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4.19.3  IMF Automated Underreporter Program (Cont. 7)

4.19.3.21  (02-12-2016)
CP 2000 Notice Review

  1. A statistically valid sample of cases is produced for review. This is a product review toward perfecting the quality of notices. In the review, the case is reworked from the beginning, including the determination of the U/R amount.

  2. The selection of sample notices is performed from all CP 2000 Notice runs with the exception of cases with Sort Codes, Employee AUR cases, and CP 2000s posted after CP 2501 Notices. Employee AUR cases continue to be processed in accordance with IRM 4.19.3.23, Employee Cases.

  3. The reviewer will review all the sampled cases. The case file is built into BT 95.

  4. The tax examiner verifies the CP 2000 for correctness and overall quality by reworking the case.

  5. If no error is found, no action is necessary.

  6. If an error is found, and the CP 2000 Notice needs to be corrected, the reviewer must stop the original CP 2000 by either transferring the case(s) or using the Stop Notice window, as applicable and:

    Caution:

    When a non-critical error is discovered (See Exhibit 4.19.3-11, Notice Review Error Codes), determine on a case-by-case basis whether the error will hamper the TP’s ability to understand the notice. Only stop the notice if it is determined that the error will cause the TP difficulties in understanding the issues on the notice.

    If Then
    A notice still needs to be issued. Issue a corrected notice.

    Note:

    If the CP 2000 cannot be stopped, send PARAGRAPH 88. See Exhibit 4.19.3-7, CP PARAGRAPHS.

    The case should be closed Use the applicable closing PC.

    Note:

    If the CP 2000 cannot be stopped, close with PC 71. Issue a Letter 1802C apologizing for the incorrect notice.

    When the SSN is entered on the Stop Notice window, the system automatically assigns the appropriate "not mailed" PC. If it is subsequently necessary to remove the SSN from Stop Notice the following message displays "Transfer case to the AUR Coordinator. Process code needs to be deleted" .

  7. Provide results for the specified review of CP 2000 Notices to Headquarters on a weekly basis.

    1. Submit information only on those cases that are found in error.

    2. Use the appropriate error codes.

      Note:

      "Critical" errors affect the total balance due. "Noncritical" errors DO NOT affect the total balance due.

  8. If the critical error rate exceeds 10 percent, do the following:

    1. Decide on a plan of corrective action.

    2. Within 2 days of determining that the "Critical" error rate exceeds 10 percent advise Headquarters of the error rate and describe the corrective action(s) for concurrence.

    See Exhibit 4.19.3-11, Notice Review Error Codes.

4.19.3.22  (09-01-2008)
Accounts Maintenance Research (AMRH) Transcripts 25 and 27

  1. An AMRH transcript 25 or 27 generates for an unsettled AUR case module as an alert that an action (closure, assessment, etc.) needs to take place to resolve a TP's account.

4.19.3.22.1  (09-01-2013)
Overview of AMRH Transcripts

  1. The AMRH transcripts generate to identify over aged freezes and unsettled conditions that failed to be resolved following normal procedures and processing as a result of oversight, procedural shortcomings, systemic issues, etc.

    Caution:

    IT IS CRITICAL TO WORK THESE TRANSCRIPTS TIMELY - WITHIN 120 DAYS - AND COMPLETELY TO RESOLVE A CASE BEFORE THE ASSESSMENT STATUTE DATE EXPIRES.

  2. The AMRH transcripts with TC 922 (IRP/AUR) posted are transferred or forwarded to AUR to identify unresolved accounts that were not closed within a certain length of time. For any additional specific instructions, refer to IRM 21.2.4, Master File Accounts Maintenance, or IRM 25.6, Statute of Limitations, which contains instructions to transfer AMRH transcripts with TC 922 in module(s) to AUR for processing.

  3. An unresolved TC 922 condition exists when:

    1. There is a credit balance (surplus) on the module. This condition creates the AMRH25 (25R) transcript. A credit balance may be caused by a variety of conditions (i.e., an unreversed TC 640, Advance Payment of Determined Deficiency on AUR Proposal, erroneous no change closure, etc.).

      Caution:

      Do not release any credit balance when a TC 971 AC 134 is present, with or without a corresponding TC 720 which sets a P- freeze condition, or when the case was closed with PC 10.

    2. A closing PC is not present on the module or does not post as the last PC in the TC 922 string. This condition creates the AMRH27 (27F) transcript. A closing PC may be missing for a number of reasons (i.e., a CP 2000 or subsequent notice was generated and no follow-up or closing action was taken, or a closing PC may have posted the cycle after the transcript was generated, etc.)

    3. An AMRH 27 transcript is also created when a closing assessment PC is posted, but an adjustment in the AUR blocking series is not on the account.

  4. AMRH transcripts for 25R/27F are routed directly to the AUR by Information Systems. AUR must handle these transcripts to completion.

  5. Take the necessary action to review the following conditions:

    • The AUR issue is resolved.

    • All appropriate closing PCs are in the last position of the TC 922 string.

    • Required adjustments are posted in an AUR blocking series.

    • There is no credit balance.

    • No freeze codes are present.

    • No systemic or programming problems exist.

  6. If all of the conditions in (5) above exist, discard the transcript.

  7. For any case where there is no longer an AUR issue, but there is a freeze code present that cannot be resolved by AUR, direct the transcript back to the appropriate area.

4.19.3.22.2  (02-12-2015)
General Procedures

  1. Review AMRH transcripts to determine the last PC reflected on the TC 922.

  2. If the tax module on IDRS reflects a TC 922 without PCs, research CC IMFOLT or Control D for MFTRA.

  3. For instructions regarding AMRH25 and AMRH27 transcripts and required procedures for specific PCs, see IRM 4.19.3.22.2.1, AMRH 25R Transcripts, and IRM 4.19.3.22.2.2, AMRH 27F Transcripts.

  4. When reviewing AMRH25 or AMRH27 transcripts, be alert for cases open on AIMS (Source Code 14 or 85). If open on AIMS, secure the original return and take the following action:

    Exception:

    Do not follow these procedures if there is a PC 80 or TC 520 present on the module.

    1. Rework the case to determine if an assessment is necessary.

      Note:

      The assessment must be input before transferring the case.

    2. Close the case with PC 27, 51, 73, or 93 as appropriate.

    3. Route the case to Examination.

  5. Review AUR and IDRS to determine the actions needed to resolve the account. In most situations the return is not necessary. The transcript can be used as the source document for many adjustments. If an adjustment is necessary using and AUR blocking series AND the return is not needed then:

    1. Complete Form 2275, Records Request, Charge and Recharge, if a paper return was filed, to associate the original return to the assessment DLN.

    2. Form 4251 can be used as the source document, if an ELF return was filed. Make the following notation, "Original return was filed electronically" or similar wording.

      Note:

      Ensure all closing actions have been taken on AUR. After the necessary actions to resolve the account have been taken, close all related control bases.

  6. If the case is open and currently being processed, take the following actions:

    1. Discard the transcript in accordance with local classified waste procedures.

    2. Close all related control bases on IDRS.

    Exception:

    If the ASED is imminent, ensure that all required adjustments and actions are completed before the statute expires.

  7. If a "No Change" PC has unposted or has posted out of sequence, input a TC 290-0 in an AUR blocking series to resolve the account.

  8. If a required adjustment has unposted or did not post to an account and there are more than 90 days before the statute expiration date, input the adjustment using an AUR blocking series.

    1. If less than 90 days remain until the ASED, prepare the case for adjustment and route to the RACS Function for input.

    2. If the assessment went unpostable because the account had been resequenced, reinput the assessment on the new (resequenced) account. DO NOT issue a second, manual notice on any cases with a resequenced SSN.

  9. If a required adjustment has unposted or did not post to an account and the statute has expired, prepare for processing as a barred assessment by completing Form 3999, Statute Expiration Report for their function, and email the completed Form to HQ within 7 days of discovery via the *SBSE CCS Statutes mailbox. The *SBSE CCS Statutes mailbox was established as a vehicle to report all potential and/or final barred statute reports.

    Note:

    After statute processing it may be necessary to input a TC 290-0 using an AUR blocking series to clear the account.

  10. If a TC 640 payment needs to be released, input a TC 290-0 adjustment using an AUR blocking series.

    Exception:

    If the case was closed in error (i.e. TP recomputed the amount of tax owed) and there is remittance, input the adjustment using an AUR blocking series.

  11. Bankruptcy, Innocent Spouse, MFT 31 and merged accounts may require additional research. Take all necessary actions to ensure that all related accounts and issues are resolved.

  12. If a TC 780 (OIC) has posted to the account, discard the transcript (in accordance with local classified waste procedures) and close all AUR and/or transcript control bases.

    Note:

    An adjustment with an AUR blocking series will not post to these accounts.

  13. If the AMRH transcript reflects TC 922 with a DLN for another Campus forward the AMRH transcript immediately to the attention of the Chief, AUR Operations for that Campus if more than 90 days remain on the assessment period.

    Note:

    If less than 90 days remain until the ASED, prepare the case for adjustment and route to the Statute RACS Function for input.

  14. If the return was timely filed (not on extension) the case is statute imminent on April 15th of the Statute year. However, if a Statutory Notice of Deficiency was issued on an AUR case, the assessment period is suspended and AUR can work the case past April 15th. A Statutory Notice of Deficiency increases the assessment period for the number of days from the date of the letter/notice until the TP responds with an agreement, PLUS the 60 days mandated by the Internal Revenue Code.

  15. To compute the ASED on cases where the TP's signed agreement is received prior to the expiration of the 90 days:

    1. Determine the original ASED (using the Julian Date).

    2. Determine the number of days from the date of the Statutory Notice to the TP reply date. Add this to the result from step 1.

    3. Add ≡ ≡ ≡ ≡ ≡ ≡ processing days.

      Note:

      The general rule for disagreed or defaulted cases is to ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ to the normal statute date if the return is filed timely. This determines the TP's new ASED.

    Caution:

    An assessment CANNOT be made on IDRS within 60 days of the ASED.

  16. A TC 560 MUST be input on IDRS by April 15th to EXTEND the ASED before any assessment can be made. If TC 560 was not input to extend the ASED, follow the instructions on Form 2859, Request for Quick or Prompt Assessment, to prepare a manual assessment, and route to the Accounting Operations for assessment via Form 3552, Prompt Assessment Billing Assembly.

    Note:

    All manual assessments made on Form 2859 must have interest manually computed. If the return does not need to be restricted, a TC 190 can be used. Per IRC 6631 the interest computation must be mailed to the TP. See IRM 4.19.3.16.10, Manually Computed Interest for the CP 2000, for additional information.

    • Input TC 560 on IDRS using CC REQ77 in Blocking Series 700. Up to 100 cases can be input daily using CC REQ77 or

    • Input TC 560 on IDRS using CC REQ77A. Up to 10,000 assessments can be input daily using CC REQ77A

4.19.3.22.2.1  (08-26-2016)
AMRH 25R Transcripts

  1. Do not release any credit balance when:

    • TC 971 AC 134 is present, with or without a corresponding TC 720 which sets a P- freeze condition, or when

    • The case was closed with PC 10.

    Use TC 290.00 and HC 2 to close the AUR IDRS control base. Hold code 2 must be used to hold the credit and notice.

  2. If PC 67, 68, 87, 88, 90-94, or 96 is the last action taken, refer to instructions in IRM 4.19.3.22.2.2 (5), AMRH 27F Transcripts. If no assessment information is available:

    1. Assess the entire amount of the remittance as TC 290.

    2. Restrict the interest using TC 340-0, and

    3. DO NOT issue a notice to the TP(s). Use the appropriate hold code to suppress the notice from generating.

      Note:

      DO NOT assess if open on AIMS with Source Code 14 or 85 and the transcript shows a balance due. Input PC 73 or 96 as appropriate to resolve the unsettled condition for cases open on AIMS.

  3. If PC 39, 47-53, 58, 69, 70, 71, 73, 74, 89, 91-93, or 96 is the last action taken, see IRM 4.19.3.22.2.2 (5), AMRH 27F Transcripts. These control bases are identified as AM25 or ST25. Input TC 290-0 to refund the TP's payment that is associated with the AUR notice.

    Exception:

    If the case was closed in error (i.e., TP recomputed the amount of tax owed) and there is a remittance, follow instructions in IRM 4.19.3.22.2.2 (5), AMRH 27F Transcripts.

    Caution:

    Beginning with TY 2015 PCs 39, 69 and 89 no longer designate identity theft no change closures. These PCs are input on jointly filed return cases which require assessment to MFT 31 accounts for each TP. Do not release payments on MFT 30 accounts.

  4. If PC 20 is the last action taken, refer to instructions in IRM 4.19.3.22.2.2 (3), AMRH 27F Transcripts.

  5. If PC 30, 55, 57, 59, 75-79, or 95 is the last action taken, refer to the instructions in IRM 4.19.3.22.2.2 (4), AMRH 27F Transcripts.

4.19.3.22.2.2  (09-01-2012)
AMRH 27F Transcripts

  1. If PC 39, 47-53, 58, 69, 70, 71, 73, 74, 89, or 96 is the last action taken:

    1. Close the IRP control base on IDRS if not already closed.

    2. Close the IDRS control base created by generation of the AM transcript(s). (Generally, these control bases are identified by AM27 or ST27.)

    Caution:

    DO NOT CLOSE any control base that is not assigned to AUR.

  2. If PC 91, 92, or 93 is on the module, research the account for a TC 290-0 in the AUR Blocking Series.

    1. If found, close the IRP and AM bases.

    2. If not found, follow instructions in (5) below.

  3. If the last action is a PC 20, verify that an assessment with the CRN(s) 806/807 or 766/767 with CRN 252 was input. If the assessment did not post, secure the original return. If the original return cannot be secured, research case history for assessment record information. Use this information to input the assessment.

  4. If PC 30, 55-57, 59, 75, or 77-79 is the last action taken, research the case history to see if any other PC is present.

    1. If other PCs are present, notate the PC and secure the return.

    2. If PCs are the same, notate the current notice date and research for any TP correspondence.

    Note:

    If there are multiple PC discrepancies between IDRS and AUR there may be a problem with the downloads. Notify your manager for additional instructions.

  5. If PC 67, 68, 87, 88, or 90-94 is the last action taken, determine if TC 290/291 or TC 300/301 posted.

    1. If an unresolved unpostable condition is present, coordinate with the Unpostables Function to resolve the unpostable condition as quickly as possible.

    2. If a deleted unpostable, attempt to secure the return to resolve the unsettled conditions.

    3. If TC 290/291 or TC 300/301 did not post, secure the original return. If the original return cannot be secured, research case history for assessment record information. Use this information to input the assessment manually on IDRS.

    4. If TC 290/291 or TC 300/301 did post, close the AM27 control base.

4.19.3.23  (09-01-2003)
Employee Cases

  1. To ensure the integrity of IRS employees, the Service provides careful and urgent treatment of employee cases.

4.19.3.23.1  (09-01-2004)
Overview of Employee Cases

  1. Employee AUR cases are handled differently from other AUR cases only in urgency, control, confidentiality, and may result in appropriate disciplinary actions. In all other matters, make no distinction between an employee and any other TP. This handling includes:

    • Application of tolerances

    • Criteria for referral to Examination or Criminal Investigation

    • Preparation of assessments

    • Handling of remittances

    • Appeal rights

    Caution:

    Negligence Penalty should be asserted if the Tax Account screen shows a "2" or "3" in the TC 922 HIST/CAT field(s) and a notice is issued.

    Employee cases generate by matching the AUR inventory against a list of SSNs for individuals who currently work for the IRS. The majority of these cases are Subfile 2; however, subfiles with higher priority may also contain IRS employee cases.

  2. Employee cases download in BTs 01-19 with PC 06 and are systemically moved into Employee Download BT 90000.

  3. IDRS Access Data (employee identification) is produced semi-monthly and updates AUR. Newly identified Employee cases already in a normal batch do not update with PC 06 and remain in the current batch. During the working of the case (Screening, Response, or Statutory Notice), AUR displays a message to the tax examiner to transfer these cases to the UID of the employee designated to work employee cases.

    Note:

    Occasionally, the individual working the normal AUR Program encounters cases with IRS Form(s) W-2 attached to the returns or with IRs. Do not process these cases within Subfile 2 unless the TPs are currently employed by the IRS.

  4. To expedite the handling of EUR cases, the responsible AUR employee processes all the employee cases as soon as possible.

4.19.3.23.2  (09-01-2013)
Confidentiality and Security

  1. Since EUR cases involve IRS employees, or their families, it is imperative that all persons involved in handling these cases regard the privacy of an employee as paramount in performing their work.

  2. Observe the following rules:

    1. Employee cases are processed by as few employees as possible.

    2. As with any TP case, EUR cases are discussed only with individuals specifically involved in processing them.

    3. When cases are not being worked, employee tax returns require additional security - keep in a locked cabinet.

    4. Only AUR employees with an Employee Profile Code of either 8324 or 8328 have access to the employee file cases. The AUR Coordinator assigns these profile codes to the designated employee(s) prior to the processing of the Subfile 2 cases.

4.19.3.23.3  (09-01-2008)
Quality

  1. Subject all case actions to normal Quality Review procedures in IRM 21.10.1, Embedded Quality (EQ) Program for Accounts Management, Campus Compliance Services, Field Assistance, Tax Exempt/Government Entities, Return Integrity and Compliance Services (RICS) - Integrity and Verification Operations, and Electronic Products and Services Support, with the exception of the CP 2000 Notice Review. Ensure the confidentiality of these cases.

    Note:

    As only employees with the Employee Case profile can access these cases consider cross reviews.

4.19.3.23.4  (09-01-2013)
Receiving and Controlling Employee Cases

  1. When extract tapes download into PC 06 status, information is assigned to Employee Download Batch Type 90000. Cases remain assigned to the batch until scanned by the user into an Employee Screening batch. Refer to IRM 4.19.2, IMF Automated Underreporter (AUR) Control, for information on batch building and batch status codes.

  2. Charge-outs (Form 4251, Return Charge-Out) are received as a separate print file. Case labels generate when the system moves cases from Employee Screening BT 90 to BT 91, Employee Suspense (after initial screening).

  3. Form 4251 without tax returns are not batched into Employee Screening BT 90001-999. The SSNs remain in Employee Download Batch Type 90000. The system reorders the tax return based on the reorder date input by the AUR Coordinator. If the system does not indicate the return was received (built to Employee Screening BT 90001-999), the system closes the case with PC 29 and the SSN(s) displays on the Employee Case Aging Report until the report is generated for the next week.

    Exception:

    Virtual cases do NOT have tax returns, use the TRDB or Form 1040EZ window to work these cases. The system does not reorder, nor does it allow an "X" in the ORDER RTN field.

  4. The Employee Extract downloads can only be built into Employee Screening BT 90001-999 after the extract download has been completed. If the employee extract download has not been done or is incomplete, the system displays a message indicating the extract is incomplete and cannot be batched.

  5. When cases are missing the TIF and/or U/R data, the system does not allow the cases to be built into Employee Screening BT 90001-999. The SSN(s) remain assigned to Employee Download BT 90000.

    1. If the missing data is not received within sixty (60) days, the system assigns a PC 28 and displays the SSN(s) on the Employee Case Aging Report until the report generates for the week.

    2. If the missing data is received, the SSN(s) displays on the Employee Aging Report until the SSN(s) are assigned to BT 90001-000. Batch the cases into Employee Screening BT 90.

4.19.3.23.4.1  (09-01-2004)
Batch Building

  1. When cases are assigned to a batch, there are specific stated requirements that must be met. System constraints require that a case must meet specific PC and current batch type criteria for assignment to a batch. Cases assigned to an Employee Screening BT 90000 are built by the user and the system assigns cases to Employee Suspense BT 91000.

  2. Parameters are set for the maximum volume for each work unit and batch. When the maximum volume for the work unit is reached, the system closes the work unit currently being input.

    1. Indicate the batch and work unit number on the folder and insert the cases in the folder. The system indicates the batch is complete.

    2. Close the batch using the CLOSE option.

    3. The system updates the batch status to AB (Associated Batch).

      Note:

      Batches may be manually closed at any point prior to reaching maximum volume for the batch.

  3. If a batch is created and the system is exited before entering the SSNs for the batch, the batch number deletes from the system.

  4. If the batch is created and the system is exited before completing the work unit/batch, commit the work unit currently being input. Indicate the batch and work unit number on the folder and insert the cases assigned to the work unit.

  5. When using the ADD option, the system indicates when the batch is full and cases cannot be added. When adding to a batch that is not full, the system:

    1. Indicates if the previous work unit has reached maximum size, or

    2. Displays a message indicating the SSNs are being added to a previous work unit.

  6. After a batch is closed it is possible to reopen it. SSNs may be added if the maximum volume for the work unit or batch is not reached.

    Note:

    The batch status reverts to a blank value. Closing a batch automatically updates batch status to AB (Associated Batch).

  7. Once the maximum volume is reached or the volume of the batch is such that you do not want to add any additional SSNs, close the batch using the CLOSE option. The system updates the batch status to AB (Associated Batch).

  8. After the batch status is updated, the Sequence-SSN Batch Listing may be printed. The Batch Listing is a transmittal document verifying the contents of the batch.

4.19.3.23.4.2  (09-01-2004)
Case Sequence Number (CSN)

  1. Keep employee cases in the original batched order for all phases of the program. Cases retain the last seven (7) digits of the CSN. Only the BT changes from 90 to 91 during system disassembly.

  2. Cases transferred to Employee Unit Suspense BT 92 only have a five (5) digit CSN. The first two (2) digits are 92 and the last three (3) digits are the unit location number. These cases are filed in SSN order.

4.19.3.23.4.3  (09-01-2004)
Assigning and Releasing Employee Cases

  1. Cases in Employee Screening BT 90 are assigned and released by work unit or individual cases.

  2. Each Case in Employee Suspense BT 91 and Employee Unit Suspense BT 92 are assigned and released individually. Cases with notice, letter, and closure PC(s) released Monday through Friday upload on the weekend runs.

  3. If the case is in BT 91 or 92, and Employee Disassembly (AURX047) did not process the changes previously made to the case, the message "WARNING: EMPLOYEE DISASSEMBLY HAS NOT PROCESSED CHANGES ON THIS CASE" displays when assigning a case. Analyze the case to determine the appropriate actions necessary to process the case.

  4. Cases with automatic assessments upload daily to SCRS.

4.19.3.23.4.4  (09-01-2004)
Employee Unit Suspense Batch Type 92

  1. These are cases the system identified as employee cases during processing.

  2. When cases are transferred to Unit Suspense, the system automatically generates IPC 0E, 3E, 6E, or 8E and moves the case to BT 92.

4.19.3.23.5  (12-15-2015)
Case Actions

  1. Several actions taken during the course of Employee case file processing have unique handling instructions.

    Note:

    When the Employee Tax Compliance Program (ETCP) needs case data, make one copy of the entire AUR case contents and forward the information using the procedures supplied via the ETCP contact. These instructions apply to all tax years currently being worked in the AUR Program.

  2. The entire AUR (system) case contents includes the following:

    • Tax Account

    • Information Returns

    • Case Notes

    • Case History

    • CP 2000

    • CP 2501

  3. Beginning with notices dated 02-24-2014, the AUR system maintains a copy of the Statutory Notice. A copy of these Statutory notices can be accessed and printed using the following:

    • Print menu - Case contents - Statutory Notice

    • Case - Case History - click on the View Notice box

    See IRM 4.19.7, IMF Automated Underreporter (AUR) Technical System Procedures, for additional information. For notices dated prior to 02-24-2014 copies are maintained on Control D.

4.19.3.23.5.1  (09-01-2004)
Examination and Fraud Referrals

  1. Due to the sensitivity of Employee cases, manually coordinate cases which require Examination or Fraud referral. The use of IPCs 0D, 3D, 3F, 6D, 6F, 8D and 8F are used for case referrals. As the system maintains a record of these IPCs, no additional notation is needed in the case file, unless an explanation for the referral is deemed appropriate as a case note. See IRM 4.19.3.4.8, Fraud Referral Program, for new Fraud referral procedures.

4.19.3.23.5.2  (09-01-2004)
Case Transfer/Closure

  1. Transfer/Closure of cases removes the case from AUR processing and reassigns control of the case to another Operation (Examination or Criminal Investigation). As the system maintains a record of these closing PCs, no additional notation is needed in the case file, unless an explanation for the transfer/closure is deemed appropriate as a case note. Print the complete AUR case contents (See IRM 4.19.3.23.5, Case Actions) and include them as part of the case file.

4.19.3.23.5.3  (04-07-2009)
Case Notes

  1. Use the Case Note window to document all case actions and TP contact. Events may occur in the working of a case which are important, significant or justify your determination/action. A case note should be left as an appropriate action trail. Case Notes are not meant to be a full case history; they are an abbreviated record to insure all cases are correctly and expeditiously handled.

4.19.3.23.5.4  (09-30-2014)
Manual Interest

  1. The tax examiner must compute Manual Interest when necessary. The system displays a warning message if conditions exist for Manual Interest. Identify notice dates for CP 2000/Recomps prior to working employee cases. See IRM 20.2.5.6.1, Reasons to Manually Compute Interest, for additional information regarding when interest needs to be manually computed. See IRM 4.19.3.16.10, Manually Computed Interest for the CP 2000, for additional instructions.

  2. Ensure BT 90, with Manual Interest, is updated to "RB" status or release cases from BT 91 and 92 during the week ending date for the notice date selected during the Manual Interest computation.

4.19.3.23.5.5  (09-01-2008)
Internal Process Codes (IPC)

  1. Due to the sensitivity or extensive physical control required by the use of certain IPCs, the following IPCs are not valid when working employee cases:

    • 0P and 0T

    • 3P and 3T

    • 6P and 6T

    • 8P and 8T

    • MI, RC, RN, SR, and RF

  2. The following IPCs are valid when working employee cases:

    • 0A and 0D

    • 3A, 3D, and 3F

    • 6A, 6D, and 6F

    • 8A, 8D, and 8F

      Note:

      The SSN remains assigned to the current batch when the above IPCs are input.

    • LC and WP

      Note:

      The system moves cases with IPC LC to Employee Suspense BT 92.

4.19.3.23.5.6  (09-01-2004)
Potential Payer Agent

  1. Employee cases cannot be transferred to the Payer Agent Coordinator if IRs appear to be erroneous and were not identified with a Payer Agent Code. Coordinate manually with the Payer Agent Coordinator for instructions regarding any potential erroneous IR(s).

4.19.3.23.5.7  (09-01-2006)
Notice Indicators 0, 7 and 8

  1. Due to the extensive physical control required, Notice Indicators 0 (zero), 7, and 8 are not valid for employee cases.

  2. If the TP’s response is a partial agree that would otherwise have been closed with IPC RN or SR, issue a recomputed notice (PC 59 or PC 95) for TP’s signature. However, if there is insufficient time left on the Statutory Notice suspense period use PC 88 to assess the case.

4.19.3.23.6  (09-01-2004)
Releasing Employee Screening Batch Type 90

  1. PCs are not verified on SSN(s) within the batch. Refer to IRM 4.19.2, IMF Automated Underreporter (AUR) Control, for further information on updating batches to "RB" (Release Batch) status.

  2. When updating BT 90 to "RB" status, only notice, letter, and closure PCs are valid.

4.19.3.23.7  (09-01-2004)
Notice Rejects

  1. AUR generates a weekly listing for notice rejects on Employee cases. The listing includes the SSN and Reject Code. See IRM 4.19.2, IMF Automated Underreporter (AUR) Control, and see IRM 4.19.3.17, Automated Underreporter (AUR) Rejects, for more information. The Clerical Function provides employee case SSNs and reject conditions to the tax examiner responsible for working Employee cases.

4.19.3.23.8  (09-01-2004)
Undeliverables

  1. When a CP 2501, CP 2000 /Recomp, or Statutory Notice is returned by the Post Office as undeliverable, either:

    1. Research IDRS and take appropriate actions to remail the notice to a better address, if found or

    2. Under the EMPLOYEE option on the Case Analysis screen, select UNDELIV NOTICE. The cursor displays a message indicating the case has a new address or no new address was found. The system enters the appropriate Undeliverable Indicator ("T" or "U" ) in the UNDELIVERABLE IND field. After entering the SSN(s), press <COMMIT>.

4.19.3.23.9  (09-01-2010)
Correspondence Received

  1. Employee case responses are either:

    • handled by the manager of Receipt and Control's Unidentified Unit, who opens the response to determine if a remittance is enclosed, deposits the remittance, and forwards all responses to AUR or

    • routed to AUR unopened.

  2. When a response to a CP 2501, CP 2000, CP 2000 Recomp, or Statutory Notice is received, input the IRS Received Date. Use the following priority criteria to determine the IRS Received Date:

    1. Received Date stamped on correspondence,

    2. Envelope postmark date or the date stamped by the Fax machine,

    3. Signature date, or

    4. Current date.

  3. Under the EMPLOYEE option on the Case Analysis screen, select RCVD DATE. The cursor displays in the SSN field. Enter the SSN and press <ENTER>. The AUR RCVD DATE field displays the current date. The cursor moves to the IRS RCVD DATE field. Enter the IRS Received Date and press <ENTER>.

  4. After entering the SSN(s), press <COMMIT>.

  5. Request Employee Suspense BT 91001-999 and update to AU, Assigned Unit, status when the tax examiner begins working responses.

4.19.3.23.10  (09-01-2004)
Letters

  1. In order to ensure the confidentiality of Employee cases, it is recommended that correspondence to the TP be manually issued using Correspondex Letters as follows:

    1. Use the Correspondex Letter window to create letters to the TP.

    2. Print three (3) copies of the letter (2 copies are mailed to the TP and 1 copy is retained in the case file).

    3. Delete the letter from the window.

    4. Mail two copies of the letter with a return envelope, that same day.

    5. Leave a case note.

    6. Use IPC 3S (CP 2501 phase), 6S (CP 2000 phase) or 8S (Statutory Notice phase), as appropriate.

  2. Return the case to the suspense file with the date the letter was mailed clearly annotated on the folder.

  3. Monitor the case. At the end of the letter suspense time frame, take appropriate action to continue processing.

4.19.3.23.11  (08-26-2016)
Employee Case Assessments

  1. Auto assessment and Statutory Notice assessment processing were expanded to include most assessments. Generate an auto assessment by either entering an assessment PC or completing the Assessment window. Input/verify the necessary items on the Assessment window to create automatic assessments.

  2. The manual assessment document is no longer required on the majority of assessments, but can be created if necessary.

  3. The system automatically creates an assessment record on all cases until a locally determined date but no later than the date listed in the table below:

    Notice Type TY 2013 TY 2014 TY 2015
    CP 2000 January 6, 2017 January 5, 2018 January 4, 2019
    Statutory Notice May 5, 2017 May 4, 2018 May 3, 2019

    All assessments (after the locally determined date or the dates listed in the table above) MUST be input via IDRS. Use the AUTO/MANUAL box on the Assessment window to initiate printing of the assessment document.

  4. AUR uploads the Transaction Codes, Reference Numbers, and other data items necessary for automatic assessments.

4.19.3.23.12  (09-01-2005)
Aging Cases in Batch Type 91 and 92

  1. If a CP 2000/CP 2501 case was not worked and released within 60 days from the notice/letter date (CP 2000 Foreign/FPO/APO is 75 days), the system generates an Employee Case Aging Report displaying the SSN(s).

  2. The SSN(s) remain on the report until the case is assigned.

  3. Statutory Notice cases display on the report after 105 days from the Statutory Notice date (Statutory Notice Foreign/FPO/APO is 165 days).

4.19.3.23.13  (09-01-2005)
No Response Cases

  1. No response cases that meet the required suspense time frames are systemically checked to identify conditions that require action before issuing a Statutory Notice. For a list of these conditions, refer to IRM 4.19.2, IMF Automated Underreporter (AUR) Control. See IRM 4.19.3.19, No Response/Undeliverables, for instructions in resolving these conditions.

    Note:

    More than one condition may exist on the case. However, the system only displays one condition when assigning the case.

  2. Before generating Statutory Notices, research both spouses on IDRS for a better address. The system identifies a new address for the primary TP but not for the secondary TP.

    1. If a new address is found for an undeliverable case, issue a new CP 2000 to that address.

    2. If more than one address is found, and you are in doubt as to the correct address, issue Statutory Notices to every address.

    3. This applies regardless of whether the TP(s) already received the notice.

4.19.3.23.14  (09-01-2004)
Reports

  1. Employee File Information displays on the Open Transfer, Unit Inventory, and Cases in Error reports to managers with an Employee File profile.

  2. Reports and Batch Listings for Employee File cases are available to managers, tax examiners, and clerks with an Employee File profile.

4.19.3.23.14.1  (09-01-2004)
Employee Case Aging Report

  1. This report indicates which cases have met appropriate suspense time frames, cases closed by the system, or cases where missing data was received. This report is systemically generated on a weekly basis and is printed by the user. The report displays the following information:

    1. Cases with Missing Data/BT 90000. The system closes the case with PC 28.

    2. Cases where the Missing Data was received.

    3. Cases in BT 90000 that were systemically reordered and not received. The system closes these cases with PC 29.

    4. Cases in BT 91 and 92 that have met the suspense time frames were met.

    5. Cases in BT 91 and 92 that have had no action taken at the end of the suspense time frame.

4.19.3.23.14.2  (09-01-2004)
Employee Case Open Inventory Report

  1. This report is systemically generated on a weekly basis and is printed by the user. Use this report to monitor open employee cases. Cases in BT 90 and 91 display in CSN order. Cases in BT 92 display in SSN order. The following information displays on the report:

    • CSN

    • SSN

    • UID (displays only if the case is assigned)

    • Latest Process Code

    • Latest Process Code date

    • Confirm Indicator ("Y" displays if the PC and/or CP 2000/Recomp Page 2 information was confirmed).

    • Latest Notice/Letter date

    • Latest Received Date of correspondence

    • ASED date - Statute date

4.19.3.23.14.3  (09-01-2004)
Employee Case Closed Inventory

  1. This report displays all employee cases that were closed. The report is systemically generated on a weekly basis and displays the following information:

    • SSN

    • UID

    • Process Code

    • Process Code date

4.19.3.23.14.4  (09-01-2004)
Employee Case Auto Assessments

  1. This report is used to verify auto assessment cases are in the correct adjustment sequence series for shipment to Files. This report generates daily by the system and is printed by the user. This report must be printed daily if assessments are input. Each time AURX060 is run, the report displays new information. The following information displays on the report:

    • Seq Number - sequence number the case must be in when sent to Files

    • Old Loc - the location of the case

    • UID - the UID of the tax examiner who input the automatic assessment

    • SSN - the SSN of the Employee case

    Note:

    Returns must be kept in the order in which they are scanned.

4.19.3.24  (10-30-2015)
AUR Reconsideration (RECON) Cases

  1. AUR RECON, sometimes called "first-read" or "late response" cases, are responses received after the case has been closed (assessment or no change) on the AUR system. A RECON is a claim for a credit or refund not previously reported or allowed (no change due to no response to a refund CP 2000), or a request for abatement of tax, penalty, and/or interest. Use the same guidelines in making determinations for RECON correspondence as when working open AUR cases.

  2. When working with non-current AUR tax year requests for RECON, as a general rule, the tax examiner should apply the most current AUR procedures in the processing of the RECON. The tax examiner needs to consider year specific issues such as Advance on Child Tax Credit (applies only to TY 2003), Rate Reduction Credit (applies only to TY 2001), ACA provision 10908 (applies to TY 2009 and subsequent), etc. as well as year specific regulations regarding limitations, phase-outs, tax rates, etc.

  3. If the RECON is based on a claim of identity theft and the response includes Form 14039 or a police report, close and refer the case to the AUR IDT liaison.

  4. If the RECON is based on a claim of identity theft and the response does not include Form 14039 or a police report, see IRM 4.19.3.20.1.25, Identity Theft (IDT) Claims - Overview, IRM 4.19.3.20.1.25.2, IDT - General, IRM 4.19.3.20.1.25.3, IDT Claims - Initial Handling, and IRM 4.19.3.20.1.25.3.1, IDT Claims - Responses, for guidance to work the case.

4.19.3.24.1  (09-30-2014)
Appeals Closures - PC 80

  1. If the case was closed with PC 80, research to determine if the case can be appealed (worked as a RECON). Cases that are closed with finality including "dismissals for lack of prosecution" cannot be appealed. Cases identified as closed/dismissed "due to lack of jurisdiction" , can be worked using the AUR RECON process. See IRM 8.7.7.11.2, Reconsideration of Claim Previously Disallowed and Previously Considered by Appeals, for additional information on cases closed with finality.

    Caution:

    If the case was closed with PC 66, Appeals denied the request and has returned the case to AUR, see IRM 4.19.3.20.1.8 (1) Note, Appeals.

  2. To determine if the case can be worked as a recon take the following actions:

    1. Research IDRS for the presence of an assessment for the AUR amount. If no (TC 300) assessment is present, forward response to the appropriate Appeals Office. If an assessment is present, go to step 2.

    2. Access the U.S. Tax Court Website at ustaxcourt.gov.

    3. Click on the tab titled "Docket Inquiry" .

    4. Select either Docket Number or Individual Party Name.

    5. Enter the required information to access the case.

    6. Once accessed, read the court decision to determine if the case was closed due to lack of jurisdiction or closed with finality.

  3. The decision of the Tax Court is final 90 days from the date the decision is entered unless either party files a timely notice of appeal. Unlike a regular case (non-S case), an "S case" (a case with a docket number that ends with "S" ) cannot be appealed.

    • If the decision indicates the case was dismissed for "lack of jurisdiction" , continue processing as an AUR RECON case. Use TC 291 when decreasing the original assessment.

      Note:

      The IAT "xClaim" or "REQ54" tool must be used when making an adjustment on an account.

    • If the decision indicates the case was closed with finality, issue a Letter 916C, using the IAT "Letters" tool, to the TP denying the reconsideration. Use the following verbiage as an example: "Your request for reconsideration is denied. Our records indicate you filed a petition with the U.S. Tax Court regarding this issue. The Court has entered a final decision which cannot be considered by the IRS."

4.19.3.24.2  (08-26-2016)
RECON Receipt, Tracking and Reporting

  1. Correspondence is initially sorted by the Clerical Function based on whether or not the AUR case is still open. If open, the correspondence is batched with regular AUR receipts. If the AUR case is closed, the correspondence is considered a RECON. Correspondence for RECONs may also be sorted by tax year.

  2. Ensure RECON casework is reported under the correct OFP code.

    Reminder:

    Consider time spent on cases that involve claims of identity theft, cases that result in an adjustment to the AUR assessment (RC 067 and 068) and cases that do not result in an adjustment to the AUR assessment (RC 064 and 066) when reporting time for RECON casework.

    Note:

    If an IDRS control base is open, an adjustment TC 29X with the appropriate Reason code must be input, except for re-routes and miscellaneous correspondence that does not request a change to the AUR assessment. The IAT "xClaim" or "REQ54" tool must be used when making an adjustment on an account.

  3. The clerical function counts and records the volume of RECON correspondence. As a rule, these receipts are delivered to Technical Managers for assignment.

    1. Closed cases for specific tax years may be built into BT 81 or 83 (Employee Reconsiderations).

    2. If cases do not build into BT 81 or 83, they are not controlled within AUR, and accurate manual counts of correspondence/cases received and resolved must be maintained.

  4. RECONs must be controlled no later than 14 days from the AUR received date on:

    1. AUR for TY 2005 and subsequent

    2. IDRS (TXMOD) for TY 2004 and prior

  5. AUR RECONs are subject to Action 61/Policy Statement P-21-3 guidelines per IRM 4.19.3.20.1.5, Action 61/Policy Statement P-21-3, (TP contact must be made within the 30 days criteria).

    Note:

    The IAT "Letters" tool must be used to issue a letter to the TP.

    1. IDRS Letter 86C is used to send to the TP if you are sending the response to another campus/area.

    2. IDRS Letter 4314C is sent to the TP as a first or second interim letter.

  6. Phone call RECONS must be controlled by the TE receiving/working the case. Incoming phone call or responses for multiple years or TPs, qualifying as a RECON must be counted into the inventory. A case count is taken for each account that requires an action. Report each new RECON receipt to the lead or manager. It is recommended that an action be taken within one day of receipt of these cases.

    Note:

    Phone call initiated RECONS must be controlled on AUR/IDRS if held for further action.

    Exception:

    Telephone RECONs that qualify for inclusion in inventory should be built into BT 81 or 83.

  7. IDRS actions are necessary on certain AUR RECON cases. If IDRS actions are necessary on an assigned RECON case, the control base on IDRS must be opened and either updated or closed using IDRS CC ACTON or IAT "ACTON" tool, when appropriate.

    1. Use the ACTIVITY field to document actions and pending dates.

    2. When suspensing a case, ordering a document or contacting the payer, update your status control to "M" (monitor).

    3. Use IDRS history items to document additional information.

  8. Cases are considered aged when the IRS received date is greater than 45 days.

  9. The following Reason Codes are used to indicate the type of RECON resolution:

    Caution:

    AUR RECON Reason Codes CANNOT be entered in the fourth position (REQ54 on IDRS or IAT). The fourth position is reserved for penalty reason codes only.

    • RC 064 - Reconsideration No-Response - use this code when the initial RECON case does not supply sufficient information and the request for additional documentation is a No-Response.

    • RC 066 - Reconsideration Disallowed in Full - use this code when the original AUR assessment is NOT adjusted.

    • RC 067 - Reconsideration Disallowed in Part - use this code when the original AUR assessment is partially adjusted.

    • RC 068 - Reconsideration Allowed in Full - use this code when the original AUR assessment is fully reversed.

  10. The IAT "xClaim" or "REQ54" tool must be used when making an adjustment on an account.

4.19.3.24.2.1  (12-15-2015)
Batch Type 81 - Reconsiderations and Batch Type 83 - Employee Reconsiderations

  1. Closed cases for Tax Years 2005 and subsequent are built into BT 81 or 83.

  2. BT 81 and 83 are used to control, monitor and track closed correspondence received in AUR for RECON of the assessment.

    Caution:

    RECON cases do not have full functionality on the AUR system and should not be transferred.

  3. Internal PCs have been designated for use with cases in BT 81 or 83 as follows:

    IPC Definition Action
    9B IDT Recon - Fresno CSCO IDT Specialized Team/DITA Referral Moves case to BT 82 for Recon Suspense.
    9E Recon Research/Referral within AUR Moves case to BT 82 for Recon Suspense.
    9F Recon Full Abatement of the AUR Assessment Closes the Recon case within AUR and moves the case to closed BT 96002 - use with IDRS RC 068.
    9I Recon Information Request/MISC (Not appropriate if an abatement is made, use 9F or 9P) Closes the Recon case within AUR and moves the case to closed BT 96002.
    9L Recon Payer Letter Moves case to BT 82 for Recon Suspense.
    9N Recon No Change to AUR Assessment Closes the Recon case within AUR and moves the case to closed BT 96002 - use with IDRS RC 066 or RC 064, as appropriate.
    9P Recon Partial Abatement of the AUR Assessment Closes the Recon case within AUR and moves the case to closed BT 96002 - use with IDRS RC 067.

    Note:

    IPC 9P should be used when the original AUR closure was no change and the RECON results in a change to the account.

    9R Recon Referral - Non-AUR Issue Closes the Recon case within AUR and moves the case to closed BT 96002.

4.19.3.24.2.2  (09-30-2014)
Batch Type 82 - RECON Suspense

  1. RECON cases in BT 81 that the tax examiner determines needs additional action are systemically moved to suspense BT 82 at assignment of IPC 9B, 9E and 9L.

    Caution:

    IPC 9L is ONLY used for Payer letters (Letter 2625C).

  2. When the requested research or a TP response is received, the clerks will route the information to the appropriate technical unit as designated in the Remarks Field on the Research Document.

  3. Local management determines whether RECON Suspense BT 82 is located in the individual tax examining units or in the clerical area. AUR reports are available to monitor the age of cases in BT 82.

4.19.3.24.3  (09-30-2014)
Initial Case Actions

  1. A STAUP prevents issuance of collection notices until the cycle delay request has expired or has been released. Generally, a STAUP is set no longer than 9 cycles but can be set up to 15 cycles, if necessary. If AUR and/or IDRS research shows the TP's account is in balance due notice status, ensure input of IDRS CC STAUP with a definer "S" , to prevent the TP from receiving additional collection notices while the response is being worked.

    • A STAUP is not released by input of a TC 29X, whether the adjustment is an increase, decrease, or a zero amount.

    • If the case is in collection status input TC 470 on IDRS using the IAT "REQ77" tool. See Exhibit 4.19.3-14, Notice Delay Actions (Reconsiderations).

  2. If resolution of the case results in a remaining balance due, reduce STAUP to allow the notice routine to continue, see Exhibit 4.19.3-15, Cycle Chart (Reconsiderations).

    Note:

    When closing or updating a case and the adjustment creates a zero or credit balance, this action is not required.

  3. If the case was closed with PC 66, Appeals denied the request and has returned the case to AUR, see IRM 4.19.3.20.1.8 (1) Note, Appeals.

  4. When suspending cases for payer contact, additional research, returns, etc., a record of case actions must be maintained. Options for this record include:

    • Case notes on AUR, providing the case has not been archived

    • IDRS History Items

    • Assignment of IPC 9B, 9E or 9L, if the case is in BT 81 or 83

    Note:

    Worksheets used in recomputation or any TE notes should be maintained with the case.

  5. Each correspondence sent to the TP should:

    • Cover all questions asked by the TP

    • Address all adjustments requested by the TP

    • Address all AUR Tax Year issues

  6. Many RECONs received in AUR do not require a written notification to the TP, unless an interim letter has been sent. Some examples are:

    • Duplicate correspondence - the adjustment has already been made per an earlier request for a tax change or an adjustment action. Duplicate correspondence is generally treated as classified waste.

    • Credit transfers - TP wants a payment moved to another account.

    • Penalty abatement request granted - follow penalty relief guidelines to make a determination.

    Note:

    If these cases are in BT 81 or 83, assign IPC 9I, which closes the AUR case control. Input TC 290-0 using the IAT "xClaim" or "REQ54" tool or complete Form 9856 to associate the information to the AUR Case file retained in Files. Close the IDRS control base, if applicable.

  7. The following list includes the most common reasons written notification to the TP is needed:

    • Explain W/H adjustments

    • Request additional information

    • Answer TP’s questions

    • Explain penalty abatement request denial - follow penalty relief guidelines to make a determination

    • Explain the inability to abate interest

    • Provide recomputed figures with the correct balance due/refund (If the TP did not provide the figures)

    • Send a disallowance or partial disallowance letter

    Note:

    The IAT "Letters" tool must be used to issue a letter to the TP.

  8. AUR should NOT release the TC 360 lien fee. Even in instances when the AUR adjustment is completely abated, the Notice of Federal Tax Lien (NFTL) should NOT be abated. The fee is charged because the TP did not timely and/or completely address a balance due AND the fee could apply to multiple amounts due or cover more than one lien and is compounded because the TP did not resolve the compliance issue in a timely manner. Therefore, even though the AUR assessment may be fully abated, the TP may still be liable for the lien fee. Refer the abatement request to Advisory (SERP, Who/Where, Advisory) http://serp.enterprise.irs.gov/databases/who-where.dr/als.dr/case-processing-lien-units.htm and Advisory addresses are shown in Pub 4235, Collection Advisory Group Addresses. If the only remaining assessment on the module is the lien fee, the lien will not release unless the fee is paid. Issue a letter to the TP informing them that the lien fee must be paid in order for the lien to release.

  9. IDRS research is necessary to determine if two or more people/areas have an open control base on the same account. When it is determined that a multiple control condition exists, coordinate with the other person/area for potential case resolution.

4.19.3.24.4  (08-26-2016)
Routing/Work Flow Determination

  1. Routing to other areas may be required for some RECON correspondence.

  2. Within Operation routing:

    • Spanish correspondence may need to be sent to the appropriate bilingual person

    • Manual refunds must be approved by the manager

    Note:

    If the case is in BT 81 or 83 transfer the case to yourself; the AUR system will assign IPC 9E.

  3. Within Campus, route the following non-AUR issues:

    • Injured Spouse

    • AUR Examination closures

    • NOL cases

    • Scrambled SSN

    • Mixed Periods/Entity

    • Filing status changes (Married filing separately, single, or head of household to married filing joint)

    • Examination Criteria (CAT-A) refer to IRM 21.5.3-2, Examination Criteria (CAT-A) - General, or follow local routing procedures

    • Accounts Management criteria refer to IRM 21.3.1.4.55, Status of IMF Underreporter Cases

    Note:

    If the case is in BT 81 or 83 assign IPC 9R.

  4. Originating Campus: If IDRS CC TXMODA or CC IMFOLT shows TC 922 with the initial PC 03 and an AUR closing PC send the correspondence to the campus that issued the original CP 2000. The campus is identified by the first two digits of the TC 290 DLN. Follow the routing guidelines in (7) below.

    Caution:

    If the received date is old, fax the correspondence to the originating Campus to expedite the case. Call the originating AUR Campus to advise of the incoming fax. Use IDRS CC MESSG for other Campus phone numbers. Route the original correspondence.

    Note:

    Some RECON correspondence may require special/expedited handling and may be retained and worked by the receiving site.

    Exception:

    If the first PC is 02, the case was worked manually prior to the automated system. Do not route these cases. Order the return if the case cannot be worked with available information.

  5. Backup Withholding - Route Backup Withholding issues to Collections. See IRM 4.19.3.20.1.9, Backup Withholding (BWH), for additional information. If the case is in BT 81 or 83 assign IPC 9R.

  6. Deceased/Incarcerated - If the issue is ONLY a payment of balance due, route to Campus Collection. If the issue is the amount of the assessment, work as an AUR RECON. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ If the case is in BT 81 or 83 assign IPC 9R.

  7. When routing RECON correspondence:

    1. Send IDRS Letter 86C to the TP using the IAT "Letters" tool.

    2. Input a CC STAUP for 9-15 cycles, as needed.

    3. Document the reason for routing in the case file.

    4. If established, close the control on IDRS, and update the activity.

4.19.3.24.5  (02-12-2016)
Evaluating RECON Correspondence

  1. As with all TP correspondence, determine if AUR is the appropriate area to respond to the TP's need. Carefully read the entire contents of the correspondence and address all the AUR issues, including other AUR tax years. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Perform appropriate research so timely actions can be taken.

    1. Full and partial adjustment refers to the AUR assessed amount.

    2. When fully or partially disallowing RECON requests, send the appropriate C-Letter using the IAT "Letters" tool.

  2. If a response is received for another AUR site and the Assessment Statute date expires within 90 days, work the RECON and see (6) b below.

  3. When W/H is an issue, verify the information provided by the TP before adjusting.

    Note:

    When the case was closed no change due to the TP not responding to the AUR notice reflecting a refund and additional information and/or documentation is not provided to support the refund; contact the TP for additional information. Refer to IRM 4.19.3.24.7, Taxpayer Contact for Additional Information.

  4. Taxpayers who originally filed a joint return may not change to married filing separately after the due date of the return unless the original joint return was fraudulently filed. Refer to Exam for a determination.

  5. An erroneous refund is any receipt of money from the Service to which the recipient is not entitled. It includes all erroneous payments to the TP, even if the erroneous refund involves returning the TP’s own money. Refer to IRM 4.19.3.4.11, Erroneous Refunds, for additional information.

  6. ASED - Assessment Statute Expiration Date normally expires three years from the date the original return was filed or three years from the due date of the return, whichever is later.

    1. Some conditions extend the ASED, such as bankruptcy, 25 percent omission, filing joint after filing separate, fraud, etc. Refer to IRM 25.6.1.5, Basic Guide for Processing Cases with Statute of Limitation Issues, for additional information.

    2. If the Assessment Statute date expires within 90 days, and there is an increase to tax, the case will need to be sent to the RACS Unit for Assessment. Refer these cases to the AUR Statute Coordinator for preparation of Form 2859.

  7. RSED - Refund Statute Expiration Date. Generally a claim for refund must be filed within 3 years from the time the original return was filed or 2 years from the time the tax was paid, whichever is later. Claims for refunds must be filed on or before the RSED. Although the claim may be filed timely, actual refunds and/or credits may not be allowable depending on when the payments were made or offsets applied.

  8. When adjusting an account, the RSED may be imminent or may have expired. Refer to IRM 25.6.1.5, Basic Guide for Processing Cases with Statute of Limitations Issues, IRM 25.6.1.7.2, Time When Payments and Credits are Considered to be Made, and IRM 25.6.1.10.2.7, Claims for Credit or Refund - General Time Period for Submitting a Claim, for additional information.

  9. Some conditions extend the RSED, such as overpayment resulting from bad debts and worthless security losses, or their effect on carry overs and carry backs, net operating (NOL) or capital loss carry backs or certain credit carry backs, financial disability, etc. Refer to IRM 25.6.1.10.2.8, Claims for Credit or Refund - Special Items of Income, Deduction, Loss or Credit, and IRM 25.6.1.10.2.9, Claims for Credit or Refund - Taxpayers in Special Situations, for additional information.

  10. RSED cases have to be statute cleared. The statute clearance stamp is valid for 90 days. If the amended return or claim is rejected back to the TP, and/or the clearance stamp is more than 90 days old, the case must be re-cleared before it is allowed.

  11. When the TP's response results in either a full or partial abatement refer the chart below to determine the appropriate action:

    IF AND THEN
    AUR adjustment is fully unpaid ASED is open Follow appropriate adjustment procedures per IRM 4.19.3.24.5.1, Full Adjustment Determinations, or IRM 4.19.3.24.5.2, Partial Adjustment Determinations.
    Response results in either a full or partial abatement of the AUR assessment TC 604 is present on the account due to bankruptcy discharge/dismissal Coordinate with the AUR Bankruptcy Coordinator to:
    1. Post the assessment on the appropriate existing MFT 31 account or

    2. Contact the Centralized Insolvency Operation for guidance.

    Response results in either a full or partial abatement of the AUR assessment TC 604 is present on the account due to approved refund of funds on an Innocent Spouse case Coordinate with the AUR Innocent Spouse Coordinator to:
    1. Post the assessment on the appropriate existing MFT 31 account or

    2. Input a TC 972 AC 131 to generate the TC 605 which reverses the TC 604 and allows subsequent adjustments to post to the account.

    3. If a balance due remains after the adjustment posts, reinput the TC 971 AC 132 to generate a TC 604.

    Response results in either a full or partial abatement of the AUR assessment The TC 604 is due to reasons other than Bankruptcy or Innocent Spouse. Coordinate with the AUR Bankruptcy Coordinator to:
    1. Post the assessment on the appropriate existing MFT 31 account if the MFT 31 account(s) has been created or

    2. Contact the appropriate Collections Office to request a temporary reversal of the TC 604 if MFT 31 account(s) have not been established. See IRM 21.6.8.7.2, Adjusting MFT 31 Accounts, and 21.6.8.5.1, Mirrored Accounts, for additional information.

    Response results in either a full or partial abatement of the AUR assessment TC 706 is present See (13) below.
    Response results in either a full or partial abatement of the AUR assessment The RSED has expired on all or part of the payments Determine total requested and total allowable changes to tax and prepaid credits. See (12) below.
    TPs filed a joint return but are now divorced A payment is being refunded Verify the refund is issued to the TP that made the payment. A credit transfer may be necessary to ensure the payment refunds from the appropriate TP module. To transfer the credit, use the IAT "Credit Transfer" tool. See (13) below.
  12. When it is determined the RSED has expired on all or part of the payments (TC 610, 640, 670, or 706) or refundable credit (TC 806, 764, 766 and 768) or when the tax should be partially or fully reversed, but the RSED has expired on all or part of the payments, move the expired payment(s) to the Excess Collection File (XSF). To correct the account, take the following actions:

    Caution:

    Do not create a refund condition by allowing more net credits than the tax increase.

    Note:

    For additional information see IRM 25.6.1.5, Basic Guide for Processing Cases with Statute of Limitations Issues.

    1. Use the IAT "xClaim" or "REQ54" tool to reverse the AUR assessment using a HC 4 to stop the adjustment notice and hold the credit.

      Note:

      If a timely claim is received after the Refund Statute Control Date (RFSCDT) has expired, then use Override Code "S" . If the override code is not entered, the following error message displays; "Override Needed." If response received date is more than 1 year old; use Override Code "R" . If RFSCDT is after RSED use Override Code "S" . Both Override Code "S" and "R" may be necessary.

      Note:

      The date input in the RFSCDT field cannot be after the RSED if the claim is timely, or a "-D" freeze transcript will generate. A resulting credit balance is frozen at Master File with a "-D" freeze that will stop any payments from refunding.

    2. Open a new IDRS control to monitor the account for the adjustment to post.

    3. Send the TP a disallowance letter explaining that the refund statute has expired. Do not ask the TP for additional information if the statute has expired. Use the IAT "Letters" tool to issue either the Letter 105C, Claim Disallowed, or Letter 106C, Claim Partially Disallowed.

      Note:

      Since the TP will not receive an adjustment notice, be very specific in the explanation of the adjustment on the letter.


    After the AUR adjustment posts,

    1. Use the IAT "Credit Transfer" tool to transfer payment(s) to the appropriate module for refunding, when appropriate (i.e., TC 706). See (13) below.

    2. Move any expired payment(s) to the Excess Collection File (XSF). Complete Form 8758, Excess Collections File Addition, and follow local routing procedures. Complete a separate form for each payment or credit that needs to be dumped.

      Exception:

      A Form 8758 should not be used for TC 736. Statute handles this TC when it is expired.

    3. Update the IDRS control to a monitor status and update activity (example, "6800CR" or "8758toxcss" ).

    4. Input TC 971 AC 296 using the IAT "REQ77" tool. Use the current date in the TRANS-DT field and "expired payments" or similar wording in the remarks field.

      Note:

      If total credits are over $100,000, secure managerial approval.

    5. Monitor the case and once the credit is dumped, close the AUR IDRS control. Any refundable credit left on the account will be released by Statute.

  13. If the TP's response results in either a full or partial abatement of the AUR assessment on a married filing joint (MFJ) account, any refund generated by the abatement must be paid jointly to both spouses unless one or more TC 706 is present and all four of the following items are true:

    • The spouses’ names on the account do not both appear on the originating account. Meaning, the TC 706 credits must transfer from one spouse on the originating account either as a single or separate filer or as a joint filer with a new spouse.

      Example:

      Mary Doe filed single for 201X. Her 201X overpayment offsets with TC 706 to the prior year account filed as John and Mary Doe, married filing joint. (The year shown as "201X" should be the AUR year of the case you are working.)

    • No payments or credits other than a TC 706 posted to the account since the AUR assessment.

    • In the case of partial abatements, all TC 706 credits transferred from the same person.

    • All TC 706 occurred less than two years before the date of the full or partial abatement.

    If a TC 706 is present and all four of the above items are true, move the applicable TC 706 credits back to the modules where they originated using the IAT "xClaim" , "REQ54" or Credit Transfer tool.

    1. When considering claims for refund on an account that includes a TC 706 payment filed within two years, use the cycle date of the offset and not the transaction date of the offset. To determine the exact date within the cycle, refer to the Julian Date of the DLN.

    2. If an adjustment is made to abate the tax and a credit transfer is made, use the appropriate hold code and input TC 570 when appropriate. The IAT "Credit Transfer" tool contains a box for Debit Freeze and Credit Freeze and will input the TC 570 when checked.

    Reminder:

    TC 29X will release a TC 570.

    Example:

    Husband and Wife file a joint return for the AUR year. IRS assesses an additional $800 for their joint liability based on an AUR examination. Taxpayers divorce. Wife files an income tax return the subsequent year that claims a $500 overpayment. Husband does not file an income tax return for the subsequent year that claims an overpayment. Because of the outstanding AUR assessment, the $500 credit is transferred in April 201X (filing year) to the married filing joint (MFJ) tax liability for the AUR year. No other payments or credits are made to the AUR year MFJ account. On September 1, 201X (filing year or subsequent), the IRS partially abates $400 of the AUR assessment. Because all four requirements above are met, move the $100 credit that results from the partial abatement back to Wife’s subsequent year account to prevent the credit from refunding from the AUR year MFJ account.

    Example:

    Husband and Wife file a joint return for the AUR year. IRS assesses an additional $800 for their AUR year joint liability based on an AUR examination. Taxpayers divorce. Wife files an income tax return for the subsequent year that claims a $500 overpayment. Husband files an income tax return for the subsequent year that claims a $300 overpayment. Because of the outstanding AUR assessment, the $500 and $300 credits are transferred in April 201X (filing year) to the married filing joint (MFJ) tax liability for the AUR year. No other payments or credits are made to the AUR year MFJ account. On September 1, 201X, the IRS fully abates the AUR assessment. Because all four requirements above are met, move the $500 credit back to Wife’s subsequent year account and the $300 credit back to Husband’s subsequent year account before refunding to prevent the credits from refunding from the AUR year MFJ account.

    Note:

    If the payment is not moved an erroneous refund situation may occur.

  14. If the conditions in (13) above are met or if one or both TPs are deceased take the following actions:

    1. Check the entity information for the tax years involved.

    2. Verify the address is that of the TP before issuing any notice/refund.

    3. Determine if the name line changed. If the name line changed, ensure the TC 706 is placed on the correct module.

    4. Use the IAT "Credit Transfer" tool to move the TC 706 back to the correct year and module for refunding the payments.

      Note:

      If the payment is not moved to the correct tax year/module, an erroneous refund situation may occur.

  15. When considering claims for refund on an account that includes an offset such as a TC 706 payment filed within two years, use the cycle date of the offset and not the transaction date of the offset. To determine the exact date within the cycle, refer to the Julian Date of the DLN.

  16. If the TP's response results in a full or partial abatement of the AUR assessment, check TXMOD/SUMRY for collection status. If the account is in collection status 26, coordinate with the Area Office Collection Revenue Officer. Refer to SERP, WHO/WHERE link "RO by TSIGN/ZIP/STATE" (http://serp.enterprise.irs.gov/cgi-bin/ROZIP_Lookup.cgi).

4.19.3.24.5.1  (08-26-2016)
Full Adjustment Determinations

  1. If the TP provides acceptable explanations for all of the issues or there is enough information to fully reverse the AUR assessment:

    1. Input the full reversal adjustment using the IAT "xClaim" or "REQ54" tool.

      Caution:

      DO NOT use the "Full Back Out" button.

      Note:

      The adjustment automatically releases the -A freeze, if present.

    2. Use RC 068 (AUR assessment fully adjusted).

    3. Print the completed IAT "xClaim" adjustment document; Form 12249, or "REQ54" adjustment document. An adjustment document (Form 13056, Input Edit Sheet, etc.) may be used when IAT is not available.

    4. Attach the TP correspondence and any worksheets/computations to the case going to files.

      Note:

      An original Form 1040X/Amended Return must be associated with the return and should not be altered in any way. A copy of the Form 1040X can be used as a worksheet.

    5. Close the IDRS control.

    6. If the case is in BT81, assign IPC 9F.

    Note:

    The TP will receive a CP 21/CP 22 as notification of the adjustment.

  2. If TC 604 is present on the account see IRM 4.19.3.24.5 (11), Evaluating RECON Correspondence.

4.19.3.24.5.2  (09-04-2015)
Partial Adjustment Determinations

  1. If the TP provides acceptable verification for some of the issues or does not address all of the AUR issues

    1. If the TP provides a computation, rework and math verify all figures or rework based on the TP’s response. Refer to the appropriate tax year publications and worksheets for necessary schedules, EIC tables, tax tables, etc.

    2. Input a partial adjustment, including RC 067.

    3. Print the completed IAT "xClaim" adjustment document; Form 12249, or "REQ54" adjustment document. An adjustment document (Form 13056, etc.) may be used when IAT is not available.

    4. Attach the TP correspondence and any worksheets/computations to the case going to files.

      Note:

      An original Form 1040X/Amended Return must be associated with the return and should not be altered in any way. A copy of the Form 1040X can be used as a worksheet.

    5. Send the appropriate C-Letter using the IAT "Letters" tool to provide a clear explanation of what the adjustment was based on and that he/she may send any additional information for consideration.

    6. Leave a detailed case note outlining determinations made and actions taken.

    7. Assign IPC 9P when the case is in BT 81 or 83, the original AUR closure was no change and the RECON results in a change to the account.

    8. Close the IDRS control base.

  2. If TC 604 is present on the account see IRM 4.19.3.24.5 (11), Evaluating RECON Correspondence.

4.19.3.24.5.3  (08-26-2016)
No Adjustment Determinations

  1. If the TP states they do not agree with the AUR assessment, but does not provide a response or complete response including a reasonable explanation or acceptable verification:

    1. If the case is in BT 81 or 83 assign IPC 9N or 9I if requesting additional information from the TP.

    2. If the case was suspensed (i.e., in BT 82 due to assignment of IPC 9E) and the TP did not respond to the subsequent contact, assign IPC 9N.

    3. Send the appropriate C-Letter using the IAT "Letters" tool to explain why an adjustment is not being made and indicate what documentation or information is necessary, if applicable.

    4. Leave a detailed case note indicating what action was taken and/or what documentation/information was requested from the TP.

    5. Close the IDRS control base if one was established.

    6. Use RC 064 (no response) or RC 066 (disallowed in full).

  2. If TC 977/976 is present, a TC 29X will need to be input using the IAT "xClaim" or "REQ54" tool to release the "-A" Freeze on the account if an adjustment is not made. Use Blocking Series 05, 18, or 55 as appropriate.

4.19.3.24.5.4  (09-01-2013)
AUR RECON Issue Codes

  1. When taking a closing action on the AUR system (i.e., entering IPC 9F, 9I, 9N, 9P, or 9R) a drop-down menu displays with a listing of the most common RECON issues.

  2. Select the RECON issue code that most closely corresponds with the case or causes the most significant change. If the issue on the case does not relate to any of the available options, use Issue Code 28, Issue Not Listed Above. Refer to Exhibit 4.19.3-13, AUR Reconsideration Issue Codes, for additional information.

    Note:

    When using Issue Code 28, leave a case note to further explain the issue(s), action taken and to notate the requested TP information.

4.19.3.24.6  (08-26-2016)
Ordering Returns

  1. Order the tax return if information is missing or there is not enough information present to work the case.

    Example:

    The TP states the income and/or deductions were properly reported on the original return and research is inconclusive or when there is not enough information present to work the case.

  2. When ordering the tax return, use the IAT "ESTAB" tool and:

    Exception:

    Use IDRS CC RTFTP to order an E-Filed Return. A copy of the ELF return transcript can be printed and sent to the TP.

    1. Complete a history item.

    2. Suspend the case.

    3. Monitor for 30 days. If the return is not received, make a second request.

      Note:

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

    4. Check the STAUP and extend, if needed.

    5. Send the appropriate C-Letter (interim), using the IAT "Letters" tool, to the TP, as needed.

    6. Update the IDRS control base.

    7. If the case is in BT 81 or 83, transfer the case to yourself and the AUR system will assign IPC 9E.

  3. If an amended return is posted and there is an indication that it is a CIS document, view the return using AMS.

4.19.3.24.7  (09-01-2013)
Taxpayer Contact for Additional Information

  1. When the TP correspondence does not include all the necessary information to make a redetermination, take the following actions:

    1. Send the appropriate C-Letter using the IAT "Letters" tool.

    2. Assign IPC 9I and Recon Issue Code 12.

    3. Leave a detailed case note indicating what action was taken and/or what documentation or information was requested from the TP.

    4. Close the IDRS control base if one was established.

    Note:

    See IRM 4.19.3.20.2.2, Disclosure and IRM 4.19.3.20.2.2.1, Disclosure Verification Screen, when making telephone contact to ensure that disclosure procedures are followed.

4.19.3.24.8  (06-01-2015)
Payer Contact

  1. Prior to initiating payer contact, make sure the information was not verified during the original AUR case processing.

  2. If payer contact is needed:

    1. Complete a history item and update the IDRS control.

      Note:

      When suspensing a case, update your status control to "M" (monitor).

    2. Contact the payer using a Letter 2625C.

      Reminder:

      See IRM 4.19.3.20.7.5 (1), Payer Contacts, for 3rd Party Contact procedures.

    3. Send the appropriate C-Letter (interim), using the IAT "Letters" tool, to the TP, as needed.

      Note:

      If manually issuing Letter 3404C using the IAT "Letters" tool or IDRS, you must wait 10 days before issuing the Letter 2625C.

    4. Research CC STAUP and adjust the number of cycles, if needed. Refer to Exhibit 4.19.3-15, Cycle Chart (Reconsiderations).

    5. Suspend for 60 days.

    6. If the case is in BT 81 or 83, assign IPC 9L, which moves the case to BT 82 for suspense and monitoring.

  3. If the payer does not respond within the 60 day suspense, delete the income. See IRM 4.19.3.24.5.1, Full Adjustment Determinations, for a full adjustment or IRM 4.19.3.24.5.2, Partial Adjustment Determinations, for a partial adjustment.

  4. If the payer responds after the 60 day suspense and the account has already been adjusted, prepare a Form 9856, Attachment Alert using IAT "Fill Forms" tool to send the information to files.

4.19.3.24.9  (06-01-2015)
Miscellaneous RECON

  1. Manual Refunds are issued based on specific criteria. Some examples of situations when a manual refund should be issued are:

    Note:

    The IAT "Manual Refund" tool must be used to issue a manual refund.

    1. The TP requests a refund amount below one dollar.

    2. The TP is deceased and a refund is to be issued to an executor or surviving spouse. If Form 1310, Statement of Person Claiming Refund Due a Deceased Taxpayer, is not attached, correspond to request one.

    3. The refund is to be issued in a name and/or address other than the one on Master File.

    4. The account was pulled from the retention register.

    5. The case is considered a hardship, i.e., unable to meet living expenses, eviction, and other situations of similar magnitude.

  2. Adjustment Notice - If the TP requests an adjustment notice that shows the computation and assessment of accrued unrestricted interest, and/or penalties, take the following actions:

    1. Send a transcript of the account to the TP using Control D for MFTRAX or IDRS CC PINEX.

    2. Assign IPC 9I if the case is in BT 81 or 83.

  3. If, in addition to an AUR RECON request, the TP requests an installment agreement:

    1. Route the IA request to Service Center Collection Operations.

    2. Leave AUR case note "IA to Coll" or similar wording.

    3. Notify the TP that their IA request has been routed.

    4. Assign IPC 9P or 9R, as appropriate, if the case is in BT 81 or 83.

4.19.3.24.10  (09-01-2013)
Document Disposition

  1. Material that has a direct bearing on the case should be retained. Attach the documents to the adjustment (including TC 290-0).

  2. If not making an adjustment, attach the information to the original return by using IAT "Fill Forms" tool to complete Form 9856, Attachment Alert.

    Caution:

    Information cannot be attached to an ELF return.

  3. When it is necessary to associate documents to a return in files:

    1. Locate the controlling DLN. If viewing IDRS CC TXMODA, the controlling DLN of the return is associated with the TC 150 or the last adjustment DLN annotated by an "X" . If viewing IDRS CC IMFOLT, the controlling DLN is shown at the top left side of the screen. If the adjustment is "pending" it may not have a complete DLN, monitor the case until it is available.

    2. For Virtual cases, if no tax adjustment is made during AUR RECON processing - input TC 290-0, using the IAT "xClaim" or "REQ54" tool, with Blocking Series 05 to file the correspondence under its own DLN. Include RC 064 (no response) or RC 066. Enter "corr sent to files" or similar wording in the REMARKS field.

    3. Form 8453, U.S. Individual Income Tax Transmittal for an IRS e-file Return, should be refiled under their own DLN.

4.19.3.24.10.1  (09-01-2013)
Releasing Payments

  1. If not making a tax adjustment but need to release a TC 640 payment take one of the following actions:

    1. Input a TC 290-0 with Blocking Series 55, using the IAT "xClaim" or "REQ54" tool, include RC 064 (no response) or RC 066:

      Note:

      If you do not have the original filed paper return, prepare Form 2275 to attach the adjustment to the return.

    2. Do a credit transfer changing the payment from a TC 640 to a TC 670. Be sure to input Bypass Indicator 1.

      Note:

      Attach the information to the original return by using IAT "Fill Forms" tool to complete a document transmittal, Form 9856.

4.19.3.25  (09-01-2010)
Unpostable AUR Transactions

  1. Unpostable transactions are those which failed validity checks to allow them to be posted to the Master File. Unpostables that cannot be resolved by the Unpostable Function are closed to the initiating function for correction. A Form 4251 is usually generated to pull source documents from Files and return them to the initiating function.

    Reminder:

    Unpostables should be handled in a timely manner to avoid possible statute cases.

  2. Most unpostables are controlled on IDRS to the employee who input the transaction. For adjustments that were input through AUR, unpostables are controlled to IDRS number SC890NNNNN (SC = service center, NNNNN = the AUR batch number from which the adjustment was released). These controls are listed on the CCA reports (age listings). Input of STAUP and interim letters should be addressed if applicable.

  3. Unpostable Codes (UPC) identify the condition that caused the transactions to be unpostable. The Form 4251 shows the 3-digit unpostable code and a 1-digit unpostable reason code (RC) next to the unpostable code. Refer to the unpostable section in Document 6209, Section 8, IRS Processing Codes and Information, for interpretation of these codes;

    1. Find the 3-digit number in the "UPC" column.

    2. Find the 1-digit number in the "RC" column.

    3. The explanation in the corresponding "Description" column will identify the cause of the unpostable condition.

    The 3-digit unpostable code and 1-digit unpostable reason code (RC) are also listed on EONS in the GUF5547 File, Nullified Distribution Listing. This report may be queried or searched by employee number, SSN, etc.

  4. The Nullified Distribution Listings and old age listings should be monitored to ensure all unpostable transactions are resolved.

  5. Unpostables are identified on IDRS by the following Pending Transaction Identification Codes:

    • UNNN (U = unpostable, NNN = the numeric unpostable code) - This is an open unpostable case.

    • CU - Corrected Unpostable - this shows the transaction should post to the module in the cycle appearing to the right of the transaction.

    • NU - Nullified Unpostable - this case has been referred to the responsible function for correction.

    • DU - Deleted Unpostable - this case has been closed and deleted from the ECC-MTB Unpostables tape - research to determine appropriate action.

    • DN - Transaction deleted by IDRS daily TIF batch processing.

    • DJ - A transaction deleted through normal weekly updates.

    • RJ - Reject transaction - case referred to Rejects Function.

    • DC - Transaction deleted by ERS or SC Reject Processing.

    Note:

    These codes are displayed in front of the unpostable transaction. Rarely will DN or DJ impact an unpostable AUR transaction.

4.19.3.25.1  (11-04-2014)
Basic Steps for Resolving Unpostables (UP)

  1. To determine why the transaction did not post, consider the description for the UPC/RC and determine if the previous transaction was in error. See Document 6209, IRS Processing Codes and Information, for a complete list of Unpostable Codes, Reason Codes and a brief description of each.

  2. If the Form 4251 with the source document was not returned to the AUR function, attempt to resolve the issue without these items. If the unpostable was an adjustment to the account and can be resolved without the source document, complete Form 2275 to instruct Files to pull the unpostable document (DU or NU DLN) and attach it to the corrected adjustment. This is required since the DLN of the unpostable transaction will not be retained once the account is resolved. If the source document is required to resolve the unpostable condition, request the document (DU or NU DLN) using the IAT "ESTAB" tool.

  3. Take the following actions as appropriate:

    1. Review the module for freeze conditions.

    2. Examine the unpostable transaction document for other errors.

  4. If the unpostable is an adjustment to the account, attach the Form 4251 to the back of the case file and line through the incorrect DLN. On the Form 5147 (IDRS generated document that is attached to any backup material, such as the original return) carefully line through the DLN, as it should still be readable. Make a note above or next to the incorrect DLN.

  5. Use the IAT "REQ54" tool to input new adjustment with the correct information using the appropriate source tag (example, Form 12249, Adjustment Document, Form 12775, ADJ54 Adjustment Format, etc.)

    • Ensure that the new adjustment does not exceed the original assessment amount and notify the TP of the change, if applicable.

    • If the assessment went unpostable because the account had been resequenced, reinput the assessment on the new (resequenced) account. DO NOT issue a second, manual notice on any cases with a resequenced SSN.

  6. If the unpostable is a credit transfer, review both accounts/modules for erroneous refunds and/or to ensure that both sides unposted. If one side did not unpost, take to your Lead.

  7. Use the IAT "Credit Transfer" tool to reinput the credit transfer with the correct information.

  8. If the unpostable is an address change, TC 844/845, etc., (any action that would not generate a control base), reinput the transaction and then close your unpostable control base (if appropriate). These transactions may be identified on your old age listing as MFT 00 and period 0000, referring to an open control on ENMOD.

    Note:

    The IAT "REQ54" tool must be used to make the adjustment.

    Note:

    AUR Unpostable transactions should be resolved in a timely manner to ensure minimum impact to AUR and to the TP.

4.19.3.25.2  (09-01-2008)
Unpostables IDRS Command Codes

  1. Use IDRS CC UPTIN, UPDIS (UPRES), and UPCASZ to research/resolve unpostables.

  2. UPTIN: This command code displays all open unpostable cases for the input TIN. Closed unpostables for the input TIN are displayed for 3 months before dropping off IDRS. Research IDRS CC UPTIN for the following information:

    • The unpostable sequence number of an open case.

    • The case status (open, suspended, or closed).

    • The employee assignment number.

    • The corrective action taken to resolve a previously closed case, when IDRS CC UPDIS can no longer be accessed.

  3. UPDIS: This command code displays unpostable records. When IDRS CC UPDIS is input, the automatic screen display UPRES appears. Research IDRS CC UPDIS for the following information:

    1. To display a specific closed unpostable for the input sequence until the correcting action is included in the Thursday night correction tape run.

    2. The information displayed on UPDIS varies depending on the type of unpostable. IDRS CC UPDIS must also be used as a prerequisite for IDRS CC UPRES and IDRS CC UPCASZ.

    Note:

    IDRS CC UPDIS may be used via Universal Access.

  4. UPCAS: This command code is used for:

    • Requesting an MRS transcript of the unpostable record.

    • Requesting a document or return.

    • Placing or updating a case in suspense status.

    • Adding information to aid the Unpostables Function in the resolution of the unpostable condition.

      Note:

      Use IDRS CC UPCAS with the definer "Z" to input message/history information; up to 80 characters are available.

  5. For a closed case, research the UP case on IDRS CC UPTIN to determine how it was closed.

4.19.3.25.3  (08-26-2016)
Guidelines for Preventing Unpostable IDRS Transactions

  1. The following list provides guidelines for preventing unpostable transactions:

    1. Use a TXMODA or IMFOL print when making an adjustment to a TP's account.

    2. Ensure the TXMODA print is for the correct SSN and year.

    3. Do not attempt to move (credit) or remove (tax and/or penalty) for an amount larger than is shown on TXMODA print. Rounding "up" frequently results in an unpostable.

    4. Review TXMODA print for manual interest (TC 340 / TC 341). Refer to Lead if you are unable to work.

    5. Check for previous adjustments for the same amount you are adjusting.

    6. Check for and consider any previous adjustments when making your adjustment.

    7. If appropriate, input TC 570 (credit side) on credit transfers. This will help prevent an erroneous refund if the debit side goes unpostable. An alternate solution is to use Document Code 34 for credit transfers when possible. Use of Doc. Code 34 depends on the original posted transaction. This credit transfer document is considered a "two-sided" document because the credit does not attempt to post until the debit side has posted.

    8. Make sure hold codes and priority codes are used when necessary.

  2. Be especially watchful for the following transaction codes:

    • TC 160/161 - FTF penalty

    • TC 170/171 - ES penalty

    • TC 270/271- FTP penalty

    • TC 340/341- Restricted interest "-I" freeze

    • TC 420/424 or TC 576 - "-L" or unallowable issue

    • TC 768/764 - EIC

  3. Do NOT reduce the following line reference numbers below zero:

    • 878 - Primary SE Income

    • 879 - Secondary SE Income

    • 885 - Advanced EIC

    • 886 - Taxable Income

    • 889 - SE tax

    • 891 - Primary Tip Income

    • 892 - Secondary Tip Income

    • 895 - Primary Medicare Income

    • 896 - Secondary Medicare Income

    • 897 - Spousal Claim on DMF (IMF only)

    • 898 - Primary Medicare Tip Income

    • 899 - Secondary Medicare Tip Income

      Note:

      Item reference numbers 878 or 879 cannot exceed the amounts listed in the table below.

      Tax Year Money amount
      2008 $102,000
      2009 $106,800
      2010 $106,800
      2011 $106,800
      2012 $110,100
      2013 $113,700
      2014 $117,000
      2015 $118,500
  4. Additional information is available in Document 6209, IRS Processing Codes and Information, under Unpostable Codes.

4.19.3.25.4  (09-30-2014)
Guidelines for Resolving Unpostable IDRS Transactions

  1. Use the information in the table (not all inclusive) below to resolve common unpostable IDRS transactions:

    Note:

    For additional information refer to Document 6209, IRS Processing Codes and Information, under Unpostable Codes.

    CONDITION TO RESOLVE
    UPC 155-0
    A TC 29X is attempting to post to an account that is restricted from generating interest.
    Reinput the adjustment, the adjustment must include a recomputed TC 34X.

    Note:

    Use a non-restricting TC 340, whenever possible.

    UPC 158-1
    The TC 29X is within $10.00 of a previous TC 29X.
    Research to determine if the adjustment is a duplicate. If the adjustment is necessary, reinput and use Priority Code 8.
    UPC 158-1
    The account has a TC 170/171 and an adjustment to the refundable credits attempted to post without adjusting the Estimated Tax (ES) Penalty.
    Reinput adjustment and correct the ES penalty amount.
    UPC 179-0
    A TC 290/291 is attempting to post without a secondary TC 160,161, or 162 to a module containing a TC 160,161, or 162.
    1. Reinput adjustment.

    2. Include recomputed TC 160 amount.

    UPC 180-2
    An adjustment with an increase to earned income tax credit (EITC) with CRN 764 attempted to post when a previous tax adjustment already posted.
    1. Reinput adjustment.

    2. Include Priority Code 1 or 8, as applicable.

    UPC 187-0
    An adjustment is attempting to post to a module that contains an unreversed TC 780 Offer in Comprise (OIC).
    Follow Local Procedures.
    UPC 189-0
    Certain transactions attempting to post to the account are greater than the net amount on the account.
    1. Verify amounts; tax increases/decreases, credit reference numbers, adjustments are made to the appropriate TP (primary or secondary).

      Example:

      A Form 1040X is received from the TP requesting a taxable income decrease $2,500.00. TXMODA indicates the taxable income is $620.00. If an adjustment is input with CRN 886 for any amount greater than $620.00 it will unpost.

    2. Reinput adjustment.

Exhibit 4.19.3-1 
Abbreviations (also see Glossary)

The abbreviations below are not required to be used. This list is intended to offer suggested shortened forms of common terms or words only.

Acronym Definition
3rd PTY Third Party
AC Action Code
ACDS Appeals Centralized Database System
ACK Acknowledge
ACTC Additional Child Tax Credit
ADEA Age Discrimination in Employment Act
AdMT Additional Medicare Tax
ADP Automated Data Processing
AGI Adjusted Gross Income
AGN Auto-Generated Notice
AGSUB Agricultural Subsidy
AIMS Audit Information Management System
AIS Automated Insolvency System
AMRH Accounts Maintenance Research
AMSA Archer Medical Savings Account
AMT Amount
AN Auto Notice
AO Area Office
APO/FPO Address used for correspondence to overseas military personnel.
ARDI Account Receivable Dollar Inventory
ATTFE Attorney Fees
AUR Automated Underreporter
AUTH Authorized
BK Bankruptcy
BOD Business Operating Division
BPD Bureau of Public Debt
BT Batch Type
CA Case Analysis
CAF Centralized Authorization File
CC Command Code
cc Closing Code
CCC Commodity Credit Corporation
CCF Capital Construction Fund
CCISO Cincinnati Centralized Innocent Spouse Operation
CESA Coverdell Education Saving Account
CI Criminal Investigation
CIS Correspondence Imaging System
CP Computer Paragraph
CRP Conservation Reserve Program
CS Customer Service
CSN Case Sequence Number
CTR Currency Transaction Report
CUSIP Committee on Uniform Security Identification Procedures
DBTCN Cancellation of Debt
DCB Dependent Care Assistance Benefits
DIMS Docket Information Management System
DIST Distribution
DIST CD Distribution Code
DIV Dividends
DLN Document Locator Number
DOC Document
DPAD Domestic Production Activity Deduction
EAPTC Excess Advanced Premium Tax Credit
ECC-MEM Enterprise Computing Center at Memphis
ECC-MTB Enterprise Computing Center at Martinsburg
ECR Education Credit Recapture
e.g. for example
EGC Employee Group Code
EIC Earned Income Credit
EIN Employer Identification Number
EPAB Employer Provided Adoption Benefits
ES Estimated Tax
ESA Education Saving Account
ESOP Employee Stock Option Plan
ESPP Employee Stock Purchase Plan
EUR Employee Underreporter
EWPEN Early Withdrawal Penalty
EXAM Examination
EXP Expense
FICA Federal Insurance Contribution Act
FMS Financial Management Service
FMV Fair Market Value
FRC Federal Records Center
FRP Fraud Referral Program
FSC Filing Status Code
FTF Failure to File Penalty
FTP Failure to Pay Penalty
FUD Follow Up Date
GR/A Gross Pension/Annuity
HCTC Health Coverage Tax Credit
HFD Health Savings Account Funding Distribution
HSA Health Savings Account
HSTG Hostage
HQ Headquarters
i.e. that is
IA Installment Agreement
ID Identity, Identification
IDRS Integrated Data Retrieval System
IDT Identity Theft
IMF Individual Master File
IND Indicator
INEXP Investment Expense
INT Interest
IPC Internal Process Code
IR Information Return
IRA Individual Retirement Account
IRC Internal Revenue Code
IRM Internal Revenue Manual
IRMF Information Returns Master File
IRP Information Return Processing
ISO Incentive Stock Options
ISRP Integrated Submission and Remittance Processing
ISTS Innocent Spouse Tracking System
ITIN Individual Taxpayer Identification Number
IVO Integrity and Verification Operation
KIA Killed in Action
KITA Killed in Terrorist Action
LSE Lump Sum Election
LTA Local Taxpayer Advocate
LTC Long Term Care (Benefit)
MAGI Modified Adjusted Gross Income
MAMSA Medicare Advantage Medical Saving Account
MCTXW Medicare Tax withheld
MFS Married Filing Separate
MORT Mortgage Interest Deduction
MIP Mortgage Insurance Premiums
MISC Miscellaneous
ML Message Left
MSA Medical Savings Account
MT Medicare Tax
N/C No Change
NEC Nonemployee Compensation
NDDIS Non-Dividend Distribution
NIIT Net Investment Income Tax
NML No Message Left
NOD Notice of Deficiency
NOL Net Operating Loss
NQDC Non-Qualified Deferred Compensation
O/C Overclaimed
OCR Optical Character Recognition
O/D Over-deducted
OID Original Issue Discount
ORIG Original
OTINC Other Income
P/A Payer Agent
PC Process Code
PGR/COD Program/ Category of Distribution Code
PID Position Identification
PIK Payment in Kind
POA Power of Attorney
PSO Public Safety Officer
PTC Premium Tax Credit
PTP Primary Taxpayer
QCD Qualified Charitable Distributions
QDIV Qualifying Dividend
QRSC Qualifying Retirement Savings Contribution
QTP Qualified Tuition Program
RC Reason Code
RDP Registered Domestic Partner
RECON Reconsideration
ROMID Refund of Overpaid Mortgage Interest
R/R Rent/Royalty
RRB Railroad Retirement Benefits
RRTA Railroad Retirement Tax
RTAA Reemployment Trade Adjustment Assistance
RTF Return Transaction File
RV Return Values for Calculations
SBSE Small Business / Self-Employed
SBC Secondary Business Code
SC Service Center (now called Campus)
SCRIPS Service Center Recognition/Image Processing System
SE Self-Employment
SEI Self-Employment Income
SEHID Self-Employed Health Insurance Deduction
SEP Simplified Employee Pension
SERP Servicewide Electronic Research Program
SF Subfile
SITR State Income Tax Refund
SLID Student Loan Interest Deduction
SNE Special Needs Exclusion
SNOD Statutory Notice of Deficiency
SRP Shared Responsibility Payment
SS Social Security
SSA Social Security Administration
SSN Social Security Number
SS/RR Social Security/Railroad Retirement
SST Social Security Tax
SSTAX Social Security Tax and/or Railroad Retirement Tax
Stat Statutory Notice of Deficiency
STP Secondary Taxpayer
TAS Taxpayer Advocate Service
TC Transaction Code
TDA Taxpayer Delinquent Account
TE Tax Examiner
TEBND Tax Exempt Bond
TEFRA Tax Equity and Fiscal Responsibility Act
TIA Taxpayer Information Authorization
TIF Taxpayer Information File
TIN Taxpayer Identification Number
TP Taxpayer
TRDB Tax Return Data Base
TUTFE Tuition and Fees
TX/A Taxable Annuity
TXI Taxable Income
TY Tax Year
U/C Underclaimed
UID User Identification Number
UNAUTH Unauthorized
UP Unpostable
U/R Underreported; Underreporter (per context)
UVC Universal View Case
UWC Universal Work Case
W&I Wage and Investment
W/H Withholding
XFER Transfer

Exhibit 4.19.3-2 
Glossary

Agreed Case - A response from the TP with signature(s) agreeing to our changes with no comments, or full payment of tax and penalties received before issuance of the Statutory Notice of Deficiency with no comments, or a completed Installment Agreement with signature(s) and no comments.

Appealed Case - A case in which the TP requests an Appeals hearing.

Appeals Centralized Database System (ACDS) - An automated program used by Appeals to control inventory, record case activities and time charges, and produce statistical reports.

Assessments (TC 29X) - A change to the amount of tax on the TP’s account, this TC will generate a bill or a refund, a new DLN, and/or release a payment or freeze code.

AUR Received Date - A system generated date reflecting when the IRS Received Date is input on the case record.

Auto-Generated Notice Cases (AGN) - Cases systemically moved from Extract to CP 2000.

Bar Code - Contains the SSN and the tax year and is used for scanning information into the control computer, using a laser gun. It is found on the lower right corner of the Form 4251 and on several pages of notices.

Batch - Collection of returns, correspondence, or cases that have been grouped together. (Most commonly found on a truck, cart, wagon, or KC cart.)

Batch Number - Five digit number used to describe/define the type of batch and the sequential number of the batch or the physical location of the batch.

Batch Runs - Automatic updates to the entire AUR system, currently scheduled for weekends only.

Batch Status Codes - Two digit alpha codes that define the status of a batch at any given time during processing.

Batch Type (BT) - First two digits of a Batch Number that describe the type of work within the batch.

Centralized Authorized File (CAF) - Houses Power of Attorneys (POA) and other authorized disclosure contacts for TP accounts.

Case Analysis - The technical review of computer identified discrepancies compared to the tax return. The Screening phase of the Underreporter Program is referred to as either Screening or Analysis.

Case Sequence Number (CSN) - Nine digit number which indicates the exact physical location of a case.

CP 2501 - Preliminary notice sent to the TP requesting an explanation of an underreported discrepancy.

CP 2000- Notice sent to the TP with proposed changes to income, deductions, and/or credits, explanations of those changes, and a tax computation for those changes.

Disagreed Case - Response from the TP that does not agree to our proposed changes and has disputing comments attached. (Full payment received after issuance of a Statutory Notice must be considered disagreed until signature(s) are obtained.)

Docket(ed) Cases - A tax case in the U. S. Tax Court assigned a docket number. When TP files a petition with U. S. Tax Court, in response to a Notice of Deficiency, the court assigns a docket number, which is used to identify the court case.

Docket Information Management System (DIMS) - An automated program used to track and monitor receipt of docketed administrative files. The program is maintained by Appeals and is a subsystem of the Appeals Centralized Database System (ACDS) system.

Document Locator Number (DLN) - Number assigned to all returns and documents input to the IRS computer system.

Employer Identification Number (EIN) - Nine digit number formatted XX-XXXXXXX used to identify businesses/payers.

Employee Underreporter - IRS (government) employee cases in the Underreporter Program.

Extract - Group of SSNs selected from the inventory of cases identified with possible discrepancies.

Federal Record Center (FRC) - A place where tax returns are stored outside the campuses.

Form 4251 - Return Charge-out - Form generated from IDRS tape and to Files/FRC to pull the requested returns.

Individual Taxpayer Identification Number (ITIN) - assigned to individuals not qualified for a social security number.

Integrated Submission and Remittance Processing (ISRP) - Automated system that converts all paper documents to electronic form, including payments.

Integrity and Verification Operation (IVO) - Pre-refund fraud identification in Accounts Management.

Internal Process Code (IPC) - Two digit numeric/alpha code used for tracking cases on the AUR system (does not upload to IDRS).

IRS Received Date - Date the IRS received the TP correspondence or notice in the campus. It can usually be found on the first page of the receipt and is a stamp (round or square) containing the campus name and date the IRS received the correspondence in the campus.

Location Code - Three digit character code that can be alpha or numeric. It identifies the place where batches and/or cases can be found.

Lost Case (LC) - Case that cannot be located where the system indicates it should be.

Lost Response - Case is assigned to a response batch, but the response is not physically in the batch or case file.

Non-Docketed Case - A case in which the TP requests an Appeals hearing (without filing a petition with Tax Court).

Priority Responses - Responses which that are aged beyond recommended time frames, also referred to as Expedites or Early Received Date Responses.

Process Codes (PC) - Two digit numbers used to identify the action taken on a case. Process Codes reside in AUR and are uploaded to IDRS. When posted to IDRS, they update the TC 922.

Recomputed Notice (Recomp) - Notice in which the original CP 2000 figures were changed due to a TP response.

Reconsideration Cases - Responses received after the case has been closed (assessment or no change) on the AUR system, also referred to as first read, late response or audit recon cases.

Referral - Case sent to another area for technical determination (for example: Examination, Criminal Investigation, etc.).

Refile Case (RF) - Internal Process Code used to return a case to a suspense batch before further assignment.

Research - Request for additional information (returns, IDRS research, information return files, etc.) needed to continue case processing.

Response - All correspondence received from or on behalf of the TP.

Review Sampling - Cases to be reviewed by Management or quality reviewers.

Screening - Technical review of computer identified discrepancies compared against the tax return. The Screening phase of the Underreporter Program is also referred to as Case Analysis and Analysis.

Sequence Order - Order in which cases are key entered or scanned into AUR.

Social Security Number (SSN) - Used to identify TP accounts.

Statutory Notice (Stat) - Legal notification sent to TPs by Certified mail, which explains the TP's right to file a petition with Tax Court and the IRS’ right to change tax without TP consent if no timely petition is filed. An Underreporter Statutory Notice consists of a CP 3219A, Form 5564A, a partial reprint of the most recent CP 2000 and Pub 1.

Taxpayer Information File (TIF) - Individual Master File data from ECC-MTB (Enterprise Computing Center at Martinsburg) containing tax account and tax transaction information.

Taxpayer Identification Number (TIN) - Used to identify TP accounts.

User Identification Number (UID) - Three digit number assigned to an employee in order to access AUR.

Undeliverable - Correspondence returned from the Post Office that the TP did not receive.

Universal Case - Describes cases viewed or worked by a site or function other than the initiating AUR site.

Exhibit 4.19.3-3 
AUR Internal Process Codes

Pre-Notice

0A - Screening Research Request for Tax Return

0D - Miscellaneous Referral - Screening

0E - Screening Technical/Manager Referral

0P - Screening Taxpayer Advocate-Area Office-Congressional Cases/Referrals

0T - Screening Telephone

CP 2501

3A - CP 2501 Research Request - Return and/or Transcript

3D - CP 2501 Referral

3E - CP 2501 Technical/Manager Referral

3F - CP 2501 Fraud Referral

3L - CP 2501 AUR Correspondex Letter

3P - CP 2501 Taxpayer Advocate-Area Office-Congressional Cases/Referrals

3S - CP 2501 Phone Call/Manual Letter (letter not on AUR)

3T - CP 2501 Telephone (Request Case)

CP 2000

6A - CP 2000 Research Request - Return and/or Transcript

6D - CP 2000 Referral

6E - CP 2000 Technical/Manager Referral

6F - CP 2000 Fraud Referral

6L - CP 2000 AUR Correspondex Letter

6P - CP 2000 Taxpayer Advocate-Area Office-Congressional Cases/Referrals

6S - CP 2000 Manual Letter (letter not on AUR)

6T - CP 2000 Telephone (Request Case)

6X - CP 2000 Extension Request

Statutory Notice

8A - Statutory Research Request - Return and/or Transcript

8D - Statutory Referral

8E - Statutory Technical/Manager Referral

8F - Statutory Fraud Referral

8L - Statutory AUR Correspondex Letter - No Revision to Deficiency

8M - Statutory AUR Correspondex Letter - Change to Deficiency

8P - Statutory Taxpayer Advocate - Area Office-Congressional Cases/Referrals

8S - Statutory Phone Call/Manual Letter (Letter not on AUR)

8T - Statutory Telephone (Request Case)

Miscellaneous - Open Cases

LC - Lost Case

MC - Manual Case

MI - Manual Interest

RC - Restore Case

RF - Refile Case

RN - Recomputation Notice Case (Indicators 7 and 8 Only)

SR - Statutory Recomputation Notice (Indicators 0, 7 and 8 Only)

WP - Wrong Pull

Identity Theft

SI - Stolen Identity

S3 - Statutory Notice - Only One TP Signature on Consent (releases AUR Correspondex Letter and moves case to BT 89004 suspense)

S6 - CP 2000 Only One TP Signature on Consent (releases AUR Correspondex Letter and moves case to BT 89005 suspense)

S8 - Statutory Notice - Only One Spouse Files Petition (moves case to BT 89006 suspense)

S9 - Reserved

Reconsideration - Closed Cases

9B - Referral

9E - RECON Research/Referral within AUR - suspense

9F - RECON Full Abatement of the AUR assessment - closure

9I - RECON Information Request/MISC - closure

9L - RECON Payer Letter - suspense

9N - RECON No change to AUR assessment - closure

9P - RECON Partial adjustment - closure

9R - RECON Referral non-AUR issue - closure

Exhibit 4.19.3-4 
AUR Process Codes

U/R Case Selected

01 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

02 - Reserved

03 - AUR selected case

04 - Reserved

06 - AUR Employee Cases

08 - Reserved

09 - Establish IDRS Control Base - CP 2000 Interest Pending

Pre-Notice Transfer/Referral/Closures

10 - DUP TIN closure

11 - Field Audit

12 - Office Audit

13 - Campus Examination

14 - ≡ ≡ ≡ ≡

15 - Military Action/Disaster Closures

16 - HQ Identified Program Problem - Closure

17 - IDT VA

18 - KITA/HSTG/KIA Closures

Pre-Notice Closures

20 - Adjustment for W/H and/or excess SSTAX discrepancies only

21 - Discrepancy accounted for

22 - Balance due/Refund below tolerance

23 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

24 - Payer Agent

25 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

26 - Open TC 420 or TC 30X

27 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

28 - Other Closure

29 - Return cannot be secured

CP 2501 Notice - Transfer/Referral/Closure

30 - CP 2501 (establishes IDRS Control Base)

34 - CP 2000 not mailed after a CP 2501 (PC 57)

35 - Case closed to Field Audit (Acknowledgement letter, CP 2006)

36 - Case closed to Office Audit (Acknowledgement letter, CP 2006)

37 - Reserved

38 - Case Closed to Campus Exam (Acknowledgement letter, CP 2006)

44 - ≡ ≡ ≡ ≡ ≡

46 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

47 - No change (closure letter CP 2005)

48 - HQ Identified Program Problem (closure letter CP 2005)

51 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

52 - No change (no closure letter)

53 - Amended return closed case (no closure letter)

54 - Notice CP 2501 not mailed

CP 2000 Notice - Transfer/Referral/Closure

55 - CP 2000 (establish IDRS Control Base)

56 - Reserved

57 - CP 2000 after CP 2501

58 - CP 2000 Notice not mailed

59 - Recomputation (updates IDRS Control Base)

60 - Amend/Recomp not mailed (PC 59 and amended PCs 55, 57 and 59)

61 - Reserved

63 - Case closed to Office Audit (Acknowledgement letter, CP 2006)

64 - Case closed to Campus Exam (Acknowledgement letter, CP 2006)

65 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ (no acknowledgement letter)

66 - Disagreed - Appeals Request - to Campus Examination (no acknowledgement letter)

67 - Fully Agreed (no closure letter)

68 - Adjustment to Prepayment Credits Only closures (no closure letter), Partial Adjustments

69 - TPs Agreed on Different Dates - Account Split

70 - No change to original tax liability (closure letter, CP 2005)

71 - No change to original tax liability closure (and HQ Identified Program Problem) (no closure letter)

72 - ≡ ≡ ≡ ≡ ≡

73 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ (closure letter, CP 2005)

74 - Other closure (closure letter, CP 2005)

Statutory Notice - Transfer/Referral/Closure

39 - One TP Agreed at a Later Date - Account Split

62 - Non-petitioning Spouse Agreed

75 - Statutory Notice - Updates IDRS Control Base

76 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ (no acknowledgement letter)

77 - Statutory Notice - STN90 (computation change - not generated, input via IDRS CC STN90)

78 - Statutory Notice Rescinded

79 - Statutory Notice not mailed

80 - Transfer Docketed Cases to Appeals (no acknowledgement)

81 - Recomp not mailed after Statutory Notice (PC 95)

82 - Non-petitioning Spouse Default

83 - Statutory case closed to Office Audit (Acknowledgement letter, CP 2006)

84 - ≡ ≡

85 - Statutory case closed to Campus Exam (Acknowledgement letter, CP 2006)

86 - Disagreed Statutory Case - Appeals Request

87 - Fully Agreed (no closure letter)

88 - Adjustment to Prepayment Credits Only closures (no closure letter) and Employee Case Partially Agreed

89 - One TP Agreed - Case Defaulted - Account Split

90 - Assessed by default

91 - No change to original tax liability (closure letter, CP 2005)

92 - No change to original tax liability (no closure letter)

93 - ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

94 - Default assessments based on revision(s) to Statutory Notice

95 - Statutory Recomputation Notice

96 - Other Closure (closes AUR system control, used for manual monitoring of active Bankruptcy cases or referral of non-bankruptcy cases to another area, etc.)

Miscellaneous

97 - Response received - Correspondence sent for additional information

98 - Bankruptcy Suspense (also applicable for Employee cases)

99 - Innocent Spouse Suspense (also applicable for Employee cases)

Exhibit 4.19.3-5 
Batch Types

BATCH TYPES 01-19 - SCREENING ASSOCIATION

BATCH TYPES 20-27 - AUTO NOTICE

BATCH TYPE 28 - AUTO NOTICE FALLOUT SCREENING

BATCH TYPE 29 - PRIORITY SCREENING

BATCH TYPE 30 - MISSING RETURN SUSPENSE

BATCH TYPE 31 - COMPLETE SCREENING CASES

BATCH TYPE 32 - MISSING DATA SUSPENSE

BATCH TYPE 33 - SCREENING REFERRAL/RESEARCH COMPLETE

BATCH TYPE 34 - SCREENING RESEARCH SUSPENSE

BATCH TYPE 35 - SCREENING MISCELLANEOUS REFERRALS

BATCH TYPE 36 - SCREENING UNIT SUSPENSE

BATCH TYPE 37 - RELEASED UNIT SUSPENSE

BATCH TYPE 38 - REMAIL CP 2000/RECOMP

BATCH TYPE 39 - REJECTS

BATCH TYPE 40 - CP 2501 SUSPENSE

BATCH TYPE 41 - CP 2501 RESPONSE

BATCH TYPE 42 - CP 2501 UNIT RESEARCH SUSPENSE

BATCH TYPE 43 - CP 2501 MISCELLANEOUS REFERRAL

BATCH TYPE 44 - CP 2501 PRIORITY RESPONSE

BATCH TYPE 45 - CP 2501 UNIT SUSPENSE

BATCH TYPE 46 - CP 2501 RESPONSE RELEASE

BATCH TYPE 47 - CP 2501 LETTER SUSPENSE

BATCH TYPE 49 - AGED CP 2501CP 2000 PREPARATION

BATCH TYPE 50 - CP 2000 SUSPENSE

BATCH TYPE 505XX - CP 2000 SUSPENSE FOR AUTO-GENERATED NOTICE CASES

BATCH TYPE 51 - CP 2000/RECOMP AGREED RESPONSE

BATCH TYPE 52 - CP 2000/RECOMP DISAGREED RESPONSE

BATCH TYPE 53 - CP 2000/RECOMP PRIORITY RESPONSE

BATCH TYPE 55 - RECOMPUTED CP 2000 SUSPENSE

BATCH TYPE 58 - LATE CP 2000 RESPONSES/STATUTORY NOTICE GENERATED

BATCH TYPE 59 - AGED CP 2000 STATUTORY NOTICE PREPARATION

BATCH TYPE 60 - CP 2000 LETTER RESPONSE

BATCH TYPE 61 - MANUAL INTEREST REJECTS

BATCH TYPE 62 - CP 2000 UNIT RESEARCH SUSPENSE

BATCH TYPE 63 - CP 2000 MISCELLANEOUS REFERRAL

BATCH TYPE 65 - CP 2000 UNIT SUSPENSE

BATCH TYPE 66 - CP 2000 RESPONSE RELEASE

BATCH TYPE 67 - PARTIAL AGREEDS

BATCH TYPE 68 - MANUAL STAT NOTICE PREP

BATCH TYPE 70 - STATUTORY NOTICE SUSPENSE

BATCH TYPE 71 - STATUTORY AGREED RESPONSE

BATCH TYPE 72 - STATUTORY RESPONSE

BATCH TYPE 73 - STATUTORY REFERRAL MISCELLANEOUS REFERRAL

BATCH TYPE 74 - STATUTORY PRIORITY RESPONSE

BATCH TYPE 75 - STATUTORY UNIT SUSPENSE

BATCH TYPE 77 - STATUTORY UNIT RESEARCH SUSPENSE

BATCH TYPE 79 - STATUTORY DEFAULTS

BATCH TYPE 81- RECONSIDERATION - These batches are used for controlling and tracking RECON cases on the AUR system.

BATCH TYPE 82 - RECONSIDERATION UNIT SUSPENSE

BATCH TYPE 83 - EMPLOYEE RECONSIDERATION - These batches are used for controlling and tracking employee RECON cases on the AUR system.

BATCH TYPE 84 - CASES WITH NEW ACTIONS - These are cases the system has identified with new actions since batches or cases were released by the tax examining units. The batch is divided as follows:

Batch Segments Definitions
84001-84299 Screening Cases with New Actions
84300-84499 CP 2501 Cases with New Actions
84500-84799 CP 2000 Cases with New Actions
84800-84999 Statutory Notice Cases with New Actions

These batches are available for assignment to the tax examining units upon request.

BATCH TYPE 85 - REMAIL STATUTORY NOTICES

BATCH TYPE 86 - STATUTORY RESPONSE RELEASE

BATCH TYPE 87 - PARTIAL AGREED STATS

BATCH TYPE 89001 - BANKRUPTCY SUSPENSE

BATCH TYPE 89002 - INNOCENT SPOUSE SUSPENSE

BATCH TYPE 89003 - IDENTITY THEFT SUSPENSE BATCH

BATCH TYPE 89004 - STATUTORY SUSPENSE ONLY ONE TP SIGNATURE ON CONSENT

BATCH TYPE 89005 - CP 2000 SUSPENSE ONLY ONE TP SIGNATURE ON CONSENT

BATCH TYPE 89006 - STATUTORY SUSPENSE ONLY ONE TP FILED PETITION

BATCH TYPE 90 - EMPLOYEE SCREENING

BATCH TYPE 91 - EMPLOYEE SUSPENSE

BATCH TYPE 92 - EMPLOYEE UNIT SUSPENSE

BATCH TYPE 93 - DECLARED DISASTER - Cases identified, usually by the system, as meeting disaster criteria are built into BT 93. These cases remain in BT 93 until the system expiration date is met and the next action can be taken on the case. Cases meeting disaster criteria are built into BT 93 as follows:

Batch Segments Definitions
93001-299 Screening
93300-399 CP 2501
93400-699 CP 2000
93700-799 CP 2000 Statutory Prep
93800-899 Stats
93900-999 Default Holds

BATCH TYPE 94 - FRAUD SUSPENSE

BATCH TYPE 95 - REVIEW - There are five types of review batches:

Batch Segments Definitions
95001-199 Reserved
95200-399 CP 2000 Notice Review
95400-499 Reserved
95500-599 CP 2000 Sort Code/Override Review
95600-799 Pre-Statutory Notice Review
95800-999 Statutory Recomp/Sort Code Review

BATCH TYPE 96000 - CLOSURE SUSPENSE

BATCH TYPE 96002 - CLOSURE SUSPENSE AFTER RECONSIDERATION

BATCH TYPE 97 - RESERVED

BATCH TYPE 98 - LOST CASE SUSPENSE

BATCH TYPE 99 - UNASSOCIATED RESPONSE SUSPENSE

Exhibit 4.19.3-6 
Category of Distribution (COD) Chart - Form 1099-R

No Code - Normal Distribution from plans other than an IRA or SEP (Form 1099-R ONLY)

1 - Early (Premature) Distribution, no known exception

2 - *Early (Premature) Distribution, exception applies

3 - *Disability

4 - *Death

5 - Prohibited Transaction (such as borrowing or using as loan security)

6 - Section 1035 Exchange (tax-free)

7 - Normal Distribution

8 - Excess Contributions Refunded plus Earnings (taxable)

9 - Cost of life insurance (taxable)

A - May be eligible for 10-year tax option (Form 4972)

B - Designated Roth account distribution (not a qualified distribution)

D - Annuity payments from nonqualified annuities that may be subject to tax under section 1411

E - *Excess Annual Additions under Section 415 and Excess Section 403b amounts (taxable)

F - Charitable gift annuity

G - *Direct rollover to a qualified plan, tax sheltered annuity, a governmental 457(b) plan or IRA.

H - *Direct rollover of a designated Roth account distribution to a Roth IRA.

J - Early Distribution from a Roth IRA - no known exception

K - Distribution of IRA assets not having a readily available FMV.

L - Loans treated as distributions

N - Recharacterized IRA contribution made for current year

P - Excess Contributions plus earnings/excess deferrals taxable in prior year

Q - *Roth IRA qualified distribution

R - Recharacterized IRA contribution (made for prior year and recharacterized for current year)

S - Early distribution from a SIMPLE IRA in first two years - no known exception

T - Roth IRA distribution - exception applies

U - Dividend distribution from ESOP under sec 404(k)

W - Charges or payments for purchasing qualified long-term care insurance contracts under combined arrangements

Note:

*designates Form 5329 not required

The following are reserved for Railroad Retirement Board's use:

Code Definition
V- RRB Vested Dual Benefit (Windfall)
X - RRB Tier 1
Y - RRB Tier 2
Z - RRB Supplemental

Exhibit 4.19.3-7 
CP PARAGRAPHS

Some numbered paragraphs listed below do not appear within the IRM. These paragraphs are system generated within the body or specific area of the notice sent.

Note:

The verbiage in the following paragraphs matches what is in the data base for the most current AUR year. The verbiage for previous years may vary slightly and will reflect the impacted AUR year.

2 - Wages reported incorrectly The wages reported on your tax return were taken from the wrong box on Form(s) W-2, Wage and Tax Statement.

3 - Capital gains distributions The amount of capital gain distributions shown on your Schedule D, Capital Gains and Losses, was not included on page 1 of your tax return.

4 - Qualified dividends Our records indicate that you may be eligible for a lower tax rate since the Dividends reported to us contain Qualified Dividends. Please respond and tell us of any needed changes to the eligible Qualified Dividends reported.

5 - Real estate transaction Our records show that you sold or transferred real estate during 2014. However, your tax return does not show this transaction. The gain from real estate transactions, in excess of any applicable exclusion amount, must be reported on your tax return for the year the transaction(s) occur. Refer to Publication 523, Selling Your Home, for information regarding applicable exclusions and the correct forms or schedules needed to report the sale. Refer to Publication 544, Sales and Other Dispositions of Assets, for information regarding the correct forms or schedules needed to report the disposition of other types of assets. Please complete the appropriate form(s) or schedule(s) and provide them to us along with:

  • Verification of your cost or adjusted basis in the property,

  • The date the asset was acquired for each Form 1099-S, Proceeds From Real Estate Transactions, transaction shown on this notice.

  • A statement as to how you used each property, e.g. personal residence, second home, rental, investment or business use.

6 - Withholding credit not given due to joint ownership We can't allow withholding credits on jointly owned income without more information on the allocation. Please send the names and social security numbers of the other joint owners and a breakdown of the income and tax withheld that each joint owner reported.

7 - Schedule A miscellaneous deductions percentage limitation Miscellaneous deductions are reduced by 2% of your adjusted gross income. Since we refigured your adjusted gross income, we also refigured your miscellaneous deduction.

8 - AGI decrease - Early withdrawal of interest savings penalty Your payers charged you a penalty when you withdrew your savings early. This penalty can be claimed as an adjustment on your return to reduce your Adjusted Gross Income (AGI).

9 - Your Standard Deduction is now larger than your Itemized Deductions The Standard Deduction amount is now larger than your total Itemized Deductions on Schedule A, line 29. As a result, the proposed Taxable Income amount in the "Changes to your tax return" section of this notice was refigured using the Standard Deduction rather than your Itemized Deductions.

10 - Schedule A medical and dental expenses percentage limitation Medical and dental expense deductions are reduced by 10% (7.5% if you or your spouse is age 65 or older) of your adjusted gross income. Since we refigured your adjusted gross income, we also refigured your medical and dental expense deduction.

11 - 10% additional tax on premature distributions from a qualified retirement plan Premature distributions from a qualified retirement plan are subject to a 10% additional tax. A distribution is considered premature if it was paid before you reached age 59 1/2. Exceptions may apply as indicated in Publication 17, Your Federal Income Tax (For Individuals), or Publication 590, Individual Retirement Arrangements. If the distribution(s) shown on this notice are exempt from the 10% additional tax, please send us a signed explanation.

12 - Employment status determination Our records show that you were paid as an independent contractor, subject to self-employment tax. If you disagree, please complete and return Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, along with the Response Page of this notice. To expedite processing, please write "AUR" along the top of the Form SS-8.

13 - Credit for the Elderly or Disabled The Credit for the Elderly or Disabled is based on earned income and adjusted gross income. This credit cannot be more than your tax. Since we adjusted your income and tax, we also adjusted the amount of the Credit for the Elderly or the Disabled claimed on your tax return.

14 - Gambling losses on Schedule C Gambling winnings and any related expenses/gambling losses can only be reported on Schedule C, Profit or Loss from Business, when gambling activity is pursued full time for the production of income for livelihood. We have disallowed the expenses/gambling losses claimed on Schedule C and adjusted your self-employment tax accordingly. Gambling losses, that are no greater than the amount of your reported gambling winnings, can be claimed as an itemized deduction on Schedule A.

15 - Penalty for not reporting tip income to your employer We charged a penalty because, according to our records, you didn't report your tips to your employer. This penalty is charged if you received tips of $20 or more in a single month while working for any one employer. The penalty is 50% of the Social Security and Medicare Tax you owe on your tip income. If you think we should not charge this penalty, please write to us and tell us why. We will determine if there is reasonable cause to waive the penalty. (Internal Revenue Code section 6652(b))

16 - Reduction to income because of your state or local income tax refund Because you didn't claim any itemized deductions for state and local taxes, on your 2013 federal tax return, you don't have to report any of the refund for state or local taxes as income on your 2014 federal tax return.

17 - Self-Employment Tax on Self-Employment (SE) income Self-Employment (SE) income generally includes nonemployee compensation, merchant card, third party network payments, and other income from part-time or full-time work and is subject to Self-Employment Tax. We figured the Self-Employment Tax on the net SE income reported on your return and/or on the underreported SE income.

Self-Employment Tax consists of Social Security Tax of 12.4% and Medicare Tax of 2.9% and for SE income in excess of certain thresholds based on your filing status, an Additional Medicare Tax of 0.9%. (Even if you have paid the maximum amount of Social Security Tax, you are still liable for additional Medicare Tax, if over the applicable threshold.) The deductible part of the Self-Employment Tax is based on the change we made to your Self-Employment Tax. If you were an employee, you will be liable for income tax and the employee's share of Social Security (6.2%) and Medicare taxes (1.45%). Your social security account will be credited with the amount of Self-Employment income shown on this notice.

18 - Self-Employment Tax decrease Based on the amount of social security tax paid on your wage income, we decreased the amount of self-employment tax owed on your self-employment income.

19 - Earned Income Credit The allowable amount of earned income credit is based on your earned income and adjusted gross income (AGI) both of which must be less than:

- $14,950 with no qualifying child ($20,020 for married filing jointly),

- $38,511 with one qualifying child ($43,941 for married filing jointly) or

- $43,756 with two qualifying children ($49,186 for married filing jointly).

- $46,997 with more than two qualifying children ($52,427 for married filing jointly).

Changes to your AGI will impact your allowable Earned Income Credit.

20 - Potential adjustment of non-refundable credits You included unused non-refundable credits on your tax return. Please review your tax return to determine if, based on our proposal, the IRS needs to adjust any of these credits. In order to claim additional unused non-refundable credits, send us a signed statement showing the additional unused credits you want to use. If you have already applied the unused credits to another tax year, you need to file a Form 1040X, Amended U.S. Individual Tax Return, for the other year with the appropriate Internal Revenue Service Center. If the tax return for the affected period has not yet been filed, confirm with a signed statement that your records have been corrected.

21 - Schedule A casualty and theft loss deduction percentage limitation Casualty and theft losses must be reduced by $100 and then exceed 10% of your adjusted gross income. Since we refigured your adjusted gross income, we have refigured your casualty and theft loss deduction.

22 - Student loan interest deduction is not substantiated Please provide us with documentation for the amount of student loan interest deduction you claimed on your return. You can provide Form 1098-E, Student Loan Interest Statement, or a similar document from a lender, showing the amount that was claimed as a student loan interest deduction.

23 - Student loan interest deduction decreased We decreased the student loan interest deduction you claimed on your tax return because your modified adjusted gross income is between:

- $65,000 and $80,000 for taxpayers filing Single, Head of Household or for a Qualifying Widow(er) with a dependent child

- $130,000 and $160,000 for Married Taxpayers Filing Jointly.

There is no allowable deduction if:

  • your modified adjusted gross income exceeds the higher amount listed above for your filing status

  • your filing status is Married Filing Separately

  • you indicated that you can be claimed as a dependent on someone else's tax return

The allowable deduction amount for your filing status and income is shown in the "Explanation of changes" section of this notice under the heading "Reported to IRS by others" .

24 - Capital gains loss ($3,000/$1,500) limitation The capital gains and/or securities (sale of stock) shown on this notice were treated as ordinary income because of the loss limitations on your Schedule D. If you wish to apply the loss to this income and you have any unused losses on your original Schedule D, you must acknowledge that other affected tax years will be corrected. In response to this notice:

- Send an amended Schedule D

- To correct other affected tax returns for years that have already been filed, submit a Form 1040X, Amended U. S. Individual Income Tax Return, to the appropriate Internal Revenue Service Center.

If the tax return for the affected year has not yet been filed, confirm with a signed statement that your records will be corrected. The $3,000 limitation on the deduction is reduced to $1,500 if you are married and file a separate return.

25 - Sick pay Sick pay is taxable if it is paid directly by your employer, from a benefit fund, or from an employer-paid insurance plan. However, payments you received based on income insurance premiums you paid are not taxable. If you paid premiums for the income insurance plan provided by your employers, send us a signed payer statement explaining the portion of the total premium you paid.

26 - Exemption deduction reduced We reduced the exemption deduction claimed on your return because your adjusted gross income (AGI) is more than the allowable amount for a full deduction:

  • $254,200 for filing status Single

  • $305,050 for filing status Married Filing Jointly or Qualifying widower

  • $152,525 for Married Filing Separately

  • $279,650 for Head of Household

Once your AGI exceeds the amount shown above for your filing status, the allowable exemption deduction is reduced.

27 - Overclaimed withholding Our records indicate you are entitled to a lesser amount of withholding and/or Additional Medicare Tax withholding than the amount claimed on your tax return. Please send us a copy of Form(s) W-2, Wage and Tax Statement, 1099, and/or other withholding documentation from the payer(s) to verify the additional withholding claimed on your tax return.

28 - Underclaimed withholding Our records indicate you may be entitled to a larger amount of withholding and/or Additional Medicare Tax withholding than you claimed on your tax return. Please review the payer information provided in this notice with your records. If this payer information is incorrect, please provide a statement so that we can correct our records. If this payer information is correct, please respond to this notice so that we may make the necessary adjustments to your account.

29 - Self-Employment Tax - optional method Under the optional method, self-employment tax is not figured on more than $5,198 of net earnings.

30 - Contributions to Roth or Education IRA Contributions to a Roth IRA or Coverdell Savings Account cannot be deducted as an adjustment to income. Only contributions to a traditional IRA can be deducted as an adjustment to income. For more information, please see Form 1040, U.S. Individual Income Tax Return, instructions or Publication 17, Your Federal Income Tax (for Individuals), Chapter 17.

31 - Payments from qualified education programs Generally, earnings from Qualified Tuition Programs (QTPs) or Coverdell Education Savings Accounts (CESAs), are tax exempt if they are used to pay expenses for qualified education, transferred between trustees, or rolled over to another qualified education program within 60 days. Earnings on any such distributions not used for the above purposes are included in income. Most taxable earnings are also subject to an additional 10% tax. Please see Publication 970, Tax Benefits for Education, for more information. If you believe that all or part of the QTP or CESA earnings qualify for tax-exemption, please send us a signed statement showing the qualified expenses or rollover documentation, or the computation that was used to determine the taxable portion.

32 - Joint liability for tax Since you filed a joint return, you and your former spouse are jointly and separately liable for the full amount of any deficiency. We will send your former spouse a copy of the proposed adjustment if you send us his/her address.

33 - Schedule A general sales tax deduction Based on our proposed changes to your income, you may be entitled to claim additional state and local sales taxes. If you are entitled to an additional state and local tax deduction, please provide us with a signed statement showing the amount of the additional deduction that you are entitled to claim.

34 - Borrowing from pension/annuity plan Money borrowed from an employer's qualified pension or annuity plan may have to be treated as a distribution. If the borrowed amount is reported on Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., with a Distribution Code L, the loan is fully taxable and does not qualify for rollover treatment.

35 - Failure-to-file penalty When you file your tax return after the due date, we charge a penalty of up to 5% of the unpaid tax per month for no more than 5 months or up to 25% of the unpaid amount. If the return is more than 60 days late, we may charge the minimum of $135 or 100% of the unpaid tax, whichever is less. We count part of a month as a full month. (Internal Revenue Code section 6651(a)(1)).

If you believe we should reduce or waive this penalty, please send us a signed statement explaining why you filed your tax return late. We will review your explanation and determine if you had reasonable cause for filing late.

36 - Additional Child Tax Credit disallowed Since we changed your income and tax, the full amount of Child Tax Credit for your filing status and modified adjusted gross income is included in our proposed changes. As a result, you are no longer eligible for the Additional Child Tax Credit.

37 - Additional Child Tax Credit adjusted - Schedule 8812 Since we changed your income and tax, we adjusted the allowable amount of Additional Child Tax Credit.

38 - American Opportunity Credit The American Opportunity Credit claimed on your tax return has been decreased or eliminated because we changed your modified adjusted gross income (MAGI). The phase-out of the credit begins when your MAGI exceeds $80,000 ($160,000 if married filing jointly) and is eliminated completely when your MAGI reaches or exceeds $90,000 ($180,000 if married filing jointly).

39 - Self employment tax on other income We figured self-employment tax on the income reported on Form 1040, line 21. Self-employment income generally includes nonemployee compensation and other income from part-time or full-time work. If the line 21 amount isn't subject to self-employment tax, provide a signed statement indicating why and include any supporting documentation.

40 - Your mortgage interest deduction needs verification The mortgage interest deduction and points claimed on your return were more than the amount your lender(s) reported to us on Form(s) 1098, Mortgage Interest Statement. Please provide copies of the documents used to support the amounts claimed on Form 1040:

- Schedule A, line 10

- Schedule C, line 16a

- Schedule E, line 12

- Schedule F, line 21a

- Form 4835, line 19a and/or

- Form 8829, line 10

41 - Substitute payments in lieu of dividends and interest You cannot report substitute dividend or interest payments your broker receives on your behalf as dividends or interest (including tax-exempt interest) on your tax return. You must report these payments as ordinary income on your tax return.

42 - Gambling losses The law allows you to claim gambling losses, no greater than the amount of your reported gambling winnings as a miscellaneous itemized deduction on Schedule A, Itemized Deductions.

- If you did not file a Schedule A and your total itemized deductions, including allowed gambling losses, exceed your standard deduction amount, it may benefit you to complete and send us a Schedule A claiming those deductions.

- If you did file a Schedule A and your total itemized deductions, including allowable gambling losses, were more than the standard deduction amount, we entered your gambling losses on Schedule A to reduce your taxable income.

43 - Failure-to-pay penalty When you pay your taxes after the due date, we charge a penalty of 0.5% of the unpaid amount due per month, up to 25% of the amount due. We count part of a month as a full month. (Internal Revenue Code Section 6651)

If this penalty applies, we will bill you for this amount at a later date. The bill may reflect the amount as unpaid interest. Payments are applied first to the tax you owe, then penalties, and then interest.

44 - Stocks or bonds We recalculated your tax by including your capital gains and losses from the sale of your stocks or bonds on Form 1040, Schedule D, Capital Gains and Losses.

45 - Minister's expenses on Schedule C Expenses claimed on Schedule C, Profit or Loss from Business, should have been claimed on Form 2106, Employee Business Expenses, and reported as an itemized deduction on Schedule A. As a result, your self-employment tax may be adjusted. For more information, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers.

46 - Double exclusion of line of duty injury income Our records show the amount of income related to your injury in the line of duty reported on your Form W-2, Wage and Tax Statement, has already been excluded from your gross wages. You cannot exclude it again on your return.

47 - Amended information from your payer(s) This notice reflects the new or amended information we received from your payer(s) or employer(s).

48 - Credit for child and dependent care expenses The credit for Child and Dependent Care Expenses is based on your child and dependent care expenses, your earned income, adjusted gross income and dependent care benefits received from your employer. The credit cannot be more than your tax. Since we changed your income and tax, we also changed the amount of your credit for Child and Dependent Care Expenses, Form 2441.

49 - Withholding from retirement distribution is taxable Although your tax return showed that your entire retirement distribution was rolled over, the payer withheld an amount for taxes. Payers may withhold amounts for taxes, when the taxpayer withdraws money from the account. Unless you replaced the amount with money from another source and you rolled over the entire distribution, the withholding amount is considered taxable. We adjusted your records and as a result you owe additional tax.

50 - Distributions from a nonqualified plan Distributions from a nonqualified deferred compensation plan or a nongovernmental section 457(b) plan are taxable in the year received. As a result, you cannot reduce your Form W-2, Wage and Tax Statement, box 1, Wages, tips, other compensations, by the amount reported in box 11, Nonqualified plans.

51 - Early distributions taxable as income Although the 10% tax on early distribution(s) was reported on Form 5329, Additional Taxes on Qualified Plans (including IRAs) and Other Tax-Favored Accounts, the distribution must also be reported as income on page 1 of your tax return.

52 - Ordinary dividends do not qualify for capital gains treatment The dividends reported on Form 1040, line 13 or Schedule D, Capital Gains and Losses, do not qualify for capital gains treatment. Your payers reported these dividends to us as ordinary dividends, so you must report them as ordinary income on your tax return.

53 - IRA deduction exceeds age limitation or earned income If under age 50 at the end of the year, the deduction amount for IRA contributions cannot exceed the lesser of:

- $5,500 or your earned income for filing status Single, Married Filing Separately or Head of Household

- $11,000 or your earned income for filing status Married Filing Jointly, even if only one spouse had earned income.

If age 50 or older at the end of the year, the deduction amount for IRA contributions cannot exceed the lesser of:

- $6,500 or your earned income for filing status Single, Married Filing Separately or Head of Household

- $13,000 or your earned income for filing status Married Filing Jointly, both spouses are age 50 or older

- $12,000 or your earned income for filing status Married Filing Jointly, only one spouse is age 50 or older.

Contributions to a traditional IRA cannot be made or deducted for the year you reach age 70 1/2 or any later year. If you or your spouse were covered by a retirement plan through your employer, the deduction could be further limited. Regardless of age, an IRA deduction is only allowed if you have earned income and is limited to the lesser amount of either your IRA contribution or the amount of your earned income.

54 - Limit on Schedule A, Itemized Deductions We changed the amount claimed for itemized deductions because your adjusted gross income (AGI) exceeds:

  • $305,050 for filing status Married Filing Joint

  • $279,650 for filing status Head of Household

  • $254,200 for filing status Single

  • $152,525 for filing status Married Filing Separately

Once your AGI exceeds the amounts shown above, limitations are imposed on the itemized deductions that you can claim. The proposed change is reflected in the itemized deduction amount shown "Changes to your tax return" section of this notice.

55 - Archer or Medicare MSA distributions/Long Term Care benefits - Form 8853 We need more information to determine the taxable amount of the Archer Medical Saving Account, or Medicare Advantage MSA distribution or Long Term Care benefits shown on this notice. Please complete and return Form 8853, Archer MSAs and Long Term Care Insurance Contracts.

56 - Credit for qualified retirement savings contributions The Credit for Qualified Retirement Savings Contributions, Form 8880, claimed on your return has been adjusted for one or more of the following reasons:

- The retirement distribution(s) claimed on your return have been changed.

- The IRA deduction claimed on your return has been changed.

- The additional income shown on this notice has limited the credit because your new modified adjusted gross income (MAGI) is between: $18,000 - $30,000 for filing status single, married filing separately or qualifying widow(er), $27,000 - $45,000 for filing status head of household, or $36,000 - $60,000 for filing status married filing jointly. The credit is eliminated when MAGI exceeds the upper limit.

For more information, please see the instructions for Form 8880, Credit For Qualified Retirement Savings Contributions.

57 - Interest and/or dividend income The amount(s) of interest and/or dividend income reported on your Schedule B was not included as income on page 1 of your tax return.

58 - Education credits Since we changed your income and tax, we also adjusted the amount of the education credits (American Opportunity and Lifetime Learning Credits) on your tax return.

59 - Recompute your Form 8615 Please recompute your Form 8615, Tax for Certain Children Who Have Unearned Income, using our proposed unreported income as shown on this notice. Please return the completed Form 8615 with your response.

60 - Form W-2 or 1099 not received The law requires you to report your income correctly. If your payers did not send you a yearly income statement (Form W-2, Wage and Tax Statement, Form 1099, etc.), you must use the information you have (pay stubs, monthly income statements, deposit slips, etc.) to estimate the total amount of income you received during the year.

61 - Information mailed separately Additional information (forms, schedules, publications, etc.) concerning this notice has been mailed to you in a separate envelope.

62 - Premium tax credit We adjusted your premium tax credit based on changes we made to your modified adjusted gross income.

63 - Special 10-year averaging method Form 4972 Your Form 1099-R, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, Insurance Contracts, etc., indicates that you received a periodic IRA or SEP distribution. These distributions do not qualify for the special 10-year averaging computation on Form 4972, Tax on Lump-Sum Distributions.

64 - Unlocated interest, dividends, and/or capital gain amounts Since there was no breakdown by payer name on your tax return, we could not locate specific amounts of interest, dividends and/or capital gains distributions to match the amounts reported to us. Therefore, this notice lists all the interest, dividend, and/or capital gain distribution income your payers reported to us and includes credit for the amounts reported on your tax return. If this is incorrect, please list the specific amounts of interest, dividends, and/or capital gain distributions you received from each of your payers, the name of each payer, and the type of income.

65 - Qualified dividends not included in ordinary dividends The portion of qualified dividends eligible for the 20% capital gain rate was not included in the total ordinary dividends reported on page 1 of your tax return.

66 - Dependent Care benefits/recomputed Child Care Credit Dependent Care benefits should be used to compute your allowable Child Care Credit on Form 2441, Child and Dependent Care Expenses. We recalculated your Form 2441 using the information in Part II and Dependent Care Benefits information we received from your employer(s). Dependent Care Benefits are shown in box 10 of your Form W-2, Wage and Tax Statement. As a result, we changed your taxable Dependent Care Benefits and/or your allowable Child Care Credit. If you file for these credits on your tax returns in the future, be sure to complete Parts I, II and III of Form 2441.

67 - Unemployment compensation Unemployment Compensation is fully taxable because it is considered a substitute for wages.

68 - Social Security and Medicare Tax on unreported tip income Since we increased your wages to include unreported tip income, we also increased your Social Security and Medicare Tax.

69 - State and local income tax refund Because you claimed an itemized deduction for state and local taxes on your 2013 federal tax return, you must report any refund or credit of the state or local taxes as income on your 2014 federal tax return (or for the year in which you actually received the refund or credit).

70 - Your Individual Retirement Account (IRA) contributions are not verified Your trustee did not verify the amount claimed on your tax return as contributions to your individual retirement account (IRA). Contributions made after December 31st, for a previous tax year, are not reported to the IRS until the end of the calendar year. Please send us a copy of your Form(s) 5498, IRA Contribution Information, or similar document(s) to support your IRA deduction. However, if you or your spouse were covered by a pension plan, your IRA deduction may be reduced or eliminated if your modified adjusted gross income is more than the amount allowed for your filing status.

71 - Social Security Lump Sum Election method Our records show a discrepancy between the amount reported to us by the Social Security Administration and the amount you reported on your tax return. Please send a copy of the worksheets showing the method used to calculate the Lump Sum Election (LSE). Additional information is available in Publication 17, Your Federal Income Tax (For Individuals), and Publication 915, Social Security and Equivalent Railroad Retirement Benefits.

72 - Cancellation of Debt - Form 1099-C If a federal government agency, financial institution, credit union, or other lender cancels or forgives a debt you owe, the lender may be required to notify the IRS of the cancellation, and you must generally include the canceled amount as income on your tax return. There are several situations in which you do not have to include the canceled amount as income, but these exclusions are not automatic. You must claim the benefit of any exclusion, by filing Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment).

If you filed for bankruptcy, please provide us with a copy of your bankruptcy paperwork. If the canceled debt is excludable due to insolvency, please provide us with a breakdown of your total assets and liabilities immediately before the debt was discharged. You are insolvent to the extent that just prior to the debt cancellation your total liabilities exceeded your total assets (e.g., if your liabilities totaled $15,000 and your assets totaled $12,000, you are insolvent by $3,000). A worksheet that you may use for calculating insolvency is included in Publication 4681, Canceled Debts, Foreclosures, Repossessions and Abandonments (for Individuals). Debt cancellation is excludable only up to the insolvent amount. You must include any canceled debt that exceeds the amount of your insolvency as income on your tax return, unless another exclusion applies.

If you do not make payments you owe on a loan secured by property, the lender may foreclose on the loan or repossess the property. The foreclosure or repossession is treated as a sale or exchange from which you may realize a gain or loss. If the lender foreclosed on your principal residence, you may realize ordinary income from cancellation of debt if the loan balance is more than the fair market value of the property. If the amount of principal you owed on your home mortgage was reduced as part of a loan modification, you may be able to exclude the amount of canceled debt from income.

For additional information on these topics please see Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments (for Individuals); Publication 544, Sales and Other Dispositions of Assets; or visit www.irs.gov"Search" words "canceled debts" .

73 - Qualified mortgage insurance premium Schedule A deduction(s) We need to verify the qualified mortgage insurance premiums deduction claimed on Form 1040 Schedule A, Itemized Deductions. No amounts have been reported to us, on Form(s) 1098, Mortgage Interest Statement, to substantiate this deduction. Please provide copies of the document(s) used to support the amount claimed.

74 - Joint ownership information needed for early withdrawal of savings penalty Your payer penalized you by not giving you a certain amount of interest on your savings account since you withdrew your savings early. This penalty is deductible from your income since it is interest you did not receive.

In order for us to figure the deduction amount you are entitled to, please give us the names and social security numbers of the other joint owners of this account, and a breakdown of the income and early withdrawal interest penalty that each joint owner reported.

75 - Early withdrawal of savings penalty deduction The deduction claimed for the early withdrawal penalty does not match the amount reported by payers. Please submit verification for the amount claimed.

76 - Alternative Minimum Tax We refigured your alternative minimum tax. If your calculations differ, please send us a copy of your Form 6251, Alternative Minimum Tax - Individuals.

77 - Estimated tax penalty When you don't pay enough taxes due for the year with your quarterly estimated tax payments; we charge a penalty for not properly estimating your tax. For information about estimated tax requirements, see Form 2210, Underpayment of Estimated Tax by Individuals, Estates and Trusts, or Publication 505, Tax Withholding and Estimated Tax. (Internal Revenue Code section 6654)

Your estimated tax penalty may be refigured if we make an adjustment to your withholding, and/or excess social security/railroad retirement tax. If this penalty is refigured, we will advise you at a later date.

78 - Schedule A Qualified Mortgage Insurance Premiums deduction limitation- We changed the amount claimed for Qualified Mortgage Insurance Premiums because we changed your adjusted gross income (AGI). If your AGI is between $100,000 and $109,000 ($50,000 and $54,500 if married filing separately) the allowable deduction is limited. If your AGI is more than $109,000 ($54,500 if married filing separately) you are no longer allowed a Qualified Mortgage Insurance Premiums deduction.

79 - Interest/dividend math error We found a math error when we totaled your interest and/or dividend income on Schedule B, Interest and Ordinary Dividends.

80 - Taxable Health Savings Account distributions not reported The taxable portion of Health Savings Account distribution payments reported on your Form 8889, Health Savings Accounts, was not included as income on page 1 of your tax return.

81 - Rollover IRA contributionsForm 5498, IRA Contribution Information, shows the amount you deducted on your return as an IRA contribution was actually a rollover contribution. Because rollover contributions aren't deductible, you can't deduct this amount on your return. If this rollover information is incorrect, please send us a copy of your IRA statement or a similar document so we can correct our records.

82 - Health Savings Account distributions - Form 8889 We need more information to determine the taxable amount of the Health Savings Account distribution shown on this notice. Please complete and return Form 8889, Health Savings Accounts.

83 - Nondeductible IRAs - Form 8606 Our records indicate that the full taxable amount of your retirement distribution(s) as shown on Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., was not reported on your tax return. Please provide us with documentation to verify the taxable amount of the retirement distribution(s) and/or a completed Form 8606, Nondeductible IRAs.

84 - Foreign earned income tax Due to proposed changes to your taxable income, you may need to recalculate the amount of foreign earned income tax reported on your tax return. If you have any itemized deductions or exclusions you could not claim because they are related to excluded income, use the worksheet in the Form 1040 instructions to recalculate your foreign earned income tax and provide us with a copy.

85 - Backup Withholding on interest and dividends Our proposed changes are based on interest or dividends not reported on your tax return. If you agree that the income shown in our proposal is correct, but do not pay the tax increase, we may notify payers to deduct and withhold 28% of any payments they make to you in the future. This is called backup withholding and occurs when interest or dividend income is not reported on your tax return, as required by law.

86 - Accuracy-related penalty due to negligence An accuracy-related penalty is charged if there is any underpayment of tax on your return due to negligence. This penalty is 20% of the net tax increase on the portion due to negligence. (Internal Revenue Code section 6662(c))

If you think we should not charge this penalty, please explain why the penalty doesn't apply in a signed statement and send any supporting documents. We will review your request and determine if reasonable cause is established to eliminate the penalty.

87 - Payments you made We received your payment and applied it to your account. Payments are first applied to reduce your tax, then to any penalties and interest owed.

88 - Incorrect tax change in our previous notice Please disregard the previous CP 2000 Notice we sent you, as the proposed tax change was incorrect. We apologize for any inconvenience this may have caused. The "Changes to your tax return" section of this notice shows the correct figures. Please follow the instructions on Page 1 of this notice and submit your response by the due date shown on this notice.

89 - Income reported in the wrong tax year The "Changes to your tax return" section of this notice shows the correct amount of your tax and income for 2014. Please file an amended tax return (Form 1040X) to reduce your tax for the year in which you incorrectly included the income.

90 - Premium tax credit - amounts not verified The amount you reported on Form 8962, Premium Tax Credit, Part 2, for column(s) A-Premium, B-SLCSP, and/or F-Advance PTC, don't match the information we have on file from the Health Insurance Marketplace. Send us a copy of your Form(s) 1095-A, Affordable Insurance Marketplace Statement, to support the amounts you reported on Form 8962. If your Form 1095-A is incorrect, contact the Health Insurance Marketplace to obtain a corrected one and send us a copy.

91 - Accuracy-related penalty for substantial understatement of tax If we increase your tax, and the increase exceeds the greater of 10% of your corrected tax or $5,000, we are required by law to charge an accuracy-related penalty for the substantial understatement of tax. The penalty is 20% of your tax increase. (Internal Revenue Code section 6662(d))

The penalty may be reduced or waived if you:

- Provide the substantial authority (such as, Internal Revenue Code, Regulations, Revenue Rulings, Revenue Procedures, etc.) you used to decide how to treat your income or deduction, or

- Tell us where on your return you clearly show the facts supporting your treatment of the income or deduction, or

- Submit a signed statement that clearly outlines the facts supporting your treatment of the understated income.

92 - Accuracy-related penalties If both the accuracy-related penalty due to negligence and the accuracy-related penalty due to substantial understatement of tax apply, we will charge only the larger of the two penalties. (Internal Revenue Code Section 6662(a))

93 - Misidentified income If any of the income shown on this notice is not yours, send us the name, address, and social security number of the person who received the income. Please notify the payers to correct their records to show the name and social security number of the person who actually received the income, so that future reports to us are accurate.

94 - Negative taxable income The taxable income per return (TXI) on this notice differs from your original return. This notice reflects the actual amount of your taxable income to ensure proper credit for deductions and exemptions.

95 - IRA deduction adjusted The deduction for IRA contributions is dependent upon filing status, coverage by an employer retirement plan at any time during the year, and modified adjusted gross income (MAGI). If you were covered by a retirement plan at work or through self-employment, the deduction for IRA contributions is limited when your MAGI is between the amounts listed below and eliminated when MAGI exceeds the upper limit:

- $60,000 and $70,000 for filing status Single, Head of Household or Married Filing Separately - if you lived apart from your spouse for all of 2014.

- Less than $10,000 for filing status Married Filing Separately - if you lived with your spouse at any time during 2014; or

- $96,000 and $116,000 for filing status Married Filing Jointly or Qualifying widow(er).

If you were not covered by a retirement plan at work or through self-employment and your spouse is covered by a retirement plan at work or through self-employment, the deduction for IRA contributions is limited when your MAGI is between the amounts listed below and eliminated when MAGI exceeds the upper limit:

- Less than $10,000 for filing status Married Filing Separately - if you lived with your spouse at any time during 2014; or

- $181,000 and $191,000 for filing status Married Filing Jointly with a spouse who is covered by a retirement plan at work.

To avoid future tax year contact regarding this, please complete and attach Form 8606, Nondeductible IRAs, to your tax returns. Keep a copy for your records.

96 - Retirement distributions We need more information for the distribution shown on this notice. We need to know if the income is a pension or an annuity, an IRA or lump sum rollover, or an employee savings plan.

If the income is from a pension/annuity or an employee savings plan and you are recovering your contributions using the General Rule or the Simplified General Rule, please send us a signed statement with the date of your first pension payment, the amount you receive monthly, and the total amount you contributed.

If the income is an IRA or lump sum and was rolled over, please send us Form 5498, IRA Contribution Information or similar documentation.

If the income is an employee savings plan, please send us a copy of the document showing the total distribution amount you received for 2014 and the nontaxable amount of the distribution.

97 - Social Security/Railroad Benefits Social Security/Railroad Retirement Benefits were not reported correctly on your tax return when it was filed and we adjusted your tax liability during original processing. This notice corrects the processing adjustment. We apologize for any inconvenience this may have caused you.

98 - Education credits We need to verify the education credits claimed on Form 1040 lines 50 or 68, or on Form 1040A lines 33 or 44. Higher Education institutions can report either amounts paid for qualified expenses in box 1 or amounts billed in box 2, of Forms 1098-T, Tuition Statement. We don't consider amounts billed in box 2 as verification of actual expenses paid. Provide a signed detailed explanation of the amounts you paid to support the amount(s) claimed.

99 - Social Security or Tier 1 Railroad Retirement benefits Our notice includes Social Security or Railroad Retirement benefits. These benefits are partially taxable if your modified adjusted gross income, plus 50% of the gross benefits, exceeds the following:

- $25,000 if filing Single, Head of Household, Qualifying Widow(er), or Married Filing Separately and you did not live with your spouse at any time during the year.

- $32,000 if Married Filing Jointly; or

- $0 if Married Filing Separately and you lived with your spouse at any time during the year.

If the underreported items that cause the adjusted gross income to increase are found to be reported, the taxable Social Security/Tier 1 Railroad Retirement Benefits will be adjusted accordingly.

100 - Social Security/Railroad Retirement benefits workers' compensation offset The net benefits paid, as shown in box 5 of Form SSA-1099 or Form RRB-1099, are used to compute the taxable portion of your social security benefits. The amount of the Workers’ Compensation Offset included in box 3 of Form SSA-1099 or shown in box 6 of Form RRB-1099 cannot be used to reduce the net benefits paid. Please refer to IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefits or contact your local Social Security Administration or Railroad Retirement office for an explanation of the workers’ compensation offset amount.

101 - Accuracy related penalty waived We reviewed the information you provided and have waived the penalty imposed for failure to properly report income or deductions. However, interest on the balance due will be charged, as required by law.

102 - Commodity Credit Corporation (CCC) loans forfeited Our records indicate that a Commodity Credit Corporation Loan was not repaid, or that a CCC loan was repaid with Commodity Credit Certificates. If you believe this was a nontaxable transaction, please explain your reasons in a signed statement or send us a copy of any form or schedule showing where the income was reported (prior or subsequent tax year returns, etc.).

103 - Crop insurance Our records show you received crop insurance proceeds. We were unable to locate this amount on your Form 1040, Schedule F, Profit or Loss From Farming, or Form 4835, Farm Rental Income and Expenses. If you elected to postpone reporting your crop insurance proceeds as income, please explain in a signed statement or send us a copy of the tax return where the crop insurance is reported as income.

104 - Farm income - market gain Our records indicate you received a taxable market gain from the repayment of a secured Commodity Credit Corporation (CCC) Loan that was less than the original loan amount. If you believe that this market gain is non-taxable, please respond with a signed explanation.

105 - Education savings bond interest exclusion adjusted The exclusion claimed for education savings bond interest has been reduced because your modified adjusted gross income is between:

- $76,000 and $91,000 for filing status Single, or Head of Household.

- $113,950 and $143,950 for filing status Married Filing Jointly or Qualifying Widow(er) with dependent child.

The disallowed portion of the exclusion is reflected in the interest income amount shown in the "Changes to your tax return" section of this notice.

106 - Withholding claimed incorrectly The federal income tax withheld claimed on your tax return was taken from the wrong box of Form(s) W-2, Wage and Tax Statement.

107 - Education savings bond interest exclusion disallowed Since your filing status was Married Filing Separate, you are not entitled to the Education Savings Bond Exclusion, even if the bonds were used to pay for qualified higher education expenses.

108 - Unsubstantiated education savings bond interest exclusion We did not receive a Form 1099-INT, Interest Income, or a similar document for savings bond interest, showing the amount claimed for the education savings bond interest exclusion. If you have documents to substantiate the savings bond exclusion, please send a copy.

109 - Payment card and third party network transactions You received Form 1099-K, Payment Card and Third Party Network Transactions, because you accepted merchant cards for payments, or because you received payments through a third party network. The amount included on this notice for Form 1099-K reflects the gross reportable transaction amount and not the taxable amount of merchant card and third party network payments. The taxable amount from Form 1099-K should be reported on your Form 1040 Schedule C, Schedule E or Schedule F.

110 - Tuition and fees deduction adjusted Based on the increase made to your adjusted gross income, we have adjusted the amount of Tuition and Fees deduction claimed on your Form 8917, Tuition and Fees Deduction. If your new modified adjusted gross income is:

- Between $65,000.01 and $80,000.00 for filing status Single, Head of Household or Qualifying Widow(er) or between $130,000.01 and $160,000.00 for filing status Married Filing Jointly, we reduced your deduction to $2,000.

- Over $80,000 for filing status Single, Head of Household or Qualifying Widow(er) or $160,000 for filing status Married Filing Jointly, we reduced your deduction to $0.

111 - Tuition and fees disallowed You may not claim the deduction for Tuition and Fees and Education Credits for the same student.

112 - Tuition and fees deduction The tuition and fees deduction claimed on Form 1040 line 34 or Form 1040A line 19 needs to be verified. Your eligible educational institution did not report the amount claimed on your tax return, in box 1 of Form(s) 1098-T, Tuition Statement. Please provide a signed explanation of the amounts paid to support the amount(s) claimed.

113 - Reserved

114 - Revised Schedule A included in proposed changes Our proposed increase to income and tax has been adjusted by the revised Schedule A you provided with your response.

115 - Statutory employee income differs The statutory employee income reported to us by your employer(s) on Form(s) W-2, Wage and Tax Statement, does not agree with the amount of statutory employee income reported on your tax return. If this is incorrect, please send us a statement from your employer(s) verifying that you are a statutory employee.

116 - Schedule C or Schedule C-EZ expenses used to reduce income Only statutory employee income can be offset by expenses reported on Schedule C, Profit or Loss From Business, or Schedule C-EZ. Since your employer did not indicate on Form W-2, Wage and Tax Statement, that you were a statutory employee, we cannot allow the expenses used to offset that income on Schedule C or Schedule C-EZ.

If this is incorrect, please send us a statement from your employer(s) verifying that you are a statutory employee.

If you are not a statutory employee, you must include the income as wages on your tax return. Allowable related expenses on Form 2106, Employee Business Expenses, can be claimed as an itemized deduction on Schedule A.

117 - Mark-to-market election Our records indicate that you made a mark-to-market trader election for your securities transaction. Since you made a mark-to-market election, securities transactions relating to your trader activities need to be reported on Form 4797, Sales of Business Property. Please use Form 4797 in the future. For further information, see Publication 550, Investment Income and Expenses.

118 - Day trader loss limitation Our records do not indicate that you made a mark-to-market trader election for your securities transaction. Unless you made a mark-to-market election, sale of securities must be reported on Form 8949, Sales and Other Dispositions of Capital Assets and the results carried to Schedule D, Capital Gains and Losses. Losses from these transactions are subject to the limit on capital losses of $3,000 ($1,500 if married filing separately). For further information, see Publication 550, Investment Income and Expenses.

119- Court award or settlement In order for us to determine what portion (if any) of your award or settlement is taxable, please provide us with the following:

  • A written explanation of the nature and cause of your award.

  • A copy of the original complaint that was filed, along with the final court order or settlement agreement.

120 - Child Tax Credit The allowable amount of the Child Tax Credit is based on filing status, the number of qualifying child(ren), modified adjusted gross income and tax. The credit is adjusted when modified adjusted gross income changes. The credit cannot be more than the tax.

If you filed and claimed credits for mortgage interest, residential energy credits and/or District of Columbia first-time homebuyer with your original tax return, please provide us with recomputed worksheets from Publication 972, Child Tax Credit. In order to apply any unused credits from these sources, send us the recomputed forms. If you have already applied these unused credits to other tax year(s), you need to file a Form 1040X, Amended U.S. Individual Tax Return for the other year(s) with the appropriate Internal Revenue Service Center. If the tax return for the affected period has not yet been filed, confirm with a signed statement that your records have been corrected.

121 - Mortgage interest deduction allocation We could not match specific mortgage interest to specific Forms or Schedules on your tax return. Therefore, we allocated the mortgage interest deduction in the following order (as applicable): Schedule C, E, F, Form 4835, Farm Rental Income and Expenses, then to Form 8829, Expenses for Business Use of Your Home. Any remaining mortgage interest deduction was applied to Schedule A. If this is incorrect, please provide us with a breakdown and verification of all mortgage interest deduction claimed on your tax return.

122 - Double exclusion of penalty on early withdrawal of savings is not allowed A penalty for the early withdrawal of savings was included as an adjustment to income on Form 1040, line 30 and was also used to reduce the interest income reported on Schedule B. This is considered a double exclusion and is not allowed.

123 - Overpaid mortgage interest refund Since you claimed mortgage interest when you itemized your deductions on your 2013 tax return, you must also report any refund or credit of overpaid mortgage interest as income on your federal tax return for 2014 (or the year in which you actually received the refund or credit).

124 - Scholarship or fellowship grant information needed To help us determine if any portion of the scholarship or fellowship payments you received qualify for exclusion from income, please let us know whether or not you were a degree candidate when the scholarship or fellowship was granted.

- If you were a degree candidate, please indicate which amounts were used solely for tuition and course-related expenses.

- If you were not a degree candidate, the full amount of the scholarship or fellowship is taxable.

125 - We corrected your taxable income During the processing of your tax return we discovered a math error and made the necessary corrections for you. As a result, the taxable amount that appears in the "Changes to your tax return" section of this notice differs from the amount you originally reported.

126 - Broker and barter exchange transactions This notice shows information from Form(s) 1099-B, Proceeds From Broker and Barter Exchange Transactions, we received related to your account. Because bartering is an exchange of property or services, it has a fair market value, which is considered taxable income. Box 13 of Form 1099-B, shows the fair market value of your exchange(s). This amount is taxable income and must be included on your tax return. For each Form 1099-B transaction, please give us the date you acquired the asset and the cost or adjusted basis.

127 - Education credit qualification We disallowed education credits claimed on your return because Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits), lines 23-26 indicate you do not qualify for the credit claimed. If you are eligible to claim an education credit, complete Form 8863, including lines 23-26, and send to us.

128 - Education credit disallowed We disallowed education credits claimed on your return because Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits), lines 23-26 are incomplete. If you are eligible to claim the credit, complete Form 8863, including lines 23 -26, and send to us

129 - Jointly filed return of surviving spouse All income attributable to you or your spouse must be included on the joint tax return you filed for that year.

130 - Form 4972, Tax on Lump-Sum Distributions An error was made in figuring your Tax on Lump-Sum Distributions on Form 4972. We refigured your tax using the correct amount.

131 - Retirement distributions as Social Security/Railroad Retirement benefits Retirement distributions reported by payers on Form 1099-R (or Form RRB-1099-R) cannot be treated as Social Security/Railroad Retirement benefits.

132 - Reemployment Trade Adjustment Assistance payments The Reemployment Trade Adjustment Assistance (RTAA) payments reported to you on Form 1099-G, Certain Government Payments, box 5, were not fully reported on your tax return. This income is taxable. Please see Publication 17, Your Federal Income Tax (For Individuals) for further information.

133 - Domestic Production Activity Deduction - Form 8903 The Domestic Production Activity Deduction is based, in part, on your adjusted gross income. Since we adjusted your income we also adjusted the amount of allowable Domestic Production Activity Deduction.

134 - Retirement distributions do not qualify for capital gains treatment The retirement distribution(s) reported on Form 1040 line 13 or Schedule D, Capital Gains and Losses, do not qualify for capital gain treatment. Your payers reported the distributions as ordinary income, so you must report them as ordinary income on your tax return.

If the loss reflected on your Schedule D has been carried forward to a subsequent year, it must be adjusted accordingly. Please provide a revised Schedule D and if necessary, correct other affected tax years that have already been filed by submitting a Form 1040X, Amended U. S. Individual Income Tax Return, to the appropriate Internal Revenue Service Center.

If the tax return for the affected year has not yet been filed, confirm with a signed statement that your records will be corrected.

135 - Health savings account deduction (Form 1040, Form 8889) The Health Savings Account deduction reported on Form 1040, line 25 does not agree with the information provided to us by your trustees. If you have Form(s) 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information, or other documents to support your Health Savings Account deduction, please send copies to us.

136 - Health savings account distribution The Health Savings Account distribution reported on your Form 8889, Health Savings Accounts (HSAs),  Part II, does not agree with the information provided to us on Form(s) 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA.

137 - Excess Social Security/Railroad Retirement Tax withheld from one employer If one employer withheld excess Social Security or Railroad Retirement Tax from your pay, you must ask the employer to reimburse you because you cannot claim the excess amount on your federal income tax return.

139 - Documents attached to your tax return were not reported You attached Form(s) W-2, Wage and Tax Statement, 1099, or other documents to your income tax return, but did not include the amounts in your calculation of income and/or withholding. These amounts are included in the proposed "Changes to your return" section of this notice.

140 - 20% Tax on Health Savings Account distribution Premature distributions from a Health Savings Account are subject to an additional 20% tax. A distribution is considered premature if it was paid before you reached age 65. The 20% tax is based on the taxable portion of the distribution. Exceptions may apply as indicated in Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans. If the distribution(s) shown on this notice are exempt from the additional tax, please send us a signed explanation.

141 - Netted state and local income tax refund State and local income tax refunds should be included as income on your tax return (Form 1040, line 10). Do not deduct the state or local income tax refund you received from your state and/or local tax withheld and report the net amount on Schedule A, line 5.

142 - 179 Expenses double deduction It appears that you adjusted your distributive share income (or loss) claimed on Schedule E, Part II by the amount of Section 179 expense deduction and claimed the same 179 expense deduction on Schedule E, Part II, column (i). This double deduction is not allowed.

143 - Additional Medicare Tax withheld We adjusted the amount you claimed as Additional Medicare Tax withheld on Form 1040, line 64, because it appears you incorrectly completed Form 8959, Additional Medicare Tax.

144 - Gambling losses limited to gambling winnings The law allows you to claim gambling losses only up to the amount of income reported from your gambling winnings.

146 - Simplified Employee Pension (SEP) deduction (disallowed) You are not eligible to claim a deduction for contributions to your own SEP, SIMPLE, or qualified plans because no self-employment income was reported on your tax return. For further information, please see Publication 560, Retirement Plans for Small Business (SEP, SIMPLE and Qualified Plans).

147 - Potential change to self-employed health insurance deduction If the self-employment income shown on this notice is correct, it may be to your advantage to recalculate your self-employed health insurance deduction. Send us your updated calculation if applicable.

148 - Potential change to charitable contributions increase Because of our proposed increase to your income, you may be entitled to claim additional charitable contributions, as long as they were not used in a later tax year. If you are entitled to additional charitable contributions on your 2014 return, please send us a signed statement showing the amount of the additional contributions you want to claim.

149 - Special Tax Computation changes taxable income Based on information included on your 2014 tax return, you were eligible to use the Special Tax Computation to calculate the tax deduction for dependents. We used this method to refigure your taxable income. The resulting changes are shown in the "Changes to your tax return" section of this notice.

150 - Refigured tax based on Schedule D computation We refigured your tax using the Schedule D tax computation.

151 - Excess Social Security Tax/Railroad Retirement Tax (SST/RRT) Social security withholding in 2014 was limited to $7,254. If you filed a joint return, this limit applies to each taxpayer. You must figure the credit separately for each spouse to determine if either one had excess withholding. You can claim a credit for any excess withholding if you had 2 or more employers. Use Form 843, Claim for Refund and Request for Abatement, to claim a refund of excess Railroad Retirement Tier 2 tax. See Publication 505, Tax Withholding and Estimated Tax for more details.

152 - Form 4972 - Special tax treatment does not apply to IRA distributions Your IRA distribution does not qualify for special tax treatment on Form 4972, Tax on Lump-Sum Distributions.

153 - Excess Advance Premium Tax Credit repayment We adjusted your excess advance premium tax credit repayment based on changes we made to your modified adjusted gross income.

154 - Non-active military personnel Retired and non-active status members of the military cannot deduct allowances for uniforms, housing, subsistence, etc. For additional information, please refer to Revenue Ruling 71-307 and 72-69.

155 - Military retirement distributions Distributions from your military retirement plan are fully taxable. If the taxable amount is not correct because you received a retroactive disability rating after you retired, please send us a statement from the Department of Veterans Affairs showing the dates of the retroactive period and the amount of your retirement pay you would have been able to receive as disability benefits.

156 - Dependent care benefits Employer provided dependent care benefits shown in box 10 of Form W-2, Wage and Tax Statement, are considered fully taxable since Form 2441, Child and Dependent Care Expenses, is missing or incomplete. If you paid for child or dependent care in 2014, please complete and return Form 2441. Use Part III to determine the taxable amount of benefits you received, any excluded benefits, and the allowable amount of qualified expenses.

157 - Contributions to 401(K) were deducted incorrectly Contributions made by you or your employer to a 401(K), or other deferred compensation plan, have already been excluded from the wage amount shown in box 1 of Form W-2, Wage and Tax Statement. Therefore, they cannot be deducted again from the income reported on your tax return. If you believe box 1 of your Form W-2 erroneously included the amounts of these contributions or shows a wrong box checked, please send us a statement from your employer that contains the correct information.

158 - Amendments or adjustments to your return have been included in this notice Previous changes to your original tax return were considered in figuring the amounts shown in the "Changes to your tax return" section of this notice under the heading "Shown on return". This may include any adjustments we made at the time you filed or changes you may have made at a later date by amending your return.

159 - Reimbursement of employee business expenses Business expenses, which exceed reimbursement, are deductible only if reported on Schedule A, Itemized Deductions. If the income shown on this notice is a reimbursement of employee business expenses, please complete and return Form 2106, Employee Business Expenses. If you did not file a Schedule A and your total itemized deductions, including deductible expenses from Form 2106, exceed your standard deduction amount, it may benefit you to also complete and return a Schedule A claiming those deductions.

161 - Self-Employment tax change due to mortgage interest adjustment Some or all of the decrease in mortgage interest shown in the "Changes to your tax return" section of this notice was deducted on Schedule C, Profit or Loss from Business, line 16a and/or Schedule F, Profit or Loss from Farming, line 21a. The decrease in this deduction resulted in an increase to your net Self-Employment income. Therefore, we have recomputed the amount of your Self-Employment tax.

162 - Social Security benefits for taxpayers who filed Married Filing Separately If you were married and filed separately, but lived with your spouse at any time during 2014, the taxable social security benefits reported on your tax return may be incorrect because you can't deduct a base amount from total income. For more information, please see the Form 1040 instructions on social security benefits, or Publication 915, Social Security and Equivalent Railroad Retirement Benefits.

163 - Employee's share of FICA FICA tax, which includes both Social Security tax and Medicare tax, is paid by both employers and employees. An employer is required to withhold an employee’s share of FICA tax from wages paid to the employee. Because your employer did not withhold FICA tax from your pay, you are required to pay the employee share. This notice includes your employee share of FICA tax at 7.65% on gross wages (amounts incorrectly reported as non-employee compensation) which will be credited to your Social Security and Medicare account. We used the determination from Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, regarding your employee status for the non-employee compensation you received.

164 - Wage adjustments based on stock option statements Your wages may not be reduced by amounts shown on Stock Option statements.

165 - Tax treatment of non-statutory stock options Non-statutory stock option gains are considered ordinary income and do not qualify for capital gain treatment.

166 - Cost basis of stock sold We used the cost basis shown in box 3, on Form 1099-B, Proceeds From Broker and Barter Exchange Transactions, provided by the broker. If the broker did not provide an amount in box 3, we used a zero cost basis because we were not able to determine the cost or the adjusted basis of the stock sold.

Please provide a completed Schedule D, Capital Gains and Losses, along with a completed Form 8949, Sales and Other Dispositions of Capital Assets, (or similar attachment) showing:

  • the asset name,

  • the date you acquired the asset and

  • the cost or adjusted basis of your asset

for each Form 1099-B transaction shown on the attached pages of this notice.

167 - Illegal use of Social Security number If you have reason to believe that someone is illegally using your Social Security number, please send us:

- a copy of a valid U.S. federal or state government-issued form of identification (example, driver’s license, state identification card, social security card, passport, etc.), and

- a copy of either a police report or a completed IRS Form 14039, Affidavit of Identity Theft (available at www.irs.gov) and

- a signed statement identifying each specific item(s) that is a result of the identity theft.

You should also contact the Federal Trade Commission Identity Theft Hotline (1-877-438-4338) or the Federal Trade Commission website at www.ftc.gov for information about correcting your records.

168 - 10% Tax claimed as early withdrawal penalty The 10% early distribution tax on qualified retirement plans cannot be deducted as an early withdrawal of savings. It is an additional tax that must be reported on the return.

169 - Mortgage interest included on Form 8829 It appears that you deducted the same mortgage interest on Form 8829, Expenses for Business Use of Your Home, and on Schedule A, Itemized Deductions, which is a double deduction and is not allowed. To correct your deduction, you must first deduct mortgage interest on Form 8829 and then deduct the remaining mortgage interest on Schedule A.

170 - Accuracy-related penalty not waived We reviewed the information you provided and determined that it did not provide reasonable cause for the omission of income or overstatement of deductions. As a result, we have not waived the accuracy-related penalty, as you requested.

171 - Your Form 1040X did not include penalties We received your Form 1040X, Amended U.S. Individual Income Tax Return, in response to our previous notice. The Form 1040X did not include penalties which are included in this notice.

172 - Additional Medicare Tax Additional Medicare Tax went into effect on January 1, 2013. The 0.9 percent Additional Medicare Tax applies when the total of an individual's wages, Railroad Retirement Tax Act compensation and self-employment income exceeds the following:

  • $250,000 for married taxpayers who file jointly

  • $125,000 for married taxpayers who file separately

  • $200,000 for taxpayers who file single, head of household, or qualifying widower

We have refigured the Additional Medicare Tax based on changes to your wages, Railroad Retirement Tax Act compensation, and self-employment income.

173 - Net Investment Income Tax The Health Care and Education Reconciliation Act of 2010 added a Net Investment Income Tax (NIIT) for tax years 2013 and subsequent. The NIIT applies at a rate of 3.8% to certain net investment income of individuals, estates, and trusts. In general, net investment income includes interest, dividends, capital gains, rental and royalty income, non-qualified annuities, and income from businesses in which the taxpayer is not an active participant. The 3.8% tax applies when you have investment income and your modified adjusted gross income exceeds the following:

  • $200,000 for single or head of household

  • $250,000 for married filing jointly or qualifying widow(er)

  • $125,000 for married filing separately

Since we changed your investment income, we also changed the amount of Net Investment Income Tax due.

174 - Interest and additional tax on nonqualified deferred compensation Our records indicate that you received income reported on Form W-2, Wage and Tax Statement (box 12 with code Z) or Form 1099-MISC, Miscellaneous Income (line 15b), due to participation in a nonqualified deferred compensation plan subject to Internal Revenue Code Section 409A. Because your plan did not comply with Internal Revenue Code Section 409A, this income is subject to a premium interest tax and an additional 20% tax. For further information see Publication 17, Your Federal Income Tax (For Individuals) and Internal Revenue Code Section 409A.

176 - Stolen identity documentation received We received documentation that you are a victim of identity theft. If the discrepancies shown in this notice are a direct result of the identity theft, please provide a signed statement identifying each specific item(s) that is a result of the identity theft.

177 - Deduct tax from refund We may not be able to deduct the balance due from your expected refund as you requested. If your full refund is received, you will be billed for the income tax deficiency.

178 - Power of Attorney We sent a copy of this notice to your representative as indicated in your Power of Attorney.

180 - Request for information document We apologize however, we are unable to provide a copy of the information document you requested because we received this information on magnetic tape. To get a copy, please contact the payer.

181 - Unable to contact taxpayer sooner We were unable to contact you sooner because of the time we needed to process the information submitted by the various financial institutions and payers, and then compare it with the information shown on your return.

182 - Copy of notice sent to spouse A copy of this notice was also sent to your former spouse. You and your former spouse are jointly and separately liable for the full amount of the deficiency.

184 - Earned Income Credit disallowed due to investment income The Earned Income Credit claimed on your return has been disallowed because your investment income exceeds $3,350.

185 - Archer MSA deduction (Form 1040, Form 8853) The Archer Medical Savings Account deduction reported on Form 1040 does not agree with the information provided to us by your trustees. If you have Form(s) 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information, or other documents to support your Archer Medical Savings Account deduction, please send copies to us.

186 - Archer MSA distribution The Archer Medical Savings Account or Medicare Advantage MSA distribution reported on your return does not agree with the information provided to us on Form(s) 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA.

187 - Long-Term Health Care Benefits (Form 1040, Form 8853) The Long-Term Health Care Benefits reported on your return does not agree with the information provided to us on Form(s) 1099-LTC, Long-Term Care and Accelerated Death Benefits.

188 - Adoption credit adjusted Your adoption credit has been reduced because your modified adjusted gross income is between $197,881 and $237,879.

189 - Adoption credit disallowed We disallowed your credit for qualified adoption expenses because your modified adjusted gross income is $237,879 or more.

190 - Employer-provided adoption benefits (Form 8839) Based on information provided on Form(s) W-2, Wage and Tax Statement, (box 12 with code T) and/or other changes to your income, the amount of employer-provided adoption benefits claimed on your tax return will be adjusted.

191 - Taxable employer provided adoption benefits not included in income The taxable benefits reported on Form 8839, Qualified Adoption Expenses, line 29 were not included as income on page 1 of your tax return.

194 - Premature distributions tax from a Simple IRA Plan Premature distributions from your SIMPLE IRA Plan are subject to an additional 10% tax. A distribution is considered premature if it was paid before you reached age 59 1/2. However, the 10% tax is increased to 25% if the distribution was made within 2 years of beginning participation. Exceptions may apply as indicated in Publication 17, Your Federal Income Tax (For Individuals), Publication 590, Individual Retirement Arrangements (IRAs) or Publication 560 Retirement Plans for Small Business (SEP, SIMPLE and Keogh Plans). If the distribution(s) shown on this notice are exempt from the additional tax, please send us a signed explanation.

195 - Employer-provided adoption benefits subtracted from wages Employer-Provided Adoption Benefits cannot be deducted from your wages. If you have any excludable benefits, please complete and return Form 8839, Qualified Adoption Expenses.

196 - 20% tax on Archer Medical Saving Account distributions (Archer MSA) Premature distributions from Archer Medical Savings Accounts are subject to an additional 20% tax. A distribution is considered premature if it was paid before you reached age 65. Exceptions may apply as indicated in Publication 969, Health Saving Accounts and Other Tax-Favored Health Plans. If the distribution(s) shown on this notice are exempt from the additional tax, please send us a signed explanation.

197 - Taxable Archer MSA distributions - Long-Term Care payments not reported The amount of taxable Archer MSA distributions and/or Long-Term Care payments reported on your Form 8853, Archer MSAs and Long-Term Care Insurance Contracts, was not included as income on page 1 of your tax return.

199 - Stolen identity claim not allowed We did not allow your claim of identity theft because you did not provide the information we requested.

Exhibit 4.19.3-8 
Form W-2 - Box 12 Codes

The following list explains the codes shown in Box 12, Form W-2. Elective deferral (codes D, E, F, G, H, and S) under all plans are generally limited to $13,000 ($16,000 for section 403(b) plans, if the TP qualified for the 15-year rule as explained in Publication 571). However, TPs who were at least age 50 in the AUR year, may have been allowed an additional deferral, by the employer, of up to $5,000 ($2,500 for section 401(k)(11) and 408(p) SIMPLE plans). This additional deferral amount is not subject to the overall limit on elective deferrals. For Code G, the limit on elective deferrals may be higher for the last 3 years before the TP reached retirement age. Amounts in excess of the overall deferral limit must be included in income.

Code Definition
A Uncollected social security or RRTA tax on tips
B Uncollected Medicare tax on tips.
C Taxable cost of group-term life insurance over $50,000 (included in boxes 1, 3 (up to social security wage base), and 5).
D Elective deferrals to a section 401(k) cash or deferred arrangement. Also includes deferrals under a SIMPLE retirement account that is part of a section 401(k) arrangement.
E Elective deferrals under a section 403(b) salary reduction agreement.
F Elective deferrals under a section 408(k)(6) salary reduction SEP.
G Elective deferrals and employer contributions (including nonelective deferrals) to a section 457(b) deferred compensation plan.
H Elective deferrals to a section 501(c)(18)(D) tax-exempt organization plan.
J Nontaxable sick pay (information only, not included in boxes 1, 3, or 5)
K 20 percent excise tax on excess golden parachute payments.
L Substantiated employee business expense reimbursements (non-taxable).
M Uncollected social security or RRTA tax on taxable cost of group-term life insurance over $50,000 (former employees only).
N Uncollected Medicare tax on taxable cost of group-term life insurance over $50,000 (former employees only).
P Excludable moving expense reimbursements paid directly to the employee (not included in boxes 1, 3, or 5).
Q Nontaxable combat pay
R Employer contributions to Archer (MSA)
S Employee salary reduction contributions under section 408(p) SIMPLE (not included in box 1).
T Adoption benefits (not included in box 1). Form 8839 must be completed to compute taxable amount.
V Income from exercise of nonstatutory stock option(s) (included in boxes 1, 3 (up to social security wage base), and 5).
W Employer contributions to Health Savings Account
Y Deferrals under a section 409A nonqualified deferred compensation plan
Z Income under a section 409A nonqualified deferred compensation plan
AA Designated Roth contributions to a section 401(k) plan
BB Designated Roth contributions under a section 403(b) salary reduction agreement.
DD Cost of employer-sponsored health coverage. The amount reported with Code DD is not taxable.
EE Designated Roth contributions under a governmental section 457(b) plan. This amount does not apply to contributions under a tax-exempt organization section 457(b) plan.

Exhibit 4.19.3-9 
Income Identify Codes

Value Meaning
ES Employee Saving Plan
FT FICA Tax Withheld
LC Long-term Cost Basis
LS Lump Sum Distribution
MA Mortgage Interest Deduction - Schedule A
ME Mortgage Interest Deduction - Schedule E or Form 4835
MS Medical Saving Account Deduction
MT Medicare Tax Withheld
PB Primary Business Self-Employment Income
PE Primary Earned Income
PF Primary Farm Self-Employment Income
PN Pension/Annuity
RO Rollover (used to the suppress 10 percent or 25 percent penalty)
RT RRTA Tax Withheld
SB Secondary Business Self-Employment Income
SC Short-term Cost Basis
SD Schedule D Capital Gains-Long Term Gain/Loss No Code Assigned (This value should display as blank in the INC CD field)
SE Secondary Earned Income
SF Secondary Farm Self-Employment Income
ST Schedule D Capital Gains-Short Term Gain/Loss
SW Statutory Wages
5P Form 1099-R distribution subject to 5 percent premature distribution tax

Exhibit 4.19.3-10 
Non-Select Table

Non-Select Terms    
ACCOUNT ACF ACT
ACCT ADM ADMIN
ADMINISTRATOR AGENT AGT
AS ASSN ASSOC
ASSOCIATES ASSOCIATION ATF
ATTORNEY ATTY ATTYS
CF CHILDREN CSN
CO COMP COMPANIES
COMPANY CONS CONSERV
CONSERVATOR CORP CORPORATION
COTRUSTEE COTR CUST
CUSTODIAN CUSTODIAN for ESCROW
EST ESTATE EX
EXEC EXECUTOR EXECUTRIX
EXTRX FBO FOUNDATION
GDN GIFT GUAR
GUARDIAN HEIRS INC
INCORPORATED INFANT ITF
LEG LEGAL LIMITED
LTD MARITAL MINORS
ORDER PARENT RESIDUARY
SPECIAL SUCCESSOR TF
TR TTEE TRUST
TRUSTEE TRUSTEES UA
UGMA UGTMA UNDER
UNIF UNIFORM USE
UW    

Exhibit 4.19.3-11 
Notice Review Error Codes

Critical Errors

Code Error
01 Wage income amount incorrect
01a EPAB income amount incorrect
01b Dependent Care amount incorrect
02 Interest income amount incorrect
03 Dividend income amount incorrect
04 Capital Gain Distribution amount incorrect
05 State Income Tax Refund amount incorrect
06 Nonemployee Compensation amount incorrect
06K Merchant Card amount incorrect
07 Gross Medical Receipt amount incorrect
08 Fishing income amount incorrect
09 Retirement income amount incorrect
10 Rent/Royalty income amount incorrect
11 Conduit income amount incorrect
12 Agricultural Subsidy income amount incorrect
13 CCC Loan income amount incorrect
14 Patronage Dividend amount incorrect
15 Crop Insurance amount incorrect
16 Unemployment Compensation amount incorrect
17 SS/RR income amount incorrect
18 Other Income amount incorrect
19 Gambling income amount incorrect
20 Cancellation of Debt amount incorrect
21 Taxable Grants amount incorrect
22 Substitute Payment in Lieu of Dividend amount incorrect
23 Securities Sales income incorrect
24 Barter income amount incorrect
25 Real Estate amount incorrect
26 Refund of Overpaid Mortgage (ROMID) interest amount incorrect
27 Qualified Tuition Program income amount incorrect
28 Archer Medical Savings Account income amount incorrect
29 Long Term Care Benefits income amount incorrect
30 IRA, SEP/Keogh, or Simple Deduction amount incorrect
31 Archer Medical Savings deduction amount incorrect
32 Early Withdrawal Penalty Deduction amount incorrect
33 Student Loan Interest Deduction amount incorrect
33a Tuition and Fees
33b Domestic Production Activity Deduction amount incorrect
34 AGI Window incorrect
34a Filing status incorrect
34 Exemption amount incorrect
35 Mortgage Interest Deduction amount incorrect
35a Mortgage Insurance Premium amount incorrect
36 Schedule A Deduction amount incorrect
37 Additional Tax amount incorrect
37a Form 8814
37b Form 4972
37c Form 6251
38 Taxable Income per return amount incorrect
39 Tax per return amount incorrect
39a Schedule D window incorrect
40 Non-refundable credit amount incorrect
40a Foreign Tax credit incorrect
40b Child Care credit incorrect
40c Credit for the Elderly incorrect
40d Education credit incorrect
40e Retirement Savings Contributions incorrect
40f Child Tax credit incorrect
40g Adoption credit incorrect
40h Miscellaneous credit incorrect
41 SE tax incorrect
42 Other taxes amount incorrect (except SE tax)
42a Social Security and Medicare tax incorrect
42b Tax on qualified plans incorrect
42d Household employment tax incorrect
42e Miscellaneous tax incorrect
42f Net Investment Income tax incorrect
42g Additional Medicare tax amount incorrect
43 Prepayment Credits
43a Withholding change amount incorrect
43b Earned income credit amount incorrect
43c Excess SSTAX change amount incorrect
43d Additional Child Tax Credit amount incorrect
43e Estimated Tax Penalty amount incorrect
43f American Opportunity Credit amount incorrect
43g Additional Medicare Tax withheld amount incorrect
43h Net Premium Tax Credit amount incorrect
48 CP 2000 generated erroneously - case should have been closed
49 29X should have been ordered

Non-Critical Errors (No change in tax)

Code Error
01N Wage income amount incorrect
01aN EPAB income amount incorrect
01bN Dependent Care amount incorrect
02N Interest income amount incorrect
03N Dividend income amount incorrect
04N Capital Gain Distribution amount incorrect
05N State Income Tax Refund amount incorrect
06N Nonemployee Compensation amount incorrect
07N Gross Medical Receipt amount incorrect
08N Fishing income amount incorrect
09N Retirement income amount incorrect
10N Rent/Royalty income amount incorrect
11N Conduit income amount incorrect
12N Agricultural Subsidy income amount incorrect
13N CCC Loan income amount incorrect
14N Patronage Dividend income amount incorrect
15N Crop Insurance amount incorrect
16N Unemployment Compensation amount incorrect
17N SS/RR income amount incorrect
18N Other Income amount incorrect
19N Gambling income amount incorrect
20N Cancellation of Debt amount incorrect
21N Taxable Grants amount incorrect
22N Substitute Payment in Lieu of Dividends amount incorrect
23N Security Sales income amount incorrect
24N Barter income amount incorrect
25N Real Estate amount incorrect
26N Refund of Overpaid Mortgage interest amount incorrect
27N Qualified Tuition Program income amount incorrect
28N Archer Medical savings Account income amount incorrect
29N Long Term Care Benefits income amount incorrect
30N IRA, SEP/Keogh, or Simple Deduction amount incorrect
31N Archer Medical Savings deduction amount incorrect
32N Early Withdrawal Penalty Deduction amount incorrect
33N Student Loan Interest Deduction amount incorrect
33aN Tuition and Fees amount incorrect
34N Exemption amount incorrect
35N Mortgage Interest Deduction amount incorrect
36N Schedule A Deduction amount incorrect
38N Taxable income per return incorrect
39N Tax per return amount incorrect
39aN Schedule D window incorrect
48N CP 2000 generated erroneously - should have been CP 2501
50 Information Return omitted or incorrect information return selected
51 Incorrect paragraph selected or paragraph omitted
52 Schedule A incorrect
52a Medical amount incorrect
52b Contribution amount incorrect
52c Casualty and Theft amount incorrect
52d Miscellaneous amount incorrect
53 Return amount on Summary screen incorrect

Exhibit 4.19.3-12 
Titles of Forms and Schedules

Forms Title
Form 1040 U.S. Individual Income Tax Return
Form 1040A U.S. Individual Income Tax Return
Form 1040EZ Income Tax Return for Single and Joint Filers With No Dependents
Form 1040NR U.S. Nonresident Alien Income Tax Return
Form 1040X Amended U.S. Individual Income Tax Return
Form 433-D Installment Agreement
Form 843 Claim For Refund and Request for Abatement
Form 872 Consent to Extend the Time to Assess Tax
Form 911 Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order)
Form 966 Corporate Dissolution or Liquidation
Form 982 Reduction of Tax Attributes Due to Discharge of Indebtedness (And Section 1082 Basis Adjustment)
Form 1041 U.S. Income Tax Return for Estates and Trusts
Form 1045 Application for Tentative Refund
Form 1065 U.S. Return of Partnership Income
Form 1098 Mortgage Interest Statement
Form 1099-K Payment Card and Third Party Network Transactions
Form 1116 Foreign Tax Credit
Form 1128 Application to Adopt, Change, or Retain a Tax Year
Form 1310 Statement of Person Claiming Refund Due a Deceased Taxpayer
Form 2106 Employee Business Expenses
Form 2275 Records Request, Charge and Recharge
Form 2441 Child and Dependent Care Expenses
Form 2555 Foreign Earned Income
Form 2848 Power of Attorney and Declaration of Representative
Form 2859 Request for Quick or Prompt Assessment
Form 3115 Application for Change in Accounting Method
Form 3210 Document Transmittal
Form 3244 Payment Posting Voucher
Form 3552 Prompt Assessment Billing Assembly
Form 3800 General Business Credit
Form 3903 Moving Expenses
Form 3999 Statute Expiration Report
Form 4029 Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits
Form 4137 Social Security and Medicare Tax on Unreported Tip Income
Form 4251 Return Charge-Out
Form 4361 Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners
Form 4442 Inquiry Referral
Form 4562 Depreciation and Amortization
Form 4563 Exclusion of Income for Bona Fide Residents of American Samoa
Form 4684 Casualties and Thefts
Form 4797 Sales of Business Property
Form 4835 Farm Rental Income and Expenses
Form 4952 Investment Interest Expense Deduction
Form 4972 Tax on Lump-Sum Distributions
Form 5147 IDRS Transaction Record
Form 5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts
Form 5344 Examination Closing Record
Form 5346 Examination Information Report
Form 5405 First-Time Homebuyer Credit
Form 5498 IRA Contribution Information
Form 5564-A Notice of Deficiency - Waiver
Form 5695 Residential Energy Credit
Form 6198 At-Risk Limitations
Form 6251 Alternative Minimum Tax - Individuals
Form 6252 Installment Sale Income
Form 6781 Gains and Losses from Section 1256 Contracts and Straddles
Form 8082 Notice of Inconsistent Treatment or Administrative Adjustment Request (AAR)
Form 8275 Disclosure Statement
Form 8396 Mortgage Interest Credit
Form 8453 U.S. Individual Income Tax Transmittal for an IRS e-file Return
Form 8582 Passive Activity Loss Limitations
Form 8606 Nondeductible IRAs
Form 8615 Tax for Certain Children Who Have Unearned Income
Form 8796 Request for Return/Information (Federal/State Tax Exchange Program)
Form 8626 Agreement to Rescind Notice of Deficiency
Form 8801 Credit For Prior Year Minimum Tax-Individuals, Estates, and Trusts
Form 8805 Foreign Partner's Information Statement of Section 1446 Withholding Tax
Form 8814 Parents' Election To Report Child's Interest and Dividends
Form 8815 Exclusion of Interest From Series EE U.S. Savings Bonds Issued After 1989
Form 8821 Tax Information Authorization
Form 8824 Like-Kind Exchanges
Form 8822 Change of Address
Form 8829 Expenses for Business Use of Your Home
Form 8839 Qualified Adoption Expenses
Form 8853 Archer MSAs and Long-Term Care Insurance Contracts
Form 8857 Request for Innocent Spouse Relief
Form 8862 Information to Claim Earned Income Credit After Disallowance
Form 8863 Education Credits (American Opportunity and Lifetime Learning Credits)
Form 8880 Credit for Qualified Retirement Savings Contributions
Form 8889 Health Savings Accounts
Form 8903 Domestic Production Activities Deduction
Form 8917 Tuition and Fees Deduction
Form 8919 Uncollected Social Security and Medicare Tax on Wages
Form 8949 Sales and other Dispositions of Capital Assets
Form 8958 Allocation of Tax Amounts Between Certain Individuals in Community Property States
Form 8959 Additional Medicare Tax
Form 8960 Net Investment Income Tax - Individuals, Estates, and Trusts
Form 9355 Barred Statute Report
Form 9409 IRS/SSA Wage Worksheet
Form 9452 Filing Assistance Program (Do you have to file a tax return?)
Form 9465 Installment Agreement Request
Form 9856 Attachment Alert
Form 12175 Third Party Contact Report Form
Form 12203 Request for Appeals Review
Form 12249 Adjustment Document
Form 12412 Operations Assistance Request (OAR)
Form 12775 ADJ54 Adjustment Format
Form 13056 Input Edit Sheet
Form 13549 Campus Fraud Lead Sheet
Form 13794 Request for Release or Partial Release of Notice of Federal Tax Lien
Form 14027-B Identity Theft Case Referral
Form 14039 Identity Theft Affidavit
Form 14103 Identity Theft Assistance Request (ITAR)
Form 14157 Return Preparer Complaint
Form 14157-A Tax Return Preparer Fraud and Misconduct Affidavit
Form 14394 Identity Theft Collection Alert
Form 1098-E Student Loan Interest Statement
Form 1098 - T Tuition Statement
Form 1099-A Acquisition or Abandonment of Secured Property
Form 1099-B Proceeds From Broker and Barter Exchange Transactions
Form 1099-C Cancellation of Debt
Form 1099-DIV Dividends and Distributions
Form 1099-G Certain Government Payments
Form 1099-INT Interest Income
Form 1099-LTC Long-Term Care and Accelerated Death Benefits
Form 1099-MISC Miscellaneous Income
Form 1099-OID Original Issue Discount
Form 1099-PATR Taxable Distributions Received From Cooperatives
Form 1099-Q Payments From Qualified Education Programs (Under Section 529 and 530)
Form 1099-R Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
Form 1099-S Proceeds From Real Estate Transactions
Form 1099-SA Distributions From an HSA, Archer MSA, or Medicare Advantage MSA
Form 1120 U.S. Corporation Income Tax Return
Form 1120-S U.S. Income Tax Return for an S Corporation
Form 2555-EZ Foreign Earned Income Exclusion
Form 5498-ESA Coverdell ESA Contribution Information
Form 5498-SA HSA, Archer MSA, or Medicare Advantage MSA Information
Form 8275-R Regulation Disclosure Statement
Form 8288-A Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property Interests
Form 872-A Special Consent to Extend the Time to Assess Tax
Form SS-8 Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding
Form W-2C Statement of Corrected Income and Tax Amounts
Form SS-4 Application for Employer Identification Number
Form 1042-S Foreign Person's U.S. Source Income Subject to Withholding
Form W-2 G Certain Gambling Winnings
Form W-2 Wage and Tax Statement
Form W-4 Employee's Withholding Allowance Certificate
Schedule Title
Schedule 8812 Child Tax Credit
Schedule A Itemized Deductions
Schedule B Interest and Ordinary Dividends
Schedule C Profit or Loss From Business (Sole Proprietorship)
Schedule C-EZ Net Profit from Business (Sole Proprietorship)
Schedule D Capital Gains and Losses
Schedule E Supplemental Income and Loss
Schedule EIC Earned Income Credit
Schedule F Profit or Loss From Farming
Schedule H Household Employment Taxes
Schedule J Income Averaging For Farmers and Fishermen
Schedule K-1 (Form 1041) Beneficiary’s Share of Income, Deductions, Credits, etc.
Schedule K-1 (Form 1120S) Shareholder’s Share of Income, Deductions, Credits, etc.
Schedule K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc.
Schedule R Credit for the Elderly or the Disabled
Schedule SE Self-Employment Tax

Exhibit 4.19.3-13 
AUR Reconsideration Issue Codes

Recon Issue Code Text PC/IPC Compatibility
1 Accuracy Related Penalty abatement 9P
2 Accuracy Related penalty abatement denied 9N
3 Copy of CP 2000 9I
4 Corrected document 9F, 9P
5 DBTCN 9P
6 Duplicate response 9I
7 Filing status change 9P
8 Gambling losses on Schedule A 9F, 9P
9 RESERVED 9F, 9P
10 Income belongs to someone else 9F, 9P
11 Incorrect AUR processing 9P
12 Information requested from TP 9I
13 Information sent to TP 9I
14 Interest abatement 9P
15 Interest abatement denied 9N
16 MORT verified 9F, 9P
17 NEC included in partnership 9F, 9P
18 O/C W/H verified 9F, 9P
19 U/C W/H verified 9F
20 Refile signature document 9I
21 Refund allowed- W/H verified 9F, 9P
22 Release Freeze codes 9N
23 Retirement 9P
24 Schedule C Expenses 9F, 9P
25 Schedule D cost basis 9P
26 Schedule D losses 9F, 9P
27 Subsequent payment 9I
28 Other 9F, 9I, 9N, 9P
29 Copy of CP 2000 9F, 9I, 9P
30 Interest/Penalty abatement denied 9N

Exhibit 4.19.3-14 
Notice Delay Actions (Reconsiderations)

Current IDRS Status Description Cycles to Next Status Next Status STAUP Required to Stop Next Notices Remarks
12 Full paid or Credit None N/A N/A There may be accruals Check CC INTST
19 Balance Due before Due Date - MF Notice issued Later of: Return Due Date or 5 Cycles 20 STAUP20 1st IDRS notice will issue the later of 5 Cycles after MF Notice or Return Due Date
20 First IDRS Notice - 501 5 56 STAUP56  
21 Balance Due - MF Notice issued 5 20(IMF) 58(BMF) STAUP 20 STAUP 58 This status for MF notices after return due date
22 TDA Issued (ACS) Various 24 or 26 N/A Input TC 470.
23 Balance Below $1,000 tolerance (BMF); $1,500 (IMF) None N/A N/A MF Notice issued yearly Aggregate Balance below $1,000 (BMF); $1,500 (IMF)
24 TDA (Queue) Various 26 N/A Input TC 470.
26 TDA (CFF) None N/A N/A Input TC 470.
41/42 43/44 Stay of Collection Various 22 N/A  
47 Temp Collection Freeze - TC 470 26 or Manual Release Various N/A Review - Reinput TC 470 if required
48 Temp Notice Freeze - CCSTAUP # Input (1-15) As Requested Various Review - Update if required
50 Causes module to be accelerated to requested notice/TDA status # Input (0) Various N/A  
51 Undeliverable Notices 1 22 N/A  
53 Temp Collect. Frz TC 470 - cc 90/93 26 or Manual Release (ST58) 20 N/A Review - Reinput TC 470 if required
53 TC 530 Account Uncollectable Various 22 N/A  
56 Third IDRS Notice - 503 5 58 STAUP58  
58 Fourth IDRS Notice 504 6 22 or 23 or 26 STAUP22  
60/61 63/64 Installment Agreement Various Various Collection Branch Collection Branch
71 Offer in Compromise Various Various Collection Branch Collection Branch
72 Bankruptcy or other litigation Various Various Collection Branch Collection Branch
73 Coll/Offset Frz TC470 - CC99 Manual Release 58 N/A Freeze does not expire
76 Immediate TDA Pending 1 22 STAUP22 504 Notice & TDA next cycle
77 Accelerated TDA 3-8 58 STAUP58 504 is only IDRS notice
91 Criminal Investigation Various 22 CI Branch CI Branch
99 Out of service Center location Various Various   Review-input TC 470 if required

Exhibit 4.19.3-15 
Cycle Chart (Reconsiderations)

ACTION CYCLES
Closing case with a letter and a balance due will remain on the account 3-5
Closing case and action will resolve balance due 3
Routing correspondence or 1040X to another area and issuing a Letter 86C 9-15
Ordering documents from files 15
Sending correspondence for additional information 9-15

Exhibit 4.19.3-16 
Identity Theft Action Codes

Action Code Description
501 Indicates documented identity theft
504 Indicates documented identity theft that may not be applicable to AUR/U/R income.
505 Indicates IRS data loss incidents
506 Indicates IRS identified identity theft impacting Tax Administration.
522 with the literals INCOME, MULTFL, IMCMUL, NOFR or OTHER, Indicates receipt of substantiation documentation from the TP. This will alert other business operations that a claim of identity theft has been made and that substantiation documentation was received even if the case is still in progress.
522 with the literals PNDCLM, IRSID and NODCRQ Indicates the status of an in-process identity theft case
523 This indicator is applied to a potential identity thief’s account when IRS determines that the individual has been inappropriately using the SSN of a dependent. AC 523 does not indicate the TIN holder a victim of IDT.
524 Indicates the account has been locked to prevent any tax return from posting. AC 524 may not be currently associated with IDT.
525 This indicator is systemically applied to mark accounts of TIN owners whose number is reported on a Form W-2 attached to an to e-file return filed under an ITIN.

Exhibit 4.19.3-17 
Identity Theft -Tax Administration Source Terms and Descriptions

To facilitate effective identity theft case tracking and reporting, the Identity Protection office developed new Administration Source Fields used in certain circumstances, dependent upon the facts and circumstances of the case. The following table provides the Source Codes, their descriptions needed for IDRS input of TC 971 AC 522.

TERM/ACRONYM DESCRIPTION
PNDCLM Pending Allegation of identity theft - The TP makes an allegation of identity theft. The TP has not yet provided supporting documentation as required by IRM 25.23.2.18.2, Complete and Legible Documents, (Form 14039 or police report and personal identification) and/or identified, under signature, the AUR issues impacted by the IDT claim.
IRSID IRS identified incident of identity theft - During the normal course of business, the IRS suspects identity theft occurred and the case is not yet resolved.
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

Note:

Limited for use by HQ Policy analysts in CI, AUR, Pre-Refund Program (PRP), and TAP.

INCOME Acceptable Documentation Received from the Taxpayer - Reported under TP’s SSN without their consent or knowledge.
MULTFL Acceptable Documentation Received from the Taxpayer - Two or more returns filed for the same tax period under the same SSN.
NOFR Acceptable Documentation Received from the Taxpayer - Victim is not required to file a tax return.
INCMUL Acceptable Documentation Received from the Taxpayer - Both income reporting and multiple filings apply.
OTHER Acceptable Documentation Received from the Taxpayer - Situation does not relate to any existing Tax Administration Source types.

Exhibit 4.19.3-18 
Form 1040 Dotted Line Literals

The Form 1040 dotted-line literals, noted below, may display. (Not all displayed literals are applicable to AUR.)

Form 1040 Literals
Line 7 FB, DCB, FB and DCB
Line15b ROLLOVER, QCD, HFD
Line 16b ROLLOVER, PSO, ROLLOVER and PSO
Line 21 MSA, LTC, MEDMSA, HSA, FORM 8814, GAMBLING WINNINGS, NOL
Line 36 RFST, SUB-PAY TRA, UDC, 403(B), 501(c)(18)(D), PPR, WBF, MSA, Jury Pay
Line 43 CCF
Line 44 ECR
Line 56 (2013)
Line 57 (2014 and 2015)
F4029, F4361, or Exempt Community Income
Line 60(2013)
Line 62 (2014 and 2015)
EPP, UT, 453A( c), ADT, 72(M)(5), 453(L)(3), NQDC, ISC, HDHP, HSA, FITPP, LIHCR, ICR, FMSR, From FORM 8697, From FORM 8866, IECR, ECCFR, NMCR, MSA, MED MSA, AMVCR, COBRA, ARPCR, FORM 8834, FORM 8396, HCTC, 1260(B), S72P

Exhibit 4.19.3-19 
Filing Requirements for Most People

2015 Filing Requirements for Most People

If the filing status would be And the TP’s age at the end of 2015 would be* Then no filing requirement IF gross income is less than
Single
  • under 65

  • 65 or older

  • $10,300

  • $11,850

Married filing jointly**
  • under 65 (both spouses)

  • 65 or older (one spouse)

  • 65 or older (both spouse)

  • $20,600

  • $21,850

  • $23,100

Married filing separately any age $4,000
Head of household
  • under 65

  • 65 or older

  • $13,250

  • $14,800

Qualifying widow(er) with dependent child
  • under 65

  • 65 or older

  • $16,600

  • $17,850

* If the TP was born on January 1, 1951 they are considered to be age 65 at the end of 2015.

**If the TP did not live with their spouse at the end of 2015 (or on the date the spouse died) and gross income was at least $4,000, they must file a return regardless of age.

2014 Filing Requirements for Most People

If the filing status would be And the TP’s age at the end of 2014 would be* Then no filing requirement IF gross income is less than
Single
  • under 65

  • 65 or older

  • $9,750

  • $11,200

Married filing jointly**
  • under 65 (both spouses)

  • 65 or older (one spouse)

  • 65 or older (both spouse)

  • $19,500

  • $20,650

  • $21,800

Married filing separately any age $3,800
Head of household
  • under 65

  • 65 or older

  • $12,500

  • $13,950

Qualifying widow(er) with dependent child
  • under 65

  • 65 or older

  • $15,700

  • $16,850

* If the TP was born on January 2, 1950 they are considered to be age 65 at the end of 2014.

**If the TP did not live with their spouse at the end of 2014 (or on the date the spouse died) and gross income was at least $3,700, they must file a return regardless of age.

2013 Filing Requirements for Most People

If the filing status would be And the TP’s age at the end of 2013 would be* Then no filing requirement IF gross income is less than
Single
  • under 65

  • 65 or older

  • $9,750

  • $11,200

Married filing jointly**
  • under 65 (both spouses)

  • 65 or older (one spouse)

  • 65 or older (both spouse)

  • $19,500

  • $20,650

  • $21,800

Married filing separately any age $3,800
Head of household
  • under 65

  • 65 or older

  • $12,500

  • $13,950

Qualifying widow(er) with dependent child
  • under 65

  • 65 or older

  • $15,700

  • $16,850

* If the TP was born on January 2, 1949 they are considered to be age 65 at the end of 2013.

**If the TP did not live with their spouse at the end of 2013 (or on the date the spouse died) and gross income was at least $3,700, they must file a return regardless of age.

Exhibit 4.19.3-20 
Mandated IAT Tools

Action IAT Tool
AUR Reconsiderations xClaim
REQ54
REQ77
Address
Letters
ESTAB
Credit transfer
Fill Forms
Manual Refund
Stop Refund (CC NOREF)
Issue a Letter (unable to generate through AUR system) Letters tool
Make adjustment to TP account (unable to complete through AUR system) REQ54 tool
When TC 971, 972, 470, or 560 is needed REQ77 tool
Researching specific payments or a range of payments Payment Tracer
Ordering a return/document (unable to order through AUR system) ESTAB tool
Move payments Credit Transfer tool
Move credits to excess collections
Send a document to files ( Form 9856)
Fill Forms tool
Manual Refund Manual Refund

Exhibit 4.19.3-21 
Additional IAT Tools Available (Use Not Mandated)

  • Clerical Recon tool

  • Screening tool

  • Managers tool

  • Quick CC tool

  • Search 6209 tool

  • Prints tool

  • Tracer tool

Exhibit 4.19.3-22 
Examples of Self-Employment Income

This list is NOT all inclusive.

A
Accountant Actor/Actress Administrator Agent
Airplane Pilot Analyst Appraiser Architect
Art Worker Artist Athlete Auctioneer
Automatic Data Processing Equipment Operator      
B
Babysitter Baggage Porter Bailiff Baker
Bank Teller Barber Bartender Baseball player
Bellperson Billing Clerk Bookbinder Bowler
Brick Mason Brick Setter Broker Building Contractor
Bus Driver      
C
Cabinet Maker Caddie Cafeteria Worker Civil Engineer
Cleaner Clerk (any kind) Commercial Artist Commissions
Computer Operator Computer Specialist Conductor Construction Worker
Consultant Cook Cutter  
D
Dancer Data Processing Operator Decorator Designer
Dental Assistant Detective Dentist Director's Fees
Disc Jockey Domestic Cook Draftsman Dressmaker
Driver      
E
Economist Electrician Elevator Operator Engineer (any kind)
Engraver Entertainer    
F
Farmer Farm Worker Firefighter Football Player
Fortune Teller Freelance Writer Funeral Director  
G
Garbage Collector Gardener Gas Station Worker Geologist
Golfer Guard Guide  
H
Hairdresser Host/Hostess Hotel Worker Housekeeper
I
Inspector Instructor Interpreter Investigator
J
Janitor Jockey Judge  
K
Keypunch Operator      
L
Laborer Launderer Lawn Care Lawyer
Lay Midwife Librarian Library Assistant Longshore Worker
M
Mail Carrier Mail Clerk Mechanic Messenger
Metal Worker Miner Model Motion Picture Worker
Mover Musician    
N
Navigator Newspaper Carrier (18+ years old) Nurse Nursemaid
Nursery Worker      
O
Official (sports) Optical Worker Optician Optometrist
P
Painter Palmist Parking Lot Attendant Pharmacist
Photographer Pilot Plumber Police Officer
Pollster Porter Printer Proofreader
Protective Agency Publisher    
R
Radio DJ Railroad Conductor Railroad Worker Real Estate Worker
Receptionist Recreation Worker Registered Nurse Repairperson (any kind)
Reporter Retail Trader Roofer  
S
Sales Clerk Scientist (any kind) Sculptor Seamstress
Secretary Singer Sheriff Social Worker
Statistical Clerk Statistician Stenographer Steward
Stock Clerk Surgeon Surgical Worker Surveyor
T
Tailor Taxicab driver Teacher (any kind) Teamster
Telegraph Operator Telephone Operator Telephone Repairman Telephone Worker
Teller Textile Worker Therapist Timekeeper
Transcriber Trainer Translator Truck Driver
Tutor Typist    
U
Upholsterer Usher    
V
Veterinarian      
W
Waiter Waitress Washer Watchman
Welder Wholesale Trader Window Washer Writer
Y
Yardman      

INCOME THAT IS NOT SELF-EMPLOYMENT (This list is not all-inclusive.)

INCOME TYPES
Alimony Award Bingo Child support
ESOP Fellowship Gambling Grant
Jury Duty Newspaper Route (Under age 18) Prize Rebate
Scholarship Wages from Parent Wages from Spouse  

More Internal Revenue Manual