4.103.1 CDE Application and Procedures

Manual Transmittal

February 26, 2021

Purpose

(1) This transmits a revision of IRM 4.103.1, Compliance Data Environment (CDE), CDE Application and Use and renames it to Compliance Data Environment (CDE), CDE Application and Procedures.

Material Changes

(1) This IRM updates IRM 4.103.1 Compliance Data Environment (CDE), CDE Application and Procedures; and incorporates IRM 4.103.2 Compliance Data Environment (CDE), CDE Procedures; and 4.103.3 Compliance Data Environment (CDE), CDE Roles and Reports. IRM 4.103.2 and 4.103.3 will be obsolete concurrently with the publication of this revision.

New IRM Reference Change Details
4.103.1 Changed section title from CDE Application and Use to CDE Application and Procedures.
4.103.1.1 Added a new section called Program Scope and Objectives, per IRM 1.11.2.2.5. Updated Authority, Responsibilities, Program Reports, Acronyms, Terms, and Related Sources into new section titled: Program Scope and Objectives.
4.103.1.1.1 Moved from old 4.103.1.1 (1), Overview, and updated to include electronically assign returns to examiners, upload to RGS, and LIHC.
4.103.1.1.2 Incorporated IRM 4.1.5.1.2 (10-20-2017), Authority, and added IRM 1.1.16.4.1.6, Examination Systems & Projects.
4.103.1.1.3 Added Responsibilities, per IRM 1.11.2.2.5.
4.103.1.1.3 (1) Moved from old 4.103.1.6.1, Director, SB/SE Examination.
4.103.1.1.3 (2) Moved from old 4.103.1.6.2, SB/SE Examination, Exam Operations Support (EOS) and updated to change title to SB/SE Exam Operations Support, Technology Solutions.
4.103.1.1.3 (3) Moved from old 4.103.1.6.3, CDE Development Center, and updated for organizational change to ES & P. Removed -Collecting user suggestions for system enhancements. Replaced -Maintaining Security certification and accreditation" with FISMA Updates Removed -extracts and replaced with data, inserted ES & P data. Removed -Maintaining the CDE website.
4.103.1.1.3 (4) Moved from old 4.103.1.6.4 (1) SB/SE Examination, Exam Planning and Delivery (EPD) and updated for office title change from EPD to ECS.
4.103.1.1.3 (5) Moved from old 4.103.1.6.4 (2) SB/SE Examination, Exam Planning and Delivery (EPD) and updated per 4.1.5.1(4) Program Scope and Objectives and updated title change to FSC, see 4.1.5.1.3(2).
4.103.1.1.3 (6) Moved from old 4.103.1.6.5 Area PSP Territory manager and updated per 4.1.5.1.3(3) Responsibilities; Removed -Collecting user suggestions for system enhancements. Removed approve user access to CDE roles - replaced by OL5081 approvals.
4.103.1.1.3 (7) Moved from old 4.103.1.7 CDE Security and updated to remove old Missions Assurance Cybersecurity Office.
4.103.1.1.3 (8) Moved from old 4.103.1.6.6 PSP Coordinator.
4.103.1.1.4 Added Program Management and Review, per IRM 1.11.2.2.5.
4.103.1.1.4 (1) Moved from old 4.103.3.2 (1).
4.103.1.1.4 (2) Moved from old 4.103.3.2 (2) Updated to add reports available using a stand alone program.
4.103.1.1.4 (3) Updated to add reports available using Tableau.
4.103.1.1.4 (4) Added to summarize all reports.
4.103.1.1.5 Moved from old 4.103.1.4 Requesting Access and moved from old 4.103.2.2.
4.103.1.1.5 (2) Moved from old IRM 4.103.1.4 (1) and updated.
4.103.1.1.5 (3) Moved from old 4.103.1.7.1(1) (removed "Access to return data on the users local machine is restricted") and updated for parallel structure.
4.103.1.1.6 Moved from old Exhibit 4.103.1-1 Glossary of Terms; renamed to Terms and updated to add new terms.
4.103.1.1.7 Moved from old Exhibit 4.103.1-2 and updated to include new acronyms.
4.103.1.1.8 Added new section -Related Resources.
4.103.1.2 Incorporated old 4.103.1.1 (1)-(5) and updated to replace ISS with IEP; removed reference to Midwest Automated Compliance System; added electronic delivery and assignment; LIHC.
4.103.1.3.1 Incorporated old 4.103.1.1.1 and updated to replace CBRS with FinCEN; added electronic delivery; LIHC; document attachment; XML.
4.103.1.3.3 Moved from old 4.103.1.1.2.
4.103.1.3.5 Added LIHC data.
4.103.1.4 Moved and updated old 4.103.1.4 to include old 4.103.2.2. Part of old 4.103.2.2 was a duplicate of 4.103.1.1.5 (1).
4.103.1.5 Old 4.103.1.2 was a summary section of roles and no longer needed. Moved from old 4.103.3.1 with no changes.
4.103.1.6.1 Moved from old 4.103.3.1.1 and updated to include: creating workload sets by XML file; adding additional classification coordinator; attaching documents to a case file or workload set; updated positions.
4.103.1.6.2 Moved from old 4.103.3.1.2 and updated to add additional classification coordinators and attach additional documents.
4.103.1.6.3 Moved from old 4.103.3.1.3 and changed CBRS to FinCEN.
4.103.1.6.4 Moved from old 4.103.3.1.4 and updated reviewer feedback and IRM citation.
4.103.1.6.5 Moved from old 4.103.3.1.5 and added -to deliver and release electronic delivery sets; and attach additional documents.
4.103.1.6.6 Moved from old 4.103.3.1.6 with no changes.
4.103.1.6.7 Moved from old 4.103.3.1.7 and updated to add non-filer strategy sets.
4.103.1.6.8 Moved from old 4.103.3.1.8 with no changes.
4.103.1.6.9 Moved from old 4.103.3.1.9 and updated to change(2) to Technology Solutions staff.
4.103.1.6.10 Moved from old 4.103.3.1.10 and updated to Technology Solutions staff and to add additional classification coordinators.
4.103.1.6.11 New CDE role, CDE group manager.
4.103.1.6.12 New CDE role, CDE examiner.
4.103.1.6.13 New CDE role, LIHC user.
4.103.1.6.14 New CDE role, LIHC manager/analyst.
4.103.1.7 Moved from old 4.103.3.2.
4.103.1.7.1 Moved from old 4.103.3.2.1.
4.103.1.7.2 Moved from old 4.103.3.2.2.
4.103.1.7.3 Moved from old 4.103.3.2.3.
4.103.1.7.4 Moved from old 4.103.3.2.4.
4.103.1.7.5 Moved from old 4.103.3.2.5.
4.103.1.7.6 Moved from old 4.103.3.2.6.
4.103.1.7.7 Moved from old 4.103.3.2.7.
4.103.1.6.1 Replaced old 4.103.3.28 ad hoc reports with Tableau.
4.103.1.7.3 Moved from old 4.103.1.3 and removed CDE extract requests.
4.103.1.7.4 Moved from old 4.103.1.3.1 and updated for non-filer sets and attached documents.
4.103.1.9.3 Moved from old 4.103.1.3.2 and updated terminology and removed market segment analysis.
4.103.1.9.5 Moved from old 4.103.1.3.3.
4.103.1.9.7 Moved from old 4.103.1.3.4 with no changes.
4.103.1.7.5 Moved from old 4.103.1.3.5 with update for electronic delivery.
4.103.1.7.6 Moved from old 4.103.1.3.6 and updated IRM references.
4.103.1.10 Moved from old 4.103.2.1.
4.103.1.10.1 Moved from old 4.103.2.3 and updated. Form 6356 is not used for CDE.
4.103.1.10.2 Moved from old 4.103.1.3.7 and change title to CDE Research Request Overview; deleted (1) and (2) and added old 4.103.2.4.
4.103.1.10.2.1 Moved from old 4.103.2.4.1.
4.103.1.10.2.2 Moved from old 4.1032.4.2.
4.103.1.10.2.3 Moved from old 4.103.2.5.3.
4.103.1.10.3 Replaced old 4.103.2.5 CDE extract request and old 4.103.1.3.8 with ES & P data request form.
4.103.1.10.4 Moved from old 4.103.2.13 and changed form title and CDE helpdesk email address.
4.103.1.10.5 Moved from old 4.103.2.6 and added accepted as filed reason code and survey reason code.
4.103.1.10.5.1 Moved from old 4.103.2.6.1.
4.103.1.10.5.2 Moved from old 4.103.2.6.2.
4.103.1.10.5.3 Moved from old 4.103.2.6.3.
4.103.1.10.5.3.1 Moved from old 4.103.2.6.3.1.
4.103.1.10.5.3.2 Moved from old 4.103.2.6.3.2.
4.103.1.10.6 Moved from old 4.103.2.7. Changed audit trail file to SAAS log file.
4.103.1.10.7 Moved from old 4.103.2.8.
4.103.1.10.8 Moved from old 4.103.2.9.
4.103.1.10.9 Moved from old 4.103.2.10.
4.103.1.10.10 Moved from old 4.103.2.11.
4.103.1.10.11 Moved from old 4.103.2.12 and changed IRM cite.
4.103.1.11 Moved from old 4.103.1.5.
4.103.1.12.1 Moved from old 4.103.1.5.1 and changed CDE helpdesk email address and links.
4.103.1.12.3 Moved from old 4.103.1.5.2 and updated reference sites.
4.103.1.12.5 Moved from old 4.103.1.5.3.

(2) Editorial changes made throughout the IRM include updating organizational titles, and correcting grammar and web links.

Effect on Other Documents

This supersedes IRM 4.103.1 dated May 17, 2011.

Audience

Small Business and Self Employed (SB/SE), Wage and Investment (W&I), and Large Business and International (LB&I) employees who use the CDE application.

Effective Date

(02-26-2021)

Robin L Kidwell
Director, Technology Solutions
Small Business/Self Employed Division

Program Scope and Objectives

  1. Purpose: This Internal Revenue Manual (IRM) section provides information about the Compliance Data Environment (CDE) software program. It describes:

    • Data available in CDE

    • CDE roles and uses

    • Procedures for requesting access and help

    • Operating procedures for CDE users

    • Reports available

  2. Audience: Small Business and Self Employed (SB/SE). Wage and Investment (W & I) and Large Business and International (LB & I) who use the CDE application..

  3. Policy Owner: Exam Case Selection (ECS) is under Headquarters Examination.

  4. Program Owner: Exam Systems and Projects (ES & P) is under Technology Solutions

  5. Primary Stakeholders: SBSE Examination, Exam Case Selection (ECS) and Exam Systems and Projects (ES & P)

  6. Program Goals: The policies and procedures contained in this IRM provide IRS Examination business units with processes and procedures in CDE for workload identification, selection, classification, delivery and assignment of returns; queries of tax return data; and input, storage and retrieval of Low Income Housing Credit (LIHC) data.

Background

  1. Compliance Data Environment (CDE) is a workload identification, planning, and delivery system that operates in a web-based environment. It is used to filter, order, classify, deliver returns and electronically assign returns to examiners for upload to RGS. It also provides a secure environment for input and data retention of the LIHC program data.

Authority

  1. IRM 1.1.16.3.5.3, Exam Case Selection.

  2. IRM 1.1.16.4.1.6, Examination System & Projects

  3. IRM 1.2.1.2.36, Policy Statement 1-236, Fairness and Integrity in Enforcement Selection.

  4. IRM 1.2.1.5.7, Policy Statement 4-9, Highest Integrity Expected.

  5. IRM 1.2.1.5.10 , Policy Statement 4-21, Selection of Returns for Examination.

Responsibilities

  1. The Director, SB/SE Examination is the owner of CDE. The office of the Director, SB/SE Examination is responsible for setting national standards and policies for the implementation and operation of CDE. It is responsible for providing staffing and funding for the ongoing operation of CDE.

  2. The Director, SB/SE Exam Operations Support (OS), Technology Solutions (TS) has overall authority and responsibility for the security and proper operation of CDE. TS ensures national guidelines and standards are met:

    1. Security requirements are met and continuously maintained with support from SB/SE Business Systems Planning (BSP).

    2. Privacy and disclosure safeguards are met.

    3. All Information Technology (IT) policies and standards are followed.

    4. TS provides program direction, oversight, and monitoring of Exam Systems and Projects (ES & P)

  3. The Director, Exam Systems & Projects (ES & P) is responsible to the Director of Technology Solutions for the development, enhancement, and maintenance of CDE. This includes:

    • Researching and designing CDE

    • Analyzing and testing program changes to update and improve the system

    • Establishing user requirements

    • Prioritizing change requests based on user input and system/resource limitations

    • Gathering, verifying and correcting system defects

    • Providing FISMA updates to System Security Plan and Information System Contingency Plan

    • Ensuring CDE is 508 compliant with each release

    • Producing data for approved ES & P data requests

    • Maintaining a database with the most current data available

    • Providing e-mail assistance to CDE customers

    • Participating in user meetings and conference calls upon request

    • Working with other business units

    • Informing users and other internal customers of system changes and other developments of interest or importance

  4. Director, Exam Case Selection (ECS) is responsible for providing policy guidance, assistance and oversight to the areas and campuses.

  5. Program Manager, Field Case Selection (FCS) is the program manager responsible for providing guidance on the selection of cases and delivery of inventory for SB/SE Field Exam. FCS serves as a liaison between CDE users and ES & P on policy related issues.

  6. The PSP (Planning and Special Programs) Territory Manager (TM) is responsible for the selection of cases and delivery of inventory within their exam area. The responsibility for the proper use and administration of CDE includes the following:

    • Ensuring CDE printers are located in secured areas

    • Ensuring security incident and integrity procedures are followed

    • Ensuring headquarters policies and procedures are followed

    • Approving research requests

    • Approving access to IRS employee returns

  7. The Director, Security Operations & Standards Division, Associate Chief Information Officer (ACIO) certifies CDE operates within all IRS security parameters.

  8. The PSP coordinator responsibilities are dependent on their authorized CDE user role. A coordinator's responsibilities can include the following:

    • Developing compliance projects designed to identify noncompliant taxpayers and preparers.

    • Coordinating classification, case building and assignment of CDE returns.

    • Preparing and analyzing the appropriate CDE reports to manage and maintain CDE inventory and monitor classification details.

    • Providing area profiles.

    • Promoting awareness of CDE as a compliance system through presentations, memorandums, local procedural documents and individual assistance.

    • Serving as a point of contact for program related inquiries and providing technical, clerical and managerial personnel with instruction, guidance and feedback on program operations.

Program Management and Review

  1. The following program reports can be generated in CDE:

    • Inventory Report

    • Select Rate Report

    • Statute Report

    • Strategy Sets Report

    • Filter Summary Report

    • Filter Stratification Report

    • Filter Sample Utility Report

  2. Only certain CDE users can create these reports.

  3. Other reports can be created outside of CDE, using a stand alone program linked to specific data exported by CDE.

  4. The reports can be used to analyze inventory, classification selection, issue identification, surveys, and other trends related to the selection of inventory.

Program Controls

  1. Access to CDE is through the Employee User Portal(EUP). Request this access first.

  2. Then submit an Online 5081 for the requested user roles. See IRM 4.103.1.4 CDE Roles for examples of the roles.

  3. Security features include:

    • Restricting accesses to authorized individuals.

    • Logging and monitoring accesses.

    • Maintaining audit trails.

    • Identifying employee returns to allow appropriate handling.

    • Setting Negative TIN (Taxpayer Identification Number) Check (NTC) procedures in place to restrict users from inappropriate access.

Terms

  1. This table lists commonly used terms in CDE and their definitions.

    Term Definition
    Additional Data Includes FinCEN, IDRS, third party data (data from an asset locator/people locator electronic service and available with allocated funding), K-1’s and related returns (payer and payee).
    Attached Documents Attached case file documents include white papers, amended returns, taxpayer correspondence, or other relevant information. Workload creators, classification coordinators and delivery coordinators can attach documents.
    CDE Facsimile Tax return information from the CDE database in a one or three year format
    Case File A case file consists of a 1 year CDE facsimile or a 3 year comparative CDE facsimile. It can also include additional data, if ordered by the workload creator or strategy creator, plus attached documents
    Case File ID A unique identification number assigned to each case file by CDE. It cannot be changed.
    Case File List The case file list for a classifier contains Electronic Case Files (ECFs) they have classified. For a reviewer, it displays classified ECFs by all classifiers assigned to a workload set. For CDE group managers, it displays all electronically delivered ECF by PBC/SBC/EGC. For examiners, it displays all assigned case files.
    Deletion Set Case files or workload sets deleted (surveyed) by the virtual inventory administrator in CDE.
    Deletion Set ID A unique identification number assigned to each deletion set by CDE. It cannot be changed.
    Deletion Set List A listing of all deletion sets containing AIMS errors in CDE for the virtual inventory administrator.
    Delivery Set A group of case files that are delivered for examination. A delivery set is identified by workload set, criteria search, or specific TIN.
    Delivery Set ID A unique identification number assigned to each delivery set by CDE. It cannot be changed.
    Delivery Set List A listing of all delivery sets created by a specific delivery coordinator.
    Electronic Case File (ECF) Contains a cover sheet, 1 or 3 year CDE facsimile return, an electronic classification check sheet, and additional data (if ordered), plus attachments.
    Electronic Classification Check sheet (ECC) An ECC is an electronic version of a classification check sheet.
    Elimination Filter An elimination filter is used to query a filter result set and remove the rows from that result set that meet (or don't meet) the criteria for the elimination filter definition.
    Execution Filter An execution filter is used to query the entire CDE database and create a filter result set with the tax returns that meet the criteria of the execution filter definition.
    Filter A series of one or more Boolean statements used to identify returns with a specified characteristic or group of characteristics.
    Filter Result Set A filter result set is a set of tax returns created when a user executes an execution filter or uploads a TIN list.
    Non-Filer Strategy Set A non-filer set is a set of case files created by a csv TIN list. Case files in a non-filer set are not classified. Non-filer sets are printed. Non-filer sets are used to validate a return was not filed and to gather additional data options.
    Profile A summary of one or more significant filing characteristics of a population.
    Sample Seed A number representing the starting point in the random number sequence for the statistical sampling process. A sample seed value is used to initialize a random number generator. A filter creator can specify a seed value to randomly select returns from each filter stratum. The same sample result can be recreated using the seed number if recreated using the same filter result set and stratification. CDE creates the seed value if no seed value is specified.
    Spigot Return Classification Coordinator
    Strategy Set Strategy sets are used to validate current strategies and create new strategies. Case files in a strategy set are not classified or moved to virtual inventory. Once CDE builds the case files and external data is retrieved (if requested), the strategy set is ready for printing.
    Strategy Set ID A unique identification number assigned to each strategy set by CDE. It cannot be changed.
    Strategy Set List A listing of all strategy sets created by a specific strategy creator.
    Strategy Set Name A name, number or combination of both that is input when the strategy set is created.
    T-Account A list of sources and applications of funds compiled from transcribed tax return information for IMF returns.
    TIN Upload Filter A TIN upload filter is a type of execution filter created by uploading a TIN list, comparing the TINs to the tax returns in the CDE database and returning a filter result set with the tax returns that match the TINs in the list.
    Transcribed Data Information transcribed from the return into a database during tax return processing at the submission processing campus.
    Virtual Inventory The population of Electronic Case Files (ECF) selected for Exam through CDE. Case files are stored in virtual inventory until delivered or deleted.
    Workload Set A workload set is a set of electronic case files created by a workload coordinator and managed by assigned classification coordinators. The case files are classified online through CDE. When classification is complete, the case files selected for audit are moved to virtual inventory for later delivery (or deletion).
    Workload Set ID A unique identification number assigned to each workload set by CDE. It can’t be changed.
    Workload Set List A listing of all workload sets created by a specific workload creator.
    Workload Set Name A name, number or combination of both that is input when the workload set is created.
    XML File File format used by workload creators to create multiple workload sets.

Acronyms

  1. This table lists commonly used acronyms and their definitions.

    Acronym Definition
    ACIO Associate Chief Information Officer
    AGI Adjusted Gross Income
    AIMS Audit Inventory Management System
    BOD Business Operating Division
    BSP Business Systems Planning
    CDE Compliance Data Environment (CDE)
    CIP Compliance Initiative Project (Program)
    DIF Discriminant Function (DIF)
    ECC Electronic Classification Checksheet (ECC)
    ECS Exam Case Selection
    EGC Employee Group Code (EGC)
    EIN Employer Identification Number
    ERCS Exam Return Control System
    ES & P Exam Systems and Projects
    EUP Employee User Portal (EUP)
    FCS Field Case Selection
    FinCEN Financial Crimes Enforcement Network (FinCEN)
    GSS General Support System (GSS)
    IDRS Integrated Data Retrieval System (IDRS),
    IEP Integrated Enterprise Portal
    IRM Internal Revenue Manual
    IRS Internal Revenue Service
    IT Information Technology
    LB & I Large Business and International
    LIHC Low Income Housing Credit
    NAICS North American Industry Classification System
    PBC Primary Business Code
    POD Post of Duty (POD)
    PSP Planning and Special Programs (PSP)
    PSSN Primary Social Security Number
    PTIN Preparer Tax Identification Number
    RGS Report Generating Software
    RPP Return Preparer Program
    RTF Returns Transaction File (RTF)
    SB/SE Small Business and Self Employed
    SBC Secondary Business Code (SBC)
    SEID Standard Employee Identifier (SEID)
    TC Transaction Code (TC)
    TCO Tax Compliance Officer (TCO)
    TIN Taxpayer Identification Number (can be an individual or a corporate entity)
    TM Territory Manager
    TS Technology Solutions
    VI Virtual Inventory
    VIA Virtual Inventory administrator (VIA)
    W & I Wage and Investment
    XML Extensible Markup Language

Related Resources

  1. IRM 4.1.2, Workload Identification and Survey Procedures

  2. IRM 4.1.5, Case Building, Classification, Storage and Delivery

  3. Electronic Delivery SharePoint

  4. CDE SharePoint (will require approval to access.)

Overview

  1. Compliance Data Environment (CDE) is a workload identification, planning, and delivery system that operates in a web-based environment. It is used to filter, order, classify, deliver and assign returns.

  2. CDE utilizes the Integrated Enterprise Portal (IEP) General Support System (GSS) infrastructure to provide secured web-enabled access to its users through the Employee User Portal (EUP). The system architecture for CDE includes the use of a Business Logic server and Database servers (MITS-30) that physically reside at an Enterprise Computing Center.

  3. CDE is a secure, centralized database supplementing the current Planning and Special Programs (PSP) return ordering and classification process.

  4. CDE automates the classification process and provides a single source for all information required for workload management. CDE provides the information required to classify a return including a three-year return facsimile, entity data, related tax returns, and related information from external sources. Updates are automatically sent to AIMS. This on-line system incorporates an Electronic Classification Checksheet (ECC).

  5. Returns are identified and delivered in Discriminant Function (DIF) descending order.

  6. Returns may be delivered and assigned electronically.

  7. CDE provides a secure environment for access to a database server for the LIHC (Low Income Housing Credit) program. CDE provides a user interface for data input, storage and retrieval.

Benefits of CDE

  1. Some benefits of CDE are:

    • Streamlines the audit workflow, supports workload identification and delivery for both DIF and strategic initiatives

    • Provides a 3 year return facsimile, entity information, preliminary Cash T-Account and related returns

    • Obtains information from outside sources - Integrated Data Retrieval System (IDRS), Financial Crimes Enforcement Network (FinCEN) , and Third Party Data (with approved funding)

    • Allows attachment of white papers, amended returns, and taxpayer correspondence

    • Allows for on-line classification and review of returns reducing travel for classification details

    • Provides "just-in-time" inventory delivery (returns can be delivered in days instead of months)

    • Provides for faster input of returns into the audit stream

    • Allows users to create a workload set or strategy set from a filter result set

    • Allows a campus user to create a TC424 request file or tickler file from a filter result set

    • Provides a paperless process

    • Allows for printing of case files to designated network printers or electronic delivery

    • Allows for online case file assignment to examiners

    • Allows examiners to download CDE case files and upload them directly to RGS

    • Provides a secure environment for access to a database server for the LIHC (Low Income Housing Credit) program

    • Allows additional documents to be added to case files

    • Allows creation of multiple workload sets with one XML file

Tax Return Data Available

  1. Data is available for the most current year and prior three years.

  2. The following return types are available:

    • 1040 series

    • 1120 series

    • 1120S

    • 1065 series

    • 1041 series

  3. The CDE database contains tax return data from the return posted to Master File using Transaction Code (TC) 150. Subsequent amendments, duplicates, claims, etc., are not included in the database.

  4. Tax return data refers to those lines that are transcribed at the campus during processing (located in the Returns Transaction File (RTF)), as well as certain information from the Master File such as Post of Duty (POD), date of birth, audit history, and DIF score.

Low Income Housing Credit Data Available

  1. Data is available for the most current year and prior years per Document 12990, Records and Information Management Records Control Schedules, which directs IRS functions on record retention and disposition. The LIHC tax forms are addressed in this document and each have their own computed compliance schedule of retention and disposition.

  2. The following LIHC forms are input into the database:

    • Form 8610, Annual Low-Income Housing Credit Agencies Report

    • Form 8610 Schedule A, Carryover Allocation of Low-Income Housing Credit

    • Form 8609, Low-Income Housing Credit Allocation and Certification

    • Form 8823, Housing Credit Agencies Report of Noncompliance or Building Disposition

  3. The LIHC database contains tax form data transcribed by the LIHC data entry team.

Access to CDE

  1. A CDE user is an individual who has been granted authority to access CDE. No one may conduct any type of research on CDE until they have been established as a user by the CDE user administrator. The individual will be set up as an area user, national user, or campus user and will only have access to applicable data.

  2. Access to CDE is a two step process:

    1. Register with the Employee User Portal (EUP)

    2. Then complete an Online 5081, Information System User Registration/Change Request (https://ol5081.enterprise.irs.gov/ ),

    1. CDE delivery coordinator, CDE group manager, and CDE examiner roles require your Primary Business Code (PBC), Secondary Business Code (SBC) and Employee Group Code (EGC.)

  3. For each CDE session, users are required to log into the EUP to access CDE with their Standard Employee Identifier (SEID) and password. Users are responsible for all their activities performed in CDE.

CDE Roles

  1. Each user in CDE is assigned a role based on the Online 5081 submitted. Multiple roles may be submitted for each user. The CDE staff approves the user role for the employee based on the information provided on the Online 5081. The role determines what icons are enabled for the user.

  2. Each user is assigned to a single employee type. CDE requires the BOD code for each employee type. The employee type determines if the user is a national user, campus user or area user and access to CDE data is restricted based on the employee type.

Workload Creator

  1. Workload creators begin the return identification process by identifying workload either by criteria search, TIN list upload, or XML file. After the workload creator inputs and saves a new workload set, the classification coordinator takes over responsibility for the classification and review process.

  2. It is recommended the role of workload creator be assigned to the positions commonly referred to as:

    • PSP Spigot/DIF coordinator(s)

    • Other PSP coordinators

  3. The workload creator duties within CDE include:

    • Creating workload sets

    • Assigning classification coordinators to manage each workload set

    • Adding additional classification coordinators to a workload set

    • Attaching documents to a case file or workload set

Classification Coordinator

  1. The classification coordinator manages the progress of workload sets, through CDE from the time the workload sets are created until moved to virtual inventory.

  2. It is recommended the role of classification coordinator be assigned to the positions commonly referred to as:

    • Returns coordinator

    • Returns classification coordinator (e.g. CIP, RPP, PSP coordinators)

  3. The classification coordinator duties within CDE include:

    • Ensuring new classifiers and reviewers obtain timely access to CDE

    • Assigning classifiers and reviewers to CDE workload sets

    • Training new classifiers and reviewers in the use of CDE

    • Monitoring the progress of CDE classification details

    • Auto-classifying returns, as appropriate

    • Moving workload sets to Virtual Inventory (VI)

    • Addressing CDE AIMS AM424 errors that may occur

    • Adding additional classification coordinators to a workload set

    • Attaching documents to a workload set or case file

Classifier

  1. The classifier classifies tax returns assigned within the CDE system. The classifier can be assigned to classify one or more CDE workload sets.

  2. It is recommended the role of classifier be assigned to the positions commonly referred to as:

    • Revenue agent

    • Tax compliance officer

    • Returns coordinator

    • Returns classification coordinator (e.g. CIP, RPP, PSP coordinators)

  3. The classifier duties within CDE include:

    • Online classification of CDE returns which includes reviewing IDRS, FinCEN, third party data (when funding is available), related returns and K-1's, if ordered for classification, and any attached documents.

    • Making a determination to either "Accept as Filed" or "Select for Audit"

    • Completing the Electronic Classification Checksheet (ECC) for each selected return

    • Selecting a "Type of Work" Employee Group Code (EGC) for each selected return

    • Inputting comments on the ECC for all accepted returns

  4. The classifier is responsible for following National SB/SE Classification Guidelines.

Reviewer

  1. The reviewer evaluates a sample of classified returns in each workload set and determines whether the classifier made an appropriate decision to select or accept the return.

  2. The CDE ECC includes a section for reviewer Feedback. This reviewer feedback section should include comments related to the return and issues only and not specific evaluative feedback to the classifier. Form 5126, Classification Quality Review Record, is to be used for evaluative feedback to classifiers. Classifiers will receive an e-mail on any comments included in the reviewer feedback section. It is recommended that the reviewer maintains a spreadsheet of reviewed returns with the information which will be required to complete the Form 5125. They will need to review 10% of each classifiers classified returns.

  3. It is recommended the role of reviewer be assigned to the positions commonly referred to as:

    • Returns coordinator

    • Returns classification coordinator (e.g. CIP, RPP, PSP coordinators)

    • PSP section chief

    • Group manager

  4. The reviewer duties within CDE include:

    • Reviewing CDE classified returns

    • Ensuring the classifier has selected a "Type of Work" EGC for all classified returns

    • Determining whether the classifiers’ decisions are correct

    • Reviewing a minimum number of classified returns (per national guidelines). See IRM 4.1.5.3.3, Review of Classification.

    • Completing Form 5126, Classification Quality Review Record, for each classifier

    • Notifying the classification coordinator when a workload set is completed. CDE sends an e-mail notification to the classification coordinator after the first case file is reviewed.

Delivery Coordinator

  1. The delivery coordinator delivers the case files once the workload sets are moved to VI.

  2. The delivery coordinator role can only be assigned to an area user or campus user. An area delivery coordinator can only deliver returns in their area. A campus delivery coordinator can only deliver case files from workload sets created by campus workload coordinators within their same BOD.

  3. It is recommended the role of delivery coordinator be assigned to the positions commonly referred to as:

    • Returns coordinator

    • Returns classification coordinator (e.g. CIP, RPP, PSP coordinators)

    • Tax examiner

    • Management/Program assistant

  4. The delivery coordinator duties within CDE include:

    • Delivering CDE case files by: workload set, criteria search, or individual cases

    • Building/assembling case files

    • Delivering and releasing electronic delivery sets

    • Reprinting the delivery set or the delivery set Form 3210, if needed

    • Viewing the delivery sets

    • Addressing CDE AIMS AMSTU errors that may occur

    • Attaching additional documents to workload sets, case files or delivery sets

Virtual Inventory Administrator

  1. The Virtual Inventory Administrator (VIA) manages the CDE virtual inventory. Case files selected for audit and moved to VI by the classification coordinator, sit in a virtual shelf until ready for delivery. Case files that are not delivered by the delivery coordinator remain in VI until the VIA deletes (surveys) them.

  2. The VIA role can only be assigned to an area user or campus user. An area VIA can only delete case files in workload sets created by workload creators in their area. A campus VIA can only delete case files in workload sets created by campus workload coordinators within their same BOD.

  3. It is recommended the role of VIA be assigned to the positions commonly referred to as:

    • Returns coordinator

    • Returns classification coordinator (i.e. CIP, RPP, PSP coordinator, etc.)

    • PSP section chief

    • Tax examiner

    • Management/Program assistant

  4. The VIA duties within CDE include:

    • Monitoring inventory in appropriate employee group codes using the CDE or AIMS reports

    • Deleting excess CDE inventory in VI (short statute cases or cases no longer needed)

    • Reprinting CDE case files

    • Retrieving the "Status of TIN" when there are questions on the status of specific cases in CDE

    • Addressing CDE AIMS AMSOC errors that may occur

Strategy Creator

  1. A strategy creator creates a strategy set by entering the required information and uploading a TIN list. The TIN list is created in an external text file. TIN lists can be for CIPs, RPPs, training returns, employee audits, other strategic initiatives and to get supplemental case building information on previously built returns. AIMS controls are not requested for tax returns included in a strategy set. However, CDE can check for AIMS controls, if requested.

  2. A strategy creator can create a non-filer set by entering required information and uploading a csv file. The non-filer set builds a case file for each TIN and specified tax years where no return is filed. AIMS controls are not requested for tax returns included in a non-filer set.

  3. It is recommended the role of strategy creator be assigned to the positions commonly referred to as:

    • Returns coordinator

    • Returns classification coordinator (i.e. CIP, RPP, PSP coordinator, etc.)

    • Tax examiner

    • Tax examining technician

    • Management/Program assistant

    • Audit aide

    • Program analyst

  4. The strategy creator duties within CDE include:

    • Creating a TIN list using Notepad, if needed

    • Converting a TIN list from Excel, if needed

    • Creating a TIN list using Excel csv file for non-filers

    • Creating strategy sets and non-filer sets

    • Requesting case building information

    • Printing/Viewing strategy sets and non-filer sets

    • Creating strategy set reports

    • Managing strategy sets

Filter Creator

  1. The filter creator creates, executes, tests, analyzes, and modifies Filters in CDE.

  2. It is recommended the role of filter creator be assigned to the positions commonly referred to as:

    • Returns Coordinator

    • Returns Classification Coordinator. (i.e. CIP, RPP, PSP Coordinator, etc.)

    • Tax Analyst

    • Program Analyst

  3. The filter creator duties within CDE include:

    • Creating a filter by either copying existing filters, creating a new filter , or uploading a TIN list

    • Running an execution filter which will search the entire CDE database and find all returns that meet the filter criteria

    • Running a test execution filter which will search the CDE database and find the first 25 returns that meet the filter criteria

    • Analyzing filter result sets by creating and reviewing CDE stratification, summary, and sample utility reports

    • Analyzing case files identified by the sample utility report to determine if the filter is identifying cases meeting the filter criteria

    • Creating and running an elimination filter to reduce the size of or eliminate specific criteria from the execution or test execution filter result set

    • Using the filter result set to create either a strategy set or a workload set. Campus filter creators can use the filter result set to create a tickler file or a TC424 request file.

User Administrator

  1. A user administrator manages the user profiles within CDE.

  2. The user administrator role can only be assigned to the Technology Solutions staff..

  3. The user administrator duties within CDE include:

    • Creating CDE user profiles

    • Updating CDE user profiles

    • Disabling CDE user profiles

    • Assisting users with their profiles

System Administrator

  1. A system administrator handles access for printers used within CDE to print delivery sets, strategy sets, case files and CDE reports.

  2. The system administrator role can only be assigned to the Technology Solutions staff..

  3. The system administrator duties for CDE include:

    • Setting up user printers

    • Updating user printers

    • Disabling user printers

    • Adding additional classification coordinators to a workload set

  4. The system administrator can run all CDE reports at the national level.

CDE Group Manager/Proxy

  1. The CDE group manager/proxy assigns electronic case files to examiners in their group.

  2. It is recommended the role of CDE group manager/proxy be assigned to the positions commonly referred to as:

    • Group manager

    • Group clerk, management assistant, secretary or anyone else acting in an assistant to the manager role

    • Acting group manager

  3. The CDE group manager/proxy duties pertaining to electronic case file delivery:

    • Assigning case files to examiners

    • Reviewing delivery sets and case files

    • Monitoring inventory for timely downloads by examiners

    • Surveying case files from CDE

    • Updating assignment/survey information on ERCS

CDE Examiner

  1. The CDE examiner downloads assigned electronic case files for upload to RGS

  2. It is recommended the role of CDE Examiner be assigned to the positions commonly referred to as:

    • Revenue agent

    • Tax compliance officer (TCO)

  3. The CDE examiner duties pertaining to electronic case file delivery:

    • Reviewing assigned CDE case files

    • Downloading assigned CDE case files

    • Uploading CDE case files to Report Generation Software (RGS)

LIHC User

  1. The LIHC user inputs data from LIHC Forms 8610, 8610 Schedule A, 8609 Part 1 and Part 2, and 8823 into the CDE LIHC database.

  2. It is recommended the role of LIHC user be assigned to the positions commonly referred to as:

    • Tax examining technician in LIHC unit at the Philadelphia campus

    • Anyone who is helping to input form data.

  3. The LIHC user duties within CDE include:

    • Entering and updating data from the LIHC tax forms

    • Viewing LIHC tax forms

    • Reconciling Form 8610 and its attached Forms 8610 Schedule A and Forms 8609 Part 1

    • Accessing CDE reporting functions

LIHC Manager/Analyst

  1. The LIHC manager/analyst manages the LIHC data input process. This may include the input of data from LIHC forms.

  2. It is recommended the role of LIHC manager/analyst be assigned to the positions commonly referred to as:

    • Unit Manager

    • Department Manager

    • Headquarters Analyst

    • LIHC Subject Matter Expert

  3. The LIHC manager/analyst duties within CDE include:

    • Entering and updating data from the LIHC tax forms

    • Viewing LIHC tax forms

    • Reconciling Form 8610 and its attached Forms 8610 Schedule A and Forms 8609 Part 1

    • Accessing CDE reporting functions

    • Viewing/printing other tax forms in the CDE databases

    • Deleting erroneous LIHC records

Reports

  1. The following reports are generated in CDE:

    • Inventory report

    • Select rate report

    • Statute report

    • Strategy sets report

    • Filter summary report

    • Filter stratification report

    • Filter sample utility report

  2. Only certain CDE users can create these reports.

Inventory Report

  1. The inventory report lists the case files in CDE VI. An inventory report example can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. The classification coordinator, delivery coordinator, or VIA can create an Inventory report.

  3. The inventory report can be used for the following:

    • To analyze available returns by POD

    • To analyze available returns by grade of case

    • To analyze returns by type of case

    • To analyze inventory by activity code

    • To analyze aging of inventory

Select Rate Report

  1. The select rate report provides select rates for inventory in active workload sets, VI or both. Training returns can be either included or excluded from the report. A select rate report example can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Only the classification coordinator can create a select rate report.

  3. The select rate report can be used for the following:

    • To monitor the select rates of specific inventory

    • To evaluate the efficiency of classifiers

    • To determine the number of returns to order

    • To determine the select rate of each activity code for ordering purposes

Statute Report

  1. The statute report provides the VIA with a listing of CDE cases with short statute dates. A statute report example can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Only the VIA can create a statute report.

  3. The statute report can be used for the following:

    • To monitor pending statutes

    • To determine what returns need to be deleted

    • To monitor returns in each Employee Group Code (EGC)

    • To compare to AIMS Table 4.1, List of Returns with Statute Date Pending, and fix any variances

Strategy Sets Report

  1. The strategy sets report provides a list of strategy sets that have been created in CDE. An area or campus report will only include strategy sets created for their specific area or campus location. A national user can create reports that include all strategy sets created in CDE. A strategy sets report example can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Only the strategy creator can create a strategy sets report.

  3. The strategy sets report can be used for the following:

    • To monitor the type of work created by the strategy creators

    • To determine how many strategy sets were created by strategy creators

    • To see how many returns were created in each strategy set

Filter Summary Report

  1. A filter summary report provides an overview of returns in a filter result set. This report does not provide any taxpayer identifying information. It summarizes the filter return counts based on non-dollar fields showing the total and average dollar amount for each group. For example, a report analyzing total income may be summarized by activity code. The report will show one line for each activity code with the total income for each activity code, total number returns in each activity code and the average income per return. A filter summary report example can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Only the filter creator can create a filter summary report.

Filter Stratification Report

  1. A filter stratification report is used to analyze the data in a filter result set. It is the process of grouping tax returns in a filter result set, into homogeneous groups or tiers, also known as stratums. This report does not provide any taxpayer identifying information. A filter stratification report example can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Only the filter creator can create a stratification report.

Filter Sample Utility Report

  1. A filter sample utility report generates a TIN list after a filter has been stratified. The user may choose to select either all returns or a statistical sample. The returns in each stratum of the TIN list are in numerical order by TIN. A filter sample utility report example can be found in the CDE website "Job Aids" folder at hhttp://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Only the filter creator can create a sample utility report.

Tableau Reports

  1. CDE Tableau is a stand-alone (off-the-shelf) program linked to specific CDE and LIHC data exported by CDE. Approved users run analytical reports based on the CDE or LIHC data. Tableau produces weekly and monthly reports regarding inventory, four of the standard reports available in CDE, and allows users to create ad hoc reports through flexible query of the data. Request access through OL5081, PROD ELEV CDE TEV (TABLEAU ENTERPRISE VISUALIZATION-CDE TEV).

CDE Uses

  1. CDE can be used for the following:

    • Case building - Both filers and non-filers

    • Analyzing populations

    • Identifying issues

    • Classifying returns

    • Delivering returns

    • Filtering

    • CDE research requests

    • Inputting and retrieving LIHC data

    • Assigning case files to examiners

Case Building

  1. Case building provides additional information related to a tax return for both filed and non-filed returns. The following information is available to order in CDE:

    • CDE facsimile (The CDE facsimiles resemble original tax returns in a 1 year format or 3 year comparative format.) CDE facsimiles in non-filer sets include the tax year before or after the non-filed year.

    • Related returns

    • K-1's

    • Third party data (with available funding)

    • IDRS

    • FinCEN data

    • Attached documents

Population Analysis

  1. A population analysis is a summary of one or more significant filing characteristics of a population of returns. It is limited to the information contained in the CDE database.

  2. CDE can analyze actual return filings of areas by the makeup of their populations. Understanding the characteristics of a filing population can improve the processes of allocating resources, developing outreach activities, and identifying filing trends.

  3. National users can analyze a multi-area or national level.

  4. Some analysis examples are:

    • Return type analysis by Post of Duty (POD). For example, it can identify the number of 1040, 1120, 1065, 1120S and 1041 returns filed by POD and activity code. An analysis indicating a large increase in the number of 1120S filings could indicate a change from 1120 to 1120S returns and a need to reallocate resources to 1120S audits.

    • Trend analysis. For example, the number of returns with Schedule A’s, Earned Income Credit, foreign earned income, businesses with losses, etc. can be identified through this type of population analysis.

Issue Identification

  1. CDE can identify returns containing specific issues. For example, all returns in a specific market segment with a net profit percentage of less than 5 percent.

  2. CDE can statistically stratify a filter result set as well as generate a random sample of returns for testing. The filter result set can be used to create a workload set, a strategy set, or a TC424 request file or tickler file for campus use.

  3. A Compliance Initiative Project (CIP) is required for all CDE identified projects. The exception is for any group of taxpayers that fall within an issue, strategy, or workstream specifically identified on a business operating unit's annual work plan for examination or compliance check. See IRM 4.17, Compliance Initiative Projects for CIP procedures and information.

Classification of Returns

  1. CDE is used for the online classification of returns. It contains the current processing year and 3 prior years data. It allows for a 3-year comparison of the taxpayer's return information (if it is available and ordered for classification). The multi-year comparison gives the classifier a better financial overview of the taxpayer, improving the selection process.

  2. Through the CDE system, returns are identified and classified for various programs including, but not limited to the following:

    • DIF

    • Training

    • CIP

    • Return Preparer Program (RPP)

  3. When classifying individual returns, CDE can be used to view the K-1's received by that individual and also the related business returns of the K-1 payer, if ordered for classification.

  4. When classifying business returns, CDE can be used to view the K-1's issued by the business, and the related shareholders’ or partners’ (payee) returns, if ordered for classification.

Delivery of Returns

  1. CDE is used to deliver returns to a network printer or electronically to a CDE group manager from the CDE virtual inventory. A user can:

    • Deliver an entire workload set.

    • Deliver case files by criteria search.

    • Deliver a single case file.

    • Reprint a delivery set.

    • Reprint a delivery set 3210.

Filtering

  1. Filters allow CDE filter creators to run queries against tax returns (individuals, business or trust) in the CDE database, then further refine the results of the queries by eliminating tax returns from the results with additional queries. A filter is a set of conditions against which all returns in the filing population are compared. CDE allows users to design filters to identify groups of returns containing particular issues or characteristics. For example, filtering may be used:

    • To identify returns with potential for specific issues.

    • To identify returns by a preparer for a RPP.

    • To identify returns for a CIP.

  2. CDE has the following thresholds when filtering:

    • Four filters can be run concurrently. If 4 filters are already in process, the 5th filter will go into a queue until 1 of the 4 is finished.

    • The maximum number of returns identified by a filter is 500,000.

    • The maximum time a filter will run is 24 hours.

  3. The following Filters can be created in CDE:

    • Execution filter - An execution filter is used to query the CDE database, which contains the current processing year and prior three years Return Transaction File (RTF) data plus related Master File data. When the filter is executed it creates a filter result set with all tax returns that meet the criteria of the execution filter definition.

    • Test filter A test filter is an execution filter with the filter result set being limited to the first 25 returns that meet the filter criteria.

    • Taxpayer Identification Number (TIN) upload- A TIN upload filter is used to identify a set of tax returns by uploading a TIN list. A filter result set is created by matching the TIN list against the tax returns in the CDE database. Instructions discussing the required TIN list format can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

    • Elimination filter - An elimination filter is applied to a filter result set (execution filter or TIN upload) to remove specified returns from the filter result set. More than one elimination filter can be applied to a filter result set. Elimination filters can be saved and reused and also be applied to other filter result sets.

  4. A filter result set can then be used to create a:

    • Filter summary report - See IRM 4.103.1.5.5, Filter Summary Report.

    • Filter stratification report - See ,IRM 4.103.1.5.6, Filter Stratification Report.

    • Filter sample utility report - See IRM 4.103.1.5.7, Filter Sample Utility Report.

  5. After the filter results and reports have been analyzed, the user can create a workload set or strategy set from the filter result set. Campus users can also create a TC424 request file or tickler file.

  6. Filter results sets are maintained on the system for two weeks and are automatically deleted if not accessed within this time. If the filter result set is deleted, the filter can be re-executed to create a new filter result set.

TC424 Request and Tickler Files
  1. Campus filter creators can create a TC424 request file for tax returns identified in a filter result set or sampled filter result set.

  2. TC 424 requests can not be created from a test execution filter result set.

  3. TC 424 requests can not be created for business or trust filter result sets.

  4. The TC424 request file is used by the campus to further analyze the filter result set data. CDE creates the file and transfers it to another campus system for processing.

  5. The following information is required when inputting a TC424 request file:

    • Campus code

    • Source code

    • Project code

    • Employee group code

    • Charge-out/label indicator (0 = Original return, charge-out label, 1 = Charge out and label only, 3 = No return, charge-out label)

    • Push code indicator

  6. The following information is provided by CDE for each tax return in the filter result set when CDE creates a TC424 request file:

    • TIN

    • TIN type (0 = valid Social Security Number (SSN), 1 = invalid SSN)

    • Name control

    • Tax period

    • Business Operating Division (BOD) code

TC424 Request File
  1. Campus filter creators can create a TC424 request file for tax returns identified in a filter result set or sampled filter result set.

  2. TC 424 requests can not be created from a test execution filter result set.

  3. TC 424 requests can not be created for business or trust filter result sets.

  4. The TC424 request file is used by the campus to further analyze the filter result set data. CDE creates the file and transfers it to another campus system for processing.

  5. The following information is required when inputting a TC424 request file:

    • Campus code

    • Source code

    • Project code

    • Employee group code

    • Charge-out/label indicator (0 = Original return, charge-out label, 1 = Charge out and label only, 3 = No return, charge-out label)

    • Push code indicator

  6. The following information is provided by CDE for each tax return in the filter result set when CDE creates a TC424 request file:

    • TIN

    • TIN type (0 = valid Social Security Number (SSN), 1 = invalid SSN)

    • Name control

    • Tax period

    • Business Operating Division (BOD) code

Tickler File
  1. Campus filter creators can create a tickler file for tax returns identified in an execution filter result set.

  2. Tickler files can not be created by a test execution filter result set.

  3. Tickler files can not be created for business or trust filter result sets.

  4. The tickler file is used to further filter the returns through a process performed outside of CDE. CDE creates the file and transfers the file to another system from which the user can securely access it for processing.

  5. The following information for each tax return in the filter result set is provided when CDE creates a tickler file:

    • Primary Social Security Number (PSSN) (9 digit primary TIN)

    • PSSN type (0 = valid SSN, 1 = invalid SSN)

    • Secondary Social Security Number (SSSN) (9 digit secondary TIN)

    • SSSN type (0 = valid SSN, 1 = invalid SSN)

    • Name control

    • Tax period

    • BOD code

    • Activity code

    • Document Locator Number (DLN)

    • Filing status

    • Preparer Employer Identification Number (EIN)

    • Preparer SSN

    • Preparer Tax Identification Number (PTIN)

    • PTIN - Indicator (PTIN - IND)

    • Electronic filing indicator (ELF- IND)

    • Total Positive Income (TPI)

    • Adjusted Gross Income (AGI)

    • Total deductions - Schedule A

    • Child Tax Credit

    • Additional Child Tax Credit

    • Dependent SSN1

    • Dependent SSN2

    • Dependent SSN3

    • Dependent SSN4

    • State income/Sales tax

    • State income/Sales tax indicator

    • Moving expense

    • Other income/Sales tax indicator

    • Other income - Form 1040

    • Lifetime learning credit

    • Hope learning credit

Filtering Techniques
  1. When creating an execution filter, include "Common Favorite Fields" and only a few other lines of criteria to make the filter process faster. Then create and apply an elimination filter to remove returns and further refine the filter result set.

    Note:

    "Common Favorite Fields" are frequently used indexed fields that allow CDE to process filters faster.

  2. Each field in a filter definition must be identified by the exact name used in the CDE data dictionary. Fields are classified as individual, business or trust in the filter definition (e.g. the field AGI is only used in an individual filter definition). To find the name for a field:

    • Click the "Find Criteria Field" icon to access a look up window containing form, fields and field definitions or

    • Start typing the field name and a list of options appears in a drop down list.

  3. Use the following operators when creating execution filters and elimination filters:

    • = (equal to)

    • > (greater than)

    • < (less than)

    • >= (greater than or equal to)

    • <= (less than or equal to)

    • <> (not equal to)

  4. The following values are used when creating execution and elimination filters:

    • Numeric fields - e.g. AGI or number of dependents

    • Code fields - e.g. activity codes and North American Industry Classification System (NAICS) codes

    • Date fields (MM/DD/YYYY) - e.g. 06/04/2009

    • Cycle fields (YYYYWW) - e.g. 200949 for the 49th week of 2009

    • Tax periods (YYYYMM) - e.g. 200912 for December 2009

    • Year (YYYY) - e.g. 2009

  5. Each line of an execution filter or elimination filter is connected to the next line with either an AND or an OR operator. If AND is used, a return must meet both criteria to be selected. If OR is used, a return must meet one of the criteria to be selected. When using AND and OR statements within a filter, it is imperative that parenthesis be used to group each of those statements to ensure proper order. It is also recommended that the AND statements be entered at the top of the filter and the OR statements at the bottom. The last line of the filter is followed by an END operator.

  6. A "CDE Filtering Best Practices" document, which contains additional filtering tips and filter examples can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

CDE Procedures

  1. This section contains operating procedures for CDE users. These procedures apply to all persons authorized to access CDE. They may also apply to others who use CDE information.

  2. CDE users are prohibited from accessing information not needed to perform official duties. Unauthorized access to accounts is a fundamental violation of the public trust in the confidentiality of returns and return information, one of the foundations of sound tax administration and public confidence in that system. It also violates both privacy and disclosure rules and may result in removal from the service and/or criminal prosecution.

DIF Order Approval

  1. Areas should submit a Return Needs Analysis, or equivalent, which must be approved prior to creating any DIF workload sets. See IRM 4.1.2.9, Guidelines for Ordering Returns, for more information.

CDE Research Request Overview

  1. A CDE research request is required for all filtering requests.

  2. Research is defined as any filter activity on the CDE system. All filtering on CDE requires a signed CDE research request except:

    • Case building for returns already on AIMS.

    • DIF classification.

    • Form 5346, Information Reports and Other Type Referrals.

    • Periodic validity testing of new data or program updates.

    • Subsequent repetitive profiling requests.

  3. Minor modifications may be made to the original research request without submitting a new request. This should be documented by notation or addendum to the request form. Minor modifications must not change the intent of the original request. Examples of minor modifications include:

    • Extension to other years

    • Refinements of dollar criteria

    • Expansion to other PODs

Research Request Approval Process
  1. All CDE research requests should first be submitted to the requester’s manager for approval. The approved request will then be routed to the PSP TM or delegate for signature. If the requester is a first line manager or above, the research request may be routed directly to the PSP TM or delegate for signature.

