Purpose: To provide processing guidelines for the case building of cases involving Requests for Prompt Assessment under IRC 6501(d) (Form 4810) and Requests for Discharge from Personal Liability under IRC 2204 or IRC 6905 (Form 5495).

Audience: The primary users of this IRM are IRS employees in SB/SE Exam Classification Support who process Form 4810, Request for Prompt Assessment, and Form 5495, Request for Discharge from Personal Liability under Internal Revenue Code Section 2204 or 6905.

Form 4810, Request for Prompt Assessment, and Form 5495, Request for Discharge from Personal Liability under Internal Revenue Code Section 2204 or 6905, are routed at intake per IRM 3.10.72-1, Routing Guide/Local Maildex. If Classification Support receives a Form 4810 or Form 5495 that does not align with the routing guide, Classification Support will treat as a misroute and send to an appropriate campus.

Complete the initial review of the Form 4810 and/or Form 5495. Use the chart below if you determine the form is a duplicate request.

Review the boxes on the Form 4810 and Form 5495 that indicate if the requestor attached related documents. Review case contents for applicable forms, copies of the returns, letters of administration, letters of testamentary, or other related documents.

If the tax period ended on the Form 5495 or Form 4810 is for the “current year or immediately preceding the current year” and the tax period ended shown on the form is the same as the current calendar year (e.g. 202103 current calendar year is 2021) or the tax period ended shown on the form is the immediately preceding calendar year. (e.g. tax period ended 202103, current calendar year is 2022), reject the request. Refer to IRM 4.19.12.10, Rejecting the Case.

The request must specify the period(s) and type of tax covered. Verify the type of tax and tax periods involved, ensure the form is filed for an acceptable return. If the return is not an acceptable return, refer to IRM 4.19.12.10.1.7, Rejecting the Case.

Confirm the following information is present:

A valid Letter of Administration, Letter of Testamentary, etc. is required to verify authority to act on behalf of the taxpayer. Authorization may be granted by a court document signed by a court official with a state or county seal. Consider the following information when deciding if an authorization is valid:

Thoroughly review all other case documents.

Reject the request if it is made by a corporation, a dissolving corporation, or a corporation contemplating dissolution currently in a bankruptcy status. Bankruptcy status may be identified by a -V freeze code, a TC 520 with a bankruptcy closing code, for example 83/85/88, or it may be stated in the Letters of Testamentary or other court documents sent by the taxpayer. Under the US Bankruptcy IRC 505(b), prompt assessment is not available for chapter 13, chapter 7, or chapter 11. Refer to IRM 4.19.12.10.1.7, Rejecting the Case.

If any of the required information is missing or incomplete, refer to IRM 4.19.12.10.1.6, Missing or Incomplete Information.

Research IDRS CCs: SUMRY, ENMOD, INOLES, BMFOL/IMFOL, TXMOD, and any other applicable CCs.

Confirm the IDRS control was opened correctly when assigned. For example, the activity code accurately reflects the form(s) received, the received date indicates the oldest IRS received date, etc. Make corrections as needed.

Research entity information on CC ENMOD/ INOLES.

Verify all returns referenced have been filed and the TC 150 (original return) is posted.

Determine if a TC 976/977 (duplicate return) is present on TXMOD.

Identify balance due accounts.

Review the ASED. If the ASED on CC TXMOD has expired or will expire within 9 months (Form 5495) or 18 months (Form 4810) refer to IRM 4.19.12.10.1.9.1, Accept.

Research Freeze Codes. Refer to IRM 21.5.6.4, Freeze Code Procedures, to research freeze code conditions that may need to be resolved prior to referral.

Research other Transaction Codes (TC’s). Research the Document 6209 Code Retriever to identify unknown TCs and determine if additional research is necessary.

Resolve Multiple IDRS Control Bases.

If the TC 150 posted to the account but the taxpayer did not include a copy of their return with their prompt assessment request, access the following to locate the missing return:.

If the return is not available electronically through research conducted on EUP/MeF, CII, TRDBV or BRTVU, request the TC 150 from files using CC ESTAB.

Document all actions taken in the case documentation section of the database.

