In addition, a TC 898 or TC 971 AC 598 may not be present when the indicator is set to "1" . The Form 8379, Injured Spouse Allocation, is an allocation of the taxpayers joint income, payments, deductions, exemptions, and credits used to determine each spouses share of the joint overpayment subject to offset for any eligible individual or joint, Federal tax debt or TOP debts. Inform the taxpayer that a note has been added to their case and they should allow 30 days to process. Review procedures in IRM 11.3.1, Introduction to Disclosure, for official disclosure information. The election to have the refund issued in one name only is only a procedure for issuing the injured spouses refund, if that is what the taxpayers chose on their Form 8379. No other payments or credits are made to the 2011 MFJ account. You will need to do a manual reversal request. Do not input the TOP offset reversal. Contact Insolvency at the Centralized Insolvency Operation (CIO) or fax Form 4442, (see (1) above for faxing instructions) to determine if the Injured Spouse's refund can be issued. If the offset is more than 6 years old, contact the TOP Liaison for manual reversal procedures. For example: If Bureau of the Fiscal Service receives a payment on 09/10/2013 with a payment date of 09/13/2013 the notice will go out before or by the payment date for both paper check and direct deposit. If an unpostable condition exists, the unpostable condition must be resolved. Bypass TOP offset for primary Taxpayer Identification Number (TIN) debts. An Injured Spouse allocated and received the entire First-Time Home Buyer Credit in a previous year is liable for repayment of the recapture tax. It generates on all CC RFUND manual refunds issued from modules with the combat zone C Freeze in effect. No other payments or credits are made to the 2011 MFJ account. Use a secondary transaction code on the credit side of CC ADD24 or CC ADD34 (e.g. Advise the taxpayer NOT to include a copy of the tax return with the Form 8379 nor to file it with a Form 1040-X unless changes to the tax return need to be made. When the taxpayer provides the dollar amount and documentation of his/her hardship the OBR is issued for that amount. Letter 285C, Refund/Overpayment Applied to Account, see IRM 21.4.6.5.10.5, Injured Spouse RefundTax Offset, for the information to include in the letter. Eligible for TOP offset for child support only. Thus, the injured spouses portion of the joint return overpayment, calculated as a percentage, is .44210 ($4,200 $9,500). Program Effectiveness: Program Effectiveness is determined by AM employees successfully using IRM guidance to perform necessary account actions. If the Form 8379 cannot be allowed, send the taxpayer a Letter 916C with the explanation for the no consideration. If there are any IRS debts which must be by-passed or the address on ENMOD is different than the address on the Form 8379, issue a manual refund for the injured spouses portion of the overpayment. Input a TC 767 with the OTN for the disallowed amount. No other action is needed on the account. A bankruptcy V or W Freeze, set by the posting of TC 520, with closing code 60-67, 81 or 83- 89 with a transaction date prior to 10/17/2005, generates a BPI (3) on a TC 846 issued from that module. Upon the receipt of the listing, IRS Headquarters must review and reconcile the listing with other TOP reports for accuracy prior to sending the listing for resolution. The Department of the Treasury (Treasury), Bureau of the Fiscal Service (BFS), amended its regulation governing the offset of tax refund payments to collect past-due child support obligations. Compare the Injured Spouse's refund allocation with the TC 898 on the module and reverse only the net amount needed for the injured spouse's refund. The FROM date will be 04/15/20XX (or availability date) and the TO date will be the posted TC 776 credit interest to date DB-CR-INT-TO-DT> found on TXMOD, which will result in the amount of offset credit interest the injured spouse is entitled to. You may see a TC 971 AC 598 posted for audit trail purposes only. They may request that you reverse TOP offset and issue a refund with BPI 3. Emergency hardship refunds require coordination with Bureau of the Fiscal Service to ensure that a TOP debt is not bypassed. Determine a new, separate EITC that would be available for each spouse if that spouse had filed a separate return and if EITC were available on a MFS return. See IRM 21.4.6.4.2.9, TC 766 with OTN TOP Offset Reversal, and IRM 21.4.6.5.12.1, Input of TOP Offset Reversals Reference Number (RN) 766 with OTN, for more information. .For both federal tax debts and TOP debts, if the IRS receives the Form 8379 from the non-debtor spouse and it wasnt filed within the applicable IRC 6511 period for the claim for refund, send a 916C letter and advise the taxpayer that the IRS cannot process the allocation because Form 8379 was not submitted timely. Forward the case to the appropriate AM campus that worked the Form 8379. This change limits the time in which Treasury may reverse a tax refund offset to collect a delinquent child support debt to six months. If the case does not meet TAS criteria and the taxpayer has a hardship, transfer the caller to App 35 using ACD = 92035 or IUP = 1035. Contact the TOP Liaison at , for a manual reversal. If separate returns were originally filed and each person claimed part of the credit, each person should recapture 6 2/3 percent on their separate returns. UPC 342, RC 06, occurs when a TC 766 with OTN is greater than the net TOP offset amount. Be sure to use the correct OTN for each adjustment. TC 570) to hold the overpayment when it is necessary to input a credit transfer on IDRS. IRS sent Letter 916C Claim Incomplete for Processing; No Consideration. On manual refunds resulting from a TOP offset reversal, the "FROM" date is based on the refund that was offset. For reports concerning quality, inventory, and auto aged listing (AAL), please refer to IRM 1.4.16, Accounts Management Guide for Managers. Also see The Source for Telephone Numbers on SERP for the hours of operation. Form 8379 is forwarded to the Accounts Management (AM) Function, A (TC) 971, Action Code (AC) 071, is input when the case is controlled. Any amount of the overpayment credit that will offset to another tax obligation, attributable either individually or jointly to the injured spouse, must be subtracted from the injured spouse's share of the joint overpayment. Use HC 3, RC 087, and PC 8 when applicable and use the appropriate post delay code. The injured spouses manual refund must include the appropriate BPI and be issued in either one name only or both names, depending upon how the Form 8379 was completed by the taxpayers. Request the taxpayer provide a signed copy of the Form 8379. If the taxpayer replies with the missing information, update the Return Processable Date (RPD), per IRM 21.5.6.4.17(2), I- Freeze, to the date the information is received. When the CP 36D, Injured Spouse Claims Notice, is received in the AM Function, use Command Code (CC) RTVUE, (CC) TRDBV or Return Request Display (RRD) to view the return on-line and work the Form 8379. The TC 846 will generate the appropriate bypass indicator based upon the previously unreleased RN 808/809/810/811 that is posted. Before reversing any offset to Office of Child Support Enforcement (Agency Codes 1 and/or 2), see IRM 21.4.6.4.2.4, Child Support TOP Offsets. The TC 76X will always be a negative number or zero. Manual refunds will be input using the normal manual refund credit interest rules. 3) Taxpayer claims his/her refund was less than expected, amount agrees with TC 846/840. Review the return and determine if the taxpayer can get relief as an "Injured Spouse" and refer them to Form 8379, Instructions. Update the activity in the control base on IDRS to PENDMRR and monitor the account for the TC 700 which may take up to 180 days to post to the account. 1-3 weeks. Individual Income Tax Return: Request via telephone or letter that the taxpayer send a signed copy of the form via fax or mail and provide any other missing information. TC 150 is blocked 92, the Form 8379 allocation has been worked and a tax or TOP offset has NOT occurred. Bureau of the Fiscal Service, which administers the Treasury Offset Program, controls the offset of debts under IRC 6402(c)-(f). The QBID will be allocated as a percentage of each spouse's Qualified Business Income if the Qualified Business Income (QBI) can be determined. The manual refund document must be received by Accounting no later than the Friday cut-off-time before the Assessment Document Date (23C Date, always a Monday) of the original return. If CC INOLET does not display a debt indicator, then the IAT Results IS screen displays the "N" . A refund offset is when an IRS refund is reduced or intercepted to pay off delinquent debt, such as past-due child support, outstanding student loans, or unpaid state income tax. Refer taxpayer to TOP Call Center above for offset verification. If there is no tax and the taxpayer did not allocate the payments, the form is incomplete. The following conditions do not require a manual refund: If both taxpayers owe a married filing joint debt and it is the only Federal tax debt owed, input RN 808/RN 809 or RN 810/RN 811 for the difference of the Injured Spouse's portion of the overpayment and joint liability. Before reversing any offset to Office of Child Support Enforcement (Agency Codes 1 and/or 2), see IRM 21.4.6.4.2.4, Child Support TOP Offsets. Contact the TOP Liaison at , if needed. A refund offset to an outstanding IMF, BMF, or NMF tax debt is referred to as a tax offset. You can check the status of your 2022 income tax refund 24 hours after e-filing. The AM Function may receive copies of legal documents regarding support obligations. (Example: NCP SC1 PTC 50/50). Under IRC 6402 (a), the Service has discretion whether to offset an overpayment against a liability, but only when it is with respect to an internal revenue tax. Injured Spouse no consideration issues Letter 916C, Claim Incomplete for Processing; No Consideration. Notate NCP SC3. If the current date is more than 30 days past the 23C date and review of the case indicates a clerical error did not occur, the employee should inform the customer that the overpayment has been applied to the balance due account and the IRS cannot undo it. If you work at a remote call site and you don't have access to CIS to view the Form 8379 Allocation Worksheet or do not work injured spouse allocations, transfer the call to Application 35 using ACD = 92035 or IUP = 1035 DO NOT transfer the call if the taxpayer is simply asking about the status of their claim. Advise the taxpayer accordingly based upon the account actions taken to resolve the Injured Spouse Allocation. See IRM 21.6.4.4.20.3, Shared Responsibility Payment Overview, for more information. If you do not agree, you must submit a new Form 8379 allocating the credit as you determine. A review of their account shows a prior year tax liability of $500. Refer taxpayer to TOP Call Center at 8003043107, TDD 800-877-8339. If the refund will be computer generated, input the adjustment with a 290 .00, RN 808/RN 810 or RN 809/RN 811. Additional information is found in IRM 1.1.13.7.3 Accounts Management and IRM 21.1.1, Accounts Management and Compliance Services Overview. Review the account to determine if the account was corrected during the recovery process. . This includes EITC. 19) Taxpayer filed Form 8379 in any manner. Some taxpayers will attach Form 8379 to their joint Form 1040 or Form 1040X, see IRM 21.4.6.5.8.10.1, Form 8379 Attached to Joint Form 1040/Form 1040X. Evidence of the credit condition and documentation must be provided when an OBR manual refund is submitted to the Accounting Branch. For TOP offsets, UPC 189, RC 06, occurs when a TC 766 with OTN is greater than the net TOP offset amount. See IRM 21.4.6.5.23, TOP Unpostable Conditions. Follow these steps for tracking your 2021 federal income tax refund: Gather the following information and have it handy: Social security number (SSN) or Individual Taxpayer Identification Number (ITIN) Your filing status. For same-sex couples residing in a non-community property state, process the Form 8379 the same as opposite-sex couples. A Type 3 is also used to correct an account due to a BFS or IRS processing error. See IRM 21.6.7.4.1, Source and Reason Codes CP 21/CP 22A Notices, for conditions when a notice will/will not generate. Paper file with direct deposit. TC 899, type 4, with positive money amount, is used by the agencies participating in TOP to correct a previously reported refund of a TOP offset. Refer taxpayer to agency on the due process offset notice, or if unknown, to TOP Call Center above (agency must determine who owes debt and issue any subsequent refund). If the Form 8379 is for another year, update the CIS case to the correct year and input the TC 971, AC 071 on the appropriate year. ", RC 089 - "the offset was done in violation of the automatic stay of bankruptcy. Change the control base for paper and electronic filed form to category and program code DMFT (40110 Tax Debt). Input TC 807 first with HC 1, then input TC 808/809/810/811 with a PDC for 1 cycle. 5) Taxpayer claims his/her refund was less than expected, amount disagrees with TC 846/840. Calculate the credit based on Community Property Laws for that state. See SERP, Who/Where, Offer-in-Compromise (OIC) Compliance Campus Locations, for more information. Compute each spouse's separate EITC, with (Y) indicator, based on each individuals earned income, using the same number of qualifying dependents used to compute the EITC on the joint return. The transaction date is the received date of the Form 8379. If the tax year has ended, input a credit transfer, TC 830/TC 710, using CC ADD48. When working an injured spouse case after offset of the original overpayment and the stimulus payment, you will input two adjustments. Do not advise the taxpayer they meet hardship criteria. You must take into consideration all TOP transaction codes with the same OTNs to determine the net TOP offset amount. Command Code ESTAB is used to request the entire block using the Document Locator Number (DLN). Close your case using Document Type-Internal Transcript, IDRS Cat Code IRRQ, Program Code 40000. If the taxpayer is MFJ and filed a zero or $1 return and there is a credit on the module you should determine if either spouse has a debt. Prepare Form 4442/e-4442 to forward case to the appropriate local Directorates AM Paper Function. Subtract any previous offset or refund, such as TC 820/TC 826, TC 840/TC 846, BMF or IRAF TC 896, attributable individually or jointly to the injured spouse, from the injured spouse's share of the joint overpayment. To reverse TOP offsets for scrambled SSN cases: Reverse an offset only when you can establish that the taxpayer who was offset absolutely was not the obligor. 11-2016 (MeF and Rev. Refer to IRM 21.6.3.6.8, Tax Year 2007 Offset Reversal Issues: Injured Spouse/Innocent Spouse/EITC. Determine the TC 898 offset to be reversed. ID Theft, Merge cases, Scramble cases etc.). A request was previously submitted. Verify that the corrective action is accurate before closing, Close your case using Document Type-Internal Transcript, IDRS Cat Code IRRQ, Program Code 40000. If you do not have access to CIS, refer to IRM 21.3.5.4.1, When to Prepare a Referral. Failure to input the PC 8 will result in an UPC 159. After getting through to Bureau of the Fiscal Service, select the option "If you are calling from a government agency.". We allocated the payment for you, giving each spouse one half of the SRP. This is commonly referred to as the "Full Collection" program. The Director of Accounts Management is responsible for policy related to this IRM. Declaration of any area, as a combat zone or Qualified Hazardous Duty Area (QHDA), affects certain military personnel who are listed as debtors and are participating in combat zone initiatives. TOP offsets are made against any refund issued from MFT 02, 03, 08, 07, 10, 13, 34, 43, 44, 46 (Doc Code 88 only) , 52, 60, 63, 64, 77, 78 and 79, unless a BPI is systemically generated on the refund or input on a manual refund. When the Form 8379, posts to the wrong spouse's TIN, work the form under the correct TIN, before reversing any offset to Office of Child Support Enforcement (Agency Codes 1 and/or 2), see IRM 21.4.6.4.2.4, Child Support TOP Offsets. If the Injured Spouse Allocation case is not assigned: Prepare Form 4442/e-4442 to forward the case to the appropriate AM Function where the taxpayer filed their original return. Provide the name and TIN of the taxpayer(s) and request confirmation of the existence of a debt, the amount(s) owed, and to which agency. The TC 766 posts with the return due date or return received date, whichever is later. If required, tell the taxpayer that further explanation will be sent in two to four weeks, if the injured spouse's portion is applied in some manner that will result in notice issuance, such as a credit transfer. If both spouses have income (see Note below), If one spouse has income (see Note below), The earned income is $12,903.00 or more (phased out with a MAGI of $150,000). , when to prepare a Referral base for paper and electronic filed Form to category and program code (! 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