  2. All CDE research requests from outside of SB/SE Examination should first be submitted to the requester's manager for approval. The request will be routed through appropriate channels to the servicing PSP TM.

  3. CDE research requests containing taxpayer identifying information must be routed securely (e.g. secure messaging).

  4. A request originating within PSP may have the same person provide both levels of authorization. CDE users will not be allowed to authorize, even in an acting managerial capacity, any CDE research requests which will be assigned to them.

  5. Once the PSP TM or delegate approves the request, it is routed to the headquarters, Exam Case Selection (ECS) analyst for approval. After national approval the research request will be sent to the requesting PSP.

CDE Research Request Form
  1. Research is requested using the CDE research request form. The following information should be included on the request form:

    • Name of requester

    • Date of request

    • Group

    • POD

    • Telephone number

    • Manager signature and date

    • PSP/Campus compliance signature

    • Type of research requested

    • Type of return

    • Tax period(s)

    • Explanation of information requested

      Note:

      The explanation should be specific and identify issues to be researched. Factors to consider or include when preparing this section are: tax periods or file years to be researched, appropriate data fields and filter logic required, and geographic areas for inclusion.

    • TIN, if appropriate

  2. The CDE research request form can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/exam/tip/cde/jobaids/default.aspx.

Paper Trail and Retention
  1. The research request form should include the:

    • Date received

    • Date assigned

    • Assigned filter creator name

    • CDE ID number and

    • CDE filter name

    to maintain an audit trail and support research conducted on CDE.

  2. CDE security requires documentation be kept for a period of six years. This includes the original approved research request forms along with modifications and addenda.

Exam System & Projects (ES&P) Data Request

  1. An Exam Systems & Projects Data Request for CDE Data form is required for additional CDE data not available through normal channels.

  2. The Exam System & Projects (ES&P) Data Request form can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/exam/tip/cde/jobaids/default.aspx.

CDE Change Request Form

  1. Use the Compliance Data Environment change request form to request changes to CDE.

  2. The CDE change request form can be requested by sending an email to the CDE Helpdesk at *SBSE.TS.CDE.Support@irs.gov

Codes Used in CDE

  1. The following codes are used in CDE:

    • Selection reason code

    • Source code

    • Project code

    • Aging reason code

    • Tracking code

    • Disposal code

    • Accepted as filed reason code

    • Survey reason code

Selection Reason, Source, Project and Aging Reason Codes
  1. A listing of selection reason codes, sources codes, projects codes, and aging reason codes used in CDE can be found in the CDE website "Job Aids" folder at http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx

Tracking codes
  1. Tracking codes can also be input into CDE, but are not required.

Disposal Codes
  1. The following disposal codes are generally used in CDE:

    • Disposal Code 23

    • Disposal Code 24

    • Disposal Code 31

    • Disposal Code 35

Accepted as Filed
  1. Disposal Code 23 - Accepted as filed by classification for returns other than DIF. This disposal code is used only when the return is not on AIMS.

  2. Disposal Code 24 - Accepted as filed by classification for DIF returns. This disposal code is used only when the return is not on AIMS.

Survey
  1. Disposal Code 31 - Survey before assignment by PSP - input by VIA when surveying a case file(s).

  2. Disposal Code 35 - Survey excess inventory - input by VIA when deleting a case file(s).

Erroneous Accesses

  1. All attempts to access IRS returns are recorded by CDE in its SAAS log file. Users should follow the procedures for Form 11377-E, Taxpayer Data Access, to document accesses that are erroneous or may not otherwise have sufficient documentation.

Information Reports

  1. If, while conducting research on CDE, a return is noted that contains potential issues not necessarily relevant to the purpose of the research, but does have indications of significant noncompliance, then information reporting procedures contained in IRM 4.10.5.14, Form 5346, Examination Information Report, should be followed.

Employee Returns

  1. Employee returns and their spouses are included in the CDE database and are subject to the same research processes as other returns. Employee returns must be treated like all other returns identified during research on CDE. Filters should never be rerun for the purpose of eliminating employees from a TIN list.

  2. When an employee's tax return is viewed or printed, this fact will be noted on CDE facsimile. See IRM 4.2.6.3, Examination of Employee Returns, for guidance on employee audits.

  3. An indication whether the tax return is an IRS employee's tax return is included in the sample report.

  4. On the Form 3210, Document Transmittal the comments field is populated if the return belongs to an employee.

  5. Complete Form 11377-E, Taxpayer Data Access, to document.

  6. See IRM 4.2.6.2, Employee Tax Compliance, for additional procedures.

Proper Handling of CDE Facsimiles and Other CDE Documents

  1. The same security should be provided for any document produced by CDE containing taxpayer identifying information as is given actual tax returns and all other confidential taxpayer information. This includes transmittal via Form 3210, Document Transmittal, for any documents containing taxpayer identifying information distributed outside of the PSP area support/campus exam operations.

  2. All electronic CDE documents must be encrypted before being sent. All CDE electronically stored documents must be encrypted.

  3. CDE documents containing taxpayer information such as TIN lists, should be properly disposed of by the recipient following IRS security procedures.

Disclosure of CDE Facsimiles

  1. The same security should be provided for any document produced by CDE containing taxpayer identifying information as is given actual tax returns and all other confidential taxpayer information. This includes transmittal via Form 3210, Document Transmittal, for any documents containing taxpayer identifying information distributed outside of the PSP area support/campus exam operations.

  2. All electronic CDE documents must be encrypted before being sent. All CDE electronically stored documents must be encrypted.

  3. CDE documents containing taxpayer information such as TIN lists, should be properly disposed of by the recipient following IRS security procedures.

Time Reporting

  1. The following activity codes should be used for time spent on CDE activities:

    • Project Coordination, Activity Code 617 (Project Coordination)

    • Classification Management, Activity Code 624 is used when reviewing CDE returns.

    • Return Classification, Activity Code 625 (Classification) to be used when accessing CDE as a classifier.

    • Return Coordination, Activity Code 621 (Classification Returns) to be used by the returns classification coordinator.

  2. See IRM Exhibit 4.9.1-1, Definitions of Miscellaneous Examination Activity Codes (Direct and Non Direct).

CDE Help

  1. CDE has the following options for securing assistance with the CDE application:

    • CDE help desk

    • CDE reference materials

    • CDE virtual tour

CDE Help Desk

  1. For CDE system operation questions/issues contact the CDE help desk via e-mail at *SBSE.TS.CDE.Support@irs.gov.

CDE Reference Materials

  1. CDE examples of reports can be found on the following website: http://mysbse.web.irs.gov/examination/tip/cde/jobaids/default.aspx.

  2. Contact the CDE help desk at *SBSE.TS.CDE.Support@irs.gov for CDE training materials.

  3. The PSP CDE SharePoint provides PSP users a single work space to coordinate schedules, organize documents, and participate in discussions within the organization and over the Intranet. Specific PSP user role handbooks can be found on the following SharePoint site: https://organization.ds.irsnet.gov/sites/SBSEfeEPD/ERS/CDE/SitePages/Home.aspx This is a restricted site and access is approved by the headquarters ECS analyst.

  4. The PSP Electronic Delivery SharePoint provides job aids, training courses, and discussions relating to CDE electronic delivery. It is found on the following SharePoint site: https://organization.ds.irsnet.gov/sites/SBSEfeEPD/CDERGS/Shared%20Documents/Forms/AllItems.aspx

CDE Virtual Tour

  1. The CDE program contains a virtual tour for various roles. A virtual tour is an approach to learning CDE that uses a hands-on process without viewing or accessing live data. All the screens are pictures of actual screens. These screens have hot spots where you can click on the screen, usually an icon, to replicate the CDE program. The CDE virtual tours are accessed through the Help button in CDE.