If a TC 976/977 (duplicate return) is present on IDRS refer to IRM 4.19.12.10.1.3, IDRS Research.

If a Form 4810 and/or Form 5495 is received and there is no TC 150 on IDRS, refer to the table below.

Use a Letter 621C, Prompt Assessment Request; Acknowledgement/Reply/Additional Information Requested, when corresponding for a Form 4810 and a Letter 738C, Decedent Income/Gift Tax Return; Personal Liability Discharge Request, when corresponding for a Form 5495.

When the original return is secured:

Summarize actions taken and letters sent in the case documentation section of the database.

If the request is incomplete or invalid for any reason and a determination could not be made through research, use the IAT Letters Tool, to send a Letter 621C, Prompt Assessment Request; Acknowledgement/Reply/Additional Information Requested for Form 4810 or Letter 738C, Decedent Income/Gift Tax Return; Personal Liability Discharge Request, for Form 5495, to request the missing or incomplete information.

Suspend the case for 60 days.

Update the IDRS control base activity to SUSPNDMMDD.

When all required contents are received, review for accuracy, notate in case documentation and continue processing. Refer to IRM 4.19.12.10.1.8, Classification Referrals.

If the taxpayer does not respond, reject the case. Refer to IRM 4.19.12.10.1.7, Rejecting the Case.

If the taxpayer responds to the inquiry after the suspense has expired and the case has been closed, work the case as a new request. Refer to IRM 4.19.12.10.1.2, Initial Review.

Send a Letter 621C, Prompt Assessment Request; Acknowledgement/Reply/Additional Information Requested, for Form 4810 or Letter 738C, Decedent Income/Gift Tax Return; Personal Liability Discharge Request, for Form 5495, to reject the case back to the taxpayer. Provide an explanation of why the form is being rejected.

Circle out the received date and any other IRS notations in red and attach a copy of the Form 4810 and/or Form 5495 to the letter.

Detach copies of envelopes, duplicate IRS letters, copies of electronic returns and/or IDRS prints. Identify they can be destroyed by writing a large "X" on the top page of the prints and placing them in a classified waste bin.

Update the IDRS control base activity to RJECT for each affected tax period.

Enter case notes in the case documentation section of the database summarizing case actions, identify/mark which letter was sent, and press the close button for each tax form and period addressed.

Ensure any original returns included with the request or previously requested from files are sent to processing or refiled.

Ensure the case is completely built before sending to Classification to be classified as Accept/Reject/Select.

Update the IDRS control base activity to FULLPKG.

Follow local routing procedures to route to Classification.

Classification will classify the case and return it to Classification Support with a determination.

Classification Support will take the following actions based on the Classifier’s determination:

Purpose: The instructions in this subsection are used to process Form 8282, Donee Information Return, as part of the Form 8282 /Form 8283, Non-cash Charitable Contribution match program. The program screens for potential selection for audit. Cases are selected when non-cash contribution deductions do not meet the criteria established for substantiation. Cases may be selected for Area Office or Campus Exam.

Audience: CEFS Classification Support executes the Form 8282 / Form 8283 Match Program under direction from Exam Quality and Technical Support (EQTS). CEFS Policy HQ analyst has oversight for the program and coordinates technical issues with EQTS.

Process new receipts of Form 8282, Donee Information Return, as follows:

If a Form 8283 is received by itself, associate it with the original return.

In accordance with IRC 6050L(a), if a charitable organization sells, exchanges, or otherwise disposes of charitable deduction property within 3 years after its receipt, the organization must file a Form 8282, Donee Information Return, containing the following information:

If the TIN is missing or incomplete, take the following actions:

If the Form 8282 is incomplete or invalid, based on the form instructions, and a determination could not be made through research, send a letter to request the missing or incomplete information when needed.

Create an IDRS Control Base with an activity code of FORM8282.

Suspend the case for 30 days by updating the IDRS control base activity code to SUSPNDMMDD (MMDD = 30 days from the date the letter was generated).

If response to the letter is not received within 30 days, send a second letter requesting the information and update the IDRS control base activity code to SUSPNDMMDD (MMDD = 30 days from the date the letter was generated).

If no response is received, close the IDRS control base with activity code NORESPONSE.

If all required contents are received, review for accuracy and continue processing.

If the missing or incomplete information cannot be obtained, input the Form 8282 into the database as received.

Once verified as accurate and complete, enter the Form 8282 into the Form 8282 database.

Form 8282 database entry must include the following information:

The Form 8282 database is a local database maintained by the Ogden Campus Exam. Access is approved through Ogden Campus Exam Planning and Analysis staff.

Classification is completed in EQTS. If EQTS contacts Classification Support to build selected cases, take the actions outlined in this IRM.

The EQTS classifier will provide Classification Support with a completed Form 6754, Examination Classification Checksheet.

Research IDRS to identify if an AIMS base is open.

Verify completeness of the Form 6754, Examination Classification Checksheet, by ensuring the following notations are present:

After verifying the completeness of the Form 6754, Examination Classification Checksheet, take the following actions:

When the retention period expires, complete Form 11671, Certificate of Records Disposal for Paper or Electronic Records, to obtain approval to destroy or delete the data, form, etc.

LIHTC forms can be received via the Digital Mobile Adaptive Form (DMAF) platform or via a paper form. If the form is received through DMAF, follow the DMAF User Guide to download the form for processing.

Below is an explanation of each form processed by the LIHTC unit.

Form 8610, is filed by HFA’s to transmit Form 8609 Part 1 and Form 8610 Schedule A. It is used to report the credit dollar amount allocated during the year under IRC 42 and projects financed by tax-exempt bonds subject to the volume caps under IRC 146. It also provides a reconciliation of the HFA’s credit ceiling allocations and reports all properties subject to the compliance monitoring requirements.

Form 8610, Schedule A, is completed and filed by the housing credit agency to report a carryover allocation of a low-income housing credit. A Schedule A is completed for each carryover allocation.

Form 8609 Part I, Low-Income Housing Credit Allocation, is used by the housing credit agency to allocate credits within their jurisdiction to specific projects.

Form 8823, is filed by HFA’s to notify the IRS of noncompliance with IRC 42 compliance monitoring requirements or to report a low-income building disposition.

Upon receiving a Form 8610 package from the HFA, follow the procedures listed below:

Input the Form 8610, Part II into the database ensuring the current tax year version of the form is being used by the HFA.

Input the Form 8610 Part III items into the database ensuring the current tax year version of the form is being used by the HFA.

After all appropriate information is entered into the database, run a reconciliation report. If discrepancies are identified, double check your input.

If there are still discrepancies, attempt to determine the specific forms causing the issue. If the discrepancy is not easily identifiable, use a Tableau report of all the related inputs to attempt to identify inconsistent, or inaccurate information. Then work with the HFA to resolve any form corrections.

Form 8610 follow-up with the HFA

LIHTC tax examiners will review Forms 8610 Schedule A for accuracy, completeness, and that the allocation was made in year that corresponds to the Form 8610 year. Forms 8610 Schedule A is to be filled out completely by the HFA.

All amended Forms 8610 Schedule A received with the current year Form 8610 package should be researched to verify the year of the allocation matches the Form 8610 year, either the current year, or a prior year, before entering them into the database. If a Form 8610 Schedule A has an allocation date in a prior year, but it is not in the database for the appropriate calendar year, then contact the LIHTC Program Analyst for guidance.

Input all Forms 8610 Schedule A into the database associated with the current year Form 8610.

Form 8609, Low-Income Housing Credit Allocation and Certification, Part I, is to be entered separately from Form 8609 Part II

When an original and amended Form 8609 Part 1 for the same building are received with the current year Form 8610 package, verify the form count included only the amended Form 8609 Part 1 that pertains to the current year Form 8610. In addition, attach the original Form 8609 Part I to the back of the amended Form 8609 Part I for information only. In this situation, it is not necessary to input the original Form 8609 Part I because the amended will overwrite the information anyway.

Review Form 8609 Part I to ensure the Amended box or Addition to Qualified basis box are input based on the filed form. If the addition to Qualified Basis box is checked, the Form 8609 Part I information will not overwrite a previously input Form 8609 Part I for the same building that has been entered into the database. The Form 8609 with the Addition to Qualified Basis box checked is an additional allocation of credit to the same building for costs incurred after the first year of the credit period.

