"Provide America's taxpayers top quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all."

The mission of the W&I Division is to provide W&I customers top-quality service by helping them understand and comply with applicable tax laws and to protect the public interest by applying the tax law with integrity and fairness to all.

The manual is your main source of information in correcting the record on the screen and the related return.

Records will be placed into the Error Inventory of the Workload Suspense Inventory for correction.

Once the Error Resolution Tax Examiner accesses the record and it is displayed on the screen it must either be fully corrected, placed in suspense for additional information, or rejected from pipeline processing. Corrections will include correcting errors in editing or transcribing and correcting math errors.

You will also find procedures in IRM 3.12.38, BMF General Instructions and IRM 3.0.273, General - Administrative Reference Guide, which contains general instructions for correcting records on the screen, document control, electronic payments inventories and management reports.

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

IRS employees are required to give their name and unique identification number during taxpayer telephone, face to face or written contact. In addition, a telephone number is required on all taxpayer correspondence. This will provide taxpayers with enough information to identify an IRS employee who has previously assisted with tax-related matters.

Key Points — All IRS employees, in the field, national and regional office, who communicate, by telephone, correspondence or face to face, with taxpayers or their personal representatives, on tax-related matters are required to provide (at a minimum) the following information:

Some Submission Processing Campus have developed local use Desk Procedures. Such procedures are only to be used:

Unit managers must have a signed approval on file from the responsible Operation Manager on all Submission Processing Campus Desk Procedures.

All existing local information and procedural issuances must be reviewed periodically by the Operation Manager level (at least 2 times a year or with each IRM revision) to ensure conformance with Headquarters procedures (make necessary changes, secure necessary approvals, etc.).

Emergency problems must be telephoned to the Headquarters program analyst if the problem cannot be resolved and is identified as a work stoppage.

Tax returns can be received via fax as part of return perfection even if a taxpayer signature is required. In circumstances where contact with the taxpayer has been made and documented, fax signatures are acceptable.

Contact with the taxpayer may be by telephone or correspondence. Follow local procedures to determine which method of contact will be used.

Code & Edit examiners will indicate the fax paragraph on the Form 3696, Correspondence Action Sheet, to advise taxpayers of the option to fax their response.

A frivolous argument is used for the purpose of expressing dissatisfaction with the substance, form, or administration of the tax laws by attempting to illegally avoid or reduce tax liabilities. Recognized frivolous arguments made by businesses include, but are not limited to, the examples in IRM 4.10.12. See Exhibit 3.12.217-14. for more information.

Review the return to determine whether it appears to be a frivolous return.

Document Perfection is responsible for identifying refunds and for initiating requests for manual refunds.

Expeditious processing of refund returns is critical if the 45-day period is about to expire.

Taxpayer Advocate Service (TAS) Manual Refunds- any return hand walked by a W&I Submission Processing (SP) liaison for Taxpayer Advocate Service must be processed by a Lead Tax Examiner or designated tax examiner using the following procedures in the order listed:

Correspondence: If required for missing or incomplete information, follow procedures below:

Additional Suspense action needed: If the return requires other suspense action, then follow procedures below:

Assigning Taxpayer Notice Codes (TPNCs/Math Error): When a math error is identified, do the following:

When Balance Due/ Overpayment Math Error Code (EC) Generates do the following:

Rejects Suspense Procedures:

Refer taxpayers to the Taxpayer Advocate Service (TAS) when the contact meets TAS criteria, ( IRM 13.1.7, TAS Criteria) and you can't resolve the taxpayer's issue the same day. The definition of "same day" is within 24 hours. "Same day" cases include cases you can completely resolve within 24 hours as well as all cases in which you have taken steps within 24 hours to begin resolving the taxpayer's issue. Do not refer these cases to TAS. Refer to IRM 13.1.7.4, Same Day Resolution by Operations. When referring cases to TAS use Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), and forward to TAS in accordance with your local procedures.

The National Taxpayer Advocate has reached agreements with the Commissioners of the Wage & Investment (W&I) Division, Small Business & Self Employed (SB/SE) Division, Tax Exempt & Government Entities (TE/GE), Criminal Investigation (CI), Appeals and Large and Mid-Size Business (LMSB), that outline the procedures and responsibilities for processing Taxpayer Advocate Service (TAS) casework when either the statutory or delegated authority to complete case transactions rests outside of TAS. These agreements are known as Service Level Agreements (SLAs).

The SLAs are located at http//tas.web.irs.gov under the heading "Policy/Procedures Guidance" .

The purpose of the BMF Consistency initiative is to achieve consistency in the BMF Error Resolution System processing IRMs.

Topics for BMF Consistency have been identified and developed as a coordinated effort between Cincinnati Submission Processing Campus (CSPC), Ogden Submission Processing Campus (OSPC) and Head Quarters Paper Processing Branch BMF Code & Edit/ERS Section.

BMF Consistency tridocs are identified by a "♦" (diamond) before and after the tridoc title.

The text in normal print within a consistency tridoc signifies the common processes to be used for all BMF returns. The text in bold print is form-specific and applies to this IRM only.

When the following forms are referred to in this section, the chart below shows their form number, form title and use.

The Error Resolution System will identify errors according to type and priority.

Any field that does not meet the requirement(s) for that field will be displayed as a Field Error in the order encountered in the record.

This error is caused by a section with variable length input fields containing an erroneous size field. This type of error will show all input fields of the terminus section. Transcribed data will be present. Computer generated fields or Remittance Field for Section 01 will not be present.

Records for the documents in the Error Resolution System (ERS) are controlled by Status Codes. The status is updated when the record is placed in specific inventory.

Below is a list of the status codes and a brief explanation:

The final two positions of the Status Code will consist of the first two positions of the Action Code. This will put similar work together on the Workable Suspense Inventory. For Example —321— Suspense period expired, no response to taxpayer correspondence. If a record has been selected to be held for Quality Review, the second and third position will be "QA" For Example "1QA" , "3QA" or "4QA" .

Records for which the Suspense Period has expired before being activated are automatically moved from Status 2XX to Status 3XX.

Action Codes (AC) are input when information is missing or the record must be suspended from processing.

The presence of a valid Action Code other than 001 will place the record in the Suspense Inventory, either Workable or Unworkable.

If the tax examiner will not be issuing a letter through IDRS, it will be necessary to attach a Correspondence Action Sheet (3696) or other acceptable form to issue the correspondence.

The Action Code indicates that specific information is missing or that the record is to be rejected from processing. The code will indicate if correspondence is to be sent to the taxpayer or the specific in-house research or action required. This chart describes each Action Code, their functional use (EC = Error Correction, DP = Document Perfection, S= Suspense Correction and GEN = generated) and the suspended period.

Beginning with tax returns for periods ending 12–31-2007 and later, Form 2553 may be filed as an attachment to Form 1120S requesting to be considered a S Corporation. Code and Edit area will detach all Forms 2553 received with a Form 1120S and send on to Entity for prompt consideration. For MeF filed Forms 1120S, this will be attached to the return as a Portable Document File (PDF) file and will generate an Action Code 347. Error corrections must then assign the case to Entity Control for prompt consideration.

The letter "C" is used as a "Clear Code" for the Error Codes where the error condition is such that the resolution does not require a change or correction to the record as displayed. The display will include a Clear Field labeled "CL" to indicate the possible need of a Clear Code. CC CRECT is used to enter the "C" .

Code "C" is also used for clearing the Action Code from the screen after corrections for the Action Code have been completed, or as with Action Code 410, the Action Code must be cleared initially, so other errors in the record can be resolved. The presence of the "C" with a Priority I Error indicates that you have made the corrections to the Action Code and now wish to have any other errors on the record displayed.

The "000" is also used as a Clear Code when deleting Action Codes. It will only be used for erroneous Action Codes and you have determined there is no reason to suspend the record. The "000" cannot be used in suspense correction.

Programming erases all "C" Clear Codes for Error Codes when a record is suspended with the CC SSPND.

Programming erases all "C" Clear Codes for Error Codes and Action Codes for the new day’s Error Inventory and Workable Suspense Inventory. Unfinished records from the previous day will contain none of the "C" Clear Codes that were assigned to a record that was not completely worked.

Error codes (including the ones which may require a " C" Clear Code) are numbered consecutively in order for correcting. There may be instances when you as an ERS tax examiner, correcting errors at the terminal, will create an Error Code with a higher priority than the one(s) you have cleared with a Taxpayer Notice Code or "C" Clear Code. Should this occur, programming will erase all "C" Clear Codes and Taxpayer Notice Codes for Error Codes with a lower priority than the one created.

Beginning with the highest priority Error Code created, programming will continue displaying Error codes for the record. Displays using the corrected data are apt to be different from those previously displayed.

There may be instances when you will make a correction erasing an Error Code which you previously cleared with a "C" and now the error condition no longer exists. Should this occur, the "C" Clear Code for this error and all "C" and TPNC for all subsequent errors in the record will be deleted.

If after deleting the "C" and TPNCs and there are errors remaining on the record, they will be displayed for resolution whether or not they were previously displayed.

The "C" Clear Code will prevent any other corrections to the record to accompany the "C" Clear Code. If a correction must be entered but you have already entered the "C" Clear Code, and the error is no longer displayed, create a higher priority error. If the record has cleared, then use CC GTRECW to make any corrections.

When perfection of a return is not possible and it is necessary to correspond, perform in-house research, or refer the document to another area of the Submission Processing Campus, the record will be suspended and the required action taken.

Suspend the unprocessable record by entering the CC SSPND followed by the appropriate Action Code.

Replies—When the taxpayer replies to correspondence, continue to process the return with the instructions provided in IRM 3.0.273, Administrative Reference Guide.

No Replies—When the taxpayer does not respond to correspondence, input CCC "3" (on refund returns only) and use the following procedures as applicable.

For missing schedules use the chart below to determine the Missing Schedule Code, Field 01MSC:

The purpose of the BMF Consistency initiative is to achieve consistency in the BMF Error Resolution System processing IRMs.

Topics for BMF Consistency have been identified and developed as a coordinated effort between Cincinnati, Ogden and Paper Processing Branch BMF Code & Edit/ERS Section.

BMF Consistency subsections are identified by a "♦ " (diamond) before and after the tridoc title.

The text in normal is the common processes for BMF returns. .The text in bold print is form-specific and applies to this IRM only.

Sometimes a return is received with written information on the attachments.

All attachments or photocopies of attachments that are routed to another area must contain the taxpayer's:

The CC NAMEE will be using a system called Name Research Facility (NSF), which is a Taxpayer Identification Number searching tool.

NSF provides a national centralized name search capability which replaces the Key Index File (KIF) located at each Submission Processing Campus. Authorized users will have access to NSF via CC NAMEE for EIN searches.

NSF will provide an input screen to enter data about the taxpayer (name, address, etc.). It will match the data entered, to data we have in our files and will return to the users the Social Security Number (SSN) or EIN of any possible matches. The more information entered, the narrower the search and the better the possibility for a match. The CC NAMEE requires a name be entered for searching the NSF use CC NAMEE to verify that the EIN the taxpayer has furnished is on the Master File. See http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/command-code.dr/idrs_command_codes_job_aid.htm for all CC job aids.

OLE is a Taxpayer Identification Number (TIN) system designed to allow for validation of the EIN and EIN/name control on line with IDRS input CCs. It is also designed to allow for entity research on a national basis.

Use CC INOLE to research the entity module. This information includes name lines, name control, address, employment codes and filing requirements. See http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/command-code.dr/idrs_command_codes_job_aid.htm for all CC job aids.

The display for a BMF EIN account or INOLE will show the:

Validation of IDRS CCs—IDRS CCs that create a transaction for posting to the Master File will have the EIN and EIN/name control validated using the Taxpayer Information File (TIF), and the National Accounts Profile (NAP).

The CCs will not return the "Request Completed" response until the EIN and EIN/name control have been validated by the NAP as being on the Master File that the transaction will attempt to post.

The following IDRS CCs are affected by OLE validation:

If the EIN matches the EIN and name control, normal processing will continue.

If the EIN or name control mismatches, See http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/command-code.dr/idrs_command_codes_job_aid.htm for all CC job aids.

CC BRTVU is used to research edited, transcribed and computer-generated line items for BMF returns and related forms and schedules. This information will be accessed using CC BRTVU with a Taxpayer TIN, a two digit Master File Transaction (MFT) Code, Tax Period and Definer Code.

The Returns Transaction File does not contain all the information available on the IDRS system, for example, IDRS notice status, case control information. BRTVU can be accessed even when TXMOD and SUMRY are not available.

CC BRTVU, with definer SM, requests the summary screen for a specific EIN, MFT and tax period. This screen provides information about income, deductions, tax, remittance, number of pages, and schedules or forms attached to the return.

Definers will only be displayed for the forms that are present with the return. A form is present if any field on the related screen (other than name control) contains significant data.

If the definer is blank or invalid, or a definer is requested for a screen not available for the record requested, the computer will display the summary screen, showing available screen and definers.

Screens may be accessed using the appropriate two positions definer code. The valid definers for Form 1120S are:

Amended and duplicate returns can be accessed via CC BRTVU by inputting a sequence number immediately after the definer code. These returns will display the format of the year processed, therefore, the line numbers may be inconsistent with current year returns.

CC BMFOL provides on-line research capability of nationwide entity and tax data information posted to the Master File.

CC BMFOL displays information very similar to CC MFTRA. In fact CC BMFOL, is a suggested alternative to CC MFTRA.

CC BMFOL, with definer I, displays a summary screen for a specific account. The summary screen will show what other display screens are accessible and a minimum of information on each available module.

For further explanation of the screen displays and applicable definer codes, see http://serp.enterprise.irs.gov/databases/irm-sup.dr/job_aid.dr/command-code.dr/idrs_command_codes_job_aid.htm for all CC job aids..

Form 1120 must be converted to Form 1120S when the taxpayer has filed Form 1120 and the Entity Control Unpostable Unit has determined the taxpayer has a valid Form 2553, Election by a Small Business Corporation, on file.

When the Form 1120 has been converted to a Form 1120S Entity must ensure that only the received date, Field 01NAI and Audit Code 4 is edited to the new renumbered form. If a field other than those mentioned above has been entered, delete it.

For MeF Forms 1120 being reprocessed as Form 1120S, ensure the correct received date is edited on the document. The received date is the Julian DLN date of the original DLN. Do not subtract ten days in the case from the Julian Date.

Do not enter any tax data on the "blank" Form 1120S.

If a request for an installment agreement (an inquiry by the taxpayer that he be allowed to make payments on a debt) is attached to any return, detach it and send it to the Collection Branch. This request may come on Form 9465, Installment Agreement Request. When forwarding the installment request make sure the following information is included as a working trail: EIN, Name, Type of Return, Tax Period, Amount Due and Amount Paid.

Remittance (RMIT>) is an entry that identifies payment made with return.

This entry must be blank or numeric.

If a numeric amount is present, it must be dollars and cents.

It must be blank for non-remittance returns, overpaid returns and remittance returns processed through the RRPS (Residual Remittance Processing System) /ISRP system.

This is a non-correctable entry.

The name control consists of the first four significant characters of the corporation’s name.

The valid characters are alpha, numeric, ampersand (&), hyphen (-), and blank.

The Name Control is invalid if the first position is blank or there are any intervening blanks between significant characters.

Check Digit is present only on a preaddressed return when the EIN has been validated or is generated from DATA using information contained on the Entity Index File.

Check for coding and transcription errors.

If the correct Check Digit cannot be determined, enter the Name Control.

If the Name Control cannot be determined, research using local Submission Processing procedures.

The EIN is located in the box indicated on the return or on the preprinted label.

Check for coding and transcription errors

This field is invalid if:

If transcribed correctly, search the return for another EIN and/or use local Submission Processing Campus research procedures to obtain the EIN. If found, enter in Field 01EIN and send a Letter 3875C. Notate that the letter 3875C should not be sent if it is obvious that EIN numbers have been transposed or has three or fewer digits different.

If another EIN is not found during the search above, or if there is no record of an EIN, or multiple EINs are found, suspend the record with Action Code 320 and route to Entity Control for an EIN to be assigned.

On an RPS return, with an EIN change SSPND with Action Code "351" to route to rejects.

Entity Control has found the correct EIN, enter it in 01EIN.

If Entity Control has assigned an EIN, enter it in 01EIN. Enter the entity assignment date, found in the lower left hand corner of the return, in 01CRD if it is after the return due date.

Rejects will research any RPS return with a change to the EIN to determine if a payment has posted correctly.

Field 01NAI is the North American Industry Classification System (NAICS). The NAICS codes have replaced the Principal Industrial Code (PIA). The NAICS Code is a 6 digit code. It is transcribed from Box B, Page 1, Form 1120S. It may be found on the preprinted label to the right of the Area Office Code.

Invalid Condition—This field is invalid if it is not present (except G Coded returns), or it is other than 000001 through 999000.

Correction Procedures

01TXP is the Tax Period field which is located on the preaddressed label or at the of top of page 1 of the return.

Tax period ending is printed in Year (YYYY), month (MM) format e.g., Dec. 31, 2006 is printed 200612.

The tax period is located above the first name line, to the right on the return.

The tax period must be present and contain six numeric digits.

The last two digits must be 01–12 and the year (first four digits) must not be greater than the current year. In addition, if the year is equal to the current year, the month must be equal to or earlier than the current month.

Determine from preaddressed label or tax year at the top of page 1 of the return the correct Tax Period ending date.

Correct Field 01TXP when a transcription or edit error is discovered.

A taxpayer can file a return for:

The Received Date is entered in YYYYMMDD format and must contain eight numerics. The fifth and sixth digits (month) must be 01–12 and the seventh and eighth digits (days) must be 01–31. This field will show on the return in MMDDYY format. On the ERS Screen it will display as YYYYMMDD.

Check for coding and transcription errors.

The received date is required on all Forms 1120S. If the received date was not stamped/edited, determine the received date using the criteria listed below.

The received date should be determined in the following priority:

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

If the received date stamp is invalid (i.e. 20080115 in lieu of 20090115) then change the received date year to the current year.

The received date must be either equal to the current processing date or prior to the current processing date.

Tax returns received after the Return Due Date (RDD) require a Received Date.

Computer Condition Codes are used to identify a specific condition for the computer.

This field can contain up to 10 positions.

The valid characters are B, D, F, G, I, L, O, P, Q, R, W, X, Y, 1, 3, 7, 8, and 9.

Computer condition codes are edited to the center dotted portion of the Income Area, on page 1 (lines 1–6) of the return.

If an overflow condition occurs in Field 01CCC (more than 10 codes) retain the codes in the following priority–F, D, O, Y, W and others.

Examine the return for transcription errors. Correct any errors found on the return and the screen as appropriate. Refer to the chart of Computer Condition Codes.

If CCC "G" is present with another CCC except "W" and/or "3" , it will cause a field error.

If CCC "G" is correct, delete all other CCC except "W" and/or "3" . Otherwise, delete CCC "G" and enter all tax information as reported on the return.

Use this chart to identify Computer Condition Codes

The Correspondence Received Date (CRD) displays in YYYYMMDD format and must contain eight numerics.

Check for coding and transcription errors.

If more than one CRD is present, use the earliest CRD.

If the reply was not date stamped, use the postmark date on the envelope attached to the reply.

If no reply or the correspondence was undeliverable enter a 3 in Field 01CCC.

If there is an indication that Entity Control has assigned an EIN to the return, enter the entity assignment date found in the lower left-hand corner of the return if it is later than the Received Date and the Return Due Date. If there are both a CRD and an Entity Assignment date, enter the later of the two.

Do not enter Field 01CRD if any of the following conditions are present.

The Paid Preparer Check Box is located next to the taxpayer signature area. This box is used to indicate whether or not the TP has elected to allow the Paid Preparer to answer questions about the TP's return as it is being processed.

This field is transcribed from the bottom of page 1, Form 1120S. Code and Edit will enter a "1" in the margin to the right of the checkbox if the "Yes" box is checked.

Correction Procedures:

Description – The Preparer's SSN is transcribed from the bottom of Page 1, Form 1120S. Data may or may not be present in Field 01PSN.

Valid Condition – This field can be blank or numeric.

Invalid Condition – Field 01PSN is invalid if any of the following conditions are present:

Correction Procedures –