Section 217 - Form 1120-s Corporation Income Tax Returns
3.11.217 Form 1120-S Corporation Income Tax Returns
Manual Transmittal
November 21, 2025
Purpose
(1) This transmits revised IRM 3.11.217, Returns and Documents Analysis, Form 1120-S Corporation Income Tax Returns.
Material Changes
(1) IRM 3.11.217.2.13(1), Tribal Tax Credit Scheme - Added in "Section 6418" to the list of non-valid credits. (IPU 25U3503 issued 07-18-2025)
(2) IRM 3.11.217.2.13(2), Tribal Tax Credit Scheme - Changed "SSPN 211" to "edit Action Code 211." Revised the bullet statement conditions and added a note not to detach the Schedule K-1 (Form 1120-S). (IPU 25U3553 issued 08-11-2025)
(3) IRM 3.11.217.2.13(2) a), Tribal Tax Credit Scheme - Deleted "Use the following literal." and "Line 13, Schedule K (Form 1120-S)" to "Box 13, Schedule K-1 (Form 1120-S)." (IPU 25U3553 issued 08-11-2025)
(4) IRM 3.11.217.2.13(2), Tribal Tax Credit Scheme - Revised the conditions for when corresponding for a statement identifying the credit claimed. (IPU 25U3503 issued 07-18-2025)
(5) IRM 3.11.217.2.13(3), Tribal Tax Credit Scheme - Changed "Line 13, Schedule K (Form 1120-S)" to "Box 13, Schedule K-1 (Form 1120-S)." Changed the sub paragraphs a) and b) to bullet statements and changed the action to be taken. (IPU 25U3553 issued 08-11-2025)
(6) IRM 3.11.217.2.13(3), Tribal Tax Credit Scheme - Revised the procedures for when a statement is attached identifying the credit as one of the Tribal Tax Credit Schemes. (IPU 25U3503 issued 07-18-2025)
(7) IRM 3.11.217.2.13, Tribal Credits Scheme - New procedural section for schemes identified as Tribal Tax Credit, Native American Tax Credit, and Sovereign Tribal Tax Credit. being claimed. (IPU 25U3451 issued 06-30-2025)
(8) IRM 3.11.217.2.13, Tribal Tax Credit Scheme - made the following changes:
Changed the title to "Tribal Tax Credit."
In (1) changed "was" to "has" .
In (2) Revised the three bullet statements procedures to ensure Code & Edit identifies conditions for proper action to be taken.
In (2)a) moved the reference Form 8300, Part III to follow the line number reference.
In (3) revised the procedures to include additional actions to be taken.
Deleted (4) procedure since the revision of (3) covers the condition. (IPU 25U3460 issued 07-03-2025)
(9) IRM 3.11.217.3.1, Action Codes - In (7) deleted the note for Telephone Excise Tax Refund (TETR) in the description for Action Code 420. Revised the description for Action Code 450, and 460. (IPU 25U0066 issued 01-17-2025)
(10) IRM 3.11.217.3.7, Statute Returns - Change in (3) seventh bullet statement the tax years "2020" to "2021." (IPU 25U0394 issued 03-19-2025)
(11) IRM 3.11.217.3.9, Amended Returns - In (5) added a note regarding Line 13, Schedule K (Form 1120-S) has a code ZZ. (IPU 25U3451 issued 06-30-2025)
(12) IRM 3.11.217.3.9(5), Amended Returns - Changed "Line 13, Schedule K (Form 1120-S)" to "Box 13, Schedule K-1 (Form 1120-S)." (IPU 25U3553 issued 08-11-2025)
(13) IRM 3.11.217.11, Initial Return Code - Page 1, Box G - Added to (1) d) 2026 Tax Period ending and the 24-month cutoff date.
(14) IRM 3.11.217.15.1, Sequence of Return - Form 1120-S - Made the following changes in (1):
Deleted the IRM references for the forms listed since these IRM references can be found in the Table of Contents.
Moved Form 4797, Sales of Business Property to follow Form 8996, Qualified Opportunity Fund
Deleted Form 8050, Direct Deposit of Corporate Tax Refund.
Added Form 8283, Non cash Charitable Contribution to the sequence list with a note with regards to additional forms attached.
(15) IRM 3.11.217.15.2, Positive/Negative Figures - Added in (3) to line 28a note “2023 - 2024 Line 28 and.”
(16) IRM 3.11.217.16.3, Line 4 - Net Gain (Loss) - Added in (2) Form 4797 Line number and Line descriptions.
(17) IRM 3.11.217.18, Lines 23a -28, Lines 22a - 27 (2022 & prior) - Tax and Payments Page 1 - Title was changed to include the 2022 & prior line numbers. (2) procedure was updated to include 2022 and prior editing and definition of significant entry. (IPU 25U3553 issued 08-11-2025)
(18) IRM 3.11.217.18.1, Lines 23b, Lines 22b (2022 & prior) - Tax from Schedule D (Form 1120-S) - Title was changed to include the 2022 & prior line number. Deleted old (2) and replaced with new (1) procedure for 2022 and prior editing and definition of significant entry. (IPU 25U3553 issued 08-11-2025)
(19) IRM 3.11.217.18.2, Line 23c, Line 22c (2022 & prior) - Total Tax - Title was changed to include the 2022 & prior line number. Deleted old (3) and replaced with new (1) procedure for 2022 and prior editing and definition of significant entry. (IPU 25U3553 issued 08-11-2025)
(20) IRM 3.11.217.18.3, Line 24a - Estimated Tax Payments - Added to (2)the year 2022 and prior editing procedures and the definition of significant entry. (IPU 25U3553 issued 08-11-2025)
(21) IRM 3.11.217.18.4, Line 24b, Line 24c (2022 & prior) - Tax Deposited with Form 7004 - Title was changed to include the 2022 & prior line number. Deleted in (2) the note and added new (1) procedure for 2022 and prior editing and definition of significant entry. (IPU 25U3553 issued 08-11-2025)
(22) IRM 3.11.217.18.5, Line 24c (2023 & later), Line 23c (2022 & prior) - Credit for Federal Tax Paid on Fuels – Form 4136 - Title was changed to include 2022 & prior line number. Deleted in (2) the note and added new (1) procedure for 2022 and prior editing and definition of significant entry. (IPU 25U3553 issued 08-11-2025)
(23) IRM 3.11.217.18.6, Line 24d (2023 & later) - Elective Payment Election Amount from Form 3800 - Added new procedural section. (IPU 25U3553 issued 08-11-2025)
(24) IRM 3.11.217.18.7, Line 23d Add lines 23a through 23c (2021 year revisions and 2017 - 2007 revision Form 1120-S - Old procedural section. These procedures have been moved to the current year procedures in IRM 3.11.217.18.9 - Line 24z (2023 & later), Line 23d (2022, 2021, 2017 & prior), Line 23e (2018 - 2020) - Tax and Payments. (IPU 25U3553 issued 08-11-2025)
(25) IRM 3.11.217.18.7, Line 23d (2020-2019) - Reserved (2020 - 2019 revision Form 1120-S) - Title was changed to include the 2022 & prior line number. Added in (1) the tax year range and deleted (2) procedure since procedure (1) will take care of an entry present for the years 2019 - 2020. (IPU 25U3553 issued 08-11-2025)
(26) IRM 3.11.217.18.8, Line 23d (20218) - Refundable Credit from Form 8827 - Title was changed to include the year 2018. Changed in (1) "then “X” the entry. Continue processing the return" to "must be attached to the return. If the form is not present, correspond for the missing form." Delete the note regarding 2022, 2021, 2017. (IPU 25U3553 issued 08-11-2025)
(27) IRM 3.11.217.18.9, Line 24z (2023 & later), Line 23d (2022, 2021, 2017 & prior), Line 23e (2018 - 2020) - Tax and Payments - Title was changed to include the 2022 & prior line numbers. Added new (1) procedure for editing prior year lines number to current year return line number format. Added new (2) procedure for Tax Year 2023 and later. Added new (3) procedure for 2022, 2021, 2017 and prior. Added new (4) procedure for Tax Year 2018 - 2020. Delete old (5) when line 23e has an entry and no entries are present on lines 23s through 23d.(IPU 25U3553 issued 08-11-2025)
(28) IRM 3.11.217.18.10, Line 25 (2023 & later), Line 24 (2022 & prior) - Estimated Tax Penalty - Title was changed to include the 2023 & prior line numbers. revised (2) procedures to include the 2023 and prior lines numbers and the editing to 2024 line number format.(IPU 25U3553 issued 08-11-2025)
(29) IRM 3.11.217.18.11, Lines 26 and 27 (2023 & later), Lines 24 and 27 ( 2022 & prior ) - Amount Owed/Overpayment - Title was changed to include the 2023 & prior line numbers. Added new (1) procedure for Line 25, Form, Form 1120-S. Added new (2) for Line 26, Form 1120-S. Added new (3) procedures to include the 2023 and prior line numbers and the editing to 2024 line number format.
(30) IRM 3.11.217.18.11, Line 24z - Add lines 24a through 24d (2301 Form 1120-S revision and later) - Delete. The procedures for this sub sections have been moved to IRM 3.11.217.18.9 - Line 24z (2023 & later), Line 23d (2022, 2021, 2017 & prior), Line 23e (2018 - 2020) - Tax and Payments.(IPU 25U3553 issued 08-11-2025)
(31) IRM 3.11.217.18.13, Line 24, Estimated Tax Penalty (2022 - 2018 Form 1120-S revision) - Deleted old subsection. These procedures are no longer needed once the editing of the line 24 to 2024 form format is done. The procedures in IRM 3.11.217.18.10, Line 25 (2023 & later), Line 24 (2022 & prior) - Estimated Tax Penalty will take care of the additional editing that is needed. (IPU 25U3553 issued 08-11-2025)
(32) IRM 3.11.217.18.14, Lines 28b, 28c, & 28d - Direct Deposit Information - Added new subsection procedures.
(33) IRM 3.11.217.24.8, Schedule K, Line 13g - Other credits - Added new procedure for Other Credits claimed and updated the procedures for Form 8936, Schedule A, Clean Vehicle Credits. (IPU 25U0317 issued 03-06-2025)
(34) IRM 3.11.217.24.13, Schedule K, Line 17d - Other items and amounts - Added in (1) "and the Tax Period is 201712 - 202012 " to the condition for when to edit CCC "J" .
(35) IRM 3.11.217.30, Schedule D (Form 1120-S) - Capital Gains and Losses and Built-in Gains - Added in (1) table procedure 3) reference to “Part 1, Line 5 (2025 and later).”
(36) IRM 3.11.217.31, Form 4797 - Sales of Business Property - Added New (1) for Form 4797 line transcription and descriptions. Deleted Old (1), (2), and (3). They are no longer needed since they are included in new (1).
(37) IRM 3.11.217.39, Replaced the bullet statements with a procedure table and changed "Line 13, Schedule K (Form 1120-S)" to "Box 13, Schedule K-1 (Form 1120-S)." (IPU 25U3553 issued 08-11-2025)
(38) IRM 3.11.217.39(3), Form 3800 - General Business Credit - Deleted the tolerance and Changed "Tribal Credits Scheme" to "Tribal Tax Credit Scheme." (IPU 25U3460 issued 07-03-2025)
(39) IRM 3.11.217.39(1), Form 3800, General Business Credit - Added procedure note for Form 3800, Part, III, Line 1, Columns (b), (f) and (g).
(40) IRM 3.11.217.39(3), General Business Credit - Added new procedure for Form 3800, Part III, Line 1zz. (IPU 25U3451 issued 06-30-2025)
(41) IRM 3.11.217.39(3), Form 3800 - General Business Credit - Revised the conditions for Tribal Tax Credit Scheme. (IPU 25U3503 issued 07-18-2025)
(42) IRM 3.11.217.39(4), Form 3800, General Business Credit - Added in table Form 3800, Part, III, Line 1, Columns (b), (f) and (g).
(43) IRM 3.11.217.41, Form 8283, Noncash Charitable Contributions - Added new procedural section.
(44) IRM 3.11.217.44(6) - Schedule K-1 - Shareholder’s Share of Income, Deductions, Credits, etc. - changed "Line 13, Schedule K (Form 1120-S)" to "Box 13, Schedule K-1 (Form 1120-S)." (IPU 25U3553 issued 08-11-2025)
(45) IRM 3.11.217.45, Schedule K-1 - Shareholder’s Share of Income, Deductions, Credits, etc. - In (1) added a note regarding prior to detaching Schedule K-1. Added a new (8) procedure for Line 13, Schedule K (Form 1120-S) has a code ZZ. (IPU 25U3451 issued 06-30-2025)
(46) Exhibit 3.11.217-2, Due Date Chart - Added Tax year 2026 due dates.
(47) Exhibit 3.11.217-9 - Added Form 3800 - Prior Year Revisions Comparison Chart.
(48) Revised the IRM, where necessary, for the following types of editorial changes:
Tax Year from 2024 to 2025 and 2025 to 2026
Plain language, simpler words
Spelling, grammar, and formatting
IRM references, citations, and links
Form titles
IRM graphics and alternative text
Minor editorial changes (e.g., line number updates, spelling, punctuation, links, etc.)
Effect on Other Documents
IRM 3.11.217, Returns and Documents Analysis, Form 1120-S Corporation Income Tax Returns, dated November 14, 2024 (effective January 1, 2025, is superseded. The following IRM Procedural Updates (IPUs) have been incorporated into this IRM: 25U0066 issued January 17, 2025, 25U0317 issued March 06, 2025, 25U0394 issued March 19, 2025, 25U3401 issued June 12, 2025, 25U3451 issued June 30, 2025, 25U3460 issued July 03, 2025, 25U3503 issued July 18, 2025, 25U3553 issued August 11, 2025.
Audience
Taxpayer Services (TS) Submission Processing Code and Edit (C&E) personnel are the intended audience for this IRM.
Effective Date
(01-01-2026)
Scott Wallace
Director, Submission Processing
Taxpayer Services
3.11.217.1 (01-01-2025)
Program Scope and Objectives
This subsection has instructions for Form 1120-S, U.S. Income Tax Return for an S Corporation. Form 1120-S is used to report the income, gains, losses, deductions, credits, etc., of a domestic corporation or other entity for any tax year covered by an election to be an S Corporation.
Purpose: This subsection gives instructions for Document Perfection Operation (DPO) Code and Edit (C&E) for coding and editing (perfecting) returns and other documents.
Audience: These procedures apply to Taxpayer Services (TS) Submission Processing (SP) Code and Edit (C&E) personnel:
Supervisory Tax Technician
Lead Tax Technician
Tax Examining Technician
Supervisory Clerk
Lead Clerk
Clerk
Policy Owner: Director, Submission Processing.
Program Owner: Return Processing Branch, Business Master File (BMF) Section.
Primary Stakeholders: Other areas that may be affected by these procedures include (but are not limited to):
Accounts Management (AM)
Chief Counsel
Compliance
Information Technology (IT) Programmers
Large Business and International (LB&I)
Modernized Electronic Filing (MeF) or Modernized e-file (MeF)
Small Business Self-Employed (SBSE)
Statistics of Income (SOI)
Submission Processing (SP)
Tax Exempt and Government Entities (TEGE)
Taxpayer Advocate Service (TAS)
3.11.217.1.1 (01-01-2022)
Background
Document Perfection codes and edits (perfects) returns and documents for input to Master File (MF) through the Integrated Submission and Remittance Processing System (ISRP) and the Service Center Recognition Image Processing System (SCRIPS).
Document Perfection forwards documents and attachments not related to the processing of the returns to the function responsible for handling.
Code and Edit does not mathematically verify or check the validity of returns and other documents being processed unless otherwise specified in the applicable section.
3.11.217.1.2 (01-01-2021)
Authority
Authority for these procedures is found in the following sections of the Internal Revenue Code and their corresponding Treasury Regulations:
IRC 6201(a)
IRC 6213(b)
Policy Statements for Submission Processing are contained in IRM 1.2.1, Servicewide Policies and Authorities, Servicewide Policy Statements.
3.11.217.1.3 (01-01-2018)
Roles and Responsibilities
The Campus Director monitors operational performance for the Submission Processing campus.
The Operations Manager monitors operational performance for their operation.
The Team Manager/Lead conducts performance monitoring and ensures employees have the tools to perform their duties.
Team employees follow the instructions contained in this IRM and maintain updated IRM procedures.
3.11.217.1.4 (01-01-2022)
Program Management and Reviews
Program Goals: Make sure documents are code and edit ready for transcription.
Program Reports: The Batch Block Tracking System (BBTS) captures and stores a vast amount of data which can be used in performance monitoring and production projections.
Program Effectiveness: The program goals are measured by using the following tools:
Embedded Quality Submission Processing (EQSP)
Balanced Measures
Managerial Reviews
Annual Review: The processes outlined in this IRM must be reviewed annually to make sure accurate and promote consistent tax administration.
3.11.217.1.5 (01-01-2022)
Program Controls
- Quality Review conducts a statistical valid sample size review of completed work to make sure IRM guidelines are followed.
3.11.217.1.6 (01-01-2022)
Terms and Acronyms
The table below lists Interpretation Words and their definitions.
Word Definition Example of using a word that is open to interpretation ### Note: This column is for illustration purposes only. Fair Provide accurate and professional service to all persons without regard to personal bias. Per the Taxpayer Bill of Rights (TBOR), taxpayers have the right to expect a fair and just tax system which gives taxpayers the opportunity to have their facts and circumstances considered when it might affect their underlying liabilities, ability to pay, or ability to give information timely. Significant Entry Any entry other than zero or blank. Place Form 8941, Credit for Small Employer Health Insurance Premiums, in sequence order if significant entries are present. Timely Coming early or at the right time. Taxpayers have the right to receive help from the Taxpayer Advocate Service (TAS) if they are experiencing financial difficulty or if the IRS has not resolved their tax issues properly and timely through normal channels. See Exhibit 3.11.217-1, Acronyms and Abbreviations, for a list of commonly used acronyms and abbreviations.
3.11.217.1.7 (01-01-2025)
Related Resources
The following resources will help in performing the work as outlined in this IRM.
Servicewide Electronic Research Program (SERP)
Integrated Data Retrieval System (IDRS)
Instructor’s Corner for Submission Processing
Integrated Automation Technologies (IAT)
IRM 3.12.217, Error Resolution, Error Resolution Instructions for Form 1120-S
IRM 3.24.16, ISRP System - Corporation Income Tax Returns
3.11.217.2 (01-01-2022)
General Information
The purpose of this subsection is to give instructions for general required processing actions on Form 1120-S, U.S. Income Tax Return for an S Corporation, to eliminate repetition of the same instructions in different subsections.
In case of a conflict of instruction between this general subsection and the subsequent specific subsection, the specific subsection will govern.
This IRM can’t address every possibility that occurs while perfecting returns or documents. Take taxpayer intent into consideration. Refer issues not addressed in this IRM to the Subject Matter Expert (SME), lead or manager to determine the corrective action.
3.11.217.2.1 (01-31-2024)
♦Business Master File (BMF) Consistency♦
The purpose of this initiative is to achieve consistency in the Business Master File (BMF) Code and Edit (C&E) processing IRMs.
Ogden, Kansas City, and Return Processing Branch, BMF Code and Edit and Error Resolution System (ERS) identified and developed topics for BMF Consistency.
A ♦ (diamond) before and after the subsection title shows BMF Consistency subsections.
Text in normal print is the common processes for BMF returns. The text in BOLD print is form specific and applies to this IRM only.
3.11.217.2.2 (04-24-2024)
♦IRM Deviation Procedures♦
- When procedures deviate from the IRM, 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.
3.11.217.2.3 (01-01-2025)
♦Taxpayer Advocate Service (TAS)♦
The Taxpayer Advocate Service is an independent organization within the Internal Revenue Service (IRS), led by the National Taxpayer Advocate, that helps taxpayers and protects taxpayer rights. TAS offers free help to taxpayers when a tax problem is causing a financial difficulty, when they have tried and been unable to resolve their issue with the IRS, or when they believe an IRS system, process, or procedure just is not working as it must. TAS strives to ensure that every taxpayer is treated fairly and knows and understands their rights under the Taxpayer Bill of Rights. TAS has at least one taxpayer advocate office located in every state, the District of Columbia, and Puerto Rico.
TAS uses Form 12412, Operations Assistance Request (OAR), to start the OAR process of referring a case to the Taxpayer Services (TS) Division, to affect the resolution of the taxpayer’s problem. For more information, refer to IRM 13.1.19, Taxpayer Advocate Service, Taxpayer Advocate Case Procedures, Advocating With Operations Assistance Requests (OARs).
Refer taxpayers to TAS when the contact meets TAS criteria, or when Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), is attached and steps cannot be taken to resolve the taxpayer's issue the same day. See IRM 21.1.3.18, Taxpayer Advocate Service (TAS) Guidelines.
The definition of "same day resolution" is within 24 hours. The following two situations meet the definition of "same day resolution" :
The issue can be resolved within 24 hours.
The IRS takes steps within 24 hours to resolve the taxpayer’s issue.
When making a TAS referral, use Form 911, and forward to TAS following your local procedures.
For more information, see IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria, and IRM 13.1.7.4, Exceptions to Taxpayer Advocate Service Criteria, for information on cases that TAS will no longer accept.
3.11.217.2.3.1 (01-01-2025)
♦TAS Service Level Agreements (SLAs)♦
The National Taxpayer Advocate reached agreements with the Commissioners or Chiefs of the Taxpayer Services (TS) Division, Small Business/Self Employed (SBSE) Division, Tax Exempt Government Entities (TEGE), Criminal Investigation (CI), Independent Office of Appeals, and Large Business and International (LB&I), that outline the procedures and responsibilities for processing Taxpayer Advocate Service (TAS) casework when either the statutory or delegated authority to complete case transactions rests outside of TAS. These agreements are known as Service Level Agreements (SLAs).
The SLAs are found at Taxpayer Advocate Service (TAS), Service Level Agreements (SLAs)
3.11.217.2.4 (01-01-2024)
Business Master File (BMF) Identity (ID) Theft
BMF Identity (ID) Theft is increasing. If a case is found with attachments or correspondence showing the taxpayer is a victim of "ID Theft" , give the entire case to the manager/lead.
The manager/lead expedites the case to the Planning and Analysis (P&A) staff for referral to one of the Submission Processing (SP) BMF ID Theft liaisons. The taxpayer must show they are a victim of "ID Theft;" do not send cases subject to Criminal Investigation (CI), Examination (Exam), or Fraud review.
Effective January 1, 2017, Computer Condition Code "E" will be edited on Form 1120-S (any year) by the BMF ID Theft Liaison to identify a potential identity theft filing. See IRM 3.11.217.14.3, CCC "E" - Potential Identity Theft Filing, for more information.
3.11.217.2.5 (01-01-2022)
♦Criminal Investigation (CI) Referral♦
Criminal Investigation (CI) investigates potential criminal violations of the Internal Revenue Code (IRC) and related financial crimes. Criminal violations of the IRC include willful effort to evade or defeat the income tax. Criminal tax violations also include the willful failure to collect or pay over tax and false claims for refunds based on bogus return information.
If CI stamped the return, do not send for further CI action.
For returns with refund claims ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, do the following:
Refund Claim Ogden and Kansas City ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ 1. Make a copy of the first two pages of the return along with any page of the return that appears suspicious 2. Attach Form 4227, Intra-SC Reject or Routing Slip, to the copy. 3. Route the copy to Ogden, Mail Stop 9001, Criminal Investigation (CI). 4. Edit an action trail "Copy to CI" , or "CI Referral" , or similar language in the lower left corner going vertically up the side of the return. 5. Edit Action Code 341 on the return. See IRM 3.11.217.3.11, Refund Returns 45 Day Jeopardy and High Dollar Refunds. 6. Continue processing the return. Because of the repetitive nature of the Code and Edit (C&E) function, C&E Tax Examining Technicians often recognize income tax return data that is outside of the norm for data found on similar returns for each income tax return type. If C&E finds return characteristics not meeting Audit Code or Exam referral criteria it considered suspicious, CI is available to review the referral.
If you find a suspicious return, do the following:
Make a copy of the first two pages of the return along with any page of the return that appears suspicious.
Attach Form 4227, Intra-SC Reject or Routing Slip, to the copy.
Route the copy as shown in the table below.
Submission Processing Campus/Center Route the copy to: Ogden Mail Stop 9001, Criminal Investigation (CI) Kansas City Mail Stop S2 9000, Criminal Investigation (CI) Edit an action trail "Copy to CI" , or "CI Referral" , or similar language in the lower left corner going vertically up the side of the return.
Continue processing the return.
If the return fits other criteria (for example Frivolous Argument), take proper action.
3.11.217.2.6 (01-01-2025)
♦Examination (Exam) "Funny Box" ♦
- The primary goal in identifying tax returns for Examination (Exam) is to promote the highest degree of voluntary compliance. Exam gives support and helps Submission Processing (SP) with any questionable return found during processing. Exam has a vast multitude of programs and tolerance criteria already found in several IRM sections and subsections. SP can refer any questionable return to Exam, unless prohibited by instructions currently found in several IRMs.
3.11.217.2.7 (01-01-2025)
♦Edit Marks♦
Edit marks are edited on the return for transcription to the Automated Data Processing (ADP) System through Integrated Submission and Remittance Processing (ISRP) System. Enter edit marks in brown, red, orange, purple, or green pencil or pen.
Only edit items on the return that are for transcription except where specific instructions require editing of a non-transcribed item. Leave lines blank if the entry would be a zero amount unless otherwise instructed.
Do not obliterate, alter, or erase the original entry on a return when deleting or correcting an entry. Always exercise care to make sure that the original entry remains legible. Perfected entries provide a legible "edit trail" for anyone who will work with the return later.
Do not re-edit edit marks entered by other areas, such as Collections, Entity or Accounts Management, except to place the marks in the correct area or perfect for legibility.
Exception:
Photocopied Returns.
Photocopied Returns - Re-edit or underline any valid, black edit marks. See IRM 3.11.217.3.4.3, Correspondence Imaging Inventory (CII) Returns, and IRM 3.11.217.3.8, Re-Entry Document Procedures.
For a description of specific edit marks, see the table below:
Edit Mark Description "X" Deletes tax data or shows do not transcribe an item. For example, if deleting an original entry, edit an "X" to the left of the entry to delete. Edit the correct entry to the left or above the "X." "/" (slash) Indicates do not transcribe a form or schedule. "//$" Identifies the beginning and ending of a foreign country code in the entity area. For example, "/EI/$" is edited for "Ireland" or "/GM/$" is edited for "Germany." "%" or "c/o" Indicates an "in-care-of" name for transcription. Circle Indicates do not transcribe an entry. Also, deletes entity data or a Received Date. ### Note: If the taxpayer circles an entry, edit the entry. Underline Identifies an entry for transcription (e.g., Name Control, Tax Period, etc.). Arrow Indicates the correct placement of a misplaced entry. Use an arrow if the misplaced item is close to the correct line and there is no question where the entry belongs. ### Note: Use a double arrow to identify the same figure for transcription in two different places (along with any required transcription data between the two arrows). Check Mark Indicates that an entry was manually math verified and is correct. Bracket/Parenthesis Indicates a negative numerical amount. ### Note: Code and Edit (C&E) is not required to bracket negative amounts when brackets are preprinted on the form or schedule or when the taxpayer clearly shows a negative amount with brackets "()," or "-" sign. Bracket negative amounts when editing negative entries on transcription lines (e.g., computing and entering a line entry, entering a missing line entry, etc.). Vertical Line or Decimal Point Indicates the separation of dollars and cents. Zero, Dash, None, or N/A "ZERO," "DASH" , "NONE" , or "N/A" are valid entries except when specific instructions require editing of an entry. Rocker Indicates the amount paid when drawn under a remittance amount.
3.11.217.2.8 (01-01-2024)
♦Frivolous Arguments♦
Businesses use frivolous arguments for expressing dissatisfaction with the substance, form or administration of the tax laws by trying to illegally avoid or reduce tax liabilities. See IRM 25.25.10, Frivolous Return Program, and Exhibit 3.11.217-5, Potential Frivolous Arguments for Examination Review, for a list of recognized frivolous arguments made by businesses.
Review the return to decide whether it appears to be a frivolous return.
If... Then... The return meets any of the conditions shown as a frivolous return. See Exhibit 3.11.217-5, Potential Frivolous Arguments for Examination Review. ### Exception: If the return shows Action Code 331 and has a Form 4227, Intra-SC Reject or Routing Slip, attached with the remarks, "Refer to Exam FRP for audit after processing" , continue to next procedure. Remove return from the batch and place the return in the locally designated basket for Examination, Frivolous Return Program (FRP) for review. Examination has selected the return as frivolous, shown by an Action Code 331 and a Form 4227, Intra-SC Reject or Routing Slip, with the remarks, "Refer to Exam FRP for audit after processing" , but sends the return for processing. Continue processing the return using procedures in IRM 3.11.217, Form 1120-S Corporation Income Tax Returns. However, do not circle or void the Action Code showing a frivolous return. Do not consider the following returns as frivolous, unless there is other evidence of a frivolous argument:
Returns that have only zeros, blanks, or no entries.
Returns showing "None" , "Not Liable" , etc.
3.11.217.2.9 (01-01-2016)
♦Foreign Currency♦
- For returns completed in other than U.S. currency, process as filed. However, if corresponding for missing/incomplete item(s), include in the letter to resubmit in U.S. currency.
3.11.217.2.10 (01-01-2022)
♦Protective Claims♦
Remove returns marked as "Protective Claim" , "Protective Refund" , "Protective Claim for Refund" , or similar statement from the batch and route to Accounts Management. Notate "Protective Claim" in the remarks box of Form 4227, Intra-SC Reject or Routing Slip.
Exception:
If the return is amended, do not remove from batch. Edit Computer Condition Code "G" and follow normal processing procedures.
3.11.217.2.11 (03-27-2024)
Section 965 Returns (201712 through 202012)
Section 14103 of the Tax Cuts and Jobs Act (TCJA) of 2017 overhauled Section 965 of the Internal Revenue Code. As a result of Section 965, now titled "Treatment of deferred foreign income upon transition to participation exemption system of taxation" , US shareholders must pay a transition tax on the untaxed foreign earnings of certain specified foreign corporations as if those earnings had been repatriated to the United States.
Identify a Section 965 return when the tax period is 201712 through 202012 and any of the following are present:
"Section 965" or "965 Tax" (or similar language) notated on the return, schedules, attachments, or, statements.
IRC 965 Transition Tax Statement (or similar 965 statement) is attached.
Form 965, Inclusion of Deferred Foreign Income Upon Transition to Participation Exemption System, is attached.
Form 965, Schedule A, U.S. Shareholder’s Section 965(a) Inclusion Amount, is attached.
Form 965, Schedule B, Deferred Foreign Income Corporation’s Earnings and Profits (E&P), is attached.
Form 965, Schedule C, U.S. Shareholder’s Aggregate Foreign Earnings and Profits Deficit, is attached.
Form 965, Schedule D, U.S. Shareholder’s Aggregate Foreign Cash Position, is attached.
Form 965, Schedule E, U.S. Shareholder’s Aggregate Foreign Cash Position - Detail, is attached.
Form 965, Schedule F, Foreign Taxes Deemed Paid by Domestic Corporation, is attached.
Form 965, Schedule G, Foreign Taxes Deemed Paid by Domestic Corporation for U.S. Shareholder Tax Year Ending in 2017, is attached.
Form 965, Schedule H, Disallowance of Foreign Tax Credit and Amounts Reported on Forms 1116 and 1118, is attached. Before 2019, the title was Form 965, Schedule H, Amounts Reported on Forms 1116 and 1118 and Disallowed Foreign Taxes.
Form 965-B, Corporate and Real Estate Investment Trust (REIT) Report of Net 965 Tax Liability and Electing REIT Report of 965 Amounts, is attached.
Form 1120-S, Schedule K, Line 10, Other income (loss), shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions). See IRM 3.11.217.24.3, Schedule K, Line 10 – Other income (loss), for more information.
Form 1120-S, Schedule K, Line 12d, Other deductions, shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions). See IRM 3.11.217.24.4, Schedule K, Line 12d, Other deductions, for more information.
Form 1120-S, Schedule K, Line 14r, Other foreign tax information, shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions). See IRM 3.11.217.24.11, Schedule K, Line 14r - other foreign tax information, for more information.
Form 1120-S, Schedule K, Line 17d, Other items and amounts, shows a significant entry with the notation "Section 965" or similar language. See IRM 3.11.217.24.13, Schedule K, Line 17d - Other items and amounts, for more information.
Note:
A significant entry is defined as any amount other than zero.
When a return is identified as a Section 965 return, edit as follows:
Completely edit the return.
Edit CCC "J" . See IRM 3.11.217.14.7, CCC "J" - Section 965 Tax.
Edit Action Code 460 (Management Suspense). See IRM 3.11.217.3.1, Action Codes.
Do not correspond on the return. ERS will take care of any correspondence needed.
Caution:
Notate "K-1 Missing" (or similar language) in the lower left margin (Action Trail) of the return, if correspondence is needed for missing Schedules K-1.
3.11.217.2.12 (01-01-2025)
Elective or Deemed Payment Election (DPE) and Credit Transfers
Under the Inflation Reduction Act (IRA) of 2022 and CHIPS and Science Act of 2022, the S-Corporation can elect to:
Take certain credits as an "Elective or Deemed Payment" .
Transfer a credit to another taxpayer.
Claim the credit as a General Business Credit.
For tax periods 202201 - 202212, identify an "Elective or Deemed Payment Election" when the taxpayer writes "IRA22DPE" on Form 1120-S line 23d dotted portion (prior year form revisions),or line 24d (year 2023 revision and subsequent) or on an attachment.
When a return is identified with an "Elective or Deemed Payment Election" , do the following:
Completely edit the return.
Edit RPC "J" .
Place a flag at the top of the return and attach the "IRA22 DPE/TRE Reminder" sheet to the return.
Note:
P&A will provide the pre-printed half-sheets for C&E to use.
Give the return to the lead.
The lead will have the returns re-batched with "DPE" in the batch ID.
For tax periods 202201 - 202212, identify a "Credit Transfer" when the taxpayer writes "IRA22TRE" on Form 1120-S line 23d (prior year form revisions),or line 24d (year 2023 and subsequent) dotted portion or on an attachment. When found, do the following:
Completely edit the return.
Edit RPC "K" .
Place a flag at the top of the return and attach the "IRA22 DPE/TRE Reminder" sheet to the return.
Note:
P&A will provide the pre-printed half-sheets for C&E to use.
Give the return to the lead.
The lead will have the returns re-batched with "TRE" in the batch ID.
Note:
A return can have both an RPC "J" and an RPC "K" .
3.11.217.2.13 (01-01-2026)
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3.11.217.3 (01-01-2025)
Unprocessable Documents - Error Resolution System
The Document Perfection tax examiner will have the first opportunity to identify a return requiring correspondence, research, or other action to make the return processable. An Action Code is edited to identify these unprocessable returns.
A return must have specific items before it is considered processable. Perfect all documents to the extent possible from schedules and other attachments. The specific items needed are:
An Employer Identification Number (EIN),
A legible name (for name control),
Valid tax period,
Legible tax data, if tax liability is shown, and
A signature attesting to the perjury statement Jurat shown the document.
Conditions which make a return unprocessable are:
Name so illegible or incomplete that the name control cannot be decided.
The EIN or Taxpayer Identification Number (TIN) is other than nine numeric digits and cannot be perfected from information on the return or attachments.
The document has two or more different EIN's.
Taxpayer has stated that he/she has combined liability for more than one tax period or more than one type of tax.
Tax data entries are so incomplete, illegible or contradictory that the tax liability cannot be decided.
The return is mis-blocked.
The return is unsigned.
The return has only entity data and no other statements, attachments from the taxpayer.
Any condition set forth as unprocessable in the sections and subsections on processing specific documents.
If a return has no entity data, or the signature on the return is illegible and the alpha letter of the last name cannot be decided, and the only entries are money amounts, then give the return to the manager.
Returns that cannot be perfected from schedules and other attachments and necessary data was not gotten through research, follow the guidance to reject the return. If you cannot correspond or send the return back to the taxpayer because of illegible entity data, consider the return unprocessable. See IRM 3.11.217.3.3(3) to determine the action needed for unnumbered and numbered returns.
If a 1120-S is received with a second Form 1120-S attached and the second return has the same EIN, Tax Period, and money amounts:
Leave the second return attached to the first.
"X" the first page of the second return and treat as an attachment to the first return.
Exception:
Do not "X" if an amended return. Detach amended return and process separately. The amended return will show on IDRS as a duplicate and be worked by Accounts Management.
The tax examiner decides the kind of action required and assigns an Action Code to the return which will force it to the Error Resolution System (ERS) (on-line correction system). The code indicates whether correspondence, research, or other action is needed.
3.11.217.3.1 (01-01-2026)
Action Codes
Action Codes are used to show whether correspondence, research, or other action is needed. The Action Code sets the suspense period for the return and places the return in the workable or unworkable suspense inventory.
When necessary, assign a three-digit Action Code.
Edit the Action Code in the bottom left margin of the return.
Caution:
Do not edit (or write) over another area's edit marks or action trail.
Assign Action Codes in the following priority:
Action Code 310 (Statute Control)
Action Code 320 (Entity Control)
Action Code 4XX
Action Code 6XX
Action Code 3XX
Action Code 2XX (Correspondence)
Use the following table if more than one Action Code is needed on Form 1120-S, :
If... Then... Action Codes include 211, 215, 225, or 226 and Action Code 341, 1. Edit the Action Code 211, 215, 225, or 226 on the Form 1120-S, U.S. Income Tax Return for an S Corporation. 2. Edit Action Code 341 on the Form 4227, Intra-SC Reject or Routing Slip. Action Codes have the same priority, 1. Edit the Action Code with the shorter suspense period on the Form 1120-S. 2. Edit the second Action Code on the Form 4227, Intra-SC Reject or Routing Slip. 3. See IRM 3.11.217.3.1(7) for suspense periods. Action Codes have different priority, 1. Edit the Action Code with the higher priority on the Form 1120-S. ### Exception: Use Action Code 211, 215, 225, or 226 before Action Code 341 to make sure the return is complete before a manual refund is issued. 2. Edit the second Action Code on the Form 4227, Intra-SC Reject or Routing Slip. 3. See Figure 3.11.217-1, Example of Editing Return When More Than One Action Code is Needed. Figure 3.11.217-1
This is an example of a current year Form 1120-S (Page 1 only) with a missing signature and a completed Form 4227, Intra-SC Reject or Routing Slip. The taxpayer wrote “Filed Pursuant to Rev. Proc. 2013-30” at the top of the Form 1120-S.Form 1120-S, Page 1, Current year returnTop left corner of Form 1120-S reads: DRAFTBox B shows 712100 for the Business Activity CodeBox D shows 00-8764901 for the Employer Identification Number (EIN)Box E shows 4-1-77, for the date incorporatedASPEN MUSEUM is shown on the name line and ASPE is underlined as the name control2502 BALSAM AVE is shown for the street address lineWASHINGTON, DC 20013 is shown for the city, state and ZIP code lineBox I shows 1 for the Number of Shareholders during any part of the tax yearLine 1a, Gross receipts or sales, shows $1,565Line 1c, Balance, shows $1,565Line 3, Gross profit, shows $1,565Line 4, Net gain (loss), shows $100Line 5, Other income (loss) $500Line 6, Total income (loss) shows $2,165Line 10 shows $750Line 17 shows $1,215Line 20 shows $1,965Line 21 shows $200Action Code 347 (Entity) is edited in the bottom left margin of the Form 1120-SForm 4227, Intra-SC Reject or Routing Slip, Boxes: Name-Unit box: 924. Date box reads 031726. Route to box: BMF has an “X” mark in it. Action Code box has an “X” mark. Action Code 225 (Signature) is edited in the Action Code box.
Continue perfecting the return after editing the Action Codes.
Valid Action Codes are listed below:
Action Code Description Additional Information Workday Suspense Period 211 First Taxpayer Correspondence * Return is illegible, incomplete, or contradictory and therefore unprocessable. * The taxpayer notates on the return or attachment that they are reporting tax for more than one tax period or for more than one type of tax. 40 212 Second Correspondence 25 215 International Correspondence * Return is illegible, incomplete, or contradictory and therefore unprocessable. * The taxpayer notates on the return or attachment that they are reporting tax for more than one tax period or for more than one type of tax. 45 225 Taxpayer Correspondence (Signature Only) Unsigned returns (only issue for correspondence). 40 226 International Correspondence (Signature Only) Unsigned foreign returns (only issue for correspondence). 40 310 Statute Control 10 320 Entity Control 10 331 Frivolous Review 3 341 Manual Refund 10 342 Credit Verification 10 343 Other Accounting ### Note: This Action Code is also used for "Black Liquor" claims on Form 6478, Biofuel Producer Credit (Credit for Alcohol Used as Fuel for 2012 - 2007). See "IRM 3.11.217.24.7, " Schedule K, Line 13f, - Biofuel Producer Credit. 10 347 Form 2553, Election by a Small Business Corporation, attached to Form 1120-S, U.S. Income Tax Return for an S Corporation, and/or taxpayer indicates "Revenue Procedure (Rev. Proc.) 2013-30" (effective September 3, 2013) or "Rev. Proc. 2007-62" on Form 1120-S. ### Note: Action Code 347 is used to route Form 1120-S to Entity Control for review of the Form 2553 or Rev. Proc. 2013-30 or Rev. Proc. 2007-62. ### Exception: Do not edit Action Code 347 if the return already has an action trail from Entity Control showing that they have worked it. 20 352 Name Research 3 360 Other-in-House Research 10 370 Examination - Prompt Assessment - Form 4810, Request for Prompt Assessment Under Internal Revenue Code Section 6501(d) 10 420 Management Suspense A 5 440 Management Suspense 15 450 Management Suspense ### Note: Used to send the return to ERS Rejects Function and/or LB&I review for processing of the Elective Payment Election (EPE) and Credit Transfers for processing under the Inflation Reduction Act of 2022. 20 460 Management Suspense ### Note: Used to send the return to ERS Rejects Function for processing of the "Section 965" for Tax Period 201712 through 202012. Section 965, Treatment of Deferred Foreign Income upon Transition to Participation Exemption System of Taxation (Tax Period 201712 through 202012). 25 480 Early Filed Suspense Early filed return. 150 610 Renumber - Non-Remittance * Mis-batched return (e.g., Form 1065 is found in a Form 1120-S batch of work). 0 611 Renumber - Remittance * Mis-batched return (e.g., Form 1065 is found in a Form 1120-S batch of work). 0 650 International * An International return, processed in Ogden Submission Processing Campus (OSPC). 0 Reminder:
Beginning with tax returns for periods ending 12-31-2007 and later, Form 2553, Election by a Small Business Corporation, may be filed as an attachment to Form 1120-S requesting to be considered an S Corporation. Edit Action Code (AC) 347 when a Form 2553 is attached to Form 1120-S or taxpayer shows "Revenue Procedure (Rev. Proc.) 2013-30" or "Rev. Proc. 2007-62" on Form 1120-S.
For more information and applicable Action Codes, see IRM 3.12.38.3.4, Error Resolution System (ERS) Action Codes, and the exhibit in IRM 3.12.38-1, Action Codes.
3.11.217.3.2 (01-01-2024)
Unprocessable Conditions and Rejection of Documents
A tax return is an Ogden Submission Processing Campus (OSPC) only return if at least one of the following conditions exists:
The tax return has a foreign address.
There is a refund credit claimed because of U.S. income tax paid or withheld at source because of the Foreign Investors in Real Property Tax Act whether or not Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property Interests, is attached.
3.11.217.3.3 (01-01-2024)
Treatment of All Unprocessable Tax Returns
Kansas City Submission Processing Campus (KCSPC) - If the Form 1120-S, U.S. Income Tax Return for an S Corporation, is an OSPC only return:
Discontinue perfection of the return.
Prepare Letter 86C, Referring Taxpayer Inquiry/Forms to Another Office, to inform the taxpayer the IRS sent the return to Ogden Submission Processing Campus (OSPC).
Edit an Action Trail (e.g., "86C Sent" or similar language) in the lower left corner going vertically up the side of the return.
If the Form 1120-S is other than an "OSPC only" return, perfect the return.
Examine schedules and other attachments for necessary information and edit the return as needed for processing.
If perfection is not possible, perfect to the extent possible and proceed as set forth in (3) below.
Action to Secure Perfection:
Where shown, prepare Form 4227, Intra-SC Reject or Routing Slip, indicating the reason for rejecting the document and that the taxpayer needs to resubmit for processing when it is perfected.
Attach the Form 4227, Intra-SC Reject or Routing Slip, below the entity area.
If the tax return is not numbered, withdraw it from processing and forward it to the proper area.
If the tax return is numbered, edit the proper Action Code in the bottom left margin of the return and leave it in the block.
3.11.217.3.4 (01-01-2018)
♦Correspondence♦
There are two types of correspondence that Code and Edit may encounter:
Correspondence received from taxpayers, and
Correspondence issued to taxpayers.
3.11.217.3.4.1 (01-01-2022)
♦Definition of Correspondence from Taxpayers♦
Correspondence is all written communications from a taxpayer or a taxpayer’s representative, excluding tax returns, whether solicited or unsolicited. This includes:
Written communications in response to the IRS requests for information or data.
Written communications, including annotated notice responses that provide more information or dispute a notice.
A telephone call that results in a written referral or research (Form e-4442, Inquiry Referral).
The key to identifying taxpayer’s correspondence is to ask the following questions:
Is the taxpayer waiting for a response from the IRS?
Is the taxpayer waiting for the IRS to take action?
Is the taxpayer asking a question?
Note:
A Post-It-Note, Sticky Note, or some other type of note stuck on the return by another function, "Taxpayer (TP) requests penalties be waived" , does not constitute correspondence from the taxpayer.
3.11.217.3.4.2 (01-01-2025)
♦Issuing Correspondence♦
Issue correspondence to resolve any conditions causing the return to be unworkable or unprocessable.
Exception:
Section 965 Returns - Do not correspond on the return. ERS will take care of any correspondence needed. Notate "K-1 Missing" (or similar language) in the lower left margin (Action Trail) of the return, if correspondence is needed for missing Schedules K-1. See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information.
Exception:
Do not correspond on returns prepared by Collections, IRC 6020(b), or by Examination, "Substitute for Return" (SFR).
If the return is incomplete and does not appear to be a return meant for filing or is a conduit for providing information (e.g., indicates "payment only" ), give the return to the lead. The lead must determine the correct course of action. The lead research for a Transaction Code (TC) 150 and any other information necessary to determine if the return will continue processing, is an amended return, or must be routed to another function. An incomplete return could include any of the following:
A one-page return, with or without a signature.
