3.21.3 Individual Income Tax Returns

Manual Transmittal

November 20, 2020

Note:DO NOT REMOVE AND INSERT PAGES OR DISPOSE OF OBSOLETE TRANSMITTALS PRIOR TO 01/01/2021.

Purpose

(1) This transmits revised Internal Revenue Manual (IRM) 3.21.3, International Returns and Documents Analysis - Individual Income Tax Returns.

Material Changes

(1) IRM 3.21.3.1 Removed duplicate information.

(2) IRM 3.21.3.1.1 Added list of processed forms. Added instruction to use IRM 3.11.3 in processing.

(3) IRM 3.21.3.3 Removed Form 8938 from bulleted list in (1). Added Form 8898 to bulleted list in (1).

(4) IRM 3.21.3.3.1(3) Converted table to If/And/Then table.

(5) IRM 3.21.3.3.2(7) Added note about determining TY19 physical presence dates. (IPU 20U0685 issued 06-10-2020)

(6) IRM 3.21.3.4(3) Added Form 1040-SR to Program 46112 and 46172.

(7) IRM 3.21.3.4.1(4) Removed Action Code 611.

(8) IRM 3.21.3.5 Added a table to specify instructions for identical return forms, and to specify return forms which are no longer valid and may require special processing.

(9) IRM 3.21.3.6.1 Converted information from paragraphs to tables.

(10) IRM 3.21.3.6.2(2) Added instructions to correspond for all issues when correspondence is required.

(11) IRM 3.21.3.6.2(3) Converted paragraph to lists.

(12) IRM 3.21.3.6.2(8) Deleted note and updated instructions for editing Action Code 215.

(13) IRM 3.21.3.6.3 Deleted General Response Procedures subsection.

(14) IRM 3.21.3.6.3(1) Added instructions from previous General Response Procedures section.

(15) IRM 3.21.3.6.4(1) Added instructions from previous General Response Procedures section.

(16) IRM 3.21.3.6.5(5) Deleted note, since IRC 931 is international criteria even without Form 4563.

(17) IRM 3.21.3.6.5(9) Deleted instruction to correspond for 2106.

(18) IRM 3.21.3.7 Updated title. Removed list of subsections.

(19) IRM 3.21.3.7.2(4) Converted table to 2 columns. Updated Form 8801.

(20) IRM 3.21.3.7.2(10) Updated information for Form 1040-NR. Added new sequence numbers 07A, 07B, 07C. Added Form 8995-A, Schedule C and Schedule LEP to list of transcribed forms.

(21) IRM 3.21.3.7.2 (10) - Removed Form 461 from sequence of transcribed forms. (IPU 20U0685 issued 06-10-2020)

(22) IRM 3.21.3.7.7(2) Updated editing location for Form 1040-NR.

(23) IRM 3.21.3.7.9(1) Updated editing location for Form 1040-NR.

(24) IRM 3.21.3.8(4) - Updated instructions for editing received dates. (IPU 20U0750 issued 06-29-2020)

(25) IRM 3.21.3.8.1(3) Separated tables into separate paragraphs.

(26) IRM 3.21.3.8.2(1) Removed current year Form 1040-NR-EZ program information.

(27) IRM 3.21.3.8.2(3) and (4) - Corrected the Julian date used to determine received date editing instructions. (IPU 20U0750 issued 06-29-2020)

(28) IRM 3.21.3.8.3(5) - Corrected the Julian date used to determine received date editing instructions. (IPU 20U0750 issued 06-29-2020)

(29) IRM 3.21.3.9(4) - Added new instructions for processing single dollar returns submitted for the Economic Impact Payment (EIP). (IPU 20U0685 issued 06-10-2020 and IPU 20U0694 issued 06-12-2020)

(30) IRM 3.21.3.9(4) Added Stimulus to list of EIP indicators. (IPU 20U0967 issued 09-01-2020)

(31) IRM 3.21.3.9(6) Clarified that work leader will research exchange rates.

(32) IRM 3.21.3.9(8) Moved Suicide Threats from Special Returns to Special Situations.

(33) IRM 3.21.3.9.1(5) Deleted instructions to route packages postmarked before July 1, 2014.

(34) IRM 3.21.3.9.2 Deleted Criminal Investigation subsection due to lack of processing instructions.

(35) IRM 3.21.3.9.3 Deleted subsection for RIVO referral due to improvements in automated filtering.

(36) IRM 3.21.3.11(3) Changed to March to match New Zealand fiscal period for individuals.

(37) IRM 3.21.3.12.1(2) Removed Schedule C-EZ since it must be converted to Schedule C.

(38) IRM 3.21.3.12.2.4(2) Removed Action Code 611.

(39) IRM 3.21.3.12.4.2 Separated City and State into separate subsections to match form updates.

(40) IRM 3.21.3.12.4.3 Separated City and State into separate subsections to match form updates.

(41) IRM 3.21.3.13(2) Added Reminder with a link to prior year processing instructions for Form 1040A and Form 1040EZ.

(42) IRM 3.21.3.15.1.4 Added Line 3a, Qualified Dividends to title.

(43) IRM 3.21.3.15.1.5 Clarified title to match Form 1040.

(44) IRM 3.21.3.15.1.11 Added new paragraph (1).

(45) IRM 3.21.3.15.1.26 Added new subsection for Recovery Rebate Credit.

(46) IRM 3.21.3.16(2) Added a link to instructions for Schedule 1 attached to Form 1040-NR.

(47) IRM 3.21.3.16(3) Updated transcribed lines.

(48) IRM 3.21.3.16.2 Added new subsection for Alimony Received and Date of Divorce.

(49) IRM 3.21.3.16.8(1) Removed obsolete RIVO criteria. (IPU 20U0883 issued 08-07-2020)

(50) IRM 3.21.3.16.8(1) Added new Schedule NEC to table.

(51) IRM 3.21.3.16.9 Added subsection for Educator Expenses.

(52) IRM 3.21.3.16.15 Updated title and line number references.

(53) IRM 3.21.3.16.16 Updated title to include Alimony Recipient’s TIN.

(54) IRM 3.21.3.16.19 - Changed Schedule 1, Line 21 from Reserved line to Tuition and Fees (Form 8917). (IPU 20U0750 issued 06-29-2020)

(55) IRM 3.21.3.16.20(5) - Added new write-in deduction "ED67(e)" . (IPU 20U0750 issued 06-29-2020)

(56) IRM 3.21.3.16.20 (5) - Removed editing for Domestic Production Activity Deduction.

(57) IRM 3.21.3.17(2) Added a link to instructions for Schedule 2 attached to Form 1040-NR.

(58) IRM 3.21.3.17(3) Added transcription lines for Schedule 2.

(59) IRM 3.21.3.18(2) Added a link to instructions for Schedule 2 attached to Form 1040-NR.

(60) IRM 3.21.3.18(3) Updated transcription lines for Schedule 3.

(61) IRM 3.21.3.18.12 Added new subsection for Form 2439 since Form 1040 now provides a separate line.

(62) IRM 3.21.3.18.13 Added new subsection for Sick and Family Leave Credits.

(63) IRM 3.21.3.18.14 Removed reference to Form 2439.

(64) IRM 3.21.3.18.15 Added new subsection for Deferred Taxes.

(65) IRM 3.21.3.18.16 Added new subsection for total line 12f.

(66) IRM 3.21.3.19 Combined with the contents of prior section Editing Form 1040 from Either Form 1040A (2017 and prior) or Form 1040EZ (2017 and prior) to decrease duplicate information.

(67) IRM 3.21.3.19(4) - Added an additional IRM cross-reference. (IPU 20U0750 issued 06-29-2020)

(68) IRM 3.21.3.19.1 Deleted subsection Editing Form 1040 from Either Form 1040A (2017 and prior) or Form 1040EZ (2017 and prior). Unique information moved to 3.21.3.19; duplicate information deleted.

(69) IRM 3.21.3.20(4) Updated with sequence numbers information for 1040-NR attachments.

(70) IRM 3.21.3.23 Moved previous Schedule C-EZ subsection to prior year section and clarified that it should be converted to Schedule C.

(71) IRM 3.21.3.24(1) Added transcription lines for Form 8949.

(72) IRM 3.21.3.28(1) Added paragraph specifying that Section A (Short form) is valid for TY19 and prior only. Removed references to Sections throughout.

(73) IRM 3.21.3.29 Updated transcribed lines for Form 1116.

(74) IRM 3.21.3.29(2) Added instruction to edit Line 1, Schedule 3 if line 1a is reduced to zero due to matching amounts on Form 2555 and Form 1116.

(75) IRM 3.21.3.42 (1) Added paragraph indicating that Form 2555-EZ is valid for TY18 and prior only.

(76) IRM 3.21.3.42.2(1) Removed obsolete RIVO criteria. Added reminder that 2555-EZ is valid for TY18 and prior only. (IPU 20U0883 issued 08-07-2020)

(77) IRM 3.21.3.42.3(1) Added Note that Form 2555-EZ must be converted to Form 2555 for TY19 and later.

(78) IRM 3.21.3.42.5(1) Updated list of countries eligible for waiver of bona fide residence requirements for TY20. (6) Added TY19 instructions if the taxpayer notates a condition preventing them from meeting the physical presence or bona fide residence tests. Added pointers to paragraph 5 throughout. (IPU 20U0685 issued 06-10-2020)

(79) IRM 3.21.3.43.5(6) Clarified instructions for editing physical presence dates if Revenue Procedure 2020-27 is referenced. (IPU 20U0694 issued 06-12-2020)

(80) IRM 3.21.3.48 Added T-lines. Deleted MID indicator from T-lines.

(81) IRM 3.21.3.53 Moved sequence code definitions into new paragraph (1).

(82) IRM 3.21.3.55 Updated T-Lines and T-Compute lines for Forms 8995 and Form 8995-A. Added Form 8995-A Schedule C.

(83) IRM 3.21.3.63 Deleted previous subsection for Form 461 as it is not a transcribed form.

(84) IRM 3.21.3.69(1) Clarified when to use Sequence 74.

(85) IRM 3.21.3.72 Added new reserved section for Schedule LEP.

(86) IRM 3.21.3.73.1(1) Removed duplicated information on AS filing requirements.

(87) IRM 3.21.3.73.1(5) Added information on taxpayers who are not bona fide residents.

(88) IRM 3.21.3.73.1.1(1) Updated correspondence instructions to clarify actions tax examiners are responsible for.

(89) IRM 3.21.3.73.1.2(7) Removed instructions to convert Form 1040A and Form 1040EZ.

(90) IRM 3.21.3.73.1.3(1) Removed instructions to convert Form 1040A and Form 1040EZ.

(91) IRM 3.21.3.74.1.1(1) Updated correspondence instructions to clarify actions tax examiners are responsible for.

(92) IRM 3.21.3.74.1.1(3) Removed prior (3). Instructions to continue processing unnecessary as no instruction to stop processing identified.

(93) IRM 3.21.3.75.1.1(1) Updated correspondence instructions to clarify actions tax examiners are responsible for.

(94) IRM 3.21.3.75.1.2 (3) through (5) Revised to clarify that Audit Code L is required if Form 5074 is present, and when action is required if Form 5074 is not present. (IPU 20U0873 issued 08/04/2020).

(95) IRM 3.21.3.75.1.1(3) Removed prior (3). Instructions to continue processing unnecessary as no instruction to stop processing identified.

(96) IRM 3.21.3.75.1.2 (3) through (5) Revised to clarify that Audit Code L is required if Form 5074 is present, and when action is required if Form 5074 is not present. Revised title of figure for consistency. (IPU 20U0873 issued 08/04/2020).

(97) IRM 3.21.3.76.1.1(1) Updated correspondence instructions to clarify actions tax examiners are responsible for.

(98) IRM 3.21.3.76.2 (7) Added new paragraph with instructions to edit SPC "B" to suppress taxpayer notices. (3) and (8) Added SPC to the list. (IPU 20U1040 issued 09/23/2020)

(99) IRM 3.21.3.76.1.3 Combined with prior IRM 3.21.3.76.1.3.1.

(100) IRM 3.21.3.76.1.3.1 Deleted Processing Form 1040 (Form 1040-SR) in Compliance with Notice 2007-19 subsection and moved contents to 3.21.3.76.1.3.

(101) IRM 3.21.3.76.1.4 Combined with prior IRM 3.21.3.76.1.4.1.

(102) IRM 3.21.3.76.1.4.1 Processing Form 1040 (Form 1040-SR) in Compliance with Notice 2007-31 subsection and moved contents to 3.21.3.76.1.4

(103) IRM 3.21.3.77.1(1) Deleted duplicated information on filing requirements.

(104) IRM 3.21.3.77.3(1) Added instructions for determining if taxpayer is a bona fide resident of Puerto Rico.

(105) IRM 3.21.3.78(4) Deleted duplicate table and added a reference to IRM 3.21.3.78.3 instead.

(106) IRM 3.21.3.78.1(1) Added new T-lines to table.

(107) IRM 3.21.3.78.3.2 (3) Updated list of qualifying relationships to include half-sister and half-brother.

(108) IRM 3.21.3.78.3.3 Updated throughout to reflect that Section A of Schedule SE exists only for TY19 and prior.

(109) IRM 3.21.3.78.3.11 Added new subsection for Deferral.

(110) IRM 3.21.3.78.3.12(4) Added new paragraph with instructions for write-in "SLFLC."

(111) IRM 3.21.3.78.3.18(2) Updated note to reflect additional transcription.

(112) IRM 3.21.3.78.7.8(1) Added a link to prior year amounts.

(113) IRM 3.11.3.78.8(1) Added a note that Section A of Schedule SE must be converted to Section B for transcription.

(114) IRM 3.21.3.79(1) Added a paragraph clarifying that Form 1040-NR-EZ is valid for TY18 and prior.

(115) IRM 3.21.3.79(4) Updated return due dates.

(116) IRM 3.21.3.79(5) Removed Action Code 611.

(117) IRM 3.21.3.79 Added a paragraph clarifying that Form 1040-NR-EZ is valid for TY18 and prior. Updated return due dates.

(118) IRM 3.21.3.80(2) Clarified that returns with amounts in foreign currency should be given to the workleader, as tax examiners are unable to perform online research.

(119) IRM 3.21.3.80.2(1) Removed A-3 visa, which does not qualify as a Government Service employee.

(120) IRM 3.21.3.81.2(1) Added new paragraph explaining that Schedules 1,2, and 3 are valid for 1040-NR in TY20 and later, and describing the change to sequence number/name of Schedule A (1040-NR), Schedule NEC, and Schedule OI.

(121) IRM 3.21.3.81.2(2) Added new paragraph specifying that Form 1040-NR-EZ is valid for TY19 and prior only.

(122) IRM 3.21.3.81.2(3) Updated T-lines for Form 1040-NR. Moved T-lines for supporting schedules and Form 1040-NR-EZ to their new pages.

(123) IRM 3.21.3.84.6(3) Moved Note into appropriate box in table. Created new table showing filing status numbers to filing status descriptions to match format on Form 1040-NR. Retained existing table to aid in processing prior year forms.

(124) IRM 3.21.3.81.6(1) Updated editing location for FSC.

(125) IRM 3.21.3.81.6(3) Moved table to prior year filing status code instructions.

(126) IRM 3.21.3.81.7 Removed reference to obsolete figures.

(127) IRM 3.21.3.81.7.1(3) Moved note below the table into the appropriate box.

(128) IRM 3.21.3.81.8.3(2) Removed A-3 visa, which does not qualify as a Government Service employee.

(129) IRM 3.21.3.81.8.11 Added a new subsection to match additional line on Form 1040-NR. Added instructions that when an amount is present, Schedule 1 must be present.

(130) IRM 3.21.3.81.9.1 Added new section for line 10a of Form 1040-NR.

(131) IRM 3.21.3.81.9.2 Added new section for new line 10b on Form 1040-NR.

(132) IRM 3.21.3.81.10 Removed instruction to edit certain lines in dollars only as this information is provided elsewhere.

(133) IRM 3.21.3.81.10.1 Deleted previous Line 36 subsection.

(134) IRM 3.21.3.81.10.1(2) Added paragraph with instructions for determining if the taxpayer is a student of business apprentice.

(135) IRM 3.21.3.81.10.4 Added new subsection for total line 13c of Form 1040-NR.

(136) IRM 3.21.3.81.10.5 Added new subsection for total line 14 of Form 1040-NR.

(137) IRM 3.21.3.81.11 Removed instruction to edit certain lines in dollars only as this information is provided elsewhere.

(138) IRM 3.21.3.81.11.2 Added new subsection for total line 20.

(139) IRM 3.21.3.81.12 Removed instruction to edit certain lines in dollars only as this information is provided elsewhere.

(140) IRM 3.21.3.81.12.2 Added new subsection for total line 23b.

(141) IRM 3.21.3.81.12.4 Added new subsection for total line 23d.

(142) IRM 3.21.3.81.13.1 Added new reserved subsection for lines 25a - 25c, W-2 withholding, 1099-withholding, and other withholding.

(143) IRM 3.21.3.81.13.2(4) Updated note due to variable IRP availability.

(144) IRM 3.21.3.81.13.2(8) Removed criteria for RIVO referral due to improvements in automated filtering. (IPU 20U0967 issued 09-01-2020)

(145) IRM 3.21.3.81.13.7 Added new subsection for reserved line 27.

(146) IRM 3.21.3.81.13.11 Added new subsection for total line 31.

(147) IRM 3.21.3.81.13.12 Added new reserved subsection for total line 32.

(148) IRM 3.21.3.81.14 (3) and (4) Removed duplicated T-line and T-compute information.

(149) IRM 3.21.3.81.17(2) Updated editing location.

(150) IRM 3.21.3.81.19 Added new subsection for Schedule 1, Form 1040-NR.

(151) IRM 3.21.3.81.19.2 Added new subsection for Schedule 1, lines 2a and 2b due to changes to Form 1040-NR.

(152) IRM 3.21.3.81.19.10 Added new section for Line 11, with instructions to X amounts if present on Form 1040-NR.

(153) IRM 3.21.3.81.19.16 Added new section for Schedule 1, Line 17, with instructions to X amounts if present on Form 1040-NR.

(154) IRM 3.21.3.81.19.17 Added new section for Schedule 1, Lines 18a - 18c.

(155) IRM 3.21.3.81.19.20 Added new section for Schedule 1, Line 21.

(156) IRM 3.21.3.81.19.21 Moved editing instructions for Dotted Portion (Miscellaneous Adjustments) from line 10d to Schedule 1, Line 22.

(157) IRM 3.21.3.81.19.21(4) Deleted DPAD. Added new write-in deduction "ED67(e)" . (IPU 20U0750 issued 06-29-2020).

(158) IRM 3.21.3.81.19.22 Added new section for Schedule 1, Line 22.

(159) IRM 3.21.3.81.20 Added new subsection for Schedule 1, Form 1040-NR.

(160) IRM 3.21.3.81.20.3 Added new reserved section for Schedule 2, Line 3.

(161) IRM 3.21.3.81.20.9(1) and (2) Deleted prior paragraphs 1 and 2 as duplicate information.

(162) IRM 3.21.3.81.20.10 Added new section for line 9, Schedule 2.

(163) IRM 3.21.3.81.20.12 Added new reserved section for line 10, Schedule 2.

(164) IRM 3.21.3.81.21 Added new subsection for Schedule 3 when filed with Form 1040-NR.

(165) IRM 3.21.3.81.21.3 Added new section for line 3, Schedule 3, with instructions to X amount when claimed on Form 1040-NR

(166) IRM 3.21.3.81.21.7 Added new reserved section for line 7, Schedule 3, when claimed on Form 1040-NR.

(167) IRM 3.21.3.81.21.12 Added new subsection for Form 2439.

(168) IRM 3.21.3.81.21.13 Added new subsection for the Sick and Family Leave Credits.

(169) IRM 3.21.3.81.21.14 Added new subsection for the Health Coverage Tax Credit.

(170) IRM 3.21.3.81.21.15 Updated to reflect line 12d, Other credits.

(171) IRM 3.21.3.81.21.16 Added new subsection for 12e, Deferral for Schedule H or Schedule SE.

(172) IRM 3.21.3.81.21.17 Added new subsection for 12f, Total of 12a through 12e.

(173) IRM 3.21.3.81.21.16 Added new reserved section for line 13, Schedule 3.

(174) IRM 3.21.3.81.22 Added table containing transcription lines. Added sequence number 7a and updated line numbers throughout. Updated standard deduction amounts in (6)

(175) IRM 3.21.3.81.23 Added table containing transcription lines. Added sequence number 7b and updated line numbers throughout. Updated standard deduction amounts in (6)

(176) IRM 3.21.3.82 Removed Form 1040-NR-EZ instructions and all subsections to prior year instructions.

(177) IRM 3.21.3.83.1 Updated tax periods which qualify as prior year throughout.

(178) IRM 3.21.3.83.2(1) Clarified the legal statute of limitations.

(179) IRM 3.21.3.83.3(4) Removed old instructions for renumbering Form 1040A and Form 1040EZ.

(180) IRM 3.21.3.83.3.1(1) Deleted conversion instructions for Form 1040A and Form 1040EZ.

(181) IRM 3.21.3.83.3.1.1(1) Deleted prior paragraphs (1) through (3) since information matched current year processing.

(182) IRM 3.21.3.83.3.1.1(2) Removed date checks from countries for consistency with pipeline processing.

(183) IRM 3.21.3.83.3.1.2 Added Schedule C-EZ instructions to prior year information.

(184) IRM 3.21.3.83.3.1.3(1) and (2) Deleted prior paragraphs as duplicate of current year information.

(185) IRM 3.21.3.83.3.2 Updated the maximum income amount for TY19. Removed information for 1981 through 1979. Added TY19 waiver countries.

(186) IRM 3.21.3.83.3.4.1(3) Added the maximum Social Security amount for TY19.

(187) IRM 3.21.3.83.3.5(1) and (2) Added information on reformatting of Form 1040-NR for TY20.

(188) IRM 3.21.3.83.3.5.4(1) Moved tables from Current Year filing status page as instruction no longer applies for CY returns.

(189) IRM 3.21.3.83.3.5.5 Renamed subsection from Exemptions to Dependents for consistency. Removed obsolete editing instructions.

(190) IRM 3.21.3.83.3.5.5.1 Deleted prior Dependent Status Indicator subsection as obsolete.

(191) IRM 3.21.3.83.3.5.5.1 Renamed subsection from Exemption Coding to Dependent Coding for consistency.

(192) IRM 3.21.3.83.3.5.8 Added subsection for prior year Schedule C-EZ instructions.

(193) IRM 3.21.3.83.3.5.10 Deleted obsolete Making Work Pay/Government Retiree Credit subsection and Page 3, Schedule A - Unreimbursed Employee Expenses subsection.

(194) IRM 3.21.3.83.3.6(1) Updated to clarify the requirements for professional gamblers are separate.

(195) IRM 3.21.3.83.3.6(2) Removed dates from table for pipeline consistency.

(196) IRM 3.21.3.83.3.7(2) Added instructions to convert Form 1040-NR-EZ if TY20 or later.

(197) IRM 3.21.3.83.3.7(4) Added Form 1040-NR-EZ T-lines and T-Compute lines.

(198) IRM 3.21.3.83.3.7.1(1) Added instruction to convert Form 1040-NR-EZ for TY20 or later.

(199) IRM 3.21.3.83.3.7.3.4(2) Removed A-3 visa, which is not eligible as a Government Service Employee.

(200) IRM 3.21.3.83.3.7.7.1(4) Clarified instructions for researching IRP due to variable availability.

(201) IRM 3.21.3.85(6) Updated instructions for e-mailing Excel workbooks.

(202) Exhibit 3.21.3-1 Updated Edit Date for Form W-7. Updated Form 461 instructions. (IPU 20U0685 issued 06-10-2020)

(203) Exhibit 3.21.3-1 Removed forms listed as "take no action." Updated instructions for CP 01A. Updated instructions for Form 13441-A. Added instructions for Form 14095. Updated addresses for Form 390 AS and Form 1040GUAM. Added Form 7202, Form 8993, and Form 9000. Replaced instructions for Form 8938 with a link to IRM 3.11.3.

(204) Exhibit 3.21.3-9 Converted graphics to table.

(205) Exhibit 3.21.3-10 Converted graphics to table.

(206) Exhibit 3.21.3-11 Corrected title.

(207) Exhibit 3.21.3-12 Converted graphics to table.

(208) Exhibit 3.21.3-20 Added the Economic Impact Payment and Recovery Rebate Credit to the glossary.

(209) Editorial changes have been made throughout this IRM, including:

  • Correcting grammar, spelling, and punctuation.

  • Adding or correcting references and citations.

  • Removing references to the valid year of a tax form when its presence will make no difference to processing.

  • Removing references to prior year forms 1040A, 1040EZ, 1040-SR, 1040-NR-EZ, Form 2555-EZ, Schedule SE (Section A), and Schedule C-EZ when not specifically applicable.

  • Moving subsections into order based on current year forms and schedules.

  • Moving subsections into prior year information as needed.

  • Updating line number references to reflect current year forms.

  • Adjusting dollar amounts to current year thresholds/maximums.

  • Simplified language and formatting where possible.

  • Rewriting and reorganizing existing information for clarity which do not alter the actions to be taken.

Effect on Other Documents

IRM 3.21.3, dated April 24, 2020 (effective April 24, 2020) is superseded. The following Interim Procedural Updates (IPUs) issued from April 24, 2020 through September 23, 2020 have been incorporated into this IRM: 20U0685, 20U0694, 20U0750, 20U0873, 20U0883, 0U0967, and 20U1040.

Audience

Wage and Investment (W&I) Code and Edit Tax Examiners

Effective Date

(01-01-2021)

James L Fish
Director, Submission Processing
Wage and Investment Division

Program Scope and Objectives

  1. Purpose: The Document Perfection Operation, Code & Edit unit, prepares paper returns for processing by reviewing and editing the documents with specialized processing codes for use downstream. This Internal Revenue Manual (IRM) provides instructions for coding and editing international individual income tax returns for transcription and validation. IRM 3.11.3, Individual Income Tax Returns, must be used for ALL International returns. When specific international processing instructions are not provided in IRM 3.21.3, tax examiners will use the general processing instructions in IRM 3.11.3.

  2. Audience: Tax examiners in the Wage and Investment Division (W&I), Austin Submission Processing Service Center, Code & Edit Units are the primary users of this IRM.

  3. Policy Owner: The Director of Submission Processing is responsible for the policies in this IRM.

  4. Program Owner: The Code & Edit/ERS IMF Section of the Paper Processing Branch of Submission Processing is responsible for the procedures and all updates related to this IRM.

  5. Primary Stakeholders: Submission Processing (SP).

  6. Program Goals: To timely review and edit all returns received in Code & Edit (C&E).

Background

  1. This section of the Internal Revenue Manual (IRM) provides instructions for coding and editing individual income tax returns for transcription and validation. Special codes are used to perform specific functions. Editing is necessary because many returns are incomplete, contain invalid or misplaced entries, or are computed incorrectly.

  2. This IRM contains instructions for processing international returns using the following form types:

    • Form 1040, U.S. Individual Income Tax Return

    • Form 1040 (SP), Declaración de Impuestos de los Estados Unidos Sobre los Ingresos Personales

    • Form 1040-SR, U.S. Tax Return for Seniors

    • Form 1040-SR (SP), Declaración de Impuestos de los Estados Unidos para Personas de 65 Años de Edad o Más

    • Form 1040A, U.S. Individual Income Tax Return (tax year 2017 and prior only)

    • Form 1040EZ, Income Tax Return for Single and Joint Filers with No Dependents (tax year 2017 and prior only)

    • Form 1040-NR, U.S. Nonresident Alien Income Tax Return

    • Form 1040-NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens With No Dependents (tax year 2019 and prior only)

    • Form 1040-SS, U.S. Self-Employment Tax Return (Including the Additional Child Tax Credit for Bona Fide Residents of Puerto Rico)

    • Form 1040-PR, Planilla para la Declaración de la Contribución Federal sobre el Trabajo por Cuenta Propia (Incluyendo el Crédito Tributario Adicional por Hijos para Residentes Bona Fide de Puerto Rico)

    • Supporting forms and schedules for the forms listed above

    Reminder:

    IRM 3.11.3, Individual Income Tax Returns, must be used to process returns when specific instructions are not provided in this IRM.