If you receive only an amended Form 8609 Part I for a building with the current year Form 8610 package and you verify by conducting a search on the CDE database that an original Form 8609 Part I was not previously filed, then only input the amended Form 8609 Part I and verify the form count on the Form 8610 includes it.

When an HFA amends a current year Form 8609 Part I prior to the Form 8610 filing due date, they should include the amended form with the Form 8610 package, attach the original to the amended, and only count the amended form in the form count and dollar amounts, not both forms. (Exception: When both the Amended Form and the Addition to Qualified Basis boxes are checked, then both forms need to be input if they belong with the current year Form 8610 package. Input the original first, then the amended. The database in this instance knows to not override the original form information.)

If an original Form 8609 Part I related to a specific building was already submitted for a prior year based on your search of the LIHTC CDE Database, contact the HFA to amend the current Form 8610 to exclude the Form 8609 Part I from the count. In addition, verify the information on the newly filed form matches the Form 8609 Part I data in the LIHTC CDE Database.

Once the correct Form(s) 8609 Part I have been identified for input associated with the current year Form 8610, LIHTC examiners should take the following actions:

The CDE system will provide a Reconciliation worksheet for the Form 8610, the attached Form 8610 Schedule A and Form 8609 Part 1 information returns filed with Form 8610.

Follow the Steps below to review Form 8609 Part II, for correctness, completeness (including appropriate attachments when required), and the taxpayer’s signature.

If the TIN in Part I Box C does not match the TIN at the bottom of the form, then enter the form into the database and no letter to the taxpayer is required. Enter the reported information related to the TIN.

Review Line 7 to ensure the Eligible Basis amount is shown, it is not zero, and it is not less than the amount on Line 8a. If the amount shown on Line 7 is blank, zero, or less than the amount on Line 8a, then send the Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for correction of the Form 8609.

Review Line 8a to ensure the original qualified basis of the building at the close of the first year of the credit period information is shown. If Line 8a amount is greater than Line 7 amount, zero, or blank, then send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for correction.

If Line 8b is checked "Yes" then ensure the list of all buildings is included as part of the Multiple Building Project attachment. If no attachment, or incomplete, then send a Letter 6386,Taxpayer Made a ‘Yes” Election on Line 8b. but Failed to Provide Attachment Listing Buildings, to the taxpayer requesting the list of buildings.

If Line 8b is checked "No" but there is an attachment with a list of buildings that may be part of a multiple building project, then send a Letter 6387, Taxpayer Made an Inconsistent Election on Line 8b, to the taxpayer. Send the letter for a determination if they intended that the list of buildings was attached, and they should have checked the Box 8b "Yes" .

If Line 8b "Yes" and "No" boxes are not checked, then send a Letter 6385, Taxpayer Failed to Make an Election on Line 8b, to the taxpayer for correction.

If Line 6a or 6d box is checked and there is no box checked for Line 9a, then send a Letter 6389, Taxpayer Failed to Make an Election on Line 9a, to the taxpayer for correction.

If neither Line 6a or Line 6d box is checked by the HFA to identify credit allocations to federally subsidized buildings, and Line 4 is zero, then the taxpayer may either (1) check neither box, or (2) check the "no" box on Line 9a. Either choice is acceptable.

If neither Line 6a or Line 6d box is checked and Line 4 is zero, then there is no consequence if a taxpayer checked "yes" on Line 9a, and no contact with the taxpayer is required. However, the selection is inconsistent with the information in Part I when Line 6a, or 6d box is not checked. The HFA should be contacted to confirm that the filing of Form 8609, Part I, is correct as not federally subsidized. The HFA can be contacted by telephone or letter. If written documentation is desirable, the request for confirmation can be made in writing. See Letter 6388, Confirmation of Federal Financing, requesting confirmation that the property was federally subsidized, or not. An amended Form 8609, Part I should be filed by the HFA if the property was actually federally subsidized and the Line 6a, or 6d box should have been checked. If the property is not federally subsidized per the HFA, but the Line 9a "Yes" box was checked, then contact the LIHTC Program Analyst for assistance.

