See IRM 21.4.6.4.2.1, Top Offset Bypass Indicator (BPI). Taxpayers, who after completing Form 8962, find they have a repayment requirement, should not file Form 8962 or report the repayment amount as a tax liability. Ensure that there are no unpostable TC 898 or TC 899 transactions on the account. 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 Offset. Also, check for any OBL that may have occurred with a prior year-spouse. A TC 766 Reject Listing is created weekly. 7) Taxpayer says Form 8379 was filed with his/her original return and no refund was received. Any actions on the overpayment, either refund or offset, are prevented by the IDRS hold until the resolution of the IDRS Freeze condition. Use CC COMPA to compute the injured spouse's portion of the amount of credit interest based on the injured spouses reversal amount. Include taxpayer contact information and any details that the taxpayer gives which may help resolve the case. After January 15, 2021, EIP 2 could no longer be issued and had to be claimed on a 2020 return as RRC. If the allocation using the above formula results in no EITC for both spouses due to a loss claimed on the joint return, the EITC is allocated to the spouse claiming the loss, since it is that loss that qualified the joint account for the EITC. He or she may contact the TOP Call Center at 800-304-3107, TDD 800-877-8339 to determine if a debt is owed and an offset will occur. Always capture and/or attach INOLES or IAT Results IS screens for both spouses showing the debt indicator (I), (F), (B) or (N) at the time the Injured Spouse Allocation is being worked. Bypass TOP offset for primary TIN's debts and may offset to the Office of Child Support Enforcement for secondary TIN when an automatic stay is in effect or when the creditor agency has obtained relief from the automatic stay. The Transaction Code (TC) 899 is generated by input from Bureau of the Fiscal Service (BFS) and the participating agencies to report an action taken on an offset. Verify the Form 8379 has been processed in BS 920929. See exception below. 31 CFR 285.3 (h). Advise the taxpayer of the adjustment action taken. TOP offsets occur after the IRS has certified a refund to Bureau of the Fiscal Service for payment (TC 840/TC 846 on account), but before Bureau of the Fiscal Service issues the refund. Do not attempt to reverse the offset, merge the case without regards to the TC 898. In all cases, If the taxpayer can provide a copy of Form 8379 via fax, attach a copy of the faxed Form 8379 to the Form 4442/e4442. You may not be provided with any tracking number as refund checks are sent via U.S. mail. California and New Mexico recognized same-sex marriages starting in mid to late 2013. See paragraph (10) above. However, in some instances the recovery did not work. 4) Taxpayer says Form 8379 was filed with his/her original return and no refund was received. The injured spouse must have made payments such as Federal Income Tax Withheld from wages or estimated tax payments, unless they are entitled to one or more refundable credits claimed on the joint return, such as Federal Income Tax Withholding, Earned Income Credit, or Additional Child Tax Credit, etc. 807. For taxpayer inquiries regarding Refund Discrepancies: Advise the taxpayer to allow five calendar days for direct deposit and 4 weeks for paper check to arrive. Program Owner: Policy and Procedures BMF (PPB), Accounts Management (AM), Wage and Investment (WI). If the taxpayers are no longer living at the same address, send the letter to the injured spouse and a copy of the letter to both spouses. A tax offset reversal may be required if the taxpayer's response to the tax assessment results in either a full or partial abatement on a married filing joint (MFJ) account. The unpostable codes explained below deal with conditions specifically related to TOP offsets. Under these rights taxpayers have the right to receive prompt, courteous, and professional assistance in their dealings with the IRS, to be spoken to in a way they can easily understand, to receive clear and easily understandable communications from the IRS, and to speak to a supervisor about inadequate service. Complete Form 5792, Request for IDRS Generated Refund (IGR), or Form 3753, Manual Refund Posting Voucher, as required and process as follows: Write in the remarks section, "OBR" and the specific reason for issuing the manual refund along with IRM references which apply, notate the Bureau of the Fiscal Service contact name, the date of contact and no TOP debt. A UPC 134, RC 03, is an IMF unpostable that occurs when an account containing a full or partially unreversed TC 898 (net offset amount greater than zero) attempts to merge with another account, and the 23C date of the TC 898 is within six years of the current date. You will need to do a manual reversal request. Review the Form 8379, Injured Spouse Allocation for completeness. Please allow up to 180 days for the manual reversal to post. Transfer the credit to a liability of the injured spouse and/or issue a manual refund to prevent the credit from offsetting back to the same debt. Input the offset reversal using CC REQ54, blocking series (BS) 00 with original return or BS 05 without original, source code (SC) 7, and the appropriate reason code. A manual refund is required when Box 12 on Form 8379, Injured Spouse Allocation, is checked and the address on ENMOD is different than the address on the Form 8379. The RSED has expired see IRM 25.6, Statute of Limitations. That notice provides the creditor agency contact information. 1. Otherwise, the computer will automatically offset the credit(s) back to pay the balance due. There is now no remaining TOP offset and the taxpayers received the following refunds totaling $1,586.00. If applicable, refer taxpayer to TOP Call Center at 800-304-3107, TDD 8008778339 for offset information. A TC 520, with closing code 60-67, 81, or 83- 89 on the account with a transaction date prior to 10/17/2005, generates a BPI 3 on refunds that are issued systemically. Allocate any child tax credit, child and dependent care credit and additional child tax credit to the spouse who was allocated the qualifying childs exemption. If the tax module shows a Project Code of 0173, 0263, 0390, 0584, 0603 or 0611, these QRP cases are under the control of CI SDC and notice has been sent to the taxpayer. However, a debt may exist at Bureau of the Fiscal Service, see IRM 21.4.6.5.8.3, Processing of Form 8379 Injured Spouse Allocation, for instructions. See IRM 21.4.6.5.8.7(2), Incomplete Form 8379 Signed or Filed with Original Return. Notate, on the CIS case notes, the shortcut method used. This prevents a TOP offset to any debts owed by the primary filer. This is required for injured spouse allocation processing. AM Process and Program Management produces a Utility 50 Run in October of each year to determine the volume and money amount of unresolved Form 8379, Injured Spouse Allocations. Program Reports: The program reports provided in this IRM are for identification purposes for the AM Customer Service Representatives (CSRs) and Tax Examiners (TEs). "O" code the return for processing to prevent an erroneous refund. Include BMF screens when there is a X-REF EIN. Reverse a TOP offset to a creditor agency (other than the Office of Child Support Enforcement) that occurred after October 17, 2005 when the tax module contains an unreversed TC 520 with closing code 6067, 81, or 83-89. If you do not agree, you must submit a new Form 8379 allocating the payment as you determine. When TC 898/TC 899 posts, work your Injured Spouse case. The obligation is assessed as a tax on NMF, MFT 59. For ID Theft cases with fraudulent returns follow procedures found in IRM 21.4.6.4.2.12TOP Offsets Involving ID Theft and ID Theft with Fraudulent Returns. IRS will not be reversing any RRC tax offset which occurred before March 18, 2021, unless an Injured Spouse Allocation, Form 8379 is filed requesting the injured spouses share of the offset. The other spouse is entitled to $93 (1,500 x .062). Withholding credit is more than reported on the joint return and the income has been reported on the joint return. AM attempts to resolve the unpostable condition through research before contacting Bureau of the Fiscal Service. But a tax refund offset reversal can take up to six months for a jointly filed return. Reverse the TC 706(s) to the originating account and input TC 570 on the credit side. BPI (3) indicates TOP should bypass the refund completely. Bureau of the Fiscal Service, which administers the Treasury Offset Program, controls the offset of debts under IRC 6402(c)-(f). BPI (6) indicates that TOP should bypass all debts for the secondary TIN and all debts except child support for the primary spouse. The remainder of the overpayment refunds systemically when the "O" code return posts. Check the entity to see if the account was re-sequenced to another TIN. Certain BPIs also identify one of the spouses on a joint refund as eligible for offset. Refer to IRM 21.1.3.2, General Disclosure Guidelines, for more information. See IRM 21.4.6.5.12.2, Manual Reversal of TOP Offset. If the injured spouse is the primary taxpayer and Part II, line 11, is not checked on Form 8379 (Rev. Therefore, do not disclose this information to the taxpayer. For questions or to activate your card, visit the Contact information on this page. Refund offsets to child support, TOP debts, State income tax obligations, and Unemployment Compensation debts are handled by the Treasury's Bureau of the Fiscal Service, (BFS) formerly Financial Management Service (FMS), through the Treasury Offset Program. The account may contain a credit balance due to the undeliverable or cancelled check TC 740/TC 841), see IRM 21.4.6.5.22, Returned Refund Check. See paragraph (11) below. Refer to Document 6209, IRS Processing Codes and Information, for additional transactions and reason codes not shown here. ID Theft, Merge cases, Scramble cases etc.). Forward the case to the appropriate AM campus that worked the Form 8379. Input a TC 971, AC 036, via CC REQ77, on the credit module to identify that an offset liability was bypassed prior to the TC 840 manual refund. The manual refund must also have a BPI applicable to the injured spouse to show ownership of the refund for TOP offset eligibility. With a tax refund offset, taxpayers can either: Apply for the tax refund offset process, or. See this press release. Two additional weeks should be added to cases that will require two TC 766s with OTN transactions. If the Form 8379 is not attached to the joint Form 1040 or Form 1040X, but is instead filed separately, the timeframe for filing Form 8379 for Federal Tax Debts or TOP Debts is the same as the timeframe for filing the claim for refund (generally 3 years from the date the return was filed or 2 years from the date that the tax was paid, whichever is later, but there are numerous exceptions see IRC 6511 . $586.00 dated 03/06/2012 (TC 846 $1,586.00 TC 898 $1,000.00), $550.00 to the injured spouse dated 04/19/2012, $450.00 from the agency that received the offset. See IRM 21.4.6.4.2.11, Netting TOP Offsets and Reversals. Update the entity, if necessary, and use CC ACTON to establish a "dummy account" for IDRS generated refunds. (W) Failed Banks/Litigations Freeze: Complete thorough research of the account and modules to identify the -W (Litigations) freeze status. (Example: NCP SC1 PTC 50/50). When the injured spouse has none of the income or refundable credits, none of the overpayment is the injured spouse's. Once a state recognizes a same-sex marriage, community property laws apply to property held by those spouses. However, an EXAM freeze on an account which also has a -R freeze, may affect the timing when the injured spouse allocation is worked. If the interest payment was not offset with TC 898, then the TC 766 amount is simply the spouses share of the joint overpayment.Example: Using the above example and omitting the interest computations associated with TC 898, results in a TC 766 amount of $4,200. Each payments DLN will contain a unique sequence number to identify the month for which the payment was issued. The presence of this indicator does not guarantee a TOP offset will occur. If the taxpayer reported the SRP on their original return but did not allocate on Form 8379, allocate one-half the SRP tax for each spouse (50/50). For any ID Theft case that cannot be reversed, refer to IRM 21.4.6.4.2.12. Do not input TC 767 with OTN to correct a TC 766. See IRM 21.5.1.5.3 CIS Source Documentation, for Blocking series (BS) and NSD adjustment examples. 3) There is a posted TC 740 or TC 841 and the account shows TC 899 type 1 with the same OTN of the posted TC 898. The creditor agency may have obtained relief from the automatic stay. For all shortcut methods, if the RRC is claimed and the injured spouse is entitled to half of the RRC. You must make any necessary changes to the taxpayer's entity, based on the original return information, before issuing a manual refund from a module without a TC 150. See IRM 21.4.6.4.2.4, Child Support TOP Offsets. Issue a manual refund using BPI 1 and BS 9. When the address on a Form 8379, Injured Spouse Allocation, is different than on CC ENMOD, issue the refund to the address on the Form 8379, and send a Letter 104C, Address Change Acknowledged, asking the taxpayer if the address of record needs to be changed. See IRM 21.4.6.5.23, TOP Unpostable Conditions. For Taxpayers, Disputing the Debt or TOP Offset: IRS/TAS does not have the authority to bypass a TOP debt. The TOP Liaison will manually input the TC 971 AC 598 with OTN if the information is available for audit trail purposes. Take no further action on the account until the manual reversal request has completed. ", RC 087 - "we have corrected a math or processing error on your return. Therefore, do not disclose this information to the taxpayer. Form W-2, Wage and Tax Statement. Examples of offsets which can never be reversed using a TC 766 are: A TC 971 AC 598 (manual input of TOP offset record) is input on an account for audit trail purposes for an erroneously deleted TC 898. The late return received date, the date of the overpayment (as determined in the preceding table), or the return processable date. Review question 5 on Form 8379 to determine if the taxpayer resides in a community property state. Do not input a TOP offset reversal when the 23C date is over 6 years old. Include taxpayer contact information and any details that the taxpayer gives that may help resolve the case. Disregard the instructions in IRM 21.5.6.4.35.3, -R Freeze Modules with Integrity & Verification Operation (IVO) Involvement. Advise the taxpayer to allow 8 weeks for processing. 