4 and Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2

(8) IRM 3.12.263.1.7 Interpretation Words - Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2.

(9) IRM 3.12.263.1.8 Related Resources - Added to Internal Controls section as outlined in IRM 1.11.2.2.5 and IRM 1.11.2.6.1.2.

(10) IRM 3.12.263.2 Added instruction for processing Early File Form 706 January 1 through June 15 of each year.

(11) IRM 3.12.263.3.1.1 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(12) IRM 3.12.263.3.1.3 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(13) IRM 3.12.263.3.1.6 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(14) IRM 3.12.263.3.12.1 Added to make sure you use TPNC90 (1) placed the words when no other in bold.

(15) IRM 3.12.263.4.6 Updated If/Then (4) with examples for current year date of death.

(16) IRM 3.12.263.5.2 Updated Error Record Format Section 2 with the following Changed wording 0209C from Exclusion Amount to Restored Exclusion Amount, Changed wording to 0209D from Credit Amount to Exclusion Amount, Added information for 0209E, updated 0211 to match 0209.

(17) IRM 3.12.263.5.17 Changed title to Restored Exclusion Amount from Exclusion Amount

(18) IRM 3.12.263.5.18 Added Line 0209E instructions Applicable Credit Amount.

(19) IRM 3.12.263.5.18.1 Added Invalid Condition Code for Line 0209E Instructions.

(20) IRM 3.12.263.5.18.2 Added Correction procedures for 0209E Applicable Credit Amount.

(21) IRM 3.12.263.5.19 Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(22) IRM 3.12.263.5.21 Changed Wording to Applicable Credit Amount, updated line 0209d to 0209e.

(23) IRM 3.12.263.5.23 (4) updated wording to match tax law.

(24) IRM 3.12.263.8 Updated Martial status to include: This needs to be 1, 2, 3, 4 or 5 based on the marital status. (IPU 17U1251 issued 08/16/2017)

(25) IRM 3.12.263.10.18 Update the instructions to say "The full date is required (yyyyddmm) in this field" placed in front of Check for Coding and Transcription error and correct. (IPU 17U1251 issued 08/16/2017)

(26) IRM 3.12.263.13.20.2 Added suggested wording for TPNC 90 taken from Job aid. to the If/then chart.

(27) IRM 3.12.263.13.25 Update wording 0209C from Applicable to Restored, Updated 0209D wording from Credit Exclusion to Applicable Exclusion and added 0209E information.

(28) IRM 3.12.263.13.26.2 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(29) IRM 3.12.263.13.27 Updated Wording from Credit Exclusion to Applicable Exclusion title changed wording 0209C from Applicable to Restored, change wording 0209D from Applicable Credit to Applicable Restored, Added 0209E Applicable Credit Amount.

(30) IRM 3.12.263.13.27.1 Updated wording from Credit Exclusion to Applicable Credit amount.

(31) IRM 3.12.263.13.27.2 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(32) IRM 3.12.263.13.30.2 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(33) IRM 3.12.263.13.31.2 Removed the word also from the suggested wording for TPNC 90. In the If/then chart.

(34) IRM 3.12.263.15.9 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(35) IRM 3.12.263.18.19.3 Added suggest wording for TPNC 90 for consistency throughout IRM as well as notices being sent. (IPU 17U0914 issued 05-26-2017)

(36) IRM 3.12.263.18.22.3 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(37) IRM 3.12.263.18.24.2 Removed the word also in suggested wording for TPNC 90 for consistency throughout IRM and to get the Job aid for TPNC 90 updated with this wording also. (IPU 17U0914 issued 05-26-2017)

(38) IRM 3.12.263.18.32.2 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(39) IRM 3.12.263.19.2.17 Removed the citation around the word form 709 (a) and (b) This is instructions for TPNC 90 and the emphasis is not needed here. (IPU17U0914 issued 05-26-2017)

(40) IRM 3.12.263.19.2.18 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(41) IRM 3.12.263.19.3.4 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(42) IRM 3.12.263.19.3.4 Added suggested TPNC 90-91 to (4) (c) for consistency throughout IRM. (IPU17U0914 issued 05-26-2017)

(43) IRM 3.12.263.19.4 Update Section 3 0307 wording to say Restored Exclusion Amount, from Maximum Applicable Credit.

(44) IRM 3.12.263.19.4.8 Updated wording on 0307 to Restored Exclusion Amount from Maximum Applicable Credit.

(45) IRM 3.12.263.19.4.11 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(46) IRM 3.12.263.19.4.14 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(47) IRM 3.12.263.19.4.18 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(48) IRM 3.12.263.22 Changed 0703 Wording to say Restored Exclusion Amount from add lines 1 and 2 Changed 0704 to Applicable Exclusion Amount add lines 1, 2 and 3. Added 0705 Applicable Credit Amount.

(49) IRM 3.12.263.22.9 Changed 0703 to Restored Exclusion amount from Add Lines 1 and 2.

(50) IRM 3.12.263.22.10 Changed 0704 to Add lines 1,2 and 3 Applicable Exclusion Amount.

(51) IRM 3.12.263.22.11 Added 0705 Applicable Credit Amount.

(52) IRM 3.12.263.23.20.2 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(53) IRM 3.12.263.23.22.2 Updated TPNC 90-91 wording removed wording for consistency in IRM and also the TPNC 90 Job aid. (IPU17U0914 issued 05-26-2017)

(54) IRM 3.12.263.23.22.2 Updated wording to TPNC 90-98 (2) (c), (6) (f) wording did not match the TPNC Job aid.(IPU17U0914 issued 05-26-2017)

(55) IRM 3.12.263.23.23.2 Removed citation around Form 709 (4) (c)this part of TPNC instruction and is not needed. (IPU17U0914 issued 05-26-2017)

(56) IRM 3.12.263.23.23.2 Update (8) TPNC 90-93 to include wording from TPNC 90 Job aid. (IPU17U0914 issued 05-26-2017)

(57) IRM 3.12.263.23.23.2 Updated (17) (a) to show TPNC 90-92 for consistency in IRM and to follow TPNC Job Aid. (IPU17U0914 issued 05-26-2017)

(58) IRM 3.12.263.23.23.2 Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(59) IRM 3.12.263.23.24.2 Removed citation around Form 709 (4) (a) this instructions for TPNC and is not necessary in this portion of the IRM. (IPU17U0914 issued 05-26-2017)

(60) IRM 3.12.263.23.24.2 Updated TPNC 90-88 (4) (b) Caution with the correct wording from the TPNC 90 Job aid. (IPU17U0914 issued 05-26-2017)

(61) IRM 3.12.263.23.25.2 Update (4) (b) with TPNC 90 wording to match TPNC 90 Job aid deleted previous wording. For consistency in the IRM and the TPNC Job aid. (IPU17U0914 issued 05-26-2017)

(62) IRM 3.12.263.23.25.2 Update the Caution (4) Changed the language for TPNC 90-91 to match the TPNC Job aid. (IPU17U0914 issued 05-26-2017)

(63) IRM 3.12.263.23.26.2 Removed citation around Form 709 (4) (a) this instructions for TPNC and is not necessary in this portion of the IRM. (IPU17U0914 issued 05-26-2017)

(64) IRM 3.12.263.23.31.2 Updated the TPNC 90-87 language to match the TPNC 90-87 Job aid. (IPU17U0914 issued 05-26-2017)

(65) IRM 3.12.263.23.35.2 Updated TPNC language to match TPNC 90 Job aid. (IPU17U0914 issued 05-26-2017)

(66) IRM 3.12.263.23.35.2 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(67) IRM 3.12.263.23.36.2 Updated (4) (b) TPNC 90-95 language to match TPNC 90 Job aid. (IPU17U0914 issued 05-26-2017)

(68) IRM 3.12.263.23.37.2 Updated (3) TPNC 90-95 language to match TPNC 90 Job aid. (IPU17U0914 issued 05-26-2017)

(69) IRM 3.12.263.23.39.2 Updated (3) (b) TPNC 90-89 language to match TPNC 90 Job aid. Removed citation from F709 this is not necessary in this portion of the IRM this is TPNC instructions. (IPU17U0914 issued 05-26-2017)

(70) Exhibit 3.12.263-6 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

(71) Exhibit 3.12.263-14 - Updated instruction and table to reflect Basic Exclusion, Applicable Credit and Gift Tax Annual Exclusion amounts for 2017 processing. (IPU 17U0053 issued 01-06-2017)

Effect on Other Documents

IRM 3.12.263, dated November 9, 2016, (effective January 1, 2017) is superseded. The following IRM Procedural Updates (IPUs) are incorporated in this revised IRM: 17U0053 (issued 01-06-2017), IPU 17U0914 (issued 05/26/2017) and IPU 17U1251 (issued 08/16/2017).

Audience

Wage and Investment (W&I), Submission Processing - Input Correction Operation, Error Resolution

Effective Date

(01-01-2018)

Linda J. Brown
Director, Submission Processing
Wage and Investment Division

Program Scope and Objectives

  1. This section contains procedures for correcting errors made on certain estate and gift tax returns processed through the Error Resolution System (ERS).

  2. Estate tax returns ( Form 706, United States Estate Tax Returns) are filed by the estates of individuals who have more than a specified amount of assets at death and/or have given significant gifts during life.

  3. Gift tax returns ( Form 709, United States Gift (and Generation-Skipping Transfer) Tax Returns) are filed by the individuals (donors) who gave the gifts and are responsible for paying the gift tax. However, if the donor does not pay the tax, the person receiving the gift (donee) may have to pay the tax. If a trust, estate, partnership, or corporation makes a gift, the individual beneficiaries, partners, or stockholders are considered donors and may be liable for the gift and Generation-Skipping Transfer (GST) taxes

  4. Purpose: All three taxes exist for the same reason, to tax the transfer of wealth

  5. Audience: Error Resolution:

    • Supervisory Tax Examining Assistant

    • Lead Tax Examining Technician

    • Tax Examining Technician

    • Clerk

    • Lead Clerk

    • Supervisory Clerk

    • Program Manager, Error Resolution

    Rejects:

    • Supervisory Tax Examining Technician

    • Technician Lead Tax Examining Technician

    • Tax Examining Technician

    • Clerk

    • Lead Clerk

    • Supervisory Clerk

    • Program Manager, Error Resolution

  6. Policy Owners:

    • Director, Submission Processing

  7. Program Owner:

    • Paper Processing Branch, Business Master File (BMF) section

  8. Primary Stakeholders:

    • Accounts Management (AM)

    • Small Business/Self-Employed (SBSE)

    • Large Business and International (LB&I)

    • Chief Financial Officer (CFO)

    • Tax Payer Advocate (TAS)

    • Chief Counsel

    • Information Technology Programmers (IT)

    • Statistics of Income (SOI)

    • Tax Exempt/Government Entities (TEGE)

    • Compliance

    • Modernized E-File (MEF)

    • Submission Processing (SP)

Background

  1. Error Resolution is to resolve validity errors, field errors, consistency errors, and math errors in returns and other documents for posting to the Master File. Records fall out in Error Resolution System (ERS) due to the Generalized Mainline Framework (GMF). The entries from transcription are transferred to ERS fields. The GMF programming causes a record to fall out to ERS if it fails to meet certain criteria, including:

    • Invalid characters in a field (e.g., numeric instead of alpha).

    • Invalid length of field ( e.g., EIN with 8 digits instead of 9)

    • Invalid codes in field (valid Action Codes, Audit Codes, etc. are programmed in GMF)

    • Consistency errors - any valid field used in any computation where the result is inconsistent with (or contradictory to) any other valid field

    • Math errors - computer does math computation and it differs from the taxpayer’s amount, and invalid tax periods and eligibility for certain credits

    Employees use the ERS system and the return to correct these conditions and when necessary use Integrated Data Retrieval System (IDRS) to research.

  2. This manual is your main source of information in correcting the record on the screen and the related return. You will also find procedures in the following Internal Revenue Manual:

    • IRM 3.12.38, Error Resolution–Business Master File (BMF) General Instructions, containing instructions for correcting records on the screen, document control, inventories and management reports

Authority

  1. Authority for procedures is found in the following sections of the Internal Revenue Code (IRC) and their corresponding Treasury Regulations IRC 6201(a):

    • The Protecting Americans from Tax Hikes (PATH) Act Consolidated Appropriations Act (Extenders)

    • American Taxpayer Relief Act (ATRA)

    • Foreign Account Tax Compliance Act (FATCA)

    • Revenue Reconciliation Act of 1998 (RRA 98)

    • Section 2006(a) of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015, Public Law (PL) 114-41, changed the return due dates for returns of partnerships, and C corporations

    • Taxpayer Bill of Rights (TBOR)

    Note:

    The above list may not be all inclusive of the various updates to the IRC.

  2. All Policy Statements for Submission Processing are contained in IRM 1.2.12

Responsibilities

  1. The Campus Director is responsible for monitoring operational performance for the Submission Processing campus.

  2. The Operations Manager is responsible for monitoring operational performance for their operation.

  3. The Team Manager/Lead is responsible for performance monitoring and ensuring employees have the tools to perform their duties

  4. The Team Employees are responsible for following the guidance provided in this IRM and staying abreast of the interim guidance defined as procedural updates.

Program Management and Review

  1. Program Goals: Define the objectives or goals for the program, what will be achieved by following the processes and procedures provided by this IRM. May include references and links to documents that outline program goals and objectives.

    • Correct any errors that are identified using the Error Resolution System (ERS).Access server, which has a login program control

  2. Program Reports: System control reports are on the Control-D WebAccess (CTDWA) and a general listing of the reports are located in IRM 3.12.38, Error Resolution, BMF General Instructions

  3. Program Effectiveness: How the program goals are measured. It is not intended to provide instruction for determining the program effectiveness. These documents may include links to program and quality reviews.

    • Embedded Quality Submission Processing (EQSP)

    • Balanced Measures

    • Managerial reviews

  4. Annual Review: Review the processes included in this manual annually to ensure accuracy and promote consistent tax administration. This may be included under Responsibilities for a manager.

  5. Federal Managers Financial Integrity Act (FMFIA)

Program Controls

  1. Quality Review conducts a statistical valid sample size review of completed work to ensure IRM guidelines are followed.

Terms/Definitions/Acronyms

  1. This table below provides a list of acronyms used throughout this IRM 3.12.263:

    Acronyms and Abbreviations

    Acronym Definition
    AC Action Code
    ADP Automatic Data Processing
    AIMS Audit Information Management System
    APO Army Post Office
    BMF Business Master File
    CADE Customer Account Data Engine
    CAF Centralized Authorization File
    CC Command Code
    CCC Computer Condition Code
    C&E Code and Edit
    CI Criminal Investigation
    CID Criminal Investigation Division
    CL Clear Code - A field labeled “CL” is shown for the entry of a Clear Code on records where a charge or correction may not be needed).
    CSPS Cincinnati Submission Processing Center
    DLN Document Locator Number
    DPO Diplomatic Post Office
    DSUE Deceased Spouse Used Exclusion
    DSSN Donor's Social Security Number
    DOD Date of Death
    EIF Entity Index File
    EIN Employer Identification Number
    ERS Error Resolution System
    ETIP Estate Tax Inclusion Period
    Exam Examination
    FPO Fleet Post Office
    GMF Generalized Mainline Framework
    GST Generation Skipping Tax
    ICS Integrated Collection System
    IDRS Integrated Data Retrieval System
    IRC Internal Revenue Code
    IRM Internal Revenue Manual
    ISRP Integrated Submission and Remittance Processing
    LB&I Large Business and International
    MCC Major City Codes
    ME Math Error
    MF Master File
    NAP National Accounts Profile
    NC Notice Code
    NMF Non Master File
    NR Notice Review
    OLNR On Line Notice Review
    P&A Planning and Analysis
    PDS Private Delivery Service
    PIC Penalty and Interest Code
    POA Power of Attorney
    PSPC Philadelphia Submission Processing Center
    PSSN Primary Social Security Number
    PTIN Preparer’s Tax Identification Number
    QDT Qualified Domestic Trust
    RCD Received Date
    RDD Return Due Date
    RMIT Remittance
    RPS Remittance Processing System
    SB/SE Small Business/Self Employed
    SCAMPS Service Center Automated Mail Processing System
    SERP Servicewide Electronic Research Portal
    SFR Substitute For Return
    SLA Service Level Agreement
    SSA Social Security Administration
    SPC Submission Processing Center
    SSN Social Security Number
    SSSN Secondary Social Security Number
    SSPD Suspend
    TAS Taxpayer Advocate Service
    TBOR Taxpayer Bill of Rights
    TC Transaction Code
    TE/GE Tax Exempt/Government Exempt
    TIA Tax Information Authorization
    TIN Taxpayer Identification Number
    TPNC Taxpayer Notice Code
    TRS Transcript Research System
    TXPD Tax Period
    W&I Wage and Investment

Interpretation Words

  1. The table lists Interpretation words and their definitions:

    Word Definition Example of using a word that is open to interpretation: (This column is for Illustration purposes only)
    Fair Provide accurate and professional service to all persons without regard to personal bias. Treat the customer in a fair manner when working with FOIA requests.
    Usually Provide the exceptions when something is not required or what would create the unusual circumstance. Pay adjustments will be accomplished within a reasonable amount of time, usually within two (2) pay periods.
    Timely Provide the time frame to consider what is or is not timely. Process all IMF adjustments in a timely fashion.
    Significant entry Any entry other than zero or blank. For example: If line 1 has a significant entry. Edit CCC A.

Related Resources

  1. Submission Processing Home page is designed to meet the needs of our employees in addition to:.

    • Servicewide Electronic Research Program (SERP)

    • Submission Processing Design Center (SPDC)

    • Integrated Data Retrieval System (IDRS)

    • ERS only - Integrated Automation Technologies (IAT)

General Information

  1. This section tells you how to correct errors made on certain estate tax returns by both taxpayers and by campus processing. These errors will be shown on the Error Resolution System (ERS). Error Resolution errors are corrected directly on terminal display screens rather than using paper error registers. There will be no basic change to the flow of work through the campus pipeline.

  2. The general subsection covers the returns listed in items (a) through (c), below. If general and specific instructions conflict, follow the specific instructions. The forms for which Error Resolution text instructions are provided in this manual are listed as follows:

    1. Form 706, United States Estate Tax Return, is filed for estates of citizens or residents of the United States.

    2. Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return (Estate of nonresident not a citizen of the United States), is filed for estates of nonresidents who are not citizens of the United States.

    3. Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, is filed to report the tax applied to any gift, or transfer by gift of real or personal property that the taxpayer made directly or indirectly, in trust, or by any other means to a donee. It applies not only to taxes applied to the gratuitous transfer of any kind of property, but also to sales or exchanges where money or money's worth is exchanged, but the value of what is sold or exchanged exceeds the value in money or money's worth of the consideration given therefore. The gift tax is, in addition to any other tax, such as Federal income tax, paid or due on the transfer. The Document Code for Form 709 is 09, the Tax Class is 5 and the Master File Tax (Class) Code (MFT) is 51.

  3. Estate and Gift Tax, Estate Tax and Gift Tax. All three taxes exist for the same reason, to tax the transfer of wealth.

  4. See Figure 3.12.263-1, DLN, for information on the Document Locator Number (DLN). The Document Code for Form 706, is 5 and the Tax Class is 6; for Form 706-NA the Document Code is 5 and the Tax Class is 5. The Master File Tax (Class) Code (MFT) is 52 for both forms.

    Figure 3.12.263-1

    This is an Image: 33741001.gif
     

    Please click here for the text description of the image.

  5. It may be necessary to refer to instructions in the following IRMs:

    • IRM 3.11.106, Estate and Gift Tax Returns

    • IRM 3.12.38, BMF General Instructions

    • IRM 3.24.106, Estate Tax Returns

    • IRM 3.24.143, Gift Tax Returns

  6. See IRM 3.12.263.3.1, Filing Requirements and Due Dates for Form 706, United States Estate Tax Returns, IRM 3.12.263.3.1.5, Filing Requirements and Due Dates for form 706-NA, U.S. Estate ( and Generation-Skipping transfer) Tax Return, and IRM 3.12.263.3.1.6, Filing Requirements and Due Dates for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Returns, for information on who needs to file these returns.

  7. Hold any Form 706, United States Estate Tax Return with a date of death for current January to June of said year (January 1, 2018 to June 15, 2018).

  8. Error Resolution (ERS) do the following:

    • ERS SSPND 410 to the Team Lead

    • The Team Lead, will take the return to Team 101 to be re-suspended and placed in the early file suspense/future holds basket until they are notified by Headquarters.

  9. REJECTS, Hold any Form 706, United States Estate Tax Return with a date of death for current January to June of said year (January 1, 2018 to June 15, 2018). do the following:

    • DO NOT PROCESS

    • SSPND the returns under Action Code 480 (early file suspense) notation "EXT"

    • Batch and hold together according to Julian Date

    • Shelve or place on batch carts ready to be activated for processing when notified by Headquarters.

    • Planning and Analysis (P&A) Analyst should retain daily and/or weekly counts to provide to Headquarters when requested.

    • It would be best to batch these forms in refund/non-refund batches so Planning and Analysis (P&A) can keep track of any 45 day jeopardy refund returns.

Organization of Text

  1. This text is structured to give you corrective procedures and help you find them quickly.

  2. The text is structured as follows:

    • General information on the overall concepts and procedures of the error resolution process

    • General information and concepts concerning the ERS system

    • Specific instructions for correcting individual fields

    • Specific instructions for correcting consistency and math errors

    • Specific instructions for manually computing returns when required

    • An exhibit section with frequently used codes with explanation

  3. This text provides enough information to correct most error conditions. You may sometimes need to see the instructions in IRM 3.11.106, Estate and Gift Tax Returns. If there is any difference between the instructions contained in IRM 3.11.106, Estate and Gift Tax Returns and those in IRM 3.12.263, Error Resolution-Estate and Gift Tax Returns. follow the instructions contained in IRM 3.12.263, Error Resolution-Estate and Gift Tax Returns and contact the analyst responsible for IRM 3.11.106. Estate and Gift Tax Returns and IRM 3.12.263, error Resolution-Estate and Gift Tax Returns, using local procedures.

Business Master File (BMF) Consistency

  1. The purpose of the BMF Consistency initiative is to achieve consistency in the BMF Error Resolution System (ERS) processing IRMs.

  2. Topics for BMF Consistency have been identified and developed as a coordinated effort between Cincinnati, Ogden, and Wage and Investment (W&I) (Paper Processing Branch, BMF Code and Edit/ERS Section).

  3. BMF Consistency sections are identified by a "♦" (diamond) before and after the section title.

  4. The text in normal print within a consistency section signifies the common processes to be used for all BMF returns. The text in bold print is form-specific and applies to this IRM only.

Forms/Routing Guide

  1. The forms listed below are used or referred to in estate and gift tax return processing:

    Note:

    Attachment must contain name, address, Social Security Number (SSN) and an IRS Received Date. Enter if missing. If there is an attached form for another taxpayer, including spouse, or another tax period, review to determine if it is a copy. If it is not a copy, detach and route appropriately for processing.

    Form/Document Title Detach Action
    Form 56 Notice Concerning Fiduciary Relationship Yes Prepare Form 10886, Reject Routing Slip, and send to Entity.
    Form 706 U. S. Estate Tax Return No  
    Form 706-A United States Additional Estate Tax Return No  
    Form 706-CE Certificate of Payment of Foreign Death Tax No  
    Form 706-D United States Additional Estate Tax Return for Under Code Section 2057 No Note: Form 706-D, like Form 706-A, is filed separately from other Form 706 series returns. Both are Non-Master File (NMF) forms, processed through Code and Edit and Accounting.
    Form 706-GS(D) Generation-Skipping Transfer Tax Return For Distributions No  
    Document 706-GS(D) Notification of Distribution From a Generation-Skipping Trust No  
    Form 706-GS(T) Generation-Skipping Transfer Tax Return For Terminations No  
    Form 706-NA U.S. Estate (and Generation-Skipping Transfer) Tax Return (Estate of nonresident not a citizen of the United States) No  
    Form 706-QDT U.S. Estate Tax Return for Qualified Domestic Trusts No  
    Form 706 Schedule PC Protective Claim for Refund No Make a copy of Sch PC, Form 10886, Reject Routing Slip, and send to Compliance Services, Estate and Gift Tax Campus Operation.
    Form 709 Schedule S Increased Estate Tax on Excess Retirement Accumulations No  
    Form 709 United States Gift (and Generation-Skipping Transfer) Tax Return No  
    Form 712 Life Insurance Statement No  
    Form 813-A Recapitulation of Document Registers No  
    Form 843 Claim for Refund and Request for Abatement Yes Prepare Form 10886, Reject Routing Slip, and send to Compliance Services, Estate and Gift Tax Campus Operation.
    Form 1127 Application for Extension of Time for Payment of Tax Due to Undue Hardship Yes Prepare Form 10886, Reject Routing Slip, and send to Compliance Services, Estate and Gift Tax Campus Operation.
    Form 1310 Statement of Person Claiming Refund Due a Deceased Taxpayer Yes Prepare Form 10886, Reject Routing Slip, and send to Adjustments.
    Form 1332 Block and Selection Record No  
    Form 2350 Application for Extension of Time To File U.S. Income Tax Return No  
    Form 2758 Application for Extension of Time To File Certain Excise, Income, Information and Other Returns No  
    Form 2848 Power of Attorney and Declaration of Representative Yes
    1. Domestic address - Route to Memphis CAF (Centralized Authorization File) at:
      Internal Revenue Service
      PO Box 268, Stop 8423
      Memphis, TN 38101-0268. Foreign (International) address - Route to Philadelphia CAF.

    2. Foreign (International) Address - send to Philadelphia CAF function.

    Form 3465 Adjustment Request No  
    Form 3696 Correspondence Action Sheet No  
    Form 3696-A IDRS Correspondence Action Sheet No  
    Form 3753 Manual Refund Posting Voucher No  
    Form 3893 Re-Entry Document Control No Stays on the front of return.
    Form 4349 Computation of Estate Tax Due with Return and Annual Installment No See IRM 3.12.263.3.2.1, Installments and Form 4349.
    Form 4422 Application for Certificate Discharging Property Subject to Estate Tax Lien Yes Send to DO (District Office) Examination.
    Form 4768 Application for Extension of Time To File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes Yes
    1. To file:
      send to Audit Support.

    2. To pay:
      send to Compliance Services, Estate and Gift Campus Operation.

    Form 4810 Request for Prompt Assessment UnderIRC 6501(d) Yes Send original Form 4810, Request for Prompt Assessment and copy of Page 1, Form 709, United States Gift (and Generation Skipping Transfer) Tax return, on Form 10886, Reject Routing Slip, to Compliance Services, Estate and Gift Tax Campus Operation.
    Form 4868 Application for Automatic Extension of Time To File United States Individual Income Tax Return No  
    Form 5347 Examination Multiple Request Master File Yes Prepare Form 10886, Reject Routing Slip, and send to Compliance Services, Estate and Gift Tax Campus Operation.
    Form 5495 Request for Discharge from Personal Liability UnderIRC 2204 or IRC 6905 No Form 5495, Request for Discharge from Personal Liability, should stay attached to the return. If the form comes in by itself, then it should be sent to Estate and Gift Tax Mail Stop 824 G. Using Form 10886, Reject Routing Slip.
    Form 5792 Request for IDRS Generated Refund (IGR) No  
    Form 6800 Request for Missing Information Or Papers to Complete Return No  
    Form 6882 IDRS/Master File Information Request Yes Prepare Form 10886, Reject Routing Slip, and send to Customer Service
    Form 8821 Tax Information Authorization Yes
    1. Domestic address - Route to Memphis CAF (Centralized Authorization File) at:
      Internal Revenue Service
      PO Box 268, Stop 8423
      Memphis, TN 38101-0268. Foreign (International) address - Route to Philadelphia CAF.

    2. Foreign (International) Address - send to Philadelphia CAF function.

    Form 8833 Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b) No  
    Form 8892 Application for Automatic Extension of Time To File Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return and/or Payment of Gift/GST Tax No  
    Form 8939 Allocation of Increase in Basis for Property Acquired from a Decedent Yes Prepare Form 10886, Reject Routing Slip, and send to Cincinnati Compliance Services, Estate and Gift Tax Campus Operation.
    Form 10886 Reject Routing Slip No Move to the rear of return.
    Form 706 Schedule R-1 Estate Tax Return Yes Rebatch as Program 75780 to Accounting NMF.
    Request for Acknowledgment   No No action required.

Researching OLE

  1. OLE is an On-Line Entity system designed to allow for validation of the Taxpayer Identification Number (TIN) and TIN/Name Control on-line with the Integrated Data Retrieval System (IDRS) input Command Codes (CCs). It is also designed to allow for entity research on a national basis.

  2. The national file is called National Accounts Profile (NAP) and is accessed by using CC INOLE. It is a file of all accounts nationwide. For detailed information and usage of command code INOLE, EOGEN, and SPARQ, see IRM 2.3.47, IDRS Terminal Responses.

  3. INOLE can be used to research name controls. For example, when the TIN is sent to the Master File for validation, but the name control mismatches, you must research to determine the correct name control. If information present on INOLE is consistent with information on the tax return, you can correct the error. If research does not determine the correct name control, then use other research command codes (i.e., NAMES/NAMEI) to determine a better TIN.

Business Master File On-Line and Return View

  1. Since Master File does not carry all information available on the IDRS screen displays it may be necessary to initiate IDRS research using Command Codes (CCs) such as INOLE, ENMOD, BMFOL or BRTVU.

  2. Use these CCs to research entity and/or tax data which may not be available on IDRS. In most cases, the response will appear on the screen in 5 seconds or less.

  3. Corporate Files On-Line (CFOL) CCs:

    1. BRTVU-will provide business return transaction information. The file consists of original input return data, including schedules. This return information includes Code and Edit, Error Resolution (ERS) and computer generated fields.

    2. BMFOL-will provide nationwide BMF entity and tax data information on-line for tax accounts that are in credit or debit status, and/or contain freeze conditions. It will display any tax account, even zero balance, that has not been moved to lower level. Account does not have to be a credit or a debit. It will also display a list of accounts moved to the retention register. Other accounts that are not on the retention register will be available on-line within 24 hours upon request.

Secured Returns

  1. Any returns secured by Compliance will have a Transaction Code (TC) 59X and the appropriate Closing Code (CC) input by Compliance prior to processing.

  2. These returns will be identified by a stamped or handwritten TC 59X and CC in the middle left-hand margin of Page 1 of the return.

  3. If there is a math error and taxpayer correspondence is required, SSPND with Action Code (AC) 640 to Rejects for unprocessables conditions. Rejects will void the document from the system and send the document to Compliance Services, Estate and Gift Tax Campus Operation, for further processing. DO NOT correspond with the taxpayer or executor for clarification or additional information.

    Note:

    For Estate and Gift Tax returns (Form 706 and Form 709 series), Cincinnati Submission Processing Campus (CSPC) will SSPND 370 to Compliance Services, Estate and Gift Tax Campus Operation, leaving the document in ERS.

Unprocessables Conditions-Estate Tax Returns

  1. Estate tax returns must contain specific items before they are considered persuasible. Perfect all returns to the extent possible from schedules and other attachments. The specific items needed are:

    • Decedent's Name

    • Social Security Number

    • Executor's Address

    • Signature of executor or one coexecutor

  2. If any of the above items are missing or cannot be perfected, give the return to your manager to give to the estate tax attorney.

    Exception:

    Correspond for signature of executor or one coexecutor.

    Note:

    DO NOT correspond for death certificates.

Unprocessables Conditions-Gift Tax Returns

  1. Gift tax returns need the following information:

    • Donors Name

    • Social Security Number (SSN)

    • Address

    • Signature of donor

    • Spouse's Name, if applicable

    • Spouse's SSN, if applicable

  2. The following table pertains to unprocessables conditions for an incomplete Form 709, United States Gift (and Generation - Skipping Transfer) Tax Return:

    If And Then
    Incomplete return (e.g., only page 1 and/or 2 is present)
    1. Return is unnumbered, refund, or zero-balance

    2. Information for preparation of dummy page(s) is available

    1. Prepare dummy page(s).

    2. If information is not available, correspond using Form 3696, Re-Entry Document Control, or other approved Correspondence Action Sheet.

    Incomplete return (e.g., only page 1 and/or 2 is present) Return is numbered, unnumbered, or balance due and information for preparation of dummy return is available
    1. Prepare dummy page(s).

    2. If information is not available, correspond using Form 3696, Re-Entry Document Control, Correspondence Action Sheet.

Criminal Investigation (CI) Referral

  1. Criminal Investigation (CI) investigates potential criminal violations of the Internal Revenue Code (IRC) and related financial crimes. Criminal violations of the IRC include willful attempts to evade or defeat the income tax. Criminal tax violations also include the willful failure to collect or pay over tax and false claims for refunds based on bogus return information.

  2. For returns with refund claims of $100,000,000 or more, do the following:

    Caution:

    If there is no indication Code and Edit (C&E) made a copy and sent to Criminal Investigation Referral, then see below.

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

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

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

    4. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

  3. Other Criminal Investigation Referral criteria:

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

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

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

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

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
  4. For all other Criminal Investigation Referral criteria listed in paragraph (3), do the following:

    Caution:

    If there is no indication Code and Edit (C&E) made a copy and sent to Criminal Investigation Referral, then see below.

    1. Make a copy of the return.

    2. Attach Form 4227, Intra-Sc Reject or Routing Slip, to the copy.

    3. Route the copy as indicated in the table below.

      Cincinnati Ogden
      Mail Stop 83G, Criminal Investigation (CI) Mail Stop 9001, Criminal Investigation (CI)
    4. Edit an action trail "Copy to Criminal Investigation" , or "Criminal Investigation Referral" , or similar language in the lower left corner going vertically up the side of the return.

    5. Continue processing the return.

  5. If Criminal Investigation has stamped the return, no further Criminal Investigation action is required.

  6. If the return fits other criteria (e.g., Frivolous Argument), take appropriate action.

Examination (Exam) "Funny Box"

  1. The primary objective in identifying tax returns for Examination (Exam) is to promote the highest degree of voluntary compliance. Exam will provide support and assist Submission Processing (SP) with any questionable return identified during processing. Exam has a vast multitude of programs and tolerance criteria already identified in various IRM sections. Exam does not restrict Submission Processing with the flexibility to refer questionable returns other than what is currently identified in various IRMs.

Customer Account Data Engine (CADE) 2

  1. The Customer Account Data Engine (CADE) 2 Program Office in Headquarters is charged with the primary goal to implement a single, modernized programming solution which provides daily processing of taxpayer accounts.

  2. The CADE 2 solution is comprised of several components to modernize the IRS to a daily processing environment with several Transition States.

  3. The BMF campus cycles are:

    1. Campus Cycle: Thursday - Wednesday

    2. Master File Processing: Friday - Thursday

    3. Notice Review Saturday: Monday (8+ days)

    4. Unpostables: New available Tuesday; Closing Tuesday

  4. BMF transaction posting time frames are outlined as follows:

    1. Transactions will be viewable using CFOL command codes on Saturday following the weekly Master Files processing run on Thursday.

    2. Transactions will be viewable as posted transactions using IDRS command codes on Monday, following the weekly Master File processing run on Thursday.

      Note:

      With the acceleration of the IDRS weekly analysis being performed the weekend directly after the Master File processing on Thursday, transactions will be posted instead of in pending status on Monday.

  5. Transaction posting dates will reflect a format of YYYYCCDD. YYYY will indicate the year. CC will indicate the posting cycle. For IMF transactions, the following values for DD are defined:

    • 01 = Friday

    • 02 = Monday

    • 03 = Tuesday

    • 04 = Wednesday

    • 05 = Thursday

      Note:

      BMF cycle posting dates on BMFOL will continue to reflect YYYYCC. YYYY will indicate the year. CC will indicate the posting cycle. BMF cycle posting dates in TXMOD will reflect a format of YYYYCCDD. The DD value will be 08.

IRS Employee Contacts - RRA 98, Section 3705(a)

  1. The Restructuring and Reform Act of 1998 (RRA98), Section 3705(a), provides identification requirements for all IRS employees working tax related matters. IRS employees are required to give their name and unique identification number during taxpayer telephone, face to face and written contact. In addition, a telephone number is required on all taxpayer correspondence. This will provide taxpayers with enough information to identify an IRS employee who has previously assisted with tax related matters.

  2. All IRS employees, in the field, national, and regional offices, who communicate, by telephone, correspondence, or face to face, with taxpayers, or their personal representatives, on tax-related matters, are required to provide (at a minimum) the following information:

    1. Telephone Contact: Their title (e.g., Mr., Mrs., Ms., Miss), their last name, and their badge identification (ID Card) number.

    2. Face to Face: This information should be their title (e.g., Mr., Mrs., Ms., Miss), their last name, and their badge number provided as appropriate during their conversation.

    3. Correspondence: All correspondence must include a telephone number where the taxpayer's question can be answered. In addition, manually–generated and handwritten correspondence must include their title (e.g., Mr., Mrs., Ms., Miss), their last name, and their IDRS, letter system, or ID Card (badge) number.

    4. The IDRS number and numbers for some other letter systems are automatically generated. If it is not generated, or a handwritten note is prepared, the ID Card (badge) number must be used. Toll-Free employees may also provide their location for identification purposes. E-mail and facsimiles to taxpayers on tax-related matters are considered manually-generated correspondence and must include the required information.

    5. Correspondence, whether sent directly to the taxpayer or to the taxpayer's personal representative, must contain the required information.

    6. When a taxpayer insists on speaking with a specific employee who previously handled the inquiry or request, or complains about the level of service previously provided, every attempt should be made to resolve the taxpayer's inquiry. If the issue cannot be resolved, the employee should refer the inquiry, using established procedures, to his or her manager.

    7. Correspondex letters will require a specific employee name and telephone number only if the employee initiating the correspondence is in the best position to respond to any questions that the taxpayer may have about the correspondence, or the employee is asking the taxpayer to provide additional case-related information.

    8. Otherwise, if the taxpayer does not need to contact a specific employee, the correspondence needs only an IRS telephone number and standard signature.

    9. Secretaries, receptionists, or other people who answer the telephone in functional offices need to identify themselves and should provide their badge identification (ID Card) number only if they are answering telephones which are routinely used to provide tax or account information.

    10. It is not necessary to repeat the badge ID Card number on a subsequent contact, when the nature of an employee's work involves multiple contacts with the same taxpayer, and the employee has given the taxpayer (either telephone or in-person) his or her badge ID Card number on the first contact.

    Note:

    The Taxpayer Bill of Rights adopted by IRS in June 2014 provide that taxpayers have the right to receive prompt, courteous and professional assistance in their dealings with the IRS. They are to be spoken to in a way that is easily understood and any correspondence from the IRS must be clear and understandable. They have the right to speak to a supervisor whenever quality service is not received.

Taxpayer Advocate Service (TAS)

  1. Per the Taxpayer Bill of Rights, taxpayers have the right to expect a fair and just tax system which provides taxpayers with the opportunity to have their facts and circumstances considered when it might affect their underlying liabilities, ability to pay, or ability to provide information timely. Taxpayers have the right to receive assistance from the Taxpayer Advocate Service (TAS) if they are experiencing financial difficulty or if the IRS has not resolved their tax issues properly and timely through normal channels.

  2. Refer taxpayers to TAS when the contact meets TAS criteria (see IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria), or when Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), is attached and steps cannot be taken to resolve the taxpayer's issue the same day. "Same day" includes cases that can be completely resolved in 24 hours, as well as cases where steps can be taken within 24 hours to begin resolving the issue. (See also IRM 13.1.7.4, Same Day Resolution by Operations.) When making a TAS referral, use Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), and forward to TAS in accordance with your local procedures.

Taxpayer Advocate Service (TAS) Service Level Agreements (SLAs)

  1. The National Taxpayer Advocate has reached agreements with the Commissioners of the Wage and Investment (W&I) Division, Small Business and Self-Employed (SB/SE) Division, Tax Exempt and Government Entities (TE/GE) Division, Criminal Investigation (CI), Appeals, and Large Business and International (LB&I) Division, that outline the procedures and responsibilities for the processing of TAS casework when either the statutory or delegated authority to complete case transactions rests outside of TAS. These agreements are known as Service Level Agreements (SLAs).

  2. The SLAs are located at http://tas.web.irs.gov/policy/sla/default.aspx

BMF Identification (ID) Theft

  1. BMF Identification Theft is increasing. If a tax examiner in Submission Processing (SP) Error Resolution System (ERS) finds a case with attachments or correspondence indicating the taxpayer is a victim of ID Theft:

    1. SSPND "360" to route the return to Planning & Analysis (P&A).

    2. Attach Form 4227, Intra-SC Reject or Routing Slip,(or other appropriate routing slip) with the notation "ID THEFT" .

    3. Provide the entire case to your senior/lead.

    Your senior/lead will expedite the case to the Planning and Analysis staff for referral to one of the SP BMF ID Theft liaisons. The taxpayer must indicate that they are a victim of "ID Theft" ; do not send cases that are subject to Criminal Investigation (CI), Examination (Exam) or "Fraud" review.

Use of Fax for Taxpayer Submissions

  1. Tax return information can be received via fax as part of return perfection even if a taxpayer signature is required. In circumstances where contact with the taxpayer has been made and documented, fax signatures are acceptable.

  2. Contact with the taxpayer may be by telephone or correspondence. Follow local procedures to determine which method of contact will be used.

  3. ERS examiners will indicate the fax paragraph on the Correspondence Action Sheet to advise taxpayers of the option to fax their response.

    Caution:

    Before disclosing any tax information, you must be sure you are speaking with the taxpayer or authorized representative. See the Taxpayer Authentication guidelines in IRM 21.1.3, Operational Guidelines Overview. Also, before leaving any messages on a taxpayer's answering machine, review IRM 11.3.2.6.1, Leaving Information on Answering Machines/Voice Mail. Fax procedures contained in IRM 11.3.1.11, Facsimile Transmission of Tax Information, must be reviewed prior to faxing confidential information to the taxpayer.

Frivolous Returns and Claims

  1. A frivolous argument is used for the purpose of expressing dissatisfaction with the substance, form or administration of the tax laws by attempting to illegally avoid or reduce tax liabilities.

  2. Review the return to determine whether it appears to be a frivolous return and take the following action,.

    If Then
    The return meets any of the conditions in the table below

    Caution:

    If the return shows Action Code 331 and has a Form 4227, Intra-SC Reject or Routing Slip, attached with the remarks: "Refer to Exam FRP for audit after processing" , continue to next procedure.

    Remove return from the batch and place the return in the locally designated basket for Examination, Frivolous Return Processing (FRP) for review.

    Note:

    IRM 25.25.10, Frivolous Return Program, requires Examination to expedite the return and make a determination whether it qualifies as a frivolous return within two business days. If a determination is not made within the allowed timeframe, the Examination examiner will edit Action Code 331 in the lower left margin of Form 706, U.S. Estate Tax Return, or Form 709, United States Gift (and Generation-Sharing Transfer) Tax Return, preceded with the letters "AC" .

    Examination has selected the return as frivolous, e.g., indicated by an Action Code 331 and a Form 4227, Intra-SC Reject or Routing Slip, with the remarks: "Refer to Exam FRP for audit after processing" , but sends the return for processing Continue processing the return using procedures in IRM 3.12.263, Error Resolution - Estate Tax Return. However, do not circle or void the Action Code indicating a frivolous return.

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ "≡ ≡ " ≡ ≡ "≡ ≡ ≡ ≡ ≡ ≡ " ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  3. Recognized frivolous arguments made by businesses include, but are not limited to, the examples in 25.25.10, Frivolous Return Program, shown below:

    Reason Description
    Alleged Churches/First Amendment Income from non-religious sources and may claim a vow of poverty.
    Altered Form Altering any or all line items with the intent of facilitating non-compliance with the tax laws.
    Altered Jurat/Uniform Commercial Code (UCC) 1-207 or UCC 1-308 Return contains income and deductions but the jurat has been altered or stricken. May include reference to UCC 1-207, UCC 1-308 or a statement that the return was not signed under penalties of perjury.
    Amended Returns/ Form 843, Claim for Refund or Request for Abatement. Amended return or a Form 843, Claim for Refund or Request for Abatement, filed to obtain a total refund of all taxes paid in prior years, based on a tax avoidance argument.
    C-Filings This frivolous position includes the following four categories:
    1. Files a return claiming various types of deductions, credits, or overpayments/refunds that have no relation to reality and because of their outrageous character, qualify as frivolous returns.

    2. Files a return containing the filers identifying information but does not request a refund, often lacking sufficient information to determine a tax liability.

    3. Files a return with various types of rambling dialogue and/or confusing arguments that no one could reasonably view as a good faith attempt to comply with the law.

    4. Files a return that attempts to send some type of message or protest to the IRS, but fails to include sufficient identifying information for the Service to either determine the identity of the taxpayer or correspondent or return address.

    Challenges to Authority/Due Process Questions various administrative authorities such as delegation orders, summons authority, privacy act, etc. Argues that they must be afforded a hearing or a trial before taxes can be assessed or before property can be seized.
    Challenges to Authority/Title 26 or "law" in other documents Argues that Title 26 of the United States Code is not law because it was never enacted as named.
    Collections Issues Files frivolous documents contending that various collections issues are invalid (e.g. Offers in Compromise, Collection Due Process Requests, Installment Agreements, Appeals Requests, etc.) because they are not filed and/or signed by someone with delegated authority. They may have no certificate of assessment attached, do not comply in form or content with a State or Local law, are not in a certain format or lack a valid OMB (Office of Management and Budget) number or other frivolous positions.
    Disclaimer Submits a disclaimer stating, "disclaims the liability for the tax due" , making the liability on the return zero.
    Fifth Amendment Assertion of the Fifth Amendment right against self-incrimination as a basis for not providing any financial information.
    IRS is a Private Organization/Collects Tribute, Not Taxes Argues that the IRS is an entity named the Internal Revenue and Tax Service, Inc., which was incorporated in Delaware in 1933, it is a collection agency for the Federal Reserve Bank, or is part of the United Nations and is clandestinely leading the taxpaying public into a "new world order" .
    Not a Person Argues that a taxpayer is not a "person" within the meaning of IRC Section 7701(a)(14).
    Obscene, Vulgar, Harassing Submits documents or other materials indicating that non-filing is due to dissatisfaction with tax policies or taxation in general. Often, this argument is expressed with obscene, vulgar, or crude language and characters in an extremely demeaning manner.
    Protest Against Government Action/Inaction Argues that refusal to file or pay is justified because they disagree with government policies or spending plans.
    Sixteenth Amendment Argues the Sixteenth Amendment was not properly ratified and therefore the federal government does not have the legal authority to collect an income tax without apportionment.
    Straw Men Argues the government has created an entity separate and distinct from the taxpayer - a "Straw Man" and any tax obligations are exclusively those of the "Straw Man" .
    Taxes are Voluntary/Law Does Not Require Submits a return, amended return, or correspondence that argues income taxes are voluntary.
    US vs. Long Submits a return with zero money amounts. To explain the zeroes inserted on the form, the individual references U.S. vs. Long.
    Unsigned Returns The individual completes a return but fails to sign. A statement indicating disagreement with the tax system is attached or added to the return.
    Valuation Income is not taxable because of the declining fair market value of the dollar, because the dollar is not backed by gold/silver, because the value of services is offset by the value of the labor (barter income), etc.
    Zero Returns Submits a return with zero money amounts. A statement is attached claiming there is no section of the Internal Revenue Code that established an income tax liability. The statement may also contain arguments regarding the definition of income.

    Note:

    Returns having only zeros, no entries, are blank, or indicate "None" , "Not Liable" , etc., with no evidence of frivolous arguments are not to be considered as frivolous returns.

    Other All others including those listed in Notice 2010-33 or any subsequent notice. This category includes non-filer accounts resulting from initial compliance check such as cross-reference TINs.

    Note:

    Frivolous arguments citing "Collection Due Process" (CDP) should be reviewed by Collections for possible referral to Appeals. Refer to IRM 5.19.8,Collection Appeal Rights, for additional information.

IRM Deviation Procedures

  1. IRM deviations must be submitted in writing following instructions from IRM 1.11.2.2.4, Internal Management Documents System - Internal Revenue Manual (IRM) Process, When Procedures Deviate from the IRM, and elevated through appropriate channels for executive approval.

Error Resolution System (ERS) General Information

  1. Records are placed into the Error Inventory or the workable Suspense Inventory for correction.

  2. Once you access a record and it shows on the screen, you must either:

    1. Fully correct the record.

    2. Place the record in suspense until more information is received.

    3. Reject the record from pipeline processing.

    4. Issue the appropriate Taxpayer Notice Code (TPNC).

  3. Corrections include correcting transcription, coding errors or misplaced entries, or in the case of a taxpayer math error, notifying the taxpayer of any error on the return.

  4. This manual is your main source of information for correcting the record on the screen and the related return. You will also find procedures in the following IRMs:

    1. IRM 3.12.38, General Instructions, which has general instructions for correcting records on the screen, document control, inventories and management reports.

    2. IRM 3.11.106, Estate and Gift Tax Returns, which will add instructions related to ERS processing.

    3. IRM 3.24.106, Estate Tax Returns, which has instructions for ISRP (Integrated Submission and Remittance Processing) input of estate tax returns.

    4. IRM 3.24.143, Gift Tax Returns, which has instructions for ISRP input of gift tax returns.

Filing Requirements and Due Dates for Form 706, U.S. Estate Tax Return

  1. Form 706, U.S. Estate Tax Return, for a U.S. citizen residing in the U.S., a resident alien, or a nonresident U.S. citizen whose domicile is not in the United States must be filed at CSPC.

  2. The following information pertains to the due date of Form 706, U.S. Estate Tax Return:

    1. If the decedent died after December 31, 1970, Form 706, U.S. Estate Tax Return, is due the day of the ninth calendar month after decedents death numerically corresponding to day of calendar month on which death occurred. For example, if the decedent died on May 31 of the current year, the due date is February 28 of the following year.

      Exception:

      If February 28 falls on a Saturday or Sunday, the due date would be the following Monday.

      Exception:

      If the date of death is between January 1, 2010, and December 17, 2010 (inclusively); the return due date is September 19, 2011, as mandated in the Extender's Legislation (PL 111-312).

    2. An application for extension of time for filing (Form 4768, Application for Extension of Time To File a Return and/or Pay Estate (and Generation-Skipping Transfer) Taxes), may be granted even if the application is made later than 9 months after the Date of Death (DOD). Unless the executor is abroad, the extended due date for filing estate tax return may not be later than 15 months from date of the decedents death.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the Executor of a 2010 estate who files a Form 4768, Application of extension of Time To File a Return and/or Pay Estate (and Generation-Skipping Transfer) Taxes,by the due date for filing Form 706, U.S. Estate Tax Return or Form 706-NA, U.S. Estate (and Generation -Skipping Transfer) Tax Return, both an automatic six month extension of time to file Form 706, U.S. Estate Tax Return of Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, pursuant to Section 6081, and a six month extension of time to pay the estate tax. The executor of a 2010 estate is not required to substantiate on the Form 4768, Application for Extension of Time to File a Return and Pay Estate (and Generation-Skipping Transfer) Taxes, the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768), Application for Extension of Time to File a Return and Pay Estate (and Generation-Skipping Transfer) Taxes, justification needs to be provided.

Form 706, U.S. Estate Tax Return Gross Estate
  1. Form 706, U.S. Estate Tax Return, had to be filed if the gross estate of U.S. citizens and residents exceeded the amounts in the following table. This amount increased as follows:

    Date of Death Amount
    1977 $120,667
    1978 $134,000
    1979 $147,333
    1980 $161,562
    1981 $175,625
  2. For decedents dying after 1981, the Unified/Applicable Credit and Basic Exclusion Amount for estates of citizens and residents are as follows:

    Date of Death Applicable Credit Amount Basic Exclusion Amount
    1982 $62,800 $225,000
    1983 79,300 275,000
    1984 96,300 325,000
    1985 121,800 400,000
    1986 155,800 500,000
    1987 thru 1997 192,800 600,000
    1998 202,050 625,000
    1999 211,300 650,000
    2000 and 2001 220,550 675,000
    2002 and 2003 345,800 1,000,000
    2004 and 2005 555,800 1,500,000
    2006 thru 2008 780,800 2,000,000
    2009 1,455,800 3,500,000
    2010 and 2011 1,730,800 5,000,000
    2012 1,772,800 5,120,000
    2013 2,045,800 5,250,000
    2014 2,081,800 5,340,000
    2015 2,117,800 5,430,000
    2016 2,125,800 5,450,000
    2017 2,141,800 5,490,000
  3. There is no limit to the marital deduction. Unlimited amounts of property, except for certain terminable interests, can be transferred between spouses free of estate tax.

Extension of Time for Filing
  1. Extensions of time for filing an estate tax return will be granted if the request is filed on or before the due date of the return. The extension is generally granted when it is impossible or impractical to complete the return within 9 months after the DOD and good and sufficient cause is shown. These extensions may be granted even though a request is made later than 9 months from the DOD. However, unless the executor is abroad, the extended due date for filing the estate tax return may not be later than 15 months from the date of the decedents death.

  2. Form 4768, Application for Extension of Time To File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes (Part II), is used to apply for extension of time to file. Beginning with Form 4768, Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, filed for estate tax returns due after July 25, 2001, an executor may apply for an automatic 6 month extension of time to file Form 706, U.S. Estate Tax Return, by checking the designated box and completing the form as instructed.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the executor of a 2010 estate who files a Form 4768, Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, by the due date for filing Form 706, U.S. Estate Tax Return or Form 706-NA, U. S. Estate (and Generation-Skipping Transfer) Tax Return, both an automatic six month extension of time to file Form 706, U.S. Estate Tax Return or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return pursuant to Section 6081, and a six month extension of time to pay the estate tax. The executor of a 2010 estate is not required to substantiate on the Form 4768, Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768), Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, justification needs to be provided.

  3. If original Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, for the same period in which taxpayer died is attached to the estate tax return (Form 706 ), U.S. Estate Tax Return, with approved extension to file, pull Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, enter IRS received date, and note on Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, "Extension to file Form 706, U.S. Estate Tax Return, granted to MMDDYYYY-Do not assess penalties" , Notate Computer Condition Code (CCC) "R" on the return so that no penalty will be assessed on the Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, if the Form 706, U.S. Estate Tax Return, posts after the Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return,. Route Form 709, Unites States Gift (and Generation-Skipping Transfer) Tax Return, to batching (numbering). If there is no extension to file, pull Form 706, U.S. Estate Tax Return, and enter the IRS received date.

  4. See IRM 3.12.263.2.3, Forms/Routing Guide, for additional references to additional extension forms which taxpayers may submit with their Form 706, U.S. Estate Tax Return, and Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, series returns.

Prior Revisions of Form 706, U.S. Estate Tax Return
  1. Chart below For decedents dying and revision of Form 706 needed for processing:

    After and Before Use revision of Form 706 dated
    12/31/1998 01/01/2001 July 1999
    12/31/2000 01/01/2002 November 2001
    12/31/2001 01/01/2003 August 2002
    12/31/2002 01/01/2004 August 2003
    12/31/2003 01/01/2005 August 2004
    12/31/2004 01/01/2006 August 2005
    12/31/2005 01/01/2007 October 2006
    12/31/2006 01/01/2008 September 2007
    12/31/2007 01/01/2009 August 2008
    12/31/2008 01/01/2010 September 2009
    12/31/2009 01/01/2011 July 2011
    12/31/2010 01/01/2012 August 2011
    12/31/2011 01/01/2013 August 2012
    12/31/2012 01/01/2017 August 2013
Prior Year Returns - Date of Death (DOD) January 1, 1977 or later
  1. The following information pertains to DOD January 1, 1977, or later. If a Form 706, U.S. Estate Tax Return, is filed with a revision date prior to June 1977, transfer the data in the Tax Computation section.

    1. Transfer IRS "received date" to current revision of return.

    2. After transfer of data, code and edit, staple overlay under entity portion of return.

  2. Examiners will perform the following preliminary exam:

    1. If decedent is an "expatriate" the return is not subject to tax rates of a nonresident not a citizen of the U.S., but subject to normal rates of Form 706, U.S. Estate Tax Return. A U.S. "expatriate" is one who lost U.S. citizenship within 10 years before DOD and for whom it is reasonable to assume that a main purpose in doing so was to avoid U.S. taxes. Check Line 6b on back of Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return .

    2. Under IRC 2208, a person who is a citizen of the U.S. by reason of birth in the U.S., established residence in a possession of the U.S. and died after September 2, 1958, is considered a U.S. citizen. His/her estate is subject to tax imposed by IRC 2001 and return should be Form 706, U.S. Estate Tax Return, instead of Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return . Reject with AC 610 if it is a non-remittance return. Delete "NA" from the title of form. This can be checked by looking at "Citizenship (nationality)" and "Domicile at time of death" blocks.

Filing Requirements and Due Dates for Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return
  1. Before December 31, 1976, Form 706-NA, U. S. Estate (and Generation-Skipping Transfer) Tax Return, was required for the estate of a nonresident, not a citizen of the U.S., whose gross estate situated in the U.S. exceeded $30,000 at DOD. If decedent died prior to November 14, 1966, the return was required for gross estates exceeding $2,000.

  2. After December 31, 1976, Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return is required for estate of nonresident, not a citizen of the U.S. If the part of the gross estate situated in the U.S. exceeded $60,000 at DOD reduced by:

    • Amount of adjusted taxable gifts per IRC 2201(b), made by the decedent after December 31, 1975, and,

    • Aggregate amount allowed as specific exemption per IRC 2521, (before its repeal by the Tax Reform Act of 1976) with respect to gifts made by decedent after September 8, 1976.

  3. If Pre-1977 Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return has been filed, attach current revision of form to return and enter data for transcription lines onto current form. The following information will help convert returns.

  4. The following information pertains to the due date of Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return:

    1. If the decedent died after December 31, 1970, Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, is due the day of the ninth calendar month after decedent’s death numerically corresponding to day of calendar month on which death occurred. For example, if the decedent died on May 31 of the current year, the due date is February 28 of the following year.

      Exception:

      If February 28 falls on a Saturday or Sunday, the due date would be the following Monday.

      Exception:

      If the date of death is between January 1, 2010, and December 17, 2010 (inclusively); the return due date is September 19, 2011, as mandated in the Extender's Legislation (PL 111-312).

    2. An application for extension of time for filing (Form 4768, Application for Extension of Time To File a Return and/or Pay Estate (and Generation-Skipping Transfer) Taxes), may be granted even if the application is made later than 9 months after the DOD. Unless the executor is abroad, the extended due date for filing estate tax return may not be later than 15 months from date of the decedents death.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the executor of a 2010 estate who files a Form 4768, Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, by the due date for filing Form 706, U.S. Estate Tax Return, or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, both an automatic six month extension of time to file Form 706, U.S. Estate Tax Return, or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return pursuant to Section 6081, and a six month extension of time to pay the estate tax. The executor of a 2010 estate is not required to substantiate on the Form 4768, Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768 ), Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, justification needs to be provided.

Filing Requirements and Due Dates for Form 709 United States Estate (and Generation-Skipping Transfer) Tax Return
  1. Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, is filed by individuals to report certain gifts of terminable interests, gifts to his/her spouse (whether a U.S. citizen or a Non-U.S. citizen), gifts to donees other than their spouse of future interests or any amount or gifts of present interests of more than $14,000 to any one donee, gifts to charities, political organizations, transfers subject to the generation-skipping transfer tax or estate-tax inclusion period, gift-splitting (especially when the gifts exceed $14,000 per spouse per donee), etc. Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, is used to report transfers subject to the Federal gift and certain Generation-Skipping Transfer (GST) taxes and to figure the tax, if any, due on those transfers, and allocation of the lifetime GST exemption to property transferred during the transferrers lifetime. All gift and GST taxes are computed and filed on a calendar-year basis regardless of the taxpayer's income tax accounting period.

  2. The first $14,000 for tax years 201301 through 201712 ($13,000 for tax years 200901 through 201212; $12,000 for tax years 200601 through 200812; $11,000 for tax years 200201 through 200512; $10,000 for tax years 198212 through 200112; and $3,000 for tax years 198112 and prior) of gifts of present interest to each donee during the calendar year is subtracted from total gifts in figuring the amount of taxable gifts. For a gift in trust, each beneficiary of the trust is treated as a separate donee for purposes of the annual exclusion. The annual exclusion for gifts of present interests made to a donee during the calendar year is $14,000. Any gift amount given in excess of that $14,000 per donee per year is taxable. (Exception: The annual exclusion amount for a foreign spouse is $147,000 for 2015 and $148,000 for 2016.)

  3. The Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, is an annual return which, generally, must be filed on or after January 1 and by April 15 of the year following the date the gift was given.

    1. If the donor died during 2015, the executor must file the donors 2015 Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, not later than the earlier of (a) the due date (with extensions) for filing the donors estate tax return or (b) April 15, 2017. If the donor died during 2017, the executor must file the donors 2017 Form 709, United States Gift (and Generation-Skipping Transfer) Tax Returns, not later than the earlier of (a) the due date (with extensions) for filing the donors estate tax return or (b) April 15, 2018.

  4. Any extension of time granted to file the taxpayer's calendar year income tax return will also extend the time to file Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, Income tax extensions are made using Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return; or Form 2350, Application for Extension of Time To File U.S. Income Tax Return. If the taxpayer has filed late and an extension (TC 460) does not exist on the account, research the Individual Master File (IMF) account for a posted TC 460.

    Note:

    Form 1127, Application for Extension of Time for Payment of Tax Due to Undue Hardship, is used by taxpayers to request an extension of time to PAY (gift) taxes. The conditions under which extensions may be granted can be found in the Form 1127, Application for Extension of Time for Payment of Tax Due to Undue Hardship, instructions.

  5. See IRM 3.12.263.3.1.2, Extension of Time for Filing, for additional information regarding extensions of time for filing. See IRM 3.12.263.3.2.1, Installments and Form 4349, for information regarding extensions of time to pay.

Filing Requirements and Due Dates for Form 709-A, United States Additional Estate Tax Return
  1. Form 709-A, United States Additional Estate Tax Return, was obsoleted in October 2003. All gift tax returns must now be filed on Form 709, Unites States Gift (and Generation-Skipping Transfer) Tax Return.

Community Property Information

  1. In community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin) husband and wife each usually are considered to own half of the property owned by either one.

  2. Community property laws apply to estate tax returns if the taxpayer is domiciled in a community property state at the time of death. Accept taxpayer's claimed domicile. Half of the community property interest must be included in the decedent's gross estate.

Installments and Form 4349, Computation of Estate Tax due with Return and Annual Installment
  1. The request for installment payments under IRC 6166 may be included with the return or the election may be made by the taxpayer answering the appropriate questions (Form 706, U.S. Estate Tax Return, Page 2, Part 3, Line 3) on the return. If Field 01PI contains a code 1, 3, 5 or 7, Form 4349, Computation of Estate Tax Due with Return and Annual Installment, must be completed by Compliance Services, Estate and Gift Tax Campus Operation, if Form 706, U.S. Estate Tax Return, Line 20, contains a Balance Due. This election may be in addition to extension requests made under IRC 6161, Extension of Time to Pay, and/or IRC 6163 Election Examination.

  2. If the installment privilege is tentatively granted under IRC 6166, Compliance Services, Estate and Gift Tax Campus Operation, will prepare Form 4349, Computation of Estate Tax Due with Return and Annual Installment, for all cases in which Field 01PI contains Code 1, 3, 5, or 7.

  3. If a return requesting installments does not have Form 4349, Computation of Estate Tax Due with Return and Annual Installments, attached, suspend the return with AC 370. Attach routing slip with remarks to Examination Installment Unit.

Refund Returns (45 Day Jeopardy and 10 Million Dollar Refunds)
  1. Document Perfection is responsible for identifying refunds and for initiating requests for manual refunds.

    Note:

    Expeditious processing of refund returns is critical if the 45 day period is about to expire.

  2. AC 341 should be input by Code and Edit to show that a manual refund is needed. If these conditions are not identified in Code and Edit, Error Resolution must follow the following criteria:

    If Then
    The processing date is more than 20 days after the IRS received date or the return due date (whichever is later) and the 45 day interest free period is in jeopardy and the refund amount is $25,000 or more.

    Note:

    Refund in this instruction means only the amount requested to be refunded to the taxpayer, not overpayments transferred to other periods.

    1. Enter AC 341.

    2. Route to Error Resolution Team 101 for manual refund.

    The refund is $10,000,000 or more
    1. Enter AC 341.

    2. Route to Error Resolution Team 101 for manual refund.

Taxpayer Advocate Service (TAS) Manual Refunds
  1. Taxpayer Advocate Service (TAS) Manual Refunds - any return hand walked by a W&I Submission Processing (SP) liaison for TAS as a manual refund should be processed by a lead tax examiner or designated tax examiner using the following procedures in the order listed:

    1. CCC "O" should be edited on the return and entered in Field 01CCC.

    2. Delete CCC "Y" from Field 01CCC.

    3. Continue processing the return.

  2. Correspondence - If the return requires correspondence for missing or incomplete information, then do the following:

    1. Prepare Form 3696, Correspondence Action Sheet, or other approved correspondence action sheet and request all information that is missing or incomplete.

    2. Inform the W&I SP liaison of all information that is being requested.

    3. Suspend (SSPND) with appropriate suspense code and give the return back to the W&I SP liaison.

    4. The W&I SP liaison will contact the TAS employee to obtain the required information needed to complete the processing of the return.

  3. Other Suspense Action - If the return requires other suspense action, then do the following:

    1. Initiate suspense (SSPND) action according to procedures.

    2. Inform the W&I Submission Processing liaison the reason for the action taken.

    3. Give the return back to the W&I Submission Processing liaison.

    4. The W&I Submission Processing liaison will contact the TAS employee, who in turn will take the necessary action to complete the processing of the return.

  4. Assigning Taxpayer Notice Codes (TPNCs)/Math Error - When a math error is identified, do the following:

    1. Assign the applicable TPNC according to procedures.

    2. After all TPNCs have been assigned, inform the W&I Submission Processing liaison of the TPNCs issued.

    3. Suspend (SSPND) with appropriate suspense code and give the return to the W&I Submission Processing liaison.

    4. The W&I Submission Processing liaison will contact the TAS employee, who in turn will take the necessary action to complete the processing of the return.

  5. When Balance Due/Overpayment Math Error generates do the following:

    1. Make a screen print of the Error Code Screen Display, highlight the Computer Generated Refund Amount, and attach the print to the front of the return with the entity portion of the return visible.

    2. Enter the amount the taxpayer claimed as the amount they requested to be refunded back into Field 03B/R.

  6. If Balance Due/Overpayment Math Error regenerates because the taxpayer made a math error when computing their refund, then do the following:

    1. Make a screen print of the Error Code Screen Display, highlight the Computer Generated Refund Amount, and attach the print to the front of the return with the entity portion of the return visible.

    2. Assign the appropriate TPNC.

  7. Once return processing is complete, give the return, Form 12412, Operations Assistance Request (OAR), and the Error Resolution screen print to the W&I Submission Processing liaison.

  8. Rejects Suspense - Manual refunds that are hand walked by a W&I Submission Processing liaison that have been suspended should be processed as follows:

    1. Follow the specific instruction given by the W&I Submission Processing liaison in regards to correspondence issues and the assignment of the TPNCs.

    2. Refer to applicable paragraphs above.

Glossary

  1. Error Resolution Action Code (AC) - A 3 digit numeric code used to put the document in suspense. This shows the need for additional information not available in the record or on the return. Only one action code can be used on a record at a time.

  2. Computer Condition Code - A 1 digit number or letter used to identify a specific condition or computation on a return.

  3. Entity Index File (EIF) - Computer file that stores name data for each SSN on file. A check is made between the SSN and name entered. This check is made during transcription.

  4. Error Code - A 3 digit numeric code naming a specific math or consistency error in an error record.

  5. Error Records - Data records failing any of the math or validity checks on the Generalized Mainline Framework (GMF) system or containing an invalid or incomplete action code.

  6. Generalized Mainline Framework (GMF) - The system used to process and control all documents through the submission processing campus pipeline.

  7. Key Index File (KIF) - A computer file of TINs which can be accessed by using command code NAMES/NAMEI with name and address data.

General Corrections Procedures

  1. Perfecting the Tax Return and Error Screen Displays.

    1. The error screen display shows the DLN, the SSN and the name control, if present, in the header portion of each error record. Previously assigned taxpayer notice codes will also be shown in the header information.

    2. Before correcting the error screen displays, make sure the DLN of the screen display matches the DLN of the document. Take the following action.

    If Then
    A mixed data situation exists (information from two taxpayers' returns appear on the error record under one DLN or the DLN does not match the return on screen display) Stop processing, give the block of work to your manager. Management will see if the mixed data can be corrected via the terminal screen displays or will have the blocks deleted and re-input.
  2. Make sure the taxpayer's entries are on the correct lines of the tax return. Check for coding and transcription errors in each section and field of the screen display and on the return and correct as needed. Follow specific instructions and local procedures (such as Quality Alerts) for all sections and fields. Make sure all sections and fields were transcribed.

  3. Missing Signature - A signature is needed on all returns. If the signature area on the tax return is not signed, SSPND with AC 225 (Signature Only - Domestic Returns) or 226 (Signature Only - Foreign Returns).

Command Codes (CCs)

  1. The Command Codes (CCs) used to correct and research the Error Inventory and the Workable Suspense Inventory are described below. They are also explained in IRM 3.12.38, Error Resolution System (ERS), General Instructions. Any CC permitted by the employee's security file will be available to the tax examiner.

  2. Enter CCs correctly, or you will get an error message. Correct the data entered with the CC and transmit.

    1. ACTVT - Used to transfer an unworkable suspense record to the workable suspense inventory.

    2. BMFOL - Used to provide nationwide BMF entity and tax data information on-line for tax accounts that are in credit or debit status, and/or contain freeze conditions. It will display any tax account, even zero balance, that has not been moved to lower level. Account does not have to be a credit or a debit. It will also display a list of accounts moved to the retention register. Other accounts that are not on the retention register will be available on-line within 24 hours upon request.

    3. BRTVU - Used to provide business return transaction information. The file consists of original input return data, including schedules. This return information includes Code and Edit, Error Resolution (ERS) and computer generated fields. This command code was previously announced as CC RTVUE for business returns.

    4. CRECT - Used to make a correction. Use CRECT only after an error has been displayed in response to the GTREC command. You cannot correct the Remittance Field in a record with the CC CRECT.

    5. DLSEC - Used to delete a section within a record in process.

    6. ENMOD - Used to research a name control.

    7. ERINV - Used to research a specific DLN or TIN on the Error Resolution Control File. It also displays the number of records in a block.

    8. ERVOL - Used with a Status Code to display the number of Error Resolution records in the current Workable Inventory. The printed reports for error Resolution are updated nightly. You may obtain the actual count of records to be worked at any time by using CC ERVOL.

    9. GTREC - Used to access the first error record in an Error Resolution error block or to get a specific record in the Workable Suspense Inventory. It can also be used to re-display any uncorrected error.

    10. GTRECQ - Used to access a worked record held for Quality review.

    11. GTRECW - Used to retrieve an Error Resolution data record that has already been worked. Use this CC any time on the same processing day. If an error is found after that day, the record must be corrected using Notice Review and Adjustment procedures.

    12. GTSEC - Used to display any data section within the record in process. The command will display all correctable fields in the requested section, including blank fields. It will not show computer generated fields or error indicators. If no data is present in the specified section, the empty format of the requested section is displayed.

    13. INOLE - Used to access the most current entity data from the National Account Profile (NAP) files.

    14. MFREQ - Used to request an entity module or a tax module and its related entity data from Master File when case control is not required.

    15. NAMEE/NAMES/NAMEI/NAMEB - Used to research missing or invalid SSNs, TINs or Employer Identification Numbers (EINs) when only the name and address are available.

    16. RJECT - Used to reject a record from Error Resolution .

    17. SSPND - Used with an Error Resolution AC to place a record in Suspense status. Use SSPND for Error Correction and Suspense Correction.

    18. TXMOD - Used to research an active tax module.

Error Resolution System Action Codes (ACs)

  1. The Error Resolution Action Code (AC) indicates that certain information is missing or that the record should be rejected from processing. The code will have sufficient detail to indicate if correspondence is to be sent to the taxpayer or specific in-house research or action is required.

  2. See AC table below for the appropriate codes:

    Note:

    * CE = Code & Edit, EC = Error Correction, S = Suspense, GEN = Computer Generated

    Action Code Description Workday
    Suspense
    Period
    Function *
    001 Input Document AC 001 will be computer generated or entered from Error Resolution with CC SSPND when the Block Out of Balance (BOB) Resolution Function has added a missing document by only inputting the name control and TIN for the missing document. See IRM 3.12.263.3.9.2, Error Correction Action Code (AC), for corrective procedures. 0 EC
    211 First Taxpayer Correspondence 40 CE, EC, S
    212 Second Taxpayer Correspondence 25 CE, EC, S
    213 Correspondence to Other than Taxpayer 40 CE, EC
    215 International Correspondence 45 CE, EC, S
    225 Signature Only 40 CE, EC, S
    226 Signature Only (International) 45 CE, EC, S
    310 Statute Control 10 CE, EC, S
    320 Entity Control 10 CE, EC, S
    331 Frivolous Review 3 CE, EC
    332 Questionable Refund Detection Team (QRDT) Review 3 CE, EC
    333 Prompt Audit 10 CE, EC
    334 Joint Committee 10 CE, EC, S
    335 Frivolous Case 10 CE, EC, S
    336 QRDT 10 CE, EC, S
    337 Other Criminal Investigation Division (CID) 10 CE, EC, S
    341 Manual Refund 10 CE, EC, S
    342 Credit Verification 10 CE, EC, S
    343 Other Accounting 10 CE, EC, S
    344 Manual Refund (Error Resolution) 0 EC
    347 Form 2553, Election by Small Business Corporation, to Entity 20 CE, EC, S
    351 TIN Research 0 EC, S
    352 Name Research 3 CE, EC, S
    353 Address Research 3 CE, EC, S
    354 Filing Requirements Research 3 CE, EC, S
    355 Other Research 3 CE, EC, S
    360 Other In House Research 10 CE, EC, S
    370 Examination 10 CE, EC, S
    410 Assistance Needed/Special Handling 3 CE, EC, S
    420 Management Suspense A 5 CE, EC, S
    430 Management Suspense B 10 CE, EC, S
    440 Management Suspense C 15 CE, EC, S
    450 Management Suspense D 20 CE, EC, S
    460 Management Suspense E 25 CE, EC, S
    480 Early Filed Suspense 150 CE, EC, S
    510 Missing Document 0 CE
    511 Missing Document 1st Suspense 25 EC, S
    512 Missing Document 2nd Suspense 20 S
    513 Missing Document 3rd Suspense 20 S
    515 Missing Document Short Term 5 EC, S
    550 Magnetic Tape Attachment 3 CE
    551 Magnetic Tape Inconsistent Data 3 CE
    610 Renumber 0 CE, EC
    611 Remittance Renumber 0 S
    620 NMF/Non-ADP (Automated Data Processing) 0 CE, EC, S
    630 Re-input 0 EC
    640 Void 0 CE, EC, S
    650 International 0 CE, EC
    660 Data Control Delete
    (Tape Edit Processing (TEP) Delete)
    0 GEN
    670 Deleted Missing Document 0 GEN
    700 Duplicate Block 0 GEN
    711 Duplicate Document DLN from CE NA GEN
    712 Duplicate Document DLN from EC NA GEN
    713 Duplicate Document DLN from Inappositeness NA GEN
    714 Duplicate Document DLN from Unworkable Suspense NA GEN
    715 Duplicate Document DLN from Workable Suspense NA GEN
    900 Unpostable Record 0 GEN
  3. Document Perfection tax examiners will give a three digit code to numbered returns when they cannot process the return in the present form until additional information is received or some manual intervention is required.

  4. Document Perfection will attach Form 3696, Correspondence Action Sheet, to begin correspondence. Use the AC and state what missing information is needed.

  5. A valid AC other than 001 places the record in Suspense Inventory, either Workable or Unworkable.

  6. Only assign one AC at a time to a record. The priority of the ACs are 310, 320, 4XX, 6XX, 3XX, 2XX.

  7. Code and Edit tax examiners will enter ACs on the bottom left hand corner of the return.

    1. Data Conversion will transcribe the AC into the record of the form.

    2. If Code and Edit assigns an invalid or incomplete AC, the record will be sent to the Error Inventory for correction or deletion of the code.

    Note:

    On reprocess/re-input documents, Error Resolution should determine if the AC should be deleted. The AC may have been valid the first time through the pipeline, but not valid for a reprocess/re-input. For example, if a reply is received for AC 211 and the information is attached to the return, the AC 211 would be invalid and should be edited out (i.e., circled) to prevent future suspense.

  8. An Error Resolution tax examiner may enter an AC on a record, delete or correct an invalid code or may replace the present AC with another to either re-suspend or reject from Error Resolution.

    1. Enter a valid AC with CC SSPND. IRM 3.12.38, Error Resolution System (ERS), General Instructions, also explains these codes.

    2. Entering a valid AC with CC SSPND clears the record from the screen and places the record in either Workable Suspense or Unworkable Suspense. And take the following action:

    If Then
    The AC cannot describe the required action Attach a note of explanation to the return (routing slip).
    The tax examiner will not be issuing a letter through IDRS Attach a Form 3696, Correspondence Action Sheet, to issue the correspondence.
  9. A Reject tax examiner entering a valid AC with CC RJECT rejects the record from Error Resolution. Generally the Service Center Control File (SCCF) will be automatically updated for the rejected records. An Unpostables tax examiner entering an AC with CC NWDLN rejects the record from the Error Resolution inventory and establishes the new DLN under which the record is to be entered.

  10. The computer generates a Form 4251, Return Charge Out, for all new suspense items. Use the form to pull documents to route the controlling documents while holding the record in suspense and to associate the document in the Workable Suspense Inventory when the record becomes workable.

    1. When a record appears on the Workable Suspense Inventory with the AC as first priority, add the information received to the record or follow the IRM instructions for "no reply" . Clear the AC by entering the letter "C" in the Clear Field (CL) and transmitting. Once you clear the AC, any Validity, Section, or Math/Consistency errors will be shown for correction.

    2. Records that had been unprocessables may again require suspense for additional information. Re-suspended items do not generate a charge-out. Note the charge-out in the correct block by entering the AC and date.

  11. When you cannot perfect a record, reject it from Error Resolution by using CC SSPND/RJECT with AC 640. Unpostables will take action to have the DLN voided.

  12. You may be able to perfect the record but the document may need to be renumbered because the DLN or remittance amount may need to be corrected. Suspend with AC 610 or 611.

Clear Code "C" and "000"

  1. Use the letter "C" as a Clear Code to remove the error codes (consistency errors) when you do not have to change or correct the record to fix the error. The display will show a Clear field, labeled "CL" if a Clear Code can be used. The Clear field can be found to the right of "CRECT" on the screen display.

  2. Clear an error code with an available Clear Code by either correcting the problem or entering a "C" to state no correction is needed. If other corrections are needed, they must be entered and transmitted prior to entry of the Clear Code "C" . Make sure that all corrective procedures have been followed for each individual error code before entering a "C" in the Clear Code field.

  3. Use Clear Code "C" to clear the AC from the screen after completing corrections, or when AC 410 and 700 are used. The AC must be cleared before other errors in the record can be resolved. The presence of the "C" with a Priority I Error states you have made the corrections to the AC and now wish to see any other errors on the record.

  4. Use Clear Code "000" to delete all action codes only when you have invalid and erroneous ACs and there is no reason to suspend the record. Suspense correction cannot use "000" .

  5. When you suspend a record with CC SSPND, programming erases all "C" Clear Codes for error codes and action codes for the new day's Error Inventory and Workable Suspense Inventory.

  6. Unfinished records from the previous day contain none of the "C" Clear Codes given to a record not completely worked.

  7. Error Codes (including ones which may require a "C" Clear Code) are numbered consecutively for correcting.

    1. While correcting errors on the terminal, you may create an error code with a higher priority than the one(s) you have cleared with a Taxpayer Notice Code (TPNC) or "C" Clear Code. If this happens, programming erases all TPNCs for error codes with a lower priority than the one created.

    2. Programming will continue displaying error codes for the record beginning with the higher priority error code created. Displays using the corrected data may be different from those previously displayed.

    3. You can correct by erasing an error code that you previously cleared with a "C" and now the error condition no longer exists. Should this occur, the "C" Clear Code for this error and all "C" and TPNCs for all subsequent errors in the record will be deleted.

    4. If after deleting the "Cs" and TPNCs there are errors remaining on the record, they will continue to be displayed for resolution whether or not they were previously displayed.

  8. The "C" Clear Code will not allow any other corrections to the record to accompany the "C" Clear Code. If a correction must be entered, but you have already transmitted the "C" Clear Code, enter CC GTSEC 01 and put a "G" in Field 01CCC. Transmit and remove CCC "G" when the Error Code 010 appears to reset the record. If you used CC SSPND and the record is no longer displayed, then use CC GTRECW to make any corrections.

Types of Errors

  1. The Error Resolution System identifies errors based on type and priority. The record heading shows the type of error. Types include:

    • AC Error (Priority I)

    • Section Error (Priority II) Integrated Submission and Remittance Process (ISRP) priority code

    • Validity Error (Priority III)

    • Math/Consistency Error (Error Codes) (Priority IV)

  2. Tax examiners may find that programming has not included a field or section needed to correct an error. In this event, use CC GTSEC to get the needed field. This should be reported to Headquarters for correction of the display.

Priority I Errors - Suspense Inventory Correction Procedures (Reject Procedures)

  1. All records with an invalid AC assigned by Document Perfection will be placed in the Error Inventory and shown as a Priority I Error.

  2. All records with a valid AC will be assigned to a Suspense Inventory and shown as Priority I Error.

  3. See also IRM 3.12.38, BMF General Instructions, for additional information regarding ACs and/or Priority I Errors.

Display
  1. The AC for the record with the literal description of the action will be shown.

Error Correction Action Code (AC)
  1. Enter CC SSPND with the correct AC, then transmit to suspend the record. using the following information:

    If Then
    Suspense is not required Enter "000" in the Clear field (CL) and transmit.
    Document in block Do not remove the document from the block (except for priority statute and manual refund cases).
  2. Under Error Resolution, AC 001 is a Priority I Error.

    1. This happens when the Block out of Balance (BOB) Resolution function adds a document to a block by entering only the name control and TIN. Error Resolution will add the rest of the record.

    2. Enter CC GTSEC for each record section that should have data. Add the required data.

    3. When all the sections have been entered, enter "C" in the Clear field, and normal validity checks will be made to the record.

Procedures for Correcting Priority I Action Code (AC) Errors
  1. The following information pertains to procedures for correcting Priority I AC Errors.

Priority - I Error, AC 21X Correspondence
  1. The following information pertains to AC 21X correspondence:

    If Then
    Status 321:
    Suspense period expired with no reply
    If a letter was needed, follow the No Reply instructions.
    Status 331 or 431:
    The Statute Control asks that the record be voided to them. (Statute Control will provide instructions when returning the document) OR
    Follow local procedures.
    Status 421:
    You get a reply
    Follow reply instructions/add provided information in the reply before clearing Priority 1 error.
    The Statute Control Group clears the record Use CC GTSEC for Section 01, check Field 01TXP, Tax Period, and enter CCC "W" in Field 01CCC. Transmit and then clear the Priority I Error with the "C" Clear Code.
Priority I Error, AC 320 Entity Control
  1. Status 332 or 432: Entity Control will provide instructions when returning the document.

  2. Follow instructions from Entity Control before clearing the Priority I Errors.

  3. If the return was sent to Entity for the name control or SSN, Enter the correct fields using CC GTSEC for Section 01.

Priority I Error, AC 33X, Review/Routing To Criminal Investigation Division (CID)
  1. Status 333 or 433: Document will be referred to the Criminal Investigation Division (CID) before it is given to the tax examiner.

  2. Instructed to void the record and refer Form 706, U.S. Estate Tax Return, or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return to Criminal Investigation Division. Follow local procedures

  3. The return will continue to be processed, Follow Criminal Investigation Division, instructions before clearing Priority I Error.

Priority I Error, AC 34X, Routing - Accounting
  1. Accounting should return the form to the tax examiner to work.

  2. Follow Accounting instructions before clearing the AC.

Priority I Error, AC 35X, Key Index File (KIF)/Other Research
  1. AC 351, Status 435: Means Key Index File (KIF) was not available when record was on the Error Inventory take the following action:.

    If Then
    SSN is found using CC NAMES/NAMEI
    1. Verify using CC INOLES.

    2. GTSEC 01 and enter in Field 01SSN.

    SSN is not found using CC NAMES/NAMEI Re-suspend (SSPND 320) to Entity for the SSN.
  2. AC 352, 354, 355, Status 335 or 435:

    If Then
    Unable to solve after using CC INOLE/ENMOD/MFREQ Re-suspend to Entity with AC 320.
    Correspondence is necessary and there is no address Use AC 353.
Priority I Error, AC 360, Other In-House Research
  1. Status 336 or 436: You will get the document and instructions from another area.

  2. Follow those instructions using CC DLSEC/GTSEC before clearing Priority I Error.

Priority I Error, AC 410 Assistance
  1. Clear the Priority I Error with the "C" Clear Code, so that other errors in the record might display.

Priority I Error, ACs 420 through 460, Management Suspense
  1. Management may tell you to work or re-suspend the record. Take the following action for processing.

    If Then
    Re-suspending Use CC SSPND and the correct AC.
    Working the record Clear the Priority I Error with a "C" Clear Code, so that other errors in the record might display.
Priority I Error, AC 490 System Problem
  1. Computer Branch will tell your manager what to do, proceed with the following action.

    If Then
    Instructions are not received for Status 349 You may be told to re-suspend with "SSPND 490" .
    No other error exists on the record DANGER: Once you clear AC 490, the record will go to good tape. You must get instructions from the Computer or Submission Processing Campus before clearing.
Priority I Error, AC 51X, Status 451 or 351
  1. Suspend record with AC 51X to initiate special search. The charge-out issued for missing document(s) may be used for the initial search. It may also be used for subsequent searches by marking "Second Request" , "Third Request" , etc. on the charge-out returned from files.

  2. Keep requesting searches until document is located or record is rejected from Error Resolution.

Priority I Error, AC 6XX, Rejects
  1. The following information pertains to Priority I Errors:

    If Then
    AC 6XX is used to suspend to Workable Suspense
    1. Review document to see if you agree with the recommended reject action.

    2. If so, follow local procedures.

    The record is not deleted Clear the Priority I Error with the Clear Code "C" so that any other errors that might exist can display.
Priority I Error, AC 700, Duplicate Block DLN
  1. Clear the Priority I Error with the "C" Clear Code so that other errors in the record might display.

Priority I Error, AC 900 Unpostable Records
  1. The literal for the AC 900 will include the Unpostable Code. Follow the appropriate action,

    If Then
    The record can be resolved for AC 900 returns
    1. Use CC GTSEC for the desired section(s) and make the correction(s).

    2. Enter a "C" in the Clear field after all corrections are made and transmitted.

    3. After you clear AC 900, all other errors on the record will be displayed for correction.

    No other errors exist
    1. The record will clear the screen.

    2. The record has not posted to Master File.

    3. Fields displayed will be as processed prior to being an "Unpostable" .

    4. The record may contain coding and transcription errors.

    5. All Clear Codes and Taxpayer Notice Codes assigned when previously processed will have been deleted from the record and will need to be assigned again, if still applicable.

    The error cannot be resolved on the Unpostable Record (AC 900)
    1. Re-suspend the record with SSPND and the correct AC.

    2. Write and explain the AC and date on the charge-out and send the return and charge-out to the Suspense Documents File.

For AC 3XX, Status 33X
  1. The following information pertains to AC 3XX:

    If Then
    Requested information is not available Verify that the return is for the taxpayer. The tax examiner will be told to re-suspend the record; AC 3XX.
    This occurs often Headquarters should be asked to review the suspense period.
    A document is not available for a record on the Workable Suspense Inventory (AC other than 510) The Suspense Documents File Unit will contact the manager who will search within Error Resolution.
    It cannot be found The manager will state it is missing. The tax examiner working the record will re-suspend the record with AC 511, initiating a search for the document.

Priority II Errors - Section Errors

  1. The Integrated Submission and Remittance Processing (ISRP) should eliminate most editing, missing section, and terminus errors. If normal Integrated Submission and Remittance Processing, validity checks have been bypassed, edit errors and/or terminus errors may be present.

  2. Edit Error - A section with an error detected by Integrated Submission and Remittance Processing. Edit errors will be coded as follows:

    1. Code 1 = Split screen transmission. Key verifier tried to change the Check Digit, key verifier changed four or more digits of the TIN, or the original entry operator indicated that a required section is missing.

    2. Code 3 = Invalid section ending point.

    3. Code 4 = Invalid field length.

    4. Code 5 = Questionable section - A section entered twice or entered out of sequence by Integrated Submission and Remittance Processing.

Terminus Error
  1. A section with variable length input fields with fields the wrong size.

Display
  1. All transcribed fields, except the Error Resolution AC and the remittance (payment received), will be displayed in columnar format with or without data. Integrated Submission and Remittance Processing, Problem Code errors will also show the type of error. Only one section (error) will be displayed at a time.

Content
  1. Any individual section, excluding computer generated fields and the AC. (The AC is an uncorrectable field except as defined for CC SSPND.)

Correction Procedures
  1. Integrated Submission and Remittance Process Errors - You must check all fields of the section. If Section 01 of the return is coded, verify that the return is for the taxpayer whose name is in Section 01. After you correct the section, or if no corrections are necessary, transmit from the bottom of the screen.

  2. Terminus Errors - You must check all fields of the section. Make all necessary corrections. After you correct the section, or if no corrections are necessary, transmit from the bottom of the screen.

Questionable Section
  1. Check and enter all of the data for the displayed section. After you correct the section, or if no corrections are necessary, transmit from the bottom of the screen.

  2. Correct all fields in the display before transmitting.

Priority III Errors - Field Errors Definition

  1. Any field failing to meet the requirement(s) for that field will be shown as a Priority III error. Consistency and/or relationships with other fields will not be a factor. Some reasons for field errors include:

    • Non-numeric character in a numeric field

    • Non-alphabetic character in an alpha field

    • Blank space in a number field

    • Blank in the first position of an alpha field

    Note:

    Individual field validity errors to be bypassed after initial consideration are shown as Priority IV Errors.

Display
  1. All fields with a Priority III Error will be displayed in columnar format in the order encountered in the record. The ACs and TPNCs do not display as a Priority III Error.

  2. An overflow field is identified by all question marks for a money field or a single pound sign in the last position of a name line.

Correction Procedures
  1. If a field shows in error:

    1. Correct every error field displayed using the specific instructions within each section for the field in error.

    2. Check the information on the source document to determine if each displayed field has been correctly edited and transcribed.

    3. Enter the correct data for each field displayed.

    4. If there is no data for the field, blank the field.

    5. Correct every field displayed.

    6. Transmit.

Taxpayer Notice Codes (TPNCs)

  1. Use this code when there is a math error which affects the tax liability or tax due/overpayment. Enter it on the terminal screen following the literal "NC" and write it on the upper left corner of the return.

  2. Enter the TPNC after you see that no further corrections to the record are needed. The TPNC tells the computer that no other corrections to the screen display will be made. Enter and transmit all corrections for each error condition before using a TPNC. Each math error has a certain TPNC that can be used to clear the error. The TPNC used must be valid for the Error Code.

  3. Each math error display needs either a correction to a field or the entry of a TPNC. You cannot make any other correction when transmitting a TPNC. TPNCs used for a math error will be shown on subsequent displays for the record. This field is used for display purposes only and cannot be corrected.

    Note:

    If you determine that you sent an unnecessary or incorrect TPNC, see IRM 3.12.263.3.12.2, Changing a TPNC.

TPNC 90
  1. TPNC 90 is a blank notice which contains up to 10 lines available on the notice for whatever statement is needed. The following information pertains to TPNC 90. Error Correction will prepare the exact wording of the error and attach it to the return. Notice Review will type math error explanation on the notice before mailing to the taxpayer. Please use the TPNC 90 Math Error Code Job Aid when a TPNC 90 is needed

    If Then
    More than three codes need to be used (a return can have as many as three TPNCs) Use TPNC 90 instead and list the errors for Notice Review to type and send to the taxpayer.
    TPNC 90 is used
    1. This is a "fill-in" and should be used when no other TPNC fully explains the correction(s) made. The tax examiner will write exactly what should appear on the notice and attach it to the face of the return.

    2. Charge the return out and route directly to Notice Review or follow local procedures.

    3. Notice Review or the responsible party will type the math error explanation on the notice and mail it to the taxpayer.

    Note:

    In January 2014, the Taxpayer Notice Code (TPNC) 90 Math Error (ME) Code literals were programmed into the Online Notice Review (OLNR) Retype Application for Notice Review (NR). This addition will eliminate the need for the NR tax examiner to manually type the notice literal and reduce potential copying/typing incorrect paragraphs/messages in the notices. For a full listing of the programmed TPNC 90 Math Error Codes, see TPNC 90 Math Error Code Job Aid on Servicewide Electronic Research Program (SERP) at http://serp.enterprise.irs.gov/databases/portals.dr/sp-portal/bmf.dr/bmf_ers/job_aid.dr/TPNC-90-Math-Error-Code-Job-Aid.doc.

Changing a TPNC
  1. Once you transmit a TPNC, it may be changed in the following manner:

    1. Records which have not been cleared from the terminal - if you still have errors after transmitting the TPNC you can create an error with a higher priority. To do this, input "G" into Field 01CCC. This will cause EC 010 to generate. Delete the "G" creating a higher priority error. This will delete all "C" Clear Codes and any notice code already assigned a lower priority error from the header display. The display will then show the high Priority IV error created and all subsequent errors, even though they may have been previously shown.

    2. A correction you make erases an error code which you have previously cleared with a TPNC or "C" Clear Code. In this case, the "C" or TPNC on this error and all subsequent error codes will be shown for resolution. The TPNC(s) for this error and subsequent error codes will be deleted from the header display.

    3. Records which have been worked may be reworked using CC GTRECW. See IRM 3.12.38.3.2, General Correction Procedures, for further details.

    4. All TPNCs are erased when a record is suspended with CC SSPND.

    5. If you do not completely work a case, the TPNCs you used on the unfinished records will not be there the next day.

TPNCs and Their Notice Messages for Form 706, U.S. Estate Tax Return
  1. The following information pertains to Form 706, U.S. Estate Tax Return, Error Messages:

    Taxpayer Notice Code Taxpayer Notice Statement
    TPNC 36 We found an error in the computation of Net Estate Tax.
    TPNC 37 We found an error in the computation for State Death Taxes.
    TPNC 38 We found an error in the computation of Tentative tax.
    TPNC 39 We found an error when the credit amounts were added on Page 1, Part 2.
    TPNC 40 We found an error in the computation of the balance due.
    TPNC 41 We found an error in the computation of the Unified Credit amount. The Unified Credit amount you reported was $n,nnn,nnn,nnn,nnn.nn. The amount we recomputed is $n,nnn,nnn,nnn,nnn.nn.

    Note:

    For Form 706, U.S. Estate Tax Return, use this TPNC for 2011 revisions and prior ONLY.

    TPNC 43 We found an error in the computation of the Applicable Credit amount. The Applicable Credit amount you reported was $n,nnn,nnn,nnn,nnn.nn. The amount we recomputed is $n,nnn,nnn,nnn,nnn.nn.

    Note:

    For Form 706, U.S. Estate Tax Return, use this TPNC for 2012 revisions and subsequent.

    TPNC 42 We found an error in the computation of the Marital Deduction on Schedule A.
    TPNC 47 We found an error on Schedule R in the computation of Total Generation-Skipping Transfer Tax.
    TPNC 50 We found an error on Schedule R-1 - Generation-Skipping Transfer Tax.
    TPNC 54 We found an error in the computation of the balance due or overpayment amount.
    TPNC 64 We found an error in the computation of Line 3c, Taxable Estate.
    TPNC 70 We found an error in the computation of the gross estate tax amount on Line 8.
    TPNC 71 We found an error in the computation of the allowable Unified Credit amount on Line 11.
    TPNC 72 We found an error in the computation of the amount on Page 1, Part 2, Line 12.
    TPNC 73 We found an error in the computation of the Allowable Applicable Credit amount on Line 11.
    TPNC 82 We found an error in the computation of the amount on Page 1, Part 2, Line 18.
    TPNC 83 We found an error in the computation of your Total Tax amount.
    TPNC 90 TPNC 90 is a blank notice that contains up to 10 blank lines which are available on the notice for whatever statement is needed. It is used when more than three math errors were made on the return or there is no math error code that meets the error condition on the return. The tax examiner will write exactly what should appear on the notice and attach it to the face of the return. Charge the return out and route directly to Notice Review and follow local procedures. Notice Review, or the responsible party, will type the math error explanation on the notice and mail it to the taxpayer.

    Note:

    In January 2014, the Taxpayer Notice Code (TPNC) 90 Math Error (ME) Code literals were programmed into the Online Notice Review (OLNR) Retype Application for Notice Review (NR). This addition will eliminate the need for the NR tax examiner to manually type the notice literal and reduce potential copying/typing incorrect paragraphs/messages in the notices. For a full listing of the programmed TPNC 90 Math Error Codes, see TPNC 90 Math Error Code Job Aid on Servicewide Electronic Research Program (SERP) at http://serp.enterprise.irs.gov/databases/portals.dr/sp-portal/bmf.dr/bmf_ers/job_aid.dr/TPNC-90-Math-Error-Code-Job-Aid.doc.

TPNCs and Their Messages for Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return
  1. The following information pertains to Form 706-N, U.S. Estate (and Generation-Skipping Transfer) Tax Return, Error Messages:

    Taxpayer Notice Code Taxpayer Notice Statement
    TPNC 20 We found an error on Schedule A - Gross Estate in the U.S.
    TPNC 21 We found an error on Schedule B - Taxable Estate.
    TPNC 22 We found an error on Schedule B, Line 2 - Gross Estate Outside the U.S.
    TPNC 23 We found an error on Page 2, Part III, Schedule B, Line 3 - Entire Gross Estate wherever located.
    TPNC 24 We found an error on Schedule E -Jointly Owned Property.
    TPNC 25 We found an error on Schedule F -Other Miscellaneous Property not Reportable Under Any Other Schedule.
    TPNC 26 We found an error on Schedule G - Transfer During Decedent's Life.
    TPNC 27 We found an error on Schedule H - Powers of Appointment.
    TPNC 28 We found an error on Schedule I - Annuities.
    TPNC 29 We found an error on Page 2, Part III, Schedule B, Line 4 - Funeral expenses, administration expenses, decedents debts, mortgages and liens and losses during administration.
    TPNC 30 We found an error on Page 2, Part III, Schedule B, Line 5 - Deductions for expenses, claims, etc.
    TPNC 31 We found an error on Schedule L - Net Losses During Administration and Expenses Incurred in Administering Property Not Subject to Claims.
    TPNC 32 We found an error on Schedule M - Bequests, etc., to Surviving Spouse (Marital Deduction).
    TPNC 33 We found an error on Schedule O - Charitable, Public and Similar Gifts and Bequests (Charitable Deductions).
    TPNC 34 We found an error on Page 2, Part III, Schedule B, Line 8 - Total Deductions.
    TPNC 35 We found an error on Schedule Q - Credit for Tax on Prior Transfers.
    TPNC 36 We found an error in the computation of Net Estate Tax on Page 1, Part II, Line 12.
    TPNC 37 We found an error in the computation of the Credit for state death taxes on Page 1, Part II, Line 9.
    TPNC 38 We found an error in the computation of tentative tax on Page 1, Part II, Line 4, Tentative Tax on the amount on Line 3.
    TPNC 39 We found an error in the addition of the credit amounts Page 1, Part II, Line 11.
    TPNC 40 We found an error in the computation of the balance due.
    TPNC 41 We found an error on Page 1, Part II, Line 7, in the computation of Unified Credit.
    TPNC 44 We found an error in the computation of tentative tax on Page 1, Part II, Line 5, Tentative Tax on the amount on Line 2.
    TPNC 47 We found an error in the computation on Schedule R in computation of Total Generation-Skipping Transfer Tax.
    TPNC 50 We found an error on Schedule R-1 - Generation-Skipping Transfer Tax.
    TPNC 52 We found an error on Page 2, Part III, Schedule B, Line 9, and/or Page 1, Part II, Line 1, Taxable Estate.
    TPNC 54 We found an error in computing Page 1, Part II, Line 16, Balance Due.
    TPNC 56 We found an error in the computation on Page 1, Part II, Line 2, Total Taxable Gifts.
    TPNC 58 We found an error in the computation of the amount on Page 1, Part II, Line 8, Balance.
    TPNC 60 We found an error in the computation of the amount on Page 1, Part II, Line 9, Other Credits.
    TPNC 62 We found an error in the computation of the amount on Page 1, Part II, Line 15, Earlier Payments.
    TPNC 64 There was an error in computing the amount on Page 1, Part II, Line 18, U.S. Treasury Bonds Redeemed to Pay Estate Tax.
    TPNC 67 We found an error in the computation of the amount on Page 1, Part II, Line 3, Total.
    TPNC 68 We found an error in the computation of the amount on Page 1, Part II, Line 19, Total.
    TPNC 73 We found an error in the computation of the amount on Page 1, Part II, Line 6, Gross Estate Tax.
    TPNC 74 We found an error in the computation of the amount on Page 1, Part II, Line 8, Balance.
    TPNC 76 The amount claimed as prepaid tax with the extension of time to file on Page 1, Part 2, Line 18 was incorrect.
    TPNC 83 We found an error in the computation of your total tax amount.
    TPNC 90 TPNC 90 is a blank notice that contains up to 10 blank lines which are available on the notice for whatever statement is needed. It is used when more than three math errors were made on the return or there is no math error code that meets the error condition on the return. The tax examiner will write exactly what should appear on the notice and attach it to the face of the return. Charge the return out and route directly to Notice Review and follow local procedures. Notice Review, or the responsible party, will type the math error explanation on the notice and mail it to the taxpayer.

    Note:

    In January 2014, the Taxpayer Notice Code (TPNC) 90 Math Error (ME) Code literals were programmed into the Online Notice Review (OLNR) Retype Application for Notice Review (NR). This addition will eliminate the need for the NR tax examiner to manually type the notice literal and reduce potential copying/typing incorrect paragraphs/messages in the notices. For a full listing of the programmed TPNC 90 Math Error Codes, see TPNC 90 Math Error Code Job Aid on Servicewide Electronic Research Program (SERP) at http://serp.enterprise.irs.gov/databases/portals.dr/sp-portal/bmf.dr/bmf_ers/job_aid.dr/TPNC-90-Math-Error-Code-Job-Aid.doc.

TPNCs and Their Messages for Form 709, United States Gift (and Generation-Skipping Transfer Tax Return
  1. The following information pertains to Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, Error Messages:

    Taxpayer Notice Code Taxpayer Notice Statement
    TPNC 10 We found an error in the computation of your taxable gifts for the current period.
    TPNC 11 We found an error in the computation of your total taxable gifts on Page 1, Part 2, Line 3.
    TPNC 12 We found an error in the computation of your tax on Page 1, Part 2, Line 4, Tax computed on the amount on Line 3.
    TPNC 13 We found an error in the computation of tax on Page 1, Part 2, Line 5, Tax computed on the amount on Line 2.
    TPNC 41 We found an error in the computation of the Unified Credit amount. The Unified Credit amount you reported was $n,nnn,nnn,nnn,nnn.nn. The amount we recomputed is $n,nnn,nnn,nnn,nnn.nn.

    Note:

    For Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, use this TPNC for 2011 revisions and prior ONLY.

    TPNC 42 We found an error in the computation of the marital deduction on Schedule A.
    TPNC 43 We found an error in the computation of the Applicable Credit amount. The Applicable Credit amount you reported was $n,nnn,nnn,nnn,nnn.nn. The amount we recomputed is $n,nnn,nnn,nnn,nnn.nn.

    Note:

    For Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, use this TPNC for 2012 revisions and subsequent.

    TPNC 48 We found an error in the generation-skipping transfer tax computation.
    TPNC 54 We found an error in the computation of the balance due or overpayment amount.
    TPNC 69 We found an error in the total gift tax computation on Page 1, Part 2, Line 6, Balance.
    TPNC 75 We found an error in the computation of Page 1, Part 2, Line 14, Total Credits.
    TPNC 76 The amount claimed as prepaid tax with the extension of time to file on Page 1, Part 2, Line 18 was incorrect.
    TPNC 79 We found an error in the computation of the total deductions amount on Page 3, Part 4, Line 8.
    TPNC 80 We found an error in the computation of the amount on Page 3, Part 4, Line 9.
    TPNC 81 We found an error in the computation of taxable gifts on Page 3, Part 4, Line 11.
    TPNC 83 We found an error in the computation of your total tax amount.
    TPNC 90 TPNC 90 is a blank notice that contains up to 10 blank lines which are available on the notice for whatever statement is needed. It is used when more than three math errors were made on the return or there is no math error code that meets the error condition on the return. The tax examiner will write exactly what should appear on the notice and attach it to the face of the return. Charge the return out and route directly to Notice Review and follow local procedures. Notice Review, or the responsible party, will type the math error explanation on the notice and mail it to the taxpayer.

    Note:

    In January 2014, the Taxpayer Notice Code (TPNC) 90 Math Error (ME) Code literals were programmed into the Online Notice Review (OLNR) Retype Application for Notice Review (NR). This addition will eliminate the need for the NR tax examiner to manually type the notice literal and reduce potential copying/typing incorrect paragraphs/messages in the notices. For a full listing of the programmed TPNC 90 Math Error Codes, see TPNC 90 Math Error Code Job Aid on Servicewide Electronic Research Program (SERP) at http://serp.enterprise.irs.gov/databases/portals.dr/sp-portal/bmf.dr/bmf_ers/job_aid.dr/TPNC-90-Math-Error-Code-Job-Aid.doc.

Status Codes

  1. Records for the documents in the Error Resolution System (ERS) are controlled by Status Codes. The status is updated when the record is placed in a specific inventory.

  2. Here is a list of the status codes with a brief explanation:

    1. Status 100, error awaiting correction. Records are in the Error Inventory.

    2. Status 2XX, record awaiting information. Records are in the Unworkable Suspense Inventory.

    3. Status 3XX, suspense period expired - no response. Records are in the Workable Suspense Inventory.

    4. Status 4XX, record with information, awaiting correction. Records are in the Workable Suspense Inventory.

    5. Status 900, Record is on the Unselected Inventory.

  3. The final two positions of the Status Code will consist of the first two positions of the AC. This will put similar work together on the Workable Suspense Inventory.

    Example:

    Status Code 321 means Suspense period expired, no response to taxpayer correspondence.

  4. Records whose Suspense Period has expired before being activated are automatically moved from Status 2XX to Status 3XX.

Unprocessables Automated Data Processing (ADP) Returns

  1. The following information pertains to unprocessables ADP returns:

    If Then
    A return cannot be perfected, and it is necessary to correspond, perform in-house research or send the document to another area of the submission processing campus Suspend the record to start the required action.
    Suspending unprocessables record Enter CC SSPND followed by the appropriate AC.
    The AC cannot describe the required action Attach a note of explanation to the return (use routing slip).
    The tax examiner will not be issuing a letter through IDRS
    1. Attach a Form 3693, Correspondence Action Sheet, to issue the correspondence.

    2. CC SSPND with AC 211 and attach appropriate Correspondence Action Sheet.

Working Trails

  1. You must leave a legible "Working Trail" for those who may work with the return later. If your submission processing campus has a written "In-house Agreement" that differs from the instructions below, follow them. These procedures have been coordinated with Headquarters.

  2. Annotate the following items when making a change to the return:

    • Social Security Number

    • Tax Period

  3. Edit on the return the preparation of Letter 3024C, Math Error Explained (BMF), and Form 2275, Records Request, Charge and Recharge.

Section 01 Data, Form 706, U.S. Estate Tax Return, General Information

  1. Section 01 has entity data, remittance, fields for codes, IRS received date, and miscellaneous information.

  2. The remittance field cannot be changed by Error Resolution examiners. This field must be blank on non-remittance returns and all numeric on remittance returns.

  3. The message "Unrecognizable Field error - Contact Supervisor" will appear when a return has neither CCC "G" or Section 04 and there is an entry in Field 01PI (Payment Indicator).

Error Record Format Section 01

  1. The Error Record Format for Section 01 is listed as follows:

    Field Designator on Form 706, U.S. Estate Tax Return Maximum Characters Field Name Location
    RMIT> 11 Remittance Green money, Page 1, Part 2, Line 20
    01NC 4 Name Control Check Digit Decedent's last name Page 1, Part 1, Box 1b
    >>>> 4 Name Control Underprint Computer Generated
    01SSN 9 Social Security No. Decedent's SSN, Page 1, Part 1, Box 2
    01DOB 8 Date of Birth Page 1, Part 1, Box 4
    01DOD 8 Date of Death Page 1, Part 1, Box 5
    >>>> 2 Fiscal Year Month (Gen) Computer Generated
    01CCC 10 Computer Condition Code Upper left margin
    01RCD 8 Received Date Date Stamp
    01PIC 1 Penalty and Interest Code Upper right margin
    01CAF 1 CAF Indicator Right margin, Page 1, Part 1, Box 6b
    01RFC 1 Refund Code Error Resolution only field
    01PSN 9 Preparer (PTIN) Bottom right corner, Page 1
    01PEN 9 Preparer EIN Bottom right corner, Page 1
    01PTN 10 Preparer Phone Number Bottom right corner, Page 1
    01PI 1 Payment Indicator Right margin, Page 1, Part 2, Line 19
    01CRD 8 Correspondence Rec'd date Left margin, left of Page 1, Part 2, Line 4
    01RD> 8 Return Due Date Computer Generated

RMIT> - Remittance

  1. This field is blank for non-remittance returns and remittance returns processed through the Remittance Processing System (RPS) system. It is a non-correctable field.

  2. The remittance amount is found on the Balance due line of a full-paid return and is shown by a green rocker. A partial paid return has the remittance amount entered in green beside the taxpayer's entry on the Balance Due Line.

Field 01NC - Name Control/Check Digit

  1. This field is transcribed from the name line in the entity portion of the return. This field must be the first four alpha characters of the decedent’s last name.

Invalid Conditions
  1. Field 01NC is invalid if:

    1. It is blank.

    2. The first position is not alpha.

    3. The second, third, and fourth positions are not alpha, hyphen or blank.

    4. There are any intervening blanks between characters.

Correction Procedures
  1. The following information pertains to correction procedures:

    If Then
    The name control has been transcribed incorrectly Enter the correct name control.
    The name control is missing and cannot be found Research using local procedures.
    Found Enter the correct name control in Field 01NC and on the return.
    Still unable to determine the name control Suspend the record with AC 320.

Field 01SSN - Social Security Number

  1. The SSN is a number assigned by the Social Security Administration (SSA) to identify potential Social Security contributors/recipients. The field is found on Page 1, Part 1, Box 2 of the return.

Invalid Conditions
  1. Field 01SSN is invalid if:

    1. It is blank.

    2. It is not all numerics.

    3. It is less than nine digits.

    4. It is all zeroes or nines.

Correction Procedures
  1. The following information pertains to correction procedures:

    If Then
    A valid SSN is not found
    1. Search for a correct number on the return or attachments.

    2. Research using IDRS to obtain a valid SSN.

    No SSN record is found or the SSN is invalid Suspend with AC 320 to secure a temporary SSN.
    The decedent has no SSN
    1. The executor is instructed to use the decedents EIN.

    2. Verify the number is an EIN using CC INOLEG.

    3. Suspend with AC 320 for referral to Entity Control for a temporary SSN.

    More than one SSN is found Suspend with AC 320 for referral to Entity Control.
    Entity Control has assigned an SSN
    1. Enter in Field 01SSN and on the return.

    2. Also enter the entity assignment date in Field 01CRD if it is after the return due date and the IRS received date.

Field 01DOB - Date of Birth

  1. This field is transcribed from Page 1, Part 1, Box 4 of the return. The Date of Birth (DOB) is either blank or numeric in YYYYMMDD format.

  2. The DOB is used as a validity check on the DOD.

Invalid Conditions
  1. Field 01DOB is invalid if:

    1. It is not all numerics.

    2. The month is not 01-12.

    3. The day is not valid for the month.

    4. Not in YYYYMMDD format.

Correction Procedures
  1. Check for coding or transcription errors and correct as needed.

  2. If the DOB cannot be found, blank the field.

Field 01DOD - Date of Death

  1. This field is transcribed from Page 1, Part 1, Box 5 of the return. It is entered in YYYYMMDD format.

  2. The DOD determines the due date of the return. It also determines which tax laws and rates are in effect for the estate.

  3. The following table pertains to due dates of returns:

    Exception:

    If the date of death is between January 1, 2010, and December 17, 2010 (inclusively); the return due date is September 19, 2011, as mandated in the Extender's Legislation (PL 111-312).

    Month of Death Month Due
    January October
    February November
    March December
    April January
    May February
    June March
    July April
    August May
    September June
    October July
    November August
    December September
  4. The following table provides examples of due dates:

    If Then
    DOD is 01-01-2010 thru 12-17-2010 (inclusively) Due date is 09-19-2011
    (per Extender's Legislation the date should be 09-17-2011, but that is a Saturday).
    DOD is 12-18-2010 thru 12-31-2010 Due date is 09-30-2011
    DOD is 05-31-15 Due date is 02-28-16
    DOD is 07-31-15 Due date is 04-30-16
    DOD is 10-31-15 Due date is 07-31-16
    DOD is 06-30-16 Due date is 03-31-17
    DOD is 08-31-16 Due date is 05-31-17
    DOD is 11-30-16 Due date is 08-31-17
    DOD is 05-31-17 Due Date is 02-28-18
    DOD is 10-31-17 Due Date is 04-30-18
    DOD is 06-30-18 Due Date is 03-31-19
    DOD is 08-31-16 Due Date is 05-31-19
Invalid Conditions
  1. Field 01DOD is invalid if:

    1. It is blank.

    2. It is not all numerics.

    3. The month is not 01-12.

    4. The day is not valid for the month.

    5. Not in YYYYMMDD format.

Correction Procedures
  1. Check for coding or transcription errors and correct as needed, taking the following action:

    If Then
    The DOD is blank, incomplete, or illegible on the return Check attachments or research CC INOLE for DOD.
    The DOD cannot be found Suspend with AC 211 and attach appropriate Correspondence Action Sheet.
    A reply to correspondence is not received The Reject function should enter a date nine months earlier than the IRS received date.

Field 01CCC - Computer Condition Codes (CCCs)

  1. CCCs tell the computer what to do when certain conditions are met. For example, CCC "R" stops the computer from calculating a delinquency penalty when the taxpayer presents reasonable cause for filing the return late.

  2. Since these codes tell the computer what to do, they also post to the Master File so that people looking at the file can tell what actions were taken on the return.

  3. CCCs are transcribed from the upper left hand corner of the return. The following CCCs will be used for Form 706, U.S. Estate Tax Return.

Invalid Conditions
  1. Field 01CCC is invalid if:

    1. Any letter or number other than the following is entered: B, D, G, L, O, R, W, X, Y, 3, and/or 7.

    2. CCC "G" is present with any other CCC except "W" .

    3. CCCs "D" , "R" , and "7" are all present.

Correction Procedures
  1. Check for coding and transcription errors and correct as needed.

  2. When the codes entered on the return are illegible or invalid, check the return to determine the correct code(s) and enter on the screen using the If/Then chart below.

    If Then
    Any other CCCs are present with "G" and "W" and/or "3" Delete the other codes if the "G" is needed.
    CCC "G" is not needed Delete it and leave the other codes. Review all sections and input data where necessary.
    CCCs "D" and "R" are present with CCC "7" Determine which is correct and delete the incorrect CCC.
  3. Since Form 706, U.S. Estate Tax Return, has 11 CCCs, and of these only a maximum of six can be valid at the same time, you should not see more than 10 codes. If you do, delete any invalid codes. Check the remaining codes to ensure that no other invalid conditions are met and delete any other invalid codes based on the instructions found in this paragraph.

CCC "B"
  1. B - Victims of Terrorism Relief - Enter CCC "B" when the Form 706, U.S. Estate Tax Return, is annotated at the top of Page 1 of the return with either references to "Section 2201" , or has any indications the return is in accordance with legislation impacting victims of terrorist attacks April 19, 1995 (Oklahoma City bombing), September 11, 2001 (World Trade Center bombing), or references to deaths resulting from anthrax that occurred on or after September 11, 2001, and before January 1, 2002.

CCC "D"
  1. D - Reasonable cause for failure to pay taxes timely - Enter CCC "D" on a delinquent balance due return when the taxpayer has attached a statement establishing a reasonable cause for their failure to make payments. Follow the If/Then for further processing:

    If Then
    Precomputed penalty is shown on the return Do not edit CCC "D" .
    The taxpayer's explanation for failure to pay timely is unacceptable and reasonable cause is not established
    1. Do not edit CCC D to the return.

    2. Instead, correspond and tell the taxpayer why their explanation was not accepted, and inform them of the available appeal rights.

    3. Letter 854C, Penalty Waiver or Abatement Disallowed/Appeals Procedure Explained, may be used for this purpose. See IRM 20.1, Penalty and IRM 20.2, Interest, for reasonable cause criteria.

    Note:

    In cases involving failure to pay and failure to file/delinquency, the Compliance Services, Estate and Gift Tax Campus Operation may make the determination regarding reasonable cause for both. Edit the return accordingly.

CCC "G"
  1. G - Amended Return - CCC "G" should be entered on returns marked "Amended" , "Superseding" , "Duplicate" , "Corrected" , "Supplemental" , etc. CCC "W" and/or "3" can be used with a CCC "G" .

    Note:

    Taxpayers may send a copy of the front page of their return with a payment. These copies may get numbered and processed. If correspondence is needed for missing information and the return is marked "COPY" , research BMFOLI/BMFOLT and/or BRTVU for duplicate returns.

CCC "L"
  1. L - Treaty Based Positions.

  2. The filer has written IRC 6114, Elections on the return or Form 8833, Treaty-Based Return Position Disclosure Under IRC 6114 or IRC7701(b) elections, is attached to the return, Enter CCC L.

CCC "O"
  1. O - Module Freeze.

  2. A completed Form 3753, Manual Refund Posting Voucher, or Form 5792, Request for IDRS Generated Refund (IGR), is attached to the return

    1. Enter CCC O. If the refund is $1,000,000 or more, enter a 1 in Field 01RFC

    2. These show that a pre-settlement manual refund was made. (The freeze is released by posting TC 840.)

  3. The Refund Code of "1" is entered by Error Resolution in Field 01RFC to show that a refund of $1,000,000 or more has been issued.

    Note:

    Field 01RFC is an "Error Resolution Only" input field.

  4. Due to the large amounts of interest we (IRS) would pay if a refund of this size is not handled timely, these returns will have the refund processed manually.

    Note:

    See IRM 3.12.263.3.2.2, Refund Returns (45 day jeopardy and 10 million dollar returns)to ensure the refund is issued timely.

CCC "R"
  1. R - Reasonable cause for delinquency. Take the following Action:

    If Then
    Taxpayer has attached a statement establishing reasonable cause for delinquency
    1. Detach statement and send copies of Pages 1 and 2 of Form 706, U.S. Estate Tax Return, to the Compliance Services, Estate and Gift Tax Campus Operation.

    2. Process return as normal.

    3. Compliance Services, Estate and Gift Tax Campus Operation will make the determination (of reasonable cause).

    4. Enter the appropriate CCC (e.g., "R" (for "reasonable cause" ) or "7" (for "reasonable cause denied" )).

    Note:

    The Compliance Services, Estate and Gift Tax Campus Operation will make determinations in cases regarding reasonable cause for failure to file or delinquency situations ONLY. (See instructions contained in IRM 3.11.106.5, Computer Condition Codes (CCCs), regarding handling of reasonable cause and the coding of CCCs "R" , and "7" ).

CCC "W"
  1. W - Cleared by Statute - The following instructions pertain to returns which were reviewed and cleared by Statute Control.

    If Then
    The return has been stamped "Cleared by Statute"
    1. Enter CCC "W" .

    2. A return that has been cleared by the Statute Control function will be stamped "Cleared by Statute" .

CCC "X"
  1. X - Return Settlement Frozen - The following instructions describe the application and correction of CCC "X" (Return Settlement Frozen).

    If Then
    Taxpayer indicates that excess remittance with return or overpayment be applied to another account Enter CCC "X" .
CCC "Y"
  1. CCC "Y" is used to denote Assistance Needed/Special Handling Returns, Combat Zone Returns, Early-Filed Returns, and Gift Tax Paid.

  2. Combat Zone Returns - returns of citizens or residents of the United States who were killed in action or who died as a result of wounds, disease or injury received while serving in a Combat Zone. The decedent is entitled to lower estate tax per IRC 2201 and IRC 2011(d). The tentative tax equals 125% of the maximum allowable state death tax credit. All other credits against estate tax (including the Unified/Applicable Credit) apply to these returns.

  3. These estates have their own tax schedule, so Error Resolution must compute tax manually.

CCC "3"
  1. "3" - No Reply to Correspondence - Suppress Credit Interest. Enter this code to suppress credit interest from being generated when no reply is received for correspondence sent to the taxpayer.

CCC "7"
  1. "7" - Reasonable Cause Statement Denied - Use when the taxpayer's statement for failure to file or pay taxes timely does not meet reasonable cause criteria. (Compliance Services, Estate and Gift Tax Campus Operation will make the determinations of reasonable cause in cases involving Form 706, U.S. Estate Tax Return and Form 709, United State Gift (and Generation-Skipping Transfer) Tax Return, situations. See instructions in IRM 3.11.106, Estate and Gift Tax Returns.)

    Note:

    Beginning with Form 4768, Application for Extension of Time To File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes, filed for estate returns due after July 25, 2001, an executor may apply for an automatic six month extension of time to file Form 706, U.S. Estate Tax Return, if the Executor files Form 4768, Application for Extension of Time to File a Return and Pay Estate (and Generation-Skipping Transfer)Taxes, by checking the designated box and completing the form as instructed. An extension of time to file does not extend the time to pay. Take the following action listed in the If/Then Chart.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the executor of a 2010 estate who files a Form 4768, Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, by the due date for filing Form 706, United States Estate Tax Return, or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, both an automatic six month extension of time to file Form 706, U.S. Estate Tax Return, or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, pursuant to Section 6081, and a six month extension of time to pay the estate tax. The executor of a 2010 estate is not required to substantiate on the Form 4768, Application for Extension of Time to File a Return(and Generation-Skipping Transfer) Taxes, the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768), Application for Extension of time to File a Return (and Generation-Skipping Transfer) Taxes, justification needs to be provided.

    If Then
    CCCs "D" and "R" are present Do not enter CCC "7" if both are present. However, CCC "7" may be present with either CCC "D" OR"R" , but not with both codes simultaneously. Use Letter 854C, Penalty Waiver or Abatement Disallowed/Appeals Procedure Explained, to notify the taxpayer of the denial.

Field 01RCD - Received Date

  1. The IRS received date is used to determine if penalties such as failure to file or pay apply, and if so, helps to determine the amount of the penalty. It is also used to provide certain validity checks. This field is transcribed from the stamped or edited date in the center of Page 1 of Form 706. The IRS received date is entered in YYYYMMDD format and must be present on all Form 706, U.S. Estate Tax Return.

Invalid Conditions
  1. Field 01RCD is invalid if:

    1. It is not present.

    2. It is not all numerics.

    3. The month is not 01-12.

    4. The day is not valid for the month.

    5. It is not in YYYYMMDD format.

    6. It is prior to the ADP date (January 1, 1962).

    7. The IRS received date is after the processing date.

Correction Procedures
  1. Check for coding or transcription errors and correct as needed.

  2. IRS received date: This date must be present on all returns. If the date has not been stamped or edited on the first page of the return, research return and attachments and see procedures below. Enter it in YYYYMMDD format. Caution should be taken to determine when a return was filed or became processable. Determine received date from return or attachments in the following priority:

    • IRS date stamp

      Note:

      Earliest date stamp by Submission Processing Campus, Area Office, U.S. Consulate, or Revenue Officer.

    • Service Center Automated Mail Processing System (SCAMPS) digital date.

    • Postmark date on envelope

    • Designated private delivery service

    • Signature date

    • Julian date minus 10 days

    Caution:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ despite Saturday, Sunday or holiday extension dates. If the form is date stamped ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ . If that date shows legal timely mailing without regard to a due date falling on Saturday, Sunday or holidays, change the IRS received date to the postmark date.

    Reminder:

    The Treasury Department and IRS believe it is reasonable to grant the estates of 2010 decedents an automatic extension of time to file the estate tax return and an extension of time to pay the estate tax. Accordingly, the Treasury Department and IRS grant the executor of a 2010 estate who files a Form 4768, Application for Extension of Time to File a Return(and Generation-Skipping Transfer) Taxes, by the due date for filing Form 706, U.S. Estate Tax Return or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, both an automatic six month extension of time to file Form 706, U.S. Estate Tax Return or Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return, pursuant to Section 6081, and a six month extension of time to pay the estate tax. The executor of a 2010 estate is not required to substantiate on the Form 4768, Application for Extension of Time to File a Refund (and Generation-Skipping Transfer) Taxes, the reason for requesting an extension of time for payment of the estate tax to receive the six month extension of time to pay the estate tax due. If the executor (of a 2010 decedent) requests an extension of time to pay for more than six months (on Form 4768 ), Application for Extension of Time to File a Return (and Generation-Skipping Transfer) Taxes, justification needs to be provided. Take the action listed below.

    Note:

    If both U.S. Postal Service and private meter marks are present, honor the U.S. Postal Service marks.

    If Then
    More than one date is stamped Use only the earliest date.
    A return has been identified as unprocessables and the taxpayer has been contacted for additional information Do not change the original IRS received date, but also enter correspondence received date (Field 01CRD).
  3. Private Delivery Services - A Private Delivery Service (PDS) is a business which delivers packages. The timely mailing as timely filing rule now applies to some PDSs. When the rule applies to a PDS, it is referred to as an IRS designated PDS. Only use marks from a designated PDS to determine the IRS received date.

    Note:

    Private delivery services do not deliver to PO boxes. Taxpayers must use the U.S. Postal Service to mail any item(s) to an IRS PO Box address.

Field 01PIC - Penalty and Interest Code

  1. The Penalty and Interest Code is transcribed from the top right hand corner of Form 706, U.S. Estate Tax Return, Field 01PIC should be coded "1" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and displays an amount for precomputed penalty and interest.

Invalid Condition
  1. Field 01PIC is invalid if it is other than blank or "1" .

Correction Procedures
  1. Check for coding or transcription errors and correct as needed.

♦Field 01CAF - CAF Indicator♦

  1. Editing of CAF codes is no longer required.

  2. Form 2848, Power of Attorney and Declaration of Representative (POA), and Form 8821, Tax Information Authorization (TIA), are forwarded to the Central Authorization File Unit (CAF) by the Code and Edit function.

Invalid Condition
  1. Field 01CAF is invalid if it contains any entry.

Correction Procedures
  1. If a code is present on the screen, clear Field 01CAF.

  2. Leave a "limited" POA attached to the return. A "limited" POA restricts the authorization to the preparation of the return to which it is attached.

  3. Original documents, photocopies, or documents submitted by facsimile transmission (FAX) are acceptable for processing.

  4. The Form 2848, Power of Attorney and Declaration of Representative, and Form 8821, Tax Information Authorization, should contain the following information:

    • The name, SSN and address of the taxpayer

    • The name and address of the designated representative Power of Attorney (POA) or appointed Tax Information Authorization (TIA)

    • The type of return (individual, corporate, etc.) and the tax form number

    • The tax year(s) or period(s)

    • The taxpayer's signature and date of signature

    • For Form 2848, Power of Attorney and Declaration of Representative, only, a signed and dated declaration of good standing from the representative

    Note:

    You may not send refunds to appointees named on a Tax Information Authorization(TIA). Route the authorization to the submission processing campus CAF function for further processing.

  5. If the POA/TIA is received, not attached to any return or document, route it to the Submission Processing Campus CAF function. If the authorization is attached to the correspondence, review the correspondence to determine if other requests were made. If they were, photocopy the correspondence and send the copy along with the authorization to the CAF function for processing. If not, send correspondence and authorization to the CAF function for processing.

  6. Do not detach and send POAs/TIAs filed for specific issues unless the document authorizes recognition for a return besides the specific issue. In that case, a copy of the POA/TIA should be sent to the CAF function to input the return portion by the CAF system. Examples of specific issues include but are not limited to the following:

    • Form 843, Claim for a Refund and Request for Abatement.

    • Form SS-4, Application for Employer Identification Number.

  7. "General Powers of Attorney" or "Durable Powers of Attorney" do not contain sufficient information to process on CAF and should be retained in the case file or left attached to the related return. However, if a general or durable power of attorney is submitted with a completed Form 2848Power of Attorney and Declaration of Representative,(a transmittal power of attorney), send both forms to the CAF function for processing.

Field 01RFC - Refund Code (Error Resolution Only Input)

  1. The Refund Code of "1" is entered only by Error Resolution in Field 01RFC to show that a refund of $1,000,000 or more has been issued.

    Note:

    Enter CCC "O" in Field 01CCC when either a completed, Manual Refund Posting Voucher, or Form 5792, Request for IDRS Generated Refund (IGR), are attached to the return, if this has not already been done. The entries in these fields show that a pre-settlement manual refund was made. (The freeze is released by posting a Transaction Code "840" .) See IRM 3.12.263.3.2.2, Refund Returns (45 day jeopardy and 10 million dollar returns) to ensure the refund is issued timely.

  2. Due to the large amounts of interest we (IRS) would pay if a refund of this size is not handled timely, these returns will have the refund processed manually.

Invalid Condition
  1. Field 01RFC is invalid if it contains a numeric entry other than a blank or "1" .

Correction Procedures
  1. Verify that the refund is for $1,000,000 or more and that a manual refund has been prepared, then enter a "1" in Field 01RFC.

  2. If the refund has not been issued, SSPND using AC 341, Attach routing slip, and note Manual Refund

♦Field 01PSN-Preparer's Tax Identification Number (PTIN)♦

  1. The Preparer's SSN (2009 and prior revisions) or Preparer's Tax Identification Number (PTIN) is located to the right of the Preparer's Signature at the bottom right corner of Form 706, U.S. Estate Tax Return, (Page 1).

  2. The Preparer's SSN must be a nine digit numeric character. The SSN cannot be all zeros or nines.

  3. A PTIN is a valid entry in the Preparer's Social Security Number area at the bottom of Form 706, U.S. Estate Tax Return. The PTIN is an eight digit number preceded by the alpha "P" (e.g., PXXXXXXXX).

  4. Delete the Preparer's SSN or PTIN if it is invalid.

♦Field 01PEN-Firm's EIN)♦

  1. The Firm's EIN (EIN-2009 and prior revisions) is located below the Preparer's PTIN box (Preparer's SSN or PTIN box for 2009 and prior revisions) at the bottom right corner of Form 706, U.S. Estate Tax Return, (Page 1).

  2. The Firm's EIN must be a nine digit numeric character. The EIN cannot be all zeros or nines.

  3. Delete the Preparer's EIN if it is invalid.

♦Field 01PTN-Preparer Phone Number♦

  1. The Paid Preparer's Phone Number is located below the Firm's EIN (EIN for 2009 and prior revisions) at the bottom right corner of Form 706, U.S. Estate Tax Return, (Page 1).

  2. No action is required on amended returns.

  3. If a complete Paid Preparer's Phone Number is located elsewhere on the return or attachments, edit to the "Phone no." line.

  4. If a complete Paid Preparer's Phone Number is not located or the number is illegible, delete the incomplete or illegible phone number.

Field 01PI - Payment Indicator

  1. This field is transcribed from the bottom right margin of Page 1, Part 2, Line 20 of Form 706, U.S. Estate Tax Return. (This information was transcribed from Line 25 on returns for Tax Years 2002 through 2004, Line 27 on returns for Tax Years 1998 through 2001 and from Line 28 on Form 706, U.S. Estate Tax Return, for 1997 and prior years.)

  2. This indicator shows when installments and/or deferments are granted, and/or when U.S. Treasury bonds are submitted in payment of the estate tax.

    Note:

    Currently, only PI codes "0" and "1" are being used. See IRM 3.12.263.4.15.2, Field 01PI-Payment Indicator Correction Procedures.

Invalid Conditions
  1. Field 01PI is invalid if it is blank (other than for valid "G" coded returns), or the field contains anything but a 0 or 1 (2, 3, 4, 5, 6, or 7 for tax years 2004 and prior).

Correction Procedures
  1. PI Codes are entered on Form 706, U.S. Estate Tax Return, in the following priority:

    1. For balance due returns, use a "1" code if the taxpayer has checked the "Yes" box for Section 6166 or 6163 on Page 2, Part 3, Line 3, Line 4, or has an attachment requesting deferment or installments citing these Sections.

    2. For refund/zero liability returns, or for Balance Due returns on which the taxpayer is not requesting deferment of installments, use a "0" (zero) code.

      Note:

      The only PI codes now used will be "0" and "1" .

Field 01CRD - Correspondence Received Date

  1. When needed the correspondence received date is edited in YYYYMMDD format.

  2. The 45 day interest free period for processing refund returns does not begin until we receive the return in a processable format. If we correspond for missing information, the correspondence received date must be input to the Master File for the purpose of computing credit interest.

Invalid Conditions
  1. Field 01CRD is invalid if:

    1. It is not in YYYYMMDD format.

    2. It is not numeric.

    3. The month is not 01-12.

    4. The day is not valid for the month.

    5. 01CRD is not greater than the IRS received date.

    6. 01CRD is not greater than the return due date.

    7. 01CRD is greater than the processing date.

Correction Procedures
  1. Check for coding and transcription errors and correct as needed using the following instructions:

    If Then
    No reply or the correspondence was undeliverable Enter CCC "3" in Field 01CCC. NOTE: This will suppress credit interest from being generated.
    Entity Control has assigned an SSN to the return If Entity has edited an "A" or "E" in left margin of the return, enter the Entity Assignment Date in Field 01CRD if it is later than the IRS received date and return due date.
    The taxpayer replies to our request for missing information Enter the correspondence received date in Field 01CRD if the correspondence was necessary and was received after the return due date. See IRM 3.12.38.19.8, determining the correspondence received date.

Field 01RD> - Return Due Date

  1. This is a computer-generated field that calculates the return due date as nine months after the DOD in YYYYMMDD format.

    Exception:

    If the date of death is between January 1, 2010, and December 17, 2010 (inclusively); the return due date is September 19, 2011, as mandated in the Extender's Legislation (PL 111-312).

  2. This field is used to determine if a return is filed timely. If the return is filed late, it is used to calculate any applicable penalties and interest.

Invalid Conditions
  1. None. (This is a computer-generated field.)

Correction Procedures
  1. None.

Section 02 Data, Form 706, U.S. Estate Tax Return, General Information

  1. Section 02 field designators, line numbers, field lengths and titles are listed below. It is transcribed in dollars and cents or dollars only, whichever is applicable. Field 0203C may be positive or zero (0). Section 02 cannot be present on a "G" coded amended return (delete if present).

Processing Field Errors

  1. Correct transcription errors if the field is not entirely numeric.

  2. If the money amounts on a return exceed the maximum field length allowable, take the following action:

    1. Enter the maximum amount allowable on the original return. Recompute the tax data and enter the corrected amount(s) on the screen display and the return. DO NOT SEND A TAXPAYER NOTICE CODE to the taxpayer.

    2. Write on the original return, "Dummy Return prepared due to overflow document" .

    3. Prepare a "Dummy Return" by computing and entering the remaining overflow money amount(s) for the correct fields. On the top of the return write "Prepared from Overflow Return" ; write the entity data and DLN from the original return; enter CCC "G" in Field 01CCC; and write "Signature on Original Return" in the signature area.

    4. Attach routing slip to the completed "Dummy Return" and send to Receipt and Control to have the "Dummy Return" numbered and processed.

Error Record Format - Section 02

  1. The Error Record Format for Section 02 is listed as follows:

    Field
    Designator
    Maximum
    Characters
    Field Name Location
    0201 12 Total Gross Estate Page 1, Part 2, Line 1
    0202 12 Total Allowable Deductions Page 1, Part 2, Line 2
    0203A 12 Tentative Taxable Estate Page 1, Part 2, Line 3a
    >>>> 12 Tentative Taxable Estate
    Computer Generated
     
    0203B 12 State Death Tax Deduction Page 1, Part 2, Line 3b
    0203C 12 Taxable Estate Page 1, Part 2, Line 3c
    >>>> 12 Taxable Estate
    Computer Generated
     
    0204 12 Adjusted Taxable Gifts Page 1, Part 2, Line 4
    0205 12 Net Taxable Estate Page 1, Part 2, Line 5
    >>>> 12 Net Taxable Estate
    Computer Generated
     
    0206 12 Tentative Tax Page 1, Part 2, Line 6
    >>>> 12 Tentative Tax
    Computer Generated
     
    02GTT 12 Gross Tax Tentative Page 1, Part 2, Line 7a (Tax Years 2001 and prior)
    02NTT 12 Net Tax Tentative Page 1, Part 2, Line 7b (Tax Years 2001 and prior)
    >>>> 12 Net Tax Tentative
    Computer Generated
     
    02TNT 12 Total Net Tax Tentative Page 1, Part 2, Line 7c (Tax Years 2001 and prior)
    >>>> 12 Total Net Tax Tentative
    Computer Generated
     
    02TTT 12 Total Transfer Taxes Tentative Page 1, Part 2, Line 8 (Tax Years 2001 and prior)
    >>>> 12 Total Transfer Taxes Tentative
    Computer Generated
     
    0207 12 Aggregate Gift Tax Page 1, Part 2, Line 7
    0208 12 Gross Estate Tax Page 1, Part 2, Line 8
    >>>> 12 Gross Estate Tax
    Computer Generated
     
    0209 12 Unified Credit (2011 and prior revisions) Page 1, Part 2, Line 9
    >>>> 12 Unified Credit (2011 and prior revisions)
    Computer Generated
     
    0209A 15 Basic Exclusion Amount Page 1, Part 2, Line 9a
    0209B 15 DSUE Amount Page 1, Part 2, Line 9b
    0209C 15 Restored Exclusion Amount Page 1, Part 2, Line 9c
    >>>> 15 Applicable Restored Exclusion Amount  
    0209D 15 Applicable Exclusion Amount Page 1, Part 2, Line 9d
    >>>> 15 Applicable Exclusion Amount
    Computer Generated
     
    0209E 15 Applicable Credit Amount Page 1, Part 2, Line 9E
    >>>> 15 Applicable Credit Amount
    Computer Generated
     
    0210 12 Adjustment to Unified/Applicable Credit Page 1, Part 2, Line 10
    0211 12 Allowable Unified/Applicable Credit Page 1, Part 2, Line 11
    >>>> 12 Allowable Unified/Applicable Credit
    Computer Generated
     
    0212 12 Balance After Unified/Applicable Adjustment Page 1, Part 2, Line 12
    >>>> 12 Balance After Unified/Applicable Adjustment
    Computer Generated
     
    02TBA 12 State Death Tax Credit (Table B amount) Page 1, Part 2, Line 13A (Tax Years 2002-2004) (new Table B figure preceding
    Line 13 (Page 1, Form 706.
    >>>> 12 State Death Tax Credit
    Computer Generated
     
    02SDC 12 State Death Tax Credit Page 1, Part 2, Line 13B (Tax Years 2002-2004)
    >>>> 12 State Death Tax Credit
    Computer Generated
     
    02BSD 12 Balance After State Death Tax Credit Page 1, Part 2, Line 14 (Tax Years 2002-2004)
    >>>> 12 Balance After State Death Tax Credit
    Computer Generated
     

Field 0201 - Total Gross Estate

  1. This field is transcribed from Page 1, Part 2, Line 1, of the return and is verified by Code and Edit tax examiners. It is transferred from Page 3, Part 5, Item number 13, of the Recapitulation schedule. The amount transcribed will be either the taxpayer's amount or the examiner's corrected amount. It must be entered in dollars and cents or dollars only, whichever is applicable.

  2. This line shows the total amount of assets owned by the decedent at death. After deductions are taken and certain gifts given during life are added back, this amount provides the basis upon which the estate tax (before credits or other adjustments) is calculated.

Invalid Conditions
  1. Field 0201 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0202 - Total Allowable Deductions

  1. This field is transcribed from Page 1, Part 2, Line 2 of the return and is verified by Code and Edit examiners. It is transferred from Page 3, Part 5, Item number 24 of the return. The amount transcribed will be either the taxpayer's amount or the examiner's corrected amounts.

  2. After allowable deductions are taken and certain gifts given during life are added back, this amount provides the basis upon which the estate tax (before credits or other adjustments) is calculated.

Invalid Condition
  1. Field 0202 is invalid if it is not all numeric or exceeds 9,999,999,999.99.

Field 0203A - Tentative Taxable Estate

  1. This field is transcribed from Page 1, Part 2, Line 3a of the return. It is computed by subtracting Page 1, Part 2, Line 2 from Line 1 (Fields 0202 and 0201). This field can be positive or zero.

Invalid Conditions
  1. Field 0203A is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0203B - State Death Tax Deduction

  1. This field is transcribed from Page 1, Part 2, Line 3b of the return. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  2. The state death tax credit for taxpayers’ dying after December 31, 2004 was repealed. In 2005 the State Death Tax Deduction against the value of the gross estate replaced the state death tax credit.

Invalid Conditions
  1. Field 0203B is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0203C - Taxable Estate

  1. This field is transcribed from Page 1, Part 2, Line 3c of the return. It is computed by subtracting Page 1, Part 2, Line 3b from Line 3a (Fields 0203B and 0203A). This field can be positive or zero.

  2. This is the amount on which, after certain gifts given during life are added back, the estate tax (before credits or other adjustments) is calculated.

Invalid Conditions
  1. Field 0203C is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0204 - Adjusted Taxable Gifts

  1. This field is transcribed from Page 1, Part 2, Line 4 of the return. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  2. Estate and gift taxes have a unified tax structure. Tax is calculated on assets given as gifts after December 31, 1976, as well as assets owned at death. Therefore, those gifts not excludable under the Internal Revenue Code must be added to the taxable estate to determine the amount upon which estate tax can be imposed.

Invalid Conditions
  1. Field 0204 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0205 - Net Taxable Estate

  1. This field is transcribed from Page 1, Part 2, Line 5 of the return. It is computed by adding Page 1, Part 2, Lines 3C and 4 (Fields 0203C and 0204).

  2. This is the amount on which the tentative tax is calculated.

Invalid Conditions
  1. Field 0205 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0206 - Tentative Tax

  1. This field is transcribed from Page 1, Part 2, Line 6. The computer figures the tax in this field by using the amount in Net Taxable Estate Computer and Tax Table A on Page 4 of the instructions.

  2. This is the basic estate tax, subject to adjustments.

Invalid Conditions
  1. Field 0206 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0207 - Aggregate Gift Tax

  1. This field is transcribed from Page 1, Part 2, Line 7. It is the total amount of gift tax payable on gifts made after December 31, 1976.

  2. Taxable gifts made after December 31, 1976, are taken into account in computing the estate tax upon death. The gift and estate taxes are not separate taxes. Rather, they are designed to impose a tax or transfer of assets, whether made during life or upon death. This line gives a credit against estate tax for gift taxes payable. Were this not so, an individual would have to pay tax on the gift twice, once when he/she made the gift and again at death.

Invalid Conditions
  1. Field 0207 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0208 - Gross Estate Tax

  1. This field is transcribed from Page 1, Part 2, Line 8 (Field 0208). It is computed by subtracting Page 1, Part 2, Line 7 from Line 6 (Fields 0207 and 0206).

  2. See IRM 3.12.263.5.11, Field 0207-Aggregate Gift Tax, for the reasons this field allows gift taxes paid to be subtracted from estate tax.

Invalid Conditions
  1. Field 0208 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0209 - Unified Credit (2011 and prior revisions)

  1. This field is transcribed from (2011 and prior revisions) Page 1, Part 2, Line 9 (Field 0209). The computer will math verify this field by using the DOD (Field 01DOD) and the Unified Credit amounts.

  2. The Unified Credit is similar to the standard deduction or personal exemptions allowed on an individual income tax return. Individuals do not pay income tax on income that is less than the total amount of the standard deduction or personal exemptions. Nor do they pay estate or gift taxes on gifts or bequests whose total tax is less than the Unified Credit. There are 2 differences between the Unified Credit and the standard deduction/personal exemption. First the Unified Credit is a credit against tax, not a deduction from income or assets. The credit is subtracted against the estate tax, not the total amount of the estate. Second, the Unified Credit is much larger than the standard deduction/personal exemption.

Invalid Conditions
  1. Field 0209 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0209A - Basic Exclusion Amount

  1. This field is transcribed from Page 1, Part 2, Line 9a and is valid for DOD in 2012 and subsequent.

Invalid Conditions
  1. Field 0209A is invalid if it is not all numeric or exceeds $9,999,999,999.99.

    Note:

    For DOD in 2016, the Basic Exclusion Amount is $5,450,000 (for 2015, the Basic Exclusion Amount is $5,430,000). If 0209A exceeds that amount then both 0209A and 01DOD are set to error.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0209B - DSUE Amount

  1. This field is transcribed from Page 1, Part 2, Line 9b and is valid for Date of Death in 2012 and subsequent revisions of Form 706, U.S. Estate Tax Return.

  2. If the decedent had a spouse who died on or after January 1, 2011, whose estate did not use all of its applicable exclusion against gift or estate tax liability, a Deceased Spousal Unused Exclusion (DSUE) amount may be available for use by the decedent's estate. If the predeceased spouse died in 2011, the DSUE amount was calculated and attached to his or her Form 706, U.S. Estate Tax Return. If the predeceased spouse died in 2012 or after, this amount is found in Part 6, Section C of the Form 706, U.S. Estate Tax Return, filed by the estate of the decedent's predeceased spouse. The amount to be entered on line 9b is calculated in Part 6, Section D.

Invalid Conditions
  1. Field 0209B is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0209C - Restored Exclusion Amount

  1. This field is transcribed from Page 1, Part 2, Line 9c and is valid for DOD in 201110 and Later.

Invalid Conditions
  1. Field 0209C is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0209D - Applicable Exclusion Amount

  1. This field is transcribed from Page 1, Part 2, Line 9d and is valid for DOD in 2012 and subsequent.

Invalid Conditions
  1. Field 0209D is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0209E - Allowable Unified/Applicable Credit Amount

  1. This field is transcribed from Page 1, Part 2, Line 9E

Invalid Conditions
  1. Field 0209E is invalid if it is not all numeric or exceeds $9,999,999,999.99

Correction Procedures
  1. Check for coding and transcription error and correct as needed.

Unified/Applicable Credit Table

  1. The Unified/Applicable Credit for the following years is:

    Year
    (Date of Death)
    Applicable Credit Amount
    (Estate Tax Only)
    Basic Exclusion Amount
    1987 thru 1997 192,800 600,000
    1998 202,050 625,000
    1999 211,300 650,000
    2000 and 2001 220,550 675,000
    2002 and 2003 345,800 1,000,000
    2004 and 2005 555,800 1,500,000
    2006 thru 2008 780,800 2,000,000
    2010 and 2011* 1,730,800* 5,000,000
    2012** 1,772,800** 5,120,000
    2013** 2,045,800** 5,250,000
    2014** 2,081,800** 5,340,000
    2015** 2,117,800** 5,430,000
    2016** 2,125,800** 5,450,000
    2017 2,141,800** 5,490,000

    Note:

    If the amount in Field 0209 (Unified Credit - 2011 and prior returns) is lower than the maximum amount of Unified Credit allowed for that year, the taxpayer may have filed a Schedule T (Qualified Family-Owned Business Interest (i.e., QFOBI). If a Schedule T was filed, or if Line 24 (Page 3, Part 5 (Recapitulation), Form 706) contains an entry, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    *2011 entries for Field 0209 (Unified Credit - 2011 and prior returns) can be greater than the amount from the table's middle column because of the Portability election.

    ** For 2012 and subsequent years, Field 0209A (Basic Exclusion Amount) should equal the amount on the table's right column. Field 0209E (Applicable Credit Amount) may be greater than the amount from the table's middle column because of the Portability election.

Field 0210 - Adjustment to Unified/Applicable Credit

  1. This "dual use" field is transcribed from Page 1, Part 2, Line 10. The maximum allowable credit is $6,000 for this field. "Dual use" meaning either term will be correct for programming purposes.

  2. At the time the current Unified/Applicable Credit system was created, Congress provided that the taxpayer's use of the former gift tax exemption for gifts made between September 8 and December 31, 1976, would result in an adjustment to the Unified/Applicable Credit applicable to the taxpayer's transfers after 1976 (reduction in Unified/Applicable Credit is 20% of exemption claimed).

Invalid Conditions
  1. Field 0210 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0211 - Allowable Unified/Applicable Credit Amount

  1. This "dual use" field is transcribed from Page 1, Part 2, Line 11. It is computed by subtracting Page 1, Part 2, Line 10 from Line 9e (Line 9 for 2011 and prior revisions) (Fields 0210 and 0209e).

  2. At the time the Applicable Credit was created, Congress provided that the taxpayer's use of the former gift tax exemption for gifts made between September 8, and December 31, 1976, would result in an adjustment to the Applicable Credit applicable to the taxpayer's transfers after 1976.

Invalid Conditions
  1. Field 0211 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0212 - Balance after Unified/Applicable Adjustment

  1. This field is transcribed from Page 1, Part 2, Line 12. It is computed by subtracting Page 1, Part 2, Line 11 from Line 8 (Fields 0211 and 0208).

  2. This field allows the Unified/Applicable Credit, as adjusted, to be subtracted from the estate tax.

Invalid Conditions
  1. Field 0212 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02TBA - Table B State Death Credit Tax

  1. This field is only used for returns with a DOD prior to 2005. Line 13 (Field 02TBA) was deleted along with former Line 14 (Field 02BSD) after tax year 2004.

  2. This field is transcribed from the dotted line to the right of the arrow on Line 13 ("Table B" amount) Page 1, Part 2, Line 13A of the (Tax Years 2002 through 2004) return. This field is based on the tax from Table B on the Line 3 (Taxable Estate) amount. (This dotted line first appeared on the revision of Form 706, U.S. Estate Tax Return, for Tax Year 2002 as a means of reducing the amount of state death tax allowed.)

  3. Most states impose some sort of tax on assets transferred at death. This can take the form of an estate tax (the estate pays tax on assets) or an inheritance tax (the heirs pay tax on what they receive), or both. A credit is allowed on these taxes paid against the federal estate tax up to a certain percentage limitation.

  4. On June 7, 2001, the President signed into law Pub. L. No. 107-16, 115 Stat. 38 (2001), entitled, "The Economic Growth and Tax Relief and Reconciliation Act of 2001" , made changes to the Estate and Gift Tax Program. This legislation phased out the Estate at a maximum rate 35% after 2009 and repealed the State Death Tax Credit in 2005. The State Death Tax Credit is reduced as follows:

    • 25% reduction (for decedents dying during 2002)

    • 50% reduction (for decedents dying during 2003)

    • 75% reduction (for decedents dying during 2004)

    • 0% reduction (for decedents dying during 2005).

      Note:

      State Death Taxes Paid are now claimed as a deduction on Schedule K.

Invalid Conditions
  1. Field 02TBA is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02SDC - State Death Tax Credit

  1. This field is only used for returns with a DOD prior to 2005. Line 13 (Field 02SDC) was deleted along with Line 14 (Field 02BSD) after Tax Year 2004.

  2. This field is transcribed from Page 1, Part 2, Line 13 (Tax Years 2002 through 2004) of the return. (This line is the old Line 15 of Form 706, U.S. Estate Tax Return, to assist in calculating the decrease in (and eventual repeal of) the State Death Tax Credit, based upon Section 531 of the Economic Growth and Tax Relief Reconciliation Act of 2001.)

  3. The State Death Tax Credit is being reduced as follows:

    • 25% reduction (for decedents dying during 2002)

    • 50% reduction (for decedents dying during 2003)

    • 75% reduction (for decedents dying during 2004)

    • Finally, repealed (for decedents dying during 2005)

Invalid Conditions
  1. Field 02SDC is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02BSD - Balance after State Death Tax Credit

  1. This field is only used for returns with a DOD prior to 2005. Line 14 (Field 02BSD) was deleted along with Line 13 (Fields 02TBA and 02SDC) after Tax Year 2004.

  2. This field is transcribed from Page 1, Part 2, Line 14 (Tax Years 2002 through 2004) of the return. It is computed by subtracting Page 1, Part 2, Line 13 from Line 12 (Fields 02TBA and 0212).

  3. Every state imposes some sort of tax on assets transferred at death. This can take the form of an estate tax (the estate pays tax on assets) or an inheritance tax (the heirs pay tax on what they receive), or both. A credit is allowed on these taxes paid against the federal estate tax up to certain percentage limitations. This field does the math to subtract the credit from the estate tax.

Invalid Conditions
  1. Field 02BSD is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02GTT - Gross Tax Tentative

  1. This field is only used on returns dated prior to Tax Year 2002. Line 7a was deleted, along with former Lines 7b, 7c, and 8 (Fields 02NTT, 02TNT, and 02TTT, respectively) after Tax Year 2001.

  2. This field is transcribed from Page 1, Part 2, Line 7a of the (Tax Year 2001 and prior year) return. If Page 1, Part 2, Line 5 (Field 0205) exceeds $10,000,000, it shows the lesser of Page 1, Part 2, Line 5 (Field 0205) or the applicable phase out range (see below). This field is bypassed if Page 1, Line 5 (Field 0205) is $10,000,000 or less.

  3. Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

  4. Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

Invalid Conditions
  1. Field 02GTT is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02NTT - Net Tax Tentative

  1. This field is only used on returns dated prior to Tax Year 2002. Line 7b was deleted, along with former Lines 7a, 7c, and 8 (Fields 02GTT, 02TNT, and 02TTT, respectively) after Tax Year 2001.

  2. This field is transcribed from Page 1, Part 2, Line 7b of the (Tax Year 2001 and prior years) return. It is computed by subtracting $10,000,000 from Page 1, Part 2, Line 5 (Field 0205) or the applicable phase out range (see below). This field is bypassed if Page 1, Part 2, Line 5 (Field 0205) is $10,000,000 or less.

  3. Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

  4. Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

Invalid Conditions
  1. Field 02NTT is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02TNT - Total Net Tax Tentative

  1. This field is only used on returns dated prior to Tax Year 2002. Line 7c was deleted, along with former Lines 7a, 7b, and 8 (Fields 02GTT, 02NTT, and 02TTT, respectively) after Tax Year 2001.

  2. This field is transcribed from Page 1, Part 2, Line 7c of the return (for Tax Years 2001 and prior). The computer will math verify this field using 5% (.05) of the computer generated amount for Field 02NTT. This field is bypassed if Page 1, Part 2, Line 5 (Field 0205) is $10,000,000 or less.

  3. Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

  4. Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

Invalid Conditions
  1. Field 02TNT is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 02TTT - Total Transfer Taxes Tentative

  1. This field is only used on returns dated prior to Tax Year 2002. Line 8 was deleted, along with former Lines 7a, 7b, and 7c (Fields 02GTT, 02NTT, 02TNT, respectively) after Tax Year 2001.

  2. This field is transcribed from Page 1, Part 2, Line 8 of the return (Field 02TTT). It is the sum of Page 1, Part 2, Lines 6 and 7c (Fields 0206 and 02TNT). (This was previously Field 0208 and was transcribed from Line 8 (Tax Years 2001 and prior).)

  3. Prior to 2002, the benefits of the Unified Credit and taxes of less than the maximum tax were phased out for estates of more than $10,000,000. This was why we calculated Page 1, Part 2, Lines 7a, 7b, 7c and 8.

  4. Depending on the maximum tax and Unified Credit in effect for the year of death, the phase out range changes. The phase out range ends at $17,184,000 for January 1, 1998, and subsequent years (through 2001), and at $21,040,000 ending December 31, 1997, and prior.

Invalid Conditions
  1. Field 02TTT is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Section 03 Data Form 706, U.S. Estate Tax Return, General Information

  1. Section 03 field designators, line numbers, field lengths and titles are listed below. This section is transcribed in dollars only or dollars and cents, whichever is applicable.

  2. Field 03B/R, Page 1, Part 2, Line 20 can be positive or negative on Form 706, U.S. Estate Tax Return.

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

Error Record Format - Section 03 (Form 706),U.S. Estate Tax Return.

  1. The Error Record Format for Section 03 is listed as follows:

    Field
    Designator
    Maximum
    Characters
    Field Name Location
    03GTC 12 Gift Tax Credit Page 1, Part 2, Line 15 (Tax Years 2002 through 2004)
    0313 12 Foreign Tax Credit Page 1, Part 2, Line 13
    0314 12 Prior Transfer Credit Page 1, Part 2, Line 14
    0315 12 Total Credits Page 1, Part 2, line 15
    >>>> 12 Total Credit
    Computer Generated
     
    0316 12 Net Estate Tax Page 1, Part 2, Line 16
    >>>> 12 Net Estate Tax
    Computer Generated
     
    0317 12 GST Tax Page 1, Part 2, Line 17
    03SEC 12 Section 4980A Page 1, Part 2, Line 23 (Tax Years 1998 and prior)

    Note:

    Schedule S is no longer valid for January 1, 1998, and subsequent years. It is still valid for December 31, 1997, and prior.

    0318 12 Total Transfer Taxes Page 1, Part 2, Line 18
    >>>> 12 Total Transfer Taxes
    Computer Generated
     
    0319 12 Prior Payments Page 1, Part 2, Line 19
    03USB 12 U.S. Treasury Bonds ((Flower Bonds) - Last Flower Bond matured November 15, 1998 - none outstanding now) Page 1, Part 2, Line 23 (Tax Years 2002 through 2004)
    03PMT 12 Total payments Page 1, Part 2, Line 24 (Tax Years 2002 through 2004)
    >>>> 12 Total Payments
    Computer Generated
     
    03B/R 12 Balance Due/Overpayment Page 1, Part 2, Line 20
    >>>> 12 Balance Due/Overpayment
    Computer Generated
     
    03MCT 12 Manually Corrected Total Transfer Taxes Page 1, Part 2, Line 18 (represents Total Tax)

    Note:

    On tax years 2002 through 2004 was edited on the dotted portion of Line 21 and prior to 2002 was edited on the dotted portion of Line 23

Field 03GTC - Gift Tax Credit

  1. This field is only used for returns with dates of death prior to 2005. Line 15 (Field 03GTC) was deleted after Tax Year 2004.

  2. This field is transcribed from Page 1, Part 2, Line 15 (Tax Years 2002 through 2004) of the return. (This was previously Line 17 and Field 0317 for Tax Years 2001 and prior.)

  3. Generally, only taxable gifts given after December 31, 1976, are taken into account in computing the estate tax payable upon death. There is an exception, however. Gifts given prior to that date are included in the estate if the decedent retained an interest in the property given which does not cease at death.

    Example:

    In 1975, a taxpayer gives a child a small business, provided he/she gets half the profits. These profits must continue to be paid to the estate after the taxpayer's death. The value of the interest in the business must be included in the taxpayer's estate.

  4. Since the gift must be included in the estate and be subjected to the estate tax, a credit is given for any gift taxes paid to prevent double taxation.

Invalid Conditions
  1. Field 03GTC is invalid if it is not all numeric or exceeds $9,999,999,999,99.

Correction Procedures
  1. Check for coding and transcription errors and correct as needed.

Field 0313 - Foreign Death Tax Credit

  1. This field is transcribed from Page 1, Part 2, Line 13.

  2. Many foreign governments impose some sort of transfer tax on assets transferred after death. It can be an estate tax (tax paid by the estate), an inheritance tax (tax paid by heirs receiving the assets), or both. The United States taxes its citizens and resident aliens on their worldwide assets. The United States and many foreign countries also tax nonresident aliens on assets held within the taxing country. This can lead to double taxation. Since estate tax rates are often very high, double taxation can mean that assets are taxed by the two countries at a total rate of 100% or more. To prevent this from occurring to U.S. citizens and resident aliens, the United States gives a credit against U.S. estate taxes for foreign death taxes paid. (The credit is the lesser of U.S. Estate Tax paid or Foreign Tax paid on property subject to credit.)

Invalid Conditions
  1. Field 0313 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0314 - Prior Transfer Credit

  1. This field is transcribed from Page 1, Part 2, Line 14.

  2. If a taxpayer pays estate tax on a property given to an heir who dies from two years before to 10 years after the donors death (yes, you can leave property to someone already dead), a credit is available to the estate of the heir. It has been deemed unfair to subject the property to another estate tax when the property was held by the heir for such a short period of time.

Invalid Conditions
  1. Field 0314 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0315 - Total Credits

  1. This field is transcribed from Page 1, Part 2, Line 15. It is computed by adding Page 1, Part 2, Lines 13 and 14 (Fields 0313 and 0314).

  2. These credits are added to reach a total which will be subtracted from the estate tax.

Invalid Conditions
  1. Field 0315 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0316 - Net Estate Tax

  1. This field is transcribed from Page 1, Part 2, Line 16. It is computed by subtracting Page 1, Part 2, Line 15 from Line 12 (Fields 0315 and 0312).

  2. This line performs the math to allow certain credits to be subtracted from the estate tax.

Invalid Conditions
  1. Field 0316 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0317 - GST

  1. This field is transcribed from Page 1, Part 2, Line 17.

  2. Generation-Skipping tax is the third type of transfer tax. It imposes tax at the maximum estate tax rate on certain transfers meant to avoid estate tax.

Invalid Conditions
  1. Field 0317 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0318 - Total Transfer Taxes

  1. This field is transcribed from Page 1, Part 2, Line 18, with a year in the DOD of 1998 and later. It is computed by adding Page 1, Part 2, Lines 16 and 17 (Fields 0316 and 0317).

  2. This field adds up the additions to estate tax.

Invalid Conditions
  1. Field 0318 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 0319 - Prior Payments

  1. This field is transcribed from Page 1, Part 2, Line 19.

  2. This line may be filled in on amended returns or on a return with an extension with payment. It shows estate taxes previously paid.

Invalid Condition
  1. Field 0319 is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 03USB - U.S. Treasury Bonds

  1. This field is only used for returns with dates of death prior to 2005. Line 23 (Field 0323) was deleted after Tax Year 2004.

  2. This field is transcribed from Page 1, Part 2, Line 23 (Tax Years 2002 through 2004) of the return.

  3. U.S. Treasury Bonds can no longer be used to pay estate taxes.

  4. If an amount is entered on Line 23, research BMFOL to determine if the amount has been credited to the estate.

    1. If present on BMFOL, move the amount to Line 22 and Field 0322.

    2. If not present on BMFOL, delete Line 23 and Field 0323 and continue processing the return.

Invalid Conditions
  1. Field 03USB is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 03PMT - Total Payments

  1. This field is only used for returns with dates of death prior to 2005. Line 24 (Field 0324) was deleted after Tax Year 2004.

  2. This field is transcribed from Page 1, Part 2, Line 24 (Tax Years 2002 through 2004) of the return. It is computed by adding Page 1, Part 2, Lines 22 and 23 (Fields 0322 and 0323).

  3. This field adds payments made prior to filing the return.

Invalid Conditions
  1. Field 03PMT is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 03B/R - Balance Due/Overpayment

  1. This field is transcribed from Page 1, Part 2, Line 20. It is computed by subtracting Page 1, Part 2, Line 19 from Line 18 (Fields 0319 and 0318).

  2. This field indicates if the estate owes money or is due a refund.

Invalid Conditions
  1. Field 03B/R is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

  2. If Field 03B/R underprints, any penalty or interest included by the taxpayer should be subtracted from the amount on Line 20 and the difference entered in Field 03B/R.

  3. Check for presence of Form 4349, Computation of Estate Tax Due with Return and Annual Installment, or request for installment payments under Section 6166. If installments have been established, bring up the underprint in Field 03B/R.

Field 03MCT - Manually Corrected Tax

  1. This field is only used if the decedent died prior to January 1, 1977, or if CCC "Y" applies. In these instances, the tax must be manually calculated.

  2. This field is the manually computed amount of Total Transfer Taxes and will be entered only by Error Resolution. It is entered on the dotted portion of Page 1, Part 2, Line 18.

Invalid Conditions
  1. Field 03MCT is invalid if it is not all numeric or exceeds $9,999,999,999.99.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 03SEC - Section 4980A

  1. This field is transcribed from Page 1, Part 2, Line 23.

  2. Schedule S was deleted for 1998 and subsequent years. It is still valid for 1997 and prior years. This Line 23 will still display on the ERS display screen as 03SEC for Tax Years 1998 and prior.

  3. An additional tax is put on taxpayers with very large pensions, tax deferred annuities or Individual Retirement Accounts (IRAs) under certain conditions.

Invalid Conditions
  1. Field 03SEC is invalid if it is not all numerics or exceeds $9,999,999,999.99, OR the year in Field 01DOD is after 1997.

Correction Procedures
  1. Check for coding and transcription errors and correct as needed.

  2. GTSEC 01. If year in Field 01DOD is after 1997, delete Field 03SEC.

Section 04 Data Form 706, U.S. Estate Tax Return, Error Record Format

  1. The Error Record Format for Section 04 is listed as follows:

    Field
    Designator
    Maximum
    Characters
    Field Name Location
    04PNL 28 Primary Name Line Decedent Page 1, Part 1, Box 1a
    04CAD 20 County at Death Page 1, Part 1, Box 3a
    04SAD 2 State at Death Page 1, Part 1, Box 3a
    04ZAD 12 ZIP at Death Page 1, Part 1, Box 3a
    04EXE 35 Executor Page 1, Part 1, Box 6a
    04CON 35 "In-Care-of" Name Page 1, Part 1, Box 6a or 6b
    04FAD 35 Foreign Address Page 1, Part 1, Box 6b
    04ADD 35 Street Address Page 1, Part 1, Box 6b
    04CTY 22 City/Major City Code Page 1, Part 1, Box 6b
    04ST 2 State Code Page 1, Part 1, Box 6b
    04ZIP 12 ZIP Code Page 1, Part 1, Box 6b
    04MXI 1 Multiple Executors Indicator Page 1, Part 1, Line 6d
    04AEI 1 Asset Value Estimate Indicator Page 1, Part 1, Line 11
  2. Section 04 cannot be present on a "G" coded return. If present, DLSEC 04.

Field 04PNL - Primary Name Line Decedent

  1. This field is transcribed from Page 1, Part 1, Box 1a and 1b. The Primary Name Line must be present unless CCC "G" is present.

  2. Although the total field is 35 characters, the number of characters that can be input is limited to 28 because the word "ESTATE" is generated when going to the Master File.

  3. This field indicates the name of the decedent for whom the estate tax return is being filed.

Invalid Conditions
  1. Field 04PNL is invalid if:

    1. It is blank.

    2. Field contains characters other than alpha, lozenges (<), hyphens (-), and blanks.

    3. A character follows 2 consecutive blanks.

    4. The first position contains a blank.

    5. No lozenge is present.

    6. One lozenge is present and is followed by a blank.

    7. For taxpayers with only one name, a hyphen present in the first position followed by a lozenge is not found.

    8. The field contains more than two lozenges.

    9. Lozenges cannot appear in consecutive positions.

    10. The first or last position of the field contains a lozenge.

    11. The number of character positions is more than 28.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed. If name is not present or cannot be resolved, SSPND with AC 320.

Field 04CAD - County at Death

  1. This field is transcribed from Page 1, Part 1, Box 3a of the return. The field must contain an entry.

Invalid Conditions
  1. Field 04CAD is invalid if:

    1. It is blank.

    2. Field contains characters other than alpha characters and blanks.

    3. An alpha follows two consecutive blanks.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

  2. For Alaska, use the applicable borough. For Louisiana, use the applicable parish.

  3. The following table contains instructions for Field 04CAD:

    If Then
    A U.S. citizen dies while abroad, but whose domicile remained in the U.S. The Form 706, U.S. Estate Tax Return, must be filed with the Cincinnati Submission Processing Campus.
    The information is not found on Page 1, Part 1, Box 3a
    1. Research death certificate.

    2. Use ZIP code directory to determine the county in which the taxpayer was domiciled at the time of death.

    Note:

    If the entry in Box 3a is a foreign country, enter the foreign country name in Field 04CAD.

    Not found Enter "Unknown" in Field 04CAD.

Field 04SAD - State at Death

  1. This field is transcribed from Page 1, Part 1, Box 3a. This field must have an entry containing a valid two character state code.

Invalid Conditions
  1. Field 04SAD is invalid if:

    1. It does not contain a valid state code or other country ("OC" ).

    2. It is blank.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed Using If/Then Charts below:

    If Then
    1. A nonresident U.S. citizen and whose domicile is not in the U.S.

    2. A U.S. citizen dies while abroad, but the domicile remained in the U.S.

    All Forms 706 are filed at the Cincinnati Submission Processing Campus.
    The information is not found on Page 1, Part 1, Box 3a Research death certificate.
  2. Use Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for valid state codes.

    If Then
    You cannot find the state of death Research, using INOLE. Input the state in Field 04SAD. If not found, enter "OC" in Field 04SAD.
    The ZIP code is present but the state is not Use the ZIP code directory to determine the state and input in Field 04SAD. Research INOLE. If not found, enter "OC" in Field 04SAD.
    The information cannot be found through research or in ZIP code directory Enter "OC" in Field 04SAD.

Field 04ZAD - ZIP at Death

  1. This field is transcribed from Page 1, Part 1, Box 3a.

Invalid Conditions
  1. Field 04ZAD is invalid if:

    1. The first five positions are not numeric.

    2. Positions four and five are "00" .

      Exception:

      ZIP code 20500.

    3. The last three or seven positions are not all numeric or all blank.

    4. The first three positions are not valid for the state code in Field 04SAD.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed, using If/Then Chart below:.

    If Then
    The information is not found on Page 1, Part 1, Box 3a Research death certificate.
    A valid ZIP code is not available from the return or attachments to the return Refer to Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for a valid ZIP code.
    Only the first three digits of the ZIP code can be found Enter 01 for the fourth and fifth digits.

Field 04EXE - Executor

  1. This field is transcribed from Page 1, Part 1, Line 6a of the return. This field must be present except when "G" coded.

  2. This field identifies the person responsible for the estate.

Invalid Conditions
  1. Field 04EXE is invalid if:

    1. The field contains other than alpha characters, numeric characters, hyphens, ampersands or blanks.

    2. The first position contains any character other than alpha or numeric.

    3. A character is followed by two consecutive blanks.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

  2. Refer to the return or attachments to find the correct name. Using the following Information:

    If Then
    No executor is indicated Enter the name of a personal representative or attorney, which can be found on Page 1, Part 1, Box 6a; Page 2, Part 4; the signature area; or in attachments.
    The return and attachments have no evidence of an executor, personal representative or attorney Enter "Unknown" in Field 04EXE.

♦Field 04CON - "In-Care-of" Name♦

  1. This field is transcribed from Page 1, Part I, Line 6a.

  2. Field 04CON has 35 positions and the valid characters are alpha, numeric, ampersand, dash, slash or percent (%).

    Note:

    The first character of the "in-care-of" name must be alpha or numeric.

Invalid Conditions
  1. Field 04CON is invalid if:

    1. The first position is % (percent) and the second position is not blank.

    2. The first position is blank.

    3. The first character of the "in-care-of" name is not alpha or numeric.

    4. There are two consecutive blanks between significant characters.

Correction Procedures
  1. Check for coding and transcription errors and correct as needed, Using the following If/Then Chart:

    If Then
    A % (percent) is in the first position
    1. Verify there is a blank in the second position.

    2. If not blank, enter a blank followed by the "in-care-of" name beginning with an alpha or numeric in Field 04CON.

    A blank is in the first position
    1. Delete blank.

    2. Enter the in-care-of name beginning with % (percent sign), followed by a blank, followed by an alpha or numeric in Field 04CON.

    The first character of the in-care-of name is not alpha or numeric
    1. Verify in-care-of name on the return.

    2. Enter the in-care-of name beginning with an alpha or numeric in Field 04CON.

    Two consecutive blanks are present between significant characters Delete any unnecessary blanks in Field 04CON.

♦Field 04FAD - Foreign Address♦

  1. This field is transcribed from Page 1, Part 1, Box 6b.

    1. This field will contain an entry when there is a foreign address present on the return.

    2. Field 04FAD should not be present on "G" coded returns.

  2. Valid characters are alpha, numeric and special characters.

Invalid Conditions
  1. Field 04FAD is invalid if:

    1. The first position is blank.

    2. Any character follows two consecutive blanks.

    3. There are more than 35 characters present in the field.

      Note:

      Integrated Submission and Remittance Processing (ISRP) is instructed to input a pound sign (#) as the 35th character if there are more than 35 characters present for this field on the return.

Correction Procedures
  1. Check for coding and transcription errors and correct as needed, with the following action.

    If Then
    Field 04FAD is present
    1. GTSEC 04.

    2. Ensure Field 04CTY contains a foreign country code and Field 04ST contains a "." (period/space).

    A foreign address is not present on the return
    1. SSPND 610.

    2. Renumber return to domestic.

  2. If Form 8822, Change of Address, is attached to the return, compare the name and address information on the Form 8822, Change of Address, to the return, following If/Then Chart.

    If Then
    The information is the same Take no action and continue processing.
    The information is different
    1. Detach Form 8822, Change of Address.

    2. Route to Entity Control on Form 10886, Reject Routing Slip, and notate "Change of Address per Form 8822" .

    Note:

    The lead tax examiner is required to batch all Form 8822s daily and hand carry to Entity Control for expedited processing.

♦Foreign Addresses - General Information♦
  1. CSPC will process Estate and Gift tax foreign/international addresses and U.S. Possessions returns.

    1. A foreign (international) address is any address that is not in one of the 50 states or the District of Columbia.

    2. All U.S. Possessions are considered foreign:

    • American Samoa

    • Federated States of Micronesia

    • Guam

    • Marshall Islands

    • Northern Mariana Islands

    • Palau

    • Puerto Rico

    • Virgin Islands

  2. The U.S. Postal Service established new address requirements for Army Post Office (APO), Diplomatic Post Office (DPO), and Fleet Post Office (FPO) addresses. If an address appears in the old format, such as APO New York, NY 091XX, convert to the new state code abbreviation (APO AE 091XX) based on the ZIP Code. APO/DPO/FPO addresses are considered domestic addresses. Refer to conversion table below:

    ZIP Code Address Abbreviation
    340XX APO/DPO/FPO AA
    090XX-098XX APO/DPO/FPO AE
    962XX-966XX APO/DPO/FPO AP
♦Foreign Addresses♦
  1. A foreign address will contain:

    • Street Address or PO Box

    • City or town name

    • Other principal subdivision (i.e. province, state, county, etc.)

    • Postal code, if present

    • Foreign country

  2. Returns with addresses in the U.S. Possessions are considered to be a foreign return for processing purposes and are entered in the same way as domestic addresses. Refer to chart below for Abbreviations.

    Note:

    A two character alpha code must be entered in Field 04ST for the possession name.

    U.S. Possession Abbreviation
    American Samoa AS
    Federated States of Micronesia FM
    Guam GU
    Marshall Islands MH
    Northern Mariana Islands MP
    Palau PW
    Puerto Rico PR
    Virgin Islands (U.S.) VI
  3. A ZIP code must be present.

♦Foreign Address - Canada Only♦
  1. In an effort to assist Compliance with workload assignment, returns filed with an address in Canada will be edited using a unique country code based on the province. Using the following If/Then charts.

    If Then
    The foreign address contains a Canadian province name or abbreviation
    1. See table below to ensure the correct Canadian province abbreviation is present or edited to the return.

    2. Edit the appropriate country code based on the province preceded by a "/" and followed by a "/$" as the last entry in the address.

    The foreign address does not contain a Canadian province name or abbreviation
    1. Circle the country name.

    2. Edit the country code "/CA/$" as the last entry in the address.

    Canadian Province Province Abbreviation Country Code
    Alberta AB XA
    British Columbia BC XB
    Manitoba MB XM
    New Brunswick NB XN
    Newfoundland and Labrador NL XL
    Northwest Territories NT XT
    Nova Scotia NS XS
    Nunavut NU XV
    Ontario ON XO
    Prince Edward Island PE XP
    Quebec QC XQ
    Saskatchewan SK XW
    Yukon YT XY

Field 04ADD Street Address

  1. This field is transcribed from Page 1, Part 1, Box 6b of the return.

Invalid Conditions
  1. Field 04ADD is invalid if:

    1. Any character other than alpha, numeric, blank, dash, or slash is present.

    2. Any character follows two consecutive blanks.

    3. The first position is not an alpha or numeric character.

    4. There are more than 35 characters in this field (ISRP will input a pound (#) sign as the 35th character).

Correction Procedures
  1. Check for coding and transcription errors and correct as needed.

  2. If the 35th character is a pound sign (#), find a way to abbreviate the address to 35 or fewer characters. Refer to Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for address abbreviations.

  3. If unable to correct, SSPND with AC 320.

Field 04CTY - City/Major City Code

  1. This field is transcribed from Page 1, Part 1, Box 6b of the return.

Invalid Conditions
  1. Field 04CTY is invalid if:

    1. Any character other than alpha or blank is present.

    2. Any character follows two consecutive blanks.

    3. The first position is blank.

    4. Foreign country code is not present, incorrect or contains "XX" .

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

  2. Refer to Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for the valid Major City Codes and ZIP codes.

  3. If a foreign address is shown on the return, enter appropriate foreign country code in Field 04CTY. See Exhibit 3.12.263-12, Foreign Country Codes.

  4. If unable to correct, blank the field.

Field 04ST - State Code

  1. This field is transcribed from Page 1, Part 1, Box 6b of the return.

Invalid Conditions
  1. Field 04ST is invalid if:

    1. Any character other than alpha and blank, if present.

    2. The first position is blank.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

  2. Refer to Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for the valid state abbreviations and ZIP codes. See Exhibit 3.12.263-11for ZIP codes for U.S. Possessions.

  3. If unable to correct, GTSEC 04 and delete specific fields.

Field 04ZIP - ZIP Code

  1. This field is transcribed from Page 1, Part 1, Box 6b.

Invalid Conditions
  1. Field 04ZIP is invalid if:

    1. The first five positions are not numeric

    2. Positions four and five are "00" .

      Exception:

      ZIP code 20500.

    3. The last three or seven positions are not all numeric or all blank.

    4. Field 04ST is foreign (i.e., a period and a space (. ) is present) and the File Location Code in the DLN is not 98.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed. Following the If/Then Chart below:

    If Then
    A valid ZIP code is not available from the return or attachments to the return. Refer to Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for a valid ZIP code. See Exhibit 3.12.263-11, U.S. Possessions ZIP Codes.
    Only the first three digits of the ZIP code can be found. Enter 01 for the fourth and fifth digits.

Field 04MXI - Multiple Executors Indicator

  1. This field is transcribed from Page 1, Part 1, Line 6d and is valid for DOD in 2012 and subsequent.

Invalid Conditions
  1. Field 04MXI is invalid if:

    1. Any character other than blank or 1.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Field 04AEI - Asset Value Estimate Indicator

  1. This field is transcribed from Page 1, Part 1, Line 11 and is valid for DOD in 2012 and subsequent.

Invalid Conditions
  1. Field 04AEI is invalid if:

    1. Any character other than blank or 1.

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Section 05 Data Form 706, U.S. Estate Tax Return, Error Record Format

  1. The Error Record Format for Section 05 is listed as follows:

    Field
    Designator
    Maximum
    Characters
    Field Name Location
    05AMS 1 Marital Status (need to input 1, 2, 3, 4 or 5 depending on the martial status. Page 2, Part 4, Line 3a

Field 05AMS - Marital Status

  1. This field is transcribed from Page 2, Part 4, Line 3a and is valid for DOD in 2012 and subsequent.

Invalid Conditions
  1. Field 04AEI is invalid if:

    1. Any character other than 1 (Married), 2 (Widow/Widower), 3 (Single), 4 (Legally Separated), or 5 (Divorced).

Correction Procedure
  1. Check for coding and transcription errors and correct as needed.

Section 06 Data Form 706, U.S. Estate Tax Return, Error Record Format

  1. The Error Record Format for Section 06 is listed as follows:

    Field
    Designator
    Maximum
    Characters
    Field Name Location
    0606 1 Protective Claim for Refund Indicator Page 2, Part 4, Line 6
    0610A 15 Gross Estate Estimated Value of Assets (Alternate value) Page 3, Part 5, Line 10, column 1 (Alternate value)
    0610B 15