Incomplete returns indicating "Payment Only."
Incomplete returns indicating they have previously e-filed.
Note:
This list is not all-inclusive. Tax examiners may see other unusual documents not addressed in this subsection or in other areas of the IRM.
Examine the return for all unprocessable conditions before initiating correspondence.
If... And... Then... The return needs correspondence, Requires a response, 1. Complete an approved Correspondence Action Sheet indicating the letter number (e.g., 86C, 118C, 319C, etc.), Master File Tax (MFT), and the proper paragraphs. ### Note: Some paragraphs will require fill-ins to enter, such as tax period, form number, Document Locator Number (DLN), etc. 2. Attach the approved Correspondence Action Sheet to the front of the return below the entity area. 3. Edit Action Code 211 (First Correspondence) or 215 (International Correspondence) on the return. 4. Finish editing the return and leave in the batch. The return needs correspondence, Does not require a response, 1. Complete an approved Correspondence Action Sheet indicating the letter number (e.g., 86C, 118C, 319C, etc.), Master File Tax (MFT), and the proper paragraphs. ### Note: Some paragraphs will require fill-ins to enter, such as tax period, form number, DLN, etc. 2. Photocopy first page of return and attach the approved Correspondence Action Sheet below the entity area on the front of the return copy. Be sure the name and address clearly show above the approved Correspondence Action Sheet. 3. Forward the copy to the Correspondence Area. 4. Edit an Action Trail (e.g., 1382C Sent or similar language) in the lower left corner going vertically up the side of the return. 5. Finish editing the return and leave in the batch. Note:
There are more campus exclusive letters. They are for processing specific forms or conditions. Go to the lead or manager for copies of these letters.
3.11.217.3.4.3 (01-13-2023)
♦Correspondence Imaging Inventory (CII) Returns♦
Correspondence Imaging Inventory (CII) is an inventory system for scanning all Accounts Management (AM) receipts into digital images and working the cases from those images.
Note:
Correspondence Imaging System (CIS) changed to Correspondence Imaging Inventory (CII).
"CII" returns show a "CII Image - Do not correspond for Signature" stamp below the signature line or a "CII" annotation on the front of the return.
Verify all edit marks and make sure placement is correct on a "CII" return.
If... Then... The edit marks are black, Underline the edit mark if correct or circle if incorrect. The edit marks are red or green, Circle if incorrect. The edit marks are missing or incorrect, Perfect, as necessary. Follow the instructions below for processing "CII" returns.
If... And... Then... The "CII" return has a Form 13596, Reprocessing Returns, attached, The return is incomplete (e.g., missing signature, schedules, or forms), 1. Do not correspond. 2. Remove the return from the batch and route to Accounts Management (AM). 3. If the return comes back from AM with the information still incomplete, send the return to AM again to secure all the missing information. Indicate "Additional information needed to process incomplete CII return," or similar language on Form 4227 (or other proper routing slip). The "CII" return has a Form 13596, Reprocessing Returns, attached and the return is incomplete (e.g., missing signature, schedules, or forms), The return shows correspondence was sent (e.g., CCC "3" is edited on the return), Do not route the return to Accounts Management (AM). Continue processing the return. The "CII" return does not have a Form 13596, Reprocessing Returns, attached, The return is incomplete (e.g., missing signature, schedules, or forms), Follow normal correspondence procedures.
3.11.217.3.4.4 (01-01-2022)
♦Internal Revenue Service (IRS) Employee Contacts♦
The Internal Revenue Service (IRS) Restructuring and Reform Act of 1998 (RRA 98), Section 3705(a), gives identification requirements for all IRS employees working tax-related matters.
All IRS employees who communicate by telephone, or face-to-face, or any other method of correspondence with taxpayers or their personal representatives, on tax-related matters must give (at minimum) the following information:
Telephone Contact - Their title (e.g., Mr., Mrs., Ms., Miss), last name, and badge identification (ID Card) number. Toll-free employees may also give their location for identification purposes. Treat faxes to taxpayers on tax-related matters as correspondence and include the required information.
Face-to-Face Contact - Their title (e.g., Mr., Mrs., Ms., Miss), give as proper during the conversation, their last name, and badge identification (ID Card) number.
Correspondence (sent to the taxpayer and authorized representatives) - A telephone number that taxpayers can call for answers to questions. In addition, manually generated correspondence must have the employee’s title (e.g., Mr., Mrs., Ms., Miss), last name, Integrated Data Retrieval System (IDRS) number, and letter system number, which are systemically generated by IDRS. Treat faxes to taxpayers on tax-related matters as correspondence and include the required information.
Correspondex letters - Specific employee name and telephone number if the employee initiating the correspondence is in the best position to respond to any questions the taxpayer may have or if the taxpayer is being asked to give more case-related information. If the taxpayer does not need to contact a specific employee, the correspondence needs only an IRS telephone number and standard signature.
When a taxpayer requests to speak with a specific employee who previously worked their inquiry or request, or complains about the level of service previously given, make every effort to resolve the taxpayer's inquiry. If unable to resolve the issue, refer the inquiry using established procedures to the manager.
Secretaries, receptionists, or other people who answer the telephone in functional offices need to identify themselves and will give their badge identification (ID Card) number only if they are answering telephones which are routinely used to give tax or account information.
It is not necessary to repeat the badge identification (ID Card) number on a subsequent contact, when the nature of an employee's work involves multiple contacts with the same taxpayer and the employee has given the taxpayer (either telephone or in-person) their badge identification (ID Card) number on the first contact.
3.11.217.3.4.5 (01-01-2023)
♦Use of Fax for Taxpayer Submissions♦
Taxpayers may send tax return information via fax as part of return perfection even when submitting a signature. In circumstances where contact with the taxpayer was made and documented, faxed signatures are acceptable.
Contact the taxpayer by telephone or correspondence. Follow local procedures to decide which method of contact to use.
Indicate the fax paragraph on the approved Correspondence Action Sheet to inform the taxpayer of the fax options.
Use the following resources to make sure you are speaking with the taxpayer or authorized representative before disclosing any tax information:
IRM 21.1.3.2.3, Required Taxpayer Authentication
IRM 21.1.3.2.4, Additional Taxpayer Authentication
Before leaving any messages on a taxpayer's answering machine, review:
IRM 10.5.1.6.7.2, Answering Machine or Voicemail
IRM 10.8.1, Information Technology (IT) Security, Policy and Guidance
3.11.217.3.5 (01-01-2025)
C/SC Letters
Listed below are letters which are provided by Headquarters for Submission Processing Campus use in corresponding for items listed in this IRM. It is expected that tax examiners or their supervisors (or delegates) will have access to and be familiar with the Submission Processing Center Correspondex for selection of proper letters. The list is not all-inclusive.
Letter 86C, Referring Taxpayer Inquiry/Forms to Another Office - Letter referring taxpayer inquiry/forms to another office.
Letter 118C, Corporate Return Incomplete for Processing: Form 1120, Form 1120 Series, Form 1120-S - Letter requesting missing schedules or documents.
Letter 319C, Return Covers Other Than 12-Month Accounting Period - Letter advising the taxpayer that the IRS can’t process return because it shows an improper tax period, or a period of more than 12 months, or a period less than 12 months without an explanation.
Letter 1382C, Penalty Removal Request Incomplete - Letter requesting taxpayer to resubmit request for penalty relief after receiving notice of penalty assessment.
Letter 3463C, Missing Information Request to Process Business Returns - Letter requesting missing information to process business returns.
3.11.217.3.6 (01-01-2022)
♦Compliance Secured/Prepared Returns♦
Compliance functions (Collections and Examination) secure returns from the taxpayer and prepare returns if the taxpayer does not provide them.
Compliance notates:
Prepared tax returns with "6020(b)" or "SFR" (Substitute for Return).
Secured tax returns with "TC 59X" or "ICS" or "Process as Original" with a Form 13133, Expedite Processing Cycle, attached with the "Delinquent Return" box checked.
Note:
If "RD" (Return Delinquency) is notated on the front of the return and not circled, remove from the batch and route to Collections.
3.11.217.3.6.1 (01-01-2025)
♦IRC 6020(b) Prepared by Collections♦
When the taxpayer does not file a required return, IRC 6020(b) is the authority for the IRS to prepare the return.
These returns are identified by the notation: "PREPARED AND SIGNED UNDER AUTHORITY OF SECTION 6020(b) OF THE INTERNAL REVENUE CODE" , which is located in the center bottom of Page 1 of the return.
Returns must have an IRS Received Date. If missing, follow the normal procedures for editing the IRS Received Date. See IRM 3.11.217.7, Received Date.
Compliance Function representatives must sign returns. If not signed, route to Compliance using Form 4227, Intra-SC Reject or Routing Slip.
Note:
Accept revenue officer (RO) typed or electronic signatures as valid signatures on the return.
Do not edit CCC "D" if the Return Due Date is after July 30, 1996 (without regard to extensions) even if the Compliance Function representative notates "DO NOT ASSESS FAILURE TO PAY PENALTY" .
Do not correspond with the taxpayer for unprocessable conditions. If the return is unprocessable, edit CCC "3" and continue processing.
Edit CCC "W" if the IRS Received Date is more than two years and nine months after the Return Due Date. Do not send the return to Statute Control. See IRM 3.11.217.14.15, CCC "W" = "Cleared by Statute" and IRM 3.11.217.3.7, Statute Returns.
3.11.217.3.6.2 (01-01-2022)
♦Collection Secured♦
These returns are identified by the notations: "TC 59X" or "ICS"
Do not edit CCC "G" on these returns.
Use approved Correspondence Action Sheet to correspond for conditions that are unprocessable (e.g., missing signatures, missing schedules, etc.).
Edit CCC "W" if the received date is more than two years and nine months after the Return Due Date. Do not send to Statute Control. See IRM 3.11.217.3.7, Statute Returns.
Reminder:
If there is an indication of penalties require suppression, edit the proper Computer Condition Code(s). See IRM 3.11.217.14, Computer Condition Codes - General, for more information.
3.11.217.3.6.3 (01-01-2017)
♦Examination Prepared♦
These returns are identified by the notation "SFR" or "SUBSTITUTE FOR RETURN" on Page 1.
Return must have a received date. If no received date is present, follow the normal procedures for editing the received date.
Do not correspond with the taxpayer for unprocessable conditions. If the return is unprocessable, edit CCC "3" and continue processing the return.
If Form 13133, Expedite Processing Cycle, is attached, edit the Computer Condition Codes that are checked on the form.
Note:
Do not enter CCC "D" unless the Return Due Date (without regard to extensions) is July 30, 1996, or prior, even if the CCC “D” box is checked on Form 13133.
Edit CCC "W" if the received date is more than two years and nine months after the Return Due Date. Do not send to Statute Control. See IRM 3.11.217.3.7, Statute Returns.
3.11.217.3.6.4 (01-01-2022)
♦Examination Secured♦
These returns are identified by the notation "Process as Original" on Page 1 of the return with a Form 13133, Expedite Processing Cycle, attached with the "Delinquent Return" box checked.
Do not edit CCC "G" on these returns.
Use approved Correspondence Action Sheet to correspond for conditions that are unprocessable (e.g., missing signatures, missing schedules, etc.).
Edit the Computer Condition Codes that are checked on Form 13133.
Edit CCC "W" if the received date is more than two years and nine months after the Return Due Date. Do not send to Statute Control. See IRM 3.11.217.3.7, Statute Returns.
Reminder:
If Form 13133 (or something similar) shows penalties require suppression, edit the proper Computer Condition Code(s). Please refer to IRM 3.11.217.14, Computer Condition Codes - General, for more information.
3.11.217.3.7 (01-01-2026)
♦Statute Returns♦
Any return with a received date that is two years and nine months or more after the Return Due Date is a potential Statute Control return.
Route all Statute returns to the Statute Control Unit daily or more often if needed, unless any of the conditions below are present.
If any of the conditions listed below are present, do not route to Statute Control Unit for clearance. Instead, edit CCC "W" and continue processing.
Compliance IRC 6020(b) returns. See IRM 3.11.217.3.6.1, IRC 6020(b) Prepared by Collections.
Secured by Examination/Collections, secured by TEGE, secured by TEGE Employee Plan (EP) Exam.
Returns identified by the notation "Process as Original" on Page 1 of the return with Form 13133, Expedite Processing Cycle, attached with the "Delinquent Return" box checked. See IRM 3.11.217.3.6.4, Examination Secured.
Returns with Transaction Code (TC) 59X or Integrated Collection System "ICS" notated on the face of the return.
Returns showing "substitute returns prepared by Examination (SFR)" in top margin of the return. See IRM 3.11.217.3.6.3, Examination Prepared.
Returns with a stamp indicating a previous clearance by Statute Control within the last 90 days.
Return is a 2021 and prior year original. Due to the COVID-19 pandemic and subsequent Submission Processing (SP) and Accounts Management (AM) site closures, SP and AM developed procedures to bypass AM statute clearance and be processed. In addition, any 2022 and prior year returns previously cleared by AM statute will not be returned by SP to AM to be cleared again if the 90-calendar day statute stamp has expired.
If a return has any of the following computer paragraphs (CPs) or letters attached, do not route to Statute Control Unit for clearance. Edit CCC "W" if the return needs processing. See Exhibit 3.11.217-3, Routing Guide for Attachments, for more information.
CP 259, Master File Generated 1st TDI Notice.
CP 959, Master File Generated 1st TDI Notice (Spanish version).
CP 518, Final Notice - Return Delinquency.
Letter 112C, Payment/Overpayment/Credit Applied; No Record of Return Filed.
Letter 282C, Return Not Received: Copy Requested/Received.
Letter 2255C, Delinquent Return (Forms 720, 1041, 1065, 1120).
Letter 2284C, Delinquent Return (Form 940, 941, 942, 943).
If a return has a Form 12412, Operations Assistance Request (OAR), from TAS and is a potential statute control return but is not stamped "Cleared by Statute" , give it to lead. The lead contacts the TAS employee listed on the OAR for rejection of the return and sends it back to TAS for clearance by the Statute Control Unit.
Note:
If the return’s received date is within 90 days of the statute expiration date, advise the TAS employee of such and route the return directly to Statute Control for clearance.
Statute returns are unprocessable until cleared by Statute Control.
If... Then... The return is numbered, 1. Edit Action Code 310 on the return. 2. Leave the return in the batch and continue processing the return. The return is unnumbered, 1. Do not continue processing the return. 2. Pull the return from the batch. 3. Attach Form 4227, Intra-SC Reject or Routing Slip, and route to Statute Control Unit. Edit CCC "W" if the Statute Control Unit stamps or shows clearance on the front of the return. Exhibit 3.11.217-2, Due Date Chart.
Statute stamps "No Statute Issue" or shows clearance on the front of the return. Follow the chart below to determine if a CCC "W" is needed:
If... And... Then... The return received date is two years and nine months or more after the Return Due Date, The return is stamped, "No Statute Issue" or a similar statement indicating there is no statute issue (e.g., "Statute N/A" ), Edit CCC "W" . The return received date is less than two years and nine months from the Return Due Date, The return is stamped, "No Statute Issue" or a similar statement indicating there is no statute issue (e.g., "Statute N/A" ), Do not edit CCC "W" .
3.11.217.3.8 (01-01-2025)
♦Re-Entry Document Procedures♦
Reprocess a return posted to the wrong account or module to post it to the correct account module.
Some re-entry returns will have originally been filed electronically through Modernized E-file (MeF). These returns may be identified by the presence of MeF printouts in lieu of an actual return. Do not correspond for missing signatures on these documents.
Each re-entry return must have a Form 3893, Re-Entry Document Control, or Form 13596, Reprocessing Returns, attached.
Form 3893 is used to re-input documents that have not posted to an account or module.
Form 13596 is used to reprocess documents to the correct account or module that had previously posted to the wrong account or module.
Always leave the Form 3893 or Form 13596 on the front of the return. It must remain as a permanent part of the document.
Examine Form 3893 or Form 13596 to determine the action needed to make the return processable.
Caution:
If the received date is two years and nine months or more after the Return Due Date, refer to Statute procedures before re-entering or reprocessing the return. See IRM 3.11.217.3.7, Statute Returns.
3.11.217.3.8.1 (01-01-2025)
♦Form 3893 - Re-Entry Document Control♦
Form 3893, Re-Entry Document Control, is used to re-input a return that has not posted to an account or module.
If more than one return is in the batch and only the top Form 3893 has an entry in Box 1 (Alpha/Numeric block control no.), edit all returns using current processing instructions and keep all returns clipped together.
Circle CCC "G" if present.
Do not edit CCC "G" on Amended returns.
Do not send Letter 1382C, Penalty Removal Request Incomplete, if a request for penalty relief is attached.
If the return is not edited according to current processing instructions, circle any Action Codes, Computer Condition Codes, and any other edit marks that are no longer applicable. Re-edit according to current processing instructions.
If the return is edited according to current processing instructions, make sure that the information from Form 3893 is edited to the return.
Form 3893 Action Taken Box 14 (Remarks) Make sure that the information is edited to the return. Box 15 (Process as) 1. Circle any green rocker and edit marks that show a receipt of remittance. 2. Do not change any Tax Due amounts. Examine returns that have any color other than red editing in the tax data section to determine if the corrections are the result of improper perfection or taxpayer error.
If... Then... Improper perfection, Edit the same correction in red/green (per local procedure) to the proper area. Taxpayer error, Leave the entries as shown on the document. A received date must be present on all Re-input returns.
If... Then... The IRS Received date is not present, Edit an IRS Received Date to the middle of the return. See IRM 3.11.217.7, Received Date. Multiple IRS Received Dates present, Circle all but the earliest date. When more information is needed to make the return processable, prepare approved Correspondence Action Sheet or Form 4227, Intra-SC Reject or Routing Slip, for the proper action (e.g., correspondence, research, etc.).
Exception:
Do not correspond for missing Schedules K-1, Shareholder's Share of Income, Deduction, Credits, etc.
When perfection is not possible, edit Action Code 640 on the return and attach Form 4227, Intra-SC Reject or Routing Slip, noting "Perfection not Possible" and leave in batch.
3.11.217.3.8.2 (01-01-2025)
♦Form 13596 - Reprocessing Returns♦
Form 13596, Reprocessing Returns, is used to reprocess a return to the correct account or module that had previously posted to the wrong account or module.
Circle CCC "G" if present.
Do not edit CCC "G" on Amended returns.
Do not send Letter 1382C, Penalty Removal Request Incomplete, if a request for penalty relief is attached.
If the return is not edited according to current processing instructions, circle any Action Codes, Computer Condition Codes, and any other edit marks that are no longer applicable. Re-edit according to current processing instructions.
Caution:
If you receive a Form 1120-S, U.S. Income Tax Return for an S Corporation, converted from Form 1120, U.S. Corporation Income Tax Return, make sure that the following items are present: EIN, Name Control, NAICS, Received Date, Audit Code "4" , tax period (prior year returns), CCC "3" (if applicable for "No Replies" ), and CCC "F" (if applicable for Final returns). If not, then edit the needed items. Do not detach Form 1120. See IRM 3.11.217.4.2, Issuing Correspondence, for more information.
If the return is edited according to current processing instructions, make sure that the information from Form 13596 is edited on the return.
Form 13596 Action Taken Taxpayer Identification Number (TIN) correction, Edit the correct TIN on return. Tax period correction, Edit the correct tax period ending on the return. Reasonable cause, Edit proper Computer Condition Code(s). 1. Edit CCC "R" if the Failure to File "FTF" box is checked. 2. Edit CCC "D" if the Failure to Pay "FTP" box is checked. Examine returns that have any color other than red editing in the tax data section to determine if the corrections are the result of improper perfection or taxpayer error.
If... Then... Improper perfection, Edit the same correction in red/green (per local procedure) to the proper area. Taxpayer error, Leave the entries as shown on the document. A received date must be present on all reprocessed returns.
If... Then... Received date is not present, Edit a received date to the middle of the return. See IRM 3.11.217.7, Received Date. Multiple received dates are present, Circle all but the earliest date. Circle any green rocker and edit marks that show a receipt of remittance.
When more information is needed to make the return processable, prepare approved Correspondence Action Sheet or Form 4227, Intra-SC Reject or Routing Slip, for the proper action (e.g., correspondence, research, etc.).
Exception:
Do not correspond on CII returns, instead route to AM. See IRM 3.11.217.3.4.3(4), Correspondence Imaging Inventory (CII) Returns, for processing instructions.
Exception:
Do not correspond for missing Schedules K-1, Shareholder's Share of Income, Deduction, Credits, etc.
3.11.217.3.9 (08-01-2026)
♦Amended Returns♦
A return is considered amended based on the following:
The Amended box is checked.
Words such as "Supplemental" , "Corrected" , "Superseded" , or "Additional" are present.
Any indication from the taxpayer that a previous return was filed.
Note:
Words such as "Copy" or "Duplicate" are not sufficient indicators and must be accompanied by a statement from the taxpayer that a previous return was filed.
Examine the return for attachments:
Do not separate any related attachments submitted to explain the reason for the Amended Return. Accounts Management may use the information.
Detach any unrelated documents and route them to the correct function using Form 4227, Intra-SC Reject or Routing Slip, and edit the Action Trail on the return.
Note:
Pull any amended Form 1120-S, U.S. Income Tax Return for an S Corporation, with Case Base Reasoning "CBR" notated and route to Accounts Management.
Follow the instructions in the chart below when there is an indication of an amended return:
If... Then... Compliance Services entered "TC 59X" or "ICS" was edited on the return by Compliance Services, Do not edit CCC "G" . Process the return as an original. Statute Control stamped the return "Delinquent Original Cleared for Processing" , Do not edit CCC "G" . Process the return as an original. Form 3893 or Form 13596 is attached, Do not edit CCC "G" . See IRM 3.11.217.3.8.1, Form 3893 - Re-Entry Document Control, and IRM 3.11.217.3.8.2, Form 13596 - Reprocessing Returns. None of the above are present, Edit CCC "G" . No other codes may be used with CCC "G" . ### Exception: CCC "S" , CCC "T" , CCC "W" , CCC "3" and/or Error Resolution System (ERS) Action Codes may be used with CCC "G" . The following data must be edited on all Amended returns:
Name Control - See IRM 3.11.217.5.4, Entity Perfection - Name Control.
Employer Identification Number (EIN) - See IRM 3.11.217.5.3, Entity Perfection - Employer Identification Number (EIN).
Tax Period - See IRM 3.11.217.6, Tax Period.
CCC "G" - See Exception above.
Received Date - See IRM 3.11.217.7, Received Date.
Signature - See IRM 3.11.217.19, Signature.
Note:
No further editing is required.
Detach Schedules K-1 for current year (TY2025), two preceding years (TY2024 and TY2023), and future Schedules K-1. See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedules K-1.
Note:
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
3.11.217.3.10 (01-05-2016)
Prompt Assessment or Prompt Determination - Form 4810
A Prompt Assessment, Internal Revenue Code (IRC) Section 6501 is requested, either in the form of a letter or on Form 4810, Request for Prompt Assessment Under Internal Revenue Code Section 6501(d). A Prompt Determination is requested under Section 505 of the U.S. Bankruptcy Code.
If... And... Then... A Prompt Assessment or Prompt Determination request is not attached to a tax return, Forward the Prompt Assessment/Prompt Determination request to Examination. A Prompt Assessment or Prompt Determination is attached to a tax return, A Transaction Code (TC) 150 has not posted for that return, Process the return and forward the Prompt Assessment/Prompt Determination request to Examination with a copy of the tax return. A Prompt Assessment or Prompt Determination is attached to a tax return, A TC 150 has posted for that return, Route the return and Prompt Assessment/Prompt Determination request to Examination. ### Note: If return is numbered, edit Action Code 370 and continue processing the return.
3.11.217.3.11 (01-01-2026)
♦Refund Returns (45 Day Jeopardy and High Dollar Refunds)♦
Document Perfection identifies refunds in jeopardy and requests manual refunds.
Note:
Expeditious processing of refund returns is critical if the 45-day period is about to expire.
If... Then... A refund return is batched in a non-refund batch, 1. Pull the return from the non-refund batch using local procedures. 2. Code and edit the return as completely as possible. ### Note: Follow the instructions below when the processing date is more than 20 days after the received date or the Return Due Date (2nd If box)*or the refund amount is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡*(3rd If box). The processing date is more than 20 days after the received date or the Return Due Date (whichever is later) and the refund amount is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, ### Note: Refund in this instruction means only the amount requested to be refunded to the taxpayer, not overpayments transferred to other periods. * Unnumbered Returns: 1. Pull the return from the batch. 2. Code and edit the return as completely as possible. 3. Edit Action Code 341. See Figure 3.11.217-2, Example of Editing Action Code 341. 4. Give the return to the manager for expedited processing. * Numbered Returns: 1. Code and edit the return as completely as possible. 2. Edit Action Code 341 and leave in the batch. The refund is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ### Note: Refund in this instruction means only the amount requested to be refunded to the taxpayer, not overpayments transferred to other periods. * Unnumbered Returns: 1. Pull the return from the batch. 2. Code and edit the return as completely as possible. 3. Edit Action Code 341. 4. Make a copy of the first two pages of the return along with any page of the return that appears suspicious for Criminal Investigation (CI). See IRM 3.11.217.2.5, Criminal Investigation (CI) Referral. 5. Edit an action trail "Copy to CI" or "CI Referral" , or similar language in the lower left corner going vertically up the side of the return. 6. Expedite processing. * Numbered Returns: 1. Code and edit the return as completely as possible. 2. Edit Action Code 341. 3. Attach Form 4227, Intra-SC Reject or Routing Slip, to the return, edit Action Code 341 on Form 4227, and leave in batch. 4. Make a copy of the first two pages of the return along with any page of the return that appears suspicious for Criminal Investigation (CI). See IRM 3.11.217.2.5, Criminal Investigation (CI) Referral. 5. Edit an action trail "Copy to CI" or "CI Referral" , or similar language in the lower left corner going vertically up the side of the return. Figure 3.11.217-2
This is an example of a completed Form 1120-S (Page 1 only).Form 1120-S, Page 1, current year returnTop left corner of Form 1120-S reads: DRAFTThere is a text box at the center top of the form that reads: Today’s Date is June 6Box A shows March 30, 2020 for the effective date of the S electionBox B shows 236110 for the Business Activity CodeBox D shows 00-0071904 for the Employer Identification Number (EIN)Box E shows February 21, 2021, for the date incorporated.DJ Willow is shown on the name line and DJWI is underlined as the name control999 Cedar Corner is shown for the street address lineSalt Lake City, UT 84100 is shown for the city, state, and ZIP code lineThere is a 2 edited to the right of Box E for the Initial Return CodeBox I shows 1 for the Number of Shareholders during any part of the tax yearLine 1a, Gross receipts or sales, shows 1,900,000Line 1b, Returns and allowances, shows 1,000,000Line 1c, Balance, shows 900,000Line 3, Gross profit, shows 900,000Line 6, Total income (loss) shows 900,000In the middle of the Form 1120-S is a Received Date Stamp that reads: RECEIVED00105082026OGDEN, UT IRS-OSCLine 7, Compensation of officers, shows 10,000Line 9, Repairs and maintenance, shows 2,000Line 11, Rents, shows 2,000Line 13, Interest, shows 15,000Line 19, Other deductions, shows 5,000Line 20, Total deductions, shows 34,000Line 21, Ordinary business income (loss) shows 866,000Line 23a, Estimated tax payments, shows 168,000Line 23d, Add lines 23a through 23c, shows 168,000Line 26, Overpayment, shows 168,000Line 27, Enter amount from Line 26 Credited to estimated tax, center of line, shows 140,000Line 27, Enter amount from Line 26 Credited to estimated tax, shows 28,000Sign Here box: Signature of officer: Robert MagnoliaSign Here box: Date: 4/25/25Sign Here box: Title: PresidentPaid Preparer Use Only box: Paid Preparer name: Raymond Spruce, signed Raymond Spruce, 4-7-26Firm’s name: Elm Accounting ServiceFirm’s EIN: 00-1645689Firm’s address: 641 Ash Dr. Salt Lake City UT 84100Action Code 341 is edited in the bottom left margin of the form
3.11.217.4 (01-01-2019)
Examination of Tax Data
- This subsection provides instructions for editing general tax data.
3.11.217.4.1 (01-01-2025)
Non-Standard or Prior Year Format
All prior year returns must be reformatted to current year format. Refer to Code and Edit BMF Job Aids for specific year coding.
If the return is on other than current form format (either a prior year or non-standard form) and the transcription lines cannot be numbered to agree with the current year return:
Edit all available transcribed tax data items to the tax data part of a blank current year form.
Place a large "X" across the tax data entries of the prior year (or non-standard) form.
Staple the forms together, attaching the dummied form (current format) on top so that ISRP can enter the entity data from the prior year (or non-standard) form.
3.11.217.4.2 (01-04-2018)
Conversion of Form 1120 to Form 1120-S
If a taxpayer filed Form 1120 and the Entity Control Unpostable Unit has determined the taxpayer has a valid Small Business Election (Form 2553, Election by a Small Business Corporation) on file, Rejects function will convert Form 1120 to a Form 1120-S, U.S. Income Tax Return for an S Corporation. No action is required of Document Perfection. Do not detach Form 1120.
If you receive a Form 1120-S converted from Form 1120 and the Form 13596, Reprocessing Returns, is attached for reprocessing, see IRM 3.11.217.3.8.2, Form 13596 - Reprocessing Returns, for more information.
3.11.217.4.3 (01-01-2016)
Significant Entries
Reference is made throughout this IRM to "significant entries" . A significant entry is defined as any amount other than zero.
Note:
"Blank" , "Dash" , "None" , "N/A" , or "Zero" are not significant entries unless otherwise specified.
3.11.217.4.4 (01-01-2024)
Incomplete Return
When the return serves only as a transmittal for statements, schedules, and other attachments, or is otherwise incomplete, analyze the supporting documents and edit the missing entries on the form itself.
Examine attachments and edit the information to proper transcription lines of both the income and deduction sections.
Edit the income section if Line 6 is the only entry in the income section.
Edit the deduction section if Line 22 (line 21 for prior year form revisions) is the only entry in the deduction section.
Edit the income or deduction sections if blank and there is an indication the income or deduction items are included on an attachment (e.g., a notation such as "See attached" , "See Schedule F" , "Statement attached" , etc.).
Note:
When a doubt exists concerning placement of an income or deduction item because of terminology used by the taxpayer, edit income items as "other income" and deduction items as "other deductions."
Secured Delinquent Returns are returns secured by compliance personnel. If information is missing from one of these returns, do not send the return back to the taxpayer; correspond using approved Correspondence Action Sheet.
3.11.217.4.5 (01-01-2022)
Editing Dollars and Cents
Document Perfection is not required to edit a vertical line, 00, dash, or decimal point to show dollars and cents.
If... Then... The taxpayer has entered money amounts showing dollars and cents separated by a decimal point, No editing is required. The taxpayer has entered dollars only where dollars only must be entered, No editing is required. The taxpayer has entered dollars only where dollars and cents must be entered, No editing is required.
3.11.217.4.6 (01-01-2022)
Negative Entries
Edit negative entries as follows:
If... Then... Brackets "\[ \]" or parentheses "( )" are pre-printed on the form, No editing is required. The taxpayer shows a negative amount with brackets "\[ \]" or parentheses "( )" or a minus "–" sign, No editing is required. Editing a negative amount to a transcription line (e.g., computing a line entry, entering a missing entry, etc.), Bracket "\[ \]" (or "( )" ) the negative amount.
3.11.217.5 (01-01-2019)
♦Entity Perfection♦
- This subsection provides instructions related to taxpayer identification for Form 1120-S, U.S. Income Tax Return for an S Corporation.
3.11.217.5.1 (01-01-2016)
♦Entity Perfection - General♦
The entity of a tax return identifies the taxpayer on the Business Master File (BMF). The entity area of the return contains the following:
Employer Identification Number (EIN)
Name
"In-care-of" Name
Address
3.11.217.5.2 (01-01-2023)
♦Bankruptcy♦
If the Form 1120-S, U.S. Income Tax Return for an S Corporation, shows bankruptcy (e.g., shows "RECEIVER" , "TRUSTEE" , or "DEBTOR IN POSSESSION" ) in the entity area or on an attachment, route to Entity Control. Follow local procedures using Form 13934, Entity Document/C&E Merge Transmittal.
Exception:
Do not route Amended returns to Entity.
Completely edit the return except the name control prior to routing to Entity Control.
Exception:
Do not route to Entity if there is an indication Entity has already edited the return, usually orange/purple editing of the EIN and name control.
3.11.217.5.3 (01-01-2022)
♦Entity Perfection - Employer Identification Number (EIN)♦
The EIN is a nine-digit number (XX-XXXXXXX) assigned to identify the taxpayer.
Determine the EIN as follows:
If... And... Then... EIN is missing, You can determine the correct EIN from the attachments or schedules, Edit the EIN to the proper location. The EIN is either a Practitioner Tax Identification Number (PTIN) or Individual Taxpayer Identification Number (ITIN), Unnumbered/Numbered, * Unnumbered 1. Remove return from batch. 2. Route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal, for EIN assignment. * Numbered 1. Edit Action Code 320. 2. Leave return in batch. Multiple EINs are present, Unnumbered/Numbered, * Unnumbered 1. Remove return from batch. 2. Route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal, for EIN assignment. * Numbered 1. Edit Action Code 320. 2. Leave return in batch. The EIN contains any of the following conditions and can’t be determined from attachments or schedules: * Illegible * Missing * Other than nine digits * All zeros * All nines Unnumbered/Numbered, * Unnumbered 1. Circle out all illegible EINs, zeros, or nines. 2. Research IDRS. 3. If found, edit to the proper location. 4. If not found, route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal. * Numbered 1. Circle out all illegible EINs, zeros, or nines. 2. Edit Action Code 320. 3. Leave return in batch. "Pending" , "applied for" , etc., is shown in the EIN area, Unnumbered/Numbered, * Unnumbered 1. Research Integrated Data Retrieval System (IDRS). 2. If found, edit to the proper location. 3. If not found, route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal. * Numbered 1. Edit Action Code 320. 2. Leave return in batch.
3.11.217.5.4 (01-01-2025)
♦Entity Perfection - Name Control♦
The Name Control consists of four characters or less.
Valid characters are alpha, numeric, ampersand (&), hyphen (-), and blank. However, blanks are only valid in the last three positions.
Disregard the word "The" in the Name Control only when followed by more than one word.
See Job Aid Document 7071-A, Name Control Job Aid - For Use Outside the Entity Area, to determine the Name Control.
If Box H(2) "Name Change" is checked, route the return to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal.
Edit the Name Control as follows:
If... And... Then... Able to determine the Name Control, Underline the Name Control. See Figure 3.11.217-3, Example of Editing a Name Control. Unable to determine the Name Control, Unnumbered/Numbered, * Unnumbered 1. Research Integrated Data Retrieval System (IDRS). 2. If found, edit to the proper location. 3. If not found, route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal. * Numbered 1. Edit Action Code 352 (Name Research). 2. Leave return in batch. Figure 3.11.217-3
This is an example of completed Form 1120-S (Page 1 top part only) with the Name Control edited.Form 1120-S, Page 1, current year returnTop left corner of Form 1120-S reads: DRAFTBox A shows Feb 10, 1981 for the effective date of the S electionBox B shows 446110 for the Business Activity CodeBox D shows 00-1106960 for the Employer Identification Number (EIN)Box E shows February 10, 1981, for the date incorporated.Maple Pharmacy shown on the name line and MAPL is underlined as the name control1213 Hemlock Dr. is shown for the street address lineBuffalo, NY 14240 is shown for the city, state, and ZIP code lineBox F shows 110,200 for Total AssetsBox I shows 1 for the Number of Shareholders during any part of the tax year
3.11.217.5.5 (01-01-2025)
♦Entity Perfection - "In-Care-Of" Name♦
An "in-care-of" name can be identified by the words "in care of" or the symbols "c/o" or "%" (percent).
Make sure the "in-care-of" name is in the proper location.
If... Then... The "in-care-of" name is located on the street address line preceding the street address, No editing is required. The "in-care-of" name is located above the first name line or below the street address, Arrow the "in-care-of" name so it appears below the first name line and above the street address. The "in-care-of" name is shown on an attachment, 1. Edit the "in-care-of" name above the street address beginning with the "%" or "c/o" in the first position. 2. Continue editing the return. The street address for the "in-care-of" name is different from the street address of the S Corporation, 1. Arrow the "in-care-of" street address below the "in-care-of" name or edit the "in-care-of" street address below the "in-care-of" name if located on an attachment. 2. Circle the S Corporation's street address. 3. Notate TC 014 in the upper left margin. 4. Pull the return for research/input of TC 014 by the Code and Edit Research Clerk. ### Note: BMF ISRP is not programmed for a mailing address and a location address. A TC 014 must be input into IDRS to capture both a location address and mailing address. Note:
Always circle out the in-care-of symbol ("%" or "c/o" ) if it is present with an address. Do not use the ampersand (&) and the percent sign (%) when editing address information.
Determine a change in the in-care-of name by any of the following:
A check mark in Box H(2) "Name Change" , or
A check mark in Box H(3) "Address Change" , or
Taxpayer edits or added to the "in-care-of" ” name (e.g., original "in-care-of" name crossed out, new name added, etc.)
If... Then... An "in-care-of" name is changed but there is no sign of an address change, 1. Edit the "in-care-of" name as shown above. 2. Continue editing the return. An "in-care-of" name is present and Box H(3) "Address Change" is checked (or there is a sign of an address change), 1. Edit the "in-care-of" name as shown above. 2. Correct the address. 3. Continue editing the return.
3.11.217.5.6 (01-01-2025)
♦Entity Perfection - Domestic Addresses♦
Perfect the address when the mailing address (Street or P.O. Box) is not easily identified.
Exception:
Do not perfect the address on Amended returns (CCC "G" ).
A business may have two addresses. One is the mailing address, and the other is the location address or physical location of the business.
Note:
BMF ISRP is not programmed for a mailing address and a location address. A TC 014 must be input into IDRS to capture both a location address and mailing address.
Perfect the address as follows:
If... And... Then... An attachment shows the address has been changed, Edit the new address in the entity section of the return. See Figure 3.11.217-4, Example of a Return With a Change of Address. Form 8822, Change of Address, or Form 8822-B, Change of Address or Responsible Party - Business, is attached, All apply: * Mailing address information is the same on Form 1120-S, * Form 8822 or Form 8822-B, Line 7, does not list a location address, * No entry on Form 8822-B, Lines 8 or 9, Take no action. Form 8822, Change of Address, or Form 8822-B, Change of Address or Responsible Party - Business, is attached, Any applies: * Mailing address information is different, * Form 8822 or Form 8822-B, Line 7, lists a location address, * Form 8822-B, Lines 8 or 9, have an entry, Detach Form 8822 or Form 8822-B and route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal. Both a P.O. Box and a street address are shown, 1. Notate Transaction Code "TC 014" in the upper left margin. See Figure 3.11.217-5, Example of a Return With a P.O. Box and Street Address. 2. Pull the return for research/input of TC 014 by the Code and Edit Research Clerk. ### Note: A TC 014 must be input to retain the street address as a location address and the P.O. Box as the mailing address. Two street addresses are shown, 1. Underline the second street address. 2. Notate the "TC 014" in the upper left margin. 3. Pull the return for research/input of TC 014 by the Code and Edit Research Clerk. ### Note: BMF ISRP is not programmed for a mailing address and a location address. A TC 014 must be input into IDRS to capture both a location address and mailing address. One street address is shown, The taxpayer changed the address to a P.O. Box, 1. Notate the "TC 014" in the upper left margin. 2. Pull the return for research/input of TC 014 by the Code and Edit Research Clerk. ### Note: A TC 014 must be input to retain the street address as a location address and the P.O. Box as the mailing address. The city and state are not shown on the return, but are shown on an attachment, Edit the city and state in the entity section of the return. The ZIP Code is missing or illegible, Is not available from the return or attachments, See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries to determine the ZIP Code. ### Note: Edit the three digits followed by "01" of the first ZIP Code listed for the applicable state (e.g., "99501" for Alaska). Only the first three digits of the ZIP Code can be determined, Edit "01" for the fourth and fifth digits. Box H(3) "Change of Address" is checked, An "in-care-of" name is present, 1. Edit the "%" (percent sign) or "c/o" to the left of the "in-care-of name" (in the first position) followed by the correct name. 2. Correct the address. 3. Continue editing the return. It is necessary to edit the street address, See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for current Address/Street Abbreviations. The address contains information other than a street address or P.O. Box, Do not perfect. ISRP will enter the complete address. Note:
Always circle the "in-care-of" symbol ("c/o" or "%" ) if it is present with an address. Do not use the ampersand (&) and the percent symbol (%) when editing address information. See Figure 3.11.217-6, Example of a Return with In-Care-Of on the Address Line.
Figure 3.11.217-4
This is an example of a completed Form 1120-S (Page 1 top part only). An attachment shows an address change. The new address information is edited to the entity area of Form 1120-S.Form 1120-S, Page 1, Entity part, current year returnTop left corner of Form 1120-S reads: DRAFTBox A shows 12-12-92 for the effective date of the S electionBox B shows 523900 for the Business Activity CodeBox D shows 00-0181650 for the Employer Identification Number (EIN)Box E shows 12-12-92 for the date incorporated.Balsam Finance Co is shown on the name line and BALS is underlined as the name control206 Pine Lane is circled out in red and the new address 3501 Chestnut Ave is written in red to the right of the old address on the street address lineSan Jose CA 95101 is circled out in red and the new city Miami, FL 33152 is written in red to the right of the old city for the city, state, and ZIP code lineBox F shows 79,850 for Total AssetsBox H(3): Address change, has an X markAn attachment shows an address change. There is an attachment text box that reads: To whom it may concern: Please change my address to:3501 Chestnut AvenueMiami, FL 33152Thank youSincerely,John CedarJohn Cedar
Please click here for the text description of the image.
Figure 3.11.217-5
This is an example of a completed Form 1120-S (Page 1 top part only). The address line contains a street address and a P.O. Box address. Form 1120-S, Page 1, Entity part, current year returnTop left corner of Form 1120-S reads: DRAFTBox A shows 06-01-88 for the effective date of the S electionBox B shows 481000 for the Business Activity CodeBox D shows 00-1234819 for the Employer Identification Number (EIN)Box E shows 06-01-88 for the date incorporated.Cypress Airlines shown on the name line and CYPR is underlined as the name control21 Alder Drive PO Box 116 is shown for the street address lineDallas TX 75260 is shown for the city, state, and ZIP code lineBox F shows 607,040 for Total AssetsBox I shows 1 for the Number of Shareholders during any part of the tax yearAction Trail TC 014 is edited in the left margin of the return
Please click here for the text description of the image.
Figure 3.11.217-6
This is an example of a completed Form 1120-S (Page 1 top part only). The street address includes a c/o. The Name Control (HICK) is underlined and c/o is circled in red.Form 1120-S, Page 1, Entity part, current year returnTop left corner of Form 1120-S reads: DRAFTBox A shows 01-01-90 for the effective date of the S electionBox B shows 621330 for the Business Activity CodeBox D shows 00-2233456 for the Employer Identification Number (EIN)Box E shows 01-01-90 for the date incorporated.Hickory Evaluations Inc. shown on the name line and HICK is underlined in red as the name controlc/o 244 Aspen Lane is shown for the street address line and c/o is circled out in redSt. Louis, MO 63155 is shown for the city, state, and ZIP code lineBox F shows 310,008 for Total AssetsBox I shows 1 for the Number of Shareholders during any part of the tax year
The U.S. Postal Service established new address requirements for Army Post Office (APO), Diplomatic Post Office (DPO), and Fleet Post Office (FPO) addresses. If the old address appears, convert to the new state code abbreviation based on the ZIP Code (e.g., APO New York, NY 091XX would be converted to APO AE 091XX). Consider APO/DPO/FPO addresses as domestic addresses. Refer to APO/DPO/FPO Conversion Chart below:
Address State Code Abbreviation ZIP Code APO/DPO/FPO AA 340XX APO/DPO/FPO AE 090XX - 098XX APO/DPO/FPO AP 962XX - 966XX
3.11.217.5.7 (01-01-2023)
♦Entity Perfection - Foreign Address (OSPC)♦
A foreign (international) address is any address that is not in the 50 states or the District of Columbia.
Consider returns with Army Post Office (APO), Diplomatic Post Office (DPO), and Fleet Post Office (FPO) addresses as domestic addresses. See IRM 3.11.217.5.6, Entity Perfection - Domestic Addresses.
Route returns with a foreign address to Ogden Submission Processing Campus (OSPC) for processing. Prepare Letter 86C, Referring Taxpayer Inquiry/Forms to Another Office, to inform the taxpayer that the IRS sent the return to Ogden. Edit an Action Trail (e.g., "86C Sent" or similar language) in the lower left corner going vertically up the side of the return.
Consider returns with addresses in the following U.S. Possessions/Territories as foreign for processing purposes. Edit the same way as domestic addresses.
Edit a two-character alpha code for the Possession/Territory name.
U.S. Possession Abbreviation American Samoa AS Federated States of Micronesia FM Guam GU Marshall Islands MH Northern Mariana Islands MP Palau PW Puerto Rico PR Virgin Islands (U.S.) VI A ZIP Code must be present for U.S. Possessions/Territories. Edit the correct ZIP Code if one is not provided. See Exhibit 3.11.217-7, U.S. Possessions ZIP Codes.
All other foreign addresses are edited the same as a domestic address with the following exceptions:
Ensure the foreign country is the last entry in the address.
Circle the foreign country and edit the Country Code preceded by a "/" and followed by "/$" (e.g., "/GM/$" is edited for Germany). See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries, for acceptable Foreign Country Codes.
Edit a unique country code for returns filed with an address in Canada. See IRM 3.11.217.5.7.1, Country Code - Canada.
Note:
Coding and Editing BMF Tax Returns, Foreign Addresses Job Aid (Number 2324-002) provides examples for editing foreign addresses.
If the foreign address is from Australia, Brazil, Canada, Cuba, Italy, Mexico, or The Netherlands, check if the address has a province, state, or territory:
Note:
There may be other countries with provinces, states, and territories not listed above, see Coding and Editing BMF Tax Returns, Foreign Addresses Job Aid (Number 2324-002) for more information.
If... Then... A province, state, or territory name is present, 1. Circle the province, state, or territory name. 2. Enter the correct abbreviation. See Exhibit 3.11.217-6, Province, Foreign State and Territory Abbreviations. A province, state, or territory name is not present, Continue editing the return. A province, state, or territory is shown in abbreviated format, Continue editing the return. A ZIP Code or state is not required on a foreign address. Foreign addresses use a postal code that is entered before the city or foreign country and is part of the address.
3.11.217.5.7.1 (01-01-2023)
♦Country Code - Canada♦
To help Compliance with workload assignment, returns filed with an address in Canada will be edited using a unique Country Code based on the province/territory.
If... Then... The foreign address contains a Canadian Province/Territory name, or abbreviation shown in the table below, 1. See table below to make sure the correct Canadian Province/Territory is present or edited to the return. 2. Circle the country name. 3. Edit the correct Country Code based on the province/territory preceded by a "/" and followed by a "/$" as the last entry in the address. The foreign address does not contain a Canadian Province/Territory name, or abbreviation shown in the table below, 1. Circle the country name. 2. Edit the Country Code "/CA/$" as the last entry in the address. Canadian Province/Territory Abbreviations, Postal Codes, and Canadian Country Codes Table:
Canadian Province/Territory Province Abbreviation Postal Code Beginning ### Note: If the Canadian Postal Code begins with one of the following, use the corresponding Country Code abbreviation in the right most column. Country Code Alberta AB T XA British Columbia BC V XB Manitoba MB R XM New Brunswick NB E XN Newfoundland and Labrador NL A XL Northwest Territories NT X XT Nova Scotia NS B XS Nunavut NU X XV Ontario ON K, L, M, N, or P XO Prince Edward Island PE C XP Quebec QC G, H, or J XQ Saskatchewan SK S XW Yukon YT Y XY The rest of the foreign address is edited using procedures in IRM 3.11.217.5.6, Entity Perfection - Domestic Addresses.
3.11.217.6 (01-01-2021)
Tax Period
- This subsection provides instructions for editing the tax period.
3.11.217.6.1 (01-01-2026)
Tax Period - General
Form 1120-S, U.S. Income Tax Return for an S Corporation, must have a tax period.
Exception:
Form 1120-S is for the current processing calendar year (e.g., 202512).
Note:
If the Form 1120-S has Schedule K-1s attached, the gusset can only contain the same tax year. If no Schedule K-1s are attached to the Form 1120-S, the gussets can have mixed tax years. For fiscal year filers, use the tax period ending from the Schedule K-1 to determine which tax year the taxpayer is filing for.
Edit the tax period to the right of the title area of Form 1120-S in YYMM format following the instructions below.
If... Then... The return is for the current processing calendar year (e.g., 202512), Do not edit the tax period. The return is for a prior year, Edit the tax period to the right of the form title in YYMM format. The taxpayer has notated a tax period other than the preprinted year on the return, Edit the tax period to the right of the form title in YYMM format based on the taxpayer’s indication, per paragraph (3). The tax period is missing, incomplete, or illegible, 1. Review the return or attachments for the correct period. 2. If found, edit the tax period to the right of the form title in YYMM format. 3. If unable to determine the tax period after researching, process the return for the year currently being processed. A tax period will end on the last day of a month. (Ignore a minor discrepancy such as October 30 instead of October 31). The exceptions are a 52-53-week filer, and final or short period returns. The table below identifies examples of tax periods.
Tax Period Ends Tax Period Oct. 3, 2025 (52-53-week document) 2509 Oct. 3, 2025 (Final short period return) 2510 Oct. 25, 2025 (52-53-week document) 2510 Oct. 25, 2025 (Final short period return) 2510 Nov. 30, 2025 2511 Dec. 31, 2025 2512 (no editing is required) Feb. 28, 2026 2602 Tax periods reported under the 52-53-week rule must end not more than six days before, and not more than three days after, the end of a month. In the edit format, use the numeric designation of the month, the last day of which is closest to the actual ending date.
If... Then... The tax period ending is not more than three days after the beginning of the month, Edit the previous month (e.g., October 3, use the numeric designation for September, YY09). The tax period ending is not more than six days before the end of the month, Edit the month shown on the return (e.g., October 25, use the numeric designation for October, YY10). Tax period ending is more than six days before the end of the month or three days after the beginning of the month, and is not a Final, Correspond to determine the correct tax period ending. If the tax period is for more than 12 months or 53 weeks, correspond.
On a "Final" return, if the month and year is equal to or later than the received date month and year (future return) or the taxpayer has not shown in which month the business ended, edit the tax period to be one month before the received date. See Figure 3.11.217-7, Example of Editing an Early Filed Final Return.
Figure 3.11.217-7
This is an example of a completed Form 1120-S (Page 1 top part only). Top left corner of Form 1120-S reads: DRAFTFor calendar year or tax year beginning shows 01/01/26, with preprinted tax year crossed out, and tax year ending 10/16, 2026The tax period beginning 010126 is edited in red to the right of the preprinted 1120-S in the upper left area of the form.The tax period 2606 is edited in red above the ending tax period area of the form.Box A shows 06/09/2001 for the effective date of the S electionBox B shows 441120 for the Business Activity CodeBox D shows 00-4623189 for the Employer Identification Number (EIN)Box E shows 06/09/2001 for the date incorporated.Poplar Used Car Sales shown on the name line and POPL is underlined in red as the name control204 Balsam Ave is shown for the street address lineFargo, ND 58102 is shown for the city, state, and ZIP code lineBox F shows $0 for Total AssetsBox H shows an “X” in the Final return boxBox I shows 1 for the Number of Shareholders during any part of the tax yearLine 1c shows 0Line 6 shows 0Computer Condition Code F is edited in red in the center dotted part of Line 3.The IRS Received Date stamp of 07172026 is shown in the middle of the formA text box located to the left middle of the Form 1120-S has an arrow on the top right side of the box pointed to the tax period ending date and another arrow on the bottom right side of the box pointed to the Received Date. The text box reads: Early Filed Final:Edit the Tax Period ending date to be one month before the Received Date.
On a "Final" return, if the received date is after the short period due date but on or before the regular full tax period due date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, edit CCC "R" and CCC "F" . See IRM 3.11.217.6.3(2), Early Filed Return, and Exhibit 3.11.217-2, Due Date Chart, for more information. See Figure 3.11.217-8, Example of Editing CCC “F” and CCC “R” on Form 1120-S.
Note:
Also edit CCC "D" if the return is a Balance Due.
Figure 3.11.217-8
This is an example of a completed “Final” Form 1120-S (Page 1 only) with Computer Condition Code (CCC) F and CCC R. Top left corner of Form 1120-S reads: DRAFTFor calendar year or tax year beginning shows 01/01/25, and tax year ending 08/31, 2025The tax period beginning 010125 is edited in red to the right of the preprinted 1120-S in the upper left area of the form.The tax period 2508 is edited in red above the ending tax period area of the form.Box A shows 09/12/2011 for the effective date of the S electionBox B shows 811420 for the Business Activity CodeBox D shows 00-3229875 for the Employer Identification Number (EIN)Box E shows 09/12/2011 for the date incorporatedPine Antiques Shop shown on the name line and Pine is underlined in red as the name control15 East Cypress Blvd is shown for the street address lineBoise, ID 83708 is shown for the city, state, and ZIP code lineBox F shows $0 for Total AssetsBox H shows an “X” in the Final return boxBox I shows 1 for the Number of Shareholders during any part of the tax yearLine 1c shows 0Line 6 shows 0Computer Condition Code (CCC)”F” and CCC “R” is edited in red in the center dotted part of Line 3.The IRS Received Date stamp of 02182026 is shown in the middle of the formA text box located to the left middle of the Form 1120-S has an arrow on the top right side of the box pointed to the tax period ending date and another arrow on the bottom right side of the box pointed to the Received Date. The text box reads: Received Date after the Short Period Due Date, but before the regular full Tax Period Due Date
The separate short period return of a subsidiary which became affiliated with a "consolidated" group may end on the day preceding such affiliation. As a practical matter, do not question the ending date on any change-of-accounting period return.
Check all tax periods for the Statute of Limitation (two years and nine months from the normal due date of the return). For statute instruction, see IRM 3.11.217.3.7, Statute Returns.
3.11.217.6.2 (01-01-2026)
Tax Period Beginning - Final, Initial, or Short Period Return
Edit the Tax Period Beginning to the left of the title area of Form 1120-S, U.S. Income Tax Return for an S Corporation, in MMDDYY format following the instructions below: (See Figure 3.11.217-9, Example of Editing the Tax Period Beginning.)
If... And... Then... The return is a final, initial, or a short period, Tax Period Beginning is present, Edit the Tax Period Beginning (MMDDYY). The return is a final, initial, or a short period, The day is not present in the Tax Period Beginning, Edit "01" for the day. For example, taxpayer writes May 2025, edit Tax Period Beginning as 050125. The return is a final, initial, or a short period, Tax Period Beginning is not present, No editing is required. Note:
See IRM 3.11.217.6.1, Tax Period - General, for more information.
Figure 3.11.217-9
This is an example of a completed Form 1120-S (Page 1 through Line 4). Top left corner of Form 1120-S reads: DRAFTFor calendar year or tax year beginning shows Feb. 01, 2025, and tax year ending Aug. 15, 2025The tax period beginning 020125 is edited in red to the right of the preprinted 1120-S in the upper left area of the form.The tax period 2508 is edited in red above the ending tax period area of the form.Box A shows 01-31-84 for the effective date of the S electionBox B shows 523140 for the Business Activity CodeBox D shows 00-0509487 for the Employer Identification Number (EIN)Box E shows 01-31-84 for the date incorporated.Maple Pancakes House is shown on the name line and MAPL is underlined as the name control1259 Acacia Blvd is shown for the street address lineFargo, ND 58102 is shown for the city, state, and ZIP code lineBox F shows $75,846 for Total AssetsBox H shows a “✓” (check mark) in the Final return boxBox I shows 1 for the Number of Shareholders during any part of the tax yearComputer Condition Code F is edited in red in the center dotted part Line 3.
3.11.217.6.3 (01-01-2026)
Early Filed Return
Never send an early filed return back to the taxpayer.
If the month of the tax period is the same or after the month of the received date, determine how early the return was filed:
If... Then... The Tax Period Ending (TPE) is equal to or later than the received date by four months or less (e.g., the received date is in April but the TPE is April, May, June, or July) and is not marked final, 1. Edit Action Code 480 (Early Filed - Suspense). See Figure 3.11.217-10, Example of Early Filed Return – Editing Action Code 480 vs Action Code 211. 2. Leave return in batch. The Tax Period Ending (TPE) is later than the received date by more than four months (e.g., the received date is in April but the TPE is in September) and it is not marked final, 1. Edit Action Code 211 or 215 and attach approved Correspondence Action Sheet to request confirmation of the Tax Period Ending. See Figure 3.11.217-10, Example of Early Filed Return – Editing Action Code 480 vs Action Code 211. 2. Completely edit the return. Edit the future tax period shown by the taxpayer. Leave return in batch. On a "Final" return, the received date is after the short period due date, but on or before the regular full tax period due date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, 1. Edit CCC "R." 2. Edit CCC "F." 3. Edit CCC “D” if the return is a Balance Due. 4. See IRM 3.11.217.6.1, Tax Period - General, for more information. Note:
See IRM 3.11.217.6.1, Tax Period - General, for more information.
Figure 3.11.217-10
This is an example of a Form 1120-S with Early Filed Return – Editing Action Code 480 vs Action Code 211.First Form 1120-S: Top part of Form 1120-S with a tax year beginning 07-01, 2025, and tax year ending 06-30, 2026. Red edited tax period “2606” above the ending tax year information.Top left corner of Form 1120-S reads: DRAFTThe IRS Received Date stamped above the Sign Here area: that reads: RECEIVED00104172026KANSAS CITY, MOIRS-KCSCSign Here box: Signature of officer: Mark CypressRed edited Action Code 480 in the bottom left margin areaA text box located at the bottom center of Form 1120-S reads: Early Filed: Four Months or LessSecond Form 1120-S: Top part of Form 1120-S with a tax year beginning 10-01, 2025, and tax year ending 09-30, 2026. Red edited tax period “2609” above the ending tax year information.The IRS Received Date stamped above the Sign Here area: that reads: RECEIVED00104172026KANSAS CITY, MOIRS-KCSCSign Here box: Signature of officer: Pamela MangroveRed edited Action Code 211 in the bottom left margin areaA text box located at the bottom center of Form 1120-S reads: Early Filed: More than Four Months
3.11.217.6.4 (01-01-2026)
Short Period - Editing Proof of Entitlement
A Short Period Return is one which covers a period of less than 12 months or 52-53 weeks.
If the Short Period Return is marked "Final" , see instructions for editing the tax period in IRM 3.11.217.6.1, Tax Period - General.
If the Short Period Return is marked "Initial" , "First Return" , "New Corporation" , etc., or meets any of the identifying conditions in the instructions for "Initial Return Code" , see IRM 3.11.217.11, Initial Return Code - Page 1, Box G, Is the corporation electing to be an S corporation beginning with this tax year?
Process all other Short Period Returns as a "Change of Accounting Period" . In such cases, proof of entitlement to the change is required.
Reminder:
Edit the Tax Period Beginning in MMDDYY format on short period returns per IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
Use the Proof of Entitlement Table below to identify and edit proof of entitlement.
If... And... Then... A statement the S Corporation is changing tax period under: 1. National Office "Grant Letter" or 2. Revenue Procedure 2006-46, Command Code BMFOLE shows a Transaction Code (TC) 053 or TC 054, ### Note: This is an indication that the Form 1128, Application to Adopt, Change, or Retain a Tax Year, or National Office "Grant Letter" was approved. Continue processing the return. See Figure 3.11.217-11, Example of a Short Period Return with Proof of Entitlement. ### Note: No CCC "Y" is needed. A statement the S Corporation is changing tax period under: 1. National Office "Grant Letter" or 2. Revenue Procedure 2006-46, Command Code BMFOLE shows a TC 059, ### Note: This is an indication that the Form 1128, Application to Adopt, Change, or Retain a Tax Year, or National Office "Grant Letter" has not been approved. The return is unprocessable. Follow the instructions for "Short Period Returns - Editing a Disapproved Application" . See IRM 3.11.217.6.6, Short Period Returns - Editing a Disapproved Application (Form 1128). Statement referring to "S" (1120-S) Status Termination or revocation under Section 1362, or Form 1120-S, Page 1, Item H, Box 5, S Election termination or revocation is checked, Edit CCC "R" . ### Note: No CCC "Y" is needed. ### Caution: If return reflects tax, or if return was filed after the due date based on a full year, prepare Form 3465, Adjustment Request, and route Form 3465 and a copy of Form 1120-S, Page 1 to Accounts Management (AM) requesting review of interest and/or Failure To File (FTF) penalty. Statement referring to Termination of Shareholders Interest under Section 1377(a)(2) and Regulations Section 1.1377-1(b), Continue processing the return. ### Note: No CCC "Y" is needed. Statement referring to "S" Status Election and a National Office "Grant Letter" is attached allowing the fiscal year (other than 12/31/XX), Continue processing the return. ### Note: No CCC "Y" is needed. Notation referring to: 1. Section 444 or 2. Reference to Revenue Procedure 2006-46, Command Code BMFOLE shows a Transaction Code (TC) 053, TC 054, or TC 055, ### Note: This is an indication that the Form 1128, Application to Adopt, Change, or Retain a Tax Year, or Form 8716, Election To Have a Tax Year Other Than a Required Tax Year, was approved. Continue processing the return. ### Note: No CCC "Y" is needed. Notation referring to: 1. Section 444 or 2. Reference to Revenue Procedure 2006-46, Command Code BMFOLE shows a TC 058 or TC 059, ### Note: This is an indication that the Form 8716, Election To Have a Tax Year Other Than a Required Tax Year, or Form 1128, Application to Adopt, Change, or Retain a Tax Year, has not been approved. The return is unprocessable. Follow the instructions for "Short Period Returns - Editing a Disapproved Application" . See IRM 3.11.217.6.6, Short Period Returns - Editing a Disapproved Application (Form 1128). Form 1128, Application to Adopt, Change, or Retain a Tax Year, Command Code BMFOLE shows a Transaction Code (TC) 053 or TC 054, ### Note: This is an indication that the Form 1128 was approved. Continue processing the return. ### Note: No CCC "Y" is needed. Form 1128, Application to Adopt, Change, or Retain a Tax Year, Command Code BMFOLE shows a TC 059, ### Note: This is an indication that the Form 1128 has not been approved. The return is unprocessable. Follow the instructions for Short Period Returns - Editing a Disapproved Application. See IRM 3.11.217.6.6, Short Period Returns - Editing a Disapproved Application (Form 1128). Form 1128, Application to Adopt, Change, or Retain a Tax Year, Command Code BMFOLE does not show Transaction Code (TC) 053, TC 054, or TC 059, See IRM 3.11.217.6.7, Editing Form 1128 With No Indication of Approval or Disapproval. Statement referring to Qualifying Disposition under Regulations Section 1.1368-1(g)(2)(i), Edit CCC "Y" . Statement referring to "S" Status Election and taxpayer is changing to required tax year (12/31/XX), Edit CCC "Y" . Statement the S Corporation is coming out of consolidation, Edit CCC "Y" . Statement the corporation is a qualified sub chapter S subsidiary, Edit CCC "Y" . Notation referring to: 1. "Section 1398 election" (Bankruptcy Petition was filed), or 2. "Second Short Year after Section 1398 Election" , Edit CCC "Y" . Do not correspond. The following table is a list of transaction codes and meanings.
Transaction Code (TC) Meaning 053 A TC 053 identifies a Fiscal Year Month (FYM) change from Form 1128, Application to Adopt, Change, or Retain a Tax Year, (other than Revenue Procedure 2006-46). 054 A TC 054 identifies a FYM change from Form 1128, Application to Adopt, Change, or Retain a Tax Year, or Form 2553, Election by a Small Business Corporation, approved under Revenue Procedure 2006-46. 055 A TC 055 identifies a FYM change from Form 8716, Election To Have a Tax Year Other Than a Required Tax Year. 058 A TC 058 identifies a DeniedForm 8716, Election to Have a Tax Year Other Than a Required Tax Year. 059 A TC 059 identifies a DeniedForm 1128, Application to Adopt, Change, or Retain a Tax Year. Reminder:
Edit the Tax Period Beginning in MMDDYY format on short period returns according to IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
Figure 3.11.217-11
This is an example of a completed Form 1120-S (Page 1 through Line 6). An attached statement shows a change to the tax period. The attachment to the Form 1120-S reads:STATEMENT UNDER REVENUE PROCEDURE 2006-46 IN RELATION TO CHANGEOF TAX PERIOD(1) CORPORATION HAS NOT CHANGED ITS FISCAL YEAR DURING THELAST TEN CALENDAR YEARS.Form 1120-S fields are as follows:Top left corner of Form 1120-S reads: DRAFTFor calendar year or tax year beginning shows 06-01, 2025, and tax year ending 12-31, 2025The tax period beginning 060125 is edited in red to the right of the preprinted 1120-S in the upper left area of the form.Box A shows 6-1-80 for the effective date of the S electionBox B shows 453110 for the Business Activity CodeBox D shows 00-5718027 for the Employer Identification Number (EIN)Box E shows 6-1-80 for the date incorporated.Spruce Inc is shown on the name line and SPRU is underlined as the name control3112 Willow Ave. is shown for the street address lineOmaha, NE 68108 is shown for the city, state and ZIP code lineBox F shows $2,014,841 for Total AssetsBox I shows 1 for the Number of Shareholders during any part of the tax yearLine 1a, Gross receipts or sales, shows 1,222,796Line 1c, Balance, shows 1,222,796Line 2, Cost of goods sold, shows 794,152Line 3, Gross profit, shows 428,644Line 6, Total income (loss) shows 428,644To the left of Line 6: There is a text box that reads: Research Transaction Code (TC): TC 053 or TC 054 - Continue Processing.TC 059 - The return is unprocessable.
3.11.217.6.5 (01-01-2022)
Short Period - Missing Proof of Entitlement
If proof of entitlement is missing or the taxpayer says on the return or an attachment that the S Corporation has filed an application but has not received a response, research IDRS using Command Code BMFOLE (or other applicable Command Code) for approval or disapproval information and proceed as follows:
If... Then... Command Code BMFOLE shows a Transaction Code (TC) 053, TC 054, or TC 055, ### Note: This is an indication that the Form 1128, Application to Adopt, Change, or Retain a Tax Year or Form 8716, Election To Have a Tax Year Other Than a Required Tax Year, was approved. Continue processing the return. ### Note: No CCC "Y" is needed. ### Reminder: Edit the Tax Period Beginning on short period returns according to IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return. Command Code BMFOLE shows a TC 058 or TC 059, ### Note: This is an indication that the Form 8716, Election To Have a Tax Year Other Than a Required Tax Year, or Form 1128, Application to Adopt, Change, or Retain a Tax Year, has not been approved. The return is unprocessable. Follow the instructions for "Short Period Returns - Editing a Disapproved Application" . See IRM 3.11.217.6.6, Short Period Returns - Editing a Disapproved Application (Form 1128). Command Code BMFOLE does not show a TC 053, TC 054, TC 055, TC 058, or TC 059, Correspond with the taxpayer using Letter 319C, Return Covers Other Than 12-month Accounting Period. Reminder:
Edit the Tax Period Beginning in MMDDYY format on short period returns per IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
Note:
See IRM 3.11.217.6.4(2) for the list of transaction codes and meanings.
3.11.217.6.6 (01-01-2016)
Short Period Returns - Editing a Disapproved Application (Form 1128)
If Form 1128, Application to Adopt, Change, or Retain a Tax Year, is disapproved, the return is considered unprocessable:
Edit Action Code 211 or 215 and correspond.
In the correspondence, instruct the taxpayer to file a return for the next regular full period due. Request a disposition of any remittance paid with the return or other credits which have posted to the short period module.
Reminder:
Edit the Tax Period Beginning in MMDDYY format on short period returns per IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
3.11.217.6.7 (01-01-2026)
Short Period Returns - Editing Form 1128 With No Indication of Approval or Disapproval
When a Form 1128, Application to Adopt, Change, or Retain a Tax Year, is attached with no indication of approval or disapproval and no proof of entitlement is present, research Integrated Data Retrieval System (IDRS) using Command Code BMFOLE (or other applicable Command Code) for approval or disapproval and proceed as follows:
If... Then... Command Code BMFOLE shows a Transaction Code (TC) 053 or TC 054, ### Note: This is an indication that the Form 1128, Application to Adopt, Change, or Retain a Tax Year, was approved. Continue processing the return. ### Note: No CCC "Y" is needed. ### Reminder: Edit the Tax Period Beginning on short period returns according to IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return. Command Code BMFOLE shows a TC 059, ### Note: This is an indication that the Form 1128, Application to Adopt, Change, or Retain a Tax Year, has not been approved. The return is unprocessable. Follow the instructions for "Short Period Returns - Editing a Disapproved Application" . See IRM 3.11.217.6.6, Short Period Returns - Editing a Disapproved Application (Form 1128). Command Code BMFOLE does not show TC 053, TC 054, or TC 059, Take the actions in (2) below. Reminder:
Edit the Tax Period Beginning in MMDDYY format on short period returns per IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
Note:
See IRM 3.11.217.6.4(2), Short Period - Editing Proof of Entitlement, for the list of transaction codes and meanings.
Form 1128, Application to Adopt, Change, or Retain a Tax Year, with neither approval nor disapproval, stop processing Form 1120-S, U.S. Income Tax Return for an S Corporation. Route Form 1120-S and Form 1128 to Entity Control as directed in the paragraphs below.
If Form 1128, Application to Adopt, Change, or Retain a Tax Year, is attached to a numbered return, enter Action Code 320. Attach Form 4227, Intra-SC Reject or Routing Slip, and check the box for Entity Control. Edit the Form 1120-S received date to Form 1128. Leave the return in the batch and continue processing the return.
Note:
Do not detach Form 1128.
If Form 1128 is attached to an unnumbered return, edit the Form 1120-S received date to Form 1128, attach Form 4227, Intra-SC Reject or Routing Slip, and route the return to Entity Control. See Figure 3.11.217-12, Example of Form 1128 Attached With No Indication of Approval or Disapproval.
Note:
Do not detach Form 1128.
Entity will process the Form 1128 and route the return back to Code and Edit with a Form 4227, Intra-SC Reject or Routing Slip, attached. The Form 4227 will show if the Form 1128 is approved, denied, or returned and the words "Process Return" or "Let Unpost" .
Figure 3.11.217-12
This is an example of a completed Form 1120-S (Page 1), a Form 1128, Application To Adopt, Change, or Retain a Tax Year, attachment, and Form 4227, Intra-SC Reject or Routing Slip.Form 1128, Application To Adopt, Change, or Retain a Tax Year, is attached to Form 1120-S. The IRS Received Date is edited as Rec’d 030426 in the left margin of Form 1128.Form 1120-S fields are as follows:Top left corner of Form 1120-S reads: DRAFTFor calendar year or tax year beginning shows 9-1, 2025 and tax year ending 12-31, 2025The tax period beginning 090125 is edited in red to the right of the preprinted 1120-S in the upper left area of the form.Box A shows 12-02-84 for the effective date of the S electionBox B shows 448140 for the Business Activity CodeBox D shows 00-1758893 for the Employer Identification Number (EIN)Box E shows 12-02-84 for the date incorporated.Beech Fashion Inc. is shown on the name line and Beec is underlined as the name control1177 Poplar Ave. is shown for the street address lineNew York, NY 10001 is shown for the city, state, and ZIP code lineBox F shows 343,175 for Total AssetsLine 9 shows 70,000Line 12 shows 12,000Line 15 shows 15,000Line 19 shows 5,000Line 20 shows 97,000Line 21 shows 70,142Line 23c shows 990Line 26 shows 990Sign Here box: Signature of officer: Audrey AshSign Here box: Date: 02/13/26Sign Here box: Title: PresidentForm 4227, Intra-SC Reject or Routing Slip, is attached to the front of Form 1120-S, below the Entity information.Form 4227, Intra-SC Reject or Routing Slip, fields are as follows: Name-Unit box shows 210 in red circleDate box shows 031826 in redRoute to box shows a red X in the Entity Control boxBMF box shows a red XOther (explain) box shows a red X with red text that reads: Research for approval of Form 1128
3.11.217.6.8 (01-01-2026)
Short Period Return with Prepaid Credits
Route to Accounting for possible adjustment action any return meeting both conditions below.
A prepaid credit, Line 24a or Line 24b is claimed. (202301 and later)
The return is a short period (an initial return, a final return, or one with a change of accounting period).
Take the following action when routing these returns to Accounting:
Enter Action Code 342 on the return.
Attach Form 4227, Intra-SC Reject or Routing Slip, check the "Accounting" box and notate "Short period return with ES Credits" .
Continue normal processing.
If the return shows a refund, follow Refund Returns instructions in IRM 3.11.217.3.11, Refund Returns 45 Day Jeopardy and High Dollar Refunds.
See Figure 3.11.217-13, Example of Short Period Return with ES Credits.
Note:
2022 and prior Form Revisions have Prepaid Credits listed on lines 23a and/or 23b.
Reminder:
Edit the Tax Period Beginning in MMDDYY format on short period returns per IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
Figure 3.11.217-13
This is an example of a completed short period, final Form 1120-S (Page 1 only) and Form 4227, Intra-SC Reject or Routing Slip. There is an indication the return is a final return and prepaid credits are present on Line 23a and Line 23b. Form 1120-S fields are as follows:Top left corner of Form 1120-S reads: DRAFTTaxpayer wrote Final! in the center top area of the Form 1120-S.For calendar year or tax year beginning shows 01-01-26, with preprinted tax year 2025 crossed out, and tax year ending 04-30, 2026The tax period beginning 010126 is edited in red to the right of the preprinted 1120-S in the upper left area of the form.The tax period 2604 is edited in red above the ending tax period area of the form.Box A shows 1-16-85 for the effective date of the S electionBox B shows 812990 for the Business Activity CodeBox D shows 00-0001230 for the Employer Identification Number (EIN)Box E shows 1-16-85 for the date incorporated.Hemlock Valet Inc. is shown on the name line and HEML is underlined in red as the name control123 Pine Avenue is shown for the street address lineSan Jose, CA 95101 is shown for the city, state, and ZIP code lineBox F shows $110,120,500 for Total AssetsBox I shows 5 for the Number of Shareholders during any part of the tax yearComputer Condition Code F is edited in red in the dotted part to the right of Line 3, Gross profit.Line 1a, Gross receipts or sales, shows 650,800Line 1b, Less Returns and allowances, shows 50,700Line 1c, Balance, shows 600,100Line 3, Gross profit, shows 600,100Line 6, Total income (loss) shows 600,100Line 7, Compensation of officers, shows 25,000Line 9, Repairs and maintenance, shows 25,000Line 10 shows 126,300Line 11 shows 2,000Line 12 shows 5,800Line 14 shows 10,000Line 16 shows 5,100Line 18 shows 3,000Line 20 shows 113,000Line 21 shows 315,200Line 22 shows 284,900Line 23b shows 50,000Line 23c shows 50,000Line 24a shows 25,000Line 24b shows 7,500Line 24z shows 32,500Line 26, Amount owed, shows 17,500Sign Here box: Signature of officer: Catrina L. CedarSign Here box: Date: 6-7-26Sign Here box: Title: Vice-Pres.Action Code 342 is edited in the bottom left margin of the Form 1120-SForm 4227, Intra-SC Reject or Routing Slip, is attached to the front of Form 1120-S, below the Entity information. Form 4227 fields are as follows: Name-Unit box shows 210 in red circleDate box shows 7-22-26 in redRoute to box shows a red X in the Accounting boxBMF box shows a red XOther (explain) box shows a red X with red text that reads: Short period with ES Credits
3.11.217.7 (01-01-2025)
♦Received Date♦
The date a document is received in the Campus, or an IRS Office is the date stamped as the "IRS Received Date" .
All Form 1120-S, U.S. Income Tax Return for an S Corporation, returns require an IRS Received Date.
A return is considered timely if the envelope in which the return is contained is postmarked on or before the due date.
If... Then... The return is received within ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ the extended due date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, The return is considered timely. See Exhibit 3.11.217-2, Due Date Chart, for more information. The due date falls on a weekend or legal holiday, The return is timely if postmarked by the first business day following the weekend or legal holiday. The IRS Received Date stamp is after ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ of the legal or extended due date, the postmark date or shipment date is on or before the legal or extended due date, Edit the received date to agree with the postmark date or shipment date. See Figure 3.11.217-14, Example of Editing a Timely Received Date. ### Note: The postmark date or shipment date includes returns delivered by: * U.S. Postal Service (USPS) * Private Delivery Services (PDS), e.g., Federal Express Corporation (FedEx) or United Parcel Service (UPS)"designated" by the IRS. See IRM 3.10.72, Receiving, Extracting and Sorting, for a list of designated private delivery services, or * Returns with a Foreign Postmark ### Caution: ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ### Note: For certified mail only - If a postmark is not present, look for a "USPS.com Track & Confirm" record attached to the return (should be in front of the envelope). Use the "Acceptance" date on the record to determine timeliness and follow normal editing procedures. See Exhibit 3.11.217-8, USPS.com Track & Confirm Record. If the "USPS.com Track & Confirm" record is not attached, take no action. Figure 3.11.217-14
This is an