1) Taxpayer claims he/she didn't receive a refund of overpayment. All taxpayer refunds may be subject to offset. See IRM 21.4.6.4.2.1, TOP Offset Bypass Indicator (BPI). Businesses and nonprofits with 750 employees or less may be eligible for a COVID-19 Disaster Relief Loan Guarantee up to $1 million. This tolerance applies to both IMF and BMF. 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. Advance CTC is not subject to offset. CC ADJ54 has a field for input of the OTN in position 6474 of line 6. If you receive a call and the account shows any type of CI involvement you may advise the taxpayer that their return is being reviewed but do not advise of CI involvement. Research CIS for an explanation of the no consideration and explain the reason for the no consideration to the taxpayer. This is done on a case-by-case basis and each case may vary. Refer to IRM 21.4.6.4.2.11, Netting TOP Offsets and Reversals. This occurs when a TOP offset reversal, TC 766 with OTN, was denied by Bureau of the Fiscal Service (subsequent TC 767 in the module with the same OTN). See IRM 21.4.6.5.12.2, Manual Reversal of TOP Offset, for additional instructions. ECC-MTB searches this file after any applicable tax offsets are determined but before crediting the credit elect amount. Normal offset rules apply to the Unemployment Compensation Exclusion. All letters or documents from an agency and addressed to IRS are sent back to agency headquarters or Bureau of the Fiscal Service if they concern: Removal of the debtor from the Treasury Offset Program. Even if you owe student loans, you still can get your tax refund due to the Covid-19 pandemic. 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. We allocated the repayment for you, giving each spouse one half of the excess APTC repayment. Public Law 93-647 authorizes the collection of child support debts through this "Full Collection" procedure. 15) Taxpayer says Form 8379 was filed after offset and no refund was received. Emergency refunds are those based on hardship where the taxpayer needs the refund in less than 5 days. A TC 898 or TC 971 AC 598, originating from a computer-generated refund, will match the date of the TC 846. A TC 898 or TC 971 AC 598 (manual input of TOP offset record) may be present on the tax module even though the indicator is set to "0" . The agency refunded the remainder of the TOP offset originating from the TC 846 dated 03/06/2012 to the taxpayer. Only allow the TC 766 posting to generate the TC 846 when the injured spouse refund will be issued in both names. The injured spouse's refund could be equal to or less than the amount that offset to the debt. There can be one or two TC 898(s) or TC 971 AC 598(s) per refund. Upon each cycle's completion, the TOP Liaison will send an e-mail to IRS Headquarters Analyst acknowledging that the listing has been processed. For taxpayer inquiries regarding bankruptcy and a tax offset, immediately call the Centralized Insolvency Operation (CIO) or fax Form 4442, Inquiry Referral, clearly labeled "Expedite" to the CIO before making any account adjustments so the potential stay violation may be resolved within 48 hours. If a taxpayer calls and wants to update their address after filing Form 8379, refer to IRM 3.13.5.49, Updating Address Records for instructions. Do not route a copy or your original injured spouse case to EXAM, Criminal Investigation (CI) or IVO. Advise the taxpayer to allow up to 8 weeks from the time they re-file the Form 8379. The following table may assist you in resolving injured spouse cases when an EXAM freeze (-L, -Q, - E), CI freeze (-Z or Z-) or IVO Freeze (-E) is present. After 2018, the SRP is $0.. See IRM 21.4.6.5.10.6, Issuing the Injured Spouse Refund. One adjustment will be for the original overpayment and the second adjustment will be for the ESP. When a manual refund is required, Form 5792 must be processed no later than the 42nd day when the 43rd day is a work-day. Based on the new Treasury regulation that limits the time which Treasury may reverse a tax refund offset to child support (up to 6 months), BFS may not return the funds to the IRS. Box 183050 Columbus, OH 43218-3050 Telephone: 1-800-282-1780 Fax: 1-206-339-4207 TTY/TDD: 1-800-750-0750 tax.ohio.gov TAXPAYER NAME ADDRESS LINE 1 ADDRESS LINE 2 Notice ID: 0023 Date: March 03, 2019 Social Security Number(s): XXX-XX-1234, XXX-XX-5678