If the taxpayer attempts to change an election on line 8b, 9a, or 9b, send them the Letter 6390, Attempt to Revoke Election, and notify the SB/SE LIHTC Program Analyst.

If Line 9b, box "Yes" is checked, input the check box as reported and contact the SB/SE LIHTC Program Analyst.

If Line 10a is not checked, then send the Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for them to make an election. The election is irrevocable once made, so the taxpayer cannot change it. If the taxpayer attempts to change an election on line 10a, notify the SB/SE LIHTC Program Analyst.

If Line 10c does not have a box checked then send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for them to make an election. If the checked box is inconsistent with the building location (i.e. 25-60 box checked, but building is not located in NYC) then contact the SB/SE LIHTC Program Analyst. The election is irrevocable once made, so the taxpayer cannot change it. If the taxpayer attempts to change an election on line 10c, contact the SB/SE LIHTC Program Analyst.

If the form has no signature, then send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for correction.

If the printed name is unreadable, then send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for correction.

If no TIN is identified in Part II, then use the TIN for the taxpayer shown in Form 8609 Part I for correction and no letter is required.

If no date is listed in Part II, then use the date one week before the envelope postmark date or "Received" date stamp.

If the First Year of Credit Period is blank send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, for correction.

If the First Year of Credit Period is not the same as the Placed in Service (PIS) Year, Line 5, then Box 10a must be checked "Yes" and the year should be the year following the PIS Year. If checked "No" or the year is incorrect then send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for correction unless the "Exception" applies.

If the First Year of Credit Period is the same as the Placed In-Service Year, Line 5, then Box 10a must be checked "No" . If checked "Yes" or not checked, send a Letter 6391, Form 8609 Part II Incomplete or Inconsistent Submission, to the taxpayer for correction unless the "Exception" applies.

All initial letters related to corrections of the Form 8609 Part II by a taxpayer have a 60 day follow up date. A calendar reminder should be input for 60 days after the letter is sent with the original Form 8609 Part II enclosed for correction.

If there is no response from the taxpayer to the initial 60 day letter, then make one more attempt to contact them for the Form 8609 Part II correction with another 60 day follow up response date.

If there is no response after the second correction letter attempt, then refer the taxpayer to the LIHTC Senior Program Analyst for a final demand letter.

When inputting Form 8609 Part II, the applicable percentage on Line 2 of the Form 8609 should correspond with the election on Line 6, the credit allocation type. For a 9% applicable percentage on Line 2, the credit allocation type will always be 6b. New Building, Not Federally Subsidized, or 6e. Rehabilitation, Not Federally Subsidized.

When a Form 8823 is received with, or without the 2D barcode, the form should be reviewed for the following specific actions taken:

INSTALLING SCANNER:

STEP BY STEP SCANNING AND E-FAX INSTRUCTIONS:

PAPER FORMS:

The FCS Program Analyst will notify the examiner when a Form 8823 package is needed for building the examination case which includes the forms and attachments. Scan the Form 8823, Form(s) 8609, and any correspondence with the taxpayer and upload it to the For Classification Folder on the LIHTC SharePoint. Directions for scanning can be found in the attached document.

Requirements for a complete LIHTC case sent to classification:

DELETING RECORDS

Only the LIHTC Manager and LIHTC Program Analyst can delete records in rare circumstances when significant errors have occurred. Below are the only types of records that can be deleted:

Records in a reconciled status cannot be deleted. The user must first un-reconcile the Form 8610 package before a Form 8610 Schedule A or Form 8609 Part I, record can be deleted.

WHEN DOES A RECORD NEED TO BE DELETED? Before deleting a record, a thorough review should be performed by the tax examiner to determine if the record needs to be deleted. The CDE application includes system protections against users entering duplicate records. If a user attempts to enter a duplicate record, the system will provide a warning message about a duplicate record based on the duplicate fields for each record type. The record the user has entered cannot be saved unless one of the duplicate fields are changed. However, if a user changes one of the duplicate fields, a new record is saved, and this record may now be an erroneous record since the user may have forced the system to save the record instead of the user making an update to a previously saved record. Below are some examples of when a record may need to be deleted from the database: