If the undelivered or canceled refund, TC 740/TC 841, is less than the TC 840/TC 846, and credit interest, TC 770/TC 776, was included, then Master File (MF) prorates the amount of interest reversed. Guam and Puerto Rico community property jurisdictions recognized same-sex marriages starting in mid 2015. (09) Valid Request Bureau of the Fiscal Service considers the TC 766 request as valid but for a lesser amount. If the injured spouse is entitled to the entire overpayment, this computation is not needed. If you need to reverse a TC 898/TC 896 that is over six years contact the TOP Liaison , for a manual reversal. There will not be a corresponding TC 700 with this type of reversal. A manual reversal is required. The IAT Tool is designed to research CC INOLET when the invalid indicator is present. Ensure that there are no unpostable TC 898 or TC 899 transactions on the account. 13) Taxpayer says Form 8379 was filed after offset and no refund was received. Prepare MRR for dishonored amount and submit to NHQ. For more information on FTHBC, refer to, 9) Taxpayer's overpayment is being held by CI pending review of his/her tax return, There is a -Z or Z- Freeze on the account Questionable Refund Program (QRP). When working an account that contains a C freeze, additional research is required to determine the taxpayer's CZ status. See IRM 21.4.6.5.12.2, Manual Reversal of TOP Offset for more information. If information is not found on the primary account, research the X-REF TINs under both TINs to determine where the FTHBC was claimed. Director, Accounts Management If the taxpayer states they filed the Form 8379 in error or no longer wants the Form 8379, Injured Spouse Allocation, to be considered: Verify the request is from the injured spouse who filed the allocation. 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. DO NOT transfer the call if the taxpayer is simply asking about the status of their claim. Review the return and determine if the taxpayer can get relief as an "Injured Spouse" and refer them to Form 8379, Instructions. Form 8379, Injured Spouse Allocation, must be reviewed to determine that all income shown on the joint return has been properly allocated and verified. Once the tax is assessed (23C date), the overpayment is created and the offset occurs. However, if the CTC is claimed on the 2021 tax return it is subject to normal offset rules. The 17 week timeframe includes the 9 week processing timeframe for a corrected TPP Unpostable 126-0. Increase or decrease tax and credits to reflect the correct figures. 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. 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. If the case is assigned to a CSR and you do not have access to CIS, issue 4442/e4442 to the CSR. Bureau of the Fiscal Service initiates refund offsets to outstanding federal agency debts or child support, State Income tax obligations and Unemployment Compensation debts. App 35 assistors will make the determination if the taxpayer meets hardship criteria. Re-sequence an account when the offset is on the "from" account. BPI 8 generates on the first refund, TC 846, issued after the reversal of a TOP offset to a primary TIN's debt. If the tax offset was in violation of the automatic stay, follow Insolvency's instruction to reverse the tax offset and issue a manual refund with BPI 7. If a manual refund is issued, a TC 290 .00, HC and PDC are not needed, provided that Blocking Series 9 is input on your manual refund document. This allows for the Bypass Indicator (BPI) to be input and assigns ownership of the refund to the injured spouse for TOP offset purposes. If PENDMRR or MRRTONHQ is not present in the IDRS case control activity, then the TC 899 Type 3 is a BFS/IRS correction. The Treasury Offset Program debt indicator (F) is set when Bureau of the Fiscal Service informs Internal Revenue Service (IRS) that at least one TOP debt exists and an offset may occur if a refund is authorized. This occurs after a refund is certified by Internal Revenue Service (IRS) for payment by BFS, but before the refund check is issued. 18) Taxpayer says Form 8379, Injured Spouse Allocation was filed with or without original return. BPI (5) indicates that TOP should bypass all debts for the primary TIN and all debts except child support for the secondary spouse. The manual refund is issued in the injured spouse's name only, unless the injured spouse requested in writing or on Form 8379, Injured Spouse Allocation, that it be issued in both names. If the injured spouse is not entitled to any overpayment from tax year 20XX, the allocation should not be considered. If there is a balance due module; a freeze release will prompt an offset to that account. Advise the taxpayer to resubmit a signed Form 8379. See IRM 21.4.6.5.8.9, Form 8379, No Consideration Procedures, for instructions. Only the agency owed the debt can honor a hardship request to prevent a TOP offset or make a refund of the offset due to hardship circumstances. See paragraph (11) above. If part of the stimulus payment was offset and part was refunded to the taxpayers, deduct the refunded amount from the credit amount to determine if the injured spouse is entitled to any additional refund. Refer to IRM 21.5.6.4.31, P Freeze. If an offset has occurred to a separate tax liability for which the injured spouse is not responsible, compare the injured spouse's allocation to the amount of offset. Meaning, the TC 706 credits must transfer from one spouse on the originating account either as a single or separate filer or as a joint filer with a new spouse. 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. Form 8379, Injured Spouse Allocation, is not a separate claim. 11-2016) "Issue in both names" box on line 11 is checked. Review the form for the signature of the injured spouse, unless it was filed with an original signed return. A TC 899 type 2 (agency refund) for $45.00 is posted. Mary Cod filed single for 2013. Explain to the taxpayer that our records show the Form 8379 was not filed with the return. Compare dates and DLNs and correct the tax period on CC UPRES, if necessary. RC 6 results from an attempt to post a TC 899 with an XREF TIN that does not find a prior posted TC 898/TC 899 with the same XREF TIN (Not applicable to BMF). A refund offset to an outstanding IMF, BMF, or NMF tax debt is referred to as a tax offset. To refer the taxpayers to TAS, use Form 911, or Form e-911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), if AMS is not available. See IRM 20.2.4.7.5.2, 45-Day Rule and All Original Tax Returns, for the dates of systemically generated refunds. In Obergefell v. Hodges, 576 U.S. (2015), the United States Supreme Court held that (1) all states must allow same-sex couples to marry on the same terms and conditions as opposite-sex couples, and (2) states must recognize lawful same-sex marriages performed in other states. There may be more than one on the account. Take no further action until the manual reversal request has completed. Process Form 8379 based upon box checked. See IRM 21.5.3.2(3), What Are Claims for Credit, Refund, and Abatement?. If the taxpayer did not allocate the Charitable contributions split the unallocated Charitable contributions in half (50/50) for each spouse. They are intended for the Full Collection program. If 11-14 weeks have passed and the case has not been worked and is assigned to a CSR, and you have access to CIS, leave a Case Note for the CSR working the case. TC 150 is blocked 92, a TOP offset has or has not occurred, and Form 8379 was not worked and the case is closed. The TOP Liaison will open an IDRS control base, put MRRTONHQ in the activity section when the action has been initiated to the AM Process & Program Management Analyst. See IRM 21.4.6.4.2.9 TC 766 with OTN TOP Offset Reversal. BPI (1) (2), (8) and (9) are not valid when the BPI was set to (4). For TOP offsets, BFS issues the Notification of Offset that provides the creditor agency contact information. Inform the taxpayer that a note has been added to their account and to allow 30 days to process. If the Form 1040 or Form 1040-X was not timely per IRC 6511(a) and a 105C, Claim Disallowed, letter was previously sent, send a 916C, Claim Incomplete for Processing; No Consideration, letter and advise the taxpayer that we cannot consider Form 8379, Injured Spouse Allocation, since the return was not timely filed. If a TC 898 appears on the account after the manual reversal request (MRR) has been submitted. The taxpayer is sent a notice of offset by Bureau of the Fiscal Service for Treasury Offset Program offsets. The 2021 Child Tax Credit is up to $3,600 for each qualifying child. If the 45-day interest-free period is missed, allow credit interest on the overpayment. The credit will be calculated at a rate of 6.2 percent of earned income, and will phase out for taxpayers with a modified adjusted gross income more than $75,000 ($150,000 for married couples filing jointly) with total elimination at $95,000/$190,000. Effective January 1, 2014, IRC 5000A, Requirement to maintain minimum essential coverage, requires individuals to: have an exemption from the responsibility to maintain minimum essential coverage, or. The IRS issued three EIP payments: EIP 1 and EIP 2 (advance payments of the RRC for TY 2020), and EIP 3 (advance payment of the RRC for TY 2021). You may see a TC 971 AC 599 on the account representing a manual input of the TC 899 erroneously deleted. EITC, ACTC, and /or Adoption Credit) and a TC 811 is not present, do not consider the Form 8379 allocation. If the above timeframes have passed, the case has not been worked and there is an open control base assigned to a clerical site specialized control number or there is an open control base not assigned to specific CSR, and you are not trained to work Injured Spouse cases and do have access to CIS, leave a Case Note. Hold until the -Q freeze is released with TC 572 by EXAM or IVO. After all adjustments have posted, attempt to merge the accounts again. When the debt is overdue, the Treasury Offset Program (TOP) helps collect the debt by holding back money from a federal payment to the debtor. 17) Taxpayer says Form 8379, Injured Spouse Allocation was filed with or without original return. Advise the taxpayer of the reason for the offset. If the date of the refund check is not on or before that date, interest must be allowed on the refund. The Federal tax debt is under a previous spouse's TIN. The 45-day interest-free charts (located here) may also be used for determining what date your adjustment must be input to meet the 45-day interest-free period for a systemically generated refund. Subsequent payment/credit made dated on or after the due date (determined without regard to any extension of time for filing). the main home on the applicable disaster date was in a Midwestern disaster area as shown in Table 2 and the taxpayer was displaced from that home because of the severe storms, tornadoes, or flooding. You must input a History Item when you are referring the taxpayer to another agency for resolution. The TO date will be the 23C Date (assessment date) of the adjustment releasing the overpayment minus 18 calendar days. If the taxpayer wants to claim Innocent Spouse Relief, but mistakenly uses Form 8379, Injured Spouse Allocation. Once the RRC offsets to pay a TOP debt, it loses its identity as a RRC payment. See IRM 21.4.6.5.27.1, Injured Spouse Allocation/Recovery Rebate Credit (RRC). If you do not have access to CIS, refer to 21.3.5.4.1, When to prepare a referral. Rev. Advise taxpayer to allow five calendar days for direct deposit or 4 weeks for paper check to arrive. See IRM 21.4.6.4.2.1, TOP Offset Bypass Indicator (BPI). When this amount is then added to the portion of the joint overpayment belonging to the injured spouse, it results in a TC 766 amount of $4,220.99 ($4,200 + $20.99). RNs 810/811 will generate the refund in one name only. In the case of partial abatements, all TC 706 credits transferred from the same person. The refund generated from this reversal has a BPI of 1. If the TC 706 credit(s) is/are present and all four of the above items are true, move the applicable TC 706 credit(s) back to the modules where it/they originated. If the injured spouse is the primary taxpayer and Part II, line 11, box is checked on Form 8379 (Rev. Future year debt owed by the secondary taxpayer. A TC 899 type 1,2, 3 or 4 may have been deleted in error. Room 556 C Manual refunds issued from accounts with a -V or -W Freeze require input of BPI 3. If the TC 899 is unpostable, research the condition that caused the unpostable and make the necessary corrections to correct the taxpayer's account. Forward to the Non-Master File unit. Individual Income Tax Return, was not timely per IRC 6511 (a), or IRS determines there is no overpayment available for credit or refund per IRC 6511 (b), then there would be no joint credit or refund to offset or reallocate pursuant to Form 8379. there is a TC 898 or TC 971 AC 598 on the account, Determine if any of the refund amount was issued per. Take the following actions: Research IDRS, if a deleted unpostable (DU) 898 or a TC 971 AC 598 is on the account, contact the TOP Liaison for the paperwork to begin the manual reversal process. Research for Outstanding Balance Liabilities (OBLs) for both spouses before completing the allocation. For example, California stopped taking refunds until July 2021. If you are an employee assigned to Application 21 and you do not have access to CIS to view the Form 8379, Allocation Worksheet, or do not work injured spouse allocations: Check the Spanish box in Line 21, if applicable. 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. Refer to IRM 21.5.3.4.6.3 No Consideration Procedures. If the taxpayer filed their return on or before an approved extension of time to file, use the 04/15/XXXX of the return rather than the posted Return Received Date shown on TXMOD. Most of refunds are canceled for the original amount issued. IRS personnel do not have access to the TOP debtor database and cannot tell if a debt exists before a TOP offset occurs. Before the offset begins, a notice of intent to offset will be sent to your last known address to inform you that the offset is scheduled to begin in 65 days. Request the original return from Files, if it was not received with Form 8379 and the TC 150 is blocked 92. See IRM 3.17.794, Refund Schedule Number Format. Unpostable conditions must be resolved before inputting any TOP offset reversal. As a result, there can be one or two TC 898(s) for each refund issued. A manual refund is needed if a debt is owed to an agency other than Child Support. Therefore, discrepancies may arise from one cycle to the next and IRS may not be aware of a TOP debt. But a tax refund offset reversal can take up to six months for a . Input a Posting Delay Code for 1 cycle. 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. Add two days to the date of Input to allow for the two-day suspense for review. The TC 899 posts to the tax module with a type code (OFFST-REC-TYPE), amount, and the OTN of the TOP offset with which it is associated. They have requested a hardship refund of $600 to avoid eviction. If there is an open base with MRR/NHQ do not submit request for a manual reversal. Use the appropriate HC. On all Forms 8379 (Rev. This occurs when a TC 766 reverses a TC 898 with a debtor TIN. CC RFUND has a field entitled "BYPASS INDICATOR" . You will need to do a manual reversal request. A TC 898 may consist of two or more offsets to different agencies. Injured Spouse manual refund S- freeze TC 740, Taxpayer received Letter 3179C, Refund Offset to Treasury Offset Program (TOP) and Injured Spouse Inquiries, or another letter related to the Injured Spouse issue. The IRS also has information on this issue at IRS.gov/newsroom and IRS.gov/refunds. Satisfy the balance due on a superseding return. Continue to adjust the account using normal Mixed Entity procedures as outlined in IRM 21.6.2.4.2., Mixed Entity Procedures. Quality data and guidelines for measurement are referenced in IRM 21.10.1, Quality Assurance - Embedded Quality (EQ) Program for Accounts Management, Campus Compliance, Field Assistance, TEGE, Return Integrity and Compliance Services (RICS), and Electronic Products and Services Support. 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