3.13.12 Exempt Organization Account Numbers

Manual Transmittal

December 7, 2016

Purpose

(1) This transmits revised IRM 3.13.12, SC Document Services, Exempt Organization Account Numbers.

Material Changes

(1) Grammatical changes made throughout the IRM.

(2) IRM 3.13.12.6.12.2 (p) (q) - Location address procedures added.

(3) IRM 3.13.12.9.11.1 - Change throughout tri-doc due to e-Postcard system change.

(4) IRM 3.13.12.22.8.19 (17) Undeliverable reference added.

(5) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.2 (c) - Sentence clarified.

(6) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.6.28.7(5) - IRM reference added.

(7) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.7.1(2) - Requirement for source document removed.

(8) Incorporated IPU 16U0818 issued 04-28-2016 IRM 3.13.12.7.1(6) - Added information to remove consolidated EINs from EO Select Check.

(9) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.11.1 - IRM reference added.

(10) Incorporated IPU 16U0818 issued 04-28-2016 IRM 3.13.12.11.4(5) - If/Then- Removed requirement to send to M/S 1110. Procedures to resolve added.

(11) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.12.5(2)(c) - IRM reference added.

(12) Incorporated IPU 16U1000 issued 05-31-2016 IRM 3.13.12.14.8 - Routing instructions for CP 249C notices removed.

(13) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.22.8.5(7)(c) - Sentence reworded for clarification.

(14) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.22.8.9(1) - IRM reference added.

(15) Incorporated IPU 16U0257 issued 02-04-2016 IRM 3.13.12.22.8.19 (17)(e) - Added 259 G and H reference.

Effect on Other Documents

This supersedes IRM 3.13.12, dated 01-01-2016.

Audience

This IRM is intended for use by the Ogden Campus Exempt Organization Entity personnel.

Effective Date

(01-01-2017)

Sean E. O’Reilly,
Acting Director, Business Systems Planning
Government Entity and Shared Services
Tax Exempt and Government Entities

Overview

  1. This IRM provides procedures for:

    • Establishing entities on the BMF

    • Maintaining entities on the BMF

    • Updating entities on the BMF

    • Processing Form 1128, Application to Adopt, Change or Retain a Tax Year

    • Processing Form 8274, Certification by Churches and Qualified Church-Controlled Organizations Electing Exemption from Employer Social Security Taxes

    • Processing Form SS –16, Certificate of Election of Coverage Under the Federal Insurance Contribution Act

    • Processing taxpayer correspondence relating to entity

    • Processing requests for Federal Tax Deposit Coupons

    • Consolidating multiple EINs

    • Maintaining exempt organizations

    • Processing exempt organization delinquent notices

    • Processing supplemental group ruling information (SGRI)

    • Assigning group exemption numbers (GEN)

    • Processing returns without an employer identification number or a change of organization

  2. The following IRMs are used in conjunction with IRM 3.13.12:

    • IRM 3.12.278, Exempt Organization Unpostable Resolution

    • IRM 3.12.32, General Unpostables

    • IRM 3.12.279, BMF/IRAF/CAWR/Unpostables Resolution

    • IRM 3.13.2, BMF Account Numbers

    • IRM 3.11.12, Exempt Organization Returns

    • IRM 3.12.12, Exempt Organization Returns

    • IRM 3.10.72, Extracting, Sorting and Numbering

    • IRM 3.13.62, Media Transport and Control

    • IRM 3.30.123, Processing Timeliness

    • IRM 3.8.46, Discovered Remittance

    • IRM 3.17.220, Excess Collection File

    • IRM 3.5.61, Files Management and Services

    • IRM 21.2.3, Transcripts

    • IRM 2.4, IDRS Terminal Input

    • IRM 2.4.10, CC EOREQ and EOCHG

    • IRM 2.4.9, CC ENREQ and BNCHG

    • IRM 2.3, IDRS Terminal Responses

    • IRM 21.7.13, Assigning Employer Identification Numbers

  3. This IRM includes information and instructions to work EO entity cases and can't cover all situations, so judgment is needed to work the case. Contact your Manager or Lead tax examiner to determine if your decision is valid. You should request an IRM change to add instructions if you encounter repeated problems or issues which are not currently in the IRM.

  4. The instructions for processing Form SS-4, Application for Employer Identification Number, and using the CC ESIGN are located in IRM 21.7.13, Assigning Employer Identification Numbers. You should refer to this IRM when processing Form SS-4 or using CC ESIGN to assign an Employer Identification Number (EIN) for a return. The following table should be used when assigning an EIN to determine the Business Operational Date (BOD):

    If Then
    The entity is a trust The date the trust was funded
    The entity is an estate
    • The date of death of the decedent, or

    • The date the estate was legally funded (that is, when probate completed and assets flowed into the account).

    • A BOD isn't indicated, and

    • The entity has employees and has indicated a wages paid date (line 15 of the Form SS-4)

    The Wages Paid Date EXCEPTION: If the Wages Paid Date is later than the current date, use the current date as the BOD.
    • A BOD isn't indicated

    • The entity doesn't have employees, and/or

    • A wages paid date isn't indicated

    The current date.
    • A BOD isn't indicated, and

    • The taxpayer is required to file Form 1042, Form 730, or Form 2290

    The current date

IRM Format

  1. The format of this IRM was changed:

    • Indented bullets (•) are used when the order of items isn't important.

    • Indented numerical listings are steps usually done in the order listed.

    • Indented alphabetical listings are procedures done in no particular order.

Glossary of Terms

  1. Account: One taxpayer identified by a Social Security number or employer identification number. Each account is a record of the type of returns filed and the related tax periods.

  2. Accounts Maintenance Transcripts: A transcript generated when an unresolved credit is on the Master File.

  3. Amended Return: A second return filed which changes the information submitted on the original return.

  4. Automated Collection System: (ACS) An automatic calling system for tax periods within an account which is in taxpayer delinquent investigation or taxpayer delinquent account status.

  5. Asset Code: Used to identify end of year total assets.

  6. Automatic Data Processing – (ADP): The handling and processing of data from its electronic machines with a minimum of human intervention.

  7. Batch: A group of work of like documents within a program code.

  8. Blocking Series: A special identification within a Document Locator Number (DLN) which requires or identifies special action.

  9. Business Master File - (BMF): A magnetic tape file containing information about organization filing business returns and related documents.

  10. Business Operating Division (BOD): Effective 01/01/2000, all IMF, BMF, and EPMF taxpayers will be systemically assigned to a BOD code based on the characteristics of the tax return. IMF taxpayers will either be assigned to the SB (Small Business/Self-Employed) BOD or to the WI (Wage and Investment) BOD. BMF taxpayers will be assigned to the LB & I (Large Business & International) BOD, to the TE (Tax Exempt) BOD or to the SB BOD.

  11. Calendar Year: The 12 month period from January 1 through December 31.

  12. Command Code - (CC): Five-character code used to input data on the Integrated Data Retrieval System (IDRS).

  13. Computer Paragraph - (CP): Computer generated notices to request information or give information to the organization regarding certain aspects of their tax return. Also, certain notices are generated to inform the campuses of posting to the Master File which require additional action.

  14. Consolidate: The moving of data when one organization has erroneously been given more than one Taxpayer Identification Number (TIN).

  15. Credit Balance: A term noting a credit outstanding on a module. Identified by a minus (−) after the amount.

  16. Cross Reference – (X-Ref):Identifies related Taxpayer Identification Numbers (TINs) and sort names (DBA).

  17. Cycle: One week's processing at the campuses and Martinsburg Computing Center. The cycle is expressed by a 6 digit code. The first four digits represent the processing year and the last two digits represent the processing week in the year.

  18. Document Locator Number - (DLN): A controlled fourteen digit number assigned to every return or document input through the Automatic Data Processing (ADP) system. The last digit is the year of processing and is assigned by the Campus Computer Program at the time of the original input. The DLN is used to control, identify, and locate documents processing in the ADP system.

  19. Dummy Return:An input return not prepared by the organization or an input document treated as a return.

  20. Employer Identification Number - (EIN):An assigned nine (9) digit number which identifies a business tax account.

  21. Employment Code - (EC): A one-letter code used to identify certain employers regarding Social Security Taxes and Federal Unemployment Tax.

  22. Entity: The portion of the Master File record which identifies the organization. The entity contains:

    • name

    • address

    • social security (SSN) or employer identification number (EIN)

    • employment code (EC), if applicable

    • name control (NC), four characters from the organization name

    • location codes

    • filing requirement codes (FRC)

    • fiscal period

    • date of establishment

  23. Excess Collections: An account of unapplied credits transferred from an unidentified or Master File Account.

  24. Exempt Organization - (EO): Those organizations exempt from federal income tax under IRC 501(a) of 1986. IRC 501(c)(3), IRC 501(c)(9) IRC 501(c)(17), IRC 501(c)(20 and IRC 501(c)(29)) organizations are required to notify the Service they are seeking tax-exempt status; they must file a Form 1023 or Form 1024 as applicable. IRC 501(c) organizations other than IRC 501(c)(3), IRC 501(c)(9) IRC 501(c)(17), and IRC 501(c)(20) are not required to file an application for exemption, though they may do so. They are considered exempt even though they don’t apply for exemption. Organizations which are recognized as tax-exempt and their actual activities are not what they described in their application or are not appropriate for their subsection code, can have their tax-exempt status revoked retroactively.

  25. File Source: A one-digit code which follows the Taxpayer Identification Number (TIN). The common values are:

    • Blank - valid SSN or EIN

    • * - invalid SSN on IMF

    • V - valid SSN on BMF

    • W - invalid SSN on BMF

    • D - temporary TIN

    • P - valid IRA SSN

    • X - invalid IRA SSN

    • P - valid EPMF EIN

    • X - invalid EPMF EIN

  26. Filing Requirement Code - (FRC): Identifies the type of return an organization must file.

  27. Fiscal Year Month - (FYM): Any month an organization elects to be the ending month of an accounting year.

  28. Group Exemption Number - (GEN): A four-digit number issued to a parent and its subordinate chapters under a blanket group ruling.

  29. Group Exemption Roster - (GER): Document 6023 - GER is an alphabetic and number listing of organizations which were issued Group Exemption Numbers. Command Code (CC) EOGEN allows online research of the GER using the GEN number of the group.

  30. Group Return: Form 990 marked "Group Return" or "Consolidated" is a return filed by the Parent Organization for all subordinates electing to be covered under the group return. This return is in addition to the Parent's own return.

  31. Income Code:Used to identify yearly receipts for Exempt Organization (EO) Business Master File (BMF) returns.

  32. Integrated Data Retrieval System – (IDRS):A computer system with the capability to instantaneously retrieve or update stored information. IDRS works with the Master File or organization accounts. The purpose of the system is quick resolution of problems and inquires concerning current and prior taxpayer accounts.

  33. Martinsburg Computing Center – (MCC): The Martinsburg Computing Center is located in Martinsburg, WV, where business and individual transactions are posted to the various Master Files (MFs).

  34. Master File – (MF): A magnetic tape record containing information about business and individual returns and related documents. The Business Master File (BMF) contains records on each entity, divided into two sections, entity section and returns section.

  35. Master File Tax Account Code - (MFT): A two-digit number which identifies the type of tax form.

  36. Merger: A combination of two or more corporations. One is the successor corporation and the other corporation finals out their return. Don’t confuse merger with consolidate (TC 011).

  37. Microfilm: A media to provide photographic records of printed tax data on a reduced scale.

  38. Name Control - (NC): In the case of individuals and most trusts, NC is the first four letters of the taxpayer's last name; in the case of corporations, the first four letters of the business name. The name control is used to check the Master File and ensure the Taxpayer Identification Number (TIN) corresponds with the proper organization.

  39. National Account Profile - (NAP): A national Taxpayer Identification Number (TIN) file of entities on the Individual Master File (IMF), Business Master File (BMF), Employee Plans Master File (EPMF) and IRAF. It is used to validate the Taxpayer Identification Number (TIN) or TIN/Name Control for the Integrated Data Retrieval System (IDRS) input command codes (CCs) and for researching with CC INOLE.

  40. Parent: The governing body of a controlled group of corporations or an exempt organization with a group ruling.

  41. Pilot Voucher: An Exempt Organization and Business Master File (BMF) Entity Voucher prepared for processing group exemptions. This information can be accessed via the shared drive only.

  42. Pilot Voucher File – (PVF): A file of all pilot vouchers kept in Group Exemption Number (GEN) order. The pilot vouchers are used in establishing new subordinates of a group ruling.

  43. Prior Year: A tax period which precedes the processing year.

  44. Re-input: Reprocessing the return.

  45. Refile: Sending the return or document back to files to be filed in its original position in the block.

  46. Reject: A return or document which was not acceptable by the campus computer because of incorrect or incomplete information.

  47. Return: A legal form or written evidence used by the organization to record tax information.

  48. Revocation:

    • Tax exempt organizations who fail to file for three consecutive years will be revoked.

    • Tax exempt organizations may also be revoked due to a review by an agent.

    • A Church-initiated correspondence to revoke the election to be exempt from social security taxes.

  49. Subordinate: Members of a group of exempt organizations controlled by a parent organization.

  50. Subsection Code – (SS): A code designating the type of exemption an organization has received.

  51. Supplemental Group Ruling Information - (SGRI): A letter submitted to IRS each year by the Parent Organization of a Group Ruling detailing any changes to its subordinates.

  52. Tax Module: The part of an organization's account which reflects tax data for each type of tax and tax period.

  53. Tax Period: The period of time for which a return is filed. The Service uses a six digit code to indicate the end of the tax period for a given return. The first four digits represent the year and the last two digits represent the month.

  54. Taxpayer Delinquent Account - (TDA):A tax module where a return was filed, but not fully paid, and is in collection status.

  55. Taxpayer Delinquent Investigation - (TDI): A tax account which has a filing requirement for which a return has not been received and is in collection status.

  56. Taxpayer Identification Number - (TIN): Either an Employer Identification Number (EIN) or a Social Security Number (SSN).

  57. Transaction Code - (TC): Used to identify transactions being processed and to maintain a history of actions posted to taxpayer accounts on the Master File. A three digit code used to identify actions being taken to an organization account.

  58. Transcript: A copy of entity and tax data from the Master File concerning an organization's account.

  59. Unpostable - UP: An input transaction which attempted to post to the Master File but could not because of inconsistencies with the posted transactions, filing requirements, or the input data.

  60. Unprocessable: A document which is incomplete, illegible, or otherwise unsatisfactory for input.

CADE2

  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.

    Note:

    The CADE Master File, as it existed from 2004 – 2011, will transition from Production and be retired at the end of 201152.

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

  3. With CADE 2 there will be changes to campus cycles which will begin with cycle 201201. The new BMF, EO and EPMF campus cycles are:

    1. Campus Cycle: Thursday – Wednesday

    2. Master File Processing: Friday – Thursday

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

    4. Unpostables: New available Tuesday; Closing Tuesday

  4. BMF, EO and EPMF transaction posting time frames are outlined as follows:

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

    • 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. Cycle 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, EO and EPMF 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.

Transaction Codes

  1. The following is a list of transaction codes (TCs) used by the Entity Control Function.

    TC Description
    000 Establish an account
    001 Re-sequence an account due to a TIN change (generated transaction)
    002 TIN change failed to resequence (generated transaction)
    003 Duplicate tax modules are not re-sequenced (general transaction)
    004 BMF Partial Merge. This transaction code is shown on IDRS only.
    005 Resequenced account for merge.
    006 Account Resequenced to Master File location
    007 Carrier transaction (generated transaction)
    008 IDRS generated—Complete Merge
    011 EIN change
    012 Reopen entity account
    013 Name change
    014 Address change
    016 Change entity codes
    020 Closes account
    022 Deletes EO section
    023 Reverse the election to lobby
    024 Election to lobby
    026 Delete changed TIN (generated transaction)
    030 Update location codes out-of-campus account
    052 Reversal of TC 053
    053 Form 1128 Accepted
    059 Form 1128 Rejected
    070 Church exemption from social security taxes
    071 Revocation of church exemption from social security taxes
    072 Deletion to TC 070 input in error
    073 Reverses TC 071 input in error by the service
    080 Denies election of exemption from FICA
    081 Reverses TC 080
    150 Return Filed
    474 Delay TDI or Accelerate TDI Issuance
    475 Reverses TC 474 and allows TDI Issuance
    590 Not liable this period
    591 No longer liable
    592 Reverses 59X
    593 Unable to locate
    594 Return previously filed
    599 Return secured

IDRS Letters and CP Notices

  1. The following is a list of letters which can be used:

    Letter Use Title
    45C SS – 4 EIN Application Requested or Received (Form SS–4)
    86C General Referring Taxpayer Inquiry or Forms to Another Office
    104C Correspondence Address Change Acknowledged
    112C Payment or overpayment Credit Applied; No Record of Return Filed
    131C General Information Insufficient or Incomplete for Processing Inquiry
    135C General Power of Attorney Needed to Furnish Information
    139C General EIN Assigned in Error
    145C Delinquent returns Insufficient Response or No Record
    252C General Name of Business Shown on Return Needs Verification
    282C TDIs Return Not Received, Copy Requested or Received
    309C General Forms, Publications, or Schedules to Taxpayer
    696C General Return Requested for Discontinued Business
    1169C EO Correspondence Exempt Organization Group Ruling
    1224C EO Correspondence Exempt Organization’s Answers to Questions
    1921C Form 8274 Employment Code C, Form 941
    2191C Form SS-16 Certificate of Election Coverage
    2233C EO Correspondence Accounting Period Change Denied
    2314C Form 1128 Application to Adopt, Change or Retain a Tax Year
    2694C EO Correspondence Request for Missing Information
    2695C EO Correspondence Request for Missing Information
    2696C EO Correspondence Miscellaneous Forms Request for Missing Information
    2697C EO Correspondence Form 990-PF Request for Missing Information
    2698C EO Correspondence Form 990 Request for Missing Information
    2699C EO Correspondence Form 990-EZ Request for Missing Information
    3064C General Special Letter
    3710C 527 Pol. Org. Request for Completed Form 8871
    3877C EO Correspondence No Application for Tax-Exempt Status
    3905C Form 5768 Form 5768
    3909C EO Correspondence Application for Tax-Exempt Status Not Approved
    3997C EO Correspondence Form 940 Filing Requirements for Exempt Organizations
    3910C Correspondence/Returns Information Regarding Assignment of EIN for Exempt Organizations
    4588C EO Miscellaneous Request for miscellaneous information.

    Note:

    Use the hard-coded paragraph (If you have any questions, please call us toll free at 877-829-5500) in lieu of the "fill-in" paragraph in all letters listed above, except 135C and 139C.

    Note:

    If correspondence was issued within the last 60 days for the same issue, don’t issue another letter.

    Note:

    Specific letters are mentioned throughout the IRM; however, it is appropriate to use any letter as long as the content addresses the issue.

  2. The following is a list of CP notices which are sent to the taxpayer:

    CP Title
    119 SGRI Notice (replaced the 1582O letter)
    120 Confirmation of Tax Exempt Status Required
    120A Notice of Revocation of Tax Exempt Status (Status 97)
    169 Missing Return
    209 EIN Assigned in Error
    249A Form 8871 Not Filed
    249B Form 8872 Filed Late
    249C Form 8872 Not Filed
    259A Request for Information About Your Form 990 Return
    259B Request for Information About Your Form 990-PF Return
    259C Request for Information About Your Form 990-PF Return (Presumptive Form 990-PF)
    259D Request for Information About Your Form 990-T Notice
    259E Request for Information About Your Form 990–N
    259F Request for Information About Your Form 5227
    259G Request for Information About Your Form 1120-POL -
    259H Request for Information About Your Form 990 - Section 527 Organization
    575 Notice of New Employer Identification Number Assigned from Form SS-4 or TeleFax
    576 Notice of New Employer Identification Number Assigned from Return or SGRI
    577 Notice of New Employer Identification Number Assigned from a Change in Organization Requiring a New EIN
  3. The following list of CP notices are for internal use:

    CP Title
    172 Follow-up Action on an Entity Established as an Exempt Organization
    192 Employment Code Exempts FICA/FUTA Filing
    200 TIN Change - Inactive Account
    201 TIN Change - Name Control Mismatch
    202 EI Number Change - Filing Requirement Mismatch

National Service Level Agreements (SLAs)

  1. National Service Level Agreements (SLAs) were established between Operating Divisions. IRM 3.13.12 contains specifics regarding SLAs which pertain to activities performed by use of this IRM. For additional information, refer to the Taxpayer Bill of Rights available at http://taxpayeradvocate.irs.gov/About-TAS/Taxpayer-Rights.

Taxpayer Advocate Service (TAS)
  1. The Taxpayer Advocate Service is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems which have not been resolved through normal channels, or who believe an IRS system or procedure isn't working as it should. TAS criteria include economic burden, systemic burden, best interest of the taxpayer and public policy (as determined solely by the National Taxpayer Advocate (NTA)). TAS is responsible for assisting taxpayers who have unresolved problems within the IRS. See IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria , if additional information is needed.

  2. IRS employees will advise taxpayers of the option to seek TAS assistance when appropriate. TAS will request documentation from the taxpayer if it is needed to support the requested relief or required by the IRM.

  3. A referral to a TAS office isn't necessary even if TAS case criteria is met if the IRS employee can resolve a taxpayer's inquiry or provide the relief requested, as outlined in IRM 13.1.7.4, Same Day Resolution.

    Note:

    It is important all IRS employees handle potential TAS cases with the taxpayer's best interest in mind. The definition of "same day resolution" is within 24 hours. However, although you cannot completely resolve the issue within 24 hours, if you have taken steps within 24 hours to resolve the taxpayer's issue, these cases also meet the definition of "same day." Don’t refer these cases to TAS unless the taxpayer asks to be transferred to TAS and the case meets TAS criteria. When you refer cases to TAS, use Form 911, Request for Taxpayer Advocate Service Assistance, and application for Taxpayer Assistance Order and forward to TAS.

    Refer also to IRM 21.1.3.18, Taxpayer Advocate Service (TAS) Guidelines, for more information. The NTA toll-free number, 877–777–4778 or TTY/TDD 800–829–4059, should be provided to the taxpayer and the taxpayer should be advised TAS is available if the taxpayer isn't satisfied with the service he or she received.

  4. The National Taxpayer Advocate has reached agreements with the Commissioners of the Wage & Investment (W&I) Division, Small Business & Self-Employed (SB/SE) Division, Tax Exempt Government Entities (TE/GE) Division, Criminal Investigation (CI), Appeals and Large Business & 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). The SLAs are located at http://tas.web.irs.gov under the heading "Policy/Procedures/Guidance" .

  5. TAS uses the Operations Assistance Request (OAR) process when either the statutory or delegated authority to complete a case transaction rests outside of TAS. TAS utilizes Form 12412, Operations Assistance Request, to initiate the OAR process.

  6. In preparation for a case referral, the TAS employee is responsible for preparing Form 12412, Operations Assistance Request, securing all necessary supporting documentation, identifying cases which require expedite processing (requests for expedite processing will be made on a case-by-case basis) and forwarding Form 12412 and documentation to the business unit liaison.

  7. The Operating Divisions and Functions are responsible for assigning a liaison in each office or Campus where a Taxpayer Advocate is located and acknowledging receipt of the case within one workday for cases requiring expedite processing or within three workdays for all other cases. The Operating Division and Functions will provide TAS with the name and telephone number of the group manager or employee assigned to the case and determine a reasonable time frame for case resolution. Upon closing the OAR, the employee will complete Section VI of Form 12412 and return it to the TAS employee assigned to the case.

  8. For more detailed information about the OAR process, please refer to IRM 13, Taxpayer Advocate Service.

Processing Procedures

  1. Observe the following basic procedures for all work processed in Entity Control:

    1. Batch all work with appropriate local form.

    2. Make all edit markings and Entity Control action trails in purple pen or pencil. This color indicates EO Entity has reviewed the document.

    3. Make corrections to the name, address, subsection, or TIN fields directly on the return. In addition, edit all transaction codes, letters sent, and employee stamp on the left side of the return. If the return is a 990 series return, edit the subsection and foundation code with information from IDRS on the left side of the return.

    4. Perfect the entity for processing: underline the name control per exception, correct the name (as needed per research of the Secretary of State’s office via the internet), EIN, name control, address, Fiscal Year Month (FYM) or tax period, Filing Requirement Codes (FRCs) etc. if needed, and annotate your actions in the lower left corner of the document.

    5. Always utilize a CC INOLE on an EIN before taking any action.

  2. If an organization sends in an original document (not a return) with their correspondence, prepare a Form 3699, Return of Documents to Taxpayer, and return the item to the organization.

  3. Check all returns to determine if the return has all ready posted. If an organization sends in an original return, the first page of the return or a copy of a return with their correspondence and if the same return has already posted for the tax period, "X" out of the return and send the return to Files to be associated with the posted return.

  4. When a Form 990 group return is submitted and box H(b) is submitted a list of subordinates should be attached. Entity will input a TC 590/014 for all subordinates on the list. Once the TC 590/014s are complete, stamp the left side of the return indicating the 590/014 input.

  5. If the return has not been stamped by the Imaging Unit, check to see if the return has posted, if not route the return to Imaging after completing all entity actions including TC 590/014 for subordinates of a group return. If the return was previously stamped by Imaging, route the return for processing. If the return has already posted, X out the return and send the return to Files to be associated with the posted return. Do no send to Imaging or to be processed.

Processing Time Frames and Batching Requirements

  1. Incoming mail and cases are either delivered to the EO Entity Clerical Support area or are picked up by an EO Entity designee from the appropriate areas on, at least, a daily basis.

  2. All time frames start from local received date unless otherwise specified. The turnover time frames are as follows:

    • Returns from Receipt and Control is five (5) days from the IRS received date.

    • Returns from all other functions is five (5) days from receipt in the Entity function.

    • Expedite cases are two (2) days from receipt.

  3. Basic sorting categories with the working time frames and batch sizes are as follows:

    BBTS Category Required Time Frame Work Type Suggested Batch Size Acceptable Overaged %
    SS – 4 5 Form SS – 4 25 5
    Returns 5 BMF/EO 25 20
    EO Extensions 5 Form 8868 25 20
    Rejects 10 Error Correction 25 20
    1128 30 Form 1128 25 20
    Corr. 30 Correspondence ( pilot vouchers) 25 20
    EO Undeliverables 30 Undeliverable notices, undeliverable SGRI's 25 20
    SGRI 60 SGRI 20 20
    EO TDI 30 EO TDI 25 20
    All Other 30 Address Changes, CPs, 59X Transcripts, Form 2363 Changes 25 or less 20
    REV EMP C 45 REV EMP C Transcripts 25 or less 20
    Private Activity Bonds 30 Private Activity Bonds 25 or less 20
    527 Political Organizations 2 Forms 8453-X/8872 25 or less 5
    Special Projects 30 Special Projects 25 20
  4. The campuses may expand the basic categories. In this case, base the batch size of each category on batch sizing theory.

  5. If, in sorting the mail, an item belongs in another category, sort as appropriate.

  6. The sorter must have a better than average knowledge of Taxpayer Advocate cases. If the item meets prescribed Taxpayer Advocate criteria, don’t sort as previously instructed. Refer these items to the Manager or designee for expedite handling. See IRM 13.1.7 for TAS case criteria.

  7. Base batch sizes on a theory of volume. TAll entity cases are to be worked within a time frame based on IRS received date, batch all work by the end of each day or whatever time the campus designates as end of day. Therefore, work batched late in the day most likely will not meet maximum batch size. In addition, other circumstances may dictate batch sizes be smaller than prescribed.

  8. Although not required, combine partially worked batches of like cases and same date in order to keep the work flowing and reduce inventories. An example is, an examiner has a batch of 100 Forms SS - 4 with 25 completed cases and a batch of 100 Forms SS–4 with 75 completed cases. Both batches have the same received date. Combine the 25 and 75 completed items and release as one batch leaving the examiner with one unworked batch of 100 Forms SS - 4.

  9. It is important to be able to readily identify types of work and the working time frame without having to look at each individual batch. One way of achieving this is to use colored folders for the batches of work.

  10. There are certain types of cases which are generally not delivered to EO Entity by mail. Instead, they are hand-carried to the Manager or a designee. It is the Manager's responsibility to batch these cases with the appropriate working time frames.

  11. The point of count is a step in the process when work is counted, released, completed and/or resolved. A document, module, transcript etc., is counted as one. Refer to IRM 25.8.1, OFP codes Overview. For example; consolidations should be counted once under the specific category of the document being worked and once for each additional employer identification number being consolidated excluding the original number.

Re-batching Work

  1. If, during a given week, work was batched under an incorrect category, re-batch the work to the correct category, but only during the initial week.

  2. If work is batched under a given category and it is necessary to suspend any of the items in the batch or the entire batch, don’t move the batch or work to a category with a longer aging criteria. It is recognized cases cannot always be worked within the given time frame and will result in aged cases; however, by aging the cases, the yearly receipts will not be unnecessarily inflated.

Section 3705(a), IRS Employee Contacts

  1. Background

    1. The Restructuring and Reform Act of 1998, Section 3705 provides identification requirements for all IRS employees working tax-related matters.

    2. IRS employees are required to give their name and unique identification number during taxpayer telephone, face-to-face and manually generated correspondence. In addition a telephone number the taxpayer may call is required on all taxpayer correspondence.

    3. 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 office, 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:

    • Telephone Contact - title (e.g., Mr., Mrs., Ms., Miss), last name and badge identification (ID card) number

    • Face-to-Face - title (e.g., Mr., Mrs., Ms., Miss), last name and badge identification (ID card) number provided at the appropriate time during the conversation

    • Correspondence - title (e.g., Mr., Mrs., Ms., Miss); last name; IDRS, letter system or badge identification (ID card) number; and telephone number where the taxpayer's question can be answered

      Note:

      The IDRS number and numbers for some other letter systems are automatically generated. If it isn't generated, or a handwritten note is prepared, the ID card (badge) number must be used.

  3. Toll-free employees may also provide their location for identification purposes. E-mail and faxes to taxpayers on general tax information, are considered manually-generated correspondence and must include the required information.

  4. Manually generated correspondence, whether sent directly to the taxpayer or to the taxpayer's personal representative, must contain the required information.

  5. When a taxpayer insists on speaking with a specific employee who previously handled their 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.

  6. Correspondence 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 the taxpayer may have about the correspondence, or the employee is asking the taxpayer to provide additional case-related information. Otherwise, if the taxpayer doesn't need to contact a specific employee, the correspondence needs only an IRS telephone number and standard signature.

  7. It isn't necessary to repeat the ID card (badge) 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 by telephone or in-person) their ID card (badge) number on the first contact.

  8. Before disclosing any tax information in all types of taxpayer contact, you must be sure you are speaking with an authorized representative of the organization.

    Note:

    Please see the discussion of tax exempt organizations at IRM 11.3.2.4.6. Also, before leaving any messages on an answering machine, please review IRM 11.3.2.6.1. Fax procedures contained in IRM 11.3.1.10 must be reviewed prior to faxing confidential information.

Quality Analysis

  1. The EO Entity Manager, Lead or tax examiner should monitor recurring problems in processing areas. The EO Entity manager will initiate a Quality Analysis (appraisal) when appropriate. The Ogden TEGE Processing Center Program Staff at Mail Stop 1110 must be notified of all quality analysis reviews. The Quality Analysis should include examples and figures showing volumes and percentages. Any information copy will be forwarded to the Chief, Planning and Analysis Staff.

  2. The Quality Review tax examiner is assigned the following:

    • To review the area responsible for the error.

    • To respond to their Manager within five (5) workdays with recommended corrective action.

    • To follow-up on significant problems to assure corrective actions were taken.

  3. All EO entity work needs to be submitted timely to Quality Review to ensure the Quality Review tax examiner can review the work in a timely manner. See IRM 21.3.8 for further information.

  4. Any instructions written at the service center (e.g., desk procedures) to clarify IRM 3.13.12, EO Account Numbers, may be implemented once the instructions are approved by the Document Perfection Section Chief and the Ogden TEGE Processing Center Program Staff at Mail Stop 1110.

Employer Identification Numbers (EIN)

  1. For instructions on how to assign an employer identification number (EIN), see IRM 21.7.13.

Research Tools

  1. Before assigning a new EIN, always perform research to determine if there is an EIN already assigned to any organization.

  2. Use the following systems for research:

    • Taxpayer Information File (TIF) Command Code ENMOD

    • National file of name and address Command Code NAMEE/NAMEB

    • BMF with Command Codes INOLE, BMFOL, or BRTVU

    • Tax modules which are on IDRS with Command Code TXMOD

    • Everything available on IDRS with Command Code SUMRY

    • BMF Retention Register on microfilm

    • Alpha and Numeric ZTIF Register for NMF EINs on microfiche

Group Exemption Roster - CC EOGEN

  1. This listing is numeric by GEN (Group Exemption Number) showing EIN and parent name. It also has an alpha listing with the following information:

    • Name of organization—first 50 characters as it appears on BMF

    • GEN - group exemption number

    • EIN - employer identification number

    • SS - subsection number

    • TF - type of foundation

    • CL - classification code

    • RD - ruling date

    • ST - status code

    • FF - file folder number

    • AC - activity code

    • DT - deductibility code and year

    • City and state where parent organization is located

  2. The data for this listing is extracted twice a year and is printed as Document 6023.

  3. Command Code (CC) EOGEN can do the following:

    • Find a parent organization using CC EOGENP.

    • Provide a list of subordinate organizations for the parent organization by using CC EOGENS. This list is limited to 30 pages with 20 subordinates per page.

    • Narrow the search for subordinates using the state abbreviation or"." for foreign addresses. This is especially helpful when researching large organizations such as Little League, Lions Club International, etc.

  4. Command Code (CC) EOGEN cannot do the following:

    • Research by EIN. If you know the EIN but not the GEN, research CC BMFOL, definer O to get the GEN, then research CC EOGEN.

    • Provide full entity information for subordinates. It provides a starting point for further research.

  5. Command code EOGEN with definer code "P" will generate BMFOLO for the parent's EIN.

  6. Command code EOGEN with definer code "S" will generate a list of the subordinates for the GEN.

  7. For further information on the proper format and use of CC EOGEN, see IRM 2.3.

Name Search Facility

  1. The Name Search Facility (NSF) provides national centralized name search capability which replaces the Key Index File (KIF).

  2. Access NSF using CC NAMES for SSN searches and CC NAMEE/NAMEB for EIN searches. Command Codes NAMES and NAMEB allow you to query a national file of name and address data at the Martinsburg Computing Center (MCC), using a taxpayer name and address to locate a Social Security Number (SSN) or Employer Identification Number (EIN).

  3. The NSF will match the data you entered to data in the files and will return the SSNs or EINs of possible matches. The more information you enter, the narrower the search and the better the possibility for a match.

  4. You can query using either the primary filer name or a secondary filer name. For an EIN, both primary name and "Doing-Business-As" (DBA) name will be searched. The NAMES and NAMEE Command Codes will adjust for some spelling errors and will perform phonetic matches.

  5. Two command codes, FINDS (SSN/IRSN/ITIN) and FINDE (EIN), were added to the NSF. They use the input TIN to access the NSF data base, and return the name(s), address(es), etc. for the TIN. Users are required to enter the command code name, the definer, and the 9-digit TIN (with no hyphens), including leading zeros, if present. The domestic search requires the definer D and the international search requires the definer I. If users don’t enter a definer, they receive an error message. The FINDS/FINDE results are sorted first by primary TIN (when the search was for the secondary TIN), then by activity cycle, and then by name. The activity cycle is displayed in descending order, with the most current data first.

  6. Refer to IRM 2.3, Terminal Response , for more information.

TE/GE (EP/EO) Determination System (EDS)

  1. EDS is an automation of certain segments of the EP/EO determination process. EDS is a menu-driven system. The Inventory Control Subsystem and the Letter Generation Subsystem are the two segments EO Entity will use.

  2. The Inventory Control System replaces EACS as the system which tracks cases from opening to closing; however, EACS, which is renamed Master File Pipeline System continues to function in the campuses as the link between EDS and Master File.

  3. The Letter Generation Subsystem provides a means to automatically generate requests for additional information and the viewing and generation of closing letters.

  4. Use the EDS Instructional Job Aid to operate the menu-driven system.

  5. The following is a list of the Open Status Codes:

    Open Status Codes Definition
    31 In Review
    32 Returned on Review Memo
    33 Returned to Quality
    35 30 Day Letter Sent
    37 Group Suspense
    38 Review Suspense
    39 Technical Screening Suspense
    40 Proposed Adverse Determination
    41 Proposed Technical Advice
    50 New Case Establishment
    51 Centralized Unassigned Inventory
    52 Case Assignment (Non Merit)
    53 Manager Returned to Specialist
    54 Transferred to Appeals (Suspense)
    55 Waiting for Closing Approval
    56 Technical Advice Transfer (Suspense)
    57 TEDS Awaiting Closure on EDS
    58 Case in Transit
    60 Open in Technical Screening
    61 Unassigned in Inventory (Merit)
    62 Assigned in Technical Screening
    63 New Case Establishment (TEDS) (Cases established on EDS have an initial status of 50.)
    64 Manager Returned to Specialist (Technical Screening)
    71 Unassigned Inventory
    72 Case Assignment
    73 Manager Returned to Specialist
    74 Awaiting Managerial Review (TEDS)
    75 Group Inventory
    91 Unassigned Inventory (Washington)
  6. The following is a list of Closed Status Codes:

    Closed Status Codes Definition
    01 Approved
    02 Disapproved
    03 Returned Incomplete
    04 Withdrawn by T/P
    06 Merit closure No Contact
    08 Refusal to Rule
    09 Merit Closure Intermediate Processing
    11 Failure to Establish
    12 Other
    30 Correction Disposal
  7. The following is a list of Type of Request Codes:

    Type of Request Codes Definition
    I Initial
    A Amendment
    T Termination of Exempt Status ( Termination cases are no longer established by Determinations)
    P Termination of Private foundation Status
    F Private Foundation Follow-up
    R Returned, Post Review

EO/BMF

  1. There are two parts to the EO/BMF entity module, the BMF portion and the EO section.

EO/BMF Entity Module

  1. The BMF portion of the EO/BMF entity module is created by a TC 000, Doc. Code 04, 63, 80 or 81. It may contain the following information:

    • Employer identification number (EIN)

    • Name control (N/C) or check digit (C/D)

    • Establishment date

    • Employment code (EC)

    • Fiscal year/month (FYM)

    • Filing requirement code (FRC)

    • Primary location code (PLC)

    and the following entity identifying data:

    • Primary name

    • Primary continuation name

    • Sort name

    • Care of name

    • Location address

    • Foreign address

    • Mailing address

  2. The BMF entity module, with its fields defined below, can be changed by IDRS Command Codes ENREQ/BNCHG or EOREQ/EOCHG.

    1. EIN is the Employer identification number assigned to each organization by Entity Control. To change the number, use a TC 011, Document Code 63. TC 011 changes are restricted for input by campuses only.

    2. N/C is created by the coding of the organization's name. To change the name control, use CCs EOREQ/EOCHG with Document code 80, TC 013 or ENREQ/BNCHG with Document Code 63, TC 013.

    3. C/D is the check digit created from the EIN when the account posts to the BMF. It cannot be changed.

    4. Establishment Date is the date the organization started business or was established on the BMF. To create it, use TC 000. It cannot be changed.

    5. EC is the employment code which identifies the type of employment taxes or FUTA (Form 940) taxes an organization is required to pay. To change this code, use Document Code 63 or 80.

    6. FYM is the fiscal year/month created either when the organization is established on the BMF or when the first return is posted. To change it, use Document Code 63 or 80.

    7. FRC, the filing requirement code, for exempt organizations can be for Forms 941/944, 720, 940, 1120, or 1041 under certain conditions. These FRCs can be changed with a Document Code 63 or 80. The positive EO FRCs for Forms 990, 990-EZ, 990-T, 990-PF and 5227 can only be changed with a Document Code 80. Delete all FRCs with CC BNCHG Doc. Code 63.

      Exception:

      Delete the FRC for Form 1041-A with a TC 591/020 on the last 1041 filed..

    8. The Universal Location Code (ULC) is the area office codes based on the address where the organization receives mail. The BOD code will be used for routing work load to the appropriate campus; in other words, all accounts with a TE BOD code will be processed by the Ogden Submission Processing Center.

    9. SSN Sole proprietor cross reference SSN - The business owner's SSN added to identify ownership of a BMF account. The SSN must be removed if the account becomes tax exempt. Failure to remove the SSN will cause an unpostable when adding a subsection.

  3. The Entity Identifying Data are defined below:

    1. Create the primary name and primary continuation name by inputting a TC 000. To change them, use a TC 013, Document Code 80, CCs EOREQ/EOCHG or Document Code 63, CCs ENREQ/BNCHG.

    2. Sort name is used to identify the organization another way. For organizations with a group ruling, the sort name identifies the chapter, union, etc.

    3. Care of name is used if the taxpayer identifies a person or a place, e.g., Merchants Bank-Trust, for mailing.

    4. Location street address is the street address where the organization is located and is different from the mailing address. It can be a foreign address.

    5. Location City/State/ZIP is the city or country where the organization is located.

    6. Foreign address is used when the organization has a foreign mailing address.

    7. Mailing street address is where IRS will mail notices and returns. If it's a foreign address, it will contain the city of the foreign country and ZIP code.

    8. Mailing City/State/ZIP is where IRS will mail notices and returns. If it's a foreign address, the city will be the country, and the state and ZIP will be a blank.

EO Section of the BMF

  1. Create the EO section of the EO/BMF entity module for a new entity by a TC 000, Document Code 80 or 81. If the entity is already on the BMF, create the EO section by Transaction Code 016 with a Document Code 80 or 81.

  2. The EO section information can only be changed by CCs EOREQ/EOCHG. The EO section contains the following information:

    1. Subsection (SS), current and prior, identifies the IRC under which the organization is exempt. It also determines the type of return the organization will file. The current SS will be shown on the CC INOLE, CC ENMOD, and CC BMFOLO. The SS is assigned when the organization's request for exemption is approved. To make a change to the subsection, it must be approved by Cincinnati and updated from EDS or a determination letter. New applications processed as of July 2007 will also be updated in TEDS. If an erroneous subsection is on the BMF with Status 06, 10, 11, 40 or 41, delete it with the input of a TC 022.

    2. Classification code (CL) identifies the type of organization or the purpose for which it was established. One to four different codes may be present. The CL will be shown on CC INOLE, CC ENMOD and CC BMFOLO. The CL can be changed only by Cincinnati.

    3. Status code and date (ST), current and multiple prior status, indicates the status of the organization. The code identifies whether or not the organization was granted an exemption or, it was applied for, revoked or terminated. The ST is normally established by Cincinnati when the exemption is granted, denied or revoked. The campus can establish ST Codes 06, 07, 10, 11, 12, 20, 36, 40 and members of a group ruling. Also, the campus can re-establish Status 01 when it is on EDS or from a determination letter, or re-establish a good status after ST 20, 21, 26, 28, or 29 has posted. The current ST is shown with the status date (YYYYMM) on CCs BMFOLO, INOLE, and ENMOD.

    4. Affiliation code (AF) indicates an individual ruling or group ruling. The AF is shown on the CC INOLE, CC ENMOD and CC BMFOLO. It normally isn't changed unless the entity is changing from a group to an individual ruling, or from an individual to a group ruling.

    5. Ruling date (RD) is the date the exemption was granted or ruled on. The RD is shown on CC ENMOD, CC INOLE, and CC BMFOLO. This date is normally not changed except by Cincinnati.

    6. Group exemption number (NG) or GEN is the number Cincinnati assigns when the organization is granted a group exemption. This number is used to identify all the organizations (subordinates) which are a part of the group. The GEN is shown on CC INOLE, CC ENMOD, and CC BMFOLO. It can be changed, but CAUTION must be used.

    7. Foundation code (TF) is the code given to all organizations exempt under IRC 501(c)(3). This code identifies the type of foundation. The TF is shown on CC INOLE, CC ENMOD and CC BMFOLO. To change the foundation code requires approval from Cincinnati and the campus can only update it from TEDS, EDS or a determination letter or Form 990-PF. If a foundation code is on the BMF but the subsection changed to one which doesn't require a foundation code, delete it with the input of a 99.

    8. Deductibility code and year (DY) indicates whether contributions to the organization are deductible from income. The code is determined by Cincinnati when the exemption is granted and can be changed only by Cincinnati.

    9. Activity code (AC) identifies the principal activity of the organization. This code is normally changed by Cincinnati.

      Note:

      Activity codes may still be present on accounts, however, they are no longer assigned or actively used.

    10. National Taxonomy of Exempt Entities Code (NTEE) is a system of classifying the purposes, activities and fields of interest of non-profit organizations. The "NTEE system" will eventually replace the present activity codes. This code is assigned by and normally changed by Cincinnati.

      Note:

      NTEE codes may still be present on accounts, however, they are no longer assigned or actively used.

    11. North American Industry Classification System (NAICS) code is a new 6-digit PBA code which will replace the old 4 digit PBA code. The EO activity code is actually the PBA code. Both the activity code and the NAICS code will be maintained on the EO section.

    12. Type of organization (TO) indicates whether the organization is a trust, corporation or an unicorporated association. The TO is shown on CC INOLE, CC ENMOD, and CC BMFOLO. The code is assigned by Cincinnati when the exemption is granted and is normally changed by them. The campus will input the TO on all group rulings.

    13. File folder number (FF) identifies the administrative case file folder number located in Cincinnati. The FFN is assigned by Cincinnati when an application for exemption is received. The FFN will normally not be changed. The FFN is shown on CC BMFOLO.

    14. Pension plan (PP) indicates whether or not the organization has a pension plan. It is assigned by Cincinnati when the exemption is granted and is normally changed by Cincinnati.

    15. Cumulative list indicator (CU) identifies an organization which is included in the cumulative list (Pub. 78). It is input by the National Office or Cincinnati and changed by them.

    16. TEP case code (TEP) is input if the organization is identified as a "large case."

    17. Posting delay code (PDC) may be input (Range 1-6) with the transaction to be "cycled" when multiple transactions are required to adjust an account.

      Note:

      For example, in a complex adjustment with seven transactions where two must post three cycles after the first four, and the last must post a cycle after second two, input a Posting Delay Code 3 with the fifth and sixth transactions, and four with the last transaction. Posting of these transactions to the MCC MF will be deferred until the indicated number of posting cycles has passed. All transactions will be input at the same IDRS terminal session. Cycled transactions will be held on the MCC re-sequencing transaction files until the required staggered sequence among the transactions. Posting delay capability is provided for the following IDRS entity change command codes: CCs ENREQ/BNCHG and EOREQ/EOCHG (Doc. Codes 50, 53, 63, 80 and 81).

Entity Changes for an EO/BMF Account

  1. Knowledge of several command codes will be necessary for the successful input of entity information for Exempt Organizations. IRM 3.13.12.6 supplements IRM 2.4, IDRS Terminal Input. The input of the EO Entity change requires the following succession of Command Codes: ENMOD, and then EOREQ/EOCHG.

    • CC ENMOD shows whether the account is on the BTIF and stores data required by CC EOREQ.

    • CC EOREQ creates an input screen format for CC EOCHG. If the account isn't on the BTIF, CC EOREQ will also build a "dummy" account and an entity case control on the TIF.

    • CC EOCHG puts a "pending" record of the transaction on the TIF and creates a record used for quality review, for production of a transaction for the Business Master File and for printing an IDRS Transaction Record (Form 5147).

  2. Any CC EOCHG input will create an EO section on the BMF.

    Note:

    Be sure it is an EO account before using CC EOCHG.

  3. When inputting EOCHG, be alert to the unpostables which will be created when the BMF attempts to update or create an EO section. See IRM 3.12.278 for EO Unpostable Resolution procedures. The following unpostable codes are applicable to EO entity changes with a brief description:

    • 302 - Input TC 000 and the EIN is already on the BMF.

    • 303 - Name control input doesn't match name control on BMF.

    • 307 - Fiscal month discrepancy with the BMF.

    • 308 - Filing requirement discrepancy.

    • 313 - No related transaction.

    • 329 - Inconsistent filing requirements.

    • 341 - Invalid TIN.

    • 343 - Input attempts to update FRC and it doesn't agree with employment code or vice versa.

    • 358 - Incompatible EO status with BMF status.

    • 359 - The input of TC 020 or TC 022 and the module contains conditions which indicate the account should not be deleted.

    • 366 - The input transaction attempts to establish a tax module and there is no Exempt Organization subsection present.

    • 369 - The input of Employment Code W attempting to update the BMF and it doesn't agree with the EO section on the BMF.

    • 370 - The new GEN doesn't match a GEN on the GEN file, or the parent has not been established on the GEN file or is already on the GEN file.

    • 371 - The From GEN doesn't match the GEN on the BMF.

    • 372 - The BMF and the GEN file are not in agreement. This generates when a TC 590 Closing Code 014 attempts to create a TC 590 for all the subordinates on the GEN file and a discrepancy exists.

    • 373 - The input is ST 28 or 29 and the GEN doesn't match the GEN on the BMF, or the BMF Affiliation Code isn't 6, 7, 8, or 9, or the BMF Entity Status isn't 01, 02, 20 or 21.

    • 379 - TC 012 and TC 013 attempts to post and the BMF doesn't have an EO section.

    • 382 - EO TC containing a subsection and no EO section on BMF.

    • 429 - FRC input doesn't agree with FRC on the BMF.

    • 495 - A transaction attempting to update the first primary name line and the sum of the character count doesn't equal the actual length of the primary name line.

EO Transaction Codes

  1. EO Transaction Codes include TC 000, 012, 013, 014, 016, 020, and 022.

  2. The following format fields appear on the EOCHG screen:

    • EOCHG

    • EIN

    • NM-CTRL - Name Control

    • DOC-CD - Document Code

    • TC - Transaction Code

    • TRANS-DEFINER-CD - Transaction Definer Code

    • PSTNG-DLAY-CD - Posting Delay Code

    • NEW-NAME-CTRL - New Name Control

    • PRIMARY-NAME - Primary Name - two available lines

    • SORT-NAME - Sort Name or DBA

    • CARE-OF-NAME - Care-of Name

    • FOREIGN-STREET - Foreign street address

    • MAIL-STREET-OR FOREIGN-CITY/ZIP- Mailing Street Address or Foreign Country

    • MAIL-CITY/STATE/ZIP-OR-FOREIGN COUNTRY - Mailing City, State, Zip or Foreign Country

    • LOCATION-STREET-ADDRESS - Location Street Address

    • LOCATION-CITY/STATE/ZIP - Location City, State, Zip

    • SUBSECT-CD - Subsection Code

    • FNDTION-CD - Foundation Code

    • CLSF-CD - Classification Code

    • AFFLTIN-CD - Affiliation Code

    • TYPE-ORG - Type of Organization

    • HOSP-IND - Hospital Indicator Code

    • STS-CD/DT - Status Code/Year/Month

    • RULNG-DT - Ruling Date

    • ACTY-CD - Activity Code

    • CONTRIB-DED-CD/YR - Contribution Deductibility Code Year

    • FRM-GRP-EXEMP-NUM - From Group Exemption Number

    • NEW-GRP-EXEMP-NUM - New Group Exemption Number

    • FFN- File Folder Number

    • 944-BYP- 944 Bypass Indicator

    • PENSION-PLN-CD - Pension Plan Code

    • ADVNC-RULNG-DT - Advance Ruling Date

    • TEP-CASE-CD - TEP Case Code

    • CUM-LST-IND - Cumulative List Indicator

    • EMPLMNT-CD - Employment Code

    • FYM - Fiscal Year Month

    • NTEE - National Taxonomy of Exempt Entities Code

    • NAICS-CD - North American Industry Classification System Code

    • F944-YR/IND- Form 944 Year Indicator

    • FILING-REQUIREMENTS - Filing Requirements

    • REMARKS - Remarks

  3. The information for some of the fields will be taken from the pilot voucher, EDS, correspondence or the returns.

  4. The following tables show a quick reference to the valid fields with Document and Transaction Codes.

    DOCUMENT CODE 80 VALID FIELDS
    TITLE TC000 TC012 TC013 TC014 TC016
    Name Control X X X X X
    EIN X X X X X
    Transaction Code X X X X X
    Employment Code X X
    Fiscal Year Month X X X
    From GEN X
    Filing Requirement X X X
    Definer Code X X
    Subsection Code X X X
    Classification Code X X X
    Status Code/Date X X X
    Affiliation Code X X
    Ruling Date X X
    New GEN X X
    Type of Foundation X X X
    Deductibility Code/Year X X
    Activity Code X X
    Type of Organization X X
    District of Location X X X
    File Folder Number X X
    Pension Plan X X
    Advance Ruling Date X
    Cumulative List Indicator X
    Large Case Code X
    Organization Name X X
    New Name Control X X
    Sort Name X X X X
    Care of Name X X X X
    Foreign Street Address X X X X
    Mailing Street or Foreign City/ZIP X X X
    Mailing City/State/ZIP or Foreign Country X X X
    Location Street Address X X X X
    Location City/State/ZIP X X X X
    National Taxonomy of Exempt Entities X X
    Remarks X X X X X
    DOCUMENT CODE 81 VALID FIELDS
    TITLE TC016
    Name Control X
    EIN X
    Transaction Code X
    Employment Code
    Fiscal Year Month X
    From GEN X
    Filing Requirement X
    Definer Code X
    Subsection Code X
    Classification Code X
    Status Code/Date X
    Affiliation Code X
    Ruling Date X
    New GEN
    Type of Foundation X
    Deductibility Code/Year X
    Activity Code X
    Type of Organization X
    District of Location
    File Folder Number X
    Pension Plan X
    Advance Ruling Date
    Cumulative List Indicator
    Large Case Code
    Organization Name
    New Name Control
    Sort Name
    Care of Name
    Foreign Street Address
    Mailing Street or Foreign City/ZIP
    Mailing City/State/ZIP or Foreign Country
    Location Street Address
    Location City/State/ZIP
    National Taxonomy of Exempt Entities X
    Remarks X

TC 000

  1. Transaction Code 000 establishes an account on the BMF for the first time. These accounts may be entered in one of two ways:

    1. CC ENREQ/CC BNCHG, Doc. Code 63 is used when no EO section needs to be established.

    2. CC EOREQ/CC EOCHG, Doc. Code 80 is used when an EO section needs to be established.

  2. If no EO section needs to established:

    1. CC ENREQ is used to request a CC BNCHG format for input of an entity change transaction. It must be preceded by a CC ENMOD. If the TIN isn't located on the Master File, an intend indicator of 1 must be input. The intend indicator will generate a TC 000.

    2. The required fields for CC BNCHG TC 000 transactions are Doc. Code 63, name control, primary name, city, state, ZIP and filing requirements.

  3. If an EO section needs to be established:

    1. CC EOREQ is used to request an CC EOCHG format for input of an entity and/or EO section change transaction. If the TIN isn't located on Master File, an intend indicator of 1 must be input. The intend indicator will generate a TC 000.

    2. The required fields for CC EOCHG TC 000 transactions are Doc. Code 80, primary name, EO status code and date, and at least one of the following filing requirements: 990-T, 5227, 990 or 990-EZ, 990-PF or NR.

  4. Any transaction which needs to be cycled or held for later input can be cycled up to 6 cycles using a posting delay code. See IRM 2.4, IDRS Terminal Input.

  5. When inputting a TC 000 with CC EOREQ/EOCHG, Document Code 80, the following fields are required:

    • Primary name

    • New name control

    • Mailing address (local)

    • Mailing, city, state and ZIP

    • Status code and date

    • One of the following FRs: 990, 990-PF, 990-T, 5227, NR (Not Required)

    Note:

    Always input a Form 990 or Form 990-PF FR if Form 990-T is a FR. If one of the FRCs (other than NR) is input, input the subsection, foundation code (if applicable), classification code, and fiscal year month.

TC 012
  1. Transaction Code 012 reopens an account. Input this TC with either CCs ENREQ/BNCHG or CCs EOREQ/EOCHG.

  2. TC 012 reopens an inactive account where a consolidation was attempted but cannot be consolidated because duplicate modules exist and cannot be deleted with TC 020 or 022. Filing requirements of such accounts are all 8s. The transaction will not post to the account unless all FRs are changed to either a significant code or zero.

  3. When inputting a TC 012 with CC EOREQ/EOCHG, Document Code 80 only, the following fields are required:

    • One of the following Status Codes and Date: 01, 06, 07, 10, 11, 12, 18, 19, 40 or 42

    • Fiscal year month

    • Definer Code A

    • One of the following FRs: 990, 990-PF, 990-T, 5227

      Note:

      A Form 990 or Form 990-PF FR must be input if 990-T is a FR.

    • Subsection, foundation code (if applicable), and classification code

    • Remarks

TC 013
  1. Transaction Code 013 indicates the primary name line was changed. This TC can be input using either CCs ENREQ/BNCHG or CCs EOREQ/EOCHG.

    1. Always use the Master File name control, not a check digit or dummy name control when changing the name lines.

    2. If necessary, change the name on the P Tape also.

    3. IRM 3.13.12.6.9 for specific procedures to input a corporation name.

    4. IRM 3.13.12.6.10 for specific procedures to input a trust name.

    5. IRM 3.13.12.6.11 for specific procedures to input the name of a non-profit organization.

  2. Any request to change a name on an Exempt Organization account must be accompanied by appropriate documentation in order to be considered.

    Caution:

    IRM 3.13.12.12.12.4.1 before changing a subordinate's name.

    1. If the type of organization is a 1 on EDS or on BMFOLO, the organization is incorporated with the state. A state-approved amendment to the articles of incorporation which indicates both the old and new name of the organization along with proof of filing with the state are required.

    2. If the type of organization is a 2 on EDS or on BMFOLO, the organization is a trust. An amendment to the trust agreement is required along with the trustee(s) signature.

    3. If the type of organization is a 5 on EDS or on BMFOLO, the organization is an unincorporated association. An amendment to the articles of association, constitution, by-laws or other organizing document is required along with signatures of at least two officers/members.

    If Then
    Accompanying information is present, or can be verified on the Secretary of State web sites Input a TC 013 with Doc. Code 63. Send a 252 C Letter to the organization acknowledging the change to its name.
    Accompanying information isn't present, Inform the taxpayer with Letter 1224C the name change can't be made, unless one of the items listed above is present.
  3. Name changes which don’t require documentation are:

    • Misspelled names

    • Name control mismatch

    • Accounts in EO Status 06, 11, 12, 36, 40, or 42

    • Organization is a church.

    • Organization is a credit union.

  4. When inputting a TC 013 with CC ENREQ/BNCHG, Document Code 63 only, the following fields are required:

    • Primary name

    • New name control

    • Remarks

TC 014
  1. Transaction Code 014 indicates the account address, i.e., domestic street address, mailing city, state and ZIP, has changed. This TC can be input using either CCs ENREQ/BNCHG. Address changes may be necessary when working unprocessable returns, EO correspondence, EO TDIs, and EO unpostables.

    Caution:

    Always verify the address on a return. If the address on the return is different from the address on Master File, always input a TC 014 to change the address even if the change is minor; e.g., the apartment number.

  2. Use the following guidelines for inputting addresses:

    1. If a foreign street address in input, input the foreign city and foreign country in the mailing street address and mailing city, state and ZIP line.

    2. A foreign postal code may be input.

    3. If a foreign country is input, input "." in the state field.

    4. If a foreign city or postal code is input, input the foreign street address.

    5. If a domestic mailing city, state and ZIP or major city code and ZIP code are input, input the mailing street address.

    6. If a major city code is input, input a mailing ZIP code.

  3. If it can be determined the correspondence was initiated by a third party, research the CAF using CC CFINK.

    1. If a proper authorization isn't found, send Letter 135C and destroy the request.

    2. If a proper authorization is found, update the address as requested.

  4. When inputting a TC 014 with CC ENREQ/BNCHG, Document Code 63 , the following fields are required:

    • Mailing address, city, state and Zip (always input if present)

    • Remarks

TC 016
  1. Transaction Code 016 indicates a change to data already on the BMF such as:

    • BMF filing requirements

    • Railroad Retirement Board Numbers

    • Form 8123 code

    • Fiscal year month

    • Employment code

    • EO section

    • Sort name

    • Care of name

    • Location street address

    • Location city, state, and ZIP

  2. This TC can be input using either CCs ENREQ/BNCHG or EOREQ/EOCHG.

  3. Use Document Code 81, Definer Code D, with TC 016, when exemption data for all subordinates under one GEN number is being changed. The input document must contain the From GEN, the parent's EIN, name control, status code and month, ruling year and month and affiliation code. When this TC is used, a transaction, identical to the input TC 016, will be generated for every subordinate on the GEN file for posting to the BMF.

  4. When inputting a TC 016 with CC EOREQ/EOCHG, Document Code 80, the following fields are required:

    • Remarks

    • Definer codes, OR

    One of the following must be present:

    • Deductibility code and year

    • Activity code

    • Type of organization code

    • File folder number

    • Pension plan

    • Advance ruling date

    • Cumulative list

    • TEP case code

    • Sort name

    • In care-of-name

    • Subsection, if input is 99

    • Foundation Code, if input is 99

  5. When inputting a TC 016 with CC EOREQ/EOCHG, Document Code 81, the following fields are required:

    Note:

    A New GEN cannot be input with Doc. Code 81.

    • Remarks

    • From GEN

    • Definer codes, OR

    One of the following fields must be present:

    • Deductibility code and year

    • Activity code

    • File folder number

  6. When adding filing requirements to an account in a good status with TC 016 CC EOREQ/EOCHG, Document Code 80, the following fields are required:

    • Definer Code ABC

    • Subsection code

    • Foundation code (if applicable)

    • Classification code

    • Status code and date

    • Ruling date

    • FYM

    • Filing requirements

    • Remarks

  7. If an account is in good status and you are adding filing requirements, check ENMOD to determine if a date is present in the DBC Field. If a date is present, zero out the date prior to adding filing requirements. To zero out the date, input a TC 016 on ENREQ/BNCHG enter eight "9" s in the DT-BUS-CLD field.

TC 020
  1. Transaction Code 020 deletes an account from the Master File if no modules are present which contain return or credit transactions. Use of this transaction requires your lead's or Manager's approval.

    Note:

    Accounts with modules present will remain on the BMF but all the filing requirements will be changed to 8 to indicate the account is in inactive status.

  2. When inputting a TC 020 with CC ENREQ/BNCHG, Document Code 63, the following fields are required:

    • Transaction Code 020

    • Remarks

TC 022
  1. Transaction Code 022 will delete an EO section. Use this TC when a BMF account has an erroneously established EO section.

    Caution:

    Be very sure when using TC 022 you don’t delete a good exemption. Also, if the account shows an open AIMS (TC 420, 424, or 427), or Freeze Codes (-A, E-, -F, J-, -J, N-, O-, P-, -R, -S, T-, -U, -V, W-, -W, X-, -Y, -Z) for any tax module, don’t delete the EO section. It will unpost with a UPC 359. Remember once an EO section is deleted, the account reverts back to a regular BMF. DON’T INPUT TC 022 WITHOUT THE EO MANAGER'S OR LEAD'S APPROVAL except when a TC 022 is input to remove a subordinate from a group ruling to update to either status 36 or 40.

  2. The following are examples of erroneously established EO Sections:

    • A Document Code 80 was used to change an address when a Document Code 63 should be used when no EO section information is present. This condition will result in an Unpostable 379 RC 1.

    • Sometimes organizations use their corporation or similar identifying numbers when applying for an exemption. The exemption is erroneously established on the corporation account (EIN) and subsequently placed in Status 20 to allow the Form 1120 to post.

    • The organization filed a Form 990-T for a 401(a) Trust and the account was erroneously established with EO subsection data. These accounts are often shown in Status 40.

    • Correspondence from the organization states we have erroneously established the account with GEN, exemption data, etc.

  3. Input TC 022 with CCs ENREQ/BNCHG.

    Note:

    A source document isn't required when processing a Form 8868 on an account in EO Status 41.

  4. Don’t use TC 022 with accounts in EO Entity Status of 01-26, 28, 29 and 70-72, unless it is obvious the EO section was erroneously established or the group was dissolved during the SGRI process.

  5. When an EO/BMF account has two EINs which should be merged (consolidated), it may be necessary to delete the EO section for one of the EINs to facilitate the merge. Use Caution when the TC 022 is used for this purpose. Always be sure one of the EINs has a complete EO Section.

Definer Codes

  1. For TC 012 and 016, a definer code will always be necessary if a filing requirement for Forms 990, 990-PF, 990-T, 5227 or NR is input.

  2. Definer Codes A, B, C, D, and F may be input in any position.

    1. All or one of Definer Codes A, B, and C may be present with a TC 016, Document Code 80 or 81.

    2. When entering Definer Code D, it must be the only definer code and the Document Code must be 81.

    3. When entering Definer Code F, it must be the only definer code and the Document Code must be 80.

    4. When the TC is 012 and Document Code 80, Definer Code A must be the only code present.

Definer Code A Required Input
  1. Definer Code A - Document Code 80

    • Transaction Code 012 or 016

    • One of the following FRs: 990, 990-PF, 990-T, 5227, NR (Not Required)

      Note:

      A Form 990 or Form 990-PF FR must be present if Form 990-T is a FR.

    • FYM

    • Subsection

    • Type of foundation (if applicable)

    • Classification code

    • From GEN (if applicable)

    • Remarks

  2. Definer Code A - Document Code 81

    • Transaction Code 016

    • From GEN

    • NR filing requirement of 1

    • Subsection, type of foundation (if applicable) and classification code

    • Remarks

Definer Code B Required Input
  1. Definer Code B - Document Code 80

    • Transaction Code 016

    • Status code and date

      Note:

      For instructions on status codes and dates, IRM 3.13.12.6.18.

    • Remarks

Definer Code C Required Input
  1. Definer Code C - Document Code 80

    • Transaction Code 016

    • GEN

    • Affiliation code

    • Remarks

  2. Definer Code C - Document Code 81

    • Transaction Code 016

    • From GEN

    • Affiliation code

    • Remarks

Definer Code D Required Input
  1. Definer Code D - Document Code 81 only

    • Transaction Code 016

    • From GEN

    • Status code and date

    • Subsection, type of foundation (if applicable) and classification code

    • Ruling date

    • Affiliation Code of 9

    • Form 990 FR of 01

    • Remarks

Definer Code E Required Input
  1. Definer Code E – Document Code 81 only

    • Transaction Code 016

    • Ruling date

    • From GEN

    • New GEN

    • Affiliation Code

    • Remarks

    Note:

    Definer Code E can only be accessed by National Office and the Ogden Submission Processing Center.

Definer Code F Required Input
  1. Definer Code F-Document Code 80 only

    • Affiliation Code of 6, 7, 8, or 9

    • From GEN

    • Remarks

Definer Code G Required Input
  1. Definer Code G - Document Code 80 only

    • From GEN (must not be 0000 or 9999)

    • Affiliation Code of 1, 2, or 3

    • New GEN 9999

    • EO Status Code 01

    • Form 990 FR of 01, 02 or 06

    • FYM

    • Classification Code

    • Subsection Code

    • Foundation Code of 10-18 or 21 -24 if Subsection Code is 03

    • Remarks

Primary, Sort, Care of Names and Name Control

  1. The EO entity portion on the BMF consists of the following 35 character fields:

    • Primary name (legal name)

    • Continuation of primary name

    • Sort name (DBA or business name)

    • Care of name (% and name)

  2. Primary name and continuation of primary name must not be longer than a total of 70 characters or 35 characters each line. Don’t split a word between lines.

  3. Use only the following characters for the legal name:

    • alpha

    • numeric

    • hyphen (-)

      Reminder:

      Don’t leave a space before or after the hyphen. Don’t use a double hyphen.

    • ampersand (&)

    Note:

    Use a percent sign (%) only to identify a care of name.

  4. A period (.) isn't an accepted character. If the organization's name has a period within the name, substitute a space for the period. For example, if the organization's name is A.B.C.D., input the name as A B C D. No space is necessary at the end of the name.

  5. An apostrophe (') isn't an accepted character. If the organization's name contains an apostrophe, omit it. For example, if the organization's name is St. Ann's School, input the name as ST ANNS SCHOOL.

  6. Use the following command codes to change entity fields:

    • ENREQ/BNCHG

    • EOREQ/EOCHG

  7. The entity fields can be input independently, with the exception of the continuation of the primary name which requires the input of the primary name field.

  8. Mail going to a domestic organization will carry two name lines. The priority of these name lines is as follows:

    1. Primary name

    2. Sort name if present on the BMF

    3. Care of name

    4. Foreign street address

    5. Continuation of primary name if no foreign street is present

  9. Input the primary name, care of name and sort name accurately to ensure outgoing mail can be properly delivered.

  10. For accurate identification of an organization, input the following information as a sort name with the number first:

    • Local #

    • District #

    • Unit #

    • School name

    • Governmental division

  11. For accurate identification of a trust, input the following information at the end of the primary name line:

    • Account number

    • Donor number

    • Contract number

Primary Name

  1. Suffixes such as P.A. for Professional Association, P.C. for Professional Corporation, and INC. for Incorporated indicate a corporate entity. To input a corporate entity:

    1. Don’t modify the corporate name. Don’t abbreviate, change symbols or change "and" to "&." The corporation receives its charter from the state exactly as shown by the organization.

    2. Bracket following the word THE] in the corporate name or business name, unless "The" is followed by only one word. This will allow you to use the second word as the name control, but the primary name will be printed on any notice or letter exactly as the taxpayer indicated on his form or return.

  2. The true trust name must appear on the primary name line. If the true trust name isn't present or cannot be determined from the primary name line, contact the organization by phone, fax or letter.

  3. If the parent primary name has the word "Grand" or "Supreme" in it, don’t use the word "Grand" or "Supreme" in the subordinate’s primary name.

  4. If the parent or subordinate insists the subordinate’s primary name is other than the parent’s primary name, honor the organization’s request and change the name.

    Caution:

    IRM 3.13.12.12.12.4.1 before changing the subordinate's name.

    Note:

    This action requires managerial approval before the name change can be made.

  5. If an invalid character is used in the name line, drop the special character from the taxpayer's name. For example, Jones.com would be JONES COM.

  6. Use the individual name to identify political organizations. For example, Committee to elect John Doe for Mayor should be input as JOHN DOE FOR MAYOR COMMITTEE TO ELECT.

  7. When using CC EOREQ/EOCHG, Document Code 80, or ENREQ/BNCHG, Document Code 63 to input the Primary Name Line:

    1. The Transaction Code must be 000 or 013.

    2. All lines must be entered as they should appear on the BMF.

    3. Never enter information in the primary name which isn't a part of the primary name.

    4. The second name line is used as a continuation of the organization name. Never enter a character in the first position.

    5. The new name control must always be entered. For name control procedures, IRM 3.13.12.6.8

    6. When working EO type accounts, IRM 3.13.12 name control corporate and trust procedures should be used.

  8. The "at" sign (@) is a special edit character used to sort certain EO entities for Exempt Organization Select Check.

    1. While standard BMF name control procedures require name control to be the first four characters of the primary name, EO Select Check is sorted on an individual's surname, if it appears in the fund or foundation name.

    2. The "at" sign (@) is placed in front of the individual's surname, whether the surname is on the primary name line or the continuation of primary name line.

    3. A right-hand bracket (]) is input to generate the "at" sign (@).

Sort Name

  1. The sort name is another way to locate the organization. BMF uses the sort name to locate the organization on the National Account Index using CC NAMEE/NAMEB.

  2. If the sort name is an individual name, e.g., a trustee, enter the name as indicated by the filer followed by their title.

  3. Delete the word "The" from the sort name, unless it is only followed by one word.

  4. The sort name can be a:

    • Business or trade name if different from the true name

    • Trustee of a trust, if the trustee is an individual

    • Local #, unit #, district #, council # of a national organization

  5. The sort name can't be a:

    • Care of Name, unless it is an individual trustee

    • Financial or banking institution

    • Location address

    • Officer's name of a corporation, e.g., president or vice-president

  6. Input $$ in the first two positions of the sort name line to delete the sort name.

  7. When using CC EOREQ/EOCHG, Document Code 80 to input the Sort Name (SN):

    1. If the Document Code is 80, the Transaction Code must be 000, 013, 014, or 016.

    2. This is a 35 character field and is treated exactly the same as a BMF secondary sort on the BMF.

    3. The first position must be numeric or alpha.

    4. To delete the SN, input $$.

    5. If the organization is part of a group ruling and the primary name line is the name of the parent, there must be a sort name. The sort name must never be included as part of the primary name.

In Care of Name

  1. When using CC ENREQ/BNCHG, Document Code 63, to input the In Care of Name:

    1. If the CO is input, enter a percent sign (%) in the first position, followed by a space and then the name.

    2. To delete the CO, input $$.

    3. If the Document Code is 63, the TC must be 000, 013, 014, or 016.

  2. Input $$ in the first two positions of the care of name line to delete

Name Control

  1. To input the name control:

    1. Use any combination of 2–4 alpha and numeric characters.

    2. Use blanks only in the last two positions of the name control.

    3. Don’t use ampersand (&) or hyphen (-) in the first position of the name control.

Corporation Name Control
  1. For the name control of a corporation, use the first four significant characters of the corporation's name. To determine a corporate name control:

    1. Bracket the word THE] when followed by more than one word. For example:

      Name: The Meadowlark Co.
      Name Control: THE] MEAD

    2. Include "the" in the name control when it is followed by only one word. For example:

      Name: The Flamingo
      Name Control: THEF

    3. Use corporate name control rules if an individual name contains the abbreviations PC for Professional Corporation, SC for Small Corporation, PA for Professional Association, or PS for Professional Service. For example:

      Name: John Waxwing PA
      Name Control: JOHN

    4. Apply corporate name control rules when the organization name contains the words "Fund" or "Foundation." For example:

      Name: Kathryn Canary Memorial Fdn
      Name Control: KATH

    5. Apply corporate name control rules when the organization name contains the name of a corporation and both the words "Trust" and "Fund."

      Exception:

      For Forms 5227, trust name control rules apply, even if the "Fund" or "Foundation" is in the organization's name. IRM 3.13.12.6.8.2

Trust Name Control
  1. To determine the name control of a trust:

    1. Use the first four characters of an individual's last name. For example:

      Name: Michael I. Azalea Trust
      Name Control: AZAL

    2. Use the first four characters of the corporate name:

      Name: Daisy Corp. Employee Benefit Trust
      Name Control: DAIS

    3. Contact the organization by telephone if the trust name can't be determined. If telephone contact cannot be made, correspond using Letter 45C.

    4. If the organization name contains both "Trust" and "Fund" and an individual's name, apply trust name control rules.

      Exception:

      For Forms 5227, trust name control rules apply, even if the "Fund" or "Foundation" is in the organization's name.

  2. Trust and partnership EINs beginning with 20, 26, 27, 45, 46 and 47 should follow name control rules founds in IRM 21.7.13.5.8.6.1.

Other Name Control
  1. Use the following rules to determine name control for exempt organizations other than corporations and trusts:

    1. Use the pilot voucher to determine the name control for Parent Teacher's Associations.

    2. If the return has an abbreviated first name, use the first four characters of the abbreviated name for the name control. For example:

      Name: RSVP 245
      Name Control: RSVP

    3. If the name contains the words "lodge," "local," "chapter," or "post," use the first four digits of the parent name:

      Name: Local 210, International
      Name Control: INTE

      Name: Post 3120, Veterans of Space Wars
      Name Control: VETE

    4. When an individual name and a corporate name appear, use the first four letters of the corporation name. For example:

      Name: Barbara J. Zinnia
      ZZ Grain, Inc.
      Name Control: ZZGR

    5. For churches and their subordinates, i.e., nursing homes, hospitals and schools, use the legal name of the church or subordinate as the name control. For example:

      Name: Diocese of Kansas City
      St. Ro se's Hospital
      Name Control: STRO

      Name: St. Bernard's Methodist Church Bldg. Fund
      Name Control: STBE

  2. To determine the name control for political organizations, follow the examples below:

    1. Friends of Jane Doe
      Name Control: JANE
      Input: JANE DOE FRIENDS OF

    2. Committee to Elect John Smith
      Name Control: JOHN
      Input: JOHN SMITH COMMITTEE TO ELECT

    3. Smith for State Representative
      Name Control: SMIT
      Input: SMITH FOR STATE REPRESENTATIVE

    4. Linda Jones for Congress
      Name Control: LIND
      Input LINDA JONES FOR CONGRESS

    5. Citizens for John Doe
      Name Control: JOHN
      Input: JOHN DOE CITIZENS FOR

    Note:

    These name control rules apply to 527 organizationss only. If the organization is exempt under 501, the normal rules apply.

Inputting Corporation Name, Sort Name, and Name Control

  1. Use the following to input a corporation name, sort name and name control:

    • Application for an Employer Identification Number (Form SS–4)

    • The filing of a return without an EIN

    • A return with a name change

    • Correspondence from the organization indicating a name change

Inputting Trust Name, Sort Name, and Name Control

  1. Use the following to input a trust name, sort name and name control:

    • Application for an Employer Identification Number (Form SS–4)

    • The filing of a return

    • A return with a name change

    • Correspondence requesting a name change

  2. Keep the primary name to no more than 70 characters. Abbreviate the following words or phrases, if necessary:

    Word or Phrase Abbreviation
    Trust TR
    Under agreement, UA or Under agreement UA
    Dated Jan. 16, 1987 01-16-87 (See Note)
    Trustee TTEE
    For the Benefit of, F/B/O, F B O FBO
    Non-exempt Charitable Trust NECT
    Under Trust Agreement UTA
    Voluntary Employee Benefit Association VEBA
    Charitable Remainder Annuity Trust CRAT*
    Charitable Remainder Unitrust CRUT*

    Note:

    Don’t input date, dated or the alpha month.

  3. Always make the individual trustee a sort name. Don’t sort name a bank, mortgage company or corporation. Make this type of trustee a care of name line.

  4. Use the following example for inputting a trust name:

    Return or form shows:
    Turtle Memorial Cemetery Perpetual Trust Fund
    William C Bear Trustee

    Primary Name: TURTLE MEMORIAL CEMETERY PERPETUAL
    [Continuation of Primary Name]: TRUST FUND
    Sort Name: BEAR WILLIAM C TTEE

    Note:

    When completing name and continuation lines for Forms 5227, add the bank account number (usually 8 to 10 digits) to help identify possible duplicate EIN assignment. However, it isn't necessary to update name lines with bank information each year. Don’t add numbers or characters in addition to the 8 to 10 digits bank account number.

Inputting Non-profit Organization Name, Sort Name, and Name Control

  1. Use the following to input non-profit organization names:

    • Application for an Employer Identification Number (Form SS–4)

    • The filing of a return without an EIN; e.g., Forms 990, 990-EZ, 990-T, 990-PF, 5227, 990BL, 1041-A, and 4720

    • A return with a name change

    • Correspondence requesting a name change

  2. To input the "in care of name" line when establishing the account for a non-profit organization from a Form SS-4, enter the officer's name on the in care of line, if the "care of" is blank and the signature area identifies the name of an officer of the organization.

Addresses

  1. IRM 3.13.12.6.12 gives instructions on domestic, domestic foreign, and foreign addresses.

Domestic Mailing and Location Addresses
  1. According to postal regulations, mail will be delivered to the last address immediately preceding the city, state and ZIP code. To input the mailing address, always use the P.O. Box as the mailing address if present.

    Exception:

    If the taxpayer indicates the street address is the mailing address and the P.O. Box is the location address, leave the P.O. Box as the location address. This applies to trusts and estates only.

  2. A business may have two addresses. One is the mailing address and the other is the location address or physical location of the business.

  3. If both a location address and mailing address are present:

    1. Input the location street address on the location street address line.

    2. Input the location city, state, and ZIP code on the location city/state/ZIP line.

    3. Enter a comma after both the city and state and enter the ZIP code last.

  4. To delete a location address:

    1. Use CC ENREQ/BNCHG or EOREQ/EOCHG.

    2. Input $$ in the first two positions of the location street address.

    3. Make sure the location city, state and ZIP line is blank.

  5. When changing the mailing address from a street to a Post Office (P.O.) Box number, retain the street address as a location address. The retention of the street address is necessary as an audit trail for locating organizations.

    Caution:

    If the organization is part of a GEN, don’t retain the former street address as the location address when the mailing address is changed to a P.O. Box.

  6. Don’t input the additional four (4) digits of the 12-digit ZIP code on TC 000, TC 014, and TC 019. The Finalist computer program will automatically expand the nine (9) digit ZIP code to 12 digits.

  7. The Street Address (STAD) has a maximum of 35 characters when entered. If the STAD is entered, input the city and state fields. A major city code may be used followed by two (2) commas and the zip code.

Guidelines for Domestic Mailing and Location Addresses
  1. Use the following guidelines when inputting the mailing or location street address:

    1. Don’t leave a blank space between the house or building number and an alpha suffix. For example:

      Organization submits: 1234 B North Street
      Input:1234B North St

    2. Input a house or building number when possible. If no number is present, use a building name. Otherwise, contact the organization.

    3. Always input the suite, apartment number, room number, etc. at the end of the street address line.

    4. If present, always input the street suffix; e.g., street, drive, lane, and terrace.

    5. If present, always input the street directional; e.g., North, South, East, and West.

    6. If the address contains a fraction, input as a slash (/).

    7. If the address contains a hyphen between two numbers, omit the hyphen and leave a space. For example:

      Organization submits: 289–01 Main St
      Input:289 01 Main St

      Note:

      Don’t delete the hyphen if it indicates a range or is part of an apartment number.

    8. If there are two directional in a street address, abbreviate the first directional and leave the second spelled out.

      Organization submits: North South Main St
      Input:N South Main St

      Exception:

      If the address contains NW, NE, SW, SE, don’t spell out any part of the directional.

    9. Change RFD and RD (rural delivery) to RR. Delete any leading zeros.

    10. Always enter "and" in place of the symbol "&."

    11. If the address contains a decimal, convert the decimal to a fraction. For example:

      Organization submits: 1.5 miles south of Hwy 19
      Input:1 1/2 miles south of Hwy 19

    12. If no street address or P.O. Box is provided by the organization, input the word "Local" on the street address line. This should only occur in very small towns.

    13. If the city and state are missing or incomplete and the ZIP code is present, research the ZIP Code Directory, USPS Publication 65, to determine the city and state. If the city and state cannot be determined from the ZIP Code Directory, the envelope if attached, or telephone contact, destroy the EIN application.

    14. If the ZIP code is missing, research the ZIP Code Directory, and enter the ZIP code.

    15. Optional: If the city is a major city, input the Major City Code in place of the city and state on both the mailing and location addresses. Enter the Major City Code, two commas and then the ZIP code.

    16. If location address is same as mailing address and there is a different location address on IDRS, and you are making other changes to the entity information, delete the location address on IDRS. If you are not taking any other action, do not delete the location address.

    17. If location address and mailing address are the same, and there is no location address on IDRS, do not input location address.

Domestic Street Address Abbreviations
  1. Use the following street address abbreviations when necessary:

    Word Abbreviation Word Abbreviation
    Air Force Base AFB One-fourth 1/1
    Apartment APT One-half 1/1
    Avenue AVE Parkway PKY
    Boulevard BLVD Place PL
    Building BLDG Post Office Box PO Box
    Care of % RFD RR
    Circle CIR RRD/RD RR
    Court CT Road RD
    Department DEPT Room RM
    Drive DR Route RT
    East E Rural Delivery RR
    First 1ST Rural Route RR
    Floor FLR Second 2ND
    General Delivery GEN DEL South S
    Highway HWY Southeast SE
    Highway Contract HC Southwest SW
    In care of % Street ST
    Lane LN Suite STE
    North N Terrace TER
    Northeast NE Third 3RD
    Northwest NW West W

    Exception:

    Abbreviate East, North, South and West only when it is used as a direction of a street, avenue, etc.

  2. Use the following abbreviations to limit street address fields to 35 characters:

    Word Abbreviation Word Abbreviation
    Alley ALY Forks FRKS
    Annex ANX Fort FT
    Arcade ARC Freeway FWY
    Bayou BYU Gardens GDNS
    Beach BCH Gateway GTWY
    Bend BND Glen GLN
    Bluff BLF Green GRN
    Bottom BTM Grove GRV
    Branch BR Harbor HBR
    Bridge BRG Haven HVN
    Brook BRK Heights HTS
    Burg BG Hill HL
    Bypass BYP Hills HLS
    Camp CP Hollow HOW
    Canyon CYN Inlet INLET
    Cape CP Island IS
    Causeway CSWY Islands ISS
    Center CTR Isle ISLE
    Cliffs CLFS Junction JCT
    Club CLB Key KY
    Corner COR Knolls KNLS
    Corners CORS Lake LK
    Course CRSE Lakes LKS
    Courts CTS Landing LNDG
    Cove CV Light LGT
    Creek CRK Loaf LF
    Crescent CRES Locks LCKS
    Crossing XING Lodge LDG
    Dale DL Loop LOOP
    Dam DM Mall MALL
    Divide DV Manor MNR
    Estates EST Meadows MDWS
    Expressway EXPY Mill ML
    Extension EXT Mills MLS
    Fall FALL Mission MSN
    Ferry FRY Mount MT
    Field FLD Mountain MTN
    Fields FLDS Neck NCK
    Flats FLT Orchard ORCH
    Ford FRD Oval OVAL
    Forest FRST Park PARK
    Forge FRG Pass PASS
    Fork FRK Path PATH
    Place PL Station STA
    Pike PIKE Stravenue STRA
    Pines PNES Stream STRM
    Place PL Summit SMT
    Plain PLN Trace TRCE
    Plains PLNS Track TRAK
    Plaza PLZ Trail TRL
    Point PT Trailer TRLR
    Port PRT Tunnel TUNL
    Prairie PR Turnpike TPKE
    Radial RADL Union UN
    Ranch RNCH Valley VLY
    Rapids RPDS Viaduct VIA
    Rest RST View VW
    Ridge RDG Village VLG
    River RIV Ville VL
    Row ROW Vista VIS
    Run RUN Walk WALK
    Shoal SHL Way WAY
    Spring SPG Wells WLS
    Springs SPGS
    Spur SPUR
    Square SQ
Domestic Foreign Addresses (APO, FPO, AA, AE, AP, MP, PR, GU, AS, FM, MH, PW and VI)
  1. Use the following state codes in place of the city and state for CC ENREQ/BNCHG and EOREQ/EOCHG:

    Country State Code Zip Code
    Americas AA 340XX
    Europe AE 09XXX–098XX
    Pacific AP 962XX–966XX
    Examples:
    PVT Daisy Flower Jean Rose, PPC (SW), USN
    Company F, PSC Box 100 USS Oak
    167 Infantry Regt FPO, AP 96667
    APO, AE 09801
    Always use APO or FPO in the address.
  2. Use the following State and ZIP codes for territories and possessions:

    Country State Code Zip Code
    Virgin Islands VI 008nn
    Puerto Rico PR 006nn, 007nn, 009nn
    Guam GU 969nn
    American Samoa AS 96799
    Northern Mariana Islands MP 969nn
    Federated States Micronesia FM 969nn
    Marshall Islands MH 959nn
    Palau PW 969nn
  3. Research in a geographical dictionary if the name of the foreign country isn't present and cannot be determined.

Foreign Mailing and Location Addresses (other than APO, FPO, AA, AE, AP, MP, FM, MH, PW, PR, GU, AS, and VI)
  1. Since ISRP isn't able to input foreign addresses, a copy of the first page of a return will be received with a complete address in Entity from Code & Edit to input the foreign address.

  2. Use the following guidelines to enter foreign addresses:

    1. Don’t abbreviate the country. Input the country in the city field of the mailing city/state/ZIP line.

    2. Input the state field as a comma (,) and a period (.).

    3. Leave the ZIP code field blank.

    4. Always enter the foreign street address and mailing street address when the state codes is "," .

    5. To delete a foreign street address, input $$ in the first two positions of the foreign street address.

      Note:

      When an organization indicates an address change and the change is to a foreign address, retain the street address as an audit trail for locating organizations.

  3. To input a foreign address as a location address:

    1. Always input the location street address.

    2. Enter at least 3 alpha characters for the location city field. Don’t use major city codes. A comma must be entered after the location city field.

    3. Input the foreign country in the location state field. It must be at least 3 alpha characters followed by a comma "," .

    4. Input a period"." in the location ZIP field.

  4. To delete a foreign address as a location address:

    1. Input $$ in the first two positions of the location street address.

    2. Don’t input the location city, state, and ZIP.

Inputting Foreign Addresses
  1. If a foreign address is entered, enter the mailing street or foreign city/postal code and mailing city or foreign country/state/ZIP fields. Enter as follows:

    • Input TC 014.

    • Enter the new street address in the "Foreign Address" field (FA),

    • the city and identifying data in the "Mailing Street or Foreign City/Postal Code" field,

    • the country in the "Mailing City or Foreign Country" field and

    • a period (.) in the "State" field.

  2. When inputting the Foreign Address (FA) with CC EOREQ/EOCHG, Document Code 80:

    1. If the account has a foreign address, always enter this field.

    2. If no street address is present, enter "local."

    3. Input the American possessions of American Samoa, Mariana Islands, Marshall Islands, Puerto Rico, Virgin Islands and Guam as domestic addresses.

    4. Use TC 000, 013, 014, or 016 if Document Code is 80.

    5. To delete the FA, enter $$.

Subsection Code and Classification Codes

  1. The table below includes a complete listing of EO Subsection and Classification Codes:

    SS Code Class. Code Type of EO 1986 IR Code 1939 IR Code
    01 1 Government instrumentality 501(c)(1) 101(15)
    02 1 Title holding company 501(c)(2) 101(14)
    03 1 Charitable corporation 501(c)(3) 101(6)
    03 2 Educational organization 501(c)(3) 101(6)
    03 3 Literary organization 501(c)(3) 101(6)
    03 4 Org to prevent cruelty to animals 501(c)(3) 101(6)
    03 5 Org to prevent cruelty to children 501(c)(3) 101(6)
    03 6 Org for public safety testing 501(c)(3) 101(6)
    03 7 Religious organization 501(c)(3) 101(6)
    03 8 Scientific organization 501(c)(3) 101(6)
    04 1 Civic league 501(c)(4) 101(8)
    04 2 Local association of employees 501(c)(4) 101(8)
    04 3 Social welfare organization 501(c)(4) 101(8)
    05 1 Agricultural organization 501(c)(5) 101(1)
    05 2 Horticultural organization 501(c)(5) 101(1)
    05 3 Labor organization 501(c)(5) 101(1)
    06 1 Board of trade 501(c)(6) 101(7)
    06 2 Business league 501(c)(6) 101(7)
    06 3 Chamber of commerce 501(c)(6) 101(7)
    06 4 Real estate board 501(c)(6) 101(7)
    07 1 Pleasure, recreational or social clubs 501(c)(7) 101(9)
    08 1 Fraternal beneficiary, society or association 501(c)(8) 101(3)
    09 1 Voluntary employees beneficiary assoc-Non- government 501(c)(9) 101(16) & (19)
    09 2 Voluntary employees beneficiary assoc- government 501(c)(9) 101(16) & (19)
    10 1 Domestic fraternal societies and associations 501(c)(10) N/A
    11 1 Teachers retirement fund association 501(c)(11) 101(17)
    12 1 Benevolent life insurance association 501(c)(12) 101(100)
    12 2 Mutual ditch or irrigation company 501(c)(12) 101(100)
    12 3 Mutual or cooperative telephone company 501(c)(12) 101(100)
    12 4 Organization like those on three preceding lines 501(c)(12) 101(100)
    13 1 Burial association 501(c)(13) 101(5)
    13 2 Cemetery company 501(c)(13) 101(5)
    14 1 Credit union 501(c)(14) 101(4)
    14 2 Other mutual corporation or association 501(c)(14) 101(4)
    15 1 Mutual insur co or assoc other than life/marine 501(c)(15) 101(11)
    16 1 Corporation financing crop operation 501(c)(16) 101(13)
    17 1 Supplemental unemployment comp. trust or plan 501(c)(17) NA
    18 1 Empl funded pension trust created before 6-25-59 501(c)(18) NA
    19 1 Post or organization of war veterans 501(c)(19) NA
    20 1 Legal service 501(c)(20) NA
    21 1 Black lung benefit trust 501(c)(21) NA
    22 1 Multiemployer pension plan 501(c)(22) NA
    23 1 Veterans association founded prior to 1880 501(c)(23) NA
    24 1 Trust described in Section 4049 or ERISA 501(c)(24) NA
    25 1 Title-holding company for pensions etc 501(c)(25) NA
    26 1 State sponsored high risk health ins. org 501(c)(26) NA
    27 1 State sponsored workers compensation reinsurance 501(c)(27) NA
    28 1 National Railroad Retirement Investment Trust 501(c)(28) NA
    29 1 State Health Care Insurance 501(c)(29) NA
    40 1 Apostolic and religious organization 501(d) 101(18)
    50 1 Cooperative hospital service organization 501(e) NA
    60 1 Coop service orgs of operating education orgs 501(f) NA
    70 1 Child care center 501(k) NA
    71 1 Charitable risk pool 501(n) NA
    80 1 Farmers Cooperative 521 NA
    81 1 Qualified state sponsored tuition program 529 NA
    82 1 Political Organizations 527 NA
    90 1 Nonexempt charitable trust 4947(a)(2) (split interest) 4947(a)(2) NA
    91 1 Nonexempt charitable trust (public charity) 4947(a)(1) NA
    92 1 Nonexempt charitable trust (treated as Pvt. Fdn.) 4947(a)(1) NA
    93 1 Taxable farmers cooperative 1381(a)(2) NA
  2. When inputting the Subsection Code (SS) with CC EOREQ/EOCHG and either Document Code 80 or 81:

    1. Use TC 000, 012, or 016 if Document Code is 80.

    2. Use TC 016 if Document Code is 81.

  3. If the Doc. Code is 81, input the following items:

    1. SS must be 01-20, 23, or 70.

    2. Definer Code must be A or D.

    3. If SS is 03, then Type of Foundation must be 09-18.

    4. Enter the classification code.

  4. If the Document Code is 80, perform the following validity and consistency checks:

    1. SS must be 01, 02, 04-25, 40, 50, 60, 70-71, 81-82, 90-93.

    2. If the SS is 03 and Status isn't 70-72, input the Type of Foundation as 02, 03, 04, or 09–18.

    3. If the SS entered is other than 03 and the previous subsection was 03, enter 99 in the type of foundation field.

    4. If the SS is 03 and the Status is 70-72, don’t enter the type of foundation.

    5. If the SS is 82 and the Status is 34, don’t enter the type of foundation.

    6. Enter the classification code.

    7. If the TC is 012 or 016, enter Definer Code A.

  5. Subsection validity checks are also dependent on filing requirements and status codes. IRM 3.13.12.6.33 and IRM 3.13.12.6.18 for status codes.

  6. If an erroneous subsection is on the BMF, delete with TC 022.

Foundation Code

  1. When inputting the Foundation Code (TF) with CC EOREQ/EOCHG and either Document Code 80 or 81:

    1. If the Document Code is 80, the TC may be 000, 012 or 016.

    2. If the Document Code is 81, the TC must be 016.

    3. If the Subsection Code input is 03 and the Status isn't 70-72, the TF must be input.

    4. If the SS input is 03 and the Status is 70-72, the TF should not be input.

    5. If the SS input is 82 and the Status is 34, the TF should not be input.

    6. If there is a Form 990-PF FR, the TF must be 02, 03 or 04.

      Note:

      TF of 02 is input by Cincinnati; however, for UPC 355 it may be input by the campus. Be very sure the TF of 02 is correct before inputting it, as it exempts the organization from paying taxes on a Form 990-PF. See UPC 355 instructions in IRM 3.12.278.

    7. If there is a Form 990 FR of 01 and SS is 03, Type of Foundation must be 09-18.

      Note:

      TF 09 is never valid, but it does allow the posting of Forms 990 and 990-PF under special circumstances.

    8. If there is a Form 990 FR of 06, the Foundation Code must be 10.

    9. To delete a foundation code, input 99.

  2. The following table is a list of foundation codes and descriptions:

    Foundation Codes Description
    00 4947(a)(1)
    02 Private Operating Foundation with an election under 4940(d)(2)
    03 Private Operating Foundation
    04 Private Non-Operating Foundation
    09 Suspense (a specific type not identified)
    10 Church - IRC 170(b)(1)(A)(i)
    11 School - IRC 170(b)(1)(A)(ii)
    12 Hospital - IRC 170(b)(1)(A)(iii)
    13 Organizations operated for the benefit of a College or University - IRC 170(b)(1)(A)(iv)
    14 Federal, State or Local Government unit (IRC 170(b)(1)(A)(v)
    15 Organization receiving support from governmental unit or general public (Section 170(b)(1)(A)(vi)
    16 General - Public Charity IRC 509(a)(2)
    17 Public Charity supporting (FC 09-15) (IRC 509(a)(3).
    18 Public Safety (IRC 509(a)(4)
    21 Supporting organization - IRC 509(a)(3) - Type I
    22 Supporting organization - IRC 509(a)(3) - Type II
    23 Supporting organization - IRC 509(a)(3) - Type III functionally integrated.
    24 Supporting organization - IRC 509(a)(3) - Type III not functionally integrated.
    25 Agriculture Research Organization

Classification Code

  1. When inputting the Classification Code (CL) with CC EOREQ/EOCHG and either Document Code 80 or 81:

    1. If Document Code is 80, the TC must be 000, 012 or 016.

    2. If Document Code is 81, TC must be 016.

    3. Valid CLs are 1, 2, 3, 4, 5, 6, 7, or 8.

    4. A maximum of 2 classification codes may be entered beginning with the left-most position. If minimum of one CL is used, don’t enter zeros in the remaining positions.

    5. If Doc. Code is 80 and CL is 1, the Subsection Code must be 01-25, 40, 50, 60, 70-71, 80-82 or 90–93.

    6. If the CL is 2, the SS must be 03-06, 09 or 12-14.

    7. If the CL is 3 or 4, the SS must be 03-06 or 12.

    8. If the CL is 5-8, the SS must be 03.

    9. If Doc. Code is 81 and CL is 1, SS must be 01-20, 23 or 70.

    10. Subsection code must be input.

Affiliation Code

  1. These instructions for inputting the Affiliation Code (AF) with CC EOREQ/EOCHG apply to either Document Code 80 or 81.

  2. TC 000 - Document Code 80 - AF 1, 2, or 3:

    1. Status Code must be 01, 12, or 70 -72.

    2. Don’t input New GEN.

  3. Required fields for TC 016 - Document Code 80 - AF 1, 2, or 3:

    1. Definer Code C must be input.

    2. If New GEN is input, it must be 9999.

    3. If New GEN is input, From GEN must be input.

  4. TC 000 - Document Code 80 - AF 6, 7, 8, or 9

    1. Status Code must be 01.

    2. New GEN must be present.

    3. Valid range for New GEN is 0002–9998.

  5. TC 016 - Document Code 80 - AF 6, 7, 8, or 9

    1. Definer Code must be C or F.

      If Then
      Definer Code is C, Either New GEN or From GEN or both must be present.
      From GEN is input, It must match the GEN on the BMF.
      New GEN is input, Valid range is 0002–9998.
    2. If the parent affiliation code was established incorrectly on the BMF, use Definer Code C to make the change. IRM 3.13.12.6.3.3 for Definer Code C instructions.

      Example:

      BMF shows an "8" church, but it should be a "6" .

  6. TC 016 - Document Code 81 - AF 7 or 9

    1. Definer Code C or D must be input.

    2. From GEN must be input using the range from 0002 - 9998.

  7. The table below shows a list of affiliation codes and descriptions:

    Affiliation Code Description
    1 Central Organization (Individual Ruling)
    2 Intermediate Organization (Individual Ruling)
    3 Independent Organization (Individual Ruling)
    6 Parent of a group ruling (not a church)
    7 Intermediate parent (subordinate by state)
    8 Parent of a church
    9 Subordinate of a group ruling (also, group return)

Type of Organization

  1. These instructions for inputting the Type of Organization Code (TO) with CC EOREQ/EOCHG apply to either Document Code 80 or 81.

    1. If Doc. Code is 80, the TC may be 000 or 016.

    2. If TC 000 and Doc. Code is 80, the SS must be input.

    3. The TO and Subsection Code must be as follows:

    If Then
    TO is 1 (Corporation), SS must be 01-16, 19-20, 23, 25, 40, 50, 60, 70 or 80.
    TO is 2 (Trust), SS must be 03-15, 17-22, 24, 25, 50, 60 or 90.
    TO is 3 (Cooperative), SS must be 03, 50, 80 or 93.
    TO is 4 (Partnership), SS must be 40.
    TO is 5 (Association), SS must be 01-21, 23, 40, 50, 60 or 70.
    TO is 6 (NECT), SS must be 91 or 92.
  2. If the Document Code is 81, TC must be 016 and the following items must be present:

    1. Definer Code must be a D.

    2. TO must equal 5.

  3. The table below shows the Type of Organization and the descriptions:

    Type of Organization Description
    1 Corporation
    2 Trust
    3 Cooperative
    4 Partnership
    5 Association
    6 Non-Exempt Charitable Trust (NECT)

EO Status Code and Year

  1. IRM 3.13.12.6.18 covers EO Status Codes 01, 02, 06, 07, 10-12, 18-26, 28-36, 40-42, 70-72, and 97-99.

  2. The instructions for inputting the Status Code and Year (ST) with CC EOREQ/EOCHG apply to both Document Code 80 or 81.

    1. Input the status code as 2 digits and the year as YYYYMM.

    2. If the Doc. Code is 80, the TC may be 000, 012, or 016.

    3. If the Doc. Code is 81, the TC must be 016.

  3. If the Document Code is 81, input the following items:

    1. Definer Code must be B or D

    2. Status Code must be 01, 20, 22, 26 or 29

      Note:

      Status 29 should not be used by the campus.

  4. If the TC is 000 and the Document Code is 80, the following validity and consistency checks are performed:

    If Then
    ST is 01, SS must be 01, 25, 40, 50, 60, 70, or 80.
    ST is 06 or 07, No SS is input and FRC is Form 990-T of 01 and Form 990 of 06.
    ST is 10 or 11, No SS is input and FRC is Form 990 of 06.
    ST is 12 and SS is 90, FRC must be Form 5227 of 1 or 2.
    ST is 12 and SS is 91, FRC must be Form 990 of 01 or 02.
    ST is 12 and SS is 93, FRC must be Form 990-C/1120-C of 20.
    ST is 30-33, No SS or FRC is input.
    ST is 12 and SS is 92, FRC must be Form 990-PF of 1.
    ST is 34 and SS is 82, FRC must be Form 990.
    ST is 40, No SS is input and FRC must be NR of 1.
  5. If the TC is 012 and the Document Code is 80, the following validity and consistency checks are performed:

    If Then
    ST is 01, SS must be 01-25, 40, 50, 60, 70, or 80.
    ST is 06, 07, 10, 11 or 40, SS must be 99 or not input.
    ST is 12, SS must be 90-93.
    ST is 18, SS must be 92.
    ST is 19, SS must be 03 and the TF must be 02, 03, or 04.
  6. For Document Code 80, the ST may be 01, 06, 07, 10-12, 18-20, 22-26, 27, 28, 30-34, 40-42, or 70-72, and the following validity and consistency checks are performed:

    If Then
    ST is 18, SS must be 92.
    ST is 41, 70-72, At least one FRC of Forms 1041, 1065 or 1120 must be input and the FRC for Forms 990, 990-T, 5227, or 990-PF must be zero if input.
    ST is 34, SS must be 82.
  7. Status is 27, the following consistency checks are performed:

    1. The fields which are input are name control, EIN, From GEN, To GEN = 9999, definer code, status 17 and date, filing requirements 990-01 or 990-02 and remarks.

    2. Definer codes are ABC.

    3. Status code date entered as current month and year (YYYYMM).

    4. Transaction Code must be 016.

    5. Document Code must be 80.

    6. Remarks must be input.

  8. If Status is 28, the following validity and consistency checks are performed:

    1. The only fields which can be input are name control, EIN of subordinate being placed in Status 28, From GEN, definer code, status code and date, transaction code, document code and remarks.

    2. Definer Code must be B.

    3. Status code date entered as current month and year (YYYYMM).

    4. Transaction Code must be 016.

    5. Document Code must be 80.

    6. Remarks must be input.

EO Status Code Date
  1. Update the EO Status Code Date as follows:

    1. When putting an account in , use the effective date on EDS.

    2. When putting an account in EO Status Codes 06-07, 10-12, 20-21, 26, 28-29, 30-31, 33-36, and 40-42, use the current date.

    3. When adding a new subordinate from the pilot voucher (either when working a new GEN or an SGRI), use the current date.

    4. When putting an account back in after the account was in an inactive EO Status Code like 20-21, 28 or 29, use the ruling date as the status code date.

EO Status Codes
  1. The following table displays the EO Status Codes and their definitions:

    Status Code Definition
    01 Unconditional Exemption
    02 Conditional Exemption
    06 State University filing Form 990-T
    07 Church Filing a Form 990-T
    11 School Certification
    12 A Formal Exemption Not Granted- Filing an EO Return
    Form 990 Under IRC 4947(a)(1)
    Form 990-PF Under IRC 4947(a)(1)
    Form 5227 4947(a)(2) Trust
    Form 1120-C Taxable Farmer's Cooperative
    18 Temporary Revocation of Private Foundation (Trust) (Required to file Forms 990-PF & 1041)
    19 Revocation of Private Foundation (Required to file Forms 990-PF & 1120)
    20 Termination-Inactive (out of business etc.)
    21 Unable to locate - (new address needed)
    22 Revocation (required to file Form 1120)
    23 507(a) Termination
    24 507(b)(1)(A) Termination
    25 507(b)(1)(B) Termination
    26 Termination Merger
    28 No longer a member of a Group Ruling
    29 A Group Ruling was dissolved
    30 Churches who voluntarily file F990
    31 Small organizations other than private foundations
    32 (Obsolete 1/2008) Non-responders to CP 140/144 (CP 140/144 obsolete 1/2008)
    33 Foreign Private Foundation - No Exemption- Required 4% Tax on Investment Income
    34 527 Political Organization
    35 Foreign Entities Exempt by Treaty with U.S.
    36 Non IRC 501(c)(3), (9) or (17) organization - no exemption
    40 Return Filed - No Record of Exemption
    41 No reply to solicitation - no exemption
    42 Extension filed/posting payments to 1st EO return - no exemption Obsolete September 2011.
    70 Denied - inactive - no exemption
    71 Incomplete Form 1023/1024 - no exemption
    72 Refusal to rule - no exemption
    97 Revocation of tax exempt status - no TC 150 filed for three consecutive years
    98 Terrorist organization - no exemption
    99 Dump code - no exemption
EO Status Code 01
  1. When an organization is granted an exemption, Cincinnati EO Determinations or NO SE:T:EO will input the information on the BMF to create the EO account, or add the exemption data to an already existing account. When Status Codes 01 or 02 are present on the BMF/EO account, they indicate an exemption was granted to the organization. IRC 501(c)(3), 501(c)(9), 501(c)(17), 501(c)(20), and 501(c)(29) organizations are required to notify the Service they are seeking tax-exempt status; therefore, they must file a Form 1023 or 1024 as applicable with EO Determinations.

    Exception:

    Churches, conventions of churches, integrated auxiliaries of churches, and public charities with average annual gross receipts of less than $5,000 are not required to apply for tax-exempt status.

    Note:

    IRC 501(c) organizations other than IRC 501(c)(3), IRC 501(c)(9), IRC 501(c)(17), IRC 501(c)(20) and IRC 501(c)(29) organizations are not required to file an application for exemption, though they may do so. They are considered exempt even though they don’t apply for exemption as long as they are filing the required annual information return.

    Note:

    Beginning January 2004 a Form 990-T or a payment for a Form 990-T will automatically post to an account in EO Status 01-02 if the name control and EIN on the return or payment match the name control and EIN on Master File. A Form 990-T filing requirement will be added to the module.

  2. Status Code 01 can be input by Entity Control from a pilot voucher for a group exemption or from research of EDS.

  3. If Forms 990, 990-T or 5578 are received with a GEN, or you know they are a subordinate of a group ruling, use the pilot voucher to create the EO section on the BMF and to add the subordinate to the GEN File.

    Note:

    Check the SGRI to ensure the subordinate was not removed from the group ruling before creating the EO section. If the SGRI indicates the subordinate was removed but this is a final 990 or 990-T use the pilot voucher to create the EO section. If this isn't the final 990 or 990-T, place the account in Status 40.

  4. If research of EDS on first screen indicates status 01, 06 or 09, update the BMF for the EO section, using the procedures beginning in IRM 3.13.12.9.

    Caution:

    If the status code on EDS is other than 01, 06 or 09, don’t update the EO Status Code to 01.

  5. If the entity is an Non-Integrated Auxiliary (NIA), the Form 990 FRC should be 01, with SS 03 and Type of Foundation Code 10. Research CC ENMOD to see if the account is on the BMF.

    If Then
    The account is on the BMF, Add the EO section with CC EOREQ/CC EOCHG, Doc. Code 80, TC 016, Definer Codes ABC and add the EO data from the pilot voucher (Form 2363A). The following fields must be added from the Form 2363A: subsection, foundation code (if applicable), classification code, affiliation code, type of organization, status code and date, ruling date, deductibility code and year, new GEN, pension plan, employment code, FYM, NTEE, NAICS code and filing requirements.
    The account isn't on the BMF, Add the account to the BMF. Use CCs EOREQ/EOCHG with Doc. Code 80, TC 000 and use the pilot voucher or EDS as the source information to update the BMF.
    The ruling date is available, Use the ruling date when returning the EO Status to 01.
EO Status Code 06
  1. Use Status Code 06 to create an EO section on the BMF for an account which is a state operated university or college, government entity or a Re-insurance company required to file Form 990-T for unrelated business income.

    Note:

    To identify a Re-insurance company check the top of Form 990-T for the words "Re-insurance Company" or similar wording. If unable to determine whether the 990-T is filing for a re-insurance company, put the account in the appropriate status code.

  2. When a Form 990-T is received for this type of entity and research shows it doesn't have an exemption, use EO Status 06 to add an EO section to the EIN on the BMF.

  3. Input this status code with a TC 012 or 016 using CC EOREQ/CC EOCHG. If a return is received without an EIN and research doesn't locate an EIN, assign an EIN.

  4. The following items must be present for EO Status 06:

    • Doc. Code 80

    • TC 012 or 016

    • Definer Codes - AB

    • STS-CD/DT - 06YYYYMM

    • FYM

    • Filing Requirements 990-T - 1

    • REMARKS

EO Status Code 07
  1. When the EO section isn't on the BMF, use Status Code 07 to create an EO section for an account which is a church filing Form 990-T.

  2. When a Form 990-T for a church is received and research doesn't reveal an exemption, use Status Code 07.

  3. Never use this status code under the following conditions:

    1. The GEN is shown in item F on the return. In these cases, use the pilot voucher.

    2. 401(a) trust is checked on the return or the name contains words such as "Pensions," "Retirement," "Welfare," or " Profit Sharing Plans." IRM 3.13.12.9.13.4 for information on IRC 401(a) and IRC 408 IRA Trusts filing Form 990-T.

    3. The organization name doesn't clearly indicate a church, or you are in doubt whether the organization is a church. In these cases, use Status Code 40.

  4. Add the EO section to the BMF with CCs EOREQ/EOCHG. The items shown below must be present when processing a TC 016.

    • Doc. Code 80

    • TC 016

    • Definer Codes - AB

    • STS-CD/DT - 07YYYYMM

    • FYM

    • Filing Requirements 990-06 and 990-T - 1

    • REMARKS

    If Then
    The account isn't on the BMF, Use CCENREQ/CC BNCHG with Doc. Code 63 and TC 000.
    The account is on the BMF, Use CC EOREQ/CC EOCHG with Doc. Cod 80, TC 016 and Definer Codes AB.
EO Status Code 10
  1. Use Status Code 10 to create an EO section for a church which was examined by the EO Area Office in Dallas.

  2. The Form 990 which will be received will be prepared by the EO Area Office Examination. It will be a dummy return, input to create a tax module on the BMF to allow the examination closing record to post.

  3. Add the EO section to the BMF through IDRS with CC EOREQ/CC EOCHG.

    If Then
    The account isn't on the BMF, Use CC ENREQ/CC BNCHG with Doc. Code 63 and TC 000.
    The account is on the BMF, Use CC EOREQ/CC EOCHG with Doc. Code 80, TC 016 and Definer Codes A and B. The items shown below must be present.
    • Doc. Code 80

    • TC 016

    • Definer Codes - AB

    • STS-CD/DT - 10YYYYMM

    • FYM

    • Filing Requirements 990-06

    • REMARKS

EO Status Code 11
  1. Use Status Code 11 to create an EO section for a church-controlled school if an EO section isn't already on the BMF.

  2. Form 5578 is filed by organizations exempt, or claiming to be exempt, from Federal Income Tax under IRC 501(c)(3) which operate, supervise or control a private school (or schools), and which are not required to file Form 990.

  3. When research doesn't reveal an exemption, use Status 11 to create the EO section of the BMF. Exception: If the school is self-controlled, create the EO section using Status 40.

  4. Add the EO section to the BMF through IDRS with CCs EOREQ/EOCHG.

EO Status Code 12
  1. Use Status Code 12 to create an EO section for returns filed under IRC 4947(a)(1) or 4947(a)(2) or Taxable Farmer's Cooperatives when the EO section isn't on the BMF.

  2. If Forms 990 or 990-PF under IRC 4947(a)(1), 990-C/1120-C or 5227 are received and research doesn't reveal an exemption, use Status Code 12.

    Note:

    Use Status Code 12 for a Form 990 filer if EDS shows a 1071 Letter was sent to the organization.

  3. Add the EO section to the BMF through IDRS with CC EOREQ/CC EOCHG.

    1. If the account isn't on the BMF, use CC ENREQ/CC BNCHG with Doc. Code 63 and TC 000.

    2. The items shown below must be present for processing TC 000.
      Doc. Code 63
      TC 000
      Name Control
      Primary Name
      Street Address
      City, State, ZIP
      REMARKS

    3. The items shown below must be present for processing TC 016.
      Doc Code 80
      Definer Codes – AB
      Subsection Code
      Classification Code
      STS-CD/DT – 12YYYYDD
      FYM
      Filing Requirements
      REMARKS

    4. For updating EO Status to 12, use the following table:

      Forms Received Type of Filer Subsection Code
      5227 4947(a)(2) 90
      990 4947(a)(1) 91
      990-PF 4947(a)(1) 92
      990-C/1120-C Taxable Farmer's Co-Op 80/93
  4. If the account on the BMF is without an EO section or with an incorrect EO section due to a Form 5227 or Form 1120 FRC, use CC EOREQ/CC EOCHG with Doc. Code 80, TC 016 and Definer Codes AB. To correct, do the following:

    1. Use the applicable subsection codes as shown above.

    2. For Forms 5227, check line F.

      If Then
      Line F indicates the trust has unrelated business income, Use FRC 2. Research BMF to ensure a Form 1041 FRC is present, adding if necessary.
      Line F indicates the trust has no unrelated business income, Use FRC 1. Research BMF and delete any Form 1041 FRC, if present.
    3. For Forms 990 and 990-PF:

      If Then
      The BMF has an EO section for Form 5227, Delete the Form 5227 FRC on the same input as adding the Forms 990 or 990-PF FRC. Always enter ST 12 and use the current date.
      A Form 1041-A FRC is also present on the BMF, You must input a TC 591, Closing Code 020, to the tax period of the latest posted MFT 36 tax module.
    4. For Forms 990-C, always delete the 1120 FRC. If Form 1120C is received, 1120 FRC should be changed to 1120-20.

    5. For Doc. Code 80, TC 016 input use Definer Codes AB, Subsection Code, Status Code/Date 12YYYYMM, FYM, filing requirements and remarks.

EO Status Codes 18 and 19
  1. Status Codes 18 and 19 are input by Cincinnati when a private foundation exemption is revoked. The organization is required to continue filing the Form 990-PF return.

  2. Status 18 is used when the organization is a trust. Cincinnati will change the Type of Organization to a 6 and the Subsection Code to a 92. The type of foundation code will be deleted by the BMF. The organization will be required to file both a Form 990-PF and a Form 1041.

  3. Status Code 19 is used when the organization is a corporation. The organization will be required to file both a Form 990-PF and a Form 1120.

EO Status Code 20
  1. Status Code 20 ("Terminated/Out of Business" ) is used when the organization with an individual ruling is terminated or out of business. The filing requirement for all EO returns will be updated to zero automatically.

    1. This status can be input by the campus when correspondence from the organization contains statements such as "out of business" , "no longer in operation" , or "terminated" .

      Note:

      Status 20 is only used for organizations with individual rulings. If the organization is a subordinate of a group and the parent indicates it is no longer part of the group, the subordinate is put into Status 36 or 40 depending on the subsection.

    2. Input this status with a Doc. Code 80, TC 016 and Definer Code B. and the current date is input for the status date (YYYYMM). Destroy per local procedures.

    3. If the organization has an IRC 501(c)(3) exemption with end of year assets greater than $100,000 (see Line 20 Part l on Form 990, Line 21 Part l on Form 990-EZ, Line 6 Part lll on Form 990-PF), don’t input Status 20.

    4. When the organization responds to a delinquency notice with statements such as "out of business" , "no longer in operation" , "terminated," etc., a TC 591 cc 020 will be input. When this transaction posts to the tax module which is a primary return, the EO Entity Status will be updated to 20 with the date the TC 591 posted.

      Exception:

      If the BMF shows the account to be a subordinate of a group ruling; i.e., a GEN is present and the AF is 7 or 9, the update will be to a Status Code 28.

    5. When a final return is filed and Computer Condition Code F is input, the EO Entity Status is automatically updated to 20.

      Exception:

      If the BMF shows the account to be a subordinate of group ruling; i.e., a GEN is present and the AF is 7 or 9, the update will be to a Status Code 28.

  2. If an account is erroneously placed into Status 20, check to see if there is a date in the DBC field on ENMOD. If a date is present, the date must be zeroed out prior to updating the account to a good status. To zero out the field, input eight "9" s in the DT-BUS-CLD field using ENREQ/BNCHG.

EO Status Code 21
  1. Status Code 21 ("Unable to locate " ) is used when we are unable to locate the organization. Status Code 21 is generated by the input of CC FRM49 with a TC 593 cc 082. The posting of the TC 593 cc 082 removes all EO filing requirements.

  2. When working an unpostable return which requires the updating of the EO Status Code from 21 to 01:

    1. Check EDS for a "T" case. If a "T" case is found, update the Status Code to 40. Notify the organization they have terminated and must apply for a formal exemption.

    2. If no "T" case is found, update the EO Status to 01 and post the return. Research CC BMFOLI to determine for what years the organization did not file a return and input a TC 474 to create a tax liability for those years.

    3. Update the filing requirements as follows:

    • If the return indicates gross receipts greater than $50,000, update the 990 filing requirements to 990-01.

    • If the return indicates gross receipts less than or equal to $50,000, update the 990 filing requirements to 990-02.

    • If there is no indication or you are unable to determine the gross receipts, update the 990 filing requirements to 990-02.

EO Status Code 22
  1. Status Code 22 ("Revocation" ) is used when the organization's exemption is revoked following review of the organization's account. This status will generate a Form 1120 filing requirement. If the Form 1120 FR is missing, add it to the account.

    Note:

    An organization in EO Status 22 cannot become a member of a group ruling without receiving an individual ruling first.

  2. If the organization files a Form 990-PF but there is a Form 1120 FR, change the status to 01 to post the Form 990-PF, return the account to its previous status after the return has posted. If the organization files a Form 990 but there is a Form 1120 FR, have the Lead determine the disposition of the return.

EO Status Codes 23 and 24
  1. Status Code 23 ("Termination Under 507(a)" ) is used when the organization is terminated under 507(a). The filing requirements of all EO returns will be updated to a zero, except Form 990-PF which will not change.

  2. Status Code 24 ("Termination Under 507(b)(1)(A)" ) is used when the organization is terminated under 507(b)(1)(A). The filing requirement for all EO returns will be updated to zero, except Form 990-PF which will not change.

EO Status Code 25
  1. Status 25 Background Information

    1. Status 25 represents private foundations which have received an advance ruling letter from Cincinnati indicating they are terminating under 507(b)(1)(B), also known as a 60-month termination. Cincinnati will update the EO Status to 25 and input an Advance Ruling Date using Form 2363A. There will be a TC 016 with Cincinnati's DO code on CC BMFOLE to indicate the EO status was changed and advance ruling date input.

    2. These organizations will continue to file a Form 990-PF for 5 years, but may elect not to pay tax on net investment income. If they elect not to pay tax, a Form 872B (Consent to Extend the Time to Assess Miscellaneous Excise Taxes) must be attached to the Form 990-PF when filed. The interest on the tax should continue to accumulate in this case, but the organization should not receive notices or penalties. At the end of the 5 years, the organization must show it meets one of the three public support tests under IRC 509(a) (1) and (2) of the Code.

    3. If they do meet the public support test, Cincinnati will issue a new determination letter, update the EO Status to 01, change the FR to Form 990 and remove the advance ruling date. If the organization did not choose to pay their excise tax, they will not owe the interest which has accumulated. If the organization chose to pay the tax during the 60-month termination, they may apply for a refund.

    4. If the organization doesn't meet the public support test, Cincinnati will remove the advance ruling date, update the EO Status to 01 and the filing requirement will remain a Form 990-PF. If the organization did not pay any excise tax during the 60-month termination, the organization will owe back taxes plus interest.

    5. In the last year of the 60-month termination, the organization may file a Form 990 if they provide the necessary information to Cincinnati as stated in the Form 990-PF instructions and Cincinnati determines they meet the public support test and issues them a new determination letter. Process as follows:

      If Then
      The organization files a Form 990 for the final year of their termination period:
      1. Research EDS to determine if they were approved as a public charity.

      2. If they were approved, update the BMF with a TC 016 Doc. Code 80 Definer Codes AB.

      3. If they have not been approved, correspond with the organization indicating they are required to supply Cincinnati with the necessary information to determine if they are a public charity before they can file a Form 990. Also indicate if they have supplied the necessary information to Cincinnati to please send a copy along with their response. If they did not supply Cincinnati with the necessary information, they are required to file a Form 990-PF for the last year of their termination period.

      The organization responds with a copy of the information supplied to Cincinnati,
      1. Contact Cincinnati asking for a determination of the organization's public charity status.

      2. If Cincinnati indicates the organization is a public charity, update the BMF with a Form 990 filing requirement and EO Status of 01 with a TC 016 Doc. Code 80 Definer Codes AB.

      The organization responds with a completed Form 990-PF:
      1. Attach the Form 990 to back of the Form 990-PF and send the Form 990-PF through for processing.

      .
  2. If a Form 990-PF with the 60 - month termination box checked is received from Code & Edit, research EDS to determine if an Advance Ruling Letter 2245 was issued. There will be no advance ruling date on EDS. Also research IDRS with CC INOLE to determine if the EO Status is 25 and if there is an advance ruling date present. If no advance ruling date is present, it can be found by reprinting the 2245 Letter through the Letter Generation system on the Inventory Control System Menu on EDS.

    1. If an Advance Ruling Letter 2245 was issued to the organization as shown on EDS and the termination period began prior to January 1, 2002, but Master File was not updated, update the advance ruling date as indicated in the advance ruling letter using CC EOREQ/EOCHG, TC 016 Doc. Code 80. It isn't necessary to update the EO Status to 25 because the Termination Code 1 will update the status systemically.

    2. If no advance ruling letter was issued to the organization, the EO Status is 25, and there is no advance ruling date on Master File, notify the organization with Letter 3064C they must apply for an advance ruling to qualify for the 507(b)(1)(B) termination per Publication 578. Also notify the organization they will receive a balance due notice. Input a TC 016 Definer Code B to update the EO Status to 01. Circle out the Termination Code 1 on the return.

EO Status Code 26
  1. Status Code 26 ("Termination/Merger " ) is used for the account which is no longer in existence when two exempt organizations are merged (both accounts were exempt either by individual rulings or by a group ruling). All the EO filing requirements will be updated to zero.

    Note:

    When returning an account to Status 01, use the ruling date as the status date, if available.

  2. When updating an account to EO Status Code 26, always input the x-reference EIN if available.

EO Status Code 28
  1. Status Code 28 ("No longer a member of a group ruling" ) is input systemically if a parent account is placed into Status 29 or 97. All the EO filing requirements will be updated to zero.

  2. If an account is in status 28 on Master File and indication is received indicating the organization is still operating (files a return etc), update the account to status 36 or 40. Status 40 should be used if the subsection is IRC 501(c)(3), (9) or (17). Status 36 should be used for all subsections other than IRC 501(c)(3), (9) or (17).

  3. If organizations in Status 28 file a return, update the Status to 40 and post the return if the subsection is IRC 501(c)(3), (9) or (17). If the organization in Status 28 has a subsection other than 03, 09, or 17, update the Status to 36 to post the return. If the organization has already filed for and received exempt status as indicated on EDS, update the Status to 01, using the effective date as the status date.

EO Status Code 29
  1. Status Code 29 is used when a group ruling was dissolved. All the EO filing requirements will be updated to zero.

  2. To update a parent to an individual ruling, input TC 016, Doc. Code 80, Definer Code G, From GEN (must not be 0000 or 9999), Affiliation Code of 1 or 3, New GEN 9999, with ruling date as the status date, Form 990 FR (must be 01, 02 or 06), FYM, Classification Code, Subsection Code, Foundation Code of 10 - 18 is SS - 03, and Remarks.

  3. Status 29 should no longer be input by the campus. IRM 3.13.12.12.7 for information on dissolving a group ruling.

EO Status Codes 30-33
  1. Status Code 30 applies to churches, their integrated auxiliaries, and conventions or associations of churches as described in IRC 501(c)(3) who voluntarily file Form 990 though not required to file returns or apply for exemption.

    1. When the church without an exemption files the Form 990, it will unpost as a UPC 366.

    2. Establish the EO section with EO Status Code 30 using the current month and year as the status date with TC 016 Doc. Code 80 Definer Code B. No filing requirement is necessary. Status Code 30 will bypass the UPC 329 check and allow the Form 990 to post in the future.

      Caution:

      If a church has filed for and received an exemption, don’t update the EO Status from 01 to 30

    Note:

    Beginning January 2004 a Form 990-T or a payment for a Form 990-T will automatically post to account in EO Status 30 if the name control and EIN on the return or payment match the name control and EIN on Master File. A Form 990-T filing requirement will not be added to the module.

  2. Status Code 31 applies to small organizations other than churches and private foundations who normally have annual gross receipts less then $5,000 and who voluntarily file Form 990 though not required to apply for exemption.

    1. Establish the EO section with EO Status Code 31 using the current month and year as the status date with TC 016 Doc. Code 80 Definer Code B, filing requirement 990-02. Status Code 31 will bypass the UPC 329 check and allow the Form 990 to post in the future.

    2. If an organization applied under a particular subsection and was denied (Status 70), don’t update the Status to 31 under the denied subsection.

    Caution:

    Don’t update an account to EO Status 31 unless the following criteria is met: During the first taxable year the organization received gross receipts of $7,500 or less, or during the first two taxable years, the organization's aggregate gross receipts were $12,000 or less, or during the first three taxable years or if the organization is in existence for three or more years, the aggregate gross receipts received by the organization in the immediately preceding two taxable years plus the current year are $15,000 or less.

    Note:

    According to IRC 6033(a)(2), the following organizations (other than a private foundation described in IRC 509(a)) whose gross receipts are normally $5,000 or less don’t have to file a Form 1023 or Form 1024): an educational organization described in IRC 170(b)(1)(A)(ii), a charitable organization or an organization for the prevention of cruelty to children or animals as described in IRC 501(c)(3). Status 31 applies to IRC 501(c)(3) organizations (excluding churches) with gross receipts normally $5,000.

  3. Status 31 Transcripts will be issued weekly if a Form 990 posts to an account in EO Status 31 and the gross receipts are $50,000 or greater. The transcripts will be titled "Status 31 over $50,000" and contain the following information: organization name, EIN, tax period of the Form 990 and gross receipts. Process the transcripts as follows:

    1. Research CC BRTVU to determine the gross receipts for the last three years.

    2. An organization's gross receipts are considered normally not more than $5,000 if:
      The first taxable year it receives gross receipts of $7,500 or less,
      The first two taxable years, its aggregate gross receipts are $12,000 or less, and
      The first three taxable years or if the organizations was in existence for three or more years, the aggregate gross receipts received by the organization in the immediately preceding two taxable years plus the current year are $15,000 or less.

    3. If the organization's gross receipts are found to be greater than $5,000, update the EO Status Code to 40 with a TC 016 Doc. Code 80 Definer Code B if the subsection is 03/09/17/20/29. If the subsection is other than 03/09/17/20/29, update the EO Status to 36.

    4. If the organization's gross receipts are found to be less than $5,000, continue processing.

    5. Check EDS for any change in the organization's status code. Update if necessary with a TC 016 Doc. Code 80 Definer Code B.

    6. After the transcript is worked, destroy per local service center procedures.

  4. Status Code 32 applies to CP 140s and CP 144s with no response to the notice. If no TC 150, 460, 590, 591, 594-599 has posted to a tax module with a Form 990 filing requirement within 90 days of the issuance of the notice, the system will automatically update the EO Status to 32 with a TC 016 Doc. Code 80 Definer Code B.

    Note:

    Due to the difference between the receipt of a return and the posting of a return, EO Status Code 32 may not update to 01 Status. If a return is received and account is in Status 32, update to Status 01.

    Note:

    Status Code 32 should not be used after January 1, 2008 since the CP 140 and 144 notices are obsolete.

  5. Status Code 33 applies to foreign private foundations described in IRC 4948(b) which are not required to apply for exemption but are required to file a Form 990-PF to pay 4% tax on gross investment income derived from sources within the United States.

    1. When these types of foreign private foundations file their Form 990-PF, it will unpost as UPC 366.

    2. Establish the EO section with EO Status Code of 33 using the current month and year as the status date with TC 016 Doc. Code 80 Definer B. No filing requirement is necessary. Status Code 33 will bypass the UPC 329 and will allow the Form 990-PF to post in the future.

EO Status Code 34
  1. Status Code 34 applies to political organizations operating under the rules of IRC 527. Generally, there are two types of 527 organizations:

    Type Description
    Federal Organizations
    1. FEC political committee: A political organization (including federal candidate committees, political party committees and PACs) which is required to report as a political committee under the Federal Election Campaign Act.

    2. Other federal political organization: A political organization attempting to influence federal elections which isn't required to report as a political committee under the Federal Election Campaign Act.

    State/Local Organizations
    1. Candidate committee: A campaign committee of a state or local candidate.

    2. Party committee: A state or local committee of a political party.

    3. Qualified state or local political organization (QSLPO): A state or local committee whose political activities relate solely to a state or local public office, is subject to state law which requires it to report to a state agency information about contributions and expenditures, makes reports publicly available, and no federal candidate or office holder controls it, participates in its direction, or solicits contributions for it.

    4. Caucus or association: a group of state or local officials attempting to influence elections.

    5. Other political organization: any other state or local political organization.

    1. Filing Requirements: The filing requirements in the chart below apply to those tax-exempt political organizations which receive or expect to receive $25,000 or more in gross receipts in any taxable year.

      If the Organization is a It May Be Required to File
      FEC political committee, state or local candidate committee or state or local committee of a political party, Form 1120POL.
      Qualified state or local political organization (QSLPO)*, Form 8871;
      Form 1120POL; and
      Form 990.
      Caucus or association of state or local officials*, Form 8871;
      Form 8872; and
      Form 1120POL.
      Any other political organization, including other federal political organizations and other state or local political organizations, Form 8871;
      Form 8872;
      Form 1120POL; and
      Form 990 or Form 990-EZ.

      *An organization may be both a QSLPO and a caucus or association of state or local officials. If so, it isn't required to file Form 8872 and Form 990.

      Note:

      If the political organization doesn't have gross receipts of at least $25,000, it must file Form 1120 POL if it has taxable income after taking the $100 specific deduction for any taxable year.

    2. IRM 3.13.12.14.1 for Form 8871/8453-X instructions. IRM 3.13.12.14.3 for Form 8872 instructions.

EO Status Code 35
  1. Status Code 35 applies to foreign entities the IRS has agreed are exempt by treaty with the participating country but have no foundation code. For example, Canadian charities would be set up on Master File with an EO Status Code of 35.

    1. When this type of foreign entity files a Form 990-PF, Form 990 or Form 990-T, it will unpost as UPC 366.

    2. Establish the EO section with EO Status Code 35 using the current month and year as the status date with TC 016 Doc. Code 80 Definer B. No filing requirement is necessary. Status Code 35 will bypass the UPC 329 check and will allow the return to post in the future.

    3. For a complete list of countries the IRS has agreed are exempt by treaty refer to Publication 515, Tax Treaty Table 3.

EO Status Code 36
  1. Status Code 36 applies to Form 990 filers with a Subsection other than IRC 501(c) (3), (9), (17), (20) or (29).

    If Then
    The return is unprocessable and the subsection indicated on the return is other than 03/09/17/20:
    1. Make the necessary corrections to resolve the unprocessable condition.

    2. Determine the classification code using Document 6379 (II-3).

    3. Establish the EO Section with a Form 990 FR of 01, EO Status Code 36 using the current month and year as the status date, FYM, subsection code as indicated on the return, classification code and remarks with a TC 016 Doc. Code 80 Definer Codes AB.

    Note:

    Beginning January 2004 a Form 990-T or a payment for a Form 990-T will automatically post to account in EO Status 36 if the name control and EIN on the return or payment match the name control and EIN on Master File. A Form 990-T filing requirement will be added to the module.

EO Status Code 40
  1. Use Status 40 to create an EO section for a return marked with SS 03, 09, 17, 20 or 29 which has not been granted an exemption at the time the return was filed.

  2. Beginning 2010, the Status 40 program will be automated. History sheets will no longer be generated and sent to Entity.

  3. If Forms 990 (DD 03/09/17/20/29) or Forms 990-PF (other than 4947(a)(1)) are received and research doesn't reveal an exemption, use Status 40. If a BMF FRC for Forms 1041, 1065 or 1120 is on the BMF account, zero out the applicable FRC.

  4. Add the EO account to BMF through IDRS with CC EOREQ/CC EOCHG.

    If Then
    The account isn't on the BMF, Input a TC 000 with Doc. Code 63. Input a TC 016 Doc. Code 80 Definer Code B, Status Code 40 and remarks.,
    The account is on the BMF, Input a TC 016 Doc. Code 80 Definer Code B, Status Code 40 and remarks.
EO Status Codes 41 and 42
  1. Status Code 41 ("Failed to Reply to Solicitation for Application" ) is used by Entity for purported IRC 501(c)(3)/(9)/(17)/(20)/(29)/ organizations which have finished the Status 40 process. When processing "Status 40" cases, the organization is notified by a CP 120 and an application for exemption is solicited. If the organization doesn't apply and receive a formal exemption, the account will be put into Status Code 41 and 1120 filing requirements will be added. When manually inputting this status, a filing requirement for Forms 1041, 1120 must be input, and at the same time all the EO FRCs should be deleted. If an organization in Status Code 41 files a subsequent return, process as follows:

    If Then
    The return is unprocessable and the subsection indicated on the return is other than 03/09/17/20/29:
    1. Make the necessary corrections to resolve the unprocessable condition.

    2. Determine the classification code using Document 6379 (II-3).

    3. Establish the EO Section with a Form 990 FR of 01, EO Status Code 36 using the current month and year as the status date, FYM, subsection code as indicated on the return, classification code and remarks with a TC 016 Doc. Code 80 Definer Codes AB.

    The subsection on the return is 03/09/17/20/29,
    1. If the organization filed a Form 990/990-EZ and the subsection indicated on the return is 03/09/17/20/29, correspond with the organization using Letter 3909C. If the organization doesn't reply with an application for exemption or a Form 1120/1065/1041, update the EO Status Code to 99.

    2. If the organization filed a Form 990-PF, input a TC 016 Doc. Code 80 Definer Codes AB, 990-PF FR of 1, TF 04, and EO Status 01 to allow the Form 990-PF to post. Cycle the TC 150 to post after the TC 016. Input a second TC 016 to remove the Form 990-PF FR and add a Form 1041/1065/1120 FR, add any other filing requirement (Form 940 or Form 941), and change the EO Status Code to 99.

    3. If the organization filed a Form 990-T and the subsection on the return is 03/09/17/20/29, input a TC 016 Doc. Code 80 Definer Codes AB to update the EO Status to 31 and remove the Form 1041/1065/1120 FR. Cycle the TC 150 to post after the TC 016. Input a second TC 016 to update the EO Status to 99 and add the Form 1041/1065/1120 FR (and any other FRs like Form 940 or Form 941) back onto the module.

    4. If the organization filed a Form 990-T and the subsection on the return is other than 03/09/17/20, input a TC 016 Doc. Code 80 Definer Codes AB to update the EO Status to 36, remove the Form 1120 FR, add the Form 990 FR of 01, add the Form 990-T of 1, add the subsection as indicated on the return, and input the classification code using Document 6379 (11-3). Do not return the EO Status to 41 after the posting of the return.

    The name on the return indicates the organization is a federal credit union
    1. Verify the status at www.ncua.gov.

    2. Ensure the status on the website is for a Federal Credit Union (FCU) and not listed only as a Federally Insured State Credit Union (FISCU).

    3. If account is a FCU on the website above, input a TC 016, Definer Codes ABC and update the status to 01 as a 501(c)(1) organization, filing requirements 990-07.

    4. If the account isn't located on the website or is listed only as an FISCU, update the account to status 36, subsection code 14 with 990–01 filing requirements.

    The account is in Status 42
    1. Update 501(c)(3), (9), (17), (20) or (29) 990 filers to Status 40.

    2. Update other than a 501(c)(3), (9),(17), (20) or (29) 990 filers to Status 36.

  2. Status Code 42 was used by EO Entity when an extension of time to file is received from an organization which doesn't have an exemption. EO Entity receives these extensions as unprocessable documents. EO Entity used Status 42 to post a payment received prior to the posting of the organization's first EO return; the payment will unpost as a UPC 366. As of September 2011, Status 42 is no longer used.

EO Status Codes 70-72
  1. Status Code 70 ("Exemption Denied " ) is input by Cincinnati when, on the merits of the application, an exemption cannot be granted. This status will generate a Form 1120 filing requirement of 01.

  2. Status Code 71 ("Failed to Establish and Incomplete Form 1023/1024" ) is input by Cincinnati when the application is incomplete and a request for the information was not received. This status will generate a Form 1120 filing requirement of 01. If the Form 1120 filing requirement is missing, add the FR to the account.

  3. Status Code 72 ("Refusal to Rule " ) is input by Cincinnati when the applicant is unable to furnish a detailed description of its planned activities. This description would clearly indicate whether the organization was exempt or not. This status will generate a Form 1120 filing requirement of 01.

EO Status Code 97
  1. Status 97 is automatically updated on IDRS when an organization fails to file a Form 990 or 990–PF for three consecutive years. This status will automatically generate a Form 1120 filing requirement.

  2. An account in Status 97 is required to file Form 1120 or re-apply for tax exempt status by filing Form 1023 or 1024 and paying all applicable fees.

    Note:

    IRM 3.13.12.11.4 for further instructions.

EO Status Codes 98 and 99
  1. Status 98 is input by EO Entity when an organization is identified as a terrorist organization by National Office. This status will automatically generate a Form 1120 filing requirement. When an organization Status 98 files an exempt organization return, it will unpost.

  2. Status 99 is input by EO Entity when an organization in EO Status 22, 41, 70-72 files another exempt organization return and they still don’t have an exemption. The status will automatically generate a Form 1120 filing requirement. All exempt organization returns and any associated payments filed in future tax years will automatically post. This status code will replace the procedure of shelving status 22, 41, 70-72 returns which could not be posted in the past. EO or SBSE Examination will use Status 99 to determine what organizations require an audit. When a return unposts because the Status is 22, 41, 70-72, process as follows:

    1. Research EDS to determine if the organization has filed a new application for exemption is pending on EDS. If new application is pending, input a TC 016 Definer Code B to update the Status Code to 40 and remove the Form 1120 filing requirement.

      Note:

      New EO applications as of July 2007 will be processed through TEDS.

    2. If EDS shows an F case, input a TC 016 Doc. Code 80 Definer Codes AB to remove the 1120 filing requirement and add the information on EDS to Master File.

    3. If EDS doesn't show a good exemption, correspond with the organization using the 3909C Letter for Status 41 organizations or the 3877C Letter for Status 22, 70-72 organizations. If a determination letter isn't provided, or a new application for exemption submitted, or there is no reply, update the EO Status to 99 with a TC 016 Doc. Code 80 Definer Code B. If the organization provides information indicating exemption, update Master File per the organization's response with a TC 016.

Ruling Date

  1. When inputting the Ruling Date (RD) with CC EOREQ/EOCHG and the Document Code is either 80 or 81:

    1. A ruling date is the date when the exemption was issued to the organization.

    2. The pilot voucher has this date for all subordinates of a group.

    3. A ruling date for individual exemptions can be found on EDS, or on the original exemption letter and on the entity EO section.

    4. The date is input as YYYYMM.

  2. If the Document Code is 80, the TC must be 000 or 016.

    If Then
    TC is 000, Status must be 01.
    TC is 016, Definer Code must be C.
  3. If the Document Code is 81, the TC must be 016 and the Definer Code must be C or D.

Activity Code

  1. When inputting the Activity Code (AC) with CC EOREQ/EOCHG and the Document Code is either 80 or 81:

    1. For Document Code 80, the TC must be 000 or 016.

    2. For Document Code 81, the TC must be TC 016.

  2. The following subsection codes can have only one three digit activity code as follows:

    Subsection Activity Code
    22 931
    70 990
    90 928
    91 909
    92 909
    93 234
  3. Activity Code 990 is used for Status 70-72.

  4. For further information, see IRM 2.4, IDRS Terminal Input.

Deductibility Code

  1. When inputting the Deductibility Code (DY) and Year with CC EOREQ/EOCHG and either Document Code 80 or 81:

    1. For Document Code 80, the TC must be 000 or 016.

    2. For Document Code 81, the TC must be 016.

  2. The first position of the DY must be:

    • 1 for deductible,

    • 2 for non-deductible, or

    • 4 for foreign deductible.

  3. The second through the fifth position is the year and is input as YYYY.

    1. If the Deductibility Code is 1 or 4, enter the effective date as the YYYY.

    2. If the Deductibility Code is 2, enter the 0000 (zeros) for the YYYY.

  4. If the Subsection Code is input, it must be as follows:

    If Then
    Doc. Code is 80 and DY is 1YYYY or 4YYYY, SS must be 01, 03, 04, 08, 10, 13, 19, 20, 50, 60 or 70.
    Doc. Code is 81 and DY is 1YYYY, SS must be 01, 03, 04, 08, 10, 13, 19, or 70.

    Note:

    If the deductibility code is missing from a Form 2363-A, contact with Cincinnati must be made to correct the Form 2363-A. The TE will notify the Lead who will contact the TEGE Analyst with oversight. The TEGE Analyst will contact Cincinnati to get the correct deductibility code.

From GEN

  1. When inputting the From GEN (FG) with CC EOREQ/EOCHG and Document Code is either 80 or 81:

    1. TC must be 016.

    2. From GEN is a four digit number between 0001–9998.

    3. Use From GEN when changing a GEN or when updating a group exemption.

  2. From GEN is used when:

    • Changing a GEN,

    • Updating a group exemption, or

    • An affiliation code change is being made to a parent and Definer Code C or F must be used.

New GEN

  1. When inputting the New GEN (NG) with CC EOREQ/EOCHG and Document Code is 80:

    1. The TC must be 016.

  2. When TC 016 with Document Code 80 is input, the following items must be input:

    1. Definer Code C must be input.

    2. If the NG is 9999, the From GEN must be input and the Affiliation Code must be 1, 2, or 3.

    3. If NG is 0002–9998, the AF must be 6, 7, 8, or 9.

  3. A New GEN is assigned to a new exemption. IRM 3.13.12.12 for information on group rulings.

File Folder Number

  1. When inputting the File Folder (FF) with CC EOREQ/EOCHG and the Document Code is either 80 or 81:

    1. If the Document Code is 80, the TC must be 016.

    2. If the Document Code is 81, the TC must be 016.

    3. The file folder number is generated on EDS when the file is created. It is based on location and the current julian date.

Pension Plan

  1. When inputting the Pension Plan (PP) with CC EOREQ/EOCHG and the Document Code is either 80 or 81:

    1. Valid range is 1, 2, or 9.

    2. If the Document Code is 80, the TC must be 016.

    3. If the Document Code is 81, the TC must be 016.

  2. If the Document Code is 81, the following items must be present:

    1. Definer Code must be D.

    2. PP must be 2.

  3. To delete a pension plan, input 9.

Advance Ruling Date

  1. When inputting the Advance Ruling Date (AD) with CC EOREQ/EOCHG and the Document Code is 80:

    1. TC must be 016.

    2. The AD is input in YYYYMM format. This allows input of dates in the year 2001 and beyond.

    3. The AD cannot be prior to the current input date.

    4. To delete the AD, input 999999.

Large Case

  1. When inputting the Large Case (LC) with CC EOREQ/EOCHG and the Document Code is 80:

    1. TC must be 016.

    2. Valid input is 1, 2, 9.

    3. To delete a LC, input a 9.

    Note:

    The LC field isn't entered by Entity Control. It must be input by Cincinnati.

Employment Code

  1. BMF Employment Codes are A, C, F, G, I, M, S, T, and W. See table below.

    Code Type of Employer
    A Government agent acting as an Employer (Fiscal) Agent under IRC 3504
    C Church or Church-Controlled Organization which filed Form 8274 (Not subject to FICA or FUTA)
    F Federal Employer
    G State or Local Government Agency
    I Indian Tribal Governments
    M Maritime Industry
    Q Quasi-governmental entities
    S Foreign Subsidiary
    T State or Local Government Agency covered under a Section 218 agreement
    W IRC 501(c)(3) : Non-profit Organization (Not subject to FUTA)
  2. A "9" deletes any existing employment code.

  3. Except for Job Corps and Volunteers in Service to America, economic opportunity programs are carried on by state and local governmental entities or private non-profit organizations through grants or contracts with the Federal Government. When new entities are formed to carry out economic opportunity projects they will be state or local government entities or non-profit organizations. Examples of Economic Opportunity Act Employers (E.O.A. Employers) are as follows:

    • Anti-Poverty Programs

    • Community Action Programs

    • Head Start Programs

    • Neighborhood Youth Corps

    • Public Law 88–452

    • Economic Opportunity Act, Office or Program

    • Work Study or Work Training Program

    • Youth Conservation Corps (YCC)

    • Job Corps

    • Volunteers in Service to America

  4. Government entities with employment codes A, F, G, Q or T are not required to file Form 990. Government entities may file Form 990-T. To establish the sub-module research EDS or place account in status which is applicable for filing Form 990-T.

  5. When inputting the Employment Code (EC) with CC EOREQ/EOCHG and the Document Code is 80:

    1. TC may be 000 or 016, and

    2. Valid ECs are S, W, M, or 9.

  6. If input EC is W:

    1. FRC for Form 941 must be 01 or 07, if input.

    2. SS must be 03, 50, 60, or 70, if input.

    3. and Doc. Code is 80, the Status Code must be 01-03, 07, 10 or 11, if input.

  7. Programming was added to restrict the input of employment codes A, F, G, Q & T to employees in Compliance, Federal, State and Local Government (FSLG). Send cases that need input of those restricted government employment codes to FSLG for input. Perform all needed actions except the input of the employment code and transmit the case with a completed transmittal, Form 3210, to FSLG CPM via EEFax (855) 243–4014 or mail it to:
    Internal Revenue Service
    SE:T:GE:FSL:CPM
    300 East 8th ST
    Mail Stop 4098 AUS
    Austin, TX 78701

Employment Code A
  1. Employment Code A is used by TEGE Government Entities for government fiscal agents who file Form 940 for employers who are not associated with government agencies. Form 940 and Form 941 filing requirements may be added.

Employment Code C
  1. A TC 070 posted to churches or qualified church-controlled organizations which have filed Form 8274, Certification by Churches and Qualified Church Controlled Organizations Electing Exemption from Employer Social Security and Medicare Taxes, generates an Employment Code C.

    Note:

    Refer to IRM 3.13.12.17.2 for processing.

Employment Code F
  1. This code is only assigned to agencies of the United States.

  2. Entity cannot assign Employment Code F.

Type of Employment Code F Organizations
  1. Assign employment code F to an executive department of the government, or component agency of the government such as:

    • Department of State

    • Department of the Treasury

    • Department of Defense

    • Department of the Army

    • Department of the Navy

    • Department of the Air Force

    • Department of Health and Human Services

    • Department of Education

    • Department of the Interior

    • Department of Commerce

    • Department of Labor

    • Department of Transportation

    • Department of Housing and Urban Development

    • Department of Justice

    • Department of Agriculture

    • Department Veteran's Affairs

  2. Assign Employment Code F to an agency of the U.S. Government which isn't part of any executive department or its components at the National Headquarters or in the field such as:

    • U.S. District Court

    • U.S. Court of Appeals

    • U.S. Tax Court

    • General Services Administration

    • U.S. Atomic Energy Commission

    • Federal Trade Commission

    • Government Accountability Office

    • Office of Economic Opportunity

    • Federal Power Commission

    • U.S. Small Business Administration

    • Library of Congress

    • Interstate Commerce Commission

    • Veterans Administration

    • Smithsonian Institution

    • Securities and Exchange Commission

    • National Aeronautics and Space Administration

  3. Assign Employment Code F to a corporation, created by law, which performs a governmental function and is wholly or principally owned by the U.S. Government:

    • Federal Deposit Insurance Corporation

    • U.S. Postal Service

    • Tennessee Valley Authority

    • Federal Reserve Board

      Exception:

      Individual Regional Federal Reserve Banks which are employment code "Q" .

    • Federal instrumentalities such as
      Army and Air Force Post Exchange,
      Navy or Coast Guard Ship Stores, and
      Army and Air Force Motion Picture Services and the Navy Counterpart

  4. Assign Employment Code F to organizations which are closely connected to, but not an official part of the U.S. governmental establishment. Following strict standards, these organizations conduct financial, social, morale or housekeeping activities such as:

    • Officer's Clubs

    • Enlisted Men's Club

    • NCO Clubs

    • Officer's Open Messes

    • NCO's Open Mess

    • Billeting Funds

  5. Before assigning Employment Code F to the organizations referred to in paragraph (4), obtain a statement from the Post, Camp, Station or Base Commander, Ambassador of Head of Mission stating the following:

    1. The activity exists to promote the morale, comfort and well being of members of the Armed Forces, authorized civilians or embassy staff.

    2. The activity is supported by an authorized non-appropriated fund as prescribed by the applicable regulations of the Service concerned.

    3. The activity is authorized by the Post, Camp, Station, Base or Major Command Commander, Ambassador or Head of Mission and is supervised by him or her.

    4. The activity's supervision by the official includes a periodic audit of financial records, or an audit is regularly performed by a higher authority as prescribed by the appropriate service regulations.

    5. If the taxpayer doesn't provide this documentation, don’t assign an employment code of F to the entity.

Not Type of Employment Code F Organizations
  1. Don’t assign Employment Code F to the following:

    • A state or local entity such as a state, county, city, town, school, authority, district as described IRM 3.13.12.6.28.7.

    • A Federal Credit Union which should be coded employment code Z.

    • A foreign entity that isn't clearly associated with the US government overseas operations, generally Department of State, embassies or military installations.

    • Any religious, fraternal or benevolent organization

    • Veterans organizations and related auxiliaries such as Veterans of Foreign Wars (VFW), American Legion, American Veterans (AMVETS) organizations and Disabled American Veterans (DAV).

    • Any ethnic or tribal organization; i.e., Indian tribe, tribal council, etc.

    • Any private corporation or business entity which has in its name words such as "U.S., United States, Federal or Government"

Questionable Employment Code F Organizations
  1. If the employment code can't be determined or is a questionable Employment Code F organization, do the following:

    1. Research the account as necessary.

    2. Contact the organization to clarify its status.

  2. If the organization is determined to be a true Employment Code F organization, remove any erroneous filing requirements such as Form 1120, Form 1065, etc.

  3. If the organization is determined to not be a true Employment Code F organization, process as follows:

    1. Remove any erroneous filing requirements.

    2. Remove the "F" code.

    3. Establish the entity with the correct filing requirements. Ensure the organization doesn't have another EIN established for the same "F" code entity.

Employment Code G
  1. Employment Code G is assigned to all state and local government agencies.

  2. Employment Code G assignment is restricted. Entity cannot assign employment code G.

  3. Assign Employment Code G to the following organizations:

    • State or commonwealth

    • Agency, bureau, or department of a state or commonwealth

    • County

    • Agency, bureau, board, or department of any such county

    • Municipality, town, village, ownership or any like unit of local government

    • Agency of a local government, such as a school district, board of education, public school, sanitation district, transit authority, welfare department, housing authority, cemetery, soil or water conservation district, water district, community service district health department, etc.

  4. If a state or local government instrumentality requests and receives an exemption under IRC 501(c)(3) of the IRC, the Employment Code remains a G.

  5. For information regarding the input of employment code G, IRM 3.13.12.6.28 (8).

Employment Code I
  1. Assign Employment Code I to Indian Tribal Governmental entities. National Office ITG will determine if an entity requires an EC I. If so, verify the BOD Code is TE. Update the BOD Client Code to I. Add a Form 940 FR of either 3 (compliant) or 4 (non-compliant) at the time the EC I is added. National Office ITG will determine whether the tribe is compliant or non-compliant. There is no need to forward any information to National Office.

  2. If an Indian Tribal Governmental entity also has an IRC 501(c)(3) exemption, the Employment Code must be W with no Form 940 filing requirement.

  3. If Master File research indicates the EO Status is 41, 70-72, treat the entity as if they are a "regular" ITG entity with a BOD Code of TE, EC of I, BOD Client Code of I or 1, and a Form 940 FR of 3 or 4.

  4. If the EO Status is 40 or 42, the BOD Code should be TE, make no changes to the EC, BOD Client Code or filing requirements. If the EO Status was in 40 for several years and the organization is continuing to file Forms 941 only and there is no "I" case on EDS, update the EO Status to 41 and treat as a "regular" ITG entity.

Employment Code M
  1. Assign this code to those maritime industry entities which have made payments for employment taxes not yet reported. This situation arises when a shipping company estimates liabilities and makes payments currently. However, the actual liability is reported on a supplemental Form 941 filed at the termination of the voyage.

Employment Code S
  1. Assign Employment Code S to a domestic business which has applied for another EIN to extend social security coverage to certain employees of its foreign affiliates by filing Form 2032, "Contract Coverage under Title II of the Social Security Act as Amended" . Don’t establish a Form 940 FRC for these entities.

Employment Code T
  1. This code is never to be assigned from Form SS-4.

  2. Employment code T is strictly controlled by FSLG CPM and should never be assigned outside that unit. All 218 Agreements, modifications and dissolutions are currently required to be sent directly to FSLG CPM from the state social security administrators and regional social security administration offices.

  3. If any such documents are received at the campus they should be sent directly to FSLG CPM for action.

  4. Send with a transmittal Form 3210 via fax to the FSLG CPM EEFax (855) 243–4014 or mailed to:
    Internal Revenue Service
    SE:T:GE:FSL:CPM
    308 E 8th St.
    Mail Stop 4098 AUS
    Austin, TX, 78701

Employment Code W
  1. Assign Employment Code W and a Form 941 FR of 01 to non-profit organizations with employees of the type described in IRC 501(c)(3), 501(e), 501(f), 501(k) and 501(n) of the IRC. These organizations are operated exclusively for religious, charitable, scientific, literary, educational, or humane purposes, or for the purposes of testing for public safety.

  2. Non-profit organizations are not subject to FUTA. They are also not subject to FUTA tax during the application for exempt status. Apply FUTA tax if it is determined an application for exempt status has not been submitted.

  3. A church has an IRC 501(c)(3) status but doesn't officially have to file an application for exemption. If the name of the organization contains the following word(s), assign an EC W:

    • Assembly or Assembly of God

    • Chapel

    • Church

    • Fellowship

    • Jehovah's Witness

    • Monastery

    • Seventh Day Adventist

    • Synagogue

    • Mosque

    • Temple

    • Worship Center

    • Iglesia

    • Kirche

  4. A ministry, however, isn't considered a church and must apply for exemption. If the name of the organization contains the word "ministry," don't assign EC W.

Fiscal Year Month

  1. The fiscal year month ending (FYM) is a two digit code of 01 through 12. It is the month in which the fiscal year of the entity ends.

  2. Input the FYM on all Exempt Organization returns which can be any month.

    Exception:

    Forms 5227 filed by Non-exempt Charitable Trusts under IRC 4947(a)(2) must have an FYM of 12, unless filing a final return.

  3. Input the month indicated by the organization.

  4. If no FYM is indicated, enter:

    1. the month preceding the date the business was acquired,

    2. the month preceding the date wages or annuities were paid, OR

    3. the month preceding the current month.

    Exception:

    Forms 5227 filed by Non-exempt Charitable Trusts under IRC 4947(a)(2) must have an FYM of 12, unless filing a final return.

  5. If a Form 1128, Application to Adopt, Change or Retain a Tax Year, is received with a Form SS - 4, refer to IRM 3.13.12.18.

  6. When inputting the Fiscal Year Month (FY) with CC EOREQ/EOCHG and the Document Code is 80 or 81:

    If Then
    Doc. Code is 80, TC may be 000, 012, or 016.
    Doc. Code is 80 and a positive FRC is input for Forms 990, 990-C/1120-C, 990-PF, 990-T, 1041, 1065, 1120 or 5227, FY must be input.
    Doc. Code is 81, TC is 016. Don’t input an FY unless it is intended that all subordinates are to have the same FY.
    FRC is for Form 5227, FYM must be 12.

National Taxonomy of Exempt Entities Codes

  1. When inputting the National Taxonomy of Exempt Entities Code (NTEE) with CC EOREQ/EOCHG and the Document Code is 80 or 81:

    1. If Document Code is 80, the TC must be 000 or 016.

    2. If Document code is 81, the TC must be 016.

  2. For further information, see IRM 2.4, IDRS Terminal Input.

Remarks

  1. When inputting the Remarks (RM) with CC EOREQ/EOCHG and the Document Code is 80 or 81, it is:

    • A required field for all EOCHG transactions.

    • Variable; i.e., it must be at least 10 but not more than 35 characters in length.

  2. Remarks should be written to leave a history for future reference.

Filing Requirements

  1. Use TC 000, 012 or 016, Document 80, to add a positive FRC to the BMF. The validity and consistency checks will be performed when the input FRC is positive; i.e., greater than zero.

  2. To delete an EO FRC, use Document Code 80 or 63. If the input is only to delete a BMF FRC, use CC BNCHG. No definer code is necessary as long as the only change being made is to delete the FRC. However, if you are using CC EOCHG and the only action is to delete a FRC, the input must be as follows:

    1. Document Code must be 80.

    2. TC must be 016.

    3. Remarks must be input.

    4. Input zero in FRC being deleted

  3. Add 990 filing requirements as follows:

    1. If the 990 return indicates gross receipts greater than $50,000, update the 990 filing requirements to 990-01.

    2. If the 990 return indicates gross receipts less than $50,000, update the 990 filing requirements to 990-02.

    3. If there is no indication or unable to determine gross receipts, update the 990 filing requirements to 990-02.

    Note:

    Never use CC EOCHG to delete or update a Form 990-T, or a non-EO FRC, unless there is an EO Section already on the BMF, or you are adding an EO Section for the first time.

  4. Always input the fiscal year month if the FRC is for Forms 990, 990-C/1120-C, 990-PF, 990-T, 5227, 1041, 1065 or 1120.

Form 941 FRC
  1. The validity and consistency checks for 941 FRC are as follows:

    1. Valid input codes are 00, 01 or 07.

    2. If Document Code is 80, the TC must be 000, 012 or 016.

Form 940 FRC
  1. The validity and consistency checks for Form 940 FRC are as follows:

    1. Valid input codes are 0, 1, 2, or 7.

    2. If Document Code is 80, the TC may be 000, 012, or 016.

    3. If the FRC is 1 or 2, than a 941 FRC of 01 or a 943 FRC of 7 must be input.

    4. The Employment Code must NOT be W.

Form 942 FRC
  1. If a Form 942 FRC is input, it must be 0.

Form 943 FRC
  1. The validity and consistency checks for Form 943 FRC are as follows:

    1. Valid input codes are 0, 1, or 7.

    2. If the Document Code is 80, the TC may be 000, 012, or 016.

Form 966, Corporate Liquidation or Dissolution
  1. If Form 966 is received, process per instructions in IRM 3.13.2.24.

Form 1120 FRC
  1. The validity and consistency checks for Form 1120 FRC are as follows:

    1. Valid input codes are 01, 03, 07, or 09.

    2. Fiscal year month must be input.

    3. If Form 1120 FR is 01, 03, 04, 07, or 09, then the TC must be 012 or 016.

    4. If the Status Code isn't 41 or 70-72, then Transaction Definer Code A must be input.

    5. The subsection code must be input. The chart below shows the valid combinations of Form 1120 FRs. and subsection codes as well as any additional consistency checks.

    1120 FR SS CD 990 FR 990-PF FR 990-C FR TF CD
    01 03 1 03 or 04
    01 12 01
    03 12 01
    04 15 01
    09 or 18
    09 01, 02, 04-23, 50, 60, or 70
Form 1065 FRC
  1. Validity and consistency checks for Form 1065 FRC are as follows:

    1. Valid input codes are 0 or 1.

    2. If Form 1065 FR is 1, then the Doc. Code must be 80.

    3. The TC must be 000, 012, or 016.

    4. If TC is 012 or 016 and SS is 02-23, 50, 60, or 70, then Transaction Definer Code A must be input.

    5. If the SS is 99, or isn't entered, than the Status Code must be 07, 10 or 11.

Form 1041 FRC
  1. Validity and consistency checks for Form 1041 FRC are as follows:

    1. Valid input codes are 0, 1, or 2.

    2. If Form 1041 FRC is 1 or 2, then the Document Code must be 80.

    3. Fiscal year month must be input.

    4. If the Status Code isn't 41 or 70-72, then the Transaction Definer Code A must be input.

    5. If SS is 90, then the Form 5227 FR must be 1 or 2.

    6. If SS is 91, then the Form 990 FR must be 01 or 02.

    7. If SS is 92, then the Form 990-PF must be 1.

Form 5227 FRC
  1. Validity and consistency checks for Form 5227 FRC are as follows:

    1. Valid input codes are 0, 1, or 2

    2. The Document Code must be 80.

    3. The Subsection Code must be 90.

    4. Fiscal year month must be 12.

    5. The TC must be 000, 012, or 016.

    6. If the TC is 012 or 016, the Definer Code A must be input.

Form 990 FRC
  1. Validity and consistency checks for Form 990 FRC are as follows:

    1. Valid input codes are 01, 02, 03, 04, 06, 07, 13 or 14.

    2. If Form 990 FR is 01, 02, 03, 04, 06, 07 or 13, then the Document Code must be 80 or 81.

    3. If the Document Code is 81, the TC must be 016 and Definer Code must be D.

    4. If the Document Code is 80, the TC must be 000, 012 or 016.

    5. If the TC is 012 or 016, the Definer Code A must be input.

    6. The subsection code must be consistent with the 990 FR. The chart below shows the valid combinations of Form 990 FR and subsection codes as well as any additional consistency checks.

    990 FR SS Code Status Code Found Code Class Code
    01 02, 04-20, 22, 23, 24, 25, 50, 60, 70 or 91
    01 03 09-18
    02 02, 04-20, 22, 23, 24, 25, 50, 60, or 91
    02 03 09-18
    03 02, 04-20, 23, or 70
    03 03 09-18
    04 21
    06 03 10
    06 Must be in 99 or not input 07, 10 or 11
    07 01 11
    13 03 09-18 7
    14 01, 04-20, 22-25, 50, 60
    14 03 09-18
Form 990-C/1120-C FRC
  1. See IRM 3.13.2.

Form 990-PF FRC
  1. Validity and consistency checks for Form 990-PF FRC are as follows:

    1. Valid input codes are 0 and 1, 2, or 3.

    2. Fiscal year month must be input.

    3. The SS must be 03 or 92.

    4. If the SS is 03, then the Foundation Code must be 03 or 04.

    5. The TC must be 000, 012 or 016.

    6. If the TC is 012 or 016, then Definer Code A must be input.

Form 990-T FRC
  1. Validity and consistency checks for Form 990-T FRC are as follows:

    1. Valid input codes are 0 and 1.

    2. Fiscal year month must be input.

    3. Document code will be 80 and the TC may be 000, 012, or 016.

    4. If a Form 990 FR is input, it must be 01, 02, 04, 06, 13 or 14.

    5. If the 990 FR is 00 or not input, then the 990-PF FR must be 1 or the Status Code must be 06.

    6. If TC is 000 and is the SS is input, it must be 02-25, 50 or 60.

    7. If TC is 000 and the SS in not input, then the Status Code must be 06, 07, 10 or 11.

    8. If TC is 012 or 016 and if the SS is 02-25, 50, 60 or 70, then Transaction Definer Code A must be entered.

    9. If TC is 012 or 016 and if the SS is 99, then the Status Code must be 06, 07, 10 or 11.

    10. If TC is 012 or 016 and if the SS isn't entered, then the Status Code must be 06, 07, 10 or 11.

      Note:

      Re-insurance companies may file Form 990-T to report unrelated business income beginning in January 2011. If a form 990-T is submitted by a re-insurance company, the account should be placed into status 06.

FRC – Not Required
  1. Validity and consistency checks for FRC - Not Required are as follows:

    1. Valid input codes are 0 or 1.

    2. NR is valid with Document Code 80 for TC 000, 012 or 016.

    3. If the TC is 016, then the Transaction Definer Code must be A.

Form(s) 8038, 8038-G, 8038-GC and 8328
  1. Forms 8038, 8038-G, 8038-GC and 8328 are forms filed to report Tax Exempt Bond issues.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If these forms are received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

Form 8038 - B
  1. Form 8038 - B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds, is filed by bond issuers to report information on Build America or Recovery Zone Economic Development Bonds.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If a Form 8038-B is received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

Form 8038 - CP
  1. Form 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds, is filed by bond issuers to claim a credit.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If a Form 8038-CP is received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

Form 8038 - TC
  1. Form 8038 - TC, Information Return for Tax Credit Bonds, is filed by bond issuers to report Tax Credit Bonds.

  2. No filing requirements or EO subsection are listed on IDRS.

  3. If a Form 8038-TC is received in Entity, research for the correct name and EIN.

  4. Edit the correct name control and EIN and continue processing.

BOD Code and BOD Client Code Changes

  1. Research CC INOLE or CC ENMOD to verify the Employment Code (EC) is correct. If the EC isn't correct, make the necessary change using CC BNCHG.

    Note:

    The EC must be correct before a change to the BOD Code and BOD Client Code can be made.

  2. There are currently six BOD Client Codes (BCC).

    • B - Tax Exempt Bond (MFT 46 module only)

    • F - Federal/State/Local Government (F/S/L)

    • I - Indian Tribal Government (ITG)

    • 1 - Bond issued by ITG

    • 2 - Bond issued by F/S/L

    • 3 - Bond issued by an exempt organization

  3. The following table shows which BCC can be used with each EC:

    If the EC is Then the BCC can be
    C Blank
    I I or 1
    F F or 2
    G F or 2
    T F or 2
    W B or 3 or Blank
    Blank B or 3 or Blank

    Note:

    Numeric BCCs are systematically updated when an MFT 46 is posted to the account.

  4. To change the BOD Code or BOD Client Code:

    1. Input CC REQ77 with the EIN on the first line, MFT, plan number and tax period on the second line and the name control on the third line. For example:
      REQ77 12-3456789
      00 000 000000
      ABCD

      Note:

      Since there is no MFT, plan number or tax period, zeros are entered on the second line.

    2. When the FRM77 screen appears, input data in the following fields:
      TC>971
      TRANS-DT>MMDDYYYY (current date)
      BOD-CD>TE
      BCC-CD>X (can be either alpha or numeric
      TC 971/151>050
      REMARKS> BOD BCC CHANGE

      Note:

      Both the BOD Code and the BCC must be entered on the same TC 971 even though the BOD Code may not need to be updated. A blank BCC is an exception.

EO Consolidation of EINs

  1. IRM 3.13.12.7 contains procedures for consolidating accounts when an organization has more than one EIN and one or more of the EINs has an EO section on the BMF. These procedures must be followed whenever it is determined a taxpayer has more than one EIN.

EIN Consolidation Procedures

  1. Entity Control will receive research, correspondence, returns, unpostables, etc. from various areas within the Service which indicate a taxpayer has more than one EIN.

  2. To consolidate two EINs, use CCs ENREQ/BRCHG, Document Code 63 and TC 011. Follow local procedures for retention.

  3. Before any account can be consolidated, perform complete research and have the lead sign off on the TC 011 before the transaction input.

    Note:

    No merge transcripts don't require lead approval for a TC 011

    .

  4. If duplicate tax modules are present, input the TC 011, suppress CP 209 by entering a "Z" in the Para-Sel-CD field on the screen.

    Note:

    Consolidation of an account with duplicate tax modules will generate a no merge transcript to Accounts Management. Don’t send the case to Accounts Management requesting the duplicate modules be corrected.

  5. When determining which EIN to retain (" TO" number), use the following preference in this order:

    1. EIN with oldest established date should remain the surviving EIN.

    2. Retain the EIN preferred by the organization.

    3. If no preference is indicated, retain the lower EIN, unless one has a Form 941 FR.

    4. If both EINs have a 941 FRC, retain the lower EIN.

    5. If one EIN isn't on the BMF, and the BMF EIN is still active, retain the BMF EIN.

    6. If the lower EIN isn't active, retain the EIN which has active filing requirements.

    7. If neither EIN is active, retain the lower EIN.

  6. If the EIN which was consolidated (not the surviving EIN) is in Status 97 and on EO Select Check as revoked, , include the EIN and name on the weekly list to have the EIN removed from the EO Select Check revocation list.

  7. A CP 209 will generate to notify the organization of the correct number if the full consolidation was successful.

  8. Send a 139C letter to the organization only if requested.

  9. When reviewing BMFOL or ENMOD, use the following table to determine if a previous consolidation was initiated or if the account is inactive.

    Key to Generated Consolidated Transaction Codes
    Key to Input Consolidation Transaction Codes
    TC 001 Carries complete account of the old (FROM) TIN to the new TIN
    TC 002 Posts on the old (FROM) TIN and carries complete contents of the TC 001 carrier back to the original (FROM) TIN if name controls mismatch.
    TC 003 Posts on the old (FROM) TIN and carries the duplicate tax modules only back to the original (FROM) TIN and changes all filing requirements to 8's. Shows INACTIVE account on IDRS.
    TC 004 Posts on good (TO) TIN indicating duplicate module condition in attempted consolidation.
    TC 005 Posts on the new (TO) TIN and posts as an 005/006 combination if consolidation is successful.
    TC 006 Posts on the good (TO) TIN without the 005 if consolidation attempt is unsuccessful.
    TC 008 Post on the good (TO) TIN indicating a complete consolidation was made to the good TIN above.
    TC 026 Posts on the old (FROM) TIN. Account deleted. TIN changed.
    TC 011 Posts to the old (FROM) TIN to change EIN of an account on Master File and prevents other postings except 002, 003 and 026.
    TC 012 Account Re-established -- Active
    TC 020 Account Deleted -- Inactive
  10. Notify Cincinnati of an EIN change on an exempt organization if the organization's tax exempt determination is on an incorrect EIN.

Conditions for No Merge

  1. Information in 3.13.12.7.3 shows the conditions which can cause a no merge transcript and should be used to determine if the two EINs can be consolidated.

    1. If any of the transactions listed on the chart are identified during review, don't input the TC 011 until the condition is corrected on the BMF.

    2. Correct either the EIN that is identified to be the "FROM" account or the EIN identified to be the "TO" account.

    3. Remember always correct the accounts so after the consolidation the "TO" account will have the proper organization identification of filing requirements, EO section, FYM, etc.

  2. If only one account has an EO section, the Master File will retain the EO section from either number.

  3. If both accounts have an EO section, retain the "TO" account, unless the "TO" account doesn't have a subsection code greater than zero and the "FROM" account has a subsection code greater than zero; then retain the "FROM" account EO section.

  4. Notify Cincinnati of the EIN change if the EIN of the organization changes.

Merge Checks

  1. If both accounts have an EO section with an EO status, the BMF will perform the following merge checks. If the checks fail, a "NOMRG EO" transcript will be generated.

  2. Merge checks on the subsection (SS):

    1. If both accounts have a subsection code, they must be the same, unless one account has a SS of 00. If one account has a SS of 00, then the Master File will retain the EO section with the SS greater than zero.

    2. Before inputting a TC 011, correct the EO section that is wrong.

    3. A TC 022 may be input to delete the EO section on the account that is wrong. However, see UPC 359 in IRM 3.12.278 for TC 022 unpostable conditions.

    Note:

    TC 022 MUST be input prior to TC 011 when the account reflects Status Code 40 or Status Code 40 must be updated to match the EIN with a good determination. Input of TC 022 will remove the account from the Status 40 process.

  3. The following table shows the EO entity status which must be present so the accounts can be merged.

    Status Code"From" Module Status Code "TO" Module
    01 - 03 01 - 03
    7, 10, 11 7, 10, 11
    12 12
    18 18
    19 19
    20, 22 - 26 20, 22 - 26
    21 21
    28 28
    29 29
    30 30
    31 31
    32 32
    33 33
    34 34
    35 35
    36 36
    40 40
    42 42
    41, 70 - 72 41, 70 - 72
  4. Merge checks on the GEN:

    1. If both accounts have a GEN, they must be the same. Be sure the two accounts are the same before trying to correct the GEN.

      Examples:
      Account #1 has a GEN and Account #2 has an EO section with no GEN. These accounts will not merge because the GENs are not the same.
      Account #1 has a GEN and Account #2 has a different GEN. These accounts will not merge because the GENs are not the same.
      Account #1 has no GEN and Account #2 has no GEN. These accounts will merge because the GENs are the same.
      Account #1 has a GEN and Account #2 has the same GEN. These accounts will merge because the GENs are the same.
  5. Merge checks on the Affiliation Code:

    1. The only condition which will cause a merge to fail is when Account #1 has an AF of 7 or 9, and Account #2 has an AF of 6 or 8. You cannot merge a parent to a subordinate or a subordinate to a parent.

    2. Never input a TC 022 to the account with an AF of 6 or 8.

  6. Merge checks on the fiscal month: The fiscal months must agree. Correct the FYM on either account to agree with the posted return tax period month.

EO Transcripts and Notices

  1. AMS uses Desktop Integration (DI) to electronically deliver Entity transcripts on a weekly or monthly basis replacing the printed paper forms. The data is extracted and sorted by a computer program and cases are loaded into the DI system as inventory items. The DI system will automatically assign inventory cases to employees based on their skill codes and the number of cases in inventory. The Entity manager, lead or clerk may also manually assign transcript inventory to employees in their unit.

  2. Assigned and unassigned cases will reside on DI. The reports to track Entity's transcript inventories are also available on DI.

  3. AMS allows authorized users to resolve various taxpayer issues by providing the IRS employee the ability to view and update taxpayer accounts and case information through a common user interface. AMS can be used for may taxpayer actions and can be used whether the taxpayer's account resides on IDRS or CADE.

  4. Entity tax examiners can complete the following actions using DI/AMS:

    • Research the taxpayer account

    • Activate up to 30 self-elected IDRS Command Codes

    • Launch into external IRS system without leaving DI

    • Electronically record, store and retrieve nationwide case history

    • Update taxpayer address and phone numbers

    • Order forms

    • Prepare specific forms and transcripts

    • Create selected IDRS Correspondex letters

  5. AMS will become the remaining system/process (beginning in 2009) which will incorporate the capabilities of Desktop Integration and Correspondence Imaging System (CIS).

  6. The types of taxpayer information, correction methods, and research capabilities will continue to increase with each subsequent AMS and CADE enhancement. AMS is planning on replacing IDRS by 2012.

  7. Work all EO transcripts using the procedures outlined in IRM 3.13.12.

  8. All EO related transcripts include the following EO information. The inclusion of this information on the transcript will eliminate the need for additional EO research requests previously necessary to resolve the case.

    Title Print Format
    EO Entity Status EO–STAT–nn–YYYYMM
    Ruling Date RUL–YYYYMM
    Classification Code CLASS–nnnn
    Affiliation Code AFF–n
    Income Code INC–n
    Foundation Code FOUN–nn
    Group Exemption Number GEN–nnnn
    Type of Organization ORG–n
    Asset Code ASSET–n
    Subsection Code SUB–nn
    File Folder Number FFN–nn–nnnnnnn

General Instructions for EO Transcripts

  1. General Instructions for EO related transcripts. The table below shows EO NO MERGE Conditions.

    Figure 3.13.12-1

    Name Reason Code Definition
    Name Control 30 Different Name Controls will not merge. A CP 201 will generate
    Filing Requirements 33 Incompatible FRs will not merge. A CP 202 will generate. If the TO account is all 8s (Inactive account), a CP 200 will generate.
    EIN NOMRG - FYM Different FYMs will merge on a BMF merge, but entities with EO submodules require them to be the same MCC Transcripts are generated.
    Subsection NOMRG - SS 22 Different subsections will not merge. However, if one entity has a subsection and the other is blank, they will merge. MCC Transcripts are generated.
    GEN NOMRG - GEN 24 Different GENs will not merge. If one module has a GEN, the other module mush have the same GEN. MCC Transcripts are generated.
    STATUS NOMRG - STAT 23 All status conditions will not merge. An information table on status merges is shown in IRM 3.13.12.7.3. MCC Transcripts are generated.
    Affiliation Codes NOMRG - AF 25 Parents and subordinates should not be consolidated. An affiliation code of 6/8 will not merge with a 7/9. MCC Transcripts are generated.
    1. Perform research on all cases to determine if a true error was made, or if an error was made in transcribing the information.

    2. If the error was in transcription, make the necessary entity change following normal procedures.

    3. If a true error exists, research EDS for an open case. If there is an open case, telephone the determination agent assigned to the case. Inform the agent of the discrepancy. If necessary, forward the case to the agent assigned to the case. Notify the organization of the transfer of the case.

    4. If there is no open case on EDS, research IDRS (CC INOLE, CC BMFOLO, CC BMFOLE). If the amended organizing documents were submitted.

    5. If the amended organizing documents were submitted, send the documentation to Cincinnati campus. The notation on the Form 3499 should state "Establish as a T (termination) or A (amendment) case."

    6. If the amended organizing documents were not submitted, advise the organization of the information needed to merge the account. Request the organization send the documents to Cincinnati campus.

EO No Merge Transcripts

  1. The following transcripts are generated when an attempt to merge accounts containing EO data fails:

    • NOMRG - SS

    • NOMRG - STAT

    • NOMRG - GEN

    • NOMRG - AF

    • NOMRG - FYM

  2. No merge transcripts don't require lead approval for a TC 011.

NOMRG - SS
  1. NOMRG - SS transcript is generated when the current subsection codes are different. (RC22)

    1. Research EDS to determine if the subsection code was recently changed. If the SS was changed, request the source document to determine if the change was made correctly. If the "FROM" and "TO" accounts are the same entity, input a TC 016, Doc. Code 80, to update the subsection code and re-input the merge transaction.

    2. If it appears each account has a valid subsection code, follow the general instructions above.

NOMRG - STAT
  1. NOMRG - STAT transcript is generated when the "FROM" and "TO" accounts have incompatible EO status codes. (RC23)

    1. For incompatible status codes, see UPC 358 in IRM 3.12.278.19.

    2. Perform necessary research and make necessary changes as indicated in paragraph 12.17.2.1(1) above.

NOMRG - GEN
  1. NOMRG - GEN transcript is generated when both accounts have EO status and an attempt is made to merge accounts with different GENs. (RC24)

    1. Research CC EOGEN to determine the correct GEN. Input a TC 016, Doc. Code 80 to change the GEN when the correct GEN can be determined.

    2. If the correct GEN cannot be determined, the accounts may be different entities. One entity could be a new parent that was being erroneously merged with a subordinate. Follow the general instructions above.

NOMRG - AF
  1. NOMRG - AF transcript will generate when one account has an affiliation code of 6 or 8 (parent) and the other account has an affiliation code of 7 or 9 (subordinate). (RC25)

    1. Perform all necessary research on EDS or IDRS and make changes as required.

    2. If the NOMRG condition cannot be resolved, follow the general instructions given above.

NOMRG - FYM
  1. NOMRG - FYM transcript generates when the fiscal month for the two accounts don't agree.

    1. Research the "TO" TIN to ensure the correct number was used.

    2. If the correct "TO" TIN was used, determine the correct FYM by examining the posted returns. Use the FYM of the latest posted return for the account FYM.

      Note:

      The FYM match is performed prior to the filing requirement match. Therefore, you must be sure the FRs. of each account are compatible.

    3. After determining the correct FYM, input TC 016, Doc. Code 63 to correct the inaccurate account.

    4. If the filing requirements are mismatched, refer to CP 202 instructions in IRM 3.13.12.8.3.3 and resolve accordingly.

    5. After the FYM (and FR, if necessary) is corrected, input TC 011, Doc. Code 63 to complete the consolidation.

    6. If the correct "TO" TIN was not used, research to determine if a good "TO" TIN exists.

    7. If the proper "TO" TIN is found ensure all items (FYM, FR) are compatible. Correct if necessary, then input TC 011, Doc. Code 63 to consolidate the accounts.

    8. If you cannot find a good "TO" TIN, destroy the transcript with no further action.

No Merge Notices

  1. No Merge Notices (CPs 200, 201 and 202): Entity Control will receive these notices resulting from an attempted consolidation. These notices include the following EO information. The inclusion of this information on the notice will eliminate the need to research for EO information necessary for resolution of the case.

    Title Print Format
    EO Entity Status ST–nn–YYYYMM
    Ruling Date RUL–YYYYMM
    Affiliation Code AF–n
    Foundation Code TF–nn
    Group Exemption Number GEN–nnnn
    Subsection Code SS–nn
    File Folder Number FFN–nn–nnnnnnnn
    Classification Code CL–nnnn
CP 200
  1. CP 200 "TIN CHANGE - INACTIVE ACCOUNT" is generated when a consolidation of accounts is attempted and the "TO" account is inactive; i.e., all filing requirements are "8" .

  2. Entity Control will receive these CP 200 notices and process as follows:

    1. Research the entity using CCs NAMEE/NAMEB and INOLE to verify the accounts are the same.

    2. If the accounts appear to be the same, request research using CCs BMFOL, MFTRA, MFTRD for an entity transcript of both the "FROM" and "TO" number.

    3. If research show the accounts are the same, determine why the account is inactive by the transactions posted to the entity module. A TC 020 and a partial merge TC 011 and 003 combination will place 8s in the FRCs.

    4. Don’t reactivate an account when a TC 011 and 003 created the inactive status, unless telephone contact with the organization is made. Try to convince the organization the active number is correct. However, if the taxpayer insists on having the number which is inactive, take the necessary action to correct the BMF and redo the consolidation.

    5. To reopen the account, use TC 012 and the appropriate FRC.

    6. If the accounts are not the same, forward the case and all the research to the originator of the consolidation, if they can be determined. Explain the reason the case is being forwarded. If the originator cannot be determined, destroy the case.

CP 201
  1. CP 201, TIN CHANGE - NAME CONTROL MISMATCH is generated when a consolidation of accounts is attempted and the Name Controls don't match. Entity will receive these notices and process as follows:

    1. Perform appropriate research to determine if these accounts are for the same entity. If an error was made in transcribing the data, initiate a TC 011, Doc. Code 63 with correct data.

    2. If no error was made and it is clearly determined the accounts should be consolidated, input a TC 013 to change the name control, as required. If it's a BMF account, use Doc. Code 63; if it's an EO account, use Doc. Code 80. Also, input a TC 011 to consolidate the accounts and delay one cycle.

    3. If one account has a temporary TIN and the accounts are the same, input TC 013 to correct the name of the account which is incorrect. If the accounts are BMF, use Doc. Code 63; if the accounts are EO/BMF, use Doc. Code 80. After the TC 013 has posted, input TC 011, Doc. Code 63. Use the account with the temporary number (00–2xxxxxx) as the "FROM" account.

    4. If one account has a temporary TIN and the accounts are not the same entity, research for another number (TIN). Be sure to include EDS in your research if EO is indicated. If another TIN is found, input TC 011 using the temporary TIN as the "From" number. If another TIN isn't found, use CC ESIGN, MFI O, and NID to assign another (new) number to the account with the temporary TIN. If there is an open case on EDS, input the case control number. Input TC 011 with the temporary number as the "FROM" number.

    5. If it cannot be clearly determined how to consolidate the accounts, reject the Request for Consolidation (computer generated Form 5147 or Form 2363) with the CP 201 to the originator on a memo routing slip. Request additional information to verify the consolidation. If sufficient information is received, change the name (TC 013). Input TC 011 to consolidate the accounts.

    6. If consolidation cannot take place, destroy the notice.

CP 202
  1. CP 202, E.I. NUMBER CHANGE - FILING REQUIREMENTS MISMATCH is generated when a consolidation of accounts is attempted and the accounts have conflicting filing requirements for income returns. For example, the consolidation would result in a combination of Form 1120-C and Form 990, Form 990-PF and Form 1041-A, or Form 1120 and Form 990-T filing requirements.

    1. Determine the correct filing requirements through IDRS and additional research as necessary.

    2. If a Form 1120S is involved (Form 1120 FR of 02), correspond with the organization if one account has an unreversed TC 090 present on BMFOLE and the other account has a Form 990 FR. It will be necessary to determine from the taxpayer which FR is correct.

    3. When information reveals the filing requirement on one of the accounts is erroneous and the consolidation of the accounts should be made, coordinate with BMF Entity to reverse the TC 090, and then input a TC 016 to correct the filing requirements. Also, input and cycle delay a TC 011 to consolidate the accounts and delay two cycles.

    4. When information reveals two different entities are involved and the consolidation should NOT be accomplished, review both accounts. Correct name lines as applicable.

  2. Refer to table below to determine incompatible filing requirements:

    Filing Requirement Code & MFT Incompatible Filing Requirements & Filing Requirement Code
    02 (1120) 1041, 1065, 706GS(T), 1041-A, 5227, 1066
    990-C/1120-C (FRC = 1 unless F1120 FRC = 07)
    990-T (FRC = 1 unless F1120 FRC = 03, 04 or 09)
    990-T (FRC = 2)
    990-PF (FRC = 1 unless EO Entity Status = 19 or 22)
    990 (FRC = 03 or 07)
    990 (FRC = 04, 06 or 13 unless F1120 FRC = 09)
    990 (FRC = 01 or 02 unless F1120 FRC = 01 and EO subsection = 12 or 15 or F1120 FRC = 03, 04 or 09)
    8752 (unless F1120 FRC = 02)
    05 (1041) 1120, 1065, 990-C, 1120-C 990-T, 1066, 8752
    990 (FRC = 03 - 07)
    990 (FRC = 01 - 02 unless EO Subsection = 91)
    990-PF (unless EO Subsection = 92)
    06 (1065) 1120, 1041, 1066, 990-C, 1120-C, 990–T, 1041-A, 5227, 4720 990-PF, 706GS(T)
    07 (1066) 1120, 1065, 1041, 8752, 990-C, 1120-C, 990-T, 1041-A, 5227, 4720, 990-PF, 990, 942, 706GS(T)
    15 (8752) 1041, 1066, 990-C, 1120-C, 990-T, 1041-A, 5227, 706GS(T) & 1120 (unless FRC = 02)
    33 (990-C 1120-C) 1041, 1065, 1066, 8752, 990-T, 1041-A, 5227, 4720, 990-PF, 990, 942, 706GS(T), 1120 (unless FRC = 07 and 990-C 1120-C FRC = 1)
    34 (990-T) 1041, 1065, 1066, 8752, 990-C, 1120-C, 1041-A, 5227, 706GS(T), 990 (FRC = 03), 1120 (FRC = 01, 02, 06, 07, 10, 11 or 14 - 19)
    36 (1041-A) 1066, 8752, 1120, 1065, 990-C, 1120-C, 990-T, 990-PF, 990
    37 (5227) 1120, 1065, 1066, 8752, 990-C, 1120-C, 990-T, 990-PF, 990, 1041, 706GS(T) (unless EO Subsection = 90)
    44 (990-PF) 1065, 1066, 8752, 990-C, 1120-C, 1041-A, 5227 990
    1120 (FRC = 01 unless EO Entity Status = 19 or 22)
    1120 (FRC = 02, 06, 10, 11 14 - 19)
    1041/706GS(T) (unless EO Subsection = 92)
    990-T (FRC = 02)
    50 (4720) 1065, 1066, 8752, 990- C, 1120-C
    1120 (FRC = 02, 06, 07, 10 or 11)
    990 (FRC = 03)
    67 (990) 1065, 1066, 8752, 990-C, 1120-C, 1041-A, 5227, 990-PF
    1120 (FRC = 02, 06, 07, 10, 11, 14 -19)
    1120 (unless FRC = 09 and SS - 15)
    1041/706GS(T) (unless EO Subsection = 91)
    1120 (FRC = 01 unless 990 FRC = 01 or 02 and EO Subsection = 12)
    990-T (FRC = 02)
    990-T (Subsection = 91)
    77 (706GS(T)) 8752, 990-C, 1120-C, 990-T, 1066, 1120, 1065
    990 (FRC = 3, 04, 06, 07, 13)
    990 (FRC = 01 or 02 unless EO Subsection = 91)
    990-PF (unless EO Subsection = 92)

EO Unprocessable Returns and Documents

  1. In order for a return or document to be processable, it must have:

    • A TIN,

    • A legible name or name control,

    • A valid tax year ending, and

    • legible tax data.

  2. Returns and documents which don't meet the above requirements are called unprocessable returns or documents. "Unprocessables" received by Entity Control don't have a TIN or show a changed TIN or name.

  3. See IRM 3.30.123, Processing Timeliness: Cycles, Criteria, and Critical Dates, for Entity Control's processing time frames for unprocessable returns. All Forms 990-T, 990-PF and 5227 not processed by Program Completion Date (PCD) must have a TC 599 cc 018 input to prevent return delinquency investigations. Input of this transaction code must be completed three weeks prior to each return's delinquency check. See the delinquency check schedule in IRM 3.30.123 - Exhibit 13 for the cycle of each form's delinquency check.

  4. All BMF returns and documents must be controlled for accountability. The Batch Profile Report is used to control and identify cases in Entity Control.

  5. Original returns and documents which are unprocessable will be received from:

    • Receipt and Control,

      Exception:

      A tax examiner from Entity will go to the Deposit Activity in Receipt and Control as needed to assign EINs to returns with remittances or remittances with no return or document attached. This is to avoid sending the money to Unidentified in Accounting.

    • Document Perfection (unnumbered returns), and

    • Rejects (IDRS Control)

  6. Copies of page 1 of returns and documents that indicate a change in name or an address for EO accounts that affect the name lines will be received from:

    • Document Perfection,

    • Error Correction, and

    • Rejects.

  7. EO returns will error when the input name control doesn't match the name control on the Entity Index File (EIF). Error Correction or Rejects will perform research to determine if the organization is using the correct EIN.

  8. To make unprocessable returns processable, it may be necessary to edit entity information on the return. Refer to IRM 3.11.12 Exhibits for the placement of the edited information on each specific return.

    1. For Form 990, see Exhibit 3.11.12-1.

    2. For Schedule A, see Exhibit 3.11.12-2.

    3. For Form 990-EZ, see Exhibit 3.11.12-4.

    4. For Form 990-PF, see Exhibit 3.11.12-9.

    5. For Form 990-T, see Exhibit 3.11.12-12.

General Instructions for Processing Documents from ERS or Rejects

  1. If Error Correction or Rejects determines the EIN is for the same organization, but the Exempt Organization isn't name controlled properly, a copy of the first page of the return and any research will be forwarded to Entity Control. Process the photocopy of the return as follows:

    1. Compare the way the organization shows the name on the return with the name as shown on BMF.

    2. If the name control on the BMF isn't according to acceptable name control procedures, input the correct name control to update the BMF.

    3. If the business name isn't identified on the BMF as a sort name, input the sort name in the sort name field to correct the BMF.

    4. If there are misspelled names on the BMF, input the changes in the correct name line fields to correct the BMF.

    5. If it is obvious the BMF is correct, destroy the photocopy of the return and take no action.

    6. If appears a name change has occurred, correspond with the taxpayer, informing them documentation is required before we can make the name change. IRM 3.13.12.6.2.2 for more details on what type of documentation is required for each type of organization. If the taxpayer responds with the required information, input TC 013, Doc. Code 63, and send the organization a 252C Letter acknowledging the change to its name. If the taxpayer doesn't provide the necessary documentation or fails to respond, don't make the name change. Destroy the photocopy received from Error Correction or Rejects.

  2. If ERS is unable to determine the correct EIN to post a TC 610 payment from Form 3224E (RRPS Electronic Payment Voucher), research CC NAMEE and CC NAMEE/NAMEB. If the correct EIN is still not found, attempt to phone the bank or the organization based on the information given on the check. When the correct EIN is found, notate it on the document and send it back to ERS.

  3. Other reasons Rejects or ERS will refer copies of the return to Entity are:

    • 2 EINs

    • Missing EINs

    • Address changes

    • Incorrect subsection

    • Incorrect FYM

  4. After the changes are input, notify the Exempt Organization with a 252C letter if a change is made to the organization's name. If a correct EIN is found, notify the organization, using Letter 3910C.

    Note:

    Obvious transposed or missing digits can be excluded as criteria for sending the Letter 3910C.

General Instructions for Processing Documents from Document Perfection

  1. Returns with no entity data; i.e., name, EIN, SSN, may be forwarded to Entity from Document Perfection.

    1. Review the form for a legible name on the signature line, schedules, or any attached correspondence.

    2. Use available resources to locate a valid telephone number for the name secured. Contact the organization, and, if sufficient information is provided, perfect the return and continue processing.

    3. If the return cannot be identified in any manner, see your Manager for disposition of the form.

  2. Process Forms 8872 as follows:

    If Then
    There is no EIN, Research for an existing EIN.
    An existing EIN is found,
    1. Send a 3910C Letter to the organization to notify them of their correct EIN.

    2. Send the Form 8872 to Imaging.

  3. Entity Control will receive EO returns and documents if they contain a change to "Organization Name" , have a missing EIN or don't have an EO section on the BMF (UPC 366). Each return will be treated separately within this section.

  4. Always input TC 599 cc 018 if return is past due. A return is considered timely if filed by the due date or the extended due date. ( Extended due date is identified by approved TC 460 date.) See the following chart for return due dates.

    Exception:

    Don’t input TC 599 cc 018 if the account is in Status 40. Always input TC 599 cc 018 if the return is a Form 1120, regardless of the due date. Don’t input TC 599 cc 018 on a final return if the return FY is different from the BMF FY.

    Statute Returns Date Due, or # of months due after the end of the accounting year
    990-BL, 990-C/1120-C, 990-PF, 990-T, (IRC 401/408) 990-T (all others) 1120-POL, 4720, 5227, 6069 4.5 months 8.5 months 4.5 months 3.5 months 4.5 months 2.5 months same as 990, 990-EZ, 990-PF April 15th 4.5 months
    Non-Statute Returns Date Due, or # of Months Due After the End of the Accounting Year
    990, 990-EZ, 990-BL w/o Sch A 1041-A, 5578, 5768, 8282 4.5 months 4.5 months 4.5 months April 15th 4.5 months any time within 125 days of disposition

General Instructions for Processing Documents or Returns from Cincinnati

  1. The EO Entity Unit sends returns and documents to Cincinnati for resolution. When Cincinnati returns these documents to Entity with resolution instructions indicated, process as follows:

    1. Perform actions indicated by Cincinnati.

    2. If a return is unpostable and needs to be processed, prepare Form 3893 to recreate the original DLN on SCCF. Send the Form 3893 and the return to Data Control Unit in the Accounting Branch.

Form 7004

  1. See IRM 3.13.2 for processing instructions.

Form 2758

  1. See IRM 3.13.2 for processing instructions.

Form 8822-B

  1. Form 8822-B is used by organizations to request a name or address change.

  2. Once actions are completed, destroy per local procedures.

  3. When a Form 8822-B is submitted, update the account according to the following:

    Figure 3.13.12-2

    Form 8822-B Instructions

    If Then
    Form 8822-B clearly indicates a primary name change (FKA, previous name, etc), and required documentation is attached and form is signed by an authorized person Change the name
    Form 8822-B clearly indicates a primary name change (FKA, previous name, etc), and required documentation isn’t attached and form isn’t signed by an authorized person Correspond for verification using an appropriate letter.
    Unable to determine if the taxpayer is changing their name, Don’t update the taxpayer’s name. Update the address as needed. Send the appropriate letter after updating address instructing the taxpayer to verify the name change.
    Any required information is missing, including signature Return Form 8822-B to the taxpayer with the appropriate letter. Send the letter to the taxpayer’s “new” address. Instruct the taxpayer to complete Form 8822-B and return to us.
    You are speaking with the taxpayer by telephone discussing any issue and the taxpayer requests an address change, Change the address(es),
    The EIN on Form 8822-B isn't on the Master File and IDRS research shows the EIN was assigned to the taxpayer reflected on Form 8822-B Input TC 000. If possible to determine add correct subsection and filing requirements.
    The EIN on Form 8822-B isn't on the Master File and IDRS research shows no record of this or any other EIN being assigned, Send the taxpayer a letter without an EIN asking for a copy of the notice assigning the EIN. When response is received, TC 000 the EIN.
    The EIN on Form 8822-B doesn't match Master File and IDRS research locates a valid EIN, Notify the TP of the correct EIN with the appropriate letter. Provide the incorrect EIN, but DON”T disclose the name on the incorrect EIN.
    Form 8822-B is complete and all required fields are completed, Input the necessary transactions to update the account.

Form 8868

  1. Form 8868, Application for Extension of Time to File an Exempt Organization Return, is used to request an extension for:

    • Form 990

    • Form 990BL

    • Form 990-EZ

    • Form 990-PF

    • Form 990-T (corporation)

    • Form 990-T (IRC 401(a) or 408(a) trusts)

    • Form 990-T (501(c) trusts)

    • Form 1041-A

    • Form 4720

    • Form 5227

    • Form 6069

    • Form 8870

  2. The organization can use Form 8868 to request an automatic extension for 3 months (6 month for Form 990-T corporation) on the initial request. A second 3 month extension may be requested but isn't automatic.

  3. Don’t update name or address from Form 8868.

  4. The MFT for this extension is determined by the type of return for which Form 8868 was filed.

  5. Process Forms 8868 received in Entity as UPC 329 or UPC 366 using instructions in IRM 3.12.278.

  6. When a Form 8868 is received from Rejects because of a discrepancy with the name control, FYM, etc., and research indicates the TIN is without an EO section, make the necessary corrections and input Status 40 with CCs EOREQ/EOCHG, TC 016, Doc. Code 80, Definer Code B, Status 40/date, and Remarks for Forms 990, 990BL, 990-EZ, 990-PF, 990-T (corporation), 990-T (501(c) trusts), and 4720. For Form 990-T (IRC 401(a) or 408(a) trusts), update the filing requirement to 2. For Form 1041-A and Form 5227, update the EO Status to 12.

  7. When unnumbered Forms 8868 are received which don't contain an EIN:

    1. Research IDRS to get the EIN, edit the EIN onto the Form 8868 and forward for processing.

    2. If the account doesn't contain EO section data, input Status 40.

    3. If no EIN is located, assign the EIN in the usual manner and forward for processing.

    4. Always input Return ID Code of E8.

  8. Approved Forms 8868 for a group will be identified in Code & Edit and a TC 460 will be input on the group and each of the subordinates in the group if a listing of the names and EINs of the subordinates is attached to the Form 8868. If the Form 8868 is received in Entity from Code & Edit, research CC INOLE to determine if the extension is for a group return:

    If Then
    The Form 8868 isn't for a group return, Circle out the GEN and return to Code & Edit.
    The Form 8868 is for a group return (the GEN is present and the Form 990 FR is 03), but the "whole group" or "partial group" box isn't checked:
    1. Call the parent organization using the phone number on the SGRI listing.

    2. If contact by phone is made, ask the parent organization if the extension is for the "whole group" or "partial group." If the extension is for the "whole group," make a copy of the SGRI, mark the "whole group" box on the Form 8868 and return the extension to Code & Edit. If the extension is for a "partial group," request a list from the organization. When the list is received, attach the list to the extension, mark the "partial group" box on the Form 8868, input a TC 460 on each EIN and return the extension and list to Code & Edit. If the parent organization doesn't send in a list, request the SGRI from the Lead or designated assistant, mark the "whole group" box on the Form 8868 and return the extension to Code & Edit.

    If the Form 8868 is for a group return, the "whole group" box is checked, but no listing is attached:
    1. Annotate Group Return across the top of the Form 8868.

    2. Request the SGRI from the Lead or designated assistant

    3. Attach the copy of the SGRI to the Form 8868 and return both to Code & Edit.

    If the Form 8868 is for a group return, the "partial group" box is checked, but no listing is attached:
    1. Call the parent organization using the phone number on the SGRI listing.

    2. If contact with the parent organization is made, request a partial group list. When the list is received, attach the list to the Form 8868, input a TC 460 for each subordinate on the list and return both to Rejects. If no list is received, circle out the "partial group" box, mark the "whole group" box, request the SGRI from the Lead or designated assistant, attach the copy of the SGRI to the Form 8868, and return both to Code & Edit.

    Note:

    If there is no SGRI file available, ask the Lead to extract a list from QMF. If no QMF information is available, use CC EOGENS and print a list of the subordinates excluding those subordinates in Status 26 or Status 28.

Form 990 and Form 990-EZ

  1. Form 990 and 990 -EZ contains the following schedules: They are:

    • Schedule A - Public Charity Status and Public Support

    • Schedule B - Schedule of Contributors

    • Schedule C - Political Campaign and Lobbying Activities

    • Schedule D - Supplemental Financial Statements

    • Schedule E - Schools

    • Schedule F - Statement of Activities Outside the United States

    • Schedule G - Supplemental Information Regarding Fund Raising or Gaming Activities

    • Schedule H - Hospitals

    • Schedule I - Grants and other Assistance to Organizations, Governments, and Individuals in the US

    • Schedule J - Compensation Information

    • Schedule K - Supplemental Information on Tax Exempt Bonds

    • Schedule L - Transactions with Interested Persons

    • Schedule M - Non - Cash Contributors

    • Schedule N - Liquidation, Termination, Dissolution or Significant Disposition of Assets

    • Schedule O - Supplemental Information to Form 990

    • Schedule R - Related Organizations and Unrelated Partnerships

  2. Form 990/Form 990-EZ is filed by an organization which is exempt under IRC 501(c), or is a Nonexempt Charitable Trust under IRC 4947(a)(1). The entity subsection code for these filers is as follows:

    Code SS Description
    02 501(c)(2) Title holding corporation
    03 501(c)(3) Charitable, educational, or literary organization, an organization to prevent cruelty to animals or children, an organization for public safety testing, a religious or scientific organization
    04 501(c)(4) Civil League, local association of employees’ social welfare organization, homeowner's association
    05 501(c)(5) Agriculture, horticulture or labor organization
    06 501(c)(6) Board of trade, business league, chamber of commerce or real estate board
    07 501(c)(7) Pleasure, recreational or social club
    08 501(c)(8) Fraternal beneficiary, society, order or association
    09 501(c)(9) Voluntary employee’s beneficiary association
    10 501(c)(10) Domestic fraternal societies and association
    11 501(c)(11) Teacher’s retirement fund association
    12 501(c)(12) Benevolent life insurance association, a mutual ditch or irrigation company, a mutual or cooperative telephone company
    13 501(c)(13) Burial association or cemetery company
    14 501(c)(14) Credit union, other mutual corporation or association
    15 501(c)(15) Mutual insurance company or association (other than life or marine)
    16 501(c)(16) Corporation financing crop operation
    17 501(c)(17) Supplemental unemployment compensation trust or plan
    18 501(c)(18) Employee funded pension trust (created before 6/25/59)
    19 501(c)(19) Post or organization of war veterans
    20 501(c)(20) Legal service
    22 501(c)(22) Multi-employer pension plan
    23 501(c)(23) Veterans Association founded prior to 1880
    25 501(c)(25) Title-holding Corporations or Trusts with multiple parents
    26 501(c)(26) State-sponsored high-risk health insurance organization
    27 501(c)(27) State-sponsored workers’ compensation reinsurance
    28 501(c)(28) National Railroad Retirement Investment Trust
    29 501(c)(29) State Health Insurance Company
    50 501(e) Cooperative hospital service organizations
    60 501(f) Cooperative service organizations of operating educational organizations
    70 501(k) Child care center
    71 501(n) Charitable risk pool
    82 527 Political organizations
    91 4947(a)(1) Non-exempt charitable trust under IRC 4947(a)(1)
  3. Always edit the correct subsection from IDRS. If the account is in Status 40, leave the subsection on the return as indicated by the organization.

  4. The subsection code, foundation code, annual returns and supplementary returns for Form 990 filers are as follows:

    Subsection Code Foundation Code Annual Return Supplementary Return IRC
    02 Form 990/990-EZ and Sch B Form 990-T 501(c)(2)
    03 10 Form 990/990-EZ and Sch A, B,C Form 990-T, 4720 501(c)(3)
    03 11 Form 990/990-EZ and Sch A, B, E Form 990-T, 4720 501(c)(3)
    03 12 Form 990/990-EZ and Sch A, B, H Form 990-T, 4720 501(c)(3)
    03 13 Form 990/990-EZ and Sch A, B Form 990-T, 4720 501(c)(3)
    03 14 Form 990/990-EZ and Sch A, B Form 990-T, 4720 501(c)(3)
    03 15 Form 990/990-EZ and Sch A, B Form 990-T, 4720 501(c)(3)
    03 16 Form 990/990-EZ and Sch A, B Form 990-T, 4720 501(c)(3)
    03 17 Form 990/990-EZ and Sch A, B Form 990-T, 4720 501(c)(3)
    03 18 Form 990/990-EZ and Sch A, B Form 990-T, 4720 501(c)(3)
    04 Form 990/990-EZ and Sch B, C Form 990-T, 4720 501(c)(4)
    05 thru 20 Form 990/990-EZ and Sch B Form 990-T 501(c)(5) thru (20)
    22 thru 27 Form 990/990-EZ and Sch B Form 990-T 501(c)(22) thru (27)
    28 Form 990/990-EZ Form 990-T 501(c)(28)
    29 Form 990 Form 990-T 501(c)(29)
    40 Form 990/990-EZ and Sch B Form 990-T 501(d)
    50 Form 990/990-EZ and Sch A, B Form 990-T 501(e)
    60 Form 990/990-EZ and Sch A, B Form 990-T 501(f)
    70 Form 990/990-EZ and Sch A, B Form 990-T 501(k)
    71 Form 990/990-EZ and Sch A, B Form 990-T 501(n)
    82 Form 990/990-EZ and Sch B Form 1120POL, 8871, 8872 527
    91 Form 990/990-EZ and Sch A, B Form 990-T, 1041, 4720 4947(a)(1)
  5. The Type of Organization (TO) Codes for Forms 990/990-EZ are as follows:

    Type of Organization Definition
    1 SS = 02-20, 22-28, 29, 50, 60, 70, 71 or 81
    3
    1. The 4947(a)(1) box is checked in Item I of the entity section.

    2. SS=91

    4 The 527 box is checked in Item I of the entity section and the SS = 82.
  6. If a group exemption number (GEN) is shown in item H(c) on the return, always use the pilot voucher to create the EO/BMF entity or to add the EO section to the BMF entity.

    Note:

    Check the SGRI to ensure the subordinate was not removed from the group ruling before creating the EO section. If the SGRI indicates the subordinate was removed but this is a final 990, use the pilot voucher to create the EO section. If this isn’t the final 990, place the account in the appropriate status..

  7. When the Form 990 FRC is 06 and the CL isn't 7, input a TC 016, Doc. Code 80, Definer Code A and update the FRC to 01.

  8. When the Form 990 FRC is 06 and the TF is 10, check Schedule A, Part I:

    If Then
    Box 1 (church) is checked, Take no action (document will unpost).
    Box 1 (church) isn't checked, Take no action (document will unpost).
  9. If the Foundation Code is 09 for a 501(c)(3) Form 990 filer, this TF is incorrect. To determine the correct foundation code, check EDS, BMFOLO or Part I on the Schedule A. Update the Master File to correct the Foundation Code. The following list indicates what the TF is for each box checked in Part I of the Schedule A:

    • Box 1 - TF 10

    • Box 2 - TF 11

    • Box 3 - TF 12

    • Box 4 - TF 12

    • Box 5 - TF 13

    • Box 6 - TF 14

    • Box 7 - TF 15

    • Box 8 - TF 15

    • Box 9 - TF 16

    • Box 10 - TF 18

    • Box 11 - TF 17

  10. Every tax-exempt political organization and newsletter fund under IRC 527 must file Forms 990, 990-EZ for the taxable year if their gross receipts are equal to or greater than $25,000.

  11. If a response is received from an organization in Status 40 claiming to be a IRC 501(c)(3) organization in Status 40 and they indicate they are exempt under the Tax Reform Act of 1969, notify the organization they still are required to file a Form 1023 per Revenue Procedure 76-34 and Revenue Ruling 73-504. If the organization doesn't file a Form 1023 after nine (9) months in Status 40, update the filing requirement to Form 990-PF, Subsection 03, Foundation Code 04, FYM as indicated on the return, with a TC 016 Doc. Code 80 Definer Codes AB.

  12. See the tables below for 990 posting and filing requirement information:

    Form 990/990-EZ /990N Posting Information
    Transaction Code Tax Class Doc Code MFT Code FRC
    150 4 90/09/89/92/93 67 01, 02,,03,06, 07,13,14
    Form 990/990-EZ/990N Filing Requirements
    Compatible Income Tax Returns FRC- 01 over $50,000 FRC - 02 $50,000 or less FRC-03 Group Return FRC-06 Church FRC-07 501(c)(1) Govt FRC-13 Religious CL Code 7 FRC-14 State or Political Sub
    IRC 501 (c), (e), (f) 990-T-1,
    1120-POL,
    1120L-03
    1120M-04
    4720
    1120-01 (SS 12)
    706GS(T) (SS 91)
    990-T-1,
    1120-POL,
    1120L-03
    1120M-04
    4720
    1120-01 (SS 12)
    706GS(T) (SS 91)
    None 990-T-1 None None None
    Update IDRS for 990/990-EZ/990N Processing
    Type of Form Assign EIN "0" if EIN not found EOREQ TC 016 EOREQ TC 016 ST01
    EIN not on the BMF no exemption X Status 40
    On the BMF no exemption Status 40
    Subordinate not on the BMF X Pilot Voucher
    Subordinate on the BMF Pilot Voucher
    Group Return not on the BMF X Pilot Voucher 990-03 FR
    Group Return on the BMF Pilot Voucher 990-03 FR
    Church NIA; hospital, school not on the BMF X Status 40 if unable to determine GEN With GEN: Pilot Voucher
    Church NIA; hospital school on the BMF Status 40 if unable to determine GEN With GEN: Pilot Voucher
    Church not on the BMF no exemption X Status 30
    Church on the BMF Status 30
    Church on the BMF exempt on the BMF 990-06 FR
    4947(a)(1) filer not on the BMF X Status 12
    4947(2)(1) filer on the BMF no exemption Status 12
    501(c)(3) Organizations with annual gross receipts of $5,000 or less Status 31
    527 Political Organizations X Status 34 Subsection 82

    Note:

    If research shows the EIN on the return is correct but not on the BMF, you will input a TC 000 when applicable instead of a TC 016.

  13. If the name line indicates the word (VEBA) Voluntary Employee Beneficiary Association or the taxpayer has indicated a subsection of "9" and/or research shows the number is for a Corporation:

    1. Don’t use the corporation EIN.

    2. Research for a different number for the VEBA using CCs NAMEB/NAMEE and INOLET.

    3. If another number isn't found, use CC ESIGN to assign a new number and put the account in Status 40.

Form 990BL and Form 6069

  1. Form 990BL is titled Information and Initial Excise Tax Return for Black Lung Benefit Trusts and Certain Related Persons under IRC 501(c)(21) of the IRC; the title of Form 6069 is Return of Excise Tax on Excess Contributions to Black Lung Benefit Trust under IRC 4953 and Computation of Section 192 Deduction.

  2. The entity will be on the BMF if an exemption is granted or an EIN assigned. However, the return doesn't post to the BMF. It is processed Non-Master File.

  3. See table below for Form 990BL and 6069 posting:

    Transaction Code Tax Class Doc Code FRC
    None 6 88 04
  4. If the return doesn't have an EIN research the BMF. See table below:

    If And Then
    an EIN is found there is an EO Section with SS 21 enter the EIN on the return and release for processing.
    the SS isn't 21 contact the taxpayer notifying them they have filed the wrong return. When a reply is received, process in accordance with taxpayer's request. If no reply is received, forward return to TEGE/CINC.
    an EIN is found without an EO section enter the EIN on the return and release for processing.
    an EIN isn't found assign an EIN with MFI "0" , enter the EIN on the return and release for processing.

Form 990-C/1120-C

  1. See IRM 3.13.2.

Form 990-N, e-Postcard

  1. Beginning in 2008, small tax-exempt organizations that were previously not required to file returns may be required to file Form 990-N, Electronic Notice (e-Postcard) for Tax - Exempt Organizations not Required to File Form 990 or 990-EZ.

  2. The Ogden Campus will receive referrals from the Call Site for tax-exempt organizations when a sub-module isn't established on Master File.

  3. All of the information to establish the account and EO sub-module (Status 01, 31, 36 or 40) must be present on the referral form received from the call site. If the referral doesn't provide the information needed to establish the sub-module and/or submit the 990-N, refer the form to the Lead who will follow-up with the Call Site and obtain the missing or incomplete information.

    Note:

    If case is in St. 97, refer to the lead.

  4. When a referral is received do the following:

    • Research Master File to ensure EIN is correct for the organization.

    • Using the information provided on the referral form, establish the subsection. For instructions to input the EO subsection refer to IRM 3.13.12.6.18.

    • Monitor the case until the subsection has posted to Master File.

    • If the referral form indicates the filer will submit their 990-N close the case following the posting of the sub-module. If the form indicates the filer wants the IRS to submit the Form 990-N on their behalf, follow the instructions below for submission of an e-Postcard.

  5. The login for the web site will be associated with just one employee's name from Entity. When the message comes up asking for confirmation of the filer, just check yes and continue input.

Submit an e-Postcard
  1. Take the following steps to submit the e-Postcard:

    1. Access the e-Postcard filing system at www.irs.gov/eo and follow the links to the 990-N filing system.

    2. On the home page of the filing system, sign in as a returning user or Get Started if this is the first time you enter the site.

    3. Enter your assigned login ID and password and click "Log in."

    4. Add the organization’s EIN and then select the EIN you are filing for.

    5. You will see the first of two main screens for the e-Postcard. The first page will already contain the organization’s tax period, legal name and EIN. This is the information on Master File and you cannot change these fields. If you inadvertently entered the wrong EIN, add the correct EIN to correct the EIN.

    6. Answer two questions on the first page:
      " Has your organization terminated or gone out of business?" If the answer is ‘yes’ to this question, you will get a message that asks the filer to confirm that they no longer exist because a "yes" answer means that the IRS will no longer consider the organization to be tax-exempt. If the organization has terminated, you still complete the e-Postcard.
      "Are your gross receipts normally $50,000 or less?" The answer to this question must be "yes" to file the e-Postcard. If the "no" box is checked on the referral form, refer the case to the Lead for follow-up with the Call Site

    7. Click "Next Page."

    8. Enter the information requested on the second page.

    9. When you have completed both pages of the e-Postcard, click continue. You will see a page that states the e-Postcard was submitted to the IRS and the e-Postcard is pending. After approximately seven minutes you can get an update showing accepted or rejected. Once the status is updated, send a letter to the organization stating whether the Form 990-N was accepted or rejected.

    10. In addition to the error message noted above, you may encounter the following error messages:
      "The employer identification number (EIN) ‘xx-xxxxxxx’ was not found. You may have entered the EIN incorrectly. Please re-enter the EIN and try again."

  2. If the sub-module data sheet is incomplete, reject back to the originator.

    Note:

    If sub-module data sheet is for an organization which is in status 01, not all fields must be completed and should not be rejected if enough information is provided to submit the Form 990-N.

Form 990-PF

  1. This return is filed by organizations which are private foundations, or are charitable trusts treated as a private foundations under IRC 4947(a)(1).

  2. The entity subsection code for this type of filer is as follows:

    SS Description
    03 Charitable, educational or literary organizations to prevent cruelty to animals or children; organizations for public safety testing; religious or scientific organizations
    92 Non-exempt charitable trust under IRC 4947(a)(1)
  3. The type of foundation code for a Subsection 03 organization must be as follows:

    Type of Foundation Description
    02 Private Operating Foundation with an election under IRC 4940(d)(2)
    03 Private Operating Foundation
    04 Private Non-operating Foundation
  4. The Type of Organization (TO) Codes for Form 990-PF are as follows:

    Type of Organization Definition
    3 (U.S. Trust)
    6 (U.S. Foundation)
    If all of the following apply
    • the organization has a U.S. address.

    • Box D1 or D2 in the entity section isn't checked.

      Note:

      Always edit Code 3 if the 4947(a)(1) box is checked or no box is checked and SS92 is indicated.

    4 (Foreign Trust)
    7 (Foreign Foundation)
    if all of the following apply
    • the organization has a foreign address.

    • Box D1 or D2 is checked.

      Note:

      Always edit Code 4 if the 4947(a)(1) box is checked or no box is checked and SS92 is indicated.

    5 Canadian Trust, or Code 8, Canadian Foundation, if the organization has a Canadian address or a treaty between the U.S. and Canada is referenced or attached.

    Note:

    Always edit Code 5 if the 4947(a)(1) box is checked or no box is checked and SS92 is indicated.

    6 All others
  5. The gross receipts limitation doesn't apply to Form 990-PF filers.

  6. Organizations classified as Private foundations must file a Form 990-PF every year.

  7. A Form 990-PF filer must pay estimated tax starting with tax periods beginning after 12-31-1986.

  8. For 990-PF posting and filing requirements, see table below:

    Transaction Code Tax Class Doc Code MFT Code FRC
    150 4 91 44 1- Form 990-PF required to be filed.
    2- Revocation of private foundation (Status 19)
    2 - Revocation of private foundation (Trust Status 18) Form 1041 and 990-PF required to be filed.
    3 - Presumptive PF; Form 990-PF required to be filed.
  9. The following is a list of compatible income tax returns for 990-PF FRC 1:

    • Form 990-T; SS 03 filers

    • Form 1041; ST 12 IRC 4947(a)(1) filers

    • Form 1041; ST 18 revocation of private foundation trust

    • Form 1120; ST 19 revocation of private foundation corporation

  10. The following is a list of compatible income tax returns for 990-PF FRC 2:

    • Form 1120 ST 19 revocation

    • Form 1041 ST 18 revocation

  11. Use the table below for updating IDRS for Form 990-PF processing:

    Type of 990-PF Assign EIN MFI 0 if an EIN isn't found EOREQ TC 016 ST 40 EOREQ TC 016 ST 12
    EIN not on the BMF X X
    EIN on the BMF no exemption X
    EIN not on the XBMF IRC 4947(a)(1) filer X X
    EIN on the BMF Sec 4947(a)(1) filer X

    Note:

    If research shows the EIN indicated on the return is correct and not on the BMF, you will input a TC 000 instead of a TC 016.

  12. Foreign private foundations described in IRC 4948(b) are not required to apply for exemption, but are required to file Form 990-PF to pay a 4% tax on gross investment income derived from U.S. sources.

    Note:

    In the entity section of the 990-PF, these type of filers should check boxes C1 and 2.

  13. If a Form 990-PF with the 60-month termination box checked is received from Code & Edit, IRM 3.13.12.6.18.14 for EO Status 25 procedural instructions.

  14. Beginning January 2006, presumptive PFs will have a Form 990-PF FR of 3.

  15. The Pension Protection Act of 2006 requires certain supporting organizations who no longer qualify as a supporting organization to file Form 990-PF and self identify. If a Form 990-PF is received in Entity and "Notice 2008-6" or similar wording is present on the top of the form, or Item G checkbox - Initial return of a former public charity is checked, change the filing requirements from 990 to 990-PF. Use DOC code 80, Definer code A, Subsection 03, Foundation code 04, Classification Code, FYM and 990-PF FR 1.

    Note:

    If the filer indicates on the 990-PF they are a 4947(a) filer, update the account with subsection 92, status code 12 and 990-PF filing requirements.

    Note:

    Research to determine if there is an open 990 tax module. Input a TC 590 CC 075 to satisfy the module to prevent TDI notices.

Form 990-T

  1. A Form 990-T is filed by organizations which are exempt under IRC 501(c), 501(e), 501(f), and 501(k) when they have unrelated taxable business income or trusts filing under IRC 220(e), 529(a), 530(a), IRC 401(a) and IRC 408 IRA trusts (Individual Retirement Accounts).

  2. A Form 990-T is filed by tax exempt organizations who may file a Form 990 or 990-PF or are exempt from filing a Form 990 or 990-PF to claim the credit for small business health insurance premiums.

  3. Imaging will route Form 990-T with Form 8941 attached when filed to claim the 45R credit. Form 990-T with 8941 attached which are filed to claim the credit only are not imaged. When a Form 990-T is received take the following actions:

    • Research to ensure the EIN is for the organization filing the return.

    • If all Entity information is correct and the account has 990-T filing requirements, stamp the return and route to Code & Edit for processing.

    • If the account doesn't have 990-T filing requirements, establish the submodule per the following:

    • If the organization is a church, add a subsection and 990-T filing requirements using Status Code 07. Refer to IRM 3.13.12.6.18.5.

    • If the organization is a state operated university or college, add a subsection and 990-T filing requirements using Status Code 06. Refer IRM 3.13.12.6.18.4.

    • If the organization is other than a church, state operated university or college, add a subsection and 990-T filing requirements using the appropriate status code based on the subsection listed on the 990-T return. If unable to determine, use Status 40.

    • If changing the FYM and the change will result in a short period return for 2010, edit a computer condition code "Y" in red under the entity section of the 990-T. The computer condition code will allow the credit to post. The credit is only available for periods January 1, 2010 and subsequent. The computer condition code will by-pass this check.

    • When all actions are complete, stamp the return and route to Code & Edit for processing.

  4. See the instructions in IRM 3.13.12.9.13.4 whenever any of the following conditions exist:

    1. Form 990-T (1981 and subsequent) with Line G, IRC 401(a) Trust box checked or Type of Organization edited on the Form 990-T is a 3.

    2. Form 990-T (1980 and prior) and Line 8 checked (IRC 401(a) Trust) or Type of Organization edited on the Form 990-T is a 3.

    3. Form 990-T (1980 and prior) and Line 8 isn't checked but the name contains the words "Pension," "Retirement," "Welfare," "Benefit," or "Profit Sharing Plan. "

    4. If the "trust" box is checked and the name contains the words "Pension" , "Retirement" , "Welfare" , "Benefit" or "Profit Sharing Plan" , research the entity module using CCs BMFOL, ENMOD, or INOLE. If research shows the entity has an EO section, process the return as an exempt organization. If the entity doesn't have an EO section, process as a IRC 401(a) trust.

  5. Exempt organizations which file a 990-T also file a Form 990 or Form 990-PF.

    Exception:

    IRC 401(a) filers who also file a Form 5500 series return and IRC 408 IRA trust filers.

  6. If a Group Exemption Number (GEN) is shown in item "F" on the return, always use the pilot voucher to create the EO/BMF entity or to add the EO section to the BMF entity.

  7. Verify the Type of Organization (TO) Code, Box 3, is correct. This action will help prevent unpostable conditions.

    1. The TO is determined from the box checked in Item B or G of the entity section.

    2. Research CC INOLES/T for the subsection code if more than one box is checked in Item B and/or G , or no box is checked in Item G.

    3. After research always edit on TO code as follows:

      Code Description
      1 501(c) trust box checked with a U.S. address and SS 90-92
      2 501(c) trust box checked with a foreign address and SS 90-92
      3 401(a), 408(a) 408(e), 220(e), 529(a) 530 (a) or other trust box is checked (no subsection)
      4 501(c) corporation box checked with a U.S. address and SS 02-27, 50, 60, or 70
      5 501(c) corporation box checked with a foreign address and SS 02-27, 50, 60, or 70
    4. If unable to determine the Type of Organization Code, i.e., CC INOLES indicates SS of 00, edit Code 4 on the Form 990-T.

  8. For tax year 2006 only, most ITG, GE, EP and EO entities may file a Form 990-T with a Form 8913 attached to claim a refund of the excise tax imposed on local and long-distance phone services by IRC 4251. The Form 990-T may be filed for the telephone tax refund only, or a Form 990-T may be filed for other reasons as well as for the refund. For those organizations which normally don't file a Form 990-T, the return will be systematically force posted and no unpostables will generate. However, the Form 990-T will continue to unpost as UPC 301, UPC 303 and UPC 307.

  9. The Tax Technical Corrections Act of 2007, amended IRC 6104(d)(1) to require Form 990–T and related schedules, filed by IRC 501(c)(3) organizations to report unrelated business income, be made available for public inspection. This provision is effective for returns filed after August 17, 2006 the date of enactment of the Pension Protection Act of 2006.

  10. Entity will receive faxed Form 990-T from EOPC when a subsection discrepancy is identified between Master File and Form 990–T.

  11. When a Form 990-T is received from EOPC, take the following actions:

    If Then
    Form 990-T, box B indicates a SS code 501(c)(3), but Master File shows a different SS code and status code is other than 06
    1. Complete all necessary research including EDS to determine correct SS code.

    2. If research indicates a different SS code than found on the Form 990-T, edit correct SS in box B.

    3. If research indicates the SS code is incorrect on Master File, make correction to Master File. Notify EOPC Master File was updated.

    4. Fax the completed Form 990-T to the EOPC unit 620–7869, within five (5) days.

    Form 990-T, Box B indicates a SS code other than a 501(c)(3), but Master File indicates the SS code is a 501(c)(3) organization,
    1. If research determines MF is correct, edit the correct SS in Box B, on Form 990-T.

    2. If research indicates MF is incorrect, update MF with the correct SS and indicate on Form 990-T, the SS was corrected on MF.

    3. Fax the completed Form 990-T to EOPC 620–7869 within five (5) days of receipt.

  12. If a 990-T is filed to claim credits for Form 2439 take the following actions:

    If Then
    the EIN on the Form 990-T has active 1065 or 1120REIT filing requirements Research for another EIN with 990-T filing requirements.
    Another EIN with 990-T filing requirements is found through research Edit the correct EIN on the 990-T and continue processing.
    Another EIN with 990-T filing requirements isn't found Assign a new EIN and add 990-T-2 filing requirements. Notate the new EIN on the 990-T and continue processing.
Form 990-T Church Filer
  1. When the name on the return indicates it is for a church, use Status Code 07 to add the EO Section to the BMF. f If the organization's name doesn't clearly indicate a church or you are in doubt whether the organization is a church, use Status Code 40.

Form 990-T State-Operated University/College or Re-insurance Filer
  1. If a State-operated university/college or Re-insurance Company has unrelated business income, a Form 990-T should be filed. These organizations will not file for an exemption. Many of the Forms 990-T will be secured by Examination.

    1. The EO Status for this type of a filer is 06.

    2. If the return was not secured and the name doesn't indicate it is a State-operated university/college or re-insurance company, use Status 40.

  2. Refer to the table below for 990-T filing requirements:

    Transaction Code Tax Class Doc Code MFT FRC
    150 3 93 34 1 - Form 990-T required to be filed.
    2 - Form 990-T for IRC 401(a) or 408 filers
  3. Form 990-T FRC 1 is compatible with the following forms:

    • Form 990 (unless Form 990 FRC = 03)

    • Form 990-PF

    • Form 1120-POL

    • Form 4720

  4. Form 990-T FRC 2 is compatible with the following forms:

    • Form 941

    • Form 945

  5. Use the following table to update IDRS for Form 990-T processing:

    Type of Form 990-T Assign EIN MFI 0 if an EIN isn't found EOREQ TC016 ST 01 EOREQ TC016 ST 06 EOREQ TC016 ST 07 EOREQ TC016 ST 40 BNCHG TC016 990-T
    EIN not on the BMF no exemption X X
    EIN on the BMF no exemption X
    Subordinate not on the BMF X Pilot Voucher
    Subordinate on the BMF Pilot Voucher
    NIA: Such as a hospital, school etc. not on the BMF X Pilot Voucher If unable to determine GEN
    NIA: Such as a hospital, school etc. on the BMF Pilot Voucher If unable to determine GEN
    Church not on the BMF no exemption X X
    Church on the BMF no exemption X
    State University/College or Re-insurance Company on the BMF no exemption X
    401(a) Trust or Sec 408 IRA not on the BMF X X
    401(a) Trust or Sec 408 IRA on the BMF X

    Note:

    If research shows the EIN indicated on the return isn't on the BMF, you will input a TC 000 with applicable status instead of a TC 016.

Erroneous Backup Withholding
  1. If a taxpayer files a Form 990-T to claim a refund of erroneous backup withholding:

    1. Use the pilot voucher to create an EO section and process the return if a GEN is given.

    2. Process the return as an exempt organization if research shows the entity has an exemption.

    3. Input a TC 016 with Form 990-T FR of 2 if the organization isn't part of a group. If the EIN belongs to a corporation or has incompatible FRs, assign a new number.

      Note:

      Set up name with "for filing Form 990-T" on both the primary and sort name lines.

Form 990-T (IRC 401(a) and 408 IRA Trust)
  1. The organizations who file Form 990-T (401(a) and 408 IRA Trust) are part of a pension plan trust and are not required to file for an exemption. 401(a) Trust filers are identified on the return when the 401(a) trust box in Block "G" is checked. A 408 IRA will check trust and may indicate on Line B, 408, or the name will have Individual Retirement Account (IRA). However, if the organization has not checked the 401(a) box in Block "G" but the words such as "Pension," "Retirement," "Profit Sharing," or "Welfare Plan " are part of the organization name, process as a 401(a) filer.

  2. Many of the organizations who file Form 990-T (401(a)) were assigned an EIN for the pension plan. Therefore, don't assign a new number for the trust until thorough research and organization correspondence, if necessary, is done. Remember: CC INOLE with Definer T will show the BMF and EPMF accounts for this EIN.

  3. A 408 Trust Individual Retirement Account (IRA) will normally not have received an EIN.

  4. Assign a Form 990-T FRC of 2 via CC ENREQ/CC BNCHG to a Form 990-T for an IRA. Identify Forms 990-T for an IRA as follows:

    • The name on the form has the words "IRA" or "Individual Retirement Account"

    • Lines B or G have the box "IRC 408" checked.

    Note:

    When assigning EINs, see IRM 21.7.13.

  5. When a Form 990-T is unprocessable and the EIN isn't on the BMF or the EIN doesn't appear to be the correct number for the organization, process as follows:

    1. If the number isn't on the BMF and thorough research reveals the EIN was not assigned to another organization, input TC 000, Doc. Code 63 with a Form 990-T FRC of 2.

    2. On a 401(a) Trust: if the number belongs to the corporation (owner) of the pension plan, issue a new number via CC ESIGN MFI O. Use CC ENREQ or CC BNCHG with a TC 016, Doc. Code 63 and Form 990-T FRC of 2.

    3. If another EIN cannot be found or the number on the return appears to belong to another organization, issue a new number via CC ESIGN MFI O. Use CC ENREQ or CC BNCHG with Doc. Code 63, TC 016 and Form 990-T FRC of 2.

Extension for Form 990-T
  1. Form 8868 is used to file an extension by the following types of Form 990-T filers:

    • Corporations

    • IRC 401(a) or 408(a) trusts

    • Trusts other than the above

  2. A corporation filing a Form 990-T can receive an automatic 6 - month extension rather than the usual 3 - month extension of time to file.

Form 56

  1. See IRM 3.13.2 for processing instructions.

    Note:

    Processing instructions should be followed in IRM 3.13.2 with the exception of the name control. When working Form 56 for EO accounts name control instructions found in IRM 3.13.12 should be used.

Forms 940, 941/944, and 945

  1. Use Circular E for resolving questions concerning Employer’s Tax for Forms 941/944, 940 and 945, employment returns for Exempt Organizations.

  2. For processing instructions, see IRM 3.13.2.

Form 1120-C

  1. Form 1120-C is filed by Cooperative Associations.

  2. Form 1120-C can be identified by 1120-20 FR.

  3. The subsection must be 80/93 Status 12 MFT 02 and 1120-20 filing requirements.

Form 1120-H

  1. A homeowners' association which isn't exempt under 501(c)(4) and is formed to make a profit will file a yearly Form 1120-H to take advantage of certain tax benefits. These benefits allow the association to exclude exempt function income from its gross income.

  2. If a homeowners' association is non-profit and has received an official exemption as a 501(c)(4), the organization will file a yearly Form 990.

  3. If the homeowners' association has not received its official exemption but claims to be a non-profit organization and files a Form 990, it should be set up on Master File with an EO Status Code of 36 and Form 990 FR.

  4. A homeowners' association cannot switch back and forth from year to year, filing a Form 990 one year and a Form 1120-H the next year. They are either a non-profit which files a Form 990 or an association formed to make a profit and files a Form 1120-H. If a homeowners' association "switches" returns, process as follows:

    1. If the association has an official exemption, notify the organization they must file a Form 990. Force post the Form 1120-H and return the module to its original exemption.

    2. If the association doesn't have an official exemption, post the return. Correspond with the organization telling them they are either a profit or a non-profit organization and they can't switch back and forth from year to year. Since this situation will be hard to enforce because there is no official exemption, accept the return as filed.

Form 1120-POL

  1. Form 1120-POL filing profile

    1. This return is filed by a political organization, which is a party, committee, association, fund (including a separate segregated fund set up by IRC 501(c) tax exempt organizations), such as a political action committee.

    2. An IRC 501(c) tax exempt organization generally will file a Form 990 if it files a Form 1120-POL.

    3. The Form 1120-POL is filed annually and is due on the 15th day of the 3rd month after the tax year ends.

    4. The exempt function of a political organization is generally the function of influencing or attempting to influence the selection, the nomination, election, or appointment of any individual to any Federal, state, local public office.

    5. Exempt function income is the total of all amounts received from contributions of money or other property, membership dues, fees, or assessments paid by a member of a political organization, proceeds from a political fund-raising or entertainment event, or proceeds from the sale of political campaign materials, which are not received in the ordinary course of a trade or business to the extent they are segregated for use in an exempt function of the political organization.

    6. Political organization taxable income is the income for the tax year (excluding exempt function income) after deductions directly connected with the earning of gross income. Taxable income is adjusted by a deduction of $100 (newsletter funds don't apply).

    7. A political organization, other than a newsletter fund, isn't required to file Form 1120-POL if its taxable income is $100 or less before the specific deduction of $100. Newsletter funds cannot claim the specific deduction of $100.

  2. All Forms 1120-POL are not open to public inspection and will not be scanned.

  3. Refer to the table below for 1120 posting and filing requirements:

    Tax Class Doc Code MFT BO Date WP Date FY FRC
    3 10 02 Yes No Yes 03 - Life Insurance 1120L
    04 - Property & Casualty 1120PC
    09 - Political Organization 1120POL
    10 Home Owners Association 1120H
  4. Form 1120 filing requirements are incompatible with the following filing requirements:

    • 1041

    • 1065

    • 1066

    • All EO returns with few exceptions.

  5. For processing instructions for other Form 1120 returns, see IRM 3.13.2.

Form 1041-A

  1. This return is filed to report the charitable information required by IRC 6034 and the related regulations.

  2. For tax years beginning after 2006, split interest trusts as described in IRC 4947(a)(2) are not required to file Form 1041-A. Form 5227, Split Interest Trust Information Return, now meets the IRC 6034 filing requirements for split-interest trusts, However, for tax years which began before 2007, split interest trusts which have a filing obligation under IRC 6034 must file Form 1041-A.

  3. This return doesn't require an EO section on the BMF. If an EO section is present, it must be in Status 12, with a Subsection Code of 90.

  4. This return is only filed as needed, and the FRC on the BMF is established by the posting of the return.

  5. This return never takes the place of the primary return, either the Form 1041 or Form 5227.

  6. This return is filed for the following reasons:

    • The taxpayer must file Form 1041-A for a trust which claims a charitable or other deduction under IRC 642(c).

  7. A trust under 4947(a)(1) files a Form 990 or Form 990-PF and never files a Form 1041-A.

  8. To delete a 1041-A FR, input TC 591 cc 020 to the module of the last Form 1041-A filed. To recall a module from retention, if necessary, process as follows:

    1. If the module is on BMFOLV, input MFTRA specific with the EIN, MFT and tax period. This action will generate a transcript. Once the transcript is received, fill out a Form 5248 and attach it to the transcript. Send both to the Retention Clerk. After the Retention Clerk activates the module, input the TC 591 cc 020.

    2. If the module is on BMFOLI with an "R" indicator, input BMFOLB with the EIN, MFT and tax period. Wait a few days; then do a MFREQC to activate the module. Once the module is activated, input the TC 591 cc 020.

    3. If the module isn't on BMFOLV or BMFOLI, order a transcript using ESTABMZ with the appropriate EIN, tax period and MFT 36. When the transcript is received, attach it to Form 5248, and route the Form 5248 to Accounting to recover the module from Retention. When a TC 370 has posted, input TC 591 cc 020.

  9. Refer to table below for 1041-A posting and filing requirements:

    Transaction Code Tax Class Doc Code MFT FRC
    150 4 81 36 Computer generated when the return posts.
  10. Refer to the table below for updating IDRS for Form 1041-A processing:

    Type of Form 1041-A Assign EIN with MFI 0 TC 000 without EO Section EO Section not required. If present must be status 12
    No EIN on return
    No EIN on EINAD
    X
    EIN not on the BMF X
    EIN on the MF X
  11. Form 1041-A is compatible with Forms 5227 and 1041.

Form 4720

  1. Form 4720 is titled Return of Certain Excise Taxes on Charities and Other Persons Under Chapters 41 and 42 of the IRC. This return is filed by an organization exempt under IRC 501(c)(3), 501(c)(4), 501(c)(29), 4947(a)(1) or 4947(a)(2). IRC 170(f)(10), 4911(a), 4912(a), 4942(a), 4943(a), 4944(a)(1), 4945(a)(1) and 4955(a)(1) 4965(a)(1), 4966(a)(1) and 664(c)(2) is BMF. IRC 4912(b), 4941(a), 4944(a)(2), 4945(a)(2), 4955(a)(2) and 4958(a), 4966(a)(2) and 4967(a) is processed as NMF.

  2. Use entity subsection code 03, 04, 29, 50, 60, 70, or 91.

  3. This return is only filed as needed as a related return to primary 990 series filer; the FRC on the BMF is established by the posting of the return.

    Note:

    If required to file, Form 4720 is due 4.5 months after the fiscal year end.

  4. Refer to the table below for Form 4720 posting and filing

  5. IRC 501(c) organizations (all subsections), IRC 501(d) organizations, state or local governmental units or their political subdivisions, and Indian tribal governments may file a Form 4720 to pay excise tax with respect to prohibited tax shelter transactions under IRC 4965.

Form 4720-A

  1. Form 4720-A is Part II-A of Form 4720. Beginning January 2013, Form 4720-A will be processed through the pipeline.

  2. Return is only filed as needed as a related return to primary 990 series filers. The FRC on the BMF is established by the posting of the return.

    Note:

    If required to file, Form 4720-A is due 4.5 months after the fiscal year end. (Same due date as Form 4720).

  3. Account is established on the SSN with a V following the numbers. If an account isn't already present on the BMF, triple "000" the account to establish. In order to triple 000 it will be necessary to use MFT 76.

  4. If EIN on return doesn't match the individual listed or is invalid and research doesn't provide a valid SSN, assign a temporary TIN to process the return.

Form 5227

  1. Form 5227, Split-Interest Trust Information Return, is filed by Non-exempt Charitable Trusts under IRC 4947(a)(2).

  2. The entity Subsection Code must be 90 with a Status of 12.

  3. Return is filed by trusts which are created for the following reasons:

    • Charitable lead trust is a trust that pays a fixed annuity or unitrust amount to a charitable organization for a fixed number of years. Upon termination of the payments, the remainder interest is transferred to a noncharitable beneficiary.

    • Charitable remainder annuity trust is a trust under IRC 664(d)(1) that pays a fixed dollar amount, at least annually, to one or more beneficiaries, at least one of which isn't a charitable organization, for life, or for a specified number of years.

    • Charitable remainder unitrust is a trust under IRC 664(d)(2) similar to a charitable remainder annuity trust, except it pays, at least annually, a fixed percentage of the net fair market value of the trust's assets.

    • Pooled income fund is a common trust fund under IRC 642(c)(5) created and maintained by a charitable organization described in IRC 170(b)(1)(A). Donors to the fund receive a lifetime income interest and the charitable organization receives the remainder interest.

  4. The FYM for Form 5227 must be a 12, unless filing a final return.

Form 5227 - Other Filing Requirements
  1. If the trust is other than a IRC 664 trust, Form 1041 is filed separately and is required to be filed.

  2. Generally IRC 664 trust organizations are not required to file Form 1041. Check Form 5227, Question G, "Did the split interest trust have any unrelated business income?"

    1. If the organization answered "yes" to Question G, add the 1041 FR if necessary.

    2. If the organization answered "no" to Question G, check CC BMFOLI to see if the organization filed a Form 1041 for the prior year, or if there is an extension to file (TC 460) on Form 1041 for the current year. If no Form 1041 was filed for the prior year, nor an extension for the current year, remove the Form 1041 FR if it appears on Master File.

  3. A Form 1041-A must be filed for these organizations, unless the income is required to be distributed currently (income in and goes right back out).

  4. A Form 1041 never takes the place of Form 5227.

    • A Form 1041 is filed by regular taxable trusts.

    • A Form 1041-A may be filed by Form 1041 filers, whenever a charitable deduction is claimed on the return (Form 1041).

    • A Form 1041-A never takes the place of a Form 1041.

    • A Form 5227 is never filed by regular taxable trusts.

  5. Refer to the table below for Form 5227 posting and filing requirements:

    Transaction Code Tax Class Doc Code MFT Status Code
    150 4 83 37 Entity subsection code must be 90 with a status of 12
  6. See the table below for updating IDRS for Form 5227 processing:

    Type of Trusts Required Returns FRC
    • Charitable Remainder Annuity Trust under IRC 664(d)(1)

    • Charitable Remainder Unitrust under IRC 664(d)(2)

    5227 1. Form 5227 required to be filed. (Doesn't have unrelated business income.
    2. Forms 5227 and 1041 required to be filed. (Has unrelated business income)
    • Charitable Lead Trust

    • Pooled Income Funds under IRC 642(c)

    • All other IRC 4947(a)(2) Trusts

    1041 and 5227 1. Forms 5227 and 1041 required to be filed.
  7. The following is a list of compatible income tax returns for Form 5227:

    • 1041-A

    • 4720

    • 1041

  8. For additional information about trusts, see Revenue Procedure 83–32.

Form 5578

  1. Form 5578, Annual Certification of Racial Nondiscrimination for a Private School Exempt for Federal Income Tax, is filed by schools which are exempt under IRC 501(c)(3), and are not required to file a Form 990.

  2. The entity Subsection Code must be 03 with a Foundation Code of 10 or 11 when the EO Entity Status is 01-02, otherwise the EO Entity Status must be 07 or 30.

    Note:

    Place self-supporting organizations in Status 40 for which you cannot locate an exemption.

  3. Very often, filers of Form 5578 reverse the entries on lines 1 and 2. When this occurs, edit the proper name control on line 1(a) and the proper EIN on line 1(b).

  4. The entity filing Form 5578 is on line 1(a) and the EIN for the entity is on line 1(b).

  5. Under Revenue Procedure 75-50, a certification of racial nondiscrimination must be filed annually by the 15th day of the 5th month following the end of the organization’s fiscal year end. Always use the FYM indicated on IDRS.

  6. Refer to the table below for Form 5578 posting and filing requirements:

    Transaction Code Tax Class Doc Code MFT FRC
    157 9 84 67 990 must equal "01" , "02" or "06" with a Type of Foundation Code of "10" or "11"
  7. Refer to the table below for updating IDRS for Form 5578 processing for church controlled schools:

    Type of Form 5578 Assign EIN MFI "0" if an EIN isn't found EOREQ TC 016 Status 01 EOREQ TC 016 Status 30
    EIN not on the BMF no exemption X X
    EIN on the BMF no exemption X
  8. Refer to the table below for updating IDRS for Form 5578 processing for self controlled schools:

    Type of Form 5578 Assign EIN MFI "0" if an EIN isn't found EOREQ TC 016 Status 01 EOREQ TC 016 Status 40
    EIN not on the BMF no exemption X X
    EIN on the BMF unable to locate exemption X
    EIN on the BMF IF able to locate GEN Pilot Voucher

    Note:

    If research indicated the EIN on the return is correct and not on the BMF, input TC 000 with applicable status instead of TC 016.

Form 5768

  1. Form 5768, Election/Revocation of Election by an Eligible Section 501(c)(3) Organizations to Make Expenditures to Influence Legislation, is filed by an organization which is exempt under IRC 501(c)(3) and files a Form 990.

  2. The transaction posts to the entity module with the year the election is effective or revoked (the election year is shown with a TC 023 or 024) when CCs BMFOL, INOLE, or MFTRD is used for an Entity module request.

  3. Refer to the table below for Form 5768 posting and filing requirements:

    Generated Transaction Code Tax Class Doc Code MFT FRC
    024 (election)
    023 (revocation)
    9 77 00 Form 990 FRC must be present
  4. Refer to the table below for Form 5768 processing:

    Type of Form 5768 Processing
    No exemption, EIN not on the BMF Research Master File. If no EIN is found, return the Form 5768 to the organization using Letter 1224C or 3064C. Explain we must have an EIN to process Form 5768. Refer the filer to www.irs.gov for Form SS-4. Also explain the organization must be exempt to file Form 5768.
    EIN on the BMF Research EDS as applicable to determine if the organization has an application pending. If an EIN is found on Master File and the EO Section has SS 03, or an application pending, edit the EIN on Form 5768 and forward to Code & Edit for processing. If the account doesn't have an EO Section or the SS isn't 03, return the Form 5768 to the organization using Letter 1224C or 3064C. Explain we don't have a record of the exemption and cannot process the form. Refer the filer to www.irs.gov for Forms 1023/1024.

Form W- 3 from Social Security Administration

  1. Review Form W-3 and/or correspondence for an EIN:

    1. If EIN is present, perform IDRS research using all available tools. Compare this data to the data found via CC's NAMEB, NAMEE.

    2. If EIN isn't present, you must rely on the research.

  2. Review Form W-3 and/or correspondence to determine if an Entity issue is present.

    • If yes, continue with IDRS research and resolve the taxpayer's entity issue.

    • If no, forward to the proper area for resolution.

  3. If two EINs are found and taxpayer was assigned two numbers in error, consolidate EINs using CC TC011.

  4. If the Form W-3 and/or correspondence indicates the taxpayer is no longer in business take the following actions:

    • If the taxpayer has filed a final return but the filing requirement is still on the EIN, input a TC 591/020 for the first module the taxpayer will no longer be liable. Destroy the Form W-3 per local procedures.

    • If the taxpayer has filed a final return and filing requirements are not present, take no action and destroy the Form W-3 per local procedures.

    • If the taxpayer has not filed a final return, correspond using 696C letter and request final returns.

    • When requesting a final return using 696C, include the following information in an open paragraph; "We received information from the Social Security Administration (SSA) indicating you no longer have employees or are no longer in business. So we can remove your name from our mailing list for Form(s) X, please file the last return(s) for your employees. Show the last date wages were paid and mark each return final."

  5. If Form W-3 is undeliverable, research for a better address. If found mail the Form W-3 to the new address. If unable to locate, input a TC 593/082 to change the exempt organization status to 21.

Canadian Charities

  1. As described in Notice 99–47, Guidance Relating to Article XXI of the United States-Canada Income Tax Convention, and Publication 597, Information on the United States-Canada Income Tax Treaty, certain types of Canadian charities will be able to file Form 990-PF with the IRS if their U.S. sourced income is $25,000 or more for the tax year.

  2. The Canada Customs and Revenue Agency (CCRA) will provide an update for additions and deletions on a recurring basis to the IRS a listing of the Notice 99–47 charities. This list will be entered into the Exempt Organizations Determination System (EDS). A case record will be established for each charity. Personnel in Ohio and the Area Offices as well as Ogden can access the case record of each of these charities by:

    1. Selecting from the Inventory Control System Menu, option 01, Query/Update KDO Master Record and Status, and

    2. Selecting from the Update KDO Master Record, option 1, Research Only, and entering in the Search Criteria section, the Name Control or Employer Identification Number (EIN) of the charity.

      Note:

      The Status Code in the case record is 90.

  3. Canadian charities will be considered automatically exempt and don't have to apply for exemption. Although exempt, a qualifying charity will not have a favorable exempt status on Master File until it provides financial data to establish its foundation classification. Even if the charity doesn't request foundation classification, it must file a Form 990-PF. After they submit their financial data, they may be considered public charities; they would be required to file a Form 990.

  4. A Notice 99–47 charity providing financial data to establish its foundation classification will provide to Cincinnati:

    • Page 1 of Form 1023, completed and signed

    • Completed Part IV, Foundation Classification, of Form 1023

    • The charity's registration letter (Notification of Registration) from the CCRA

    • Form 8833, Treaty-Based Return Position Disclosure Under IRC 6114 or 7701(b)

  5. Cincinnati (or an Area Office) which receives and processes the request will:

    1. Establish the case on EDS as an "A" case and enter the notation "Form 8833" in the DBA line of the address.

    2. Process the foundation classification issue in the normal manner.

      Note:

      Since exempt status is automatic, Cincinnati will only process the foundation classification issue.

    3. Issue a composed letter (either favorable or adverse) on the foundation issue.

    4. Close the case on EDS.

  6. If the charity doesn't submit financial data to establish its foundation classification, the initial return submitted by the charity will unpost since no EO section is present. Process as follows:

    1. Check for Form 8833. If the form isn't present, correspond with the organization using Letter 3064C requesting the form.

    2. If the Form 8833 is attached to the return, check the top of page 1 of the return for the notation "Notice 99–47" . Thisn'tation helps identify the intent of the filer.

    3. Check EDS for a favorable case record (Status Code 90).

    4. If there is a determination case record, post the return by establishing an EO section with TC 016, Doc. Code 80, Definer Code B, and Status 40. Post the Form 990-PF and then remove the EO section with a TC 022.

    5. If there is no determination case record and no Status Code 90 record but the filer requests in the return or in an attachment to the return, a determination of foundation classification, forward a copy of the request to the EO Determination Processing Office (DPO). Post the return by establishing an EO section with Status 40, post the Form 990-PF and then remove the EO section.

    6. If there is no determination case record, no Status Code 90, and the filer doesn't request in the return or attachment to the return a determination, but the Form 8833 clearly identifies the charity as a Notice 99–47 charity, post the return by establishing an EO section with Status 40, post the Form 990-PF and then remove the EO section.

    7. If the Status Code 90 record shows the charity as revoked, don't post the return. Send the return to IRS,

    8. If the organization is supposed to file a Form 990-PF but erroneously files a Form 990, notify the charity of the error and request the correct return using Letter 3064C. If the charity provides the correct return, process as above. If the charity doesn't provide the correct return, send the return to Michael Seto as the address in g. above.

  7. If the charity submits its financial data and has its foundation classification as a private foundation, process as follows:

    1. If the EO section is established on Master File, the return will post to Master File.

    2. If the EO section has not been established and a Form 990-PF unposts, research EDS for an "A" case. If the "A" case was established and a letter issued, research the Letter Generation System to determine the foundation classification and the type of return that must be filed.

EO Miscellaneous Procedures

  1. IRM 3.13.12.10 covers procedures for Form 3499, EO Information Transmittal and the Status 40 Process.

Form 3499, EO Information Transmittal

  1. Form 3499 is used whenever EO correspondence is referred to an area outside the campus; e.g., the EO Area Office in Dallas, Cincinnati, or National Office.

Preparation of Form 3499
  1. Form 3499 is used to route documents. Three types are prepared in advance.

    1. If you are sending cases to Cincinnati which are mergers, or amendments, use the Form 3499 that has IRS TEGE, PO BOX 2508, CINCINNATI, OHIO, 45201 in the "TO" section at the top of the form. At the bottom of the form, circle action codes if necessary, check the appropriate type of case in "Remarks" , your name in the "From" section, and indicate your location, phone and date.

    2. IF the taxpayer is requesting a determination letter, use the Form 3499 that has IRS TEGE, 550 MAIN ST, RM 4024, ATTN: RECORDS UNIT, CINCINNATI, OHIO, 45201 in the "TO" section at the top of the form. At the bottom of the form, circle action codes if necessary, check the appropriate type of case in "Remarks" , your name in the "From" section, and indicate your location, phone and date.

    3. If you are forwarding a Form 1023, Form 1024, Form 8718, or Form 8734, route to IRS PO Box 12192, Covington, KY 41012. At the bottom of the form, circle action codes if necessary, check the appropriate type of case in "Remarks" , your name in the "From" section, and indicate your location, phone and date.

    4. The Lead will review all correspondence routed to the EO Area Office, Cincinnati, or National Office.

Status 40 Processing

  1. Beginning January 2010, the Status 40 processing will be automated.

  2. The CP 120 notice will replace the current 3566C. Master File will automatically generate the CP 120 notice monthly to all organizations in EO Status 40.

  3. If an organization's status isn't updated to 01, 02, 21, 31, 36, 50-55, 71 or 99 within 190 days, Master File will automatically update the account to EO Status 41 with 1120 filing requirements.

  4. Entity will receive correspondence and replies to the CP 120. If the case can be resolved with the information provided by the filer (e.g. determination letter, proof of subordinate of a group ruling, etc.) or through EDS research, update the account to the correct status.

  5. If account cannot be updated, the system will automatically update the status to 41. No further action is required. Destroy correspondence/ CP 120 per local procedures.

Correspondence

  1. Correspondence received from the taxpayer related to Exempt Organization accounts should be processed per instructions in IRM 3.13.12.11.

  2. If the filer requests a response, send the appropriate letter. Your response should read, "This is a response to your correspondence dated." If the letter isn't dated, use the postmark date. If the postmark date is unknown, use the date which is three days prior to the IRS received date.

  3. A CP 576 is issued when an EIN is assigned from a return. CP 576 requests a Form SS-4 from the taxpayer. When the SS-4 is received, input any missing additional data from the SS-4 to IDRS, use CC ESIGN modifier "U" to update the Notice Information Code. Dispose of the SS-4 per IRM 21.7.13, Assigning Employer Identification Numbers.

  4. Correspondence Imaging System (CIS) is an inventory system for scanning all Accounts Management (AM) receipts into digital images. AM works the cases from those images.

    • CIS returns are identified with "CIS Image. Don’t correspond for signature" and is stamped below the signature line of CIS is annotated on the front of the return.

    • CIS Image Prints should be handled in the same manner as original forms, documents or correspondence.

    • CIS images will be batched in correspondence.

    • EO Entity may receive CIS Images from EO Accounts and AM Call Site Assistors, when a CP 259A-259H, 425 - 431 notice, is attached to a CIS Imaged print EO return.

    • EO Entity will:

    • Follow the instructions on the routing slip.

    • Research IDRS for a TC 150, if present and the delinquency modules are satisfied, "destroy" the CIS image.

    • If the delinquency isn't satisfied, follow TDI (CP 259A-H, 425 - 431 ) procedures.

Going Out of Business or No Longer Liable

  1. Going Out of Business or No Longer Liable

    1. An EO/BMF account may inform the IRS it is no longer liable for a particular return.

    2. Use CC BMFOL or CC INOLE to get the entity and the filing requirement for the return the organization states it is no longer liable for.

    3. If the research shows the EO Status is 20 or greater, process as follows:

      If Then
      There are no EO filing requirements, Take no further action.
      There are EO filing requirements, Close account by input of a TC 591/020 via FRM 49.
    4. If research shows the EO Status is less than 20, check the current and prior year to see if the organization has filed this particular return.

      If Then
      The organization is filing the return, Send a 696C letter to the organization to file a final return.
      The organization has not been filing that return, Send a 696C letter to the organization to file a final return.
      The organization states the business never opened, Close the FR via TC 591 cc 020 and send a 696C letter.
    5. If the organization claims it isn't liable to file a Form 990 because it has gross receipts of $50,000 or less and, if it has a Form 990 FRC of 01, input TC 590 cc 020 and TC 016 to update the Form 990 FRC to 02. Updating the 990 FRC to 02 will automatically generate a CP 299 instructing the filer they are required to file an electronic 990-N.

    Note:

    Refer to IRM 3.13.12.6.2.5 for further actions or procedures.

Going into Business After Being Inactive or Change from Non-Employing to Employer

  1. Research IDRS.

    If Then
    A previously assigned EIN is located,
    1. Reactivate or update the account, as necessary.

    2. Correspond with the organization about the requirement for one EIN via Letter 3910C.

    A previously assigned EIN isn't located, Initiate correspondence via Letter 3910C, requesting a completed Form SS-4 or a copy of the EIN assignment notification.

Terminations

  1. Exempt Organization Termination: If an organization notifies the campus it is terminating its exemption, IRM 3.13.12.6.18.10 for EO Status 20 instructions.

  2. If an organization notifies the campus it is terminating or dissolving, and Articles of Dissolution are attached, determine the EO Status Code on CC INOLE/ENMOD/BMFOLO.

    1. If the EO Status Code is 01/02, determine if a final return has posted by researching CC BMFOLL for a Return Condition Code F or a TC 591 cc 020. If a final return or a TC 591 cc 020 has not posted, send a 696C to notify the organization they need to file a final return.

Status 97 Correspondence

  1. Beginning in 2010, exempt organizations who fail to file a return for three consecutive years will lose their tax exempt status. The organization will automatically be put in Status 97 on Master File.

  2. If an account is determined to be correctly revoked and has an employment code of W, remove the employment code. If the filer is filing Form 941, update the filing requirements to include 940 filing requirements.

  3. Before an organization is determined to have been erroneously revoked and updated to a good status, thorough research must be completed. The following should be considered:

    • Revocation is an ongoing process. The previous 3 years should be considered for review. For example in 2015, tax periods 2012, 2013 and 2014 are being reviewed for revocation. In addition, beginning May 2016 tax periods 2015 will be included in the revocation process.

    • When updating an account to a good status due to a consolidation or if a TC 590 is required, reference should be made to the Status 97 cycle chart below to ensure all input occurs before the next round of revocation. Failure to post all transactions will result in the account updating to Status 97.

    • Proof of electronically filed returns should be carefully reviewed. TE's should not rely on printed acceptance notices from filers but should research through the EUP to verify acceptance and timely filing of electronically filed returns.

    • Accounts should not be considered erroneously revoked if the filer contributed to the error. For example filing under another EIN not belonging to the organization. Errors related to service errors should be considered erroneously revoked.

    • Extensions are not valid for Form 990-N (e-postcard).

    Status 97 Chart
    Extract Cycle/Date Status 97 Date Tax Years 2013 2014 2015 FYMS Checked Status 97 Date 2013 2014 2015 Status 97 Date Tax Years 2014 2015 2016
    FYMS Checked
    TC 016 Date to Prevent Revocation TC 590 Input Date to Prevent Revocation
    04
    01-23-2017
    201701
    08-11
    201701
    12,01-07
    NA 11/28/2016-1/12/2017 11/28/2016-1/12/2017
    08
    02-20-2017
    201702
    09-11
    201702
    12, 01-08
    NA 1/23/2017-2/9/2017 1/23/2017-2/9/2017
    13
    3-27-2017
    201703
    10-11
    201703
    12, 01-09
    NA 2/20/2017-3/16/2017 2/20/2017-3/16/2017
    17
    04-24-2017
    201704
    11
    201704
    12, 01-10
    NA 3/27/2017-4/13/2017 3/27/2017-4/13/2017
    21
    5-22-2017
    NA 201705
    12, 01-11
    NA 4/24/2017-5/11/2017 4/24/2017-5/11/2017
    26
    6-28-2017
    NA 201706
    01-11
    201706
    12
    5/22/2017-6/15/2017 5/22/2017-6/15/2017
    30
    7-24-2017
    NA 201707
    02-07
    201707
    12, 01
    6/28/2017-7/13/2017 6/28/2017-7/13/2017
    34
    8/28/2017
    NA 201708
    03-07
    201708
    12, 01-02
    7/24/2017-8/17/2017 7/24/2017-8/17/2017
    39
    09-25/2017
    NA 201709
    04-07
    201709
    12, 01-03
    8/28/2017 - 9/14/2017 8/28/2017 - 9/14/2017
    43
    10-23-2017
    NA 201710
    05-07
    201710
    12, 01-04
    9/25/2017 - 10/12/2017 9/25/2017- 10/12/2017
    47
    11-27-2017
    NA 201711
    06-07
    201711
    12, 01-05
    10/23/2017 - 11/16/2017 10/23/2017 - 11/16/2017
    53 NA NA NA NA NA
  4. Entity may receive correspondence from organizations who believe their tax exempt status was revoked erroneously.

  5. Use the following table in determining the appropriate actions to take:

    If Then
    The organization is a subordinate in a group ruling and indicates they filed as part of a group return,
    1. Research for a group return.

    2. If a group return was filed, check the group code or list of subordinates to determine if the subordinate was included. (Group code 7 indicates all of the subordinates were included). Lists are attached to the return and can be viewed on SEIN.

    3. If the subordinate was included in the group return, update the account. To update the account it may be necessary to input a TC 022 to remove the subsection and then re-establish it in a good status to avoid unpostables. When the account is in a good status, input a TC 590/014 to indicate subordinate was included in the group return. Once account is in a good status, send a letter to the filer.

      Note:

      If the group return contains all zero, it isn't a valid return. Send a letter stating the subordinate must re-apply for tax exempt status.

    If the organization states they filed the return but under a different EIN,
    1. Research for the correct EIN.

    2. If a different EIN is found, notify the organization of their correct EIN.

      Note:

      Revocations are not necessarily considered erroneous if the filer submitted a return using an incorrect EIN.

    3. Research BRTVU and the EUP to determine if the name on the return the organization filed under the incorrect EIN matches the organization’s name.

    4. If the return clearly belongs to the organization and was filed timely, update the account to a good status.

    5. If a 990-N was filed, input a TC 590/020 for the period the return was filed. If a paper 990, 990-EZ or 990-PF was filed, route to Accounts Management to have the return re-processed to the correct EIN.

    6. If a different EIN isn't found and there is no indication the returns were filed, research SEIN to determine if the returns were received.

    7. If SEIN research indicates the returns were received prior to the due date of the return but did not post to Master File, make a copy of the return. Input a TC 594/094 on the account and send the return through for processing. Update the status to 01. Send a letter to the filer.

      Note:

      The received date on the SEIN copy must be prior to the due date of the 3rd year return. If the received date is later than the due date, notify the filer their return was received after the due date of the third consecutive year and they must submit a Form 1023 or 1024 and apply for a new determination. Do not update the status.

    8. If unable to locate a copy of the return, request copies of the returns and proof of timely filing from the filer. (i.e. an IRS letter, postmark or notice referring to the return) Instruct the filer if they cannot supply proof of timely filing they must submit Form 1023 or 1024 and apply for a new determination. Don’t update the status.

    If the filer submits copies of returns and proof of filing,
    Proof of filing is a copy of a postmark or receipt. Acceptance of electronic filing must be confirmed by checking the IRS EUP web site. Rejected returns don't constitute timely filings.
    1. Ensure the received date is prior to the due date. Edit the original due date if necessary.

    2. Update the account to status 01.

    3. Input a TC 590/020 on the 3rd year if no timely return has posted.

    4. Send a letter to the filer indicating tax-exempt status was corrected.

    If returns are received (either copies or originals) and proof of timely filing isn't included,
    1. Update any entity information.

    2. Don’t update status 97 or input a TC 599 or 594. Don’t correspond with filer unless the filer requests specific information concerning their status.

    3. Return will post in status 97.

  6. The following table includes additional information which can be used when working Status 97 correspondence.

    If And Then
    The filer states the organization should not have been revoked because they have a letter stating they are not required to file an EO return EDS/TEDS research shows the organization was given a 990-06, 990-13 or 990-14 filing requirement
    1. Update the account to status 01 and input the correct filing requirement.

    2. Send a letter to the filer.

    The filer states the organization should not have been revoked because they have a letter stating they are not required to file an EO return EDS/TEDS research doesn't show the organization was given a 990-06, 990-13 or 990-14 filing requirement Don’t update the account. Instruct the filer they must send a copy of the letter to:
    TEGE Correspondence Unit
    PO Box 2505 Room 4024
    Cincinnati, OH 45201
    The information may also be faxed to 513-263-4330.
    The filer states the organization should not have been revoked because they filed at least one return in the preceding three year period. IDRS research shows at least one return was filed for the appropriate period and, if it was for the third year, the return was timely filed
    1. Ensure the returns were timely filed.

    2. Update the account to status 01.

    3. Send a letter to the organization stating the account was updated.

    The filer states the organization should not have been revoked because they filed at least one return in the preceding three year period. IDRS research doesn't show at least one return was filed for the appropriate period or, if it was for the third year, the return was not timely filed. Refer to IRM 21.5.1.4.2.4(3) to determine timely filed returns. If necessary, correspond with the filer requesting proof of a timely filed return. If no proof is received, instruct the filer they must reapply.
    Correspondence indicates the address isn't connected with the organization Input a TC 593/032 via FRM 49.
    The filer states they should not have been revoked because they were not established for three years IDRS research shows they were not established for at least three years
    1. Research BMFOLE for the TC 016 which updated the account to Status 97. Identifiers will be TC 016 with Definer Code B, date matching status update on INOLES. If the DLN of the TC 016 contains all 9s ending in 2, 3, 4 etc., update the account to status 01. If the DLN doesn't contain 9s as stated above, do not update. TC 016 to input Status 97 was input manually by CSC.

    2. If determined the account should be updated, send letter to the filer.

    Note:

    In determining whether an organization is required to file, the established date should be used regardless of the ruling date or if the organization states they were not active.

    Filer states they have not been organized for 3 years IDRS research indicates the organization was established for at least 3 years Route the case to TE/GE adjustment unit.
    TEGE Adjustment Unit
    PO Box 2508 Rm 4010
    Cincinnati, OH 45201
    Filer provides a new or recently received (within last 3 years) determination letter Route the case to TE/GE adjustment unit.
    TEGE Adjustment Unit
    PO Box 2508 Rm 4010
    Cincinnati, OH 45201
    The account is in Status 97 the filer indicates they are no longer in business zero out the Form 1120 filing requirements. Don’t input a TC 591 or update the status to 20. If filer requests, correspond and notify them all filing requirements were closed.
    The organization indicates their FYM is other than what is indicated on Master File
    1. Research EDS to determine the FYM used to establish the organizations determination.

    2. If FYM requested by organization matches EDS update status and send letter. if returns need to be moved from one tax period to another route to Accounts Management at M/S 6552.

    3. If EDS doesn't match FYM of organization, research Master File and SEIN to determine previous filings. If organization has filed at least one timely return within the 3 year period in question, update the account to status 01. Send a letter to the filer.

    4. If unable to determine correct FYM, notify the filer they must submit an application to obtain tax exempt status. Don’t update account or change FYM.

    Organization states they attempted to file a 990-N prior deadline of the third year and were unable to do so
    1. Research the EUP to determine date and cause of the rejection.

    2. Research BMFOLE to determine if a TC 016 was input prior to the due date of the third year.

    3. If a TC 016 prior to deadline of the third year is present and the filer indicates the organization requested the Service submit the 990-N on their behalf, update the account to status 01, send the organization a letter.

      Note:

      Check AMS history for any additional information which supports the organizations information.

    4. If necessary request a copy of the reject notice which was sent to the organization.

    The organization requests to change their ruling to a church or states they are a church Route the case to TE/GE adjustment unit.
    TEGE Adjustment Unit
    PO Box 2508 Rm 4010
    Cincinnati, OH 45201
    The organization is a presumptive 990-PF filer (advance ruling period ended prior to June 2008 and the organization did not submit a Form 8734) foundation code is 04
    1. Check advance ruling date on INOLES. If all "0" research EDS.

    2. Research the second page in EDS to determine advance ruling ends date. If the date is prior to June 2008 the organization did not file a Form 8734.

    3. If the advance ruling date is all "9" then the organization was not required to file a Form 8734.

    4. This information should be used to determine what form the organization was liable for in the 3 year time frame prior to revocation.

      Note:

      All 990-PF returns were required to be filed by the due date of the third year to avoid revocation. No relief was offered for private foundations filing form 990-PF.

    Organization states they timely filed with the Virgin Islands
    1. Check the received date on the return. If received date is prior to due date of third year and is a valid IRS received date (Virgin Island received date isn't considered valid), update the status 01, send a letter to the filer.

    2. If a valid received date prior to the return due date isn't present, instruct the filer they must reapply.Don’t update the account.

    The organization is a Single Member LLC or Disregarded Entity Route to EO Determinations in CSC at the address below.
    Internal Revenue Service
    550 Main St Room 4024
    Cincinnati, OH 45202
    The organization is a government entity Send correspondence to:
    Internal Revenue Service
    TEGE Correspondence
    PO Box 2505 Room 4024
    Cincinnati, OH, 45201
    The organization states it filed as part of a group return
    1. Research to determine if a group return was filed. A group return can be identified by presence of a GEN (Group Exemption Number) and 990-03 filing requirements.

      Note:

      Parent organizations (identified by affiliation code 6 or 8) cannot file as part of the group but must file a separate return.

    2. If the subordinate doesn't have the same GEN as the group return, they cannot be included as part of the group return. Notify the organization they must reapply.

    3. If the subordinate was not included in the group return, notify the organization they must reapply for tax exempt status.

    4. The FYM of the subordinate must match the FYM of the group return. If the FYM doesn't match the FYM on the group return, update the FYM on the subordinate if included in the group return. The FYM doesn't have to match if the organization files a separate return.

    5. Research online SEIN and ensure group return filed did not contain all zeroes. If group return doesn't have any significant dollar amount (all zeroes), don't input a TC 590/014. Notify the subordinate, they must apply for tax exempt status.

    6. If the subordinate was included on the group return, and the group return was filed timely, update the account to status 01. Input a TC 590/014 following update. Send a letter to the organization.

    The organization was a subordinate in a group ruling the parent is revoked but the subordinate isn't in status 97
    1. Determine if the organization is a 501(c)(3), (9) or (17). If so the organization must apply for an individual ruling.

    2. Update a 501(c)(3), (9) or (17) to status 40. A TC 022 must be completed prior to updating the status. don't correspond with the filer but allow the CP 120 to generate.

    3. If the organizations is other than a 501(c)(3), (09) or (17) update the account to Status 36.

    Parent is requesting deletion of a subordinate from the group exemption the subordinate is in Status 97
    1. Delete the parent name from the primary name line.

    2. Use the sort name for the primary name line.

    3. Don’t take any actions to update the submodule.

    4. Respond to the parent the actions to delete the subordinate were taken.

      Note:

      Status 97 indicates no longer part of group ruling in addition to revoked.

    Organization states they are a homeowners association
    1. Remove the subsection using a TC 022.

    2. Add 1120-10 filing requirements.

    Organization states they are a state chartered credit union Master File indicates they are part of a group ruling and the parent is revoked State chartered credit unions are required to file a return. If a return has not been filed for 3 consecutive years, send a letter stating they must re-apply. If they have filed and just the parent is revoked, remove the GEN and update the account to subsection 14, classification 1 and status 36. Use current month and year for status date.
    Organization states they are a federal credit union or was ruled as a 501(c)(1) organization The account is listed on the NCUA website as a Federal Credit Union or EDS research indicates the organization was determined to be a 501(c)(1) organization Route the case to
    CSC Correspondence Unit
    PO Box 2508 Room 4010
    Cincinnati, OH, 45201
    Filer states this is a new organization requiring a new EIN provides copy of state charter, articles or incorporation or new by-laws
    1. Update the new EIN to a good status.

    2. Don’t consolidate the old and new EINs.

    3. Add the date of the charter, incorporation or new by-laws to the sort name line of the new EIN to differentiate from the previous organization.

    4. Don’t update the old EIN, remove 1120 filing requirements or request removal from the revocation list.

  7. If an organization is updated to Status 01, a letter must be sent to the filer notifying them of the correction.

  8. If an organization isn't updated, Entity will send a letter providing information for re-application.

  9. The following should be considered prior to updating an account from Status 97 to Status 01.

    • For example a calendar year filer should file at least one timely return for 201012, 201112 and 201212. If the organization is a fiscal filer with a period ending in March, then it must file at least one timely return for 201103, 201203 and 201303. The revocation process is ongoing. An organization is subject to revocation if it fails to file at least one timely return in any 3 year period.

    • If the organization did not file until the third year that began after December 31, 2006, then the third year's return had to be timely in order for the organization to avoid revocation. Calendar year Form 990 and Form 990-PF filers had to file their third year's return on or before May 17, 2010 (no relief was granted to these larger organizations). Form 990-EZ filers had to be accepted into the VCP by October 15, 2010 and Form 990-N submitters had to submit their Form 990-N by October 15, 2010. Form(s) 990, 990-EZ and 990-N can be identified by their Doc Code. Refer to Document 6209 for Doc Codes.

    • If the DLN of the extension (TC 460) is exactly the same as the DLN of the TC 150 for a 2010 return (tax period 2009), then the extension was not one filed by the organization (i.e. it isn't valid) and any return/notice filed after the normal due date is considered delinquent.

  10. If correspondence is received and research doesn't indicate this was an erroneous revocation, a letter should be sent to the filer stating they must reapply.

  11. If the taxpayer asks about the periods for which the organization is required to file a taxable return, correspond and explain the requirement begins with the effective date of revocation. Example: If an organization that is a calendar year filer is revoked effective May 17, 2010, then, unless it applies for and receives exemption retroactive to the date of revocation, it should file a taxable return for the period from May 17, 2010, through December 31, 2010, and continue filing taxable returns until it terminates or it applies for and receives exemption.

  12. If an account is updated but the TC 150 is past the due date a TC 590/020 must be input on the tax module for the third year return to stop revocation. For example, Master File indicates the return is past due but the organization provides proof of timely submission (certified mail receipt etc). Programming will only research for a timely filed return.

  13. A list of organizations updated to status 01 from status 97 should be compiled and sent to the SPP Analyst weekly.

Name Changes

  1. Change in Name on an Exempt Organization Account

    1. Any request to change a name of an EO account must be accompanied by appropriate documentation in order to be considered.

      Exception:

      If the requested name change is the same as the name on EDS or for a church, apply the change to Master file. No documentation is required.

    2. If the type of organization is a 1 on EDS or on BMFOLO, the organization is incorporated with the state. A State approved amendment to the articles of incorporation is required. In addition, the Certificate of Amendment must reflect both the old and the new name of the organization. If the name change is on the Secretary of State's web site, no documentation is required.

    3. If the type of organization is a 2 on EDS or on BMFOLO, the organization is a trust. An amendment to the trust agreement is required along with the trustee(s) signature.

    4. If the type of organization is a 5 on EDS or on BMFOLO, the organization is an unincorporated association. An amendment to the articles of association, constitution, by-laws or other organizing document is required along with signatures of at least two officers/members.

    5. If the correspondence has the appropriate documentation, or is on the Secretary of State web site, input a TC 013, Doc. 63. Send a 252C letter.

    6. If the correct documentation isn't provided, inform the organization the name change cannot be made until the required information is provided. Tell them what information is required, based on their type of organization.

    7. If necessary, change the name on the P tape.

    8. If the name change is for the sort name or DBA, it isn't necessary to request documentation. Change the sort name or DBA as requested by the filer.

    9. If a TC 013 was input within the last 60 days and a 252C letter was not sent, send one. This does not apply when working SGRI’s.

Change in Address

  1. Correspondence indicating address changes may be directed to EO Entity for necessary action. Input TC 014 Doc. Code 63.

Change in Fiscal Year End

  1. Correspondence may be received from the organization indicating their fiscal year end was erroneously changed to 12 during Form SS–4 processing. If this is the case, update the fiscal year end to the month stated by the organization.

  2. Correspondence may be received from exempt organizations requesting their FYM be changed. If the organization has not changed their FY in the past 10 years, make the requested change. If the organization has changed their FY in the past 10 years, they are required to file Form 1128. IRM 3.13.12.18 for Form 1128 procedural instructions.

  3. If the organization is corresponding on a trust account, be sure the trust is an IRC 501(a) type trust or a charitable trust described in Code IRC 4947(a)(1) before updating to a fiscal year. These are the only types of trust eligible to be on a fiscal year end.

Mergers

  1. There are three types of Exempt Organization mergers:

    • Group mergers

    • Subordinate mergers

    • Private rule mergers

Group Mergers
  1. Correspondence received for a merge of two group rulings or two groups merging and forming a new group, should be forwarded to Cincinnati. Once Cincinnati has approved the merger, they will notify EO Entity at the Ogden Submission Processing Center to input the appropriate actions.

  2. Research EDS to determine if there is an open case. If there is an open case:

    1. Forward the correspondence to the agent assigned the case.

    2. Notify the organization of the transfer of the correspondence with a 86C Letter.

  3. If there is no open case on EDS:

    1. Send the correspondence to the Cincinnati Determinations Processing Office (DPO) with a Form 3499 attached indicating to "Establish T (Termination) or A (Amendment) case" .

    2. Notify the organization of the transfer of the correspondence with a 86C letter. Also, if necessary, notify the organization amended organization documents are required to merge groups rulings; indicate the organization should send the amended organizing documents to Cincinnati campus (include Cincinnati's address).

Subordinate Mergers
  1. To merge subordinates:

    1. Determine from appropriate research if the entity data for the surviving corporation is correct. If not, correct the entity as required.

    2. Update the non-surviving account to Status 26. This will prevent future merging to consolidation to the non-surviving account. Use CC EOREQ/CC EOCHG with Doc. Code 80 TC 016 Definer Code B to update the EO Status Code to 26. The status code date should be the date of the merger if known; if not known, use the current year and month. Always input the x-reference EIN.

Individual Ruling Mergers
  1. If two organizations are merging and are not covered under a group ruling, then perform research.

    1. Determine if the entity data for the surviving corporation is correct. If not, correct the entity as required.

    2. Notify the taxpayer, using Letter 3008C, to continue to use the established taxpayer's identification number for the surviving organization, and the discontinued business should file its last returns marked "final" .

    3. If not required to file, i.e., if the FR is Form 990>02, close out the non-surviving organization's filing requirements with TC 591 cc 020

    4. Notify Cincinnati of the merger.

SGRIs

  1. Supplemental Listings Under a Group Ruling: See IRM 3.13.12.12.

Exempt Organization (EO) Select Check

  1. Inquiries Concerning EO Select Check:

    1. The correspondence may contain the following type of inquiry: organization was omitted from EO Select Check; organization's name was misspelled; organization would like to be known under another name; or alphabetization of EO Select Check placed them in the wrong location.

    2. Refer these inquiries to M/S 1110 by preparing Form 3499. Explain the reason for the referral and attach the correspondence.

Employer Identification Number (EIN) Corrections

  1. IRM 3.13.12.11.11 for correspondence procedures when a corrected Employee Identification Number (EIN) is different from the EIN provided on the return.

  2. Perform all the necessary research to determine if the EIN on the return is correct using CC NAMEB or CC NAMEE.

  3. If the EIN is correct, continue processing.

  4. If the EIN on the return isn't correct, correspond using Letter 3910C to notify the filer of their correct EIN. Use the most current address on the filer's module.

  5. The 3910C Letter doesn't need to be sent if the following conditions apply:

    1. Filer is using an SSN.

    2. The EIN is missing digits, the digits are transposed, or only one digit is incorrect excluding transposed digits.

    3. The EIN has merged with another number.

    4. The EIN was recently established with a TC 000.

    5. A 3910C Letter was previously sent to the filer.

Requests for EIN

  1. Perform all necessary research to determine if an EIN was previously assigned.

    If Then
    An EIN is located:
    1. Notify the organization of the previously assigned EIN with the 3910C letter.

    2. Update the organization's account, if necessary.

    3. If requested, refer the filer to www.irs.gov for any forms or publications.

    No EIN is located, Correspond with the organization using Letter 45C and request the completion of the enclosed Form SS–4.

No Reply to Previous EIN Application

  1. If the organization indicates they had previously applied for an EIN and received no reply, search IDRS for a previously assigned EIN.

    If Then
    Previously assigned EIN is located:
    1. Compare the address on the correspondence with address shown as a result of research.

    2. Update the account if a change in address is indicated on the correspondence.

    3. Notify the organization of the EIN assigned using Letter 3910C.

    No previously assigned EIN is located, Send Letter 45C.

Retaining Old EIN

  1. If an organization indicates they had a previous EIN and is requesting retention of this number:

    1. Follow research guidelines to determine if the organization can retain the "old" EIN; i.e., it has the same FR. If a filer indicates they are filing for tax-exempt status using an EIN which has BMF filing requirements, update the account and allow the filer to retain the old EIN.

    2. Update the organization's account per correspondence.

    3. Send a 3910C Letter if verification is requested by the organization.

  2. If the organization is notified of the assignment of a new EIN but insists on retaining the "old" EIN, process as follows:

    1. Research other EINs thoroughly on IDRS.

    2. Determine from the information if the organization can retain the "old" EIN.

    3. Update the account, if needed.

    4. Consolidate the accounts (TC 011), if necessary. A CP 209 is generated notifying the organization of the actions taken. If the consolidation isn't a full consolidation, send a 139C letter.

    5. If the organization cannot retain the EIN requested, correspond informing the organization the reasons why the new EIN must be used.

Verifying EINs for TIN Penalty/Backup Withholding Purposes

  1. Correspondence will be received requesting assistance because the organization received a notice from a bank, financial institution, or payer. Notice is sent to entities which are currently not posted or incorrectly posted to the BMF or EIN/Name Control file. These entities are creating problems for the TIN Penalty Program and if they are not added to the BMF, backup withholding may be erroneously imposed on these accounts.

  2. The majority of these cases will be accounts established on the NMF prior to 1985. Therefore, researching the EIN provided by the organization will result in no account found for that organization.

  3. If research shows nothing, don't tell the organization the number is valid just because it is in the valid range. Establish the taxpayer's account on the BMF with TC 000 with no filing requirements. If unable to establish the account with TC 000, establish the account via CC ESIGN. Suppress the notice of EIN assignment.

  4. Correspond with the organization with a 3910C Letter informing them their EIN is correct and we have corrected our record.

  5. If the notice is for an EIN assigned to another organization, assign a new EIN to that organization. Suppress the notice of EIN assignment.

  6. Correspond with the organization with a 3910C Letter informing them of their new EIN. Be sure to remind them to inform their bank or financial institution of this change.

Railroad Retirement Board

  1. Correspondence from National Office concerning the Railroad Retirement Board (RRB) will be forwarded to the Entity Control function.

  2. This correspondence provides documentation of the approval by the RRB of the employer status of the applicant.

  3. Entity Control should verify the organization is, in fact, established on Master File as a Form CT-1 and Form 941 filer.

  4. Research to determine if the organization is on Master File with a Form CT-1 filing requirement:

    1. If the organization is on the BMF with a CT-1 FR, no further action is required. Dispose of the documentation according to security guidelines.

    2. If the organization is on the BMF without a Form CT-1 FR, correspond with the organization to determine the correct filing requirement. Update the account according to the organization’s response using CC BNCHG, TC 016 and CC FTDRQ as applicable.

    3. If the organization isn't on the BMF, establish the organization using CC ESIGN, NID, with a Form CT-1 filing requirement. Notate in REMARKS>ENTITY ESTABLISHED FROM RRB DOCUMENTATION. Notify the organization of the EIN assigned using Letter 3910C. Input CC FTDRQ as applicable.

Mortgage Credit Certificate (MCC) Notification, Notice of Defeasance, and Student Loan Bond Notification Overview

  1. IRM 3.13.12.11.17 contains procedures for processing MCC notifications, Notice of Defeasance, and Student Loan Bonds.

General
  1. IRM 3.13.12.11.17.1 provides general background information about the following notifications:

    • Mortgage Credit Certificate (MCC) notification (correspondence)

    • Notice of Defeasance (correspondence)

    • Student Loan Bond notification (correspondence)

  2. The nature of work which service center personnel are expected to perform on these returns, documents and correspondence are also described in IRM 3.13.12.11.17.

Background
  1. Mortgage Credit Certificate notifications are written statements to notify the IRS that the Issuer is issuing Mortgage Credit Certificates in lieu of qualified mortgage revenue bonds. (In general, a program is a qualified mortgage credit certificate program if an Issuer elects not to issue a specified amount of qualified mortgage revenue bonds that it may otherwise issue during a calendar year.) The election should be entitled Mortgage Credit Certificate Election and must include the information specified in Temporary Regulations 1.25-4T(c)(2).

    • A separate Mortgage Credit Certificate is filed for each program.

  2. Notice of Defeasance are written statements of an irrevocable defeasance escrow established to redeem tax-exempt bonds on their earliest call date.

    • A separate Notice of Defeasance is filed for each escrow.

  3. Student Loan Bond notifications are written statements to notify the IRS that the Issuer is electing to issue a taxable bond.

  4. Entity will receive MCCs, Notice of Defeasance, and Student Loan Bond notifications from Batching. Entity will perform research, perfection and correspondence procedures. Once perfected, Entity establishes a fact of filing on Master File. The transaction will be established on CC ENMOD as a TC 971, Action Code 34X, or 314. Once complete, Entity will forward the return to files.

Amended Returns
  1. If the taxpayer files an amended return using the same EIN, process as an original.

    Note:

    At this time, these returns are processed for fact of filing purposes only. Therefore, there can be multiple Transaction Codes 971 Action Code 344/345/314 on CC ENMOD.

  2. If the lender files an amended return, correcting the EIN, Entity will input a TC 972 Action Code 34X/314 to reverse the incorrect posting. A fact of filing will then be input using the correct EIN.

  3. A Transaction Code of 972 Action Code 344/345/314 on CC ENMOD indicates the fact of filing was reversed.

Due Dates
  1. Mortgage Election Credit Certificates are due December 31st of the year in which the election is made.

  2. Notice of Defeasance are due within 90 days of the date of the establishment of the defeasance escrow.

  3. Student Loan Bond Notifications are due prior to the issuance of the taxable bond. For additional information, see temporary Regulations 301.9100-6T(c).

Remittance for MCC, Notice of Defeasance, and Student Loan Bonds
  1. MCCs, Notice of Defeasance, and Student Loan Bonds are non-remit. On occasion, remittance may be received for penalty payment. If remittance is received for a penalty payment, apply to the 20-2325 "Miscellaneous Forfeiture Receipts Account."

Signature
  1. Currently, a signature isn't required.

Entity - MCC notifications (correspondence), Notice of Defeasance, and Student Loan Bonds
  1. The following will be performed by Entity.
    Entity will:

    1. Receive documents from Batching,

    2. Perform research and perfection, and

    3. Input a fact of filing on CC ENMOD.

    Note:

    As of October 1, 2003, these instructions don't pertain to MMC Forms 8329, 8330 or 8703. Please refer to the IRM 3.13.2.35

    .

  2. A fact of filing is established by inputting the following transaction on CC ENMOD:

    • Mortgage Credit Certificate, TC 971 Action Code 344

    • Notice of Defeasance, TC 971 Action Code 345

    • Student Loan Bonds, TC 971 Action Code 314

  3. To establish a fact of filing, input a TC 971, Action Code 34X/314, using the following procedures:

    • Access CC ENMOD

    • Access CC REQ77 with the EIN on the return, MFT 00 and Tax Period 000000 on the second line, and Name Control and Entry Code on the third line

    • Input TC>971 (on the FRM77 screen)

    • Input TRANS-DT> MMDDYYYY

      Note:

      TRANS-DT is the return received date the TP indicates the MCC is for and/or the bank statements indicate the MCC is for or the return processable date, whichever is later.

    • Input TC 971/151-CD>34X or 314

    • Input Remarks: MCC, Notice of Defeasance, or Student Loan Bond (whichever is applicable)

  4. Input the following to the FRM77 screen:

    • TC>971

    • TRANS-DT>MMDDYYYY

    • TC971/151-CD>34X or 314

    • Remarks: MCC, Notice of Defeasance, or Student Loan Bond (whichever is applicable)

  5. If the lender files an amended return using the same EIN as original omission, process as an original.

    Note:

    At this time, these returns are processed for fact of filing purposes only. Therefore, there can be multiple Transaction Codes 971 Action Codes 344/345/314 on CC ENMOD.

  6. If the lender files an amended return, correcting the EIN, reverse any TC 971 Action Codes 344/345/314 on the incorrect account with a TC 972 Action Code 344/345/314 with CC REQ77/FRM77. Input TC 971 with Action Codes 344/345/314 using the correct EIN on CC ENMOD. See (2)-(5) above for fact of filing input procedures.

  7. Maintain source document (MCC and Notice of Defeasance) in input order, place in an IDRS gusset folder and send to files.

  8. The same Entity perfection criteria that applies to Tax-Exempt Bonds apply to MCC and Notice of Defeasance. NO CHANGES of any kind will be made to entity data on the Master File. See IRM 3.11.26.5 for Entity perfection procedures.

Group Rulings

  1. IRM 3.13.12.12 covers GEN file processing, assignment of GEN numbers, new group exemption letters, processing of new groups, updates to group rulings, processing SGRIs, and state-charter credit unions.

GEN File Processing

  1. The GEN file at MCC is issued to control the parent and subordinates for each Group Exemption Number. It ensures each group has only one parent.

  2. The GEN file, an internal control file at MCC of all GENs, contains the following information:

    Parent Subordinate
    EIN EIN
    Affiliation Code 6 or 8 Affiliation Code 7 or 9
    GEN GEN
    Name Control Name Control
    Cycle Posted Cycle Posted
    Organization Name
  3. Every entity change transaction which contains a NEW GEN or a FROM GEN will be passed against the GEN file.

  4. When the input Affiliation Code is 7 (state) or 9 (subordinate), the parent must be on the GEN file or it will unpost with UPC 370.

  5. When the input Affiliation Code is 6 (parent) or 8 (parent of a church), it will unpost with a UPC 370 if the input NEW GEN matches a GEN on the GEN file.

Doc. Code 80 Transactions
  1. Document Code 80 transactions containing a GEN are passed against the GEN file for GEN verification.

  2. An update record is generated to add the account to the GEN file when the transaction posts to the BMF. This update record posts to the GEN file one cycle after the TC 016 has posted to the BMF.

  3. When the GEN file updates, it posts any delete records prior to any add or change records. It is important to cycle any TC 016 transactions appropriately to allow for the GEN file to update.

Doc. Code 81 Transactions
  1. Document Code 81, TC 000 will update the GEN file and then post to the BMF.

  2. When a Doc. Code 81 with TC 016 and Definer Code A, B, C, or blank passes against the GEN file, every subordinate for that GEN will have a TC 016 generated for posting to the BMF.

  3. Definer Code D indicates every subordinate added with a TC 000, Doc. Code 81 for that GEN will have a transaction generated for posting to the BMF.

New Group Exemption Letter

  1. When an organization applies for a group exemption, Cincinnati will establish a case control on EDS for the "parent" organization. When a determination is made and the GEN assigned, the case control is closed on EDS and a Form 2363A marked "New Group Exemption Letter" is forwarded to the OSPC to create the pilot voucher. The pilot voucher will be used to establish the subordinates with complete entity data, including the EO section.

    Note:

    If the list of subordinates isn't attached and it isn't a church, reject the Form 2363A back to the originator.

  2. Cincinnati will forward the Form 2363A and a list of all subordinates to the campus for the updating of the parent and the subordinates. Form 2363A is used to create the pilot voucher.

  3. The pilot voucher will contain all the common data for the group ruling.

    Note:

    If the pilot voucher is incomplete, reject the Form 2363A back to Cincinnati for revision.

  4. All IRC 501(c)(3) organizations must have an entry in item 36, NTEE, on the Form 2363A. If there is no entry, return the Form 2363A to the originator, informing them the new GEN cannot be established until the NTEE is given.

  5. The address for Cincinnati is:
    PO Box 2505 Room 4024
    Cincinnati, OH 45201

  6. New groups must be completed and on the BMF 60 days after receipt. See IRM 3.30.123, Processing Timeliness.

Assigning of Group Exemption Number (GEN)

  1. The GEN number will be assigned by Cincinnati and marked on the 2363A.

  2. Prepare the pilot voucher for adding subordinates from the Form 2363A received Cincinnati by doing the following:

    1. Always enter Affiliation Code 9 on the pilot voucher, regardless of the type of organization.

    2. Don’t enter any address.

    3. Input a new GEN to the parent organization. IRM 3.13.12.12.4. Establish an IDRS control base in monitor status.

    4. Three cycles after assignment of the GEN, research to ensure the GEN has posted to the Master File. If the GEN has gone unpostable, refer to IRM 3.12.278, taking necessary action to resolve.

    5. Once the GEN has successfully posted to the Master File, close the control base.

    6. Using the pilot voucher, add the NEW GEN to each of the subordinates. IRM 3.13.12.12.5

    7. After processing, create an SGRI file, with the Form 2363A received from Cincinnati and the list of subordinates.

  3. After all of the above actions are taken, and the subordinates added, give the pilot voucher to the Lead for imaging the first of each quarter.

Processing New Groups - Parents

  1. When you receive the new group exemption letter from Cincinnati, the parent will be updated on the BMF from EDS. Research of the parent's EIN may be necessary to verify the EDS record has posted. Use CCs ENMOD, INOLE or BMFOL.

  2. To assign, input a TC 016, Doc. Code 80, Definer Code C to the parent's EIN with the following information:

    1. Enter Affiliation Code 6 for all parents which are not a church or exempt under IRC 501(c)(1).

    2. Enter Affiliation Code 8 for all parents of churches under IRC 501(c)(3), Foundation Code 10 or IRC 501(c)(1) organizations.

    3. RULING-DT

    4. NEW-GRP-EXEMP-NUM

    5. REMARKS

  3. Input the TC 016 immediately. The parent must be established on the BMF and the GEN file before the subordinates can be added. If this transaction is UPC 370, correct immediately.

Processing New Groups - Subordinates

  1. After the parent is updated on the BMF and the GEN file, the subordinates can be added.

    Note:

    Subordinates under IRC 501(c)(3) may have a different foundation code than the parent organization. Check for any attachments to the F2363A indicating exceptions.

    For a new group or new subordinates to a group:

    If Then
    The EIN is already on the BMF, Use CC EOREQ/CC EOCHG, Doc. Code 80, TC 016, Definer Codes ABC and the exemption data from the pilot voucher.

    Exception:

    If a potential subordinate is on the BMF but the EO Status Code is 22 or 97, don't add the organization to the group.

    The EIN isn't on the BMF, Use CC ENREQ/CC BNCHG with Doc. Code 63, TC 000 Input exemption data from the pilot voucher using EOREQ/EOCHG Doc. Code 80.
    The subordinates in the group don't have EINs, Perform research to determine if an EIN has already been established.
    The EIN is located, Proceed as above.
    Research fails to locate the EIN:
    1. Correspond with the parent informing them the subordinate organizations cannot be added because the EINs have not been supplied.

    2. Inform the parent Forms SS-4 need to be completed and returned so the EINs may be assigned.

    3. Refer the filer to www.irs.gov to obtain a Form SS-4.

  2. Enter the subordinate’s names as follows:

    1. Enter the parent’s name on the subordinate’s primary name line.

    2. If the subordinate’s name is similar to the parent’s name and is distinguished from the parent by a local number, chapter number, unit number or district number, enter the local, chapter, unit or district number on the sort name line.

    3. If the subordinate’s name is clearly different from the parent’s name, enter the subordinate’s name on the sort name line. IRM 3.13.12.6.4 for further instructions on input of sort name.

    4. Don’t set up the following organizations like the parent's name: GEN 0002 Moose International, GEN 3017 Banner Health, GEN 3297 Nami Virginia, GEN 3641 Cleveland Clinic Foundation, GEN 5269 Court Appointed Special Advocates of New Jersey, GEN 9405 Illinois PTA, and all churches and credit unions.

Using Definer Code F

  1. There are occasions when the wrong EIN was used for the parent of a group ruling. Once the EO account is on the BMF and the parent is established on the GEN file, there is no way to change the parent EIN on the GEN file except with a TC 011 to a different EIN which isn't on the GEN file.

  2. The GEN file prohibits adding another parent. An input with Affiliation Code 6 or 8 passes against the GEN file and if the GEN is already established, the input record will unpost with UPC 370.

  3. Definer Code F is used to correct the GEN file when the parent EIN is really a subordinate or has an independent ruling. For this definer code to make the change, one of the subordinates must be the parent.

Verifying of Parent and Subordinate EINs
  1. Use CCs ENMOD, BMFOL and INOLE and verify the EINs for both the subordinate and the parent have the following information:

    • The GENs must be the same.

    • The Affiliation Code on the parent must be a 6 or 8.

    • The Affiliation Code on the subordinate must be a 7 or 9.

    • The exemption data must be the same.

    • The EO Entity Status must be 01-02.

  2. Always update the BMF, if necessary, before inputting Definer Code F.

Inputting EOREQ/EOCHG Transactions
  1. Input both CC EOREQ/CC EOCHG transactions in the same cycle, if possible. Both TC 016 transactions must post within 3 cycles of each other.

  2. First, use CC EOREQ/CC EOCHG, Doc. Code 80, Definer Code F with TC 016 and the following fields:

    • Parent EIN

    • Parent name control

    • Affiliation Code (always 7 or 9)

    • From GEN

    • Remarks

  3. Next, use CC EOREQ/CC EOCHG, Doc. Code 80, Definer Code F with TC 016 and the following fields:

    • Subordinate EIN

    • Subordinate name control

    • Affiliation Code (always 6 or 8)

    • From GEN

    • Remarks

  4. The above two transactions must both arrive at the GEN file within 3 cycles or the first one will unpost with UPC 370.

  5. If the input transactions unpost, the unpostable will be 370 from the GEN file or 371 from the BMF.

Dissolving a Group Ruling

  1. There may be a time when a group ruling will be dissolved. Notification of the dissolution must come from the parent of the group. These procedures are for this type of case.

  2. If a parent of a group ruling notifies us they are dissolving the group, take the following actions:

    • If the subsection of the organization is IRC 501(c)(3), (9) (17) or (29), update all subordinates to status 40.

    • If the subsection of the organization is other than IRC 501(c)(3), (9) (17) or (29) update all subordinates to status 36 with 990 filing requirements.

      Note:

      If necessary, input a TC 022 to remove the subsection prior to placing the account in status 36 or 40.

    • Update the parent account to an individual ruling with correct filing requirements from information on EDS/TEDS removing the GEN information from the account. Manager or Lead approval isn’t required.

Parent Affiliation Code Change

  1. There are cases where the affiliation code established for the parent was wrong. This happens when a church is input with Affiliation Code of 6 and it should be an 8, or a non-church is input with an 8 and the Affiliation Code should be a 6.

  2. When a parent account is found on the BMF with an incorrect affiliation code, it must be corrected because parents with an affiliation code of 8 don't receive a Parent/Subordinate List.

  3. To change the affiliation code, the input must be as follows and no other changes can be made:

    • Doc. Code 80

    • TC 016

    • Definer Code C

    • From GEN

    • Affiliation Code 6 or 8

    • Remarks

  4. If the transaction unposts from the GEN file, it will unpost with UPC 370; if it unposts from the BMF, it will unpost with UPC 371.

Updating Group Rulings

  1. When Cincinnati or National Office amends the exempt data for a group ruling, they will forward a new Form 2363A to Ogden. Give the corrected pilot voucher to the Lead to be sent for imaging the first of each quarter.

  2. Group related correspondence must be completed 30 days after receipt. See IRM 3.30.123.

Name Change
  1. When the campus receives correspondence from the parent organization for a name change, a copy of the amendment of the name must be included with the correspondence. If missing, correspond with the organization using appropriate letter.

  2. If a copy of the amendment is attached, proceed as follows:

    1. Use CC EOREQ/CC EOCHG with Doc. Code 80 or CC ENREQ/CC BNCHG with Doc. Code 63 and TC 013 for the parent's EIN and to correct the name. Send the appropriate letter to the organization acknowledging the change to its name. Give the corrected pilot voucher to the Lead to be sent to Imaging the first of each quarter.

    2. Don’t change the names of the subordinates unless instructed to do so by the parent or updated pilot voucher. If a change to all the subordinates is indicated by the parent, use CC EOREQ/CC EOCHG with Doc. Code 80 or CC ENREQ/CC BNCHG with Doc. Code 63 and TC 013 for each subordinate and to correct the name.

      Note:

      IRM 3.13.12.12.12.4.1 before changing subordinate names.

    3. Prepare a new pilot voucher for the GEN with the changed name and the unchanged data. It should be a complete pilot voucher. IRM 3.13.12.12.3 Give the corrected pilot voucher to the Lead to be sent for imaging the first of each quarter.

    4. File the original amendment in the assigned folder.

    5. IRM 3.13.12.6.2.2 for more information.

Merging of Two Groups
  1. Correspondence received for a merger of two group rulings or two groups merging and forming a new group, should be forwarded to Cincinnati. Once Cincinnati has approved the merger, they will notify EO Entity at the Ogden Submission Processing Center to input the appropriate action.

  2. Research EDS to determine if there is an open case. If there is an open case:

    1. Forward the correspondence to the agent assigned to the case.

    2. Notify the organization of the transfer of the correspondence with a 86C Letter.

  3. IRM 3.13.12.12.12.4.10 for more information.

Other Updates
  1. For correspondence received which amends the original exempt data, other than the name, address, or FYM, forward the correspondence to Cincinnati.

  2. When a group return is filed or correspondence is received stating "All the subordinates are changing their filing month to agree with the parent" , input an update to the BMF with the following required fields:

    • Doc. Code 81

    • TC 016

    • Definer Code D

    • Parent's EIN

    • Parent's name control

    • From GEN

    • FYM as indicated on the return or correspondence

    Note:

    Add Employment Code W if it isn't present, but only on accounts which have a Form 941 or 944 filing requirements.

    Reminder:

    When updating a subordinate, always input the information exactly as shown on the pilot voucher.

List of Parent and Subsidiary Accounts

  1. A "List of Parent and Subsidiary Accounts" will be generated monthly, six months prior to the end of the parent's accounting period. This list will be used for mailing information, etc., to the organization.

  2. The list contains the EIN, name, address, group exemption number and filing requirement of the parent, and the EIN, name, address, filing requirement and status (active or inactive) of each subordinate. The subordinates are sorted by EIN within GEN.

Processing List of Parent and Subsidiary Accounts
  1. This listing isn't sent to Church organizations with AF code of 8.

  2. CP 119, Publication 892 (Group Exemption Procedures) and one copy of the List of Parent and Subsidiary Accounts are automatically generated, associated and mailed to each parent.

  3. The list is mailed to the organization no later than the 20th of the month following the extract. See IRM 3.30.123, Processing Timeliness.

Maintaining Suspense Copy
  1. A copy can be printed from QMF if a parent organization lost, destroyed or misplaced its original copy. It may also be sent to the parent if a subsidiary account received the original in error and failed to forward the listing to the parent.

  2. Maintain the suspense file for one year, then destroy in accordance with local campus disposition procedures.

List of Parent Accounts

  1. A "List of Parent Accounts" will be generated monthly, six months prior to the end of the parent's accounting period.

  2. The list contains the organizations with Affiliation Codes of 6, 7, or 8 and Status Codes less than 20.

    Note:

    If the GEN is 0229 and the Affiliation Code is 7, the organization will not appear on the list. Specific information concerning GEN 0229 can be located by using CC EOGEN.

  3. All organizations which have received a group ruling must submit supplemental group ruling information (SGRI) to the IRS at least 90 days before the end of their accounting period. Refer to Publication 1162.

Processing List of Parent Accounts
  1. The "List of Parent Accounts" is used to control the receipt and non-receipt of the organization's SGRI.

  2. The "List of Parent Accounts" isn't processed until 90 days before the end of the organization's accounting period.

  3. If the parent requests an extension of time to submit the SGRI information notify the lead. If the SGRI was not received or there is no reply, process as follows:

    1. Don’t update any subordinate accounts.

    2. Don’t make any changes based on the late SGRI. Send a letter telling the parent changes will not be made because the SGRI was received late. Changes will not be made until the following year based on a timely received SGRI.

  4. The campus may grant additional time to file any of the required statements or lists. The additional time to file may not exceed 180 days from the original due date.

  5. If the SGRI is returned undeliverable:

    1. The CP 119 notice with a copy of the SGRI is sent to the parent.

    2. If the CP 119 notice is returned undeliverable, suspend all remaining letters.

    3. Perform additional research. If a better address is found, send Letter 2475C and a copy of the SGRI to the parent.

    4. If a better address is still not found, attempt to contact three active subordinates by phone or by mail to find the current address of the parent.

    5. If a better address is found, send Letter 2475C and a copy of the SGRI to the parent.

    6. If the above attempts fail, file the undeliverable information with the SGRI which is retained in Entity.

    7. For specific instructions on processing SGRI undeliverables, IRM 3.13.12.21.3.

Supplemental Group Ruling Information (SGRI)

  1. Each year the central organization of a group ruling must submit to the OSPC a letter, SGRI, detailing changes to its subordinates.

  2. The SGRI should be received within 90 days prior to the close of the central organization's accounting period. If the organization uses the list we sent them per IRM 3.13.12.12.10, accept it as their SGRI.

  3. Enter the GEN in the upper right corner of the SGRI. If the organization doesn't provide its GEN, research IDRS. If your research leaves you uncertain of the correct GEN, request it from the central organization.

  4. To be acceptable, the SGRI must be timely and comply with Publication 1162. IRM 3.13.12.12.1.

  5. If your campus receives an SGRI from a central organization, transship the SGRI unworked to the OSPC.

  6. SGRIs must be completed 60 calendar days after receipt.

Receiving and Accepting SGRIs
  1. Review the SGRI. To be complete the SGRI must contain a statement to the effect there were no changes to its group exemption roster for the year or it must provide the following information:

    • A list of subordinates which have changed their names or addresses during the year or a statement no names or addresses were changed.

    • A list of subordinates no longer to be included in the group exemption letter or a statement no subordinates were dropped.

    • A list of subordinates to be added to the group exemption letter or a statement no new subordinates were added.

    Note:

    Some groups may indicate they don't have any subordinates at the current time but may have subordinates in the future. Since the organization had to have subordinates to obtain a group exemption, the parent can maintain the group exemption according to the Cincinnati DPO.

  2. If additions are made, this list must be accompanied by:

    • A statement the information on which the present group exemption letter was issued applies to each new subordinate

    • A statement each new subordinate has given the central organization written authorization to add its name to the roster

    • A list of new subordinates to which the IRS previously issued exemption rulings or determination letters

    • A statement none of the new subordinates are private foundations as defined in IRC 509(a), if the group is exempt under IRC 501(c)(3)

    • A statement the subordinate is complying with the requirements of Revenue Ruling 71–447, 1971–2 , if the group is exempt under IRC 501(c)(3) and the new subordinate is a school.

    Note:

    Each list must show the names, mailing address, including Postal ZIP codes, actual address, if different, and EINs of the affected subordinates. A directory of subordinates will not be accepted for this purpose.

Missing Information
  1. If any required information is missing from a list of new subordinates, correspond for the missing information with letter 3064C.

  2. If the information in IRM 3.13.12.12.12.1(1) above isn't furnished, the central organization must provide a separate statement that no change to their group exemption roster was made. Proceed as follows:

    1. Correspond if information is missing.

    2. Correspond with letter 3064C, using the appropriate selective paragraphs and the floating paragraph (*), if necessary.

  3. If the central organization doesn't provide TINs for organizations with name changes, address changes, or terminations:

    1. Research CCs NAMEB and NAMEE for the missing EINs. If the EINs are found, process the SGRI.

    2. If the EINs are not located, correspond with the parent informing them the subordinate organizations cannot be added because the EINs have not been supplied. Inform the parent Forms SS-4 need to be completed and returned so the EINs may be assigned. Refer the filer to www.irs.gov to obtain a Form SS-4.

Foreign Subordinates
  1. A subordinate which is organized and operated in a foreign country may not be included in a group exemption letter.

  2. If the SGRI has an address change to a foreign address or an addition with a foreign address:

    1. Notify the central organization these organizations may not qualify to be recognized as a subordinate to the group ruling because of the above limitation.

    2. Don’t change any subordinate's address to a foreign address or add any subordinate with a foreign address to the BMF, EO section, before corresponding with the central organization.

    3. Correspond using letter 1169O (or contact by phone) and attach Form 1023, Application for Recognition of Exemption Under IRC 501(c)(3) of the IRC, or Form 1024, Application for Recognition of Exemption Under IRC 501(a) or for Determination Under Section 120, as appropriate. Notate the SGRI of the action taken.

    4. Maintain a 45 day suspense file if corresponding with the organization.

    5. If no reply to correspondence is received, forward the SGRI and the correspondence file to Cincinnati, Determination Unit, along with an explanation of referral.

    6. When a reply is received which states the organization was organized and is operational in a foreign country, forward the SGRI and the correspondence file to Cincinnati, Determination Unit, along with an explanation of referral.

    7. If the reply states the organization was organized in the U.S. and is operating in a foreign country, the organization can be a member of the group. Continue processing.

Processing the SGRI
  1. When the SGRI is complete or when correspondence is received which makes the SGRI complete, update the BMF with the information contained on the SGRI. If the organization used the "List of Parent and Subsidiary Accounts" as their SGRI, corrections will be shown on the listing. Update the BMF with the changes indicated.

  2. When the BMF is updated, always annotate the SGRI or List of Parent and Subsidiary Accounts with the action taken.

Name Change
  1. When a name change is shown for a subordinate, proceed as follows:

    1. Determine if subordinate is for a church, credit union, or GEN 0002 - Moose International, GEN 3017 - Banner Health Systems, GEN 3297 - Nami Virginia, GEN 3641 - Cleveland Clinic Foundation, GEN 5269 - Court Appointed Special Advocates of New Jersey, GEN 9405 - Illinois PTA. If the subordinate is a church credit union, or GEN 0002/3017/3297/9405, input a TC 013 for each of the subordinates which indicate a name change. It isn't necessary to secure an amendment showing the name change on a subordinate. If the subordinate isn't a church, credit union or GEN 0002/3017/3297/9405, input a TC 016 for a sort name line update for each of the subordinates which indicates a name change.

      Caution:

      IRM 3.13.12.12.5 before changing subordinate' names.

    2. Some GEN’s are not included in the above list. Refer to the pilot voucher for instructions.

    3. CC ENREQ/CC BNCHG with Doc. Code 63 can be used in lieu of CC EOREQ/CC EOCHG for this specific process.

  2. When a name change is shown for a parent, IRM 3.13.12.12.9.1.

Address Change
  1. When the mailing address change is shown either to a parent or a subordinate, proceed as follows:

    1. Use CC ENREQ/CC BNCHG with Doc. Code 63 and TC 014 if the street, city, state and ZIP is being changed.

      Caution:

      Don’t retain the former street address as the location address when the officer is changed and the mailing address is changed to a P.O. Box.

Care of Name Change
  1. When a "care of name" or the chapter name or number is the only change shown for a parent or subordinate, proceed as follows:

    1. Use CC ENREQ/CC BNCHG with Doc. Code 63 and TC 016 for the subordinate that has the change.

Subordinate No Longer Member of Group Ruling
  1. When a subordinate is no longer included in the group exemption, proceed as follows:

    1. If the subsection is IRC 501(c)(3), (9) (17) or (29), update the subordinate to status 40.

    2. If the subsection is other than IRC 501(c)(3), (9), (17) or (29), update the subordinate to status 36 with 990 filing requirements.

      Note:

      If necessary, input a TC 022 to remove the subsection prior to updating the status to 36 or 40. Manager or Lead approval not required.

    3. If a subordinate is in Status 97, IRM 3.13.12.11.4 paragraph (6) box 19.

  2. If the parent indicates the subordinate is" out of business" "terminated," "dissolved" or similar wording place the subordinate in status 28.

  3. A church subordinate with IRC 501(c)(3) exemption and one of the following in its name isn't required to file for exempt status.

    • Assembly or Assembly of God

    • Chapel

    • Church

    • Fellowship

    • Jehovah's Witness

    • Monastery

    • Seventh Day Adventist

    • Synagogue

    • Mosque

    • Temple

    • Worship Center

    • Iglesia

    • Kirche

    Input a TC 022 to delete the subsection and GEN information. This action will prevent unnecessary correspondence. Don’t place the account in status 40 as instructed in IRM 3.13.12.12.12.4.4 paragraph (1).

  4. When there are no subordinates left in the group ruling, proceed as follows:

    1. Call or correspond with the parent using Letter 3064C to determine if subordinates will be added in the future. Some groups may indicate they don't have any subordinates at the current time but may have subordinates in the future. Since the organization had to have subordinates to obtain a group exemption, the parent can maintain the group exemption according to the Cincinnati DPO.

    2. If the parent responds with the addition of subordinate(s), IRM 3.13.12.12.12.4.5 for instructions on adding subordinates.

    3. If the parent responds with no subordinate(s) to add, update the parent to their individual ruling per instructions in IRM 3.13.12.6.18.16 paragraph (2). Individual ruling information can be found on EDS/TEDS.

Adding a Subordinate
  1. When a new member of the group is added, which has not had a previous ruling or exemption proceed as follows:

    If Then
    The EIN is already on the BMF,
    1. Ensure EIN belongs to the subordinate organization. See note below.

    2. Remove incompatible filing requirements.

    3. Use CC EOREQ/CC EOCHG, Doc. Code 80, TC 016, Definer Codes ABC and the exemption data from the pilot voucher. Take the following fields from the pilot voucher: subsection, foundation code (if applicable), classification code, affiliation code, type of organization, status code and date, ruling date, deductibility code and year, new GEN, pension plan, employment code, FYM, NTEE, NAICS code, and filing requirements.

    Note:

    If the organization is an IRC 501(c)(3) and the deductibility code is 1, using the ruling date for the YYYY.

    Exception:

    If a potential subordinate is on the BMF but the EO Status Code is 22 or 97, don't add the organization to the group. Notify the subordinate they can’t be added and they can contact Cincinnati for further information.

    Note:

    If the entity is a university, college, credit union, school district or bank etc. don't add to the GEN. Alert the parent, the subordinate is using an incorrect EIN.

    If the EIN has incompatible filing requirements
    1. Ensure the EIN belongs to the subordinate.

    2. If so, remove incompatible filing requirements prior to adding subsection.

    The EIN isn't on the BMF, Use CC ENREQ/CC BNCHG with Doc. Code 63, TC 000. Add the exemption data from the pilot voucher using CC EOREQ/EOCHG Doc. Code 80.
    The subordinates in the group don't have EINs, Perform research to determine if an EIN has already been established.
    The EIN is located, Proceed as above.
    Research fails to locate the EIN: Correspond requesting Forms SS-4 for the subordinates being added.
    The EIN is on the BMF with a sole proprietor's SSN cross reference, Input TC 016 on BNCHG to remove it. Failure to remove SSN will cause addition of the subsection to unpost. Remove the SSN by inputting TC 016 SOLE-PRP-SSN - 000-00-0001.
  2. When a new member is added to a group which had previously been covered by an individual ruling, proceed as follows:

    1. Research using CC ENMOD, CC BMFOL or CC INOLE.

    2. Look up the pilot voucher on the Form 2363A or the use the SGRI.

    3. Use CC EOCHG with Doc. Code 80 and TC 016 to update the BMF with the exempt data that is changed.

    4. Be sure to change the affiliation code and add the GEN.

  3. When the SS-4 is included for a new subordinate of the group, follow the procedures for assigning an EIN and see IRM 3.13.12.6.18.3 for inputting Status 01.

Merger of Two Subordinates
  1. When a subordinate is merged with another subordinate within the same group, proceed as follows:

    1. Use CC EOREQ/CC EOCHG with Doc. Code 80, TC 016, and Definer Code B with Status Code 26. The date should be the date of the merger if known or if not known the current year and month. Always input the x-reference EIN.

Inactive Subordinate
  1. When the SGRI is received and the parent organization indicates a subordinate is inactive, update the Form 990 filing requirement to 02 with a TC 016 Doc. Code 80 Definer Code A, subsection, type of foundation if applicable, classification code, From GEN, FYM and remarks.

  2. When inactive subordinate was incorrectly put in Status 20/28, proceed as follows:

    1. Look up the pilot voucher on the Form 2363A.

    2. Use CC EOREQ/CC EOCHG with Doc. Code 80, TC 016, Definer Codes ABC to correct the BMF. Use the pilot voucher for the subsection code, foundation code (if present), classification code, affiliation code and status code using the ruling date as the year. The FRC should be updated as indicated by the parent. However, if not indicated, always use an 02. Always enter the FYM from the BMF, unless that is also indicated as changed by the parent.

  3. When an inactive account becomes active, use CCs EOREQ/EOCHG, with Doc. Code 80, TC 016, Definer Codes ABC to correct the BMF. Use the pilot voucher for the subsection code, foundation code (if present), classification code, affiliation code and status code using the ruling date as the year. The FRC should be updated as indicated by the parent. However, if not indicated, always use an 02. Always enter the FYM from the BMF, unless that is also indicated as changed by the parent.

Filing Requirement Change
  1. When the parent subsidiary list is used and the filing requirement is changed, proceed as follows:

    1. If the Form 990 filing requirement of 01 is changed to 990-02 because gross receipts are $50,000 or less, use CC EOREQ/CC EOCHG, Doc. Code 80, TC 016, Definer Code A with the subsection, type of foundation (if applicable), and classification code from the pilot voucher to correct the BMF to Form 990-02. Always enter the FYM from the BMF, unless that is also indicated as changed by the parent.

    2. Input an 02 in Field 990.

    3. If the Form 990 filing requirement of 02 is changed to 990-01, use CC EOREQ/CC EOCHG, Doc. code 80, TC 016, Definer Code A with the subsection and classification code from the pilot voucher to correct the BMF.

    4. Input a 01 in Field 990.

Subordinate Incorrectly Included in Group Ruling
  1. When the parent subsidiary list is used and the parent has indicated the subsidiary organization was incorrectly included in the group ruling, research for another EIN without a group ruling or research to determine if it belongs to another group ruling.

  2. If research locates another EIN and it has a ruling with a Status Code of 01, a subsection code and an Affiliation Code of 1-5:

    1. Use CC EOREQ/CC EOCHG with Doc. Code 80, TC 016 and Definer Code C for the account on the subsidiary list and delete the GEN.

    2. Input the GEN found on Master File in the FRM-GRP-EXEMP-NUM field and "9999" in the NEW-GRP-EXEMP-NUM field.

    3. After the account is updated, the two EINs can be consolidated. Use CC ENREQ/CC BNCHG, Doc. Code 63, TC 011, the EIN from the parent subsidiary list is the "from number" and the EIN located is the "to number."

  3. If a new EIN is located but isn't in Status 01, or doesn't have a subsection code or affiliation code:

    1. Use CC ENREQ/CC BNCHG, Doc. Code 63, and TC 022 for the account on the parent subsidiary list.

      Note:

      Before inputting TC 022, IRM 3.13.12.6.2.6 for information on freeze codes.

    2. After the BMF is corrected, the two EINs can be consolidated. Use CC ENREQ/CC BNCHG, Doc. Code 63, and TC 011 with the EIN from the parent subsidiary list as the "from number" and the EIN located as the "to number."

  4. If research doesn't locate another EIN, use CC ENREQ/CC BNCHG, Doc. Code 63, and TC 022 with the EIN of the account on the parent subsidiary list.

  5. If research determines the account belongs to another group ruling, use CC EOREQ/CC EOCHG, Doc. Code 80, TC 016, and Definer Code C to correct the GEN.

Merger of Two Groups
  1. Correspondence received for a merger of two group rulings or two groups merging and forming a new group, should be forwarded to Cincinnati. Once Cincinnati has approved the merger, they will notify EO Entity at the Ogden Submission Processing Center to input the appropriate actions.

  2. Research EDS to determine if there is an open case. If there is an open case:

    1. Forward the correspondence to the agent assigned to the case.

    2. Notify the organization of the transfer of the correspondence with a 86C Letter.

  3. If there is no open case:

    1. Send the correspondence to the Cincinnati campus with a Form 3499 attached indicating to "Establish T (Termination) or A (Amendment) case" .

    2. Notify the organization of the transfer of the correspondence with 86C Letter. Also, if necessary, notify the organization amended organization documents are required to merge group rulings.

Parent of a Church
  1. If a listing similar to an SGRI is received from a parent of a church, Affiliation Code 8, make the necessary updates.

    1. Make changes to the parents' entity as indicated by the SGRI.

    2. If a name change to a subordinate is indicated, research to determine if the subordinate is established on the BMF. Use CCs ENMOD, INOLE or BMFOL. If the subordinate is on the BMF, make the necessary changes.

      Caution:

      IRM 3.13.12.12.5 and IRM 3.13.12.12.12.4.1 before changing subordinate's name.

    3. If the parent wishes to add a subordinate and has supplied sufficient information (EIN, church name and address), use the pilot voucher to establish the new subordinate on Master File.

    4. After all changes are made, notify the parent organization with a 1169C Letter our records were changed. Annotate on listing "don't generate the 1169C Letter." Maintain in the SGRI suspense file.

Change to All Subordinates of a Group
  1. If a change is made which affects all the subordinates under a group ruling, revise the pilot voucher and give the pilot voucher to the Lead for imaging the first of each quarter.

  2. If the change indicates all the subordinates are no longer members of the group but doesn't indicate the group is dissolved, contact the parent to determine the status of the group exemption.

    1. If the parent replies the group is dissolved, update all subordinates to status 40 if subsection is IRC 501(c)(3), (9), (17), (29) or status 36 if subsection is other than IRC 501(c)(3), (9), (17) or (29). Update the parent account to their prior individual ruling using instructions in IRM 3.13.12.6.3.5 and 3.13.12.12.7. Individual ruling information can be found on EDS/TEDS. Give a copy of the pilot voucher to the Lead indicating the group is dissolved and should be removed from the Form 2363 A pilot voucher site.

    2. If the parent replies the group is still operating and other subordinates will be added, take no action.

Completion of SGRI Processing
  1. After completing all required campus activity, an appropriate letter will be sent by the tax examiner/unit clerk to notify the parent organization our records were changed to reflect any additions, deletions, etc. The second copy of the letter will be retained in the specific GEN file.

  2. Don’t send the SGRI data submitted by the parent organization to the Area Office. Maintain the SGRI data for one year; e.g., to resolve any unpostable conditions. Destroy the SGRI per local campus disposition procedures.

State-Chartered Credit Unions

  1. There are three categories involved with state-chartered credit unions:

    • States which have received a group ruling

    • States which have not received a group ruling, but file a group return

    • States which are not authorized to charter a credit union

States with Group Rulings
  1. A state may apply for a group ruling just to file a group return for all its credit union members. The state banking rules allow the state to file the group return. The parent of this type of a group ruling is usually a figurehead (dummy entity) for the state to use only for filing the group return.

  2. The parent for states with a group ruling should have a filing requirement of a Form 990–03. A separate entity for the group return should not be established.

  3. When a new group ruling for a state is received, the processing will be the same as IRM 3.13.12.12.4 , Processing New Groups- -Parents, except the filing requirement for the parent will be a Form 990 of 03 and the words "Group Return" will be added to the parent's name. However, don't add group return to the organization name on the pilot voucher.

  4. If a group return is received for a state-chartered credit union which has already received a group ruling, the parent on the BMF should be corrected by the following:

    1. Add the words "Group Return" to the organization name;

    2. Update the Form 990 FRC to 03; and

    3. Update any other data from the pilot voucher, as applicable.

  5. If research locates another EIN for the group return:

    1. Contact the state to determine what each EIN is used for.

    2. Some of the EINs for the parents of state-chartered credit unions are really a legal separate entity of the state and should never be used as the parent of the group ruling. When this occurs, use the procedure for Definer Code F.

    3. If the parent's EIN isn't a legal separate entity of the state, input TC 022 to delete the EO section from the group return entity. After the TC 022 has posted the group return entity should be consolidated with the parent account. Use CC ENREQ/CC BRCHG, Doc. Code 63, TC 011 and the EIN from the group return entity as the "from number" and the EIN for the parent as the "to number. Notify Cincinnati of the EIN change if necessary."

      Note:

      Be very careful when consolidating the two EINs. Be sure the parent has a complete EO section.

  6. Some state-chartered credit unions file their SGRI with the group return. When this happens, Returns Analysis will copy page 1 of the return and forward it and the SGRI information to Entity Control for processing. IRM 3.13.12.12

  7. For name changes to state-chartered credit unions with a group ruling follow instructions given IRM 3.13.12.12.9.1 for parents of a group and IRM 3.13.12.12.12.4.1 for subordinates of a group.

States Without a Group Ruling
  1. The states which have not received a group ruling are still allowed to file a group return under Revenue Ruling 60–364 for all the credit unions in the state.

  2. A Form 990 group return for a state without a group ruling will not be coded as a group return by Return Analysis.

  3. Entity Control will receive these returns to be processed as an original filed return.

  4. Each credit union within the state will have applied and should have received an individual ruling and should be on the BMF from EDS.

  5. The subordinates listed on the group return will not require any action.

  6. If the entity is on the BMF:

    1. Use CC EOREQ/CC EOCHG with Doc. Code 80 or CC ENREQ/CC BNCHG with Doc. 63, and TC 013 to add the words "Group Return" to the organization name.

    2. Use CC EOREQ/CC EOCHG, Doc. Code 80, TC 016, Definer Code A and B, Subsection Code 14, Classification Code 1, Form 990 FRC of 01, Status Code of 01 and current year and month, FYM from the tax period on the return, and remarks for an audit trail.

  7. If the entity isn't on the BMF:

    1. Use CC EOREQ/CC EOCHG, Doc. Code 80, TC 000, "Group Return" in the Name of the Organization, Mailing Address, Subsection Code 14, Classification Code 1, 01 Status Code and current year and month, FYM from the tax period on the return, Form 990 FRC of 01, and remarks for an audit trail.

  8. For name changes to state-chartered credit unions without a group ruling, follow normal name change procedures for these type of credit unions.

States Not Authorized to Charter State Credit Unions
  1. If a Form 990 is received from a state which isn't authorized to charter state credit unions, whether it is a group return or an individual credit union, process as follows:

    If Then
    The entity is on the BMF, Use CC EOREQ/CC EOCHG with Doc. Code 80, TC 016 and Definer Code B with a Status Code 40.
    The entity isn't on the BMF, Use CC EOREQ/CC EOCHG with Doc. Code 80, TC 000 and add the account with a Status Code 40.

Form 8870

  1. Form 8870, Information Return for Transfers Associated With Certain Personal Benefit Contracts. IRC 170(f)(10), requires a charitable organization described in IRC 170(c) or a charitable remainder trust described in IRC 664(D) to complete and file Form 8870 if it paid premiums after February 8, 1999, on certain life insurance, annuity, and endowment contracts (personal benefit contracts).

  2. If you receive a Form 8870 in Entity, forward the return to the EOCA, MS 1112 where a fact of filing (TC 971 CC 349 will be input.

Section 527 Political Organizations

  1. Definition of Political Organizations: Political organizations are organized and operated primarily to accept contributions and make expenditures for the purpose of influencing the selection, nomination, election, or appointment of any individual to Federal, State, or local public office or office in a political organization, or the election of Presidential electors. Political organizations include political parties, committees, associations, Federal, State and local candidate committees and other political organizations such as political action committees (PACs).

  2. Legislation enacted on November 2, 2002 created a new sub-category of political organization -- qualified state or local political organization (QSLPO). A state or local organization may be a QSLPO, if it meets the following criteria:

    • The organization limits its exempt function to the purpose of influencing or attempting to influence the selection, nomination, election, or appointment of any individual to any state or local public office or office in a state or local political organization.

    • The organization is required under a state law to report to a state agency (and the organization does so) the information which otherwise would be required to be reported on Form 8872. The organization will meet this requirement even if the state law doesn't require reporting of the identical information required on the Form 8872, so long as at least the following information is required to be reported under the state law and is reported by the organization: (a) the name and address of every person who contributes $500 or more in the aggregate to the organization during the calendar year and the amount of each contribution, and (b) the name and address of every person to whom the organization makes expenditures aggregating $800 or more during the calendar year, and the amount of each expenditure. However, if the state law requires the reporting of (if an individual) the occupation or employer of any person to whom such expenditure are made, or the date or purpose of each such expenditure; or, if the state law requires the reporting of (if an individual) the occupation or employer of any such contributor or the date of each such contribution, the organization will meet this requirement only if it reports additional information to the state agency.

    • The state agency makes the reports filed by the organization publicly available.

    • The organization makes the reports filed with the state agency publicly available for public inspection during regular business hours at the organization's principal office (and at each of its regional or district offices having at least three paid employees). Contributor information must be disclosed to the public.

    • No federal candidate or office holder controls or materially participates in the direction of the organization, solicits contributions to the organization, or directs any of the organization's disbursement.

  3. Revised Tax Filing Requirements: The legislation adopted in 2002 altered filing requirements for certain political organizations which seek tax exempt status under IRC 527. The new law generally reduces filing requirements for certain state/local political organizations which already disclose certain information to state agencies. In addition, the law relieves some political organizations from filing an annual income tax return or an annual information return. Except where noted, the revised filing requirements are retroactive to July 1, 2000. This following discusses the current filing requirements as revised by the new legislation. FS 2002 11, published May 2002, is superseded. The new law:

    • Exempts state and local candidate and party committees from filing Form 8871 and Form 990 (or 990-EZ);

    • Exempts qualified state and local political organizations (QSLPOs) (as defined above) from filing Form 8872;

    • Exempts political committees filing with the FEC as a political committee from filing Form 990 (or 990-EZ);

    • Exempts political organizations which are a caucus or association of state or local officials from filing Form 990 (or 990-EZ);

    • Requires additional information on Form 8871 and Form 8872;

    • Requires the filing of an amended Form 8871 after material changes to maintain tax exempt status;

    • Increases reporting thresholds for certain Form 990 filers;

    • Eliminates the requirement to file Form 1120POL except where an organization has taxable income after taking the $100 specific deduction (returning to pre-July 2000 requirements);

    • Reinstates the pre-July 2000 confidentiality requirement for any Form 1120POL filed after November 2, 2002; and

    • Changes the electronic filing requirements by (a) Requiring Form 8871 be filed electronically (as opposed to both in writing and electronically); and (b) Requiring any Form 8872 due after June 30, 2003, be filed electronically if the filing organization has or expects to have contributions or expenditures of more than $50,000 during the calendar year.

  4. Tax-Exempt or Non Tax-Exempt: 527 political organizations may be either tax-exempt or non tax-exempt.

    Type Description
    Tax-Exempt Political Organizations A political organization is tax-exempt if it gives notice under IRC 527(i) (filing Form 8871) or isn't required to give notice because it meets one of the exceptions under IRC 527(i)(5) and (6). Political organizations which are not required to give notice under IRC 527(i)(5) and (6) to be tax-exempt are the following:
    1. Any person required to report under FECA as a political committee (see 2 U.S.C. section 43/et seq.);

    2. Any political committee of a state or local candidate;

    3. Any state or local committee of a political party;

    4. Any organization which reasonably anticipates its annual gross receipts will always be less than $25,000.

    Note:

    Any organization described in IRC 501(c) which is subject to IRC 527 (f)(1) because it has made an "exempt function" expenditure isn't required to give notice under 527(i).

    Non Tax-Exempt Political Organization A non tax-exempt political organization is a political organization which has not given timely notice under 527(i) (if it doesn't meet one of the exceptions in 527(i)(5) or (6)). Without timely notice it was established, the political organization is taxable for any period beginning with the establishment of the organization and ending on notice of the establishment of the organization. Without timely notice under 527(i) of a material change, the political organization is also taxable for the period beginning on the date on which the material change occurs and ending on the date on which notice is given.
  5. Taxable Income: The taxable income of a tax-exempt political organization and a non tax-exempt political organization are different.

    Type Description
    Taxable Income of a Tax-Exempt Political Organization A tax-exempt political organization isn't taxed on its exempt function income. It is, however, subject to tax on other types of income. Taxable income includes:
    • Gross income (excluding exempt function income

    • Minus deductions allowed which are directly connected to the production of the gross income (excluding exempt function income)

    • Modifications: special deduction of $100, no net operating loss, or no deduction of the special deduction for corporations

    Note:

    Exempt function income is income received as contributions; membership dues, fees, or assessments; income from a political fund-raising or entertainment event which isn't a regularly carried on trade or business; income from the sale of political campaign materials which isn't a regularly carried on trade or business; or bingo income, provided such income is segregated for use only for an exempt function under IRC 527(e)(2).

  6. Filing Categories: Federal tax law divides tax-exempt political organizations into several different categories, and provides different filing requirements for each category.

    Filing Categories
    Federal Organizations
    • FEC political committee: A political organization (including federal candidate committees, political party committees and PACs) is required to report as a political committee under the Federal Election Campaign Act.

    • Other federal political organization: A political organization attempting to influence federal elections isn't required to report as a political committee under the Federal Election Campaign Act.

    State and Local Organizations
    • Candidate committee: A campaign committee of a state or local candidate.

    • Party committee: A state or local committee of a political party.

    • Qualified state or local political organization (QSLPO): See above definition.

    • Caucus or association of state or local officials; a group of state or local officials attempting to influence elections.

    • Other political organizations: any other state or local political organization.

  7. Filing Requirements: The filing requirements in the chart below apply to those tax-exempt political organizations which receive or expect to receive $25,000 or more in gross receipts in any taxable year.

    If the Organization is a It May Be Required to File
    FEC political committee, state or local candidate committee or state or local committee of a political party, Form 1120POL.
    Qualified state or local political organization (QSLPO)*, Form 8871;
    Form 1120POL; and
    Form 990.
    Caucus or association of state or local officials*, Form 8871;
    Form 8872; and
    Form 1120POL.
    Any other political organization, including other federal political organizations and other state or local political organizations, Form 8871;
    Form 8872;
    Form 1120POL; and
    Form 990 or Form 990-EZ.

    *An organization may be both a QSLPO and a caucus or association of state or local officials. If so, it isn't required to file Form 8872 and Form 990.

    Note:

    Political organizations, whether tax-exempt or not, must file Form 1120POL for the taxable year if they have taxable income in excess of the $100 specific deduction.

  8. Description of Form Filing Requirements

    1. Form 8871 – Notice of 527 Status: Unless excepted (see chart below), a political organization must file Form 8871, Political Organization Notice of 527 Status, with the IRS to be tax-exempt. Until it files the form, its income (including contributions) is subject to taxation. Form 8871 must be filed electronically within 24 hours of the political organization’s establishment. An amended Form 8871 must be filed within 30 days of any material change (including termination), or any income (including contributions) it receives after the material change will be subject to taxation.

    2. Form 8872 - Report of Contributions and Expenditures: Tax exempt political organizations, other than QSLPOs, that file Form 8871 must file Form 8872, Political Organization Report of Contributions and Expenditures, to disclose information concerning expenditures that aggregate $500 or more per person, per calendar year; and contributions which aggregate $200 or more per person, per calendar year. A tax-exempt political organization which doesn't disclose this information must pay an amount equal to the highest corporate tax rate (35 percent) multiplied by the amount of contributions and expenditures not disclosed. The filing due dates are available on the IRS web site at www.irs.gov/polorgs. A political organization isn't required to file Form 8872 for any period of time it is subject to tax on its income because it did not file or amend a Form 8871.

    3. Form 1120POL – U.S. Income Tax Return for Certain Political Organizations: Political organizations, whether or not tax exempt, which have taxable income in excess of the $100 specific deduction in a taxable year must file Form 1120POL, U.S. Income Tax Return for Certain Political Organizations. Form 1120POL is due by the 15th day of the 3rd month after the end of the organization’s taxable year. Political organizations may request a six-month extension of the filing deadline by filing Form 7004, Application for Automatic Extension of Time to File Corporate Income Tax Return. This extension must be filed by the due date of Form 1120 POL. There is a penalty for failure to file Form 1120POL.

    4. Form 990 or 990-EZ – Return of Organization Exempt from Income Tax: Unless excepted (see chart below), a tax-exempt political organization must file an exempt organization annual information return if it has gross receipts of $25,000 or more for the taxable year ($100,000 for QSLPOs). A tax exempt political organization with gross receipts of less than $100,000 and assets of less than $250,000 at the end of the year may file a Form 990-EZ, Short Form Return of Organization Exempt from Income Tax. Otherwise, it files a Form 990, Return of Organization Exempt from Income Tax. Form 990 or Form 990-EZ is due on the 15th day of the 5th month after the end of the organization’s taxable year. There is a penalty for failure to file this return. Organizations may request a three-month extension, without showing cause, by filing Form 8868, Application for Extension of Time to File an Exempt Organization Return, by the due date. A second three-month extension, with cause, may also be requested through Form 8868.

  9. Summary of Form Filing Requirements

    Form When Filed Exceptions to Filing Requirement
    8871 Within 24 hours of establishment or within 30 days of any material change, including termination
    • Organization which doesn't seek tax exempt status;

    • Political committee required to report to the FEC;

    • Campaign committee of state and local candidates;

    • State or local committee of political parties; and

    • Organization which reasonably expects annual gross receipts to always be less than $25,000.

    8872 At organizations option, quarterly/semiannually or monthly, on same basis for entire calendar year (see form instructions for detailed information)
    • Any organization excepted from Form 8871 filing requirement (see above); and

    • Qualified state or local political organization (QSLPO).

    1120POL Due the 15th day of the 3rd month after the close of the taxable year Political organization with no taxable income after taking the $100 specific deduction
    990 or 990-EZ Due the 15th day of the 5th month after the close of the taxable year
    • Any organization excepted from Form 8871 filing requirement (see above); and

    • Caucus or association of state or local officials.

  10. Disclosure Requirements: Tax exempt IRC 527 organizations must make their forms (other than Form 1120 POL) publicly available for inspection and copying at their principal place of business. The IRS also posts Form 8871 and Form 8872 on its web site at www.irs.gov/polorgs.

  11. The following web sites are used when completing Political Action Committee (PAC) processing:

    • IRC 527 Online Document Images - http://ws00012.wdc.is.irs.gov/cgi-bin/section 527.html.pl

    • Political Action Committee (PAC) Reporting System (ORACLE) - http://10.219.66.122/forms/frmservlet?config=pac

    • Political Organization Filing and Disclosure - http://www.irs.gov/charities/political/article/0.id=109644.00.html

Form 8871/8453-X

  1. Political organizations must file Form 8871, Political Organization Notice of Section 527 Status, in order to be an tax exempt organization under the rules of IRC 527. The IRS is required to make publicly available on the internet and at its offices, a list of the organizations which file Form 8871. Every political organization which is to be a tax exempt political organization under the rules of IRC 527 must file Form 8871, except for:

    • An organization which reasonably expects its annual gross receipts to always be less than $25,000

    • A political committee required to report to the FEC

    • A campaign committee of state and local candidates

    • A state or local committee of political parties

    • A tax exempt organization described in IRC 501(c) is treated as having political organization taxable income under IRC 527(f)(1)

Electronic Form 8871
  1. For a 527 political organization formed between June 30, 2000 and December 1, 2002, Form 8871 must be filed both electronically and by paper within 24 hours of the date on which the organization was established.

  2. Beginning December 2, 2002, Form 8871 must be filed within 24 hours of formation in electronic format only; the paper Form 8871 jurat must be sent to Ogden for processing. Beginning June 30, 2003, new political organizations are required to submit to the Ogden campus a Form 8453-X, Political Organization Declaration for Electronic Filing of Notice of Section 527 Status, containing the signature for the electronic Form 8871; this form replaces the Form 8871 jurat.

  3. Beginning January 2006, the electronic Form 8871 will be posted to Master File with a TC 150 for MFT 47 instead of a TC 971 ac 350 and the Form 8453-X will still be posted to Master File with a TC 971 ac 351 on CC ENMOD and CC BMFOLE.

  4. The electronic Form 8871 is filed by the organization on the IRS Internet site located at www.irs.gov/polorgs. The electronic Form 8871 information input by the organization is stored by IRS in an ORACLE database maintained by national office programmers.

  5. The TC 150 for MFT 47 the electronic Form 8871 will be automatically posted to Master File. If, during posting, the program determines there is no EIN present on Master File, the transaction will be re-sequenced for 4 cycles to allow the Form SS-4 to be processed. If, after 4 cycles, the transaction still can’t post, it will go unpostable as an UPC 301 RC 1.

  6. An amended electronic Form 8871 may be submitted by the organization for any material change made by the organization (including termination) within 30 days of the change. The amended Form 8871 will be posted to Master File with a TC 976. The organization isn't required to file a Form 8453-X with the associated amended Form 8871. Therefore, it will be not be necessary to input a TC 971 ac 351 for an amended Form 8871.

Form 8453-X
  1. A Form 8453-X is filed by a Political Action Committee (PAC) following their electronic submission of Form 8871. Entity will receive the Form 8453-X from Batching. Entity will perform research and correspondence procedures. When Entity has completed these procedures and input the fact of filing with a TC 971 ac 351 on original Forms 8453-X only, they will send the Form 8453-X to files.

  2. If correspondence with the organization is required, correspond once and suspend for 45 days.

  3. Research to determine if the:

    • Signature is present.

    • Organization has a valid political organization name control on Master File.

    • Organization has a valid EIN.

    • Organization has an account established on Master File as a 527 political organization.

    • TC 150 for MFT 47 or TC 971 Action Code 350 has posted to the same EIN.

  4. If the Form 8871 isn't filed, don't send the F8453-X back to the filer. Send a letter requesting the filer submit the Form 8871.

  5. If the signature isn't present on the form 8453-X, return the signature page to the organization with a 3710C Letter requesting a signature.

    Note:

    When tax returns are received via fax as part of return perfection and contact with the taxpayer is made and documented, faxed signatures are legally sufficient. Return preparer's may sign original returns, amended returns, or requests for filing extensions using a signature stamp. Taxpayers, however, must continue to sign their returns with an original signature.

  6. IRM 3.13.12.6.5 paragraph (6) for instructions on how to setup a political organization name and name control on Master File. Research CC INOLE to determine if the name control is valid. If the name control isn't valid, correct the Master File with a TC 013 using either CCs ENREQ/BNCHG. If the name control is valid, continue processing.

  7. A valid EIN is defined as the same EIN on Master File with an organization name which (approximately) matches the name on the Form 8453-X. Research CC INOLE to determine if the EIN is valid. If the EIN is valid, continue processing. If the EIN isn't valid, research IDRS via CC NAMEE/NAMEB to find a valid EIN.

    If Then
    An EIN is found:
    1. Perfect the Form 8453-X with the correct EIN using a black pen.

    2. Copy the first page of the Form 8453-X, mark the correct EIN on the copy, and update Oracle.

    3. Send a 3910C Letter to the organization informing them of their correct EIN.

    4. Input a TC 971 ac 351 on the correct EIN.

    The EIN has fallen off Master File, Re-establish the account on Master File with a TC000.
    An EIN cannot be found:
    1. Assign an EIN via CC ESIGN using MFI O, Notice Indicator Code A, Return ID Code PL, and tax period YYYY12. See IRM 21.7.13 for complete instructions on assigning an EIN.

    2. Annotate the new EIN on the Form 8453-X with black ink.

    3. Update Oracle.

  8. When all research is complete, do the following:

    • Input a TC 971 AC 351 on the account.

    • Edit the name control, tax period, source document number, actions taken, your TE number and the date on the Form 8453-X.

    • Prepare a source document gusset with label for the Forms 8453-X processed that day.

    • Attach a green router and route the gusset to files.

      Note:

      Only the Form 8453-X and the envelope should be sent to files. Detach any correspondence or copies of Form 8871.

      Note:

      If a Form 8453-X is received before the account is fully established on Master File and/or the Form 8871 is posted, suspense the form until you are able to process it.

  9. Research CC INOLE to determine if an EO section is present and if the organization has a valid 501(c) exemption. If the organization has an established EO section with a valid exemption, correspond with the organization using a 3710C Letter to determine why they filed a Form 8871. Explain normally a 501(c) organization can’t be a 527 organization also. Request they file a Form SS-4 if they are a political organization operating under the rules of IRC 527. Include a Form SS-4 with the 3710C Letter.

    Note:

    A 527 organization doesn't have to apply for exemption, but they are treated as if they are exempt. Normally, a 501(c) organization which has a valid exemption can't be a 527 organization as well. However, a 501(c) organization may file a Form 1120POL for tax due under IRC 527(f).

    If Then
    The organization responds with a Form SS-4:
    1. Assign an EIN in the usual manner. See IRM 21.7.13 for EIN procedural instructions. Use Return ID Code PL for the CP 576.

    2. Annotate the EIN on the Form 8871 jurat.

    3. Reverse any TC 971 on the exempt organization account with CCs REQ77/FRM77 and input a TC 972, transaction date of MMDDYYYY, and an Action of 350 (or 351, if appropriate).

    4. Input a TC 971 ac 351 for the Form 8453-X on the new EIN.

    5. Copy the Form 8871 from the IRS web site (irs.gov/polorgs). Annotate the new EIN on the Form 8871. Send the Form 8871 to Imaging to be imaged and destroyed.

    The organization doesn't respond, Assign an EIN in the usual manner and follow the instructions above.
  10. Research CC ENMOD to determine if the TC 150 for MFT 47 or TC 971 Action Code 350 (electronic Form 8871) has posted. If there is no TC 150 or TC 971 Action Code 350, research CCs NAMEE/NAMEB or Internet (irs.gov/polorgs) to find the missing electronic Form 8871. If the electronic Form 8871 isn't found, correspond with the organization using a 3710C Letter indicating the Form 8871 must be filed electronically. If the TC 150 or TC 971 ac 350 is present, continue processing.

  11. If the organization isn't a IRC 527 organization and was established in error, take the following actions:

    1. Remove the EO section with a TC 022 if the organization doesn't have an exemption. Add the appropriate filing requirements, if known.

    2. Write REMOVE on the top of the Form 8453-X. Update the Oracle website.

    3. Reverse any TC 971 Action Code 35X with a TC 972 using CCs ENMOD/REQ77.

  12. If the organization indicates their gross receipts are under $25,000, update the Form 990 filing requirement to 02 with a TC 016 Doc. Code 80 Definer Code A.

  13. Input the fact of filing. To input a TC 971 Action Code 351, use the following procedures:

    • Access CC ENMOD.

    • Access CC REQ77 with the EIN on the first line, MFT 00 and tax period 000000on the second line, and Name Control on the third line.

    • Input TC>971 (on the FRM77 screen).

    • Input TRANS-DT>MMDDYYYY

      Note:

      TRANS-DT is the return received date or the return processable date, whichever is later.

    • Input SECONDARY-DT>MMDDYYYY (current date).

      Note:

      Beginning January 2006, the secondary date will be allowed.

    • Input TC971/151-CD>351.

    • Input Remarks>SD#### Form 8453-X.

  14. To reverse a TC 971 Action Code 351 with a TC 972, use the following procedures:

    • Access ENMOD.

    • Access CC REQ77 with the EIN on the first line, MFT 00 and tax period 000000 on the second line, and Name Control on the third line.

    • Input TC>972 (on the FRM77 screen).

    • Input TRANS-DT>MMDDYYYY

      Note:

      TRANS-DT is the return received date or the return processable date, whichever is later.

    • Input TC971/151-CD>35X.

    • Input Remarks>NSD reverse TC 971 ac 351.

  15. After the TC 971 is input, prepare a Source Doc. Folder. Label the folder with your IDRS number, date, and program code. Put the Forms 8453-X in the Source Doc. Folder and send to files.

Processed Forms 8453-X Received Back From Files

  1. Processed Forms 8453-X are periodically received from files with a pink sheet attached which states "Adjustment Action did not take." Print TXMOD or BMFOLT showing the TC971 AC 351, highlight the DLC for the transaction and return to Files at the mail stop listed on the pink sheet.

Form 8872

  1. Every IRC 527 tax-exempt political organization which accepts a contribution or makes an expenditure for a tax-exempt function during the calendar year is subject to penalty under IRC 527(j) if it doesn't file Form 8872 electronically or by paper except:

    • a political organization which isn't required to file Form 8871,

    • a political organization which is subject to tax on its income because it did not file or amend a Form 8871, or

    • a qualified state or local political organization.

  2. Effective June 30, 2003, Form 8872 must be filed electronically if the organization has reason to expect contributions or expenditures will exceed $50,000 in the calendar year.

  3. For a summary of the filing requirements for political organization, IRM 3.13.12.14 paragraph (9).

  4. Due dates for Form 8872 vary depending on whether the form is due for a reporting period which occurs during a calendar year in which a regularly scheduled election is held or any other calendar year. During an election year, the organization may opt to file its reports on either a quarterly or a monthly basis, but it must file on the same basis for the entire calendar year. During a non-election year, the organization may opt to file its reports on either a semiannual or a monthly basis, but it must file on the same basis for the entire calendar year.

  5. IRS will make Form 8872, including Schedules A and B, open to public inspection.

  6. All paper Forms 8872 will be batched, sent through normal processing, and posted with a TC 150 for MFT 49. Paper Forms 8872 will no longer be posted with a TC 971.

  7. If it is necessary to correspond with the organization, correspond once. Suspend for 45 days. Correspondence should be sent to the name and address listed as the "Name of Contact" person. If this entry isn't present or incomplete, correspond with the "Name of Organization" .

    Caution:

    If corresponding, all issues must be included in the initial correspondence.

  8. To input a TC 971 ac 001 to indicate a TC 150 for a Form 8872 is being received from a different EIN, use the following procedures:

    • Access CC REQ77 with the EIN on the first line, MFT 49 and tax period YYYYMM on the second line, and Name Control NAMEon the third line.

    • Input TC>971 (on the FRM77 screen).

    • Input TRANS-DT>MMDDYYYY

    • Input TC971/151-CD>001

    • Input XREF-TIN>NN-NNNNNNN

      Note:

      This is the cross reference EIN the Form 8871 is being moved to.

    • Input Remarks>Moved TC 150 for MFT 49

  9. To input a TC 971 ac 017 to indicate a TC 150 for a Form 8872 is being received from a different EIN, use the following procedures:

    • Access CC REQ77 with the EIN on the first line, MFT 49 and tax period YYYYMM on the second line, and Name Control NAMEon the third line.

    • Input TC>971 (on the FRM77 screen).

    • Input TRANS-DT>MMDDYYYY

    • Input TC971/151-CD>017

    • Input XREF-TIN>NN-NNNNNNN

      Note:

      This is the cross reference EIN the Form 8871 is being received from.

    • Input Remarks>Received TC 150 for MFT 49

  10. If the Form 8872 has not been stamped by the Imaging Unit, route the form to imaging after completing entity actions.

TCC TIER II Reports

  1. Entity will receive daily TCC Tier II Reports via email. The following reports will be printed and batched by the clerical staff:

    • New Electronic 8871 Submissions

    • New Electronic 8871 Submissions with Address changes

    • Rejected Accounts: PACs with no Elec. Form 8871

    • IMPORT-EXPORT Email Notification

    • New Electronic 8872 Submissions

    • Electronic 8872 Change of Address Submissions

    • Final Electronic 8872 Submissions

    • Initial Electronic 8871 filings which are missing 8453-X

  2. Other reports which may be present but are only worked if instructions for Entity are present:

    • Dump.sh Results

    • Failure on push_image_fls.sh

    • Failure on run_section_527.sh

    • List of transmitted Section 527 PDF files

    • Status of ftp of Electronic GMF data

    • Success on push_image_fls.sh

    • Success on run_section_527.sh

    • Warning on push_image-fls.sh

TCC Tier II New Electronic 8871 Submissions
  1. To complete the TCC Tier II New Electronic 8871 Submissions report do the following:

    1. Access the Political Organization Filing and Disclosure (POFD) web site and locate the organization's information.

    2. Check the EIN. If the EIN isn't valid:

      If Then
      an EIN is found, edit the correct EIN on the email, send a 3910 C letter informing the organization of their EIN. Update Oracle by doing the following:
      1. Click on resend to BMF Master File.

      2. If the form can be resent, a box will appear asking "Are you sure you want to send this filing back to BMF Master File as a TC - 150 with a new DLN?" Click "yes" .

      3. If it is too soon to resend the form, a box will appear stating "Filing cannot be resent to BMF Master File for four weeks since last transmission." Notate the date the form can be resent and hold until that date.

      If an EIN is no longer present on the BMF Master File, re-establish the account on Master File with a TC000.
      If an EIN cannot be found, assign an EIN via CC ESIGN using MFI O, notice indicator code A, Return ID Code PL and tax period YYYY12. (Current year). Edit the EIN in black ink and update Oracle using the resend the TC 150 to BMF Master File located above.
    3. Use the individual listed as a contact for the in care of name. Update if necessary.

    4. Update or establish the EO subsection based on the organizations answers to the following:

      If Then
      the organization indicates they are exempt from filing Form 990, update the subsection using CC EOREQ/EOCHG Doc Code 80, Definer Codes AB, Subsection 82, Classification code 1, EO Status Code 34/date, 990-00 and 1120-09 filing requirements.
      the organization indicates they are not exempt from filing Form 990, update the subsection using CC EOREQ/EOCHG Doc Code 80, Definer Codes AB, Subsection 82, Classification code 1, EO Status Code 34/date, 990-01 and 1120-09 filing requirements.
      no 1120-09 (Form 1120-POL) filing requirements are on the account, add 1120-09 filing requirements.
    5. Update or establish the 527 Political Organization Indicator based on the organization answers on Form 8871 and the table below:

      If Then
      the organization indicated they are exempt from filing Form 8872 input a 527 indicator of "5" .
      the organization indicated they are required to file Form 8872 input a 527 indicator of "4" .
    6. If the organization marked final on the electronic Form 8871, ensure the appropriate final returns were filed. Then do the following:
      Remove the 527 Indicator with a "9" .
      Update the EO Status Code to 20.
      Zero out the Form 1120-09 filing requirement if present.

      Note:

      If all appropriate final returns were not filed, correspond with the organization using a 696C letter to request the missing final returns.

    7. If a date of material change is listed for an organization, the organization is filing an amended Form 8871. Research the IRS internet site (.irs.gov/polorgs) to determine why the amended return was filed.

    8. If the amended box is checked on the Form 8871, determine if the address on the amended Form 8871 is the same as the address on Master File. If the address is different, update the address on Master File with a TC 014 using CCs ENREQ/BNCHG or EOREQ/EOCHG.

  2. If correspondence with the organization is required, correspond once and suspend for 45 days. Correspondence should be sent to the name and address listed as the "Name of Contact" person on the electronic Form 8871. If entry isn't present or incomplete, correspond with the "Name of Organization" .

  3. To input a TC 971 ac 001 to indicate a TC 150 for a Form 8871 is being received from a different EIN, use the following procedures:

    • Access CC REQ77 with the EIN on the first line, MFT 47 and tax period YYYYMM on the second line, and Name Control NAMEon the third line.

    • Input TC>971 (on the FRM77 screen).

    • Input TRANS-DT>MMDDYYYY

    • Input TC971/151-CD>001

    • Input XREF-TIN>NN-NNNNNNN

      Note:

      This is the cross reference EIN the Form 8871 is being moved to.

    • Input Remarks>Moved TC 150 for MFT 47

  4. To input a TC 971 ac 017 to indicate a TC 150 for a Form 8871 is being received from a different EIN, use the following procedures:

    • Access CC REQ77 with the EIN on the first line, MFT 47 and tax period YYYYMM on the second line, and Name Control NAMEon the third line.

    • Input TC>971 (on the FRM77 screen).

    • Input TRANS-DT>MMDDYYYY

    • Input TC971/151-CD>017