Authority

  1. Authority for these procedures is found in the following sections of the Internal Revenue Code and their corresponding Treasury regulations:

    • IRC 6201(a)

    • IRC 6213(b)

    • IRC 6402(a)

    • IRC 6511

  2. Policy Statements for Submission Processing are contained in IRM 1.2.1, Servicewide Policy Statements.

Responsibilities

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

  2. The Document Perfection Operations Manager is responsible for monitoring operational performance for the Code and Edit operation.

  3. The Code & Edit Team Managers and Leads are responsible for performance monitoring and ensuring tax technicians have the tools to perform their duties.

  4. The tax technicians are responsible for following the instructions contained in this IRM, including all IRM procedural updates (IPU) posted to the SERP (Servicewide Electronic Research Program) website.

Program Management and Review

  1. Program Reports: The Monitoring Section under Submission Processing Program Management/Process Assurance monitors the Code & Edit reports.

  2. Program Effectiveness: The program goals are measured by the following reviews:

    • Embedded Quality Submission Processing (EQSP)

    • Balanced Measures

    • Managerial Reviews

  3. Annual Review: The processes included in this manual are reviewed annually to ensure accuracy and promote consistent tax administration.

Terms and Definitions

  1. See Exhibit 3.21.3-20 for the glossary of frequently used terms.

Related Resources

  1. International Job Aid 2513-701, Coding and Editing International Income Tax Returns, was developed as a reference guide for this manual. This manual refers the tax examiner to clarifying information or exhibits in the Job Aid, where appropriate. When conflict between any referenced material and the IRM instructions occur, the IRM instructions take precedence.

IRM Deviations

  1. IRM deviations must be submitted in writing following instructions from IRM 1.11.2.2, Internal Management Documents System - Internal Revenue Manual (IRM) Process, IRM Standards, and elevated through appropriate channels for executive approval.

International Returns

  1. International tax returns are identified by the presence of one of the following:

    • An address outside the 50 United States and Washington D.C.

      Exception:

      This does not include APO(Army/Air Post Office)/DPO (Diplomatic Post Office)/FPO (Fleet Post Office) addresses

    • Form 390 (American Samoa), American Samoa Individual Income Tax Return

    • Form 482.0/Formulario 482 (Puerto Rico), Planilla de Contribución Sobre Ingresos de Individous

    • Form 1040CM (CNMI), Commonwealth of the Northern Mariana Islands Territorial Individual Income Tax

    • Form 1040 GUAM, Guam Individual Income Tax Return

    • Form W-2 from American Samoa (W-2AS)

    • Form W-2 from CNMI (W-2CM)

    • Form W-2 from Guam (W-2GU)

    • Form W-2 from Virgin Islands (W-2VI)

    • Form 499R-2/W-2PR (Puerto Rican Withholding)

    • Form 1040-NR, U.S. Nonresident Alien Income Tax Return

    • Form 1040-NR-EZ, U.S. Income Tax Returns for Certain Nonresident Aliens With No Dependents

    • Form 1040-PR, Planilla para la Declaración de la Contribución Federal sobre el Trabajo por Cuenta Propia (Incluyendo el Crédito Tributario Adicional por Hijos para Residentes Bona Fide de Puerto Rico)

    • Form 1040-SS, U.S. Self-Employment Tax Return

    • Form 1042-S, Form SSA-1042S, or Form RRB-1042S

    • Form 2555, Foreign Earned Income

    • Form 2555-EZ, Foreign Earned Income Exclusion

    • Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa

    • Form 5074, Allocation of Individual Income Tax to Guam or the Commonwealth of the Northern Mariana Islands (CNMI)

    • Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property Interests

    • Form 8689, Allocation of Individual Income Tax to the U.S. Virgin Islands

    • Form 8804, Annual Return for Partnership Withholding Tax Under Section 1446

    • Form 8805, Foreign Partner's Information Statement of Section 1446 Withholding Tax

    • Form 8813, Partnership Withholding Tax Payment

    • Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b)

    • Form 8854, Initial and Annual Expatriation Information Statement

    • Form 8898, Statement for Individuals Who Begin or End Bona Fide Residency in a United States Possession

    • Form 14653, Certification by U.S. Person Residing Outside of the United States for Streamlined Foreign Offshore Procedures

    • Form 14654, Certification by U.S. Person Residing in the United States for Streamlined Domestic Offshore Procedures

    • Dual Status (any of the following):
      - Form 1040 and Form 1040-NR filed together for the same tax year

      Note:

      Do not treat as Dual Status if Form 1040 is filed with 1040-NR Schedule OI attached.


      - "Dual Status" or "D/S" indicated on the return
      - Taxpayer claims part year residence and part year non - residence.

      Caution:

      Always leave Form 1040 and Form 1040-NR for the same taxpayer together.

    • Nonresident Alien (NRA): Either primary or both taxpayers are Nonresident Alien

      Exception:

      Do not treat as a nonresident alien if the primary taxpayer is a Nonresident Alien (NRA) without a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN) and the secondary taxpayer has an SSN/ITIN and is reporting income.

    • International Tax Treaty: taxpayer indicating exemption or exclusion of tax and/or income due to an International Tax Treaty.

      Exception:

      Do not treat as international if the taxpayer claims exemption due to an American Indian treaty and no other international condition exists.

    • Treaty Trader

    • Fulbright Grantee

    • IRC 871, IRC 893, IRC 911, IRC 913, IRC 931, IRC 932, IRC 933, IRC 934 or IRC 935 are notated anywhere on the return.

    • Notation of "Streamlined" on the return or other Streamlined certification

    Caution:

    If none of the International conditions listed above are present, consider it a domestic return and process it accordingly.

  2. Do not treat returns that convert income paid in foreign currency to U.S. currency as international returns unless additional international criteria are present.

    Example:

    Canadian dollars converted to U.S. dollars

  3. If a numbered return assigned international File Location Code (FLC) 20 or 21 does not meet the definition of an international return, edit Action Code "610" to have a new Document Locator Number (DLN) assigned.

Form 1042 and Form 1042-S

  1. Form 1042 and Form 1042-S are used by withholding agents to report tax withheld at the source on certain income paid to foreign persons (nonresident alien individuals, foreign partnerships, foreign corporations or foreign trusts and estates) that is not effectively connected with the conduct of a trade or business in the United States. Form 1042-S is a withholding document that identifies, by type, income that is subject to U.S. tax withholding and that is paid to nonresident aliens by U.S. payers.

  2. See Exhibit 3.21.3-2, Form 1042-S Income Codes, to determine where the provided Income Code is to be reported on Form 1040-NR.

  3. If Form 1042-S is attached to Form 1040:

    If And Then
    Refund return and the only income is from the Form 1042-S Both are true:
    • Taxpayer does not state they are a U.S. resident alien, and

    • Taxpayer does not provide a copy of their resident alien card.

    Correspond for the filer's U.S. status using Form 9143, box 24.
    Refund return and the only income is from the Form 1042-S Either is true:
    • Taxpayer states they are a U.S. resident alien, or

    • Taxpayer does provide a copy of their resident alien card.

    1. Delete Form 1042-S withholding from line 25a - 25d (where found)

    2. Edit Form 1042-S withholding to the dotted portion of line 33.

    Worldwide income is reported or the return is other than a refund  
    1. Delete Form 1042-S withholding from line 25a - 25d (where found)

    2. Edit Form 1042-S withholding to the dotted portion of line 33.

    .

International Filers Overview

  1. Individuals may be expected to file international returns for a variety of conditions. More than one condition may be met by a single taxpayer. Generally:

    • Taxpayers who are treated as resident aliens file Form 1040.

    • Taxpayers who are treated as nonresident aliens file Form 1040-NR.

      Note:

      Special filing requirements often apply to U.S. territories.

  2. U.S. citizens living/traveling outside of the United States: They are generally required to file U.S. income tax returns on which they must report their worldwide income.

  3. Resident Alien: A foreign individual who meets either the green card test or the substantial presence test for the calendar year.

  4. Nonresident Alien: A foreign individual who does not meet either the green card test or the substantial presence test for the calendar year, unless:

    1. They choose to be treated as a resident alien for part of the calendar year by making the First-Year Choice (see IRM 3.21.3.3.2 (12), or

    2. They are a nonresident married to a U.S. citizen or resident alien. They and their spouse may be able to make a joint election under IRC 6013(g) or (h) to treat the individual as a resident alien for the entire calendar year. See IRM 3.21.3.3.2 (12) and IRM 3.21.3.3.2 (13) below.

  5. Green Card Test: The individual is a resident alien once they are issued a Permanent Resident Card, also known as a green card as a lawful permanent resident of the U.S. Lawful permanent residency continues unless revoked or determined to be abandoned. A lawful permanent resident may be treated as a nonresident alien for U.S. income tax purposes if they are both a U.S. resident alien and a resident of a foreign country under its laws. In this situation, the taxpayer would claim treatment as a resident of the foreign country under the tie-breaker rules of an income tax treaty.

  6. Substantial Presence Test: The individual is treated as a resident alien for the calendar year if they are physically present for at least:

    1. 31 days during the current tax year; and

    2. 183 days during the 3 year period that includes the current tax year and 2 years immediately before that, counting:
      1) All the days of physical presence in the tax year,
      2) 1/3 of days of physical presence in the first year prior to the current tax year, and
      3) 1/6 of the number of days of physical presence in the second year prior to the current tax year.

  7. Exceptions to the Substantial Presence Test: The following days of presence in the United States do not count for the substantial presence test:

    • Days commuting to work in the United States from a residence in Canada or Mexico if they "commute regularly." They "commute regularly" if they commute to work in the United States on more than 75% of the workdays during a working period in the current year.

    • Days in the United States for less than 24 hours when in transit between two places outside the United States.

    • Days in the United States as a crew member of a foreign vessel engaged in transportation between the United States and a foreign country or a U.S. territory.

      Note:

      This exception doesn't apply if otherwise engaged in any trade or business in the United States on those days.

    • Days they intended to leave, but couldn't leave the United States because of a medical condition or medical problem that arose while in the United States. Whether they intended to leave the United States on a particular day is determined based on all the facts and circumstances.

      Note:

      Additional criteria apply for TY19. See IRM 3.21.3.42.5 for information on determining physical presence.

    • Days the individual is an "exempt individual."

  8. Exempt Individuals for the Substantial Presence Test: An individual is an "exempt individual" if any of the following are true:

    • An individual is temporarily present in the United States as a foreign government-related individual under an A or G visa.

      Exception:

      Excludes household staff of a foreign government-related individual present in the United States under an A-3 or G-5 visa.

    • A teacher or trainee temporarily present in the United States under a J or Q visa. See IRM 3.21.3.3.2 (9) and IRM 3.21.3.3.2 (10) for additional information.

    • A professional athlete temporarily present in the United States to compete in a charitable sports event.

  9. An individual is not an exempt individual as a teacher or trainee if they were exempt as a teacher, trainee, or student for any part of 2 of the 6 preceding calendar years, unless all are true:

    • The individual was exempt as a teacher, trainee, or student for any part of 3 (or fewer) of the 6 preceding calendar years

    • A foreign employer paid all compensation during the current year

    • They were present in the United States as a teacher or trainee in any of the prior 6 years

    • A foreign employer paid all compensation during each of the preceding 6 years the individual was present in the United States as a teacher or trainee.

  10. A student temporarily present in the United States under an F, J, M, or Q visa is not an exempt individual as a student in the current year if they have been exempt as a teacher, trainee, or student for any part of more than 5 calendar years unless both are true:

    • The individual establishes that they do not intend to reside permanently in the United States.

    • They substantially complied with the requirements of their visa.

  11. Closer Connection Exception: Individuals who meet the substantial presence test may still be treated as nonresident aliens if all of the following are true:

    1. They are present in the United States for fewer than 183 days during the current calendar year

    2. They maintain a tax home in a foreign country during the year

    3. They have a closer connection to that country than to the United States

    4. They timely file Form 8840, Closer Connection Exception Statement for Aliens, claiming to have a closer connection to a foreign country or countries.

      Note:

      An individual may not claim a closer connection to a foreign country if they have applied for status as a lawful permanent resident of the United States or have an application pending for adjustment of status. Some tax treaties provide special rules for determining residency.

  12. First-Year Choice: A foreign individual who does not meet the green card test or the substantial presence test may be treated as a resident alien for part of a calendar year by making the First-Year Choice.

  13. Married to a U.S. citizen or resident alien: A foreign individual who does not meet the green card test or substantial presence test may be able to choose to be treated as a resident alien if the individual is a nonresident alien married to a U.S. citizen or resident alien, the individual and their spouse may be able to make a joint election under IRC 6013(g) or (h).

  14. Individuals from a U.S. Territory:

    1. American Samoa, see IRM 3.21.3.73.

    2. Guam, see IRM 3.21.3.74.

    3. Commonwealth of Northern Mariana Islands, see IRM 3.21.3.75.

    4. U.S. Virgin Islands, see IRM 3.21.3.76.

    5. Puerto Rico, see IRM 3.21.3.77.

  15. Effectively Connected Income: Nonresident aliens are taxed on both:

    1. U.S. source income if the U.S. tax due has not been fully withheld

    2. Income effectively connected with a U.S. trade or business.

  16. Tax Treaties: The U.S. has income tax treaties with a number of countries. Under these treaties, nonresident aliens who are residents of the foreign country may be taxed at a reduced rate or exempt from U.S. income taxes on certain types of income from sources in the United States. An individual is a resident of a foreign country under an income tax treaty if they are treated as a resident under the domestic laws of that country for income tax purposes. Some treaties include requirements beyond citizenship to establish residency for treaty purposes, such as physical presence within the purported residence country. See IRM 3.21.3.80.7 for more information about tax treaties.

  17. Dual-Status Taxpayers: An individual who is both a resident alien and nonresident alien in the United States within the same tax year. This usually occurs in the year the taxpayer arrived in or departed from the United States. The taxpayer will submit both Form 1040 and Form 1040-NR with Dual-Status Return written across the top of the return for the tax year. The form filed as the return is based on the taxpayer's residence on the last day of the year.

    1. If the individual is a resident of the U.S. on the last day of the tax year, they will file Form 1040 with a statement attached (such as a Form 1040-NR) for the portion of the year that they were a nonresident alien.

    2. If the individual is not a resident of the U.S. on the last day of the tax year, they will file Form 1040-NR with a statement attached (such as a Form 1040) for the portion of the year they were a resident alien.

  18. U.S. Citizens and U.S. Resident Aliens Living Abroad Who Qualify for the IRC 911 Foreign Earned Income Exclusion: A taxpayer who meets the specific requirements of IRC 911(b)(2)(D) may claim an exclusion of foreign earned income up to the maximum allowed for the tax year and either the housing exclusion or the housing deduction if the taxpayer has a tax home in a foreign country or countries and the taxpayer is one or more of the following:

    1. A U.S. citizen who has been a bona fide resident of a foreign country or countries for an uninterrupted period (regardless of physical presence) that includes an entire taxable year

    2. A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty with an applicable nondiscrimination clause, and who is a bona fide resident of a foreign country for an uninterrupted period that includes an entire year

    3. A U.S. resident alien who has been physically present in a foreign country or countries for 330 days during a period of 12 consecutive months.

Visas Overview

  1. A U.S. visa allows a foreigner to live permanently in the United States, (immigrant visa,) or travel to the United States on a temporary basis for specific purposes and periods of time (nonimmigrant visa). See Exhibit 3.21.3-8 for a list of nonimmigrant visa types.

  2. Most but not all nonimmigrant visa holders are taxed as nonresident aliens.

    1. A nonresident alien is taxed on all United States source income and on all income that is effectively connected with the conduct of a trade or business in the United States. Unlike U.S. citizens, non-effectively connected foreign source income is not taxed.

    2. Resident aliens are generally taxed on worldwide income, like U.S. citizens.

U.S. Income Reporting Requirements Overview

  1. United States citizens and resident aliens: They are generally required to file Form 1040 and must report 100% of their worldwide income. Worldwide income is income from ALL sources, including foreign and U.S. income reported on Form 1040, lines 1 through 6 and Schedule 1, lines 1 through 8. For information on identifying resident aliens, see IRM 3.21.3.3.2, International Filers Overview.

  2. Nonresident Aliens: They are generally required to file Form 1040-NR to report only:

    • U.S. source income, if the amount of tax withheld didn't satisfy the tax due

    • Income effectively connected to a U.S. trade or business

  3. A nonresident alien not otherwise engaged in a U.S. trade or business is not required to report U.S. source income that was withheld properly at the source or any foreign source income that is not effectively connected to a U.S. trade or business but may file to claim a refund for overpaid taxes. Generally, income received from U.S. payers constitutes U.S. source income. Income received from foreign payers may also constitute U.S. source income in certain circumstances, such as income received for services performed in the U.S. or income received for the use of intangibles in the U.S.

    Exception:

    U.S. tax laws exempt nonresident aliens from U.S. taxation on interest earned on certain deposits, which are not effectively connected with a trade or business.

  4. U.S. source income is reported on Form 1042-S, Form W-2, Form SSA-1042S, Form RRB-1042S, Form 1099 series, Form 8805, Form 8288-A, or a statement of income.

  5. U.S. source income which is not effectively connected to a U.S. trade or business is generally taxed at 30% unless a tax treaty exists between the U.S. and the taxpayer's foreign country of residence that either reduces the rate or exempts the income.

  6. When Scholarship/Fellowship income is paid to a nonresident alien from a country that does not have a tax treaty with the United States:

    • It is not exempted

    • It is reported on Form 1042-S and attached to the return, if paid by a U.S. payor.

    • It must be reported on line 1b, Form 1040-NR.

    • If the individual is a "degree candidate," amounts paid to a qualified educational institute for tuition and education related expenses (such as fees, books, supplies, and equipment) may be deducted on line 10c, Form 1040-NR.

    • If the individual is not a "degree candidate," the full amount of the scholarship or fellowship is generally taxable.

  7. When Scholarship/Fellowship income is paid to a resident alien (because of the substantial presence test) or nonresident alien who was a resident of a tax treaty country immediately before coming to the U.S. to study:

    • It may be fully or partly excluded under a tax treaty.

    • It is reported on Form 1042-S and attached to the return, if paid by a U.S. payor.

    • It must be reported on line 1b, Form 1040-NR if taxable, or on line 1c, Form 1040-NR if exempt by treaty.

    • Question "L," Schedule OI must be answered.

    • The validity of the tax treaty benefit claimed must be verified.

Form 1040 with Schedule 1 and Form 2555 or Form 2555-EZ Attached

  1. For processing instructions, see IRM 3.21.3.42

  2. Form 2555 is valid for all tax years. Form 2555-EZ is valid for TY18 and prior.

  3. Form 2555 must be attached if any of the following indicators are on Form 1040 or Schedule 1:

    • IRC 911 exclusion

    • Notation of Form 2555 or Form 2555-EZ

    • Foreign Housing Exclusion on Schedule 1, line 8 (negative amount)

    • Foreign Earned Income Exclusion on Schedule 1, line 8 (negative amount)

    • Foreign Housing Deduction on dotted portion of Schedule 1, line 22

  4. A taxpayer with foreign earned income is entitled to claim the following on Form 2555:

    • Foreign Earned Income Exclusion (Part VII), and/or

    • Housing Deduction, if housing is paid for with earnings from self-employment (Parts VI and IX), or

    • Housing Exclusion, if housing is paid for with employer-provided amounts, such as wages, housing allowance, etc.(Parts VI and VIII).

  5. A U.S. citizen or U.S. resident alien living and working in a foreign country may use Form 2555 to:

    1. Exclude a limited amount of their foreign earned income. For TY 2020, this amount is $107,600. See IRM 3.21.3.83.3.2 for prior year amounts.

    2. Claim a housing exclusion or deduction.

  6. For TY18 and prior, a U.S. citizen or U.S. resident alien living and working in a foreign country may use Form 2555-EZ if:

    1. They have earned wages/salaries in a foreign country below the maximum allowable for the year. See IRM 3.21.3.83.3.2 for prior year amounts.

    2. They did not have any income from self-employment.

    3. They did not have any business or moving expenses for the year.

    4. They are not claiming the housing exclusion or deduction.

    5. They are filing a calendar year return that covers a 12 month period.

  7. Foreign earned income is any income earned for personal services performed in a foreign country or countries. For this purpose, a foreign country is any territory under the sovereignty of a government other than the United States.

    Note:

    It does not include U.S. territories.

  8. Unearned income may not be excluded on Form 2555 or Form 2555-EZ. To avoid double taxation, foreign taxes paid on the unearned foreign income can be:

    1. Claimed as a credit on Form 1116, or

    2. Reported as a deduction on line 6, Schedule A.

  9. U.S. citizens and resident aliens living and working outside the United States are generally required to file a U.S. income tax return to report worldwide income.

  10. To qualify for the foreign earned income exclusion under IRC 911, taxpayers must be:

    1. A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes both an entire taxable year and part of the year of the return.

    2. A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes both an entire tax year and at least part of the year of the return, or

    3. A U.S. citizen or resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months and at least part of the year falls within such period(s).

    Note:

    Due to additional taxpayer requirements, taxpayers may also reference the tax home test, or indicate that the exclusion was prorated based on the qualifying period.

  11. Wages paid by the U.S. government to its employees are not foreign earned income and an individual cannot claim the foreign earned income exclusion on those wages.

U.S. Territories - General Information

  1. The following are the five key U.S. Territories

    1. American Samoa (AS)

    2. Commonwealth of Northern Mariana Islands (CNMI)

    3. Guam (GU)

    4. Puerto Rico (PR)

    5. United States Virgin Islands (USVI)

  2. Special tax rules apply to bona fide residents of these five key territories. The taxpayer must be a United States citizen or resident alien and a bona fide resident of one of AS, CNMI, GU, PR or the USVI for the entire tax year. A bona fide resident of one of these territories is an individual taxpayer who:

    • Does not have a tax home outside the relevant territory.

    • Does not have a closer connection to the United States or to a foreign country.

    • Meets the presence test. To satisfy the presence test for the entire year, the taxpayer must meet ONE of the conditions in the table below.

    Bona Fide Residence Presence Test for United States Territories
    Present in the relevant territory for at least 183 days during the tax year.
    Present in the relevant territory for at least 549 days during the three-year period consisting of the current taxable year and the preceding two tax years, provided the taxpayer was also present in the territory for at least 60 days during each tax year of the three-year period.
    Present in the United States for no more than 90 days during the tax year.
    Earned income (pay for personal services performed, such as wages, salaries or professional fees) from the United States of no more than $3,000.00 and was present for more days in the territory than the U.S. during the tax year.
    No significant connection to the U.S. during the tax year. Significant connections include a permanent home, voter registration, or spouse/minor child in the United States.

    Note:

    It is often difficult to determine bona fide residency based on the test above. Therefore, for purpose of processing income tax returns, if the only address on the return or attachments (including Form W-2 type statements) is that of a territory, treat as an indication that the taxpayer is a bona fide resident of that territory.

  3. Taxpayers who reside in any U.S. territory are generally not entitled to claim Earned Income Credit (EIC). See IRM 3.21.3.15.1.22.

  4. U.S. Service Members / Military Personnel: A service member's "state of legal residence" generally determines their residency for tax purposes. For non-tax purposes, U.S. service members have two types of "residency" : "home of record" and "state of legal residence."

    • A service member's "home of record" is the state where they joined the military and it is used to determine certain military benefits (for example, travel allowance back to the state when leaving the military).

    • A service member's "state of legal residence" is their permanent home, the state where they intend to live after leaving the military. All service members declare their state of legal residence with the Department of Defense or equivalent.

  5. Under the Service members Civil Relief Act of 2003 (SCRA), if a service member qualifies as a bona fide resident of a U.S. Territory in an earlier tax year, their absence from that territory during the current tax year in compliance with military orders will not affect their status as a bona fide resident. Similarly, being in a territory solely in compliance with military orders will not qualify a service member for bona fide residency status in that territory.

  6. Service Members Civilian Spouses / Military Spouses: In accordance with Military Spouses Residency Relief Act of 2009 (MSRRA), civilian spouses of active duty U.S. Service Members can choose to keep their prior residence or domicile for tax purposes. Under the MSRRA, if civilian spouses qualify as bona fide residents of a U.S. territory in an earlier tax year, their absence from that territory during the current year when accompanying the service member spouse who is relocating under military orders will not affect the civilian spouse's status as a bona fide resident. Similarly, being in a territory solely to accompany the service member in compliance with military orders will not qualify the civilian spouse for bona fide resident status in that territory. For additional guidance on when and how MSRRA applies to civilian spouses who are working in or claiming tax residency in a U.S. territory, see Notice 2010-30, Notice 2011-16 and Notice 2012-41.

Control of International Returns

  1. Unnumbered returns are batched according to the type of return. The type of return determines the File Location Code (FLC) where like returns are batched together for processing under a certain program code.

  2. International Returns will be assigned the following FLCs:

    1. FLC 20 will be assigned to any Form 1040, Form 1040-SR, Form 1040A (TY17 and prior) or Form 1040EZ (TY17 and prior) with any International criteria other than U.S. territories, including Form 2555 or Form 2555-EZ (TY18 and prior) and Form 1040-NR or Form 1040-NR-EZ (TY19 and prior).

    2. FLC 21 will be assigned to any Form 1040-PR or Form 1040-SS.

    3. FLC 21 will be assigned to any Form 1040, Form 1040-SR, Form 1040A (TY17 and prior) or Form 1040EZ (TY17 and prior) with any U.S. territory criteria as follows:

    • Territory address in the caption area

    • IRC 931

    • IRC 932

    • IRC 933

    • IRC 934

    • IRC 935

    • Form W-2AS, Form W-2GU, Form W-2VI, Form W-2CM, 499R-2/W-2PR

    • Form 4563

    • Form 5074

    • Form 8689

    • Form 8898

      Exception:

      All returns that have a valid Form 2555 or Form 2555-EZ (TY18 and prior) must be blocked under FLC 20.

  3. The following table contains the programs worked in Code & Edit (C&E):

    Program Description
    46110 Form 1040 (Form 1040-SR) OTFP Current Year
    46112 Form 1040 (Form 1040-SR) Prior Year
    46114 Form 1040 (Form 1040-SR) Non Refund Current Year
    46115 Form 1040 (Form 1040-SR) - Dual Status
    46116 Form 1040 (Form 1040-SR) - RIVO Current Year
    46117 Form 1040 (Form 1040-SR) - Streamlined Filing Compliance Procedures
    46170 Form 1040 (Form 1040-SR) ITIN Current Year
    46172 Form 1040 (Form 1040-SR) ITIN Prior Year
    46175 Form 1040 (Form 1040-SR) ITIN - RIVO Current Year
    46220 Form 1040 (Form 1040-SR) Full Paid Current Year
    46132 Form 1040A Prior Year
    46152 Form 1040EZ Prior Year
    46123 Form 1040-PR/Form 1040-SS - RIVO
    46127 Form 1040-PR OTFP Current and Prior Year
    46128 Form 1040-SS OTFP Current and Prior Year
    46227 Form 1040-PR Full Paid Current Year
    46228 Form 1040-SS Full Paid Current Year
    46120 Form 1040-NR (Effectively Connected) Current Year
    46124 Form 1040-NR (Effectively Connected) Prior Year
    46140 Form 1040-NR (Non-Effectively Connected) Current Year
    46142 Form 1040-NR (Non-Effectively Connected) Prior Year
    46126 Form 1040-NR-EZ with wages on line 3
    46146 Form 1040-NR-EZ with no wages on line 3

Misblocked International Returns

  1. All documents in a block of work must be the same type of return. A misblocked return is a return found in a block with a different type of work.

  2. Rebatch returns that are blocked in the wrong FLC.

    Note:

    All returns that have a valid Form 2555 or Form 2555-EZ (TY18 and prior) must be blocked under FLC 20.

  3. If the return is unnumbered, code and edit the return and slot it into the appropriate program.

  4. If the return is numbered, edit Action Code "610" and attach Form 4227 with instructions "re-sort to FLC 20" or"re-sort to FLC 21," as appropriate.

    Note:

    Rebatch if a Domestic return has been numbered as International.

Uncomputed Returns

  1. An uncomputed return is one filed by a taxpayer who expects the IRS to compute their tax. Do not confuse an uncomputed return with a return where the taxpayer has computed no tax due.

  2. An uncomputed return can be identified when:

    1. Form 1040, Form 1040-SR, or Form 1040-NR has no entries on Lines 16, 17, 22, 24, and 37

    2. Form 1040-NR-EZ (TY19 and prior) has no entries on lines 15, 22, 23a, 24 and 25

    3. Form 1040-PR or Form 1040-SS has no entries on lines 6, 12, 13a, 14 and 15

General Instructions for All International Forms

  1. The general instructions for all International returns are provided here. The general instructions in this section include:

    • Stamping Tax Examiner (TE) numbers

    • Action Trails

    • Attachments

    • Detached Documents

  2. Use Form 1040 instructions when processing Form 1040-SR, 1040(SP), and 1040-SR(SP)

  3. Form 1040A and Form 1040EZ are historical and must be converted to Form 1040.

  4. Form 1040-NR-EZ is valid for TY19 and prior only.

  5. Form 1040, Schedules 4, 5 and 6 are valid for TY18 only.

Stamping Tax Examiner (TE) Numbers

  1. For complete instructions, see IRM 3.11.3.3.1.

Action Trails

  1. For all International returns, see IRM 3.11.3.3.5 and Job Aid 2513-701 for complete instructions.

Attachments to Returns

  1. Examine all attachments to the return. Leave the attachments with the return unless specifically instructed otherwise. Refer to the Attachment Guide in Exhibit 3.21.3-1 for specific attachment-by-attachment instructions. Research either an attachment or a notation on the return, as appropriate.

    Note:

    If an attachment is not found in Exhibit 3.21.3-1, refer to Exhibit 3.11.3-1.

  2. For additional instructions, see IRM 3.11.3.3.6.

Detached Documents

  1. Always leave an Action Trail on the return when an attachment is removed.

    Example:

    When a form or letter is detached from a return, notations such as "Det F1040X" or "Det TP correspondence" must be made on the tax return.

  2. An Action Trail must also be written on the detached document (unless it is an original document).

  3. The following must always be edited on all detached items:

    • Tax period of the return in "YYMM" format

    • Form from which detached

  4. All of the following must be present or edited on all detached items:

    • Current date if current year return processed before ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, otherwise use the received date in "MMDDYY" format

      Note:

      For ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ on a timely return with no received date, edit a date of "041521"

    • Taxpayer Name(s)

    • Primary/Secondary taxpayer’s identification number(s)

    • Taxpayer’s address

International Correspondence Procedures

  1. Correspondence is necessary when a return cannot be processed because it is incomplete or illegible. To determine all correspondence issues, you must use both IRM 3.11.3 and IRM 3.21.3 and follow line-by-line instructions.

  2. When the first correspondence condition is identified, correspond for all missing required forms, schedules and/or withholding documentation, regardless of correspondence tolerances identified in the line-by-line instructions.

    Exception:

    Only correspond for Form 1116, Form 2106, Form 8283, Form 8812/Schedule 8812, and Schedule EIC when the tolerance in line-by-line IRM instructions is met.

  3. Do Not Correspond With A Taxpayer More Than One Time.

    Exception:

    Code & Edit will correspond a second time if the taxpayer sends back a return with a signature not located in the appropriate Sign Here area under the jurat. The taxpayer's signature must appear in the space provided under the jurat, unless the taxpayer arrowed their own signature to the appropriate place.

  4. For additional instructions, see IRM 3.11.3.5.1.

Correspondence When Sending Returns Back to the Taxpayer

  1. Signature Issues: A valid signature is an original signature that appears below a jurat statement.

    Exception:

    A signature is valid if the taxpayer arrows their own signature to the appropriate place.

  2. When the first correspondence condition is identified, correspond for all missing required forms, schedules and/or withholding documentation, regardless of correspondence tolerances identified in the line-by-line instructions.

    Note:

    Only correspond for Form 1116, Form 2106, Form 8283, Form 8812/Schedule 8812 and Schedule EIC when the tolerance in line-by-line IRM instructions is met.

  3. Route secured returns with a missing or invalid signature to Collections. Do not correspond.

  4. Returns missing a valid signature(s) will be sent back to the taxpayer via the following:

    Tax Form Correspondence type
    Form 1040 Form 9143
    Form 1040-SR Form 9143
    Form 1040 (SP) Form 9143
    Form 1040-SR (SP) Form 9143
    Form 1040-NR Form 9143
    Form 1040-NR-EZ (TY19 and prior) Form 9143
    Form 1040A (TY17 and prior) Form 9143
    Form 1040EZ (TY17 and prior) Form 9143
    Form 1040-SS Form 13557 (English side)
    Form 1040-PR Form 13557 (Spanish side)

    Exception:

    Do not mail back numbered returns, disaster returns, Streamlined Filing Compliance Procedures returns or signed returns missing documentary evidence.

  5. Sending other returns back to the taxpayer: The following table provides situations when the return should be sent back to the taxpayer:

    If Correspondence Issue Is: Then:
    Misfiled returns: a business (BMF) return filed on individual (IMF) tax form See IRM 3.11.3.6.2.16
    Loose Schedule H for TY21 Correspond with Notice 1208
    Current year loose Schedule H received before the 04/15/2021 Correspond with Notice 1207
    Early filed Form 8288-A: Date of Transfer is for TY21 See IRM 3.21.3.15.1.20
    Missing or invalid signature See "Signature Issues" above
    Filer's U.S. status: Form 1040 with Form 1042-S See IRM 3.21.3.3.1 and IRM 3.21.3.15.1.20
    Filer’s U.S. status: Form 1040-NR indicating resident in the U.S. all year See IRM 3.21.3.80
    Form 1040-PR or Form 1040-SS filed with a U.S. Form W-2 income See IRM 3.21.3.78
    Bona fide Puerto Rico resident with no U.S. filing requirement See IRM 3.21.3.77.1.1
    Bona fide Puerto Rico resident claiming Additional Child Tax Credit (Form 1040 or Form 1040A (2017 and prior)) See IRM 3.21.3.77.1.1
    Article XXV of the U.S. - Canada Income Tax Treaty claimed on Form 1040 and missing Form 1040-NR See IRM 3.21.3.15

  6. When sending the return back to the taxpayer for correspondence:

    1. Line through your TE number

    2. Remove Form 3471-E and any other internal documents, if attached

      Note:

      If second correspondence is required, remove the original Form 9143 or Form 13557.

    3. Do not detach attachments.

    4. Delete any IRS Received Date.

    5. If the address is missing, illegible or incomplete, perfect from an attached envelope or from a TY18 Schedule 6. If unable to perfect, research.

    6. If an international address and domestic address are both present, circle out International address and perfect the domestic address.

    7. When sending the return back for missing or invalid signature: Edit or stamp "Returned for Signature" and edit the date in the action trail area.

    8. Stop editing the return.

    9. Complete Form 9143 or Form 13357.

    10. Attach the correspondence sheet to the return immediately below the caption area.

    11. Remove the return from the batch and place it in the designated area.

  7. When preparing Form 9143 or Form 13557:

    1. Write legibly to ensure that the taxpayer understands what information is being requested.

    2. Check the appropriate box(es).

    3. Complete all information required for each paragraph ( e.g., forms, lines, amounts, etc.)

    4. Edit money amounts in dollars and cents. Bracket negative amounts.

Correspondence When Not Sending Returns Back to the Taxpayer

  1. Complete all possible editing and identify all correspondence issues, when you are not sending the return back to the taxpayer.

  2. When the first correspondence condition is identified, correspond for all missing required forms, schedules and/or withholding documentation, regardless of correspondence tolerances identified in the line-by-line instructions.

    Exception:

    Only correspond for Form 1116, Form 2106, Form 8283, Form 8812/Schedule 8812 and Schedule EIC when the tolerance in line-by-line IRM instructions is met.

  3. If the address is missing, illegible or incomplete:

    1. Perfect from an attached envelope.

    2. If unable to perfect from an attached envelope, research.

    3. If an address can’t be found after research, see paragraph 4.

  4. When an address cannot be found through research:

    • Do not correspond.

    • Edit the local Campus address in the Caption area.

    • Follow No Reply instructions. See IRM 3.21.3.6.4.

  5. A correspondence action sheet (CAS) is a form used to generate a letter requesting information from a taxpayer. A CAS is used with a return that is not sent back to the taxpayer. The following CAS forms are used:

    1. Form 13900 is used to generate 4087C letters (International and Streamlined Filing Compliance Procedures returns). See Exhibit 3.21.3-15.

    2. Form 13975 is used to generate 2894C letter for Form 1040-SS and 2894SP letter for Form 1040-PR (International returns). See Exhibit 3.21.3-16.

    3. Form 3696-A is used to generate miscellaneous Correspondex (C) letters (e.g., Letter 369C used to deny reasonable cause).

  6. Prepare Form 13900 (Letter 4087C) or Form 13975 (Letter 2894C/Letter 2894SP) using the following steps:

    1. Write legibly.

    2. Check all appropriate boxes.

    3. Complete all information required for each paragraph selected (e.g., forms, lines, amounts, etc.)

    4. Edit money amounts in dollars and cents. Bracket negative amounts.

    5. On prior year returns only, edit the tax period in YYYY format in field (04).

  7. Prepare the CAS and attach to the tax return below the caption area.

  8. Edit Action Code "215" on all returns requiring correspondence if the return is not being mailed back to the taxpayer, unless Action Code "300" can be edited.

  9. If a received date is required and not present on the return, edit the received date before corresponding and see IRM 3.21.3.8 for received date editing instructions.

Replies to Correspondence

  1. Move all correspondence sheets to the back of the return. If second correspondence is required, remove Form 9143 or Form 13557.

  2. Ensure that the return has been perfected. See the Correspondence Action Table at IRM 3.21.3.6.5 for instructions to process "no reply," "undeliverable," and "incomplete reply" correspondence.

  3. Edit the received date on returns identified as Returned for Signature; following the instructions in IRM 3.21.3.8.1 (6).

  4. For additional "No Reply" instructions, see IRM 3.11.3.5.3.2.

No Reply/Incomplete Reply/Undeliverable Correspondence

  1. Move all correspondence sheets to the back of the return. If second correspondence is required, remove Form 9143 or Form 13557.

  2. Use the Correspondence Action Table and continue processing the return if any of the following are true:

    • Taxpayer does not provide ALL required information.

    • Correspondence is returned by the USPS as "undeliverable."

    • One or more correspondence conditions were not included when the first correspondence was sent.

  3. Edit CCC "U" on all no reply returns, except when either:

    1. The correspondence was not required, or

    2. One or more correspondence conditions were not included when the first correspondence was sent.

  4. When the correspondence sheet (Form 9143 or Form 13557) is not attached, assume all correspondence conditions were included when the correspondence was sent unless there is evidence to the contrary.

  5. If a no reply correspondence condition is not identified in IRM 3.21.3.6.5, Correspondence Action Table, edit CCC "U" and take no further action.

  6. If CCC "3" is required, edit it first.

Correspondence Action Table

  1. Form 1040:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Article XXV of the U.S. - Canada Income Tax Treaty and Form 1040-NR not attached Convert
    Bona fide resident of Puerto Rico filing Form 1040 or Form 1040A (TY17 and prior) "X" any exclusion pertaining to IRC 933 and continue processing.
    Line 25d - ≡ ≡ ≡ ≡ ≡ ≡ ≡ and Form W-2, Form 1042-S, Form 8805, Form 8288-A and/or Form 8959 are not attached "X" line 25d.

    Caution:

    If a letter is attached signed by the U.S. Competent Authority, accept the letter as proof of Form 1042-S withholding and do not "X" line 25d.

    Line 25d - Early-filed Form 8288-A and Form 843 is not attached "X" line 25d
    Line 25d - Filer’s U.S. Status and Form 1040-NR not attached Move amount on line 25d to dotted portion of line 33
    Line 25d - SSA-1042S or RRB-1042S attached and no green card and/or declaration statement attached "X" line 25d
    Line 33 (dotted portion) - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and Form 8689 is not attached "X" line 33
    Loose Schedule H - Cannot determine if Schedule H should be filed loose or attached to a Form 1040
    • Process Schedule H with a dummied Form 1040. See IRM 3.11.3.46.15 and IRM 3.21.3.48.

    • If signature or documentary evidence missing, also edit CCC "3."

    Loose Schedule H-PR - Cannot determine if Schedule H-PR should be filed loose or attached to a Form 1040-PR
    • Process Schedule H-PR with a dummied Form 1040-PR. See IRM 3.21.3.48.

    • If signature or documentary evidence missing, also edit CCC "3."

  2. Schedule 1:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Schedule 1, Line 8 - Form 2555 or Form 2555-EZ (TY18 and prior) is not attached and one or more of these indications are present:
    • IRC 911

    • Notation of Form 2555 or Form 2555-EZ (TY18 and prior)

    • Foreign Earned Income Exclusion ( Schedule 1, line 8)

    • Foreign Housing Exclusion (Schedule 1, line 8)

    • Foreign Housing Deduction (Schedule 1, line 22 dotted portion)

    1. "X" Schedule 1, line 8 and line 22 (dotted portion) and

    2. Edit CCC "U"

    Note:

    If there is no other foreign aspect of the return, rebatch the coded return as domestic.

    Schedule 1, Line 8 - Incomplete Treaty information "X" Schedule 1, line 8 and ensure amount is present on line 1, Form 1040.
    Schedule 1, Line 8 - IRC 893 and the number of the Executive Order and Written evidence not attached "X" Schedule 1, line 8
    Schedule 1, Line 8 - Sec. "965" noted and "IRC 965 Transition Tax Statement" is not attached
    • Edit RPC "F"

    • TY17 only: also edit Action Code "300"

  3. Form 2555 and Form 2555-EZ (TY18 and prior):

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    If any of the following are missing or incomplete:
    • page 1

    • page 2

    • page 3

    1. "X" Schedule 1, line 8 and line 22 (dotted portion) and

    2. "X" Form 2555 or Form 2555-EZ (TY18 and prior), and

    3. Edit CCC "U"

    Note:

    If the deleted Form 2555 or Form 2555-EZ is the only foreign aspect of the return, rebatch the coded return as domestic.

    Bona Fide Residence or Physical Presence Dates are missing
    1. "X" Schedule 1, line 8 and line 22 (dotted portion)

    2. "X" Form 2555 or Form 2555-EZ (TY18 and prior), and

    3. Edit CCC "U"

      Note:

      If the deleted Form 2555 or Form 2555-EZ is the only foreign aspect of the return, rebatch the coded return as domestic.

    Taxpayer enters beginning and ending dates that do not include part of the tax year of the return.
    1. "X" Schedule 1, line 8 and line 22 (dotted portion)

    2. "X" Form 2555 or Form 2555-EZ (TY18 and prior), and

    3. Edit CCC "U"

      Note:

      If the deleted Form 2555 or Form 2555-EZ (TY18 and prior) is the only foreign aspect of the return, rebatch the coded return as domestic.

    Joint return with an indication each spouse has their own income and only one Form 2555 or Form 2555-EZ (TY18 and prior) is attached
    1. "X" Schedule 1, line 8 and line 22 (dotted portion)

    2. "X" Form 2555 or Form 2555-EZ (TY18 and prior), and

    3. edit CCC "U"

      Note:

      If the deleted Form 2555 or Form 2555-EZ (TY18 and prior) is the only foreign aspect of the return, rebatch the coded return as domestic.

      Exception:

      If the joint filers are a missionary team, divide the income equally between the two filers on separate Form 2555 and/or Form 2555-EZ (TY18 and prior).

  4. Form 2555-EZ Only (TY18 and prior):

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Form 2555-EZ (TY18 and prior) is attached and any of the following is claimed:
    • Foreign earned income is more than the maximum allowed for the tax year

    • Self-employment income

    • Business/moving expenses

    • Foreign housing exclusion or deduction

    • Other than a calendar year return that covers a 12 month period

    1. "X" Schedule 1, line 21 and line 36 (dotted portion)

    2. "X" Form 2555-EZ (TY18 and prior), and

    3. edit CCC "U"

      Note:

      If the deleted Form 2555 and/or Form 2555-EZ (TY18 and prior) is the only foreign aspect of the return, rebatch the coded return as domestic.

  5. Form 4563 or IRC 931:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Form 1040 indicates IRC 931 or Income from American Samoa and Form 4563 is not attached
    1. "X" Schedule 1, line 8 and line 22 (dotted portion) and

    2. Edit CCC "U"

  6. Form 1040-PR and Form 1040-SS:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Form W-2 attached and Form 1040 not filed Convert
    Line 3, Part I has an amount and Part V is missing
    1. Divide Self-Employment Tax amount by .153 to determine the subtotal amount.

    2. Divide the subtotal amount by .9235 to determine the total self-employment income amount.

    3. Prepare a dummy Part V for the primary taxpayer if the Social Security Wages are $137,700 or less for TY20

      Note:

      For prior year, see IRM 3.21.3.83.3.4.1

    4. Edit the total self-employment income amount on line 3, Part V.

    Exception:

    For TY11 and TY12, divide by .133 instead of .153.

    Part I, Line 4 has an amount and Schedule H or Schedule H-PR is not attached. "X" line 4, Part I.
    All are true:
    • Line 12, Part I has a non-zero amount

    • The dotted line by Line 12, Part I has an indication of "Form 8959"

    • Form 8959 is not attached.

      Note:

      For prior year, see IRM 3.21.3.83.3.4.1

    "X" line 12, Part I.
    All are true:
    • Line 2, Part II has an amount

    • Line 3, Part II has an amount for Additional Child Tax Credit

    • Supporting documentation is missing (W-2, W-2AS, W-2CM, W-2GU, W-2VI or 499R-2/W-2PR)

    "X" line 9, Part I and page 2, Part II.
    One Part V is submitted for 2 taxpayers
    1. Divide Self-Employment Tax amount by .153 to determine the subtotal amount.

    2. Divide the subtotal amount by .9235 to determine the total self-employment income amount.

    3. Prepare a dummy Part V for the primary taxpayer if the Social Security Wages are $137,700 or less for TY20.

      Note:

      For prior year, see IRM 3.21.3.83.3.4.1

    4. Edit the total self-employment income amount on line 3, Part V.

    Exception:

    For TY11 and TY12, divide by .133 instead of .153.

  7. Form 1040-NR, Page 1:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Filed for two taxpayers: Two names present, two incomes reported, and two signatures
    1. Circle out secondary taxpayer

    2. Edit CCCs "3," "U" and "Y"

    3. Edit action trail: "no reply two taxpayers."

    Invalid treaty information provided or taxpayer does not reference a valid treaty benefit
    1. "X" the exclusion amount,

    2. ensure the amount is included in lines 1a - 9, and

    3. Edit CCC "U"

    Line 10c
    Missing a valid scholarship/fellowship grant statement and taxpayer claimed an amount.
    1. "X" line 10c and

    2. Edit CCC "U"

  8. Form 1040-NR, Page 2:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Line 25d is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and supporting Form W-2 series, Form 1099 series, Form 4852, Form 8959, or supporting documentation is not attached "X" line 25d

    Note:

    DO NOT edit CCC" U."

    Line 25e Section 1446 credit is ≡ ≡ ≡ ≡ ≡ ≡ ≡ and Form 8805 or similar withholding document is not attached "X" line 25e

    Note:

    DO NOT edit CCC "U."

    Line 25f Entry is present and Form 8288-A is not attached "X" line 25f

    Note:

    DO NOT edit CCC "U."

    Line 25f - Early-filed Form 8288-A and Form 843 is not attached "X" line 25f

    Note:

    DO NOT edit CCC "U."

    Line 25g shows an entry and Form 1042-S, Form SSA-1042S or Form RRB-1042S is not attached "X" line 25g

    Note:

    DO NOT edit CCC "U."

    Caution:

    If a letter is attached signed by the Competent Authority, accept the letter as proof of Form 1042-S withholding and do not "X" line 25g.

  9. Form 1040-NR, Schedule A (Sequence 7A - Itemized Deductions):

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Line 3 -
    • Amount present more than $500 and Form 8283 is not attached

    • $20,000 or more, Art indicated on Form 8283 and separate appraisal not attached

    • $500,000 or more and separate appraisal not attached

    • Form 8283, page 2, has significant entries but not signed

    "X" Line 3
    Line 6 Entry is present and Form 4684 is not attached
    1. "X" line 6 and

    2. edit CCC "U"

  10. Form 1040-NR, Schedule NEC (Sequence 7B - Tax on Income Not Effectively Connected With A U.S. Trade or Business)

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Cannot determine correct country of permanent address Multiply the gross not effectively connected income by 30% and edit the result to line 23a, page 2, Form 1040-NR.

  11. Form 1040-NR-EZ (TY19 and prior):

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Filed for two taxpayers: Two names present, two incomes reported and two signatures
    1. Circle out secondary taxpayer

    2. Edit CCCs "3," "U" and "Y"

    3. Edit action trail: "no reply two taxpayers."

    Invalid treaty information provided or taxpayer does not reference a valid treaty benefit
    1. "X" the exclusion amount,

    2. ensure the amount is included in lines 3 - 10 and

    3. edit CCC "U"

    Line 8
    Missing a valid scholarship/fellowship grant statement and taxpayer claimed an amount
    1. "X" line 8 and

    2. Edit CCC "U"

    Line 18a is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and supporting W-2 series or supporting documentation is not attached. "X" line 18a

    Note:

    DO NOT edit CCC "U."

    Line 18b has an entry and Form 1042-S or supporting documentation is not attached. "X" line 18b

    Note:

    DO NOT edit CCC "U."

    Caution:

    If a letter is attached signed by the Competent Authority, accept the letter as proof of Form 1042-S withholding and do not "X" line 18b.

  12. Dual-Status Returns:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    If a determination cannot be made about which return to process or the "Dual-Status Statement" is missing Edit CCC "U" and do one of the following:
    1. When both Form 1040 and Form 1040-NR or Form 1040-NR-EZ are present, process Form 1040-NR or Form 1040-NR-EZ as the "Dual Status Return" and use the Form 1040 as the "Dual Status Statement"

    2. When only one form is present, always process as a Form 1040-NR

      Note:

      Dummy Form 1040-NR if missing.

    Filing Status Code (FSC) is 2, both taxpayers have income
    1. Circle out the name of the secondary taxpayer.

    2. edit CCCs "3," "U" and "Y"

    3. Edit action trail: "no reply with two incomes."

    T-line amount(s) that do not have corresponding entries on Form 1040-NR-EZ Convert to Form 1040-NR

  13. Form SSA-1042S and/or Form RRB-1042S:

    Correspondence Required When the Following Conditions Exist: Action Required for Incomplete Reply or No Reply to Correspondence
    Withholding claimed and no U.S. documentation submitted
    1. "X" withholding amount and income where found

    2. Edit CCC "3," "U" and "Y" and

    3. Edit an action trail, "SSA/RRB-1042S"

  14. For additional no reply instructions, see IRM 3.11.3.5.3.2.

Editing for ALL International Returns

  1. Editing prepares returns and attachments for transcription and computer processing.

  2. In addition to the following subsections, see IRM 3.11.3.4.1 - 3.11.3.4.2.6.

Transcription Lines (T-Lines) and Transcription Compute Lines (T-Compute Lines)

  1. For complete instructions, see IRM 3.11.3.3.2.

Sequence of Transcribed Schedules and Forms

  1. In the upper right margin of each form or schedule is a preprinted number called a sequence code. The Integrated Submission and Remittance Processing (ISRP) operators transcribe forms and schedules by their sequence code. ISRP sequence codes range from 01 through 77A.

  2. Any form or schedule with a sequence number between 01 and 77A that is not transcribed must be deleted. See the table in IRM 3.21.3.7.2 (11) for a list of the sequence codes for all transcribed schedules and forms.

  3. Delete any document, form, or schedule that will not be transcribed when there is a transcribed form/schedule after it. For a large number of non-transcribed forms, "X" the top page and combine the remaining pages together with a rubber band, staple, or clip. Leave all non-transcribable forms/schedules intact after the last transcribed page.

    Note:

    Form 8938, Statement of Specified Foreign Financial Assets is transcribed in a separate program. Refer to Exhibit 3.21.3-1

    .

  4. Delete any form that shares a sequence number with a transcribed form.

    Note:

    Examples include but are not limited to the following:

    Form or Schedule Sequence Number
    Form 2106 54A (TY07 and prior)
    Form 3468 52 (TY09 and prior)
    Form 3903 62 (TY10 and prior)
    Form 4563 68 (TY18 and prior)
    Form 5884-B 65
    Form 8621 69
    Form 8801 74 (TY19 and prior)
    Form 8829 66 (TY09 and prior)
    Form 8862 43A
    Form 8949 12A (TY18 and prior)
    Schedule D-1 12A (TY10 and prior)
    Schedule OI 07C

  5. "X" a transcribed schedule or form if it is blank or has no significant T-line entries, unless specifically instructed otherwise.

    Exception:

    Do not "X" Form 8938 when there are no significant entries on T-Lines.

  6. If any schedule or form is attached with "Alt Min Tax" , "AMTCR" , "AMT" or "Alternative Minimum Tax" or similar statement notated across the top, "X" the form or schedule.

  7. Delete duplicate forms or schedules with identical amounts that are filed for the same taxpayer.

  8. For transcribed forms or schedules with multiple pages, rearrange the pages so they are together and in the proper order (page 1, page 2, etc.)

  9. Arrange Schedules 1 through 3 in sequential order behind Form 1040 or Form 1040-NR. When processing Form 1040-NR, keep Schedule A and Schedule NEC together as page 1 and page 2 of Sequence 07.

  10. Leave Form W-2, Form 1099, other U.S. withholding documents, Form 1040-V, taxpayer statements, deposit slips, small forms, or other items where they were found, if they do not obstruct T-lines or any part of the caption area.

  11. List of sequence codes for all transcribed schedules and forms:

    Note:

    If the return is converted, refer to the form type of the converted return.

    Forms/Schedules Sequence Code 1040 1040-NR 1040-NR-EZ (TY19 and prior) 1040-PR/1040-SS
    Schedule 1 01 Yes Yes No No
    Schedule 2 02 Yes Yes No No
    Schedule 3 03 Yes Yes No No
    Schedule A
    (Form 1040)
    07 Yes No No No
    Schedule A, Form 1040-NR 07A No Yes No No
    Schedule NEC 07B No Yes No No
    Schedule B 08 Yes No No No
    Schedule C or Schedule C-EZ (TY18 and prior) 09, 10, 11 Yes Yes No No
    Schedule D 12 Yes Yes No No
    Form 8949 (TY19 and later) 12A Yes Yes No No
    Schedule E 13 Yes Yes No No
    Schedule F 14, 15 Yes Yes No No
    Schedule R 16 Yes No No No
    Schedule SE 17, 18 Yes Yes (only Sequence Code 17) No Yes
    Form 1116 19 Yes Yes No No
    Schedule J 20 Yes Yes No No
    Form 2441 21 Yes Yes No No
    Form 3800 22 Yes Yes No No
    Form 4136 23 Yes Yes No No
    Form 4137 24, 25 Yes Yes (only sequence code 24) Yes (only sequence code 24) No
    Form 4684 26 Yes Yes No No
    Form 4797 27 Yes Yes No No
    Form 4972 28 Yes Yes No No
    Form 5329 29, 30 Yes Yes (only sequence code 29) No No
    Form 6198 31 Yes Yes No No
    Form 6251 32 Yes Yes No No
    Form 8615 33 Yes Yes No No
    Form 2555 and Form 2555-EZ (TY18 and prior) 34, 35 Yes No No No
    Form 4835 37 Yes Yes No No
    Form 8839 38 Yes Yes No No
    Form 8853 39 Yes Yes No No
    Form 8814 40, 41, 42 Yes Yes No No
    Schedule EIC 43 Yes No No No
    Schedule H and Schedule H-PR 44, 45 Yes Yes (only Sequence Code 44) No Yes
    Schedule 8812 (TY11 and prior it was Form 8812) 47 Yes Yes No No
    Form 8606 48, 49 Yes Yes No No
    Form 8863 50 Yes No No No
    Form 4952 51 Yes Yes No No
    Form 8889 52, 53 Yes Yes (only sequence code 52) No No
    Form 8880 54 Yes Yes No No
    Form 8995 (TY19 and later) 55 Yes Yes No No
    Form 8995-A (TY19 and later) 55A Yes Yes No No
    Form 8995-A, Schedule C 55D Yes Yes No No
    Form 8888 56 Yes Yes Yes Yes
    Form 8978 (TY19 and later) 57 Yes No No No
    Form 5405 58, 59 Yes No No No
    Form 8917 60 Yes Yes No No
    Form 8919 61, 62 Yes Yes (only sequence code 61) Yes (only sequence code 61) Yes
    Form 8958 63 Yes Yes Yes No
    Form 8941 65, 66 Yes Yes (only sequence code 65) No No
    Form 6252 (TY19 and later) 67 Yes Yes No No
    Form 8910 68 Yes Yes No No
    Form 8936 69 Yes Yes No No
    Form 8867 70 Yes Yes No Yes
    Form 8959 71 Yes Yes No Yes
    Form 8960 72 Yes Yes No No
    Form 8962 73, 74 Yes Yes No No
    Form 8965 (TY18 and prior) 75 Yes No No No
    Form 965-A (TY19 and later) 76 Yes No No No
    Schedule LEP 77A Yes Yes No Yes
    Form 8938 175 Yes Yes No No

Form 3471-E

  1. Edit money amounts on Form 3471-E in dollars only for all form types.

  2. Staple Form 3471-E to the last page of the tax return with Form 3471-E facing out.

Dollars and Cents Editing

  1. Allow the taxpayers to round or truncate (drop the cents) amounts.

  2. Use only dollar amounts when computing amounts on forms or schedules.

    Exception:

    Use dollars and cents when computing withholding and excess Social Security tax.

  3. For Prior Year only, draw a vertical line between the dollars and cents figures when dollars or cents are in the wrong column:

    1. on each line that is to be transcribed, or

    2. down the entire front of the form or schedule

    Exception:

    It is not required to draw a vertical line when column(s) are not present and the dollars and cents have been separated by a decimal.

  4. Dollars and cents editing is required on certain T-lines if any of the following conditions exist:

    1. A substitute form is used with dollars and cents not clearly separated by a decimal point or slash.

      Exception:

      Do not draw a vertical line to separate dollars and cents when only dollar amounts are present on a dollars and cents T-line.

    2. An entry is illegible.

    3. When computing and editing an entry as directed by line-by-line instructions.

      Exception:

      Do not edit "00" to indicate no cents.

  5. The following line numbers require dollars and cents editing when adjusting or editing:

    1. Form 1040 - lines 16 through 38 and Schedule 3, lines 8-12 and 12a

    2. Form 1040-PR - Part I, lines 6 through 15

    3. Form 1040-SS - Part I, line 6 through 15

    4. Form 1040-NR - lines 16 through 38 and Schedule 3, lines 8-12 and 12a

    5. Form 1040-NR-EZ - lines 17 through 26

Action Codes

  1. An Action Code is a three-digit numeric character used to reject a document and identify the reason for rejection.

  2. Edit Action Codes to the center of the bottom margin of page 1 of the tax return.

  3. Assign only one Action Code to a document. Edit Action Codes in the following priority:

    1. "300"

    2. "310"

    3. "4XX"

    4. "6XX"

    5. "2XX"

    6. "3XX"

  4. These action codes are for international processing only:

    1. "215" - International Correspondence

    2. "420" - Verification of Form 8288-A withholding for numbered returns

    3. "651" - Transship International returns to AUSPC

      Note:

      When processing returns that were transshipped, delete the Action Code "651" and continue processing.

  5. For a complete list of Action Codes, see Exhibit 3.11.3-2.

International Audit Codes

  1. Audit Codes are alpha or numeric characters used to identify questionable conditions for Examination.

  2. Audit Codes are edited horizontally in the right bottom margin of page 1 of the tax return.

  3. The most commonly used International Audit Codes are:

    Code Explanation
    H
    • Schedule B, line 8, Yes box is marked, or

    • One or more of the following are attached: Form 926, Form 3520, Form 3520-A, Form 5471, or Form 5472

    K Expatriation Return (Form 1040-NR with Form 8854 attached)
    L
    1. IRC 6501(d): request for prompt audit or assessment

    2. Form 5074, Allocation of Individual Income Tax to Guam or the Commonwealth of the Northern Mariana Islands is attached to Form 1040

  4. For a list of additional Audit Codes, see Exhibit 3.11.3-3.

International Return Processing Codes (RPCs)

  1. Return Processing Codes (RPC) are alpha or numeric characters used to alert the computer to a special condition or computation.

  2. RPCs are edited:

    1. Form 1040: horizontally in the bottom left margin page 1

    2. Form 1040-NR: horizontally in the bottom left margin page 1

    3. Form 1040-NR-EZ (TY19 and prior): Vertically to the right of Line 22

    4. Form 1040-SS: Vertically to the right of Line 5

    5. Form 1040-PR: Vertically to the right of Line 5

  3. For a complete list of Return Processing Codes (RPCs), see Exhibit 3.21.3-3 and Exhibit 3.11.3-5.

Special Processing Codes (SPC)

  1. Special Processing Codes (SPC) are alpha or numeric characters used to flag a condition or trigger a computation. These codes are used for computer processing and do not post to the Master File. These codes supplement the Return Processing Codes.

  2. Special Processing Codes are edited vertically in the following locations:

    • Form 1040: the right margin next to the spouse’s Social Security number.

    • Form 1040-NR and Form 1040-NR-EZ:- the right margin between the Identifying Number and the Individual/Estate or Trust check boxes.

    • Form 1040-PR and Form 1040-SS: the right margin of the Spouse's Social Security Number.

  3. For TY16 and later, edit SPC "D" if there is a federally declared disaster loss claimed on Schedule A and Form 4684.

  4. Edit SPC "P" on all Streamlined Filing Compliance returns. Special Processing Code "P" is unique to International processing.

  5. For a list of additional Special Processing Codes (SPCs), see Exhibit 3.11.3-6.

International Computer Condition Codes (CCC)

  1. Edit Computer Condition Codes:

    1. Form 1040: in the blank space to the right of the "Spouse itemizes on a separate return or you were a dual-status alien" check box

    2. Form 1040-PR and Form 1040-SS: to the right of Part I

    3. Form 1040-NR: In the center of the blank space above the “Dependents” section

    4. Form 1040-NR-EZ: to the right of the filing status, under the "Foreign Province/State/County"

  2. Edit Computer Condition Code "C" when Form 8833 (Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b)) is attached to Form 1040-NR or Form 1040-NR-EZ (TY19 and prior). CCC "C" is unique to International processing.

  3. When CCC "3" is edited, it must appear first.

  4. Always edit an Action Trail when CCC "Y" is edited.

    Exception:

    An Action trail is not required when CCC "Y" is edited to indicate that a return is Dual Status.

  5. For a list of additional Computer Condition Codes (CCCs), see Exhibit 3.11.3-4.

Received Dates for ALL International Returns

  1. The received date is the date a return was received by the IRS.

  2. When a received date is required edit it in "MMDDYY" (Month/Month, Day/Day, Year/Year) format using the instructions below:

    1. Form 1040: edit in the empty space to the right of "Dependents (see instructions)"

    2. Form 1040A (TY17 and prior): edit to the left of line 6d

    3. Form 1040EZ (TY17 and prior): edit in the center to the left of line 6

    4. Form 1040-PR: edit to the left dotted portion of line 5

    5. Form 1040-SS: edit to the left dotted portion of line 5

    6. Form 1040-NR: edit to the left of line 8.

    7. Form 1040-NR-EZ (TY19 and prior): edit to the dotted portion of line 7

  3. If the received date is present in or above the caption area, delete and edit the same received date as instructed above.

  4. If no received date is present on page 1 of the return, search the return and attachments for a received date and edit that date as instructed above.

  5. A received date is always required when the return is:

    1. Amended

    2. Delinquent (≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡)

    3. For a fiscal year, prior year, or short year

    4. Early-filed for a decedent (filed before the close of the current year)

    5. Processed June 4, 2020 or later, or the Julian date in the DLN is 155 or later

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ Do not edit a received date if the return is determined to be timely.

    Note:

    A received date is not required for Current Year Programs 46140, 46145, 46146, or 46147 until after June 3, or until the Julian date in the DLN is 155 or later.

    Exception:

    Returns batched in Program 46220, 46227, or 46228 do not require a received date.

  6. Circle a received date when it is present on a return and it is not required.

  7. Circle all but the earliest received date when a return has multiple received dates and one is required.

    Exception:

    For transshipped returns see IRM 3.21.3.8 (12).

    Note:

    Circle all but the earliest valid received dates (including Statute or other valid IRS organization's received dates) when there are multiple received dates present and a received date is required. See IRM 3.21.3.8.1.1. Taxpayer Advocate Service (TAS) received dates are not valid received dates. If multiple received dates are identical, circle all but one received date.

    Exception:

    When the return has been mailed back for missing signature(s), and multiple received dates are present, see IRM 3.21.3.8.1.

  8. If a received date is "X" -ed, circle that received date stamp.

  9. Perfect the received date when it is required and it is not legible or is incomplete. When perfecting edit in the "MMDDYY" format.

  10. When multiple returns are mailed together, the envelope is attached to one return and a dual date stamp is used on the other returns. A dual date stamp has both the postmark date and the received date.

  11. Transshipped Returns - Any of the following are indications of a transshipped return:

    1. An SPC received date stamp other than Austin (AUSPC)

    2. A yellow Optional Form 41, Routing and Transmittal Slip

    3. A blue tag titled ROUTE with the box marked AUSPC (Austin)

    4. Any other indications or evidence of a transshipped return which may be identified

  12. If a received date is required and the return was transshipped from any other Submission Processing Campus (Andover, Atlanta, Brookhaven, Cincinnati {Covington}, Fresno, Kansas City, Memphis, Ogden, or Philadelphia), follow the instructions below:

    Note:

    DO NOT refer to any other instructions in this IRM or in IRM 3.11.3 to determine the received date for any return that can be identified as being transshipped from another Submission Processing Campus.

    If Then
    The return has been stamped with an AUSPC received date and another Submission Processing Campus stamped received date. Circle out the other Submission Processing Campus received date, (including those that have ramped down) leaving only the AUSPC date.
    The return has a Field Assistance/TAC received date stamp Honor the Field Assistance/TAC received date. Circle any other received date(s).
    The return has only received date(s) stamped from another Submission Processing Campus
    1. Circle the received date(s).

    2. Edit a received date (current date minus 10 days).

      Exception:

      If today's date minus 10 days makes the received date earlier than any of the other campus dates, edit the other campus date as the received date.

    The return has only an AUSPC received date Take no action
    The return has no received date Edit a received date (current date minus 10 days)

    Exception:

    If the return was transshipped and a determination was made that the return was not foreign or the foreign aspect was deleted, process the return as a domestic return and honor the original received date.

Determining Received Date

  1. Determine the received date in the following priority when it is required and there is no valid date stamp or written received date:

    1. Latest postmark on the envelope or latest date from a designated private delivery service or private metered postmark.

      Note:

      When the envelope or air-bill is not attached, use the postmark date stamped or handwritten on the return to determine the received date.

    2. Service Center Automated Mail Processing System (SCAMPS) digital dates stamped on the envelope.

    3. Latest date by the taxpayer's signature.

      Exception:

      Use the signature date on prior year returns only when it is within the current year. Also, do not use the signature date to determine the received date for replies to correspondence.

    4. Julian date in the DLN minus 10 days

    5. Today's date minus 10 days

  2. For current year returns due April 15: Determine the received date, then:

    If the determined date is And the return is being processed Then
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ June 3 or earlier Do not edit a received date.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ June 4 or later Edit "041521" as the received date.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ April 23 or later Edit the determined date as the received date.

  3. For current year returns due June 15: Determine the received date, then:

    If the determined date is And the return is being processed Then
    June 3, 2021 or earlier June 3 or earlier Do not edit a received date.
    June 14, 2021 or earlier Between June 4 and June 14 Edit the determined date as the received date.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ June 15 or later Edit "061521" as the received date.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ June 23 or later Edit the determined date as the received date.

  4. For all prior year returns: Edit the determined date as the received date.

  5. If the stamped received date is three months or more prior to the current date, search the return for an indication the received date is incorrect (such as a postmark or signature date after the received date). If the received date is determined to be incorrect, delete it and edit a new received date following instructions in IRM 3.21.3.8.1 (1).

  6. ALWAYS review each return for the words, "Returned for Signature" or similar statement and a date present in the lower left corner of the return. These are returns that were originally received missing a signature and were mailed back to the taxpayer. If a date and the notation "Returned for Signature" or similar statement is present, refer to the following instructions for editing the received date:

    1. If the return is Balance Due and a received date is present showing a date within 30 days after the date present in the lower left corner, use the date sent back for signature as the received date. Delete any other received date(s) that may be present.

    2. If the return is Balance Due and a received date is present showing a date MORE than 30 days after the date present in the lower left corner, honor the latest received date. Delete any earlier received date(s) that may be present.

    3. If the return is a Refund, Credit Elect or Zero-balance return, honor the latest received date. Delete any earlier received date(s) that may be present.

    Exception:

    For statute returns only, if a received date is present showing a date within 30 days of the Returned for Signature date, circle out the latest received date and edit the earlier received date.

    Reminder:

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

    Caution:

    Take the following action on any International Form 1040, Form 1040-NR, Form 1040-NR-EZ, Form 1040-PR, or Form 1040-SS transshipped from another Campus, Territory Office or Foreign Post:

    If Then
    There is no Austin Submission Processing Center (AUSPC) received date Edit the received date using today's date minus 10 days

Types of Received Dates
  1. A valid Received Date stamp has all of the following:

    1. The word "Received"

    2. Month (alpha or numeric), Day, and Year

    3. The name of the city or the name of the functional area (e.g., Statute, RIVO, CSCO, Exam, ICT, CIS, AM, etc.).

    Note:

    A received date from one of these cities is not valid: Andover, Atlanta, Brookhaven, Cincinnati {Covington}, Fresno, Kansas City, Ogden, or Philadelphia. Follow the instructions in IRM 3.21.3.8 (12) for transshipped returns.

  2. Accept a valid Received Date stamp from the following:

    1. Austin (AUSC/AUSPC)

    2. Charlotte, NC

    3. Field Assistance or TAC offices

    4. IRS area/territory

    5. IRS Offices in London, Paris, Beijing or Frankfurt only.

  3. Accept as valid a handwritten or typed received date if edited by an IRS employee in Submission Processing or Return Integrity Verification Operations (RIVO).

    Note:

    A clear indication that a handwritten or typed received date has been edited by RIVO will be the presence of SPC "B" , SPC "M" and/or "RIVO" noted or stamped in the upper left margin. Generally, the RIVO edited received date will be earlier than the original, stamped received date.

  4. Accept a received date on an IRS Received Date label (Form 14471) above the caption.

    Note:

    Delete and edit the same received date as instructed in IRM 3.21.3.8 (2).

Post Office Marks
  1. For complete instructions, see IRM 3.11.3.8.2.2.

Private Delivery Service (PDS) Marks
  1. For complete instructions, see IRM 3.11.3.8.2.3.

Timely-Filed Returns

  1. For 2021, a current year return is a return filed for tax year 2020. A current calendar year return (2012) is considered timely filed when it is received on or before the due date:

    1. April 15, 2021 for Form 1040, Form 1040-PR, Form 1040-SS

      Note:

      June 15, 2021 is the due date for taxpayers residing outside the United States and Puerto Rico since they are entitled to a two-month extension to file.

    2. April 15, 2021 for Form 1040-NR (program 46120)

    3. April 15, 2021 for Dual Status Form 1040 (program 46115), Dual Status Form 1040-NR (program 46129)

    4. June 15, 2021 for Form 1040-NR (program 46140)

    5. June 15, 2021 for Dual Status Form 1040 (program 46145)

    Note:

    Dual Status Form 1040-NR-EZ (programs 46125, 46126, 46146) is not valid for TY20.

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

  3. For current calendar-year (2012) returns due April 15th, with the exception of Program 46220, 46227 or 46228, received on or before April 15, 2021:

    The document is Then
    Processed ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Circle the received date when present.

    Exception:

    NEVER circle a received date that has been edited or altered in green ink.

    Numbered with a Julian date of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ in the DLN, Circle the received date when present.

    Exception:

    NEVER circle a received date that has been edited or altered in green ink.

    Unnumbered and being processed on ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ or later Edit "041521" as the received date, if one is not present.
    Numbered with a ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ in the DLN, Edit "041521" as the received date if one is not present.

  4. For current calendar-year returns that qualify for an automatic two-month extension received on or before June 15, 2021:

    The document is Then
    Processed before ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Circle the received date when present.

    Exception:

    NEVER circle a received date that has been edited or altered in green ink.

    Numbered with a ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, Circle the received date when present.

    Exception:

    NEVER circle a received date that has been edited or altered in green ink.

    Unnumbered and being processed on ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Determine the received date if one is not present.
    Numbered with a ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ in the DLN Determine the received date if one is not present.

Grace Period

  1. By law, a timely-mailed return is a timely-filed return. This applies to both United States Postal Service (USPS) and designated Private Delivery Service (PDS) mail.

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

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

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

  5. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Then
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Exception:

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

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

    Exception:

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

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

  6. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

Late-Filed Return/Reasonable Cause

  1. A return is delinquent when it is filed after the due date without an approved extension.

    Note:

    Taxpayers residing outside the United States and Puerto Rico are entitled to a two-month extension to file.

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

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

    Note:

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

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

    Exception:

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

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

    Exception:

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

  3. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

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

  4. Edit CCC "N" on a return that qualifies the taxpayer for a special extension when the received date is≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and there is an indication (on the return or an attachment) of any of the following:

    1. The taxpayer lived outside the United States and Puerto Rico on the due date of the return.

    2. Caption address outside United States and Puerto Rico

    3. The taxpayer is in the military or naval service on duty outside the United States and Puerto Rico.

    4. The taxpayer has a APO/DPO/FPO address.

    5. Form 2555 dates indicate still there or continuing.

    6. Form 2555 has an ending date later than the tax year of the return (e.g., 2021, 2022, etc.).

    7. Return indicates Treasury Regulation 1.6081-5(a).

    Note:

    Do not edit CCC "N" on Form 1040-NR. These taxpayers do not qualify for the special extension

    .

    Note:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.

    Note:

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

  5. When the taxpayer's reasonable cause statement is not acceptable:

    1. Edit CCC "7"

    2. Route for correspondence. Letter 854C (Penalty Waiver or Abatement Disallowed Appeals Procedure Explained), must be issued.

  6. On a late-filed return when reasonable cause is established, take the following action:

    If Then
    Late filing Edit CCC "R" unless CCC "N" has been edited.
    Late payment or a "Section 6020(b)" notation is present, Edit CCC "M."

  7. Edit CCC "R" and delete CCC "N" on a late filed return when the taxpayer has a Form 4868 or Form 6401 attached to the return and an ITIN or IRSN is present in the primary SSN field. Both ITINs and IRSNs begin with a 9.

  8. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.

    Note:

    Returns filed by taxpayers with an extension are due October 15, 2021. Extension forms are not required to be attached to the return when filed.

    Reminder:

    Do not change the received date when the return was received between October 16, 2021 and October 22, 2021.

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

    Note:

    International taxpayers may have an additional extension until December 15, 2020. Extension forms are not required to be attached to the return when filed.

    Reminder:

    Do not change the received date when the return was received between December 16, 2020 and December 22, 2020.

General Instructions for ALL International Returns

  1. Edit RPC "L" and CCC "B" if there are no significant T-line entries present or edited from attachments on lines:

    • Form 1040: 1 through 38

    • Form 1040A (TY17 and prior): 7 through 51

    • Form 1040EZ (TY17 and prior): 1 through 14

    • Form 1040-NR: 1a through 38,

    • Form 1040-NR-EZ (TY19 and prior): 3 through 26

    Reminder:

    When applicable, the Dependency Status Indicator (DSI) (TY17 and prior) is required even if RPC "L" is edited.

  2. Form 1040-SS and Form 1040-PR: Edit RPC "L" if there are no significant T-line entries present or edited from attachments on line 3 through 16.

  3. Computer-generated forms are identified by a three-alpha character software code in the bottom margin of page 1 or 2. Edit RPC "V" when the tax form is computer generated, unless:

    1. The return is a Form 1040-SS, Form 1040-PR, Form 1040-NR or Form 1040-NR-EZ, or

    2. There is an indication the return was prepared by Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) (e.g., the presence of an "S" within the P-TIN field).

  4. On TY19 returns, edit CCC "B" when:

    1. The phrase "Economic Impact Payment," "EIP 2020," "Stimulus," or similar statement is noted on the return, or

    2. A single dollar for taxable interest, total income, and adjusted gross income are the only entries on the return.

  5. If the return contains page 1 from Form 1040 and page 2 from Form 1040-NR or vice-versa

    • Convert and process as Form 1040-NR unless Schedule OI is attached and the taxpayer indicates presence in the U.S. for 365 or 366 days.

    • If the taxpayer indicates presence in the U.S. for 365 or 366 days, then convert and process return as Form 1040.

  6. All amounts are to be reported in U.S. currency only. If amounts are reported in foreign currency, give the return to the workleader, who will convert any amounts reported in foreign currency to U.S. dollars using the exchange rate table appropriate for the tax period of the filer's return. See https://www.fiscal.treasury.gov/reports-statements/treasury-reporting-rates-exchange/historical.html and use December rates for the tax year of the return. Divide the foreign currency amount by the exchange rate.

  7. For early-filed returns, such as gambling:

    1. Edit Action Code "480"

    2. Edit the tax period in YYMM format

    3. Edit the received date if not present.

  8. Some situations will require special editing procedures. Examine the return for indications of these conditions. Edit these returns using instructions in IRM 3.11.3.6, Special Situations and Returns, unless otherwise instructed in line-by-line instructions in IRM 3.21.3:

    Special Situations IRM Reference
    Combat Zone and other Military Operations IRM 3.11.3.6.1.1
    Examination Cases IRM 3.11.3.6.1.5
    Fiduciary Relationship (Minor Child, POA) IRM 3.11.3.11
    Frivolous Filer/Non-Filer Returns

    Note:

    Any return with a 1099-OID should be treated as frivolous.

    Note:

    There are also FRIV 1040-NR Sole Proprietor - UK returns

    IRM 3.11.3.6.1.6
    Hardship
    When the Taxpayer Advocate Service (TAS) Liaison walks a hardship return through Code & Edit:
    • Perform all normal editing.

    • Edit CCC "O" to freeze the refund

    • Edit CCC "Y" to send the return to Error Resolution System (ERS)

    • "X" the refund line on the return.

    • Do not correspond. If correspondence conditions are identified during editing, give the return back to TAS.

    IRM 3.11.3.6.1.4
    Identity Theft: Taxpayer submits Form 14039, Form 14039 (SP) or police report(s) claiming identity theft Exhibit 3.21.3-1
    Killed in Terrorist Action (KITA) IRM 3.11.3.6.1.2
    Natural Disaster/Emergency Relief Program IRM 3.11.3.6.1.3

    Exception:

    The exception applies to domestic withholding only. Follow normal IRM procedures for withholding from Form 8805, Form 8288-A and Form 1042-S.

    Refund Schemes IRM 3.11.3.6.1.7
    Suicide Threats IRM 3.11.3.6.1.9
    Special Returns IRM Reference
    Amended IRM 3.11.3.6.2.1
    Blank Returns IRM 3.11.3.6.2.3
    Blind Trust Returns IRM 3.11.3.6.2.22
    Blocked or Deferrable Income IRM 3.11.3.6.2.6
    Correspondence Imaging System (CIS) Returns IRM 3.11.3.6.2.7
    Combined Tax Liabilities IRM 3.11.3.6.2.8
    Community Property/Registered Domestic Partnership Returns IRM 3.11.3.6.2.9 and IRM 3.21.3.9.2
    52-53 Week Return IRM 3.11.3.6.2.21
    Form 8938 Exhibit 3.21.3-1 and IRM 3.21.3.82.3.2.5
    Incomplete Returns IRM 3.11.3.6.2.4
    Injured Spouse Returns IRM 3.11.3.6.2.11
    Innocent Spouse Relief Request IRM 3.11.3.6.2.12
    Misblocked Returns IRM 3.11.3.6.2.15 and IRM 3.21.3.4.1
    Misfiled Returns IRM 3.11.3.6.2.16
    Reinput Returns IRM 3.11.3.6.2.17
    Returns Secured by Collection IRM 3.11.3.6.2.18
    Short Period Returns IRM 3.11.3.6.2.19

    Note:

    Edit Action Code "215" on International Returns.

    Substitute for Return (SFR) IRM 3.11.3.6.2.20
    Unprocessable Return IRM 3.11.3.6.2.2

Streamlined Filing Compliance Procedures

  1. Streamlined Filing Compliance Procedures for Non-Resident, Non-Filer Taxpayers (2012 Streamlined Procedures) became effective September 1, 2012 and provided procedures for certain US citizens living abroad who were non-filers to file delinquent tax returns without being charged failure to file (FTF) or failure to pay (FTP) penalties. The 2012 Streamlined Filing Compliance Procedures is a legacy procedure no longer available to taxpayers.

  2. Effective July 1, 2014, returns submitted under the Streamlined Filing Compliance Procedures are tracked using:

    • Programs 46117 for Form 1040, 46132 for Form 1040A (TY17 and prior), and 46152 for Form 1040EZ (TY17 and prior)

    • Blocking series from 850 - 899

  3. Treat as Streamlined Filing Compliance Procedures if any are present:

    • Notation of "Streamlined Foreign Offshore"

    • Notation of "Streamlined Domestic Offshore"

    • Package of returns addressed to Mail Stop 6063 AUSPC

    • Taxpayer mentions the "Streamlined" procedures in an attached letter

  4. If a package contains a mixture of Form 1040, Form 1040A (TY17 and prior) and/or Form 1040EZ (TY17 and prior), convert to Form 1040. If a package contains a mixture of Form 1040-NR and Form 1040-NR-EZ (TY19 and prior), convert to Form 1040-NR.

  5. Returns postmarked on or after July 1, 2014 will follow the Streamlined Filing Compliance Procedures processing instructions as outlined at IRM 3.21.3.9.1.1.

  6. Submissions consisting only of Form 1040-NR are not processed using Streamlined Filing Compliance Procedures. Forms 1040-NR must have been reviewed by LB&I per IRM 3.21.3.9.1.1 LB&I will indicate this by leaving an action trail in the left margin.

  7. Streamlined packages may contain a mixture of Form 1040, Form 1040-NR, and Dual Status returns.

    • Fully code all returns.

    • Tag Forms 1040-NR for rebatch with a purple rebatch tag. Mark the Streamlined 1040-NR box.

    • Edit action trail "Streamlined Package Complete" in the left margin on each return in the package.

    Note:

    If the Form 1040 is the controlling document in a Dual Status return, do not tag the return for rebatching.

  8. Unless otherwise instructed, it is important that all returns submitted by a taxpayer be kept together. Streamlined packages tagged for rebatching will require special handling. Forms 1040-NR will be rebatched into appropriate programs. All program transmittals and returns must stay together through the remainder of the pipeline process.

  9. If Letter 4087C and/or an explanation stating that the taxpayer is responding to a 4087C is attached, or if there is an envelope addressed to MS 6126, treat as a "reply to Streamlined correspondence." Route the uncoded package to Rejects using the yellow Streamlined tag.

    Exception:

    Do not route to Rejects if a notation "Process as Original" or "PAO" is present on the return.

  10. All returns submitted under the Streamlined Filing Compliance Procedures must have a valid Taxpayer Identification Number (TIN). If a return submitted to the Streamlined Procedures is received without a Taxpayer Identification Number (TIN), search the package for a valid TIN. If no TIN is found, route the uncoded package to Entity Control for an IRSN using yellow Streamlined tag.

    Reminder:

    An IRSN must be assigned before the package can be routed to Statute. The assignment of an IRSN to a submission made by a taxpayer required to use and SSN does not constitute waiver by the IRS of the eligibility requirements for the Streamlined Filing Compliance Procedures.

  11. Any Streamlined package that contains any return marked amended/duplicate/copy or indication of Copy to ICT submitted under this program should be routed uncoded to LB&I at MS 4305 AUSPC using yellow Streamlined tag.

    Note:

    If the Certification Form 14653 or Form 14654 is marked "Amended" then the Streamlined package must be reviewed by LB&I before processing. If an amended certification form is attached to an amended return, and there isn’t an indication of prior LB&I review, then route the package to MS AUSC - 4305 using yellow Streamlined tag.

    Note:

    LB&I will review the returns and determine the actions that need to be taken by Submission Processing. Follow the directives provided by LB&I when the return is received back from LB&I review. LB&I will make the notations in the lower left margin.

    Exception:

    If a statute year Form 1040X without an "AM Streamlined Cover sheet" attached has not been cleared by Statute, route the entire package uncoded to LB&I at MS 4305 using yellow Streamlined tag.

  12. If a return in the package requires Statute Clearance, route the entire uncoded package to Statute using yellow Streamlined tag.

    Exception:

    Statute year Forms 1040X received with an "AM Streamlined Cover sheet" already attached do not need to be routed to Statute.

  13. When the Attachment Guide requires routing the actual return to another department (e.g., Collections, Exam), route to LB&I MS 4305 by attaching the yellow Streamlined tag to the uncoded package, checking the "other" box, and writing the reason for routing to LB&I.

  14. When the Attachment Guide requires research, route to LB&I MS 4305 by attaching the yellow Streamlined tag to the uncoded package, checking the "other" box, and writing the reason for routing to LB&I.

  15. When attachments are received separated from returns (FBARs, certifications, correspondence, etc.), attach them to corresponding tax years. If the attachment does not correspond to a tax year, attach to the latest Streamlined tax year.

    Exception:

    If original BMF forms are listed on the certification, route entire package to LB&I at MS 4305. Otherwise, route BMF forms to R&C and leave action trail on related tax year (if any).

  16. Follow local procedures for completing and routing Forms 1040X with an Accounts Management cover sheet.

2014 Streamlined Filing Compliance Procedures
  1. Review all instructions in IRM 3.21.3.9.1 prior to processing with Streamlined Filing Compliance Procedures.

  2. All Streamlined returns should be coded with SPC "P" .

  3. When a complete Streamlined package is received, edit:

    • CCC "M"

    • CCC "P"

    • CCC "R"

      Note:

      Do not edit CCC "N" if editing CCC "M" , CCC "P" and CCC "R" .

      Caution:

      Do NOT edit CCC "M" , "P" and CCC "R" if corresponding for a Streamlined issue such as the certification. If CCC "M" , CCC "P" and CCC "R" are not edited, see IRM 3.21.3.8.4 for CCC "N" instructions.

  4. The instructions for editing CCC "7" on Streamlined returns will not apply if the return has CCC "M" , CCC "P" and CCC "R" edited.

  5. Follow normal coding instructions as outlined in IRM 3.21.3 and IRM 3.11.3.

  6. If the package is incomplete, see IRM 3.21.3.9.1.2.

  7. Once it has been determined that a Streamlined Package is complete:

    1. If a copy of the certification is not attached to each tax year in the package, photocopy and attach.

    2. If the taxpayer provides an explanation on a separate statement, the statement must also be copied and attached to the return.

    Note:

    Use pink tag to indicate the number of copies and which returns need copies.

  8. Once all returns have a photocopy of the certification, detach the certification with the original signature. Route this original certification to LB&I at MS 4305, using blue routing tag.

  9. If a package contains Form(s) 1040X AND the certification is complete with all tax years:

    1. A copy of the certification MUST be attached to each Form 1040X.

    2. Edit an action trail "Streamlined Package Complete" in the left margin on each return in the package.

    3. Separate the Form(s) 1040X.

    4. Place an Accounts Management cover sheet on each Form 1040X.

    5. Route to Accounts Management using blue routing tag. Keep the Form(s) 1040X together if there are multiple forms

    Exception:

    If Streamlined correspondence is required, follow IRM 3.21.3.9.1.2 (2).

Correspondence for 2014 Streamlined Filing Compliance Procedures
  1. If the items below are not submitted with a new Streamlined package, correspond.

    1. Items required for a complete Streamlined Foreign Offshore filing:
      - Original signature(s) of the taxpayer(s) under a jurat on at least one Certification.

      Note:

      If the tax return is married filing jointly then correspond if one or both signatures are missing.

      Exception:

      Any return received from LB&I with the notations of "Process as Streamlined" and "Reviewed by LB&I" and there is a copy of the original certification, do not correspond for original certification.


      - Form 14653 (Certification by U.S. Person Residing Outside of the United States for Streamlined Foreign Offshore Procedures).

    2. Items required for a complete Streamlined Domestic Offshore filing:
      - Amount of taxpayer's miscellaneous offshore penalty (only packages with Form 1040X require a penalty computation).
      - An original signature is required under a jurat on at least one certification.

      Note:

      If the tax return is married filing jointly then correspond if one or both signatures are missing.

      Exception:

      Any return received from LB&I with the notations of "Process as Streamlined" and "Reviewed by LB&I" and there is a copy of the original certification, do not correspond for original certification.


      - Form 14654 (Certification by U.S. Person Residing in the United States for Streamlined Domestic Offshore Procedures).

      Note:

      If the taxpayer submits Streamlined package with Form 14438 questionnaire instead of a certification, correspond using paragraph "E" instructing the taxpayer to follow current Streamlined procedures.

    Note:

    A substitute certification form is acceptable as long as it contains all of the relevant information listed above including a signature under a jurat. Correspond if missing.

  2. If any Streamlined correspondence is required, follow the instructions below:

    • Use Form 13900 and only correspond on one tax year.

    • Use Action Code "215" on each return, except Form 1040X.

    • Keep the package together - including any Form(s) 1040X.

    • Place an Accounts Management cover sheet on each Form 1040X.

      Reminder:

      Keep the package together.

  3. If correspondence is required AND there are NO Streamlined issues, follow the instructions below:

    • Use Form 13900 to correspond.

    • Use Action Code "215" on each return, except Form 1040X.

    • Keep the package together with the exception of Form(s) 1040X,

    • Ensure each return has a copy of the certification and route the original certification to LB&I at MS 4305.

      Caution:

      If you are separating Form(s) 1040X, remember to use the AM cover sheet and attach a copy of the certification to the return(s). Edit an action trail "Streamlined Package Complete" on each return in the package.

Amended/Duplicate Returns Submitted for 2014 Streamlined Filing Compliance Procedures
  1. See IRM 3.21.3.9.1.1.

Community Property or Registered Domestic Partnership Returns - General Information

  1. If taxpayers are married and are subject to the community property laws of a foreign country, a United States state, or a United States Territory, they generally must follow those laws to determine their income for United States tax purposes unless:

    1. Both taxpayers are nonresident aliens.

    2. One taxpayer is a nonresident alien and the other is a United States citizen or resident and they do not both choose to be treated as United States residents.

  2. If one taxpayer is a nonresident alien, the following rules apply to community income.

    1. Earned income of a spouse, other than trade or business income and a partner’s distributive share of partnership income, is treated as the income of the taxpayer whose services produced the income. That taxpayer must report all of it on a separate tax return.

    2. Trade or business income, other than a partner distributive share of partnership income, is treated as the income of the person who exercises substantially all of the management and control over the trade or business. That taxpayer must report all of it on a separate return.

    3. Partnership income (or loss). A partner distributive share of partnership income is treated as the income (or loss) of the partner. The partner must report all of it on a separate return.

  3. Income derived from the separate property of one taxpayer (and which is not earned income, trade or business income, or partnership distributive share income) is treated as the income of that taxpayer. That taxpayer must report all of it on a separate return. Use the appropriate community property law to determine what is separate property.

    Note:

    Income can no longer be split under Community Property provisions.

  4. All other community income is treated as provided by the applicable community property laws.

Decedent Return

  1. For ALL International returns, see IRM 3.11.3.10 - 3.11.3.10.6.

  2. In addition to the instructions above, special editing is required when an Additional Information Line (AIL) is required for a foreign address. If a foreign address AIL is present, and a decedent AIL is present or has been edited as a second AIL, take the following actions for a refund return:

    1. DO NOT edit CCC "L" or CCC "W" .

    2. Edit CCC "Y" and an action trail of "Manual Refund" .

      Exception:

      Do not edit CCC "Y," if CCC "3" has been edited. If the taxpayer has elected to use Direct Deposit or has been issued an IRSN, do not edit CCC "Y" (An IRSN begins with a 9 and the middle two digits are other than 50-65, 70-88, 90-99. The middle two digits identify the campus location where it was issued.)

Tax Period for International Returns

  1. See IRM 3.21.3.81.1 for Form 1040-NR and Form 1040-NR-EZ specific instructions.

  2. Australian residents often use a June (06) fiscal tax period ending date that coincides with the Australian accounting period. Follow taxpayer intent and edit YY06 for the tax period when June 30th is indicated as the tax period ending date on the tax return for an Australian resident.

  3. New Zealand residents often use a March (03) fiscal tax period ending date that coincides with the individual New Zealand accounting period. Follow taxpayer intent and edit YY03 for the tax period when March 31st is indicated as the tax period ending date on the tax return for a New Zealand resident.

  4. U.K. residents use a fiscal tax period that ends on April 5th.

  5. For additional instructions refer to IRM 3.11.3.7.

    Caution:

    See IRM 3.21.3.81.1 for additional information Form 1040-NR or Form 1040-NR-EZ instructions.

General Instructions for Editing All International Returns

  1. The following subsections contain instructions for:

    • Caption Information

    • Taxpayer Identification Number

    • Name and Additional Information Line

    • Mailing Address

    • City and State

    • ZIP Code

    • Country Name

  2. Additional instructions may be found within form-specific instructions.

Caption Information and Editing

  1. Required Caption Information Includes:

    1. Primary Taxpayer Identification Number (P-TIN)

    2. Secondary Taxpayer Identification Number (S-TIN), if applicable

    3. Name(s)

    4. Additional Information Line (which may be present to further identify the taxpayer's location or representative)

    5. Mailing Address

    6. City/State

    7. Foreign Province/State or Territory/Foreign Mail Routing Code/Postal Code

    8. Country (if applicable)

    9. ZIP Code when available

  2. Do not change the name control when it has been edited in red by: Entity Unit, ITIN Operation, or RPS employee. Use the Entity/ITIN/RPS editing to perfect the:

    1. Name Control for the caption.

    2. TIN on attachments - Schedule C, Schedule EIC, Schedule H, Schedule SE, Form 2441, Form 4137, Form 5405, Form 8839, Form 8853, Form 8863, Form 8865, Form 8919, Form 8941, Form 8958, and Form 8965.

    Note:

    The name control for a newly assigned TIN or IRSN may have been edited and underlined by the ITIN Operation or Entity Unit.

  3. Search the return and attachments for any missing caption information and perfect the caption if all missing information is found. For TY18, edit international address information from Schedule 6 to the caption if not already present when a complete address cannot be found elsewhere on the return.

  4. For additional instructions, see IRM 3.11.3.9.1 and 3.11.3.9.2. In addition to these instructions, form specific instructions must be followed for Form 1040-NR and Form 1040-NR-EZ. See IRM 3.21.3.81.3 through IRM 3.21.3.81.5.

Taxpayer Identification Number

  1. For complete instructions see IRM 3.11.3.9.2.1.

Primary TIN
  1. If the P-TIN is missing or incomplete, examine the return and its attachments and edit the P-TIN, if found. Circle an incomplete P-TIN.

  2. If there is an indication the taxpayer has used a TIN that is not their own, take no action.

    Example:

    The taxpayer shows an ITIN on the return and an SSN on attached Form(s) W-2.

  3. If the primary taxpayer’s TIN includes a notation of “NRA” or “nonresident” and the secondary taxpayer has an SSN/ITIN and income, edit the secondary SSN/ITIN as the primary TIN and reverse the order of the names.

  4. See IRM 3.21.3.81.3.1.1 for Form 1040-NR and Form 1040-NR-EZ specific instructions.

  5. For additional instructions, see IRM 3.11.3.9.2.1.1.

Secondary TIN
  1. Edit the S-TIN from the return or attachments if it is missing or incomplete, and the Filing Status (FS) is "2," "3" or "6."

    Exception:

    A Secondary TIN is not allowed on a Form 1040-NR or Form 1040-NR-EZ.

  2. For additional instructions, see IRM 3.11.3.9.2.1.2 and IRM 3.21.3.81.4.1.

Canadian TIN
  1. Canadian TIN: Canada assigns a Canadian TIN in a 3-3-3 (000-000-000) format. If it can be determined that the TIN is a Canadian TIN, examine the return and attachments for a TIN in a 3-2-4 (000-00-0000) format:

    1. If found, circle the Canadian TIN and edit the correct U.S. TIN (000-00-0000 format).

    2. If not found, circle the Canadian TIN.

ITIN
  1. ITINs are issued to individuals who do not qualify for Social Security Numbers (SSNs). The ITIN is issued for tax purposes only and is obtained by completing a Form W-7, Application for IRS Individual Taxpayer Identification Number.

  2. Stop editing the return and take the following actions when Form W-7 or Form W-7(SP) is attached to the return:

    1. Unnumbered:
      • Pull the return from the batch. Attach Form W-7 to the front of the return.
      • Edit the Received Date to the left of the line 6 area on Form W-7/W-7(SP) in "MMDDYY" format and route the entire return to the ITIN unit.

    2. Numbered: Edit Action Code "610" .

Internal Revenue Service Number (IRSN)
  1. These numbers are used for internal processing only when the taxpayer does not qualify for an SSN or ITIN. An IRSN will start with a 9 (nine) and the middle two digits are other than 50-65, 70-88, 90-99. The middle two digits identify the Campus location where it was issued from. The fourth and fifth digits for the Austin Campus are 06, 18 and 66.

Name and Additional Information Lines

  1. Each return processed must have a legible last name. Research following local procedures when the name is illegible and cannot be perfected.

  2. There are two (2) lines available for taxpayer identification:

    1. The name line is for the first name, middle initial and last name(s) of the primary and secondary (if present) taxpayer(s). This includes any suffix.

    2. The additional information line (AIL) is used to further identify the taxpayer or contain a foreign street address.

      Example:

      Additional name, address or representative information may be shown.

Name Line
  1. For complete instructions, see IRM 3.11.3.9.2.2 and IRM 3.11.3.9.2.2.1.

Additional Information Line
  1. An AIL can contain the following information:

    1. A fiduciary, taxpayer representative, or in-care-of (c/o) information

    2. A parent signing for a minor child, see Figure 3.21.3-1.

    3. A location other than a street address (e.g., building, college, company), See IRM 3.11.3.9.2.2.2.

    4. Mailing address of a foreign country

      Note:

      A P.O. Box can be an AIL

    5. Puerto Rico address, see IRM 3.21.3.12.3.3.

  2. If any of the above items listed in IRM 3.21.3.12.3.2 (1) are present, edit and/or underline the AIL.

    Exception:

    Do not underline the foreign mailing address if no province, city or postal code is present.

  3. If a foreign address is present on Form 1040, Form 1040A, Form 1040EZ and a name is present or has been edited as a second AIL, underline both. Then take the following actions for REFUND returns:

    1. For Decedent Returns do not edit CCC "L" or CCC "W" .

    2. Edit CCC "Y" and an action trail of "Manual Refund" .

      Exception:

      Do not edit CCC "Y," if CCC "3" has been edited. If the taxpayer has elected to use Direct Deposit or has been issued an IRSN, do not edit CCC "Y" (An IRSN begins with a 9 and the middle two digits are other than 50-65, 70-88, 90-99. The middle two digits identify the Campus location where it was issued from. The fourth and fifth digits for the Austin Campus are 06, 18 and 66.)

  4. For additional instructions, refer to IRM 3.11.3.9.2.2.2.

    Figure 3.21.3-1

    This is an Image: 34010001.gif

    Please click here for the text description of the image.

Additional Information Line (Puerto Rico)
  1. The Additional Information Line (AIL) may be found anywhere in the caption area.

    Note:

    See IRM 3.21.3.12.3.3 (3)(g) below for examples of correct editing of address.

  2. Underline as the AIL urbanizations, subdivisions and buildings unless it is the only element of the mailing address. In the table below are common abbreviations used to refer to urbanizations, subdivisions and buildings.

    Abbreviations Urbanizations, Subdivisions and Buildings
    ALT Altura
    ALTS Alturas
    BDA Barriada
    BO Barrio
    CARR Carretera
    COLINAS Colinas
    COND Condominio
    COOP Cooperativa
    DEPT Departamento
    EDIF or EDF Edificio
    EST Estancias
    EXT Extension
    IND Industrial
    JARD Jardines
    MANS Mansiones
    PARC Parcelas
    PARQ Parque
    PUERTO Puerto
    QBDA Quebrada
    QTAS Quintas
    RPTO Reparto
    RES Residencial
    SECC Seccion
    SECT Sector
    TERR Terraza
    URB Urbanizacion
    VILLA Villa

  3. For Puerto Rico only, the following are different types of address formats:

    1. Four-line address containing Name, Urbanization, House Number and Street Name, City, State and ZIP Code.

    2. Three-line address containing Name, House Number and Street Name, City, State and ZIP Code.

      Exception:

      Some areas in Puerto Rico do not have street names or repetitive house numbers. The urbanization name substitutes as the street name and becomes the primary identifier.

      Example:

      Name, House Number and Urbanization Name, City, State and ZIP Code.

    3. Public Housing Projects (residenciales) without street names or repetitive apartment numbers. In these cases, the apartment number is the primary number and the public housing project becomes the street name.

      Example:

      Name, Apartment Number and Residential Name, City, State and ZIP Code.

    4. Apartment Buildings and Condominiums with a physical (street) address containing Name, Building Name, Street Number Apartment Number, City, State and ZIP Code.

    5. Buildings without a physical address. Certain Condominiums are located on an unnamed street and may not have an assigned number. The name of the Condominium substitutes as the street name and the number 1 is used when no building number exists.

    6. Urbanization - denotes an area, sector or residential development within a geographic area. Commonly used in Puerto Rico urban areas, it is an important part of the addressing format, as it describes the location of a specific street. In Puerto Rico, identical street names and address number ranges can be found within the same ZIP Code. In these cases, the urbanization name is the only element that correctly identifies the location of a particular address. Generally, the abbreviation URB is placed before the urbanization name.

    7. Below is a table of examples of correct address coding:

      Tax Return Address Correct Coding
      URB. Jardines de San Blas A-4 URB. Jardines de San Blas A-4
      Estancias De Tortuguero,
      521 Calle Tulipa
      Estancias De Tortuguero
      521 Calle Tulipa
      Bo Rocha Comunidad LaSalle HC 02 Box 12811 Bo Rocha Comunidad LaSalle
      HC 02 Box 12811
      Puerto Nuevo 512 Calle Aragon Puerto Nuevo
      512 Calle Aragon
      Urb San Rafael EST Calle Violeta E-19 Buzon 246 Urb San Rafael EST
      Calle Violeta E-19 Buzon 246
      Cond. Hato Rey Plaza Jesus T Pinero #200 Apt 6-M Cond. Hato Rey Plaza
      Jesus T Pinero #200 Apt 6-M
      URB Ciudad Jardin de Bairoa 88 Calle Franca URB Ciudad Jardin de Bairoa
      88 Calle Franca
      Villa Fortuna / Via Leticia 4LS-10 Villa Fortuna
      Via Leticia 4LS-10
      Plaza Antillana 151 Calle Caesar Gonzalez Apt 6203 Plaza Antillana
      151 Calle Caesar Gonzalez Apt 6203
      Reina de Los Angeles U-11 Calle 1 Reina de Los Angeles
      U-11 Calle 1

Mailing Address

  1. There are two types of international mailing addresses:

    1. U.S. Territory address

    2. Foreign Country address (address not within the 50 United States, District of Columbia, or any U.S. Territory)

  2. For Domestic addresses refer to IRM 3.11.3

International Mailing Address
  1. A U.S. Territory Address includes:

    1. Street Address - if the street address is missing or incomplete, underline the name control.

      Caution:

      Do not delete any reference of Urbanization or URB for Puerto Rico.

      Note:

      For Puerto Rico address AIL editing, see IRM 3.21.3.12.3.3.

      Note:

      Multiple Addresses or no Mailing Address, see IRM 3.11.3

      .

    2. City

    3. U.S. Territory - must be abbreviated with a valid two (2) character state abbreviation. Circle out the U.S. Territory and edit the abbreviation listed below. See Figure 3.21.3-2:
      • AS - American Samoa
      • GU - Guam
      • MP - Commonwealth of the Northern Mariana Islands
      • PR - Puerto Rico
      • VI - Virgin Islands

    4. ZIP Code - edit the ZIP code if missing. See Exhibit 3.21.3-6 and Figure 3.21.3-3 if unable to edit the ZIP code.

      Figure 3.21.3-2

      This is an Image: 34010002.gif

      Please click here for the text description of the image.

      Figure 3.21.3-3

      This is an Image: 34010003.gif

      Please click here for the text description of the image.

  2. Federated States of Micronesia, Marshall Islands and Palau are not territories, but they use the same addressing method as U.S. territories:

    1. Street Address

    2. City

    3. Country name abbreviated with a valid two (2) character state abbreviation. Circle out the country name and edit the abbreviation listed below:
      FM - Federated States of Micronesia
      MH - Marshall Islands
      PW - Palau

    4. ZIP Code - edit the ZIP code if missing. See Exhibit 3.21.3-6 if unable to edit the ZIP code.

  3. A Foreign Country Address includes:

    1. Street Address - underline the street address or location as the additional information line,

      Caution:

      When an address is short (no city, state, province or postal code is present), such as those from Hong Kong, the use of an AIL is not needed - Do Not Underline the AIL, but do /country/$. See Figure 3.21.3-4.

      Note:

      If a P.O. Box and street address are present, underline both as the AIL.

      Note:

      If the street address is missing or incomplete, refer to IRM 3.11.3.9.2.3.

    2. City

    3. Foreign Province/State/County and Foreign mail routing code/postal code,

    4. Foreign Country Name in a /country name/$ format, see Figure 3.21.3-5.

  4. If a domestic and foreign address are both present, circle out the foreign address.

    Note:

    If the deleted address is the only foreign aspect of the return, rebatch the coded return to a domestic program.

    Figure 3.21.3-4

    This is an Image: 34010004.gif

    Please click here for the text description of the image.

    Figure 3.21.3-5

    This is an Image: 34010005.gif

    Please click here for the text description of the image.

City
  1. Many cities share names with states/provinces or countries. Do not delete the city name.

  2. For domestic addresses, refer to IRM 3.11.3.9.2.4.

State
  1. For domestic addresses, refer to IRM 3.11.3.9.2.4.

Province/State/County of Foreign Addresses
  1. States/provinces/counties for the countries listed below must be abbreviated. Circle out the state/province/county and edit the abbreviation in its place. See Exhibit 3.21.3-5 for a list of abbreviations.

    • Australia

    • Brazil

    • Canada

    • Cuba

    • Italy

    • Mexico

    • Netherlands

    Caution:

    Many cities share names with states/provinces. Do not delete or abbreviate a city name.

    Note:

    See Figure 3.21.3-6 for coding examples.

    Figure 3.21.3-6

    This is an Image: 34010006.gif

    Please click here for the text description of the image.

ZIP Code and Foreign Postal Code (International Mail Routing)
  1. U.S. territories must have a ZIP Code; edit if missing. See Exhibit 3.21.3-6.

  2. A mail routing code/postal code for foreign addresses can contain alpha and/or numeric characters. If missing, edit the mail routing code following the state or province if it can be readily determined. See Figure 3.21.3-7

  3. For domestic addresses, see IRM 3.11.3.

    Figure 3.21.3-7

    This is an Image: 34010007.gif

    Please click here for the text description of the image.

APO/FPO/DPO Addresses

  1. APO/FPO/DPO addresses are military mail addresses. APO/FPO/DPO addresses are considered domestic addresses

  2. APO, FPO or DPO serves as the city name in the mailing address and AA, AE or AP serves as the state code.

  3. Military mail is first mailed to a central processing center in a U.S. city and then transferred to the military mail system. If the taxpayer provides the U.S. city name, circle the city edit the appropriate state code using the table below

    City State Code
    Miami, FL AA
    New York, NY AE
    San Francisco, CA AP

  4. If the taxpayer provides the name of a foreign city or country, circle the foreign city or country name and edit the appropriate state code using the table below.

    If the foreign city/country is located in Edit State Code
    Central America, South America or Caribbean AA
    Europe, Middle East, Africa or Canada AE
    Asia or the Pacific AP

  5. For additional instructions, see IRM 3.11.3.

Country Name

  1. The name of the country in a foreign address must be edited using "/Country/$."

    Caution:

    If a foreign city/country is present, along with an APO/DPO/FPO address, circle the foreign address, leaving the APO/DPO/FPO address.

  2. If a domestic and foreign address are both present, circle out the foreign address.

    Note:

    If the deleted address is the only foreign aspect of the return, rebatch the coded return as domestic.

  3. When an address is short (no city, state, province or postal code), such as those from Hong Kong, the use of an AIL is not needed - Do Not Underline the AIL, but do /country/$. See Figure 3.21.3-4.

  4. If the country is missing and it can be readily determined, edit the country. See Exhibit 3.21.3-7.

  5. The country name in a foreign address must be spelled out. See examples below and Figure 3.21.3-8:

    • UAE - circle and edit /United Arab Emirates/$

    • UK - circle and edit /United Kingdom/$

    • ROC - circle and edit /Taiwan/$

    • SAR - circle and edit /Hong Kong/$

    • PRC or PROC - circle and edit /China/$

    Exception:

    The countries listed below must be abbreviated as follows:

    Country Abbreviation
    Ashmore and Cartier Islands Ashmore and Cartier Is
    Bosnia and Herzegovina Bosnia Herzegovina
    British Indian Ocean Territory British Indian Oc Terr
    British Virgin Islands British VI
    Central African Republic Central African Rep
    French Southern and Antarctic Lands FR Southern Antarctic
    Heard Island and McDonald Islands Heard Is McDonald Is
    Macedonia, The Former Yugoslav Republic of Macedonia
    Saint Pierre and Miquelon St Pierre Miquelon
    Saint Vincent and The Grenadines St Vincent Grenadines
    Serbia and Montenegro Serbia Montenegro
    South Georgia and The South Sandwich Islands S Georgia S Sandwich
    Turks and Caicos Islands Turks and Caicos Is

    Figure 3.21.3-8

    This is an Image: 34010008.gif

    Please click here for the text description of the image.

  6. Hong Kong and China are considered separate countries for tax purposes. If the taxpayer puts "Hong Kong China" as the country in the caption area, circle out China.

  7. If the country name contains "Republic of" edit to leave the country name.

    Exception:

    If R.O.C. or Republic of China is present in the caption, circle and edit "/Taiwan/$."

  8. If any of the countries that are part of the United Kingdom (Great Britain, England, Northern Ireland, Scotland, and Wales) are present in the caption, circle and edit the country as "/United Kingdom/$."

  9. Accept Palestine, Palestinian Territories or similar as the country name when no other country is present in the caption area.

Filing Status Editing - General Information for Form 1040/Form 1040A/Form 1040EZ

  1. The filing status (FS) is used to determine the taxpayer’s standard deduction amount, eligibility for the earned income tax credit, and to compute their tax.

  2. The instructions in this manual subsection are for determining and editing the correct FS when processing Form 1040, Form 1040A, or Form 1040EZ.

    Reminder:

    Form 1040A and Form 1040EZ are valid for TY17 and prior only. See IRM 3.21.3.83.3.1 for additional processing instructions.

  3. Edit the FS by either checking the appropriate box or by editing the FS Code to the appropriate area.

  4. The meaning of the filing status codes are:

    1. FS "1" - single taxpayer

    2. FS "2" - married taxpayers filing a joint return

    3. FS "3" - married taxpayer filing a separate return (spouse exemption is not claimed)

    4. FS "4" - head of household

    5. FS "5" - qualifying widow(er)

    6. FS "6" - married taxpayer filing a separate return (spouse exemption is claimed)

    7. FS "7" - head of household (dependent exemption is not claimed)

Determining the Filing Status

  1. For complete instructions see IRM 3.11.3.12.2 through IRM 3.11.3.12.2.5.

Dependents - Exemptions for Form 1040/Form 1040A

  1. For complete instructions, see IRM 3.11.3.13.

    Exception:

    The instruction to edit a dependent that did not live in the United States to position 5 does not apply when the dependent lived with the taxpayer in a foreign country or U.S. Territory.

Dependent Coding

  1. For complete instructions, see IRM 3.11.3.13.2.

Dependent Name Control and TIN

  1. For complete instructions, see IRM 3.11.3.13.4 through IRM 3.11.3.13.4.2.

Form 1040 - General Information

  1. Some returns require special editing procedures. The tax examiner must review the return for taxpayer notations or other indications of the conditions found in the Special Returns section in IRM 3.21.3.9 or IRM 3.11.3.

  2. If there is any indication that the taxpayer is claiming the benefit of Article XXV of the U.S. - Canada Income Tax Treaty (e.g., notated by the taxpayer in the top center margin of the tax return) and Form 1040-NR is not attached, correspond for Form 1040-NR using Form 9143.

    Note:

    Use the following literal when corresponding for Article XXV, "If you are claiming Article XXV, you must file Form 1040-NR. Please complete, sign and return Form 1040-NR along with all necessary forms, schedules and federal tax withholding statements."

Income, Adjustments and Credits - Lines 1 Through 32

  1. Edit amounts on lines 1 through 23 in dollars only.

  2. Edit amounts on lines 24 through 38 in dollars and cents.

Line 1 - Wages
  1. If the taxpayer claims exempt income under IRC 933 on Form 1040, Form 1040A (TY17 and prior) or Form 1040EZ (TY17 and prior), see IRM 3.21.3.77.2.

  2. If the taxpayer claims an exclusion under IRC 931 on Form 1040, Form 1040A (TY17 and prior) or Form 1040EZ (TY17 and prior), see IRM 3.21.3.73.1.2.

  3. If the taxpayer claims exempt income under IRC 893 or 871, see IRM 3.21.3.16.8.

  4. If the taxpayer exempts income under IRC 911 or notates 2555 or 2555-EZ (TY18 and prior) Exclusion on Schedule 1, line 8, see IRM 3.21.3.42.1.

    Caution:

    If a foreign earned income exclusion is claimed on Schedule 1, line 8, ensure that the income is reported on one of the following lines: line 1 of Form 1040, Schedule 1, line 3, Schedule 1, line 5 or Schedule 1, line 6.

  5. For additional instructions, see IRM 3.11.3.

Line 2a - Tax Exempt Interest Income
  1. For complete instructions, see IRM 3.11.3.

Line 2b - Taxable Interest
  1. For complete instructions, see IRM 3.11.3.

Lines 3a and 3b - Qualified and Ordinary Dividends
  1. For complete instructions, see IRM 3.11.3.

Lines 4a and 4b - IRA Distributions and Taxable IRA Distributions
  1. For complete instructions, see IRM 3.11.3.

Lines 5a and 5b - Pensions and Annuities
  1. For complete instructions, see IRM 3.11.3.

Lines 6a and 6b - Total and Taxable Social Security Benefits
  1. If the taxpayer resides in one of the countries listed below, "X" any reported Social Security Benefits where found.

    • Canada

    • Egypt

    • Germany

    • Ireland

    • Israel

    • Italy (must also be a citizen of Italy for the exemption to apply)

      Note:

      In order for Italy to qualify, they must have an Italian address.

    • Romania

    • United Kingdom (including Great Britain, England, Northern Ireland, Scotland, and Wales)

  2. If Social Security income, Form SSA-1042S, Form RRB-1042S, and withholding are the only income/withholding reported on the return, see IRM 3.21.3.15.1.20

  3. If the taxpayer reports worldwide income (i.e., there are multiple types of income and/or withholding reported on the return) AND the only "questionable" aspect of the return is the presence of Form SSA-1042S, process the return as submitted and edit Form SSA-1042S withholding to the dotted portion of line 33 of Form 1040.

  4. For additional instructions, see IRM 3.11.3.

Line 7 - Capital Gain or Loss
  1. For complete instructions, see IRM 3.11.3.

Line 8 - Other Income
  1. For complete instructions, see IRM 3.11.3.

Line 9 - Total Income
  1. Compute and edit line 9 when it is blank, dash, or zero and there are entries on lines 1, 2b, 3b, 4b, 5b, 6b, 7, 8 and/or Schedule 1, line 9.

    Exception:

    Do not adjust or compute line 9 if making an adjustment to line 1 of Form 1040 or Schedule 1, line 8.

Line 10a, 10b, and 10c - Adjustments to Income
  1. For TY20, an additional charitable deduction may be claimed on line 10b.

  2. For complete instructions, see IRM 3.11.3.

Line 11 - Adjusted Gross Income
  1. Compute and edit line 11 when it is blank, dash, zero, or illegible by subtracting line 10c from line 9.

Line 12 - Standard Deductions or Itemized Deductions (Not Transcribed)
  1. If there is an indication near line 12 or a statement for line 12 that the taxpayer is prorating their standard deduction under IRC 933, accept the taxpayer's prorated amount for the standard deduction. Do not correspond for Schedule A.

  2. For additional instructions, see IRM 3.11.3.

Line 13 - Qualified Business Income Deduction
  1. For TY19 and later, if a Qualified Business Income Deduction amount is present, Form 8995 or Form 8995-A must be attached. If missing, correspond for Form 8995-A.

Line 15 - Taxable Income
  1. For complete instructions, see IRM 3.11.3.

Lines 16 and 17 - Tax
  1. For complete instructions, see IRM 3.11.3.

Line 20 - Total Credits
  1. If an amount present on line 20, Schedule 3 must be attached. Correspond if missing.

  2. For additional instructions, see IRM 3.11.3.

Line 23 - Other Taxes
  1. If an amount is present on line 23 and Schedule 2 is not attached or Schedule 2 is attached and lines 4 through 8 are blank, correspond for missing Schedule 2.

    Exception:

    If a Schedule 2 can be dummied from attachments, do not correspond unless already corresponding for other missing information.

  2. For additional instructions, see IRM 3.11.3.

Line 24 - Total Tax
  1. For complete instructions, see IRM 3.11.3.

Lines 25a through 25d - Withholding
  1. U.S. source income is reported on Form W-2, Form 1042-S, Form SSA-1042S, Form RRB-1042S, Form 1099 series, Form 8805, Form 8288-A, or a statement of income.

  2. Valid sources of U.S. Withholding include Form W-2, Form SSA-1042S, Form RRB-1042S, Form 1042-S, Form 1099 series, Form 8805, Form 8288-A and Form 8959. Review all withholding documents to ensure that the withholding amounts claimed by the taxpayer are U.S. Withholding (Federal Income Tax Withheld). Withholding from Guam and CNMI can be claimed on lines 25a through 25d.

    Caution:

    If the only income on the return is from Guam, see IRM 3.21.3.74 or the Commonwealth of the Northern Mariana Islands, see IRM 3.21.3.75.

  3. If the return contains withholding from American Samoa (Form W-2AS), Puerto Rico (Form 499R-2/Form W-2PR) or Virgin Islands (Form W-2VI) take one of the following actions:

    1. If all of the withholding is from American Samoa (Form W-2AS), Puerto Rico (Form 499R-2/Form W-2PR) or Virgin Islands (Form W-2VI) "X" the withholding amounts.

      Caution:

      If the only income on the return is from American Samoa, see IRM 3.21.3.73, Virgin Islands, see IRM 3.21.3.76 or Puerto Rico, see IRM 3.21.3.77.

    2. If U.S. withholding is also claimed, adjust the withholding amount to include only the U.S. withholding.

  4. If line 25d is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and a source of withholding is not attached, correspond for withholding support if unable to verify the amount through research. Minimum requirements for substitute statement are: Name of Employer or EIN, Income and Withholding.

    Exception:

    If the research indicates the withholding is claimed from Form 1042-S, correspond for withholding support.

    Note:

    Research IRP (when available) before corresponding.

  5. Follow the instructions below for line 25d:

    If Line 25d is And Then
    Blank, Dash, or Zero (0) At least one source of withholding is present on Form W-2, Form W-2G, Form 1099 (series) or IRS Transcript Edit the withholding amount(s) to line 25d.

    Exception:

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

    Any amount and support for the withholding is present Any withholding is from:
    • Form 1099-OID or

    • Form 1099-A

    Refer the return to Frivolous Return Program (FRP).
    Any amount The supporting withholding document is a foreign document "X" line 25d.

  6. Edit CCC "8" on a refund return when withholding is significant and there is only a single supporting document attached that is one of the following:

    • A substitute statement (e.g., substitute Form W-2 or employer-provided earnings statement with year-to-date totals) or attachment or worksheet.

      Note:

      If the only support for withholding is from a single or multiple Forms 4852 and there are no other withholding documentation is present, edit CCC "8" .

    • Handwritten

    • Other than computer-printed Form W-2

    • Altered name, SSN, wages, or federal income tax withheld

      Exception:

      Do not edit CCC "8" when Form 1099-R, Form W-2G, or IRS income document is attached, or if the return is identified as a military or combat zone return.

      Note:

      To be considered a "single supporting document," the document must show support from only one employer. Consider Form 4852 and an employer-provided earnings statement with the same employer and identical amounts to be a "single supporting document" .

  7. If Form 1042-S is attached to Form 1040, take the following actions:

    If Then
    Refund and the only income reported is from the Form 1042-S Correspond for filer's U.S. status, using Form 9143, box 24.

    Exception:

    Do not correspond if the taxpayer states they are a U.S. Resident Alien or the taxpayer has provided a copy of their resident alien card. Delete Form 1042-S withholding from line 25d and edit to the dotted portion of line 33.

    "Worldwide Income" is reported or the return is other than a refund Delete Form 1042-S withholding from line 25d and edit to the dotted portion of line 33.

    Note:

    If the taxpayer file Form 1040A (TY17 and prior) or Form 1040EZ (TY17 and prior) the return must be converted to Form 1040, unless corresponding for the filer’s U.S. status.

  8. Delete Form 8805, Foreign Partner’s Information Statement of Section 1446 Withholding Tax, withholding from line 25d and edit to the dotted portion of line 33, Form 1040.

    1. If the TIN on Form(s) 8805 is missing or other than the TIN in the caption area, and the credit is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"X" the credit where reported.

      Exception:

      If a TIN has been newly assigned, but is not on Form 8805 Do Not "X" the credit.

      Note:

      Any statement or document from a withholding agent that is submitted in lieu of Form 8805 must include the name and address of the U.S. withholding agent, the agent’s U.S. TIN (EIN or SSN), and the name in which the tax withheld was reported. If the name or TIN of the taxpayer claiming the refund is different or withholding agent information is not included, "X" the credit.

  9. If Form 8288-A is attached or noted on any line, follow the instructions in IRM 3.21.3.15.1.20 (10), IRM 3.21.3.15.1.20 (11), and IRM 3.21.3.15.1.20 (12).

  10. If any credit is claimed, verify that Form 8288-A is attached and the Date of Transfer on Form 8288-A (box 1) is within the Tax Period of the return being filed.

    1. If Form 8288-A is not attached, correspond.

    2. If the Date of Transfer on Form 8288-A (box 1) is not within the Tax Period of the return, "X" the entry where reported and edit only the credit(s) that are within the tax period of the return. If the return is being filed for a fiscal period, verify that the Date of Transfer falls within the fiscal period.

      Caution:

      If "Original DOT" is notated on the top right side of Form 8288-A, accept that date as the official Date of Transfer.

  11. If the Date of Transfer on Form 8288-A is in 2021 and:

    1. The return is numbered, "X" the credit(s).

    2. The return is unnumbered and Form 843 is attached, detach Form 843 along with Form 8288-A and route to Accounts Management. "X" line 25d and process the return.

    3. The return is unnumbered and Form 843 is not attached, send the return back to the taxpayer. Correspond using Form 9143, box 25.

    Reminder:

    If "Original DOT" is notated on the top right side of Form 8288-A, accept that date as the official Date of Transfer.

  12. Form 8288-A - Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property Interests. All Form 8288-A credits must be verified. If Form 8288-A is attached with a Date of transfer within the Tax Period and the return is:

    1. Numbered, attach a verification slip to request verification of the credit from the FIRPTA Unit and edit Action Code "420" .

    2. Unnumbered, follow the table below:

      If And Then
      Credits have not been verified   Completely code and edit the return, then place return in designated area for verification.

      Note:

      The verification slip (Form 13698) or printout is attached to the tax form after the credit verification is completed.

      Credits are verified The verified amount is the same or greater than the amount the taxpayer reported, Delete the Form 8288-A credit from line 25d and edit the taxpayer’s entry on the dotted portion of line 33.
      Credits are verified The verified amount is less than the amount the taxpayer reported,
      1. "X" the amount reported by the taxpayer.

      2. Delete the amount from line 25d and edit the verified amount to the dotted portion of line 33.

  13. Form 1040 filed with Form SSA-1042S/Form RRB-1042S:

    1. Forms 1040 on which the taxpayer reports worldwide income (wages, interest, investment income, self-employment income, SE tax, etc.) along with Form SSA-1042S/Form RRB-1042S benefits are not subject to the 30% tax rate and should be processed without citizenship or residency documentation. Process per normal Form 1040 procedures. Delete the Form SSA-1042S/Form RRB-1042S withholding from line 25d and edit Form SSA-1042S/Form RRB-1042S withholding to the dotted portion of line 33, Form 1040.

    2. Nonresident aliens who file jointly with a U.S. citizen and elect to be treated as resident aliens for tax purposes are not subject to the 30% tax rate. Process per normal Form 1040 procedures. Delete the Form SSA-1042S/Form RRB-1042S withholding from line 25d and edit Form SSA-1042S/Form RRB-1042S withholding to the dotted portion of line 33, Form 1040.

    3. Residents of U.S. Territories are not subject to the 30% tax rate. Process per normal Form 1040 procedures. Delete the Form SSA-1042S/Form RRB-1042S withholding from line 25d and edit Form SSA-1042S/Form RRB-1042S withholding to the dotted portion of line 33, Form 1040.

  14. A resident alien (without worldwide income) can receive a refund for incorrectly withheld taxes on Social Security Benefits reported on Form SSA-1042S/Form RRB-1042S from SSA or IRS. If SSA cannot refund the taxes withheld, the IRS will process a tax return and refund the withholding when ALL the criteria below is met:

    • The taxpayer files either Form 1040 or Form 1040A (TY17 and prior)

    • A copy of the "green card" is attached

    • A signed declaration is attached that includes the following statement (or a signed statement with similar wording):
      "The SSA withheld taxes erroneously because I am a U.S. permanent resident and my green card has neither been revoked nor administratively or judicially determined to have been abandoned. I am filing a U.S. income tax return for the taxable year as a resident alien reporting all of my worldwide income. I have not yet claimed benefits for the taxable year under an income tax treaty as a nonresident alien."

    Note:

    If the taxpayer has filed Form 1040EZ (TY17 and prior), convert to Form 1040.

    1. If the taxpayer is filing to claim a refund and does not attach a green card and/or declaration statement (see criteria above), "X" the withholding and correspond for the following if missing:
      • Green card

      Note:

      The reference made to green card includes, Form I-551 for all years after 1996 and Form I-151 is only acceptable as proof of permanent residency for TY96 and prior. See Exhibit 3.21.3-13


      • A signed declaration statement

    2. If the taxpayer is claiming a refund, both green card and declaration statement are attached, and none of the conditions in IRM 3.21.3.15.1.20 (13) are met, "X" the withholding.

Line 26 - Estimated Tax Payments Applied from Prior Year Return (ES)
  1. For complete instructions, see IRM 3.11.3.

Line 27 - Earned Income Credit (EIC)
  1. Taxpayers residing outside of the U.S. are generally not entitled to EIC.

  2. If the taxpayer is not claiming EIC, edit RPC "B" .

  3. If a taxpayer is claiming EIC and attaches a valid Form 2555 or Form 2555-EZ (TY18 and prior), and excludes foreign earned income, "X" both the line 27 amount, Form 1040 and Schedule EIC.

  4. If the taxpayer is claiming EIC and claims income is exempt under IRC 933, disallow EIC. "X" both line 27, Form 1040 and Schedule EIC, if attached.

  5. If the taxpayer is claiming EIC and resided outside of the U.S. for the entire year, disallow EIC. "X" both line 27, Form 1040 and Schedule EIC, if attached.

    Note:

    Do not use the caption address to determine if the taxpayer resided outside the U.S. for the entire year.

  6. If the return has a U.S. address and all income is from a U.S. territory (e.g., wages or self-employment) then "X" both line 27, Form 1040 and Schedule EIC, if attached.

  7. If none of the conditions in paragraphs (3) through (6) are present, the taxpayer may qualify for EIC if they resided inside the U.S. for part of the tax year and they also meet all requirements for EIC at IRM 3.11.3.14.2.33. Indications that the taxpayer resided inside the U.S. for part of the tax year are either:

    • The taxpayer's address on Form(s) W-2 is one of the 50 states or District of Columbia or

    • The taxpayer paid state or local taxes to one of the 50 states or District of Columbia

    Note:

    The taxpayer’s address in the caption and the employer’s address on Form(s) W-2 are not indications.

    1. If the taxpayer qualifies, allow EIC.

    2. If the taxpayer does not qualify, "X" line 27 and Schedule EIC.

  8. U.S. military personnel stationed outside of the U.S. on extended active duty are considered to live in the U.S. during that duty period for purposes of the EIC. They must also meet all requirements for EIC at IRM 3.11.3.14.2.33. If the taxpayer meets all requirements, allow EIC. To determine whether the taxpayer is military personnel, search the signature area, Forms W-2(s) and/or attachments for any of the following indications:

    1. The occupation in signature area indicates U.S. Air Force, U.S. Army, U.S. Coast Guard, U.S. Marines, U.S. Navy, etc.

    2. DCPS CIVPAY DIRECTORATE

    3. DFAS - PE/P

    4. DFAS - ATTN: DFAS - PMTC/IN

    5. Defense Finance and Accounting Service Cleveland Center

    6. USAF - Active Duty

    7. DFAS - PMJFC/DE

    8. Commanding Office USCG Human Resources Service Information Center

  9. Correspond when EIC is being claimed and the source of income is not indicated or attached (W-2) and cannot be determined through research:

    1. If using Form 13900, use paragraph g.

    2. If using Form 9143, use paragraph 10.

  10. For additional instructions, see IRM 3.11.3.

Nontaxable Combat Pay Election (to the left of line 27)
  1. Nontaxable Combat Pay Election is a write-in by the taxpayer to the left of line 27. Take no action.

Line 28 - Additional Child Tax Credit (Schedule 8812)
  1. If the taxpayer is a resident of Puerto Rico, reporting earned income in Puerto Rico (Form(s) 499R-2/W-2PR) and claiming additional child tax credit, see IRM 3.21.3.77.1.1 (2).

    Exception:

    If you can determine the taxpayer is U.S. military personnel, see instructions below.

    Note:

    Do not convert Form 1040 or Form 1040A (TY17 and prior) to Form 1040-PR.

  2. If the taxpayer is a resident of CNMI, Guam, American Samoa or Virgin Islands "X" line 28 unless IRM 3.21.3.15.1.24 (3) applies.

  3. If the taxpayer is a resident in any of the U.S. territories and you can determine the taxpayer is U.S. Military personnel, the taxpayer is considered a resident of the U.S. for the entire year and the return should be processed using the domestic instructions in IRM 3.11.3. Search the occupation area, Forms W-2, and/or attachments for any, such as the following indications:

    1. The occupation in the signature area indicates military, U.S. Air Force, U.S. Army, U.S. Coast Guard, U.S. Marines, or U.S. Navy.

    2. DCPS CIVPAY DIRECTORATE

    3. DFAS-PE/P

    4. DFAS-ATTN:DFAS-PMTC/IN

    5. Defense Finance and Accounting Service Cleveland Center

    6. USAF- Active Duty

    7. DFAS-PMJFC/DE

    8. Commanding Office USCG Human Resources Service Information Center

  4. If an amount is present on line 28 and three or more children with SSNs are claimed as dependents, Schedule 8812 must be attached. Correspond if missing

    Exception:

    If Form W-2 series or Form 499R-2/W-2PR is attached, dummy Schedule 8812, line 9.

Line 29 - Refundable Education Credit
  1. If an amount is claimed on 29, Form 8863 must be attached. If missing, correspond for Form 8863.

    Note:

    If the taxpayer has an entry on both Schedule 3, line 3 and Form 1040, line 29, correspond for only one missing Form 8863. Use the first entry amount and line number on the return/Schedule.

Line 30 - Recovery Rebate Credit
  1. The Recovery Rebate Credit is the TY20 tax credit taxpayers use to claim any portion of the Economic Impact Payment which was not received as an advance credit in TY19.

  2. For complete instructions, see IRM 3.11.3.

Line 31 - Other Payments and Credits
  1. For complete instructions, see IRM 3.11.3.

Line 32 - Total Other Payments and Refundable Credits
  1. Compute and edit line 32 when blank and there are entries leading to a total.

Line 33 - Total Payments
  1. Take one of the following actions when there is an amount on line 33 and lines 25d through 32 are blank and no withholding documents are present.

    If there is an amount on line 33 of And Then
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ there is a significant entry on line 1, 4b or 5b of Form 1040, or Schedule 1, line 7 Correspond for an explanation of line 33 of Form 1040.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ there are no significant entries on lines 1, 4b or 5b of Form 1040, or Schedule 1, line 7 Edit the amount to Form 1040, line 26.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ there is a significant entry on line 1, 4b or 5b of Form 1040, or Schedule 1, line 7 Edit the amount to line 25d of Form 1040 and edit RPC "G."
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ there is no significant entry on line 1, 4b or 5b of Form 1040, or Schedule 1, line 7 Edit the amount to Form 1040, line 26

  2. For additional instructions, see IRM 3.11.3.

Refund or Amount Owed - Lines 34 through 38

  1. Line 34 is not a T-line. Lines 35a and 37 are T-Compute lines.

Line 35a - Refund
  1. For complete instructions, see IRM 3.11.3.

Lines 35b, 35c and 35d - Direct Deposit Information
  1. For complete instructions, see IRM 3.11.3.

Line 36 - ES Credit Elect
  1. For complete instructions, see IRM 3.11.3.

Line 37 - Amount You Owe (Balance Due)
  1. For complete instructions, see IRM 3.11.3.

Line 38 - Estimated Tax Penalty (Form 2210 or Form 2210F)
  1. For complete instructions, see IRM 3.11.3.

Third Party Designee

  1. Reserved

Signature

  1. For complete instructions, see IRM 3.11.3.

Occupation

  1. Reserved

Identity Protection Personal Identification Number (IP-PIN)

  1. Identity Protection Personal Identification Number (IP PIN) is located in the "Sign Here" area of the return.

  2. For additional instructions, see IRM 3.11.3.

Paid Preparer Data

  1. For complete instructions, see IRM 3.11.3.

Preparer Code
  1. For complete instructions, see IRM 3.11.3.

Preparer TIN (PTIN)
  1. For complete instructions, see IRM 3.11.3.

Preparer Phone Number
  1. For complete instructions, see IRM 3.11.3.

Schedule 1 (Sequence 01) - Additional Income and Adjustments to Income

  1. The following information pertains to Schedule 1 only.

  2. For TY20 and later, Schedule 1 may be filed with Form 1040 or Form 1040-NR. See IRM 3.21.3.81.19.

  3. The following are the T-lines and T-Compute lines on Schedule 1:

    T-Lines T-Compute Lines
    Line 1 There are no T-Compute Lines
    Line 2a  
    Lines 3 through 8  
    Lines 10 through 18a  
    Lines 19 through 21  
    982 Indicator (dotted area left of line 10)  
    MSA (dotted area to the left of Line 21)  
    Dotted portion of Line 22  

  4. Lines 1 through 9 are for additional income and lines 10 through 22 are for adjustments to income

  5. For additional instructions, see IRM 3.11.3.

Schedule 1, Line 1 - Taxable Refunds

  1. Reserved

Schedule 1, Lines 2a and 2b - Alimony Received and Date of Divorce

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 3 - Business Income or Loss

  1. If a foreign earned income exclusion is claimed on Schedule 1, line 8, ensure that the income is reported on any of lines 1 of Form 1040, Schedule 1, line 3, Schedule 1, line 5 or Schedule 1, line 6.

  2. If a taxpayer residing in American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico or U.S. Virgin Islands files Form 1040, reporting self-employment taxes on Schedule 2, line 4, and the only income on the return is from Schedule C, Schedule E (Part II) and/or Schedule F, prepare a dummy Form 1040-SS as follows:

    1. Edit the caption and transcription lines.

    2. "X" Form 1040 and attach all information behind the dummy Form 1040-SS.

    Caution:

    If the taxpayer is claiming wages and/or withholding, do not convert.

  3. If Schedule 1, line 3 contains Self-Employment income of $434 or more and Schedule SE is not attached and Schedule 2, line 4 does not have a significant entry:

    • Edit RPC "S" if the taxpayer resides in one of the following countries:

      RPC "S" Countries:
      Australia
      Austria
      Belgium
      Brazil
      Canada
      Chile
      Czech Republic
      Denmark
      Finland
      France
      Germany
      Greece
      Hungary
      Iceland
      Ireland
      Italy
      Japan
      Luxembourg
      Netherlands
      Norway
      Poland
      Portugal
      Slovak Republic (Slovakia)
      Slovenia
      South Korea
      Spain
      Sweden
      Switzerland
      United Kingdom

      Reminder:

      Includes Great Britain, England, Northern Ireland, Scotland, and Wales

      Uruguay

  4. For additional instructions, see IRM 3.11.3.

    Exception:

    Do not correspond for SE tax liability when the taxpayer resides in one of the countries listed in IRM 3.21.3.16.3 (3) above.

Schedule 1, Line 4 - Other Gains or Losses

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 5 - Rental Real Estate, Royalties, Partnerships, S Corporations, or Trusts

  1. If a foreign earned income exclusion is claimed on Schedule 1, line 8, ensure that the income is reported on any of lines 1 of Form 1040, Schedule 1, line 3, Schedule 1, line, 5 or Schedule 1, line 6.

  2. If a taxpayer residing in American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico, or U.S. Virgin Islands files Form 1040, reporting self-employment taxes on Schedule 2, line 4, and the only income on the return is from Schedule C, Schedule E (Part II) and/or Schedule F, prepare a dummy Form 1040-SS as follows:

    1. Edit the caption and transcription lines.

    2. "X" Form 1040 and attach all information behind the dummy Form 1040-SS.

    Caution:

    If the taxpayer is claiming wages and/or withholding, do not convert.

  3. For additional instructions, see IRM 3.11.3.

Schedule 1, Line 6 - Farm Income or Loss

  1. If a foreign earned income exclusion is claimed on Schedule 1, line 8 then ensure that the income is reported on any of the lines 1 of Form 1040, Schedule 1, line 3, Schedule 1, line 5 or Schedule 1, line 6.

  2. If a taxpayer residing in American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico or U.S. Virgin Islands files Form 1040, reporting self-employment taxes on Schedule 2, line 4, and the only income on the return is from Schedule C, Schedule E (Part II) and/or Schedule F, prepare a dummy Form 1040-SS as follows:

    1. Edit the caption and transcription lines.

    2. "X" Form 1040 and attach all information behind the dummy Form 1040-SS.

    Caution:

    If the taxpayer is claiming wages and/or withholding, do not convert.

  3. If Schedule 1, line 6 contains Self-Employment income of $434 or more and Schedule SE is not attached and Schedule 2, line 4 does not have a significant entry:

    • Edit RPC "S" if the taxpayer resides in one of the following countries:

      RPC "S" Countries:
      Australia
      Austria
      Belgium
      Brazil
      Canada
      Chile
      Czech Republic
      Denmark
      Finland
      France
      Germany
      Greece
      Hungary
      Iceland
      Ireland
      Italy
      Japan
      Luxembourg
      Netherlands
      Norway
      Poland
      Portugal
      Slovak Republic (Slovakia)
      Slovenia
      South Korea
      Spain
      Sweden
      Switzerland
      United Kingdom

      Reminder:

      Includes Great Britain, England, Northern Ireland, Scotland, and Wales

      Uruguay

  4. For additional instructions, see IRM 3.11.3.

    Exception:

    Do not correspond for SE tax liability when the taxpayer resides in one of the countries listed in IRM 3.21.3.16.6 (3) above.

Schedule 1, Line 7 - Unemployment Compensation (UEC)

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 8 - Other Income

  1. For International entries on Line 8, follow the table below:

    Line Entry And Action
    Article XXV of the U.S. - Canada Income Tax Treaty Form 1040-NR is not attached Correspond for Form 1040-NR. See IRM 3.21.3.80.5.

    Note:

    Use Form 9143 and the following literal when corresponding for Article XXV, "If you are claiming Article XXV, you must file Form 1040-NR. Please complete, sign and return Form 1040-NR, along with all necessary forms, schedules and federal tax withholding statements."

    Form 2555 or Form 2555-EZ (TY18 and prior) Form 2555 or Form 2555-EZ (TY18 and prior) is missing Correspond
    Form 2555 or Form 2555-EZ (TY18 and prior) Taxpayer resides in:
    • Baker Island

    • Howland Island

    • Jarvis Island

    • Johnston Atoll

    • Kingman Reef

    • Midway Islands

    • Palmyra Atoll

    • Wake Island

    Take the following actions:
    1. "X" Schedule 1, line 8, (Foreign Earned Income Exclusion)

    2. "X" the dotted portion of Schedule 1, line 22

    3. "X" Form 2555 or Form 2555-EZ (TY18 and prior)

    4. Ensure the income is reported on the appropriate line(s): 1 of Form 1040 or Schedule 1, lines 3, 5 or 6

    5. If the deleted Form 2555 or Form 2555-EZ is the only foreign aspect of the return, rebatch as domestic

    Form 2555 or Form 2555-EZ (TY18 and prior) Two Forms 2555 and/or Form 2555-EZ (TY18 and prior) are submitted and only one Form 2555 and/or Form 2555-EZ is valid Adjust Schedule 1, line 8, (if necessary) to exclude the amount for the invalid Form 2555 or Form 2555-EZ
    Form 2555 or Form 2555-EZ (TY18 and prior) Positive amount Take the following actions:
    1. Amount has been verified to be an exclusion, bracket the amount

    2. Amount is income, "X" the Schedule 1, line 8 entry and edit to line 1 of Form 1040

    IRC 871 (Capital Gains) Taxpayer excludes income on Schedule 1, line 8 If the income is not included on Form 1040, line 7 and/or Schedule 1, line 4, edit the income to Form 1040, line 7.
    IRC 893 or "Employee of International Organization and Foreign Government" Taxpayer provides all of the following:
    • Evidence of non-U.S. citizen status (e.g., a copy of your A or G visa or green card

    • Written evidence from the U.S. Citizenship and Immigration Service confirming USCIS Form I-508 has not been signed.

    • Evidence they are an employee of a foreign government, a copy of the U.S. State Department Internal Revenue Code (IRC) Section 893(b) certification if one has been issued, or other evidence of meeting the requirements of IRC Section 893(a)(2) and (3).

    • Evidence they are an employee of an international organization listed in Exhibit 3.21.3-4.

    • Number of a Presidential Executive Order listed in Exhibit 3.21.3-4.

    Allow the exempt amount on Schedule 1, line 8. If the income is not reported on Lines 1 of Form 1040, or Schedule 1, lines 3, 5 and/or 6, edit the income to line 1 of Form 1040.
    IRC 893 or "Employee of International Organization and Foreign Government" Taxpayer does not provide ALL items listed in the box above. Correspond. When using Form 13900, mark box K

    Exception:

    North Atlantic Treaty Organization (NATO) also known as the Ottawa Agreement and the organizations listed at Exhibit 3.21.3-4 have already been designated by the president and do not require correspondence with the taxpayer.

    IRC 911   See Form 2555
    IRC 931   See IRM 3.21.3.73.1.2.
    IRC 933   See IRM 3.21.3.77.2.
    Negative amount Taxpayer notates foreign income Correspond for an explanation.
    One or more are true:
    • Self-Employment Income

    • Form 1099-NEC, box 1 amount present

    • Form 1099-MISC, box 7 amount present

    Form 2555 or Form 2555-EZ (TY18 and prior) is attached to exclude the income Edit the Self-Employment income, Form 1099-NEC, box 1, or Form 1099-MISC, box 7 amount present to line 1 of Form 1040.
    One or more of the following:
    • Self-Employment Income

    • Form 1099-MISC, box 7 amount present

    • Form 1099-NEC, box 1 amount present

    Self-Employment income is $434 or more and Schedule SE is not attached and Schedule 2, line 4 does not have a significant entry Edit RPC "S" if the taxpayer resides in one of the following:
    • Australia

    • Austria

    • Belgium

    • Brazil

    • Canada

    • Chile

    • Czech Republic

    • Denmark

    • Finland

    • France

    • Germany

    • Greece

    • Hungary

    • Iceland

    • Ireland

    • Italy

    • Japan

    • Luxembourg

    • Netherlands

    • Norway

    • Poland

    • Portugal

    • Slovak Republic (Slovakia)

    • Slovenia

    • South Korea

    • Spain

    • Sweden

    • Switzerland

    • United Kingdom

      Reminder:

      Includes Great Britain, England, Northern Ireland, Scotland, and Wales)

    • Uruguay

    Note:

    If the taxpayer does not reside in one of the countries listed above, edit RPC "N"

    Treaty Taxpayer provides:
    • The name of the foreign country of which the taxpayer is a citizen or resident and whose tax treaty with the U.S. provides the exempt status.

    • The treaty article number that allows the exemption.

    • The amount of "exempt" income during the tax year.

    Validate the treaty using Exhibit 3.21.3-10
    1. If valid and the taxpayer has not already reported the income, edit the income to the appropriate line and edit the exempt income on Schedule 1, line 8 as a negative amount, if not already present.

      Exception:

      Taiwan and Hong Kong are not considered to be China and are not allowed to exclude income per China treaties.

    2. If valid, but the taxpayer excludes more than the amount allowed by the treaty, adjust the excluded amount to the allowable limit of the exclusion. Ensure the income is reported.

      Note:

      If the Schedule 1, line 8 treaty amount exceeds the allowable deduction, "X" Schedule 1, line 8. Edit the allowable amount per the treaty to Schedule 1, line 8.

    3. If invalid, "X" Schedule 1, line 8 and make sure the income is reported.

    Treaty Taxpayer does not provide ALL items listed above. Correspond

  2. A Fulbright Grant received by a U.S. citizen or U.S. resident alien taxpayer for the purpose of lecturing or teaching in a foreign country is considered a payment for services and is subject to U.S. tax.

    Note:

    If the Fulbright Grant was paid by an agency of the U.S. Government, the income may be excluded under the IRC 911, provided the taxpayer is not a U.S. government employee.

  3. If the housing deduction amount (line 50, Form 2555) is entered on Schedule 1, line 8, "X" the entry and edit to the dotted portion of Schedule 1, line 22. Adjust Schedule 1, line 8 to exclude the housing deduction if both housing deduction and foreign income exclusion are claimed on Schedule 1, line 8 and edit the housing deduction to the dotted portion of Schedule 1, line 22. See IRM 3.21.3.42.9 (7).

  4. Qualified airline employees may exclude some income reported as wages in box 1, Form W-2. This income will be included on line 1 of Form 1040 and excluded as a negative on line 8 as "airline payment" . Accept as filed.

  5. For additional instructions, see IRM 3.11.3.

Schedule 1, Line 10 - Educator Expenses

  1. Reserved.

Schedule 1, Line 11 - Certain Business Expenses of Reservists, Performing Artists and Fee Basis Government Officials (Form 2106)

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 12 - Health Savings Account Deduction (Form 8889)

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 13 - Moving Expenses for Members of the Armed Forces (Form 3903)

  1. Moving Expenses for Members of the Armed Forces (Form 3903 or similar statement) must be attached ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ If missing, correspond for Form 3903.

    Note:

    If the taxpayer is only claiming an expense for storage fees while out of the United States, Form 3903 is not required.

Schedule 1, Line 14 - Deduction for Self-Employment Tax

  1. Reserved

Schedule 1, Line 15 - Self-Employed SEP, SIMPLE and Qualified Plans

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 16 - Self-Employed Health Insurance Deduction

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Lines 18a, 18b, and 18c - Alimony Paid, Alimony Recipient's TIN, Date of Divorce

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 19 - IRA Deduction

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 20 - Student Loan Interest Deduction

  1. Reserved

Schedule 1, Line 21 - Tuition and Fees (Form 8917)

  1. For complete instructions, see IRM 3.11.3.

Schedule 1, Line 22 - Dotted Portion (Total Adjustments)

  1. If an amount claimed on Schedule 1, line 22 or near the dotted portion of Schedule 1, line 22 is identified as "Form 2555," "IRC 911" or "IRC 931:"

    If And Then
    The U.S. citizen resides in any of the following territories:
    • Baker Island

    • Howland Island

    • Jarvis Island

    • Johnston Atoll

    • Kingman Reef

    • Midway Island

    • Palmyra Atoll

    • Wake Islands

     
    1. "X" Schedule 1, line 8 and the dotted portion of Schedule 1, line 22

    2. "X" Form 2555, if attached.

    The taxpayer does NOT reside in one of the areas mentioned above Form 2555 is missing Correspond for Form 2555.

  2. Edit the housing deduction amount from line 50, Form 2555 to the dotted portion of Schedule 1, line 22, if not already entered by the taxpayer.

    Note:

    If the housing deduction amount is entered on any line other than the dotted portion of Schedule 1, line 22, "X" the entry and edit it to the dotted portion of Schedule 1, line 22.

  3. Delete any amount claimed on Schedule 1 lines 10 through 22 identified as "MSA" or "Archer MSA Deduction" . Edit the amount in dollars only to the area left of the line numbers 19 and 21 with the label "MSA" to the left of the amount.

  4. Delete the following adjustments from Schedule 1, lines 10 through 21 and edit the amount to the dotted portion of line 22.

    Note:

    Include these amounts in the Schedule 1, line 22 total.

    • "ED67(e)" - (TY18 and later) Excess deductions - section 67(e) expenses on Form 1041 Schedule K-1.

    • "403(b)" - Contributions by certain chaplains to section 403(b) plans

    • "501(c)(18)(D)"

    • "UDC"

    • "WBF"

    • "Jury Pay"

    • "PPR" - Personal Property Rental

    • "Reforestation," "RFST" - Forestation/reforestation amortization

    • "Sub-Pay TRA" - Repayment of Supplemental Unemployment Benefit (SUB) payments received in a prior year under the Trade Act of 1974 (TRA).

      Exception:

      "X" the SUB pay amount where found and subtract the amount from line 1, Form 1040 when there is no indication that the adjustment is for benefits received in a prior year.

    • "Housing Deduction" - line (2)50, Form 2555

    • "USOC" - United States Olympic Committee

  5. Delete these adjustments where found and edit the amount to the dotted portion of Schedule 1, line 22 when any of the adjustments in IRM 3.21.3.16.20 (4) are claimed elsewhere on the return.

  6. "X" the amount if a taxpayer claims an adjustment to income on the dotted portion of Schedule 1, line 22 for anything other than the items listed in IRM 3.21.3.16.20 (1) or IRM 3.21.3.16.20 (4) above.

  7. "X" the amount when there is no explanation present for an adjustment amount.

Schedule 1, Line 22 - Total Adjustments to Income

  1. For complete instructions, see IRM 3.11.3.

Schedule 2 (Sequence 02) - Additional Taxes

  1. The following information pertains to Schedule 2 only.

  2. For TY20 and later, Schedule 2 may be filed with Form 1040 or Form 1040-NR. See IRM 3.21.3.81.20.

  3. The following are the T-lines and T-Compute Lines on Schedule 2:

    T-Lines T-Compute Lines
    Lines 1-2 There are no T-Compute Lines
    Lines 4-9  

  4. Lines 1 through 3 are for tax and lines 4 through 10 are for other taxes

  5. For additional instructions, see IRM 3.11.3.

Schedule 2, Line 1 - Alternative Minimum Tax (Form 6251)

  1. If an amount is present on Schedule 2, line 1, Form 6251 must be attached. Correspond if missing.

Schedule 2, Line 2 - Excess Advance Premium Tax Credit Repayment (Form 8962)

  1. If an amount is claimed on Schedule 2, line 2, Form 8962 must be attached. Correspond if missing.

    1. When corresponding for Form 8962 on Form 13900, also correspond for Form 1095-A if not attached, using paragraph "y" .

    2. When corresponding for Form 8962 on Form 9143, also correspond for Form 1095-A if not attached, using the following literal:
      "Send us a copy of your Form 1095-A, Health Insurance Marketplace Statement, to support your entries on Form 8962, Premium Tax Credit. If you didn't receive a Form 1095-A or it is incorrect, visit www.healthcare.gov or your state Marketplace website."

Schedule 2, Line 3 - Total

  1. Reserved

Schedule 2, Line 4 - Self-Employment Tax (Schedule SE)

  1. If a taxpayer residing in American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico or U.S. Virgin Islands files Form 1040, reporting self-employment taxes on Schedule 2, line 4, and the only income on the return is from Schedule C, Schedule E (Part II) and/or Schedule F, prepare a dummy Form 1040-SS as follows:

    1. Edit the caption and transcription lines.

    2. "X" Form 1040 and attach all information behind the dummy Form 1040-SS.

    Caution:

    If the taxpayer is claiming wages and/or withholding, do not convert.

  2. For additional instructions, see IRM 3.11.3.

Schedule 2, Line 5 - Unreported Social Security and Medicare Tax (Form 4137 or Form 8919)

  1. For complete instructions, see IRM 3.11.3.

Schedule 2, Line 6 - Additional Tax on IRAs, Other Qualified Retirement Plans, and Other Tax Favored Accounts (Form 5329)

  1. For complete instructions, see to IRM 3.11.3.

Schedule 2, Lines 7a and 7b - Household Employment Taxes from Schedule H and First Time Homebuyer Credit Repayment

  1. If an amount is present on line 7a, Schedule H must be attached. Correspond for Schedule H if missing.

Schedule 2, Line 8 - Other Taxes (Form 8959 or Form 8960)

  1. For complete instructions, see IRM 3.11.3.

Schedule 2, Line 9 - Section 965 Net Tax Liability Installment (Form 965-A)

  1. If an amount is present on line 9, edit RPC "F" .

  2. If an amount is present on line 9, and Form 965-A is missing, correspond for Form 965-A only if corresponding for other missing information.

    Note:

    If Form 965-A is attached and there is no entry on line 9, do not edit RPC "F" .

Schedule 2, Line 10 - Total Other Taxes

  1. Reserved

Schedule 3 (Sequence 03) - Nonrefundable Credits

  1. The following information pertains to Schedule 3 only.

  2. For TY20 and later, Schedule 3 may be filed with Form 1040 or Form 1040-NR. See IRM 3.21.3.81.21.

  3. The following lines are T-Lines and T-Compute Lines on Schedule 3:

    T-Lines T-Compute Lines
    Line 1 through 6 There are no T-Compute lines
    Lines 6a, 6b and 6c  
    Lines 8 through 11  
    Line 12a, 12b, 12e, 12f  

  4. Lines 1 through 7 are for non-refundable credits and lines 8 through 13 are for other payments and refundable credits.

  5. "X" Schedule 3 if there are no significant T-line entries present or edited on Schedule 3.

  6. Only one Schedule 3 can be processed. If more than one is attached, take the following actions:

    1. Combine related T-line amounts onto one schedule.

    2. "X" those schedules not used.

Schedule 3, Line 1 - Foreign Tax Credit (Form 1116)

  1. If an amount of more than $300 (more than $600 for FS 2) is claimed, Form 1116 or similar statement must be attached. Correspond for Form 1116 if missing or if no significant amounts are present on lines 7, 8, 24 or 35, Form 1116.

  2. Taxpayers earning income in the following countries are not allowed to take a foreign tax credit for foreign taxes paid. If the taxpayer takes the foreign tax credit (see Form 1116 Part II, line 8) with respect to taxes paid to any of the following countries (see Form 1116 Part I, letter i, column A, B, or C), "X" both line 8, Form 1116 and Schedule 3, line 1.

    Country Starting Date Ending Date
    Iran January 1, 1987 Still in Effect
    North Korea January 1, 1987 Still in Effect
    Sudan February 12, 1994 Still in Effect
    Syria January 1, 1987 Still in Effect

Schedule 3, Line 2 - Credit for Child and Dependent Care Expenses (Form 2441)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 3 - Education Credits (Form 8863, line 19)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 4 - Retirement Savings Contribution Credit (Form 8880)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 5 - Residential Energy Credit (Form 5695)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 6 - Other Credits

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 7 - Total Nonrefundable Credits

  1. Reserved

Schedule 3, Line 8 - Net Premium Tax Credit (Form 8962)

  1. If an amount is claimed on Schedule 3, line 8 Form 8962 must be attached. Correspond if missing.

    1. When corresponding for Form 8962 on Form 13900, also correspond for Form 1095-A if not attached, using paragraph "y" .

    2. When corresponding for Form 8962 on Form 9143, also correspond for Form 1095-A if not attached, using the following literal:
      "Send us a copy of your Form 1095-A, Health Insurance Marketplace Statement, to support your entries on Form 8962, Premium Tax Credit. If you didn't receive a Form 1095-A or it is incorrect, visit www.healthcare.gov or your state Marketplace website."

Schedule 3, Line 9 - Amount paid with request for Extension (Form 4868)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 10 - Excess Social Security and Tier 1 RRTA Tax Withheld

  1. Taxpayers in U.S. Territories may claim excess Social Security and RRTA taxes withheld. However, the withholding must be verified via attached Form(s) W-2AS, Form W-2CM, Form W-2GU, Form W-2VI, Form 499R-2/W-2PR, and Form W-2.

  2. For additional instructions, see IRM 3.11.3.

Schedule 3, Line 11 - Credit for Federal Tax on Fuels (Form 4136)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 12a - Form 2439

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 12b - Sick and Family Leave Credits (Schedule H and Form 7202)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 12d - Other (Not Transcribed)

  1. If line 12d was used for refundable credits that do not have a specific line, take the following actions:

    If the credit claimed is Then
    Form 8689 Delete the Form 8689 credit from line 12d and see IRM 3.21.3.76.1.2 for additional instructions.
    Form 8805 If Form 8805 is attached, delete Form 8805 withholding from line 12d and edit to dotted portion of line 33, Form 1040. If Form 8805 is not attached, correspond.
    Form 1042-S If Form 1042-S is attached, delete Form 1042-S withholding from line 12d and edit to the dotted potion of line 33, Form 1040. If Form 1042-S is not attached, correspond.
    Form 8288-A Delete Form 8288-A withholding from line 12d. If Form 8288-A is attached with a Date of Transfer within the tax period of the return, edit the verified amount to the dotted portion of line 33, Form 1040. If Form 8288-A is not attached, correspond.

  2. For additional instructions, see IRM 3.11.3.

Schedule 3, Line 12e - Deferred Taxes (Schedule H or Schedule SE)

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 12f - Total of 12a through 12e

  1. For complete instructions, see IRM 3.11.3.

Schedule 3, Line 13 - Total Other Payments and Refundable Credits

  1. Reserved

Conversion of Form 1040A (TY17 and prior) and Form 1040EZ (TY17 and prior)

  1. Form 1040A and Form 1040EZ are valid for TY17 and prior only.

  2. Convert all Form 1040A and Form 1040EZ to Form 1040.

  3. Convert international conditions as follows:

    Attached to or Entry on Form 1040A or Form 1040EZ Action on Form 6114 or appropriate schedules
    • Form 1042-S with "Worldwide Income"

    • Form SSA-1042S attached to Form 1040EZ

    • Form 8288-A (after FIRPTA verification)

    • Form 8689

    • Form 8805

    Edit withholding to the dotted portion of line 33, Form 6114
    Form 4563 or IRC 931 See IRM 3.21.3.73.1.3.
    Housing Deduction Edit housing deduction from line 50, Form 2555 to the dotted portion of line 22, Schedule 1
    IRC 871 Edit capital gain income to line 7, Form 6114 and edit exempt amount on line 8, Schedule 1 as a negative
    IRC 893 Edit earned income to line 1, Form 6114 and edit exempt amount on line 8, Schedule 1 as a negative
    Valid Form 2555 or Form 2555-EZ or IRC 911 Edit foreign income to line 1, Form 6114 and edit foreign earned income exclusion on line 8, Schedule 1 as a negative
    Valid Treaty Exempt Income Edit treaty exempt income to line 1, Form 6114 and edit treaty exempt income exclusion on line 8, Schedule 1 as a negative

  4. For additional instructions, see IRM 3.11.3.80.2

  5. For general conversion instructions, see IRM 3.11.3.73 and IRM 3.11.3.73.1.

Schedule A (Sequence 07) - Itemized Deductions

  1. The following lines on Schedule A are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 1 Line 4
    Line 3 Line 7
    Line 4 Line 10
    General Sales Tax Checkbox Line 14
    Lines 5a through 5c Line 17
    Lines 6 and 7  
    Lines 8a through 8d  
    Lines 9 through 17  
    Line 18 Checkbox  

  2. If the taxpayer is prorating their itemized deductions (Schedule A) under IRC 933, accept the taxpayer’s prorated amount for itemized deductions. When two amounts are present on line 17, Schedule A, "X" out the larger amount.

  3. A taxpayer may take a deduction on line 6, Schedule A for taxes paid or accrued during the year to:

    • a foreign country or certain U.S. Territory

    • any political subdivision, agency or instrumentality of the country or territory

  4. Schedule A, (sequence 07A), Schedule NEC (sequence 07B), and Schedule OI (sequence 07C) are attachments for Form 1040-NR.

  5. For additional instructions, see IRM 3.11.3.

Schedule B (Sequence 08) - Interest and Ordinary Dividends

  1. The following lines on Schedule B are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 2: Edit to the left of line 2 There are no T-Compute Lines
    Line 3  
    Line 6: Edit above the instructions for line 6  
    Foreign Account Indicator  
    FinCEN Form 114 Indicator, Report of Foreign Bank and Financial Accounts (FBAR)  

  2. For additional instructions, see IRM 3.11.3.

Schedule C (Sequence 09, 10, 11) - Profit or Loss from Business

  1. The following lines on Schedule C are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    SSN Line 1
    Lines A, B, C, D, F, H, I and J Line 2
    Statutory Employee Indicator Box Line 3
    Lines 1 through 4 Line 28
    Line 6  
    Line 9  
    Line 13  
    Line 15  
    Line 16a  
    Line 17  
    Line 18  
    Line 21  
    Lines 24a and 24b  
    Line 25  
    Lines 26 through 27a  
    Line 28  
    Line 30  
    Line 32, "At Risk" Indicator (No editing required)  
    Line 35  
    Line 41  

  2. If the taxpayer is a bona fide resident of PR and indicates Schedule C income is excluded under IRC 933, take the following actions:

    1. "X" the schedule

    2. Prepare a dummy schedule

    3. For Schedule C, edit $1 for Gross Receipts (line 1) and edit the NAICS code if furnished by the taxpayer. Do not compute line 3.

  3. For additional instructions, see IRM 3.11.3.

Schedule D (Sequence 12) - Capital Gains and Losses

  1. The following lines on Schedule D are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Yes/No Checkbox Line 7
    Line 1a, columns (d) and (e) Line 15
    Lines 1b - 3, columns (d), (e) and (g)  
    Line 5  
    Line 7  
    Line 8a, columns (d) and (e)  
    Lines 8b - 10, columns (d), (e) and (g)  
    Line 12  
    Line 13  
    Line 15  
    Line 18  
    Line 19  

  2. For additional instructions, see IRM 3.11.3.

Form 8949 (Sequence 12A) - Sales and Other Dispositions of Capital Assets

  1. The following lines on Form 8949 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Entries with "Z" Code: There are no T-Compute Lines
    Part I, col a  
    Part I, col b  
    Part I, col g  
    Part I indicator, edited to the right of Part I, col h  
    Part II, col a  
    Part II, col b  
    Part II, col g  
    Part II indicator, edited to the right of Part II, col h  
    Entries with "Y" Code (TY20 and later):  
    Part I, col a  
    Part I, col b  
    Part I, col g  
    Part I indicator, edited to the right of Part I, col h  
    Part II, col a  
    Part II, col b  
    Part II, col g  
    Part II indicator, edited to the right of Part II, col h  

  2. For complete instructions, see IRM 3.11.3.

Schedule E (Sequence 13) - Supplemental Income and Loss

  1. The following lines on Schedule E are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Checkboxes A and B Lines 23a through 23e
    Line 14, columns (a) - (c) Lines 24 and 25
    Lines 23a through 23e Line 29a, column (h) and column (k)
    Lines 24 and 25 Line 29b, column (g) and column (i)
    Line 27, checkboxes Line 30
    Line 29a, column (h) and column (k) Line 31
    Line 29b, column (g) and column (i) Line 35
    Line 30 Line 36
    Line 31 Line 39
    Line 34a, column (d)  
    Line 34b, column (c)  
    Line 35  
    Line 36  
    Line 37 - edited to the left of line 37  
    Line 39  
    Line 40  
    Line 42  
    Line 43  

  2. For additional instructions, see IRM 3.11.3.

Schedule F (Sequence 14, 15) - Profit or Loss from Farming

  1. The following lines on Schedule F are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Lines B, D, F and G Line 9
    Line 1b Line 33
    Line 2 Line 44
    Lines 3a and 3b Line 50
    Lines 4a and 4b  
    Line 5b  
    Lines 6a and 6b  
    Line 7  
    Line 9  
    Line 13  
    Lines 19, 21a, 25, 28 and 33  
    Line 36, "At Risk" Indicator (no editing required)  
    Lines 38a, 38b and 39a  
    Line 40b  
    Line 44  
    Line 50  

  2. If the taxpayer is a bona fide resident of PR and indicates Schedule F income is excluded under IRC 933, take the following actions:

    1. "X" the schedule

    2. Prepare a dummy schedule

    3. For Schedule F, edit $1 for Gross Income (line 9) and edit the NAICS code if furnished by the taxpayer.

  3. For additional instructions, see IRM 3.11.3.

Schedule R (Sequence 16) - Credit for the Elderly or Disabled

  1. The following lines on Schedule R are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Lines 1 through 9 Line 13c, Part III
    Line 11, Part III  
    Line 13c, Part III  

  2. For additional instructions, see IRM 3.11.3.

Schedule SE (Sequence 17, 18) - Self-Employment Tax

  1. The Schedule SE Section A ("short form" ) is valid for TY19 and prior only.

  2. The following lines on Schedule SE are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    TIN Line 3
    Lines 1a through 3 Line 8d
    SE Quarters Covered, - edited to the right of line 4c Line 26
    Line 5a  
    Line 8d  
    SE Farm Code - edited in the center-bottom margin of page 2  
    Line 26  

  3. For additional instructions, see IRM 3.11.3.

Form 1116 (Sequence 19) - Foreign Tax Credit

  1. The following lines on Form 1116 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    To the right of Part I Line 1a
    Line 1a Lines 6, 7 and 8
    Lines 6, 7 and 8 Line 14
    Line 14 Line 17
    Lines 16 and 17 Line 35
    Lines 21  
    Line 24  
    Lines 34 and 35  

  2. If the amount on line 1a, Form 1116, is the same as the amount reported on line 26, Form 2555 or line 17, Form 2555-EZ (TY18 and prior), then:

    1. Adjust line 1a, Form 1116 by subtracting the greater of line 42 or 45, Form 2555 or line 18, Form 2555-EZ (TY18 and prior) from line 1a, Form 1116. See Figure 3.21.3-9.

    2. If line 1a of Form 1116 is reduced to zero, "X" the amount on Schedule 3, line 1.

    Caution:

    If more than one Form 2555 or Form 2555-EZ (TY18 and prior) (both taxpayers can use either Form 2555 or Form 2555-EZ (TY18 and prior), or any combination) is attached, use the combined amounts for line 26, Form 2555 or line 17, Form 2555-EZ (TY18 and prior) to compare to line 1a.

  3. If the taxpayer's intent is not to use Form 1116 or if the taxpayer claims a negative or zero on line 35, Form 1116 "X" Form 1116.

  4. Taxpayers earning income in the following countries are not allowed to take a foreign tax credit for foreign taxes paid. If the taxpayer takes the foreign tax credit (see Form 1116, Part II, Line 8) with respect to taxes paid to any of the following countries (see Form 1116, Part I, letter i, column A, B, or C), "X" both line 8, Form 1116 and Schedule 3, line 1.

    Country Starting Date Ending Date
    Iran January 1, 1987 Still in Effect
    North Korea January 1, 1987 Still in Effect
    Sudan February 12, 1994 Still in Effect
    Syria January 1, 1987 Still in Effect

  5. For additional instructions refer to IRM 3.11.3.

    Exception:

    Do not refer to IRM 3.11.3 when Form 1116 has been deleted per IRM 3.21.3.29 (3) above.

    Figure 3.21.3-9

    This is an Image: 34010009.gif

    Please click here for the text description of the image.

Schedule J (Sequence 20) - Income Averaging for Farmers and Fishermen

  1. The following lines on Schedule J are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 2a There are no T-Compute Lines.
    Line 2b  
    Line 8  
    Line 12  
    Line 16  
    Line 19  
    Line 20  
    Line 21  

  2. For additional instructions, see IRM 3.11.3.

Form 2441 (Sequence 21) - Child and Dependent Care Expenses

  1. The following lines on Form 2441 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 1, column (a) Care Provider's Name Control Line 3
    Line 1, column (c) Care Provider's TIN  
    Line 2, Qualifying Persons (not edited)  
    Line 2, column (a) - Qualifying Person's Name Control  
    Line 2, column (b) - Qualifying Person's TIN  
    Line 2, column (c) - Qualified Expenses  
    Lines 3 through 5  
    Line 12  
    Line 16  
    Line 25  

  2. For additional instructions, see IRM 3.11.3.

Form 3800 (Sequence 22) - General Business Credit

  1. The following lines on Form 3800 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Lines 1 through 5 There are no T-Compute Lines.
    Line 24  
    Line 25  
    Line 26  
    Line 36  
    Part III, Checkbox I  
    Form 3468 Indicator - to the right of line 1a, column (c)  
    Line 1a, column (c)  
    Lines 1c through 1zz, column (c)  
    Line 3, column (c)  
    Line 4h, column (c)  
    Line 5, column (c)  
    Bottom right margin, page 3  

  2. For additional instructions, see IRM 3.11.3.

Form 4136 (Sequence 23) - Credit for Federal Tax Paid on Fuels

  1. The following lines on Form 4136 are T-Lines and T-Compute Lines (all amounts are understood to be in column (d)):

    T-Lines T-Compute Lines
    Lines 1 through 16, column (d) There are no T-Compute Lines.

  2. For additional instructions, see IRM 3.11.3.

Form 4137 (Sequence 24, 25) - Social Security and Medicare Tax on Unreported Tip Income

  1. The following lines on Form 4137 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Taxpayer TIN Line 2
    Lines 1A through 1E, columns (a) through (d)  
    Lines 2 and 3  
    Line 5  
    Line 6  
    Line 8  

  2. For additional instructions, see IRM 3.11.3.

Form 4684 (Sequence 26) - Casualties and Thefts

  1. The following lines on Form 4684 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    FEMA Disaster Declaration Number Line 13
    Line 1, Property A ZIP Code Line 14
    Line 13 Line 16
    Line 14  
    Line 16  

  2. For additional instructions, see IRM 3.11.3.

Form 4797 (Sequence 27) - Sale of Business Property

  1. The following lines on Form 4797 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 1 Line 9
    Line 7  
    Line 8  
    Line 9  
    Bottom Center Margin  

  2. For additional instructions, see IRM 3.11.3.

Form 4972 (Sequence 28) - Tax on Lump Sum Distributions

  1. The following lines on Form 4972 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Lines 1 through 5b Line 12
    Line 6  
    Lines 11 and 12  
    Line 18  
    Line 30  

  2. For additional instructions, see IRM 3.11.3.

Form 5329 (Sequence 29, 30) - Additional Taxes On Qualified Plans (including IRAs) and other Tax-Favored Accounts

  1. The following lines on Form 5329 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Spousal Indicator - edited to the left of the form title Line 4
    Loose form indicator - edited to the right of the entity area Line 8
    Line 4 Line 55
    Line 8  
    Line 17  
    Line 25  
    Line 33  
    Line 41  
    Line 49  
    Line 51  
    Line 55  
    Bottom-right margin, IRA Condition Code  

  2. For additional instructions, see IRM 3.11.3.

Form 6198 (Sequence 31) - At-Risk Limitations

  1. The following lines on Form 6198 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 5 Line 5
    Lines 20 and 21  

  2. For additional instructions, see IRM 3.11.3.

Form 6251 (Sequence 32) - Alternative Minimum Tax - Individuals

  1. The following lines on Form 6251 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Line 2c through 3 There are no T-Compute Lines.
    Line 8  

  2. For additional instructions, see IRM 3.11.3.

Form 8615 (Sequence 33) - Tax for Certain Children Who Have Unearned Income

  1. The following lines on Form 8615 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Lines A and B There are no T-Compute Lines.
    Lines 1 and 2  
    Line 18  

  2. For additional instructions, see IRM 3.11.3.

Form 2555 and Form 2555-EZ (Sequence 34, 35) - Foreign Earned Income Exclusion

  1. Form 2555-EZ is valid for TY18 and prior only.

  2. The following lines on Form 2555 are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Post of Duty (POD) Code - Top Center Margin Line 22g (Total Allowances)
    Line 10 (Beginning Date - Bona Fide Residence) Line 33 (Housing Expense)
    Line 10 (Ending Date - Bona Fide Residence) Line 42 (Foreign Earned Income Exclusion)
    Line 13a (Declaration Questions - Right Margin) Line 50 (Housing Deduction)
    Line 14 (Number of Days in U.S. on Business - Right Margin just above 15a)  
    Line 16 (Beginning Date - Physical Presence)  
    Line 16 (Ending Date - Physical Presence)  
    Line 18 (Number of Days in U.S. on Business - Right Margin)  
    Line 19 (Form 2555 Wages)  
    Line 22g (Total Allowances)  
    Line 25 (Meals and Lodging)  
    Line 33 (Housing Expenses)  
    Line 36 (Housing Exclusion)  
    Line 42 (Foreign Earned Income Exclusion)  
    Line 45 (Housing Exclusion, Foreign Earned Income Exclusion, or Both)  
    Line 50 (Housing Deduction)  

  3. For TY18: The following lines on Form 2555-EZ are T-Lines and T-Compute Lines:

    T-Lines T-Compute Lines
    Post of Duty (POD) Code - Top Center Margin Line 18
    Line 1b (Beginning and Ending Dates - Bona Fide Residence)  
    Line 2b (Beginning and Ending Dates - Physical Presence)  
    Line 12 (Number of Days in U.S. on Business - Right Margin just above Part IV)  
    Line 17 (Wages)  
    Line 18 (Foreign Earned Income Exclusion)  

General Information for Form 2555 and Form 2555-EZ

  1. U.S. citizens or resident aliens of the United States living abroad are taxed on worldwide income and may qualify to exclude from income up to $107,600 for tax year 2020 (per IRC 911 (d)(2)(4)) of their foreign earnings. In addition, they can exclude or deduct certain foreign housing amounts.

  2. To claim the foreign earned income exclusion, the foreign housing exclusion, or foreign housing deduction, the taxpayer must satisfy all three of the following requirements:

    • The tax home must be in a foreign country

    • The taxpayer must have foreign earned income

    • The taxpayer must be one of the following:

    A U.S. Citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes any tax year in its entirety and includes part of the tax year of the return.

    Note:

    An entire tax year is from January 1 through December 31 for taxpayers who file their income tax returns on a calendar year basis.

    A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect that has a nondiscrimination clause and who is a bona fide resident for an uninterrupted period that includes an entire tax year and includes part of the tax year of the return.
    A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months and includes part of the tax year of the return.

  3. If the tax home on Form 2555 and Form 2555-EZ (TY18 and prior) is in a foreign country, the taxpayer is entitled to the IRC 911 exclusion even if the address on the Form 1040 is an address in the U.S. or in a U.S. territory.

  4. Taxpayers claiming a foreign earned income exclusion are not entitled to claim the same amount on line 1a, Form 1116. See IRM 3.21.3.29 for processing instructions.

  5. Form 2555-EZ is valid for TY18 and prior only.

General Editing Instructions for Form 2555 and Form 2555-EZ

  1. Use the following table for general editing instructions for Form 2555 and Form 2555-EZ:

    Reminder:

    Form 2555-EZ is valid for TY18 and prior only.

    If And Then
    Taxpayer claims unearned income, including any of the following:
    • Alimony

    • Annuities

    • Capital gains

    • Dividends

    • Gambling Winnings

    • Interest

    • Pensions

    • Retirement

    • Social Security Benefits

    • Unemployment Benefits

    Earned income is also claimed
    1. Adjust Schedule 1, line 8 to only exclude the earned income

    2. "X" the amount on lines 42 and/or 45, Form 2555 or Line 18, Form 2555-EZ (TY18 and prior)

    Taxpayer claims unearned income, including any of the following:
    • Alimony

    • Annuities

    • Capital gains

    • Dividends

    • Gambling Winnings

    • Interest

    • Pensions

    • Retirement

    • Social Security Benefits

    • Unemployment Benefits

    No earned income is included
    1. "X" Schedule 1, line 8

    2. "X" Form 2555 or Form 2555-EZ

    3. "X" the dotted portion of Schedule 1, line 22

    4. Ensure foreign earned income is reported on the appropriate line(s) 1 through 7 of Form 1040 or Schedule 1, line(s) 1 through 8

    Reminder:

    If the deleted Form 2555 and/or Form 2555-EZ is the only foreign aspect of the return, rebatch the coded return as domestic.

    The taxpayer claims self-employment income from Schedule C or Schedule F
    • Reports a net amount on Schedule 1, line 3 or Schedule 1, line 6, and

    • Claims an exclusion for the gross amount on Schedule 1, line 8

    Adjust Schedule 1, line 8 to only exclude the net amount.
    Taxpayer:
    1. U.S. Military or

    2. Lives and works in a U.S. territory or

    3. Resides in:

      • Baker Island

      • Howland Island

      • Jarvis Island

      • Johnston Atoll

      • Kingman Reef

      • Midway Islands

      • Palmyra Atoll

      • Wake Islands

     
    1. "X" Schedule 1, line 8

    2. "X" the dotted portion of Schedule 1, line 22

    3. "X" Form 2555 or Form 2555-EZ (TY18 and prior)

    4. Ensure foreign earned income is reported on the appropriate line(s) 1 through 7 of Form 1040 or Schedule 1, line(s) 1 through 8

    Exception:

    If a return shows income earned in the Federated States of Micronesia, Marshall Islands or Palau Islands and Form 2555 or Form 2555-EZ (TY 2018 and prior) is attached and valid, ALLOW the exclusion.

    Reminder:

    If the deleted Form 2555 and/or Form 2555-EZ is the only foreign aspect of the return, rebatch the coded return as domestic.

    Taxpayer makes no attempt to exclude income on Form 1040 or Schedule 1 Form 2555 or Form 2555-EZ (TY18 and prior) does not include a claim for excluded income "X" Form 2555 or Form 2555-EZ (TY18 and prior)
    Multiple Forms 2555 and/or Form 2555-EZ are attached for 1 Taxpayer  
    • Combine related T-lines

    • "X" the other Form(s) 2555 or Form 2555-EZ

    • Use the appropriate POD code for the Form 2555 or Form 2555-EZ with the most income on Line 26, Form 2555 or Line 17, Form 2555-EZ

    • Edit dates to include the entire period reported on forms.

    • When combining Form(s) 2555 with Form(s) 2555-EZ, always combine onto Form 2555. Combine line 17, Form 2555-EZ with line 19, Form 2555, and line 18, Form 2555-EZ with lines 42 and 45, Form 2555.

    Note:

    Correspond for Form 2555 when combined foreign earned income from Forms 2555-EZ (TY18 and prior) is over the maximum for the year. For TY20, the maximum is $107,600.

    Taxpayer enters beginning and ending dates that do not include part of the tax year of the return.   Correspond
    • If using Form 9143, check box 14.

    • If using Form 13900, use the following literal:
      "To exclude foreign income, the qualifying dates on Form 2555 or Form 2555-EZ must cover a part of the tax year of your tax return. Please verify your beginning and/or ending dates, and re-submit your Form 2555."

  2. If Form 2555 or Form 2555-EZ (TY18 and prior) is valid:

    • ensure all foreign-sourced income is included on line 1 of Form 1040 or Schedule 1, lines 3, 5, and/or 6 and

    • the exclusion is a negative on Schedule 1, line 8

  3. If the Form 2555 or Form 2555-EZ (TY18 and prior) is invalid:

    • ensure all foreign-sourced income is included on line 1, of Form 1040 or Schedule 1 lines 3, 5, and/or 6 and

    • "X" Schedule 1, line 8

    • "X" Form 2555 or Form 2555-EZ

    • If the deleted Form 2555 or Form 2555-EZ (TY18 and prior) is the only foreign aspect of the return, rebatch the coded return as domestic.

Form 2555 for Joint Filers

  1. Only two (2) forms can be processed:

    • One for the primary taxpayer (sequence code 34)

    • One for the secondary taxpayer (sequence code 35)

    Note:

    For TY18 and prior, Taxpayers can use Form 2555 or Form 2555-EZ in any combination. For TY19 and later, any valid Form 2555-EZ is converted to Form 2555.

  2. If a Form 2555 or Form 2555-EZ is for the secondary taxpayer, edit Sequence Code "35" .

  3. If two (2) Forms are submitted and only one is valid:

    1. Adjust Schedule 1, line 8 by deleting the amount for the invalid Form 2555 or Form 2555-EZ, if applicable.

    2. Adjust Schedule 1, line 22 dotted portion by deleting the amount for the invalid Form 2555 or Form 2555-EZ, if applicable.

    3. "X" the invalid Form 2555 or Form 2555-EZ.

    4. Make sure foreign earned income is reported on the appropriate line.

  4. If two (2) Forms are submitted and neither one is valid:

    1. "X" Schedule 1, line 8 (foreign earned income exclusion).

    2. "X" Schedule 1, line 22 (dotted portion - foreign earned housing deduction).

    3. "X" both Forms 2555 or Form 2555-EZ.

    4. Make sure foreign earned income is reported on the appropriate line 1 through 7 of Form 1040 or Schedule 1, line(s) 1 through 8.

    5. If the deleted Form 2555 and/or Form 2555-EZ (TY18 and prior) is the only foreign aspect of the return, rebatch as domestic.

  5. If only one Form 2555 or Form 2555-EZ is submitted for both taxpayers, correspond for separate Form(s) 2555 or Form 2555-EZ (TY18 and prior), see Figure 3.21.3-10.

    Caution:

    If the spouses are a missionary team, see IRM 3.21.3.42.3 (6).

  6. If the spouses are a missionary team and only one Form 2555 or Form 2555-EZ is submitted, DO NOT correspond. Divide the income equally between the two filers on separate Form(s) 2555 or Form 2555-EZ (TY18 and prior).

    Exception:

    If it can be determined that the income was earned by only one spouse, DO NOT divide the income. Process the Form 2555 or Form 2555-EZ as filed.

    Figure 3.21.3-10

    This is an Image: 34010010.gif

    Please click here for the text description of the image.

Post of Duty (POD) Code

  1. A POD Code must be edited to all Forms 2555 or Form 2555-EZ (TY18 and prior).

  2. Edit the appropriate 2 alpha character POD Code in the top center margin of Page 1, Form 2555 or Form 2555-EZ according to Exhibit 3.21.3-7. See Figure 3.21.3-11.

    Figure 3.21.3-11

    This is an Image: 34010011.gif

    Please click here for the text description of the image.

  3. Examine Form 2555 or Form 2555-EZ to determine where the foreign income was earned. Use the following priority order when determining the POD assignment:

    1. Address: line 1, Form 2555; line 4, Form 2555-EZ

    2. Tax Home: line 9, Form 2555; line 11a, Form 2555-EZ

    3. Principal Country: line 17, Form 2555

    4. Foreign address on Form 1040

    5. Employer’s foreign address: line 4b, Form 2555: line 8, Form 2555-EZ

    6. Income Statement

    Note:

    If multiple countries are present, edit the first with a listed POD.

    Reminder:

    If combining Forms 2555 or Form 2555-EZ (TY18 and prior), edit the POD for the Form 2555 or Form 2555-EZ with the most income on line 26, Form 2555 or line 17, Form 2555-EZ.

  4. If the country in which the foreign income is earned is not listed in the POD Table, edit POD Code "XX."

  5. If you cannot determine the POD after using instructions in IRM 3.21.3.42.4 (3) above, edit POD Code "XX."

Determining Bona Fide Residence and Physical Presence Dates

  1. A U.S. citizen is considered a Bona Fide resident of a foreign country if his tax home has been in that foreign country for an uninterrupted period of time which includes a full calendar year and part of the tax year of the return. Before editing bona fide dates for restricted countries (Cuba, Iraq and Libya), see IRM 3.21.3.42.5 (3).

    Note:

    Waiver of minimum time requirements - the minimum time requirements for bona fide residence can be waived if the taxpayer must leave a foreign country because of war, civil unrest, or similar adverse conditions in that country. The following are the only countries that can claim a waiver for 2020.

    Country Date of Departure on or after
    People's Republic of China, excluding the Special Administrative Regions of Hong Kong and Macau (China) December 1, 2019 and before July 15, 2020

    Note:

    Edit dates to cover a full calendar year using the dates provided by the taxpayer if available. Otherwise, use the tax year of the return to determine the applicable dates.

  2. To qualify for bona fide residence, the taxpayer must reside in a foreign country for an uninterrupted period that includes an entire tax year and includes part of the tax year of the return.

    Note:

    An entire tax year is from January 1 through December 31 for taxpayers who file their income tax returns on a calendar year basis.

    Example:

    For TY20, the taxpayer enters bona fide dates of 11/01/2018 to 01/15/2021. The taxpayer completed an uninterrupted period of residence for a full tax year (2020) and therefore meets the bona fide residence test. The taxpayer would also qualify for tax years 2018, 2019, and 2021.

    Example:

    For TY20, the taxpayer enters bona fide dates of 10/01/2019 to 11/30/2020. The taxpayer did not complete an uninterrupted period of residence for a full tax year (2019 or 2020) and therefore does not meet the bona fide residence test in either year, but qualifies for physical presence.

  3. A taxpayer living and working in a restricted country cannot claim the benefits under "IRC 911:"

    Caution:

    If the taxpayer meets either bona fide or physical presence but the beginning date was within the restricted period, edit qualifying dates based on the end of the restriction.

    Restricted Country Beginning Date Ending Date
    Cuba

    Exception:

    If a nonmilitary taxpayer files a Form 1040 with a Form 2555 exclusion from United States Naval base at Guantanamo Bay, allow the exclusion.

    January 1, 1987 Still in effect
    Iraq August 2, 1990 July 29, 2004
    Libya January 1, 1987 September 20, 2004

  4. Edit Beginning and Ending Dates in YYMM format for bona fide residence dates:

    • Form 2555 - Part II line 10 area

    • Form 2555-EZ (TY18 and prior) - Part I, below line 1b

    Exception:

    If the beginning date is 1950 or earlier, then perfect the date in a YYYYMM format. (Example: September 1947 will be edited as "194709" ).

  5. Edit Beginning and Ending Dates in YYMM format for physical presence dates:

    • Form 2555 - Part III line 16 area

    • Form 2555-EZ (TY18 and prior) - Part I, below 2b

    Exception:

    If the beginning date is 1950 or earlier, then perfect the date in a YYYYMM format. (Example: September 1947 will be edited as "194709" ).

  6. On a TY19 or TY20 return, if the dates are either missing or the dates don't qualify for either bona fide or physical presence test, and one or more of the following notations is present;

    • Revenue Procedure 2020-27

    • Adverse conditions

    • Could not meet 330 days test due to emergency (for example: medical condition or travel restrictions)

    Allow the foreign earned income exclusion and edit the physical presence test dates provided. If dates are missing, edit dates for the calendar year (2001 and 2012).

  7. If both beginning and ending dates are present or can be determined, follow the tables below. (To determine dates, see IRM 3.21.3.42.5 (8).)

    If And Then
    Entries are present only for Bona Fide Residence Dates
    • The dates cover any full calendar year, and

    • The dates include part of the current tax year

    Edit the dates in YYMM format in the Bona Fide Residence section.

    Example:

    If the taxpayer indicates the beginning date as January, 2020 and the ending date as December, 2020, edit "2001" as the beginning date and "2012" as the ending date.


    See Figure 3.21.3-12.
    Entries are present only for Bona Fide Residence Dates
    • The dates do not cover any full calendar year, but

    • The dates cover at least 330 days

    Edit the dates in YYMM format in the Physical Presence section. See Figure 3.21.3-13.
    Entries are present only for Bona Fide Residence Dates The dates are less than 330 days (unless IRM 3.21.3.42.5 (6) applies)
    1. "X" the foreign earned income exclusion amount on Schedule 1, line 8.

    2. "X" the foreign housing deduction on the dotted portion of Schedule 1, line 22

    3. "X" Form 2555 or Form 2555-EZ

    4. If the deleted Form 2555 or Form 2555-EZ is the only foreign aspect of the return, rebatch as domestic.

    Entries are present only for Physical Presence Dates The dates cover at least 330 days Edit the dates in YYMM format in the Physical Presence section
    Entries are present only for Physical Presence Dates The dates do not cover at least 330 days (unless IRM 3.21.3.42.5 (6) applies)
    1. "X" the foreign earned income exclusion amount on Schedule 1, line 8.

    2. "X" the foreign housing deduction on the dotted portion of Schedule 1, line 22

    3. "X" Form 2555 or Form 2555-EZ

    4. If the deleted Form 2555 or Form 2555-EZ is the only foreign aspect of the return, rebatch as domestic.

    Entries are present for both Bona Fide Residence and Physical Presence Dates
    • The dates are different

    • Both dates meet the criteria for their test

    Edit the dates for the longest period in the appropriate section. See Figure 3.21.3-14
    Entries are present for both Bona Fide Residence and Physical Presence Dates
    • The dates are the same, and

    • Both dates meet the criteria for their test

    Edit Bona Fide Residence Dates. See Figure 3.21.3-15.
    Entries are present for both Bona Fide Residence and Physical Presence Dates Only one set of dates meets the criteria for their test. Edit the date which meets the criteria for the test.
    Entries are present for both Bona Fide Residence and Physical Presence Dates The dates do not qualify for either Bona Fide Residence or Physical Presence (unless IRM 3.21.3.42.5 (6) applies)
    1. "X" the foreign earned income exclusion amount on Schedule 1, line 8.

    2. "X" the foreign housing deduction on the dotted portion of Schedule 1, line 22

    3. "X" Form 2555 or Form 2555-EZ

    4. If the deleted Form 2555 or Form 2555-EZ is the only foreign aspect of the return, rebatch as domestic.

    Caution:

    If the taxpayer enters an ending date beyond the received date of the return, edit the received date as the ending date (e.g., if the taxpayer’s ending date is June 1, 2021 and the return received date is April 25, 2021, then edit the ending date as "2104" ).

    Figure 3.21.3-12

    This is an Image: 34010012.gif

    Please click here for the text description of the image.

    Figure 3.21.3-13

    This is an Image: 34010013.gif

    Please click here for the text description of the image.

    Figure 3.21.3-14

    This is an Image: 34010014.gif

    Please click here for the text description of the image.

    Figure 3.21.3-15

    This is an Image: 34010015.gif

    Please click here for the text description of the image.

  8. If beginning and/or ending dates are not present:

    If And Then
    The taxpayer indicates the tax home in the country is for a full calendar year by including notations as:
    • "since birth"

    • "all my life"

    • "still here"

    • "continues"

    • "N/A"

    • "-"

    Reminder:

    These notations are not all inclusive

     
    1. If the beginning date is unknown, edit January of the tax year as the beginning date. (for example, for a TY20 return, edit "2001." ) See Figure 3.21.3-16.

    2. If the ending date is unknown on a current year return:

      • Edit the current date if until "042221"

      • Edit the received date. (for example, if the received date is June 2021, edit "2106" )

      • Edit CCC "N" on a late-filed return when the ending date is after the tax period of the return.

      See Figure 3.21.3-17.

    3. If the ending date is unknown on a prior year return, edit the received date as the ending date.

    Reminder:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡" .

    Any of the following conditions are present:
    • No beginning date (ending date is present)

    • No ending date (beginning date is present)

    • No dates

    • Only months are present (e.g., Jan. - Dec.)

    The number of days on line 31 or 38, Form 2555 (line 14, Form 2555-EZ) is 365 or 366 Edit qualifying Bona Fide dates to cover a full calendar year see Figure 3.21.3-18.

    Note:

    If the beginning date is unknown, edit January and if the ending date is unknown, edit December.

    Any of the following conditions are present:
    • No beginning date (ending date is present)

    • No ending date (beginning date is present)

    • No dates

    • Only months are present (e.g., Jan. - Dec.)

    The number of days on line 31 or 38, Form 2555 (line 14, Form 2555-EZ) is 330-364 Edit qualifying Physical Presence Dates to cover a full calendar year, see Figure 3.21.3-19.

    Note:

    If the beginning date is unknown, edit January and if the ending date is unknown, edit December.

    Any of the following conditions are present:
    • No beginning date (ending date is present)

    • No ending date (beginning date is present)

    • No dates

    • Only months are present (e.g., Jan. - Dec.)

    The number of days on line 31 or 38, Form 2555 (line 14, Form 2555-EZ) is less than 330 (unless IRM 3.21.3.42.5 (6) applies) Correspond.

    Note:

    Do not "X" the exclusion (Form 2555 or Form 2555-EZ (TY18 and prior) based on the number of days being less than 330 days before corresponding with the taxpayer.

    Only a year is provided:
    1. Beginning date

    2. Ending date

     
    1. Edit the beginning date as YY01

    2. Edit the ending date as YY12

    Figure 3.21.3-14

    Figure 3.21.3-16

    This is an Image: 34010016.gif

    Please click here for the text description of the image.

    Figure 3.21.3-17

    This is an Image: 34010017.gif

    Please click here for the text description of the image.

    Figure 3.21.3-18

    This is an Image: 34010018.gif

    Please click here for the text description of the image.

    Figure 3.21.3-19

    This is an Image: 34010019.gif

    Please click here for the text description of the image.

Form 2555 - Page 1, Parts I and II

  1. If Page 1 is missing, correspond.

    Exception:

    If page 2 is complete, including physical presence dates, and page 1 is missing, dummy page 1 of Form 2555. If Part III is complete, do not correspond for Part II.

  2. POD Code (top center of Form 2555): see IRM 3.21.3.42.4 and Exhibit 3.21.3-7. If the country cannot be determined, edit POD "XX."

  3. Bona Fide residence dates, Line 10: see IRM 3.21.3.42.5.

  4. Declaration Questions: Edit a “4” in the margin to the right of line 13a if any of the following conditions are found. See Figure 3.21.3-20.

    1. Line 13(a): YES box checked

    2. Line 13(b): NO box checked

    3. Line 15(c): YES box checked

    4. Line 15(d): YES box checked

    Caution:

    Do not edit "4" for declaration questions if dates are being moved from bona fide residence to physical presence or if the only dates present are physical presence dates.

  5. Line 14 columns (c): Days in the United States on business:

    1. "Number of days in U.S. on business" (third and seventh columns under line 14): Add the number of days listed. See Figure 3.21.3-20.

      Exception:

      Do not include days in the U.S. due to illness, personal or vacation.

    2. Edit the sum in the margin to the right of line 14 and just above line 15a, see Figure 3.21.3-20.

    Note:

    If dates are being moved from bona fide residence to physical presence, also move number of days in the U.S. on business, if present. If only physical presence dates are present, move the number of days entered by the taxpayer from page 1 to page 2.

    Figure 3.21.3-20

    This is an Image: 34010020.gif

    Please click here for the text description of the image.

Form 2555 - Page 2, Part III

  1. Physical Presence Dates, Line 16: see IRM 3.21.3.42.5.

  2. Line 18 column (e) - Days in the United States on Business:

    1. "Number of days in U.S. on business" (fifth column under line 18): Add the number of days listed.

      Exception:

      Do not include days in the U.S. due to illness, personal or vacation.

    2. Edit the sum in the margin to the right of line 18 and just above the Part IV.

    3. If Line 18 column (e) is blank and only Physical Presence dates are present, edit number of days in U.S. on business from line 14c.

Form 2555 - Page 2, Part IV

  1. Page 2 of Form 2555 must