Employees in the Accounts Management (AM) organization respond to taxpayer inquiries by telephone in our customer service centers, in addition to processing amended returns, claims, duplicate filed returns, loose forms, correspondence, etc., and address all other internal adjustment requests.

The authority for this IRM include:

The Chief, Taxpayer Services oversees all policies related to this IRM which is published on an annual basis.

The Accounts Management Director oversees the instructions in this IRM.

Accounts Management Policy and Procedures IMF (PPI) Tax Analyst(s) oversees the content in this IRM and acts as a point of contact for all Accounts Management sites.

Managers and leads ensure compliance with the guidance and procedures in this IRM for Adjustment Guidelines.

Employees input adjustments following procedures in this IRM.

Program Reports: The program reports provided in this IRM are for identification purposes for the Accounts Management Contact Representatives (CRs) and Tax Examiners (TEs). For reports concerning quality, inventory aged listing, refer to IRM 1.4.16, Accounts Management Guide for Managers. Aged listings can also be viewed by accessing Control Data Analysis, Project PCD, are on the Control-D / Web Access server, which has a login program control.

Program Effectiveness: Program Effectiveness is measured and controlled through:

Program Controls: Goals, measures, and operating guidelines are listed in the yearly Program Letter. Quality data and guidelines for measurement are referenced in IRM 21.10.1, Embedded Quality (EQ) Program for Accounts Management, Campus Compliance, Field Assistance, Tax / Exempt / Government Entities, Return Integrity and Compliance Services (RICS) and Electronic Products and Services Support.

See the table below for a list of acronyms commonly used in this IRM. For a comprehensive listing of any IRS acronyms, refer to the Acronym Database.

Related resources for this IRM include (list is not all inclusive):

When working any AM case type, it is essential to complete all account research prior to taking any account actions, transferring a call, or reassigning a case to IDTVA. The initial employee is responsible for identifying the taxpayer issue, researching the account including AMS to eliminate any routine account issues prior to making the determination to reassign the case to IDTVA for potential identity theft (IDT).

If any of the following exist on the account or within your case, then actions can be taken to refer to IDTVA.

If a multiple control is present with specialized inventory outside your scope (e.g., IDT1, IDT3, IDT8) and:

If the criteria above are not met, continue with complete research to determine whether there is any other treatment stream before identity theft is considered. Complete research is essential to determine the necessary corrective actions and to prevent delays in resolution. The following information contains research tips and reminders to take into consideration as you research your case. The IRM sections cited below are not all inclusive. Reference other IRM sections as applicable.

For purposes of identifying the correct account issue, refer to the following definitions and the applicable IRM sections. If any of the below apply, the taxpayer is not a victim of identity theft. Follow the applicable procedures.

Search returns, schedules, and forms for a different TIN, if applicable. Research spouse and dependent information, whenever available.

Research the TIN (valid and invalid) to determine if there is a mixed entity (MXEN), or scrambled SSN case (SCRM/SSA2) in prior and/or subsequent years. Attempt to locate any possible cross-reference TIN. You may identify a cross-reference TIN assigned to a taxpayer who filed a return under the Common Number (CN) that was determined to be to identity theft. Internal Revenue Service Numbers (IRSNs) are temporary numbers issued by the IRS and are always on the invalid segment of Master File. The invalid segment is indicated by an asterisk (*) following the last digit of the TIN. Additionally, the tax return(s) in question is reviewed to determine if the case is a mixed period instead of a TIN-related issue.

Research the valid and invalid sides of any TINs identified for the case (i.e., primary, secondary, different TIN located on forms, etc.). A return posted to the invalid side of the CN is not sufficient evidence to identify an IDT issue. Conduct further research to verify the return was not processed to the invalid side of the TIN as a result of an error on the return or name changes that have not yet been provided to the IRS by the Social Security Administration (SSA):

If additional research is required to locate a TIN for the taxpayer, use CC NAMES or CC NAMEI to input the taxpayer’s name and address information to search for a TIN. To do a broad search, input the taxpayer’s name and only the first 3 digits of their zip code. The results will include taxpayer information from areas surrounding the current address. Consider the following possibilities when conducting research using CC NAMES or CC NAMEI:

Refund inquiry – The non receipt of a refund does not automatically warrant an ID theft referral. Refer to the applicable procedures in IRM 21.4, Refund Inquiries.

