The Form 3949-A, Information Referral, is used to report alleged violations of tax law by individuals and businesses to the IRS. The submission of the form is completely voluntary and confidential. Information provided usually includes specific information about who is being reported, the activity being reported, how the activity became known, when the alleged violation(s) took place, the amount of money involved and any other information that might be helpful in an investigation.

This IRM provides instructions on screening the allegations for factual potential tax violations. IDRS research is used to verify if the submission meets examination standards, based on criteria submitted from the receiving BODs.

Title 26 of the United States Code (USC) 7801 and Code section 6103.

The Director of Submission Processing oversees the successful processing of individual and business tax returns through both electronic and paper means.

The operations manager and the department manager oversee:

The team manager/lead oversees:

Entity tax examiners are to:

Entity clerical are to:

Managers will ensure reviews are performed.

Managers will monitor the reasons for referrals being destroyed and track reasons the referrals were retained for destruction. Refer to Document 12990, Records Control Schedules, (RCS) 23, Item 64 c) Administration (NARA) to avoid inadvertent/unlawful destruction of records.

Managers will monitor mis-routed referrals and record the date, quantity, area and reason the referral was returned.

Managers must ensure internal control responsibilities are carried out. The key duties and responsibilities are monitoring, recording, and preparing inventory reports.

A list of some of the acronyms used in this IRM are included in the table below. This list is not all inclusive. For details on other acronyms, please refer to the Acronyms Database.

The following IRM’s and publications are used in conjunction with this IRM section:

Submit IRM deviations in writing following instructions from IRM 1.11.2.2.3, When Procedures Deviate from the IRM, and elevate through proper channels for executive approval.

Service center directors, headquarter branch chiefs, and Headquarter analysts do not have the authority to approve deviations from IRM procedures. Any request for an exception or deviation to an IRM procedure must be elevated through proper channels for executive approval. This will ensure other functional areas are not adversely affected by the change, and it does not result in disparate treatment of taxpayers.

Examiners are only allowed to access modules on IDRS to carry out their official duties.

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Form 3949-A is used to report potential tax violations but does not have to be included when reporting a tax violation. When Form 3949-A is submitted, the submissions will be worked by tax examiners reviewing Section B 3 “Alleged Violation” and/or keywords/key phrases in Section B 5 on Form 3949-A.

Consider each form on its own merit when multiple Form 3949-A are attached.

Review the submission against IDRS to determine whether the submission contains specific and credible data for a potential federal tax issue.

If analysis disproves the allegation as factual, route to retention.

When a Form 3949-A information referral requires conversion, notate in the top left corner of the document what you are converting the referral to. Include referring BOD in the top right corner. Make sure that all edit marks are made in RED pen only and date stamp in the top left. If the case is received in ECM, use the comment sections to notate the information before routing.

If multiple issues are identified, determine if multiple BODs are involved. If analysis disproves the authenticity on one sort, continue with analysis to authenticate all issues.

If the issues identified concern multiple BODs, identify all BODs and prioritize and route following the “If Then” table below.

Form 3949-A referrals may be received digitally through the Document Upload Tool (DUT) from the taxpayer or uploaded digitally by an IRS employee.

Digitally received referrals follow the same routing process as the paper referral process. However, the following differences exist:

Referrals should be processed in a First-In, First-Out (FIFO) order.

When a Form 3949-A is received written in a language other than English, please follow the guidelines found in IRM 22.31.1.5.1.1, Requesting Translations of Non-Vital Documents. These should be routed weekly. Refer to Request Translation Services .

Each BOD determines the acceptance criteria of the Information Referral. The criteria differs for each sort and must be followed as outlined in the IRM.

Use the initial research steps on all issues.

The tax examiner will use red pens on the paper referral to show:

Using IDRS, confirm the taxpayer or business matches the Form 3949-A. Perform further research to identify and validate the taxpayer, spouse or business. If the TIN is not on Form 3949-A but a TIN is located, write the correct TIN on Form 3949-A. If a TIN identification cannot be made, route it to retention.

Review the BOD criteria to make sure the referral is being routed to the correct location. The following describes the BOD code and defines the organization.

Validate the tax year and/or tolerance if BOD criterion is applicable on Form 3949-A, using IDRS or as instructed in the specific sort.

If verification of the taxpayer, business or allegation cannot be made, no other issues are listed in the information referral, and/or the criteria is not met, route the case to retention. Do not look for possible tax violations that are not relevant to the allegation in the Information Referral.

File maintenance retention files are kept per IRM 3.28.2.1.4, Program Management and Review.. Write ”2” on the Information referral to show the referral is being sent to retention. Select one of the reasons listed below to show why the case is being placed in retention.. If the case is received in ECM, notate the reason in the comments before routing.

Dependent without Earned Income Tax Credit (EITC) criteria only applies to the current processing tax year, or the immediate prior tax year when the year is specified. If the allegation does not list a tax year, consideration should only be made to the current processing tax year. If the tax year listed is not the current processing tax year, or the immediately prior tax year (when specifically addressed in the referral), review the allegation to determine if other BOD criteria exists.

Follow the “If Then” Table:

When the allegation consists of Non-Filing for an Individual Tax Return, review the tax module to determine if the alleged has filed ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ (regardless of the tax year referenced in the referral).
Note:When CC IMFOL with definer “I” Posted Return Value is SUBST4 or TC 150 posted for a particular year, consider that year as a filed year.
Note:Research CC IMFOL with definer “T” for non-filed years. If there is a TC 594, consider that year as a filed year.

If the alleged has not filed a return for tax years #2019-2022#, continue to the “If And Then” table below.

When the year is specified, Dependents with Earned Income Tax Credit (EITC) criteria only applies to the current processing tax year or the immediate prior year. If the allegation does not list a tax year, consideration should only be made to the current processing tax year. If the tax year listed is not the current processing tax year or the immediate prior tax year (when specifically addressed in the referral), review the allegation to determine if other BOD criteria exists.

Conduct an initial review for the selected referrals.

Research IDRS using command code (CC) IMFOL with definer “T” to verify that the tax year has a posted, unreversed, TC 764 and/or TC 768, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.

If there is a posted, unreversed, TC 764 and/or TC 768, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ continue processing as TS Campus Exam criteria.

For referrals that do not meet TS criteria, refer to IRM 3.28.2.5.1, Dependent without Earned Income Tax Credit (EITC) for Current Processing Tax Year and the Prior Tax Year, to determine if the allegation meets SB/SE Campus Exam criteria.
Referrals should be routed directly to the BOD by following the guidance in the Screening Criteria in the “If Then” table below.

If the allegation of unreported income on Form 3949-A is verified through IDRS research for the following conditions below, accept the sort as CI Financial Crimes:.

Use the following “If And Then” table to determine the correct sort.

If the allegation relates to failure to file W-2s, research filings on CC PMFOL with definer “S”. If the “W-2” row reflects a number other than “00” in the “Documents” column, the allegation is invalid. Route to retention.

If the allegation relates to failure to file Forms 1099, use CC PMFOL with definer “S”. If either the “MISC” or “NEC” rows reflect a number other than “00” in the “Documents” column, the allegation is invalid. Route to retention.

If the allegation is not routed to retention based on the criteria above, continue to the “If And Then” table below.

Estate tax referrals

Gift tax referrals

If the allegation is not routed to retention based on the criteria above, continue to the “If And Then” table below.

Excise taxes are taxes paid on the manufacture, sale or use of certain supplies or services. To identify if the issue is an excise tax issue, All the following conditions must be met:

If the allegation is not routed to retention based on the criteria above, continue to the “If Then” table below.

Referrals mentioning offshore, overseas or a foreign country or a U.S. Citizen living abroad are Withholding Exchange International Individual Compliance (WEIIC) issues. Remove the referral from the sort to route. For proper routing refer to IRM 3.28.2.14, Quick Reference Entity Clerical Routing Guide.

Large business acceptance criteria for Information Referrals:

Locate the EIN on the referral. If the EIN is not present, research IDRS using CC NAMEE to find the business.

Determine the filing requirements using CC INOLES. If the filing requirements are only for Employment Taxes, Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return, and/or for Form 94X, Employer’s Quarterly Federal Tax Return, research the cross reference TINs to locate the parent EIN or to determine if the business files a Schedule C.

If the allegation is not routed to retention based on the criteria above, continue to the “If Then” table below.