Review the account for freeze code conditions and refer to IRM 21.5.6, Freeze Codes, as applicable.

The presence of TPP indicators do not automatically mean the taxpayer is a victim of identity theft. A return is selected by TPP if questionable and requires authentication. Review the account, including AMS, to determine whether the TPP issue has been resolved.

You may identify suspected IDT when the return does not master file verify and when certain account changes seem suspicious such as large, unusual or questionable line-item changes. When this occurs use the following research steps to aid in determining if the return should be routed as IDT:

After you have exhausted all account research and performed any applicable procedures per the IRM for the initial case type, if it is determined there are no other treatment streams applicable, and you determined account discrepancies indicating possible identity theft, refer case to IDTVA for possible identity theft.

Various Administrative Waivers and Statutory Exceptions assist in processing adjustment requests timely and efficiently. For additional information that are specific to penalties, refer to IRM 20.1.1.3.3, Statutory Exceptions and Administrative Waivers.

We receive requests for adjustments to tax, penalty, interest, and other issues, in two main forms:

Authorities and Waivers are sometimes granted:

IRM 21.1.3.20, Oral Statement Authority, outlines the oral statement authorities for Accounts Management. This IRM contains the procedures that Accounts Management must apply to any questions concerning oral statements.

If an address change is necessary and the taxpayer requests the address change using an oral statement, the address change may be input into IDRS based on Rev. Proc. 2010-16, Rev. Proc. 2010-19, IRB 664. Refer to IRM 3.13.5.29, Oral Statement / Telephone Contact Address Change Requirements, (IMF) and IRM 3.13.2.4.6, Change of Address, (BMF) for additional information.

An oral statement adjustment made prior to the due date of a return does not constitute superseding information or a superseding return as outlined in IRM 21.6.7.4.10, Superseding Returns.

Generally adjusting an item not shown on the original return requires a signed amended return. Inform the taxpayer and order the required tax forms, if needed. See IRM 21.3.6, Forms and Information Requests.

An amended return is not necessary:

The following actions require a written request:

Use the taxpayer’s written request as a source document. Refer to the following IRMs for additional information:

When you speak to the taxpayer and realize the taxpayer's request requires written documentation / substantiation, you must determine if the documentation can be faxed while you are on the telephone with the taxpayer (e.g., penalty abatement based on reasonable cause over the oral statement allowable amount), follow the table below:

For information on Form 941-X, Adjusted Employer’s QUARTERLY Federal Tax Return or Claim for Refund (including the Form 941-X(PR)), refer to IRM 21.7.2.4.5.5, Form 941 Discrepancy — Taxpayer Files Form 941-X.
 

The DLN for IMF and BMF accounts is distinct and contains information useful for processing cases.

The DLN is the 14-digit number assigned to every return or document processed through the Automated Data Processing (ADP) system. DLNs are printed on computer documents in XXXXX-XXX-XXXXX-X format. Refer to DLN Composition in Document 6209, IRS Processing Codes and Information, for detailed information.

Source documents (SD) are required for some adjustments completed with an oral statement:

Verify disclosure requirements before giving account information. Refer to IRM 21.1.3.2.3, Required Taxpayer Authentication, as applicable. Also, see IRM 21.1.3.2.4, Additional Taxpayer Authentication, and IRM 21.3.7, Processing Third Party Authorizations onto the Centralized Authorization File (CAF).

Request taxpayers send documentation required for adjustments listed in (1) above. The taxpayers may fax the information. Provide the taxpayers with your fax number, including area code. See IRM 21.5.2.4.3, Adjustments Requiring an Amended Return or Taxpayer Documentation, and also refer to IRM 21.3.5, Taxpayer Inquiry Referrals Form 4442, for additional instructions.

Specific elements in the "Remarks" field are required for each type of IDRS input (entity, tax, penalty change, or credit transfer, etc.). Oral statement authority adjustments have different requirements. See IRM 21.1.3.20.2, Oral Statement Documentation Requirements, when inputting the remarks for an oral statement account change.

If the input is not completed with an oral statement, input the adjustment with "SD" , "NSD" , or "SDR" in the remarks field (or Y, N, or R on the Command Code (CC) ADJ54 screen).

When completing both an adjustment and a credit transfer, input the required items on the adjustment and reference them in the "remarks" section of the credit transfer.

Briefly explain the reason the adjustment was made, such as "credit transfer" . Also, indicate per letter or other justification:

If there is a conflict between oral statement adjustments procedures in this IRM compared to specific IRMs, work the case according to specific IRMs.

Notices are suppressed in various ways depending on the type of notice and the issue. Notices are suppressed with:

The input screens for some IDRS Command Codes have a field which is overlaid to indicate if a notice should or should not be issued. Notice Suppression instructions are given as needed throughout IRM 21, Customer Account Services.

When CC STAUP cannot be used because actions will result in a settled module, and offset is likely (January - May for IMF, about 8 weeks after due dates for BMF), input a TC 470 without a closing code.

When a CC STAUP or a TC 470 is used to suppress a balance due notice, input a history item on the Account Management Services (AMS) to document the reason for the action (e.g., Taxpayer to file Form 1040-X or Taxpayer to send check).

See IRM 20.1, Penalty Handbook, for more information. Always advise the taxpayer if there is a possibility of a penalty assessment. Explain why a penalty was asserted or assessed. See IRM 20.1.1.4, Methods of Appealing Penalties, for penalty appeal procedures.

To explain how a penalty was computed, use IDRS Command Code (CC) INTST or CC PINEX for Failure to Pay (FTP) and Failure to File (FTF) and CC FTDPN, for Failure to Deposit (FTD). IDRS CCs PIFTF, PIFTD, and PIEST can be used to research penalty assessments.

IRC 6656(e)(1), and Rev. Proc. 2001-58 provide an order for applying deposits that can provide relief from so-called cascading penalties in some situations. IRC 6656(e)(2) allows the person making such deposits to designate a different application within a limited time period. Rev. Proc. 2001-58 provides guidance on such applications. See IRM 20.1.4.26.3, Statutory Penalty Relief.

IRM 20.2, Interest, provides detailed interest instructions. Interest is mandatory unless there is a legal exception. Read and become familiar with the IRM 20.2, and use this IRM following the general interest procedures when answering telephone calls and related interest questions.

IDRS Command Code (CC) PICRD can be used to explain credit interest to the taxpayer. CC PICRD provides a computation display of any computer-generated interest (TC 776) allowed on the refund.

Penalty and Interest Explanation can be provided through IDRS CC PINEX. A PINEX explains how credit and debit interest was computed on an IMF account.

Copies of all supporting documentation for each case with an assessment over ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ where the taxpayer did not full pay in advance is sent to:

Refunds of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ dollars or more do not systemically generate (TC 846). Prepare a manual refund with a Form 3753, Manual Refund Posting Voucher. Procedures are included in IRM 21.4.4.5.2, Preparation of the Form 3753, Manual Refund Posting Voucher. If the taxpayer included a Form 8302, Electronic Deposit of Tax Refund of $1 Million or More, refer to IRM 3.17.79.3.10.1, Form 8302, Electronic Deposit of Tax Refund of $1 Million or More.

The Form 8485, Assessment Adjustment Case Record, is the worksheet used by employees to record actions taken on taxpayer accounts. The case may be from taxpayer inquiries or in-house transcripts. Employees may use other forms, notices, or transcripts to record information as noted in specific procedures.

Prepare Form 8485 - Required entries include Fields 1 through 4,17, and 18 and the following unnumbered boxes at the top of the form:

All other fields are used as applicable:

Modules removed from the MF to Retention Register can be re-established by inputting Command Code (CC) IMFOLB for IMF or CC BMFOLB for BMF. For additional information, see IRM 21.2.2.5, Retention Register Research, and IRM 3.17.21.7, Reestablishment of Retention Register Accounts.

Freezes "G" and "I" are set on the module when it is restored from the Retention Register. This restricts the MF from computing Failure to Pay (FTP) penalty and Interest.

Assess the penalty and interest when appropriate.

Use caution when inputting hold codes (HC). Some rules to remember are:

The HC field on the Command Code ADJ54 screen is a required entry. If the adjustment does not otherwise require a HC, input a HC "0" . For additional information, see Hold Codes, in Document 6209, Master File Codes.

Use Priority Codes (PC) to post adjustments (Doc Code 47 or 54) to the MF when certain account conditions exist. For additional information, refer to Priority Codes, in Document 6209, Master File Codes.

A Posting Delay Code (PDC) range of one (1) to six (6) will make some transactions post later than others when multiple transactions are required to adjust an account. See IRM 21.5.8, Credit Transfers, for the instructions from 1 to 6 cycles, when inputting credit transfers.

PDCs are applicable for IMF, BMF, and IRAF transactions in the following IDRS programs:

The PDC is not posted with the transaction or shown with the IDRS pending transaction. The pending (PN) MF posting cycle on the IDRS status transaction is extended to account for the PDCs.

Use specific functional chapters for instructions on when and how to input numbers for specific types of adjustments. For a detailed listing, refer to Item Adjustment Codes and Credit Reference Numbers, in Document 6209, IRS Processing Codes and Information.

Address all issues before closing the case. For telephone contacts, if collection issues are involved, follow instructions in IRM 5.19.1, Balance Due, to collect any balance due, or see IRM 5.19.2, Individual Master File (IMF) Return Delinquency, to secure missing returns. For correspondence, if collection issues are involved, follow procedures in IRM 21.3.3, Incoming and Outgoing Correspondence / Letters. Check all correspondence from the taxpayer, verifying that all necessary adjustments have been made and the taxpayer’s issue is settled.

Do not request the original return(s) if sufficient information is available to verify the request for adjustment.

Take any of the following actions as necessary:

Do not refer a case to another campus or call site, unless an IRM specifically instructs you to do so. Generally, the call site receiving the contact works the case.

Close your control base when the case is resolved.

The taxpayer is issued an adjustment notice when IRS takes action on the taxpayer’s account. The notice (CP 21A, Data Processing Adjustment Notice, or CP 22A, Data Processing Adjustment Notice) is sent with an explanation of the action.

See IRM 21.6.7.4.1, Source and Reason Codes – CP 21A / CP 22A Notices, for additional details. Document 6209, IRS Processing Codes and Information, provides the specific language generated by the Source Codes and Reason Codes.

Enter a source code (SC) and at least one reason code (RC) on Command Code (CC) ADJ54 when inputting:

If the Correspondence Imaging Inventory (CII) Indicator is present on the lower left-hand side of the ADJ54 screen, there is a case open on CII. Before taking any action, check with the employee or unit with the open control.

Blocking series are used to indicate the nature of an adjustment. Refer to Adjustment Blocking Series, in Document 6209, IRS Processing Codes and Information, for a list of the blocking series used on account adjustments.

The procedures in this subsection are for reprocessing documents after the return posted to an incorrect account or tax period. Carefully read and follow all pertinent procedures in this process before obtaining the original return for reprocessing to the correct tax account(s) or tax period. This may include recapturing an erroneous refund. Refer to IRM 21.4.5, Erroneous Refunds. The return(s) may be for current or prior years and may involve statutes or be subject to a penalty assessment. Follow the procedures in IRM 21.5.2.4.23.11, Reprocessing "Dummy" Returns, to determine if the return can be reprocessed using IDRS Command Codes, prior to attempting to secure a copy of the return for reprocessing.

If you identify an IMF return that must be reprocessed while staffing the AM toll-free telephone lines, first address any other actions needed and then prepare Form 4442/e-4442, Inquiry Referral,. You must also advise the taxpayer that they will receive a contact within 30 days. Forward the completed Form 4442 or e-4442 to the campus AM paper function within your directorate (unless IRM specific procedures apply). If your campus AM paper function no longer has Submission Processing, forward the Form 4442 or e-4442 as indicated below:

Any returns involving taxes or payments of $1 billion or more requires special processing and are forwarded to the Philadelphia Campus, Attention TPR 503 - Drop Point - 3-L08.154. For additional information, refer to IRM 21.7.12.6.2, Procedures for Individual Taxpayer NMF Accounts Of $1 Billion or More - Overview.

When a return unposts or posts to an incorrect account, it must be reprocessed to the correct account. If a refund was incorrectly issued from the account, refer to IRM 21.5.2.4.23.10, Moving Refunds, and IRM 21.4.5, Erroneous Refunds.

Correct the items listed below to avoid the UNPROCESSABLE CONDITIONS identified during original processing. If the unprocessable condition remains, the return is sent back to the employee that corrected it for reprocessing. Therefore, check each item below prior to releasing the return to Submission Processing.

When editing the return is complete, forward to the Batching function for reprocessing as an original return. If the return fails to post, it is returned to the employee that submitted the document for reprocessing.

Control each return or block of reprocessable documents re-entered through the Batching function, using one Form 3893, Re-Entry Document Control, for IMF cases or a Form 13596, Reprocessing Returns, for BMF. Complete these forms and place them on the top of the documents being reprocessed. See Exhibit 21.5.2-1, Preparing Form 3893, Re-Entry Document Control, and Exhibit 21.5.2-2, Preparing Form 13596 – Reprocessing Returns, for complete instructions on preparing these forms.

When reprocessing previously input documents:

BMF only – Consider FTD penalties carefully before the following returns are reprocessed:

Return to the taxpayer any original documents (e.g., birth certificates, death certificates, driver’s license, Social Security cards, cancelled checks, etc.,) upon resolution of the issue, unless the taxpayer indicates returning the document is unnecessary.

Forward source documents (in separate folders labeled by type) to campus files within five (5) workdays of input.

Mail / route source documents immediately after Quality Review is complete. If the source document will be retained beyond seven (7) workdays for completion of certain ADJ54 transaction cases, input "R" in the remarks field of the input screen. Notify the Files Management Unit immediately of any anticipated shipment delays.

Route all adjustment documents to Files Management Unit marked Attn: Files Management Unit. Complete Form 4442/e-4442, Inquiry Referral, e-4442, or Form 8485, Assessment Adjustment Case Record. Include the IDRS sequence number in the top right corner before placing the documents in the employee folder.

Prepare separate adjustment folders for each date and type of input. Label the outside of each folder as follows:

Prepare a separate folder for ADJ54 case actions. Date and sequentially number (legibly and readily available for campus files to recognize) the Form 8485 or other worksheets used to notate the case and account actions taken. This helps campus files maintain the integrity of the cases. Place other transactions (e.g., credit transfers) in a separate "Other Documents" folder and ship daily.

Remember to insert your source documents into your folder as soon as you complete the IDRS account adjustment. If you forget to insert a document into the folder, do not destroy the document. Obtain the DLN and send to campus files to be associated with your case file. If the source document is not included in your folder, the Files Management Unit may contact you requesting the document.

Individuals use Schedule LEP, Request for Change in Language Preference, to elect to receive certain types of written correspondence from the IRS in another language. Refer to IRM 22.30.1.8.15.4.1, Executive Order 13166, Improving Access to Services for Persons with Limited English Proficiency (LEP) and Return Preparation Service, for background information on Schedule LEP. Taxpayers can request this preference change :

Individuals use Form 9000, Alternative Media Preference, to elect to receive certain types of written correspondence from the IRS in an accessible format, such as large print, braille or audio. Taxpayers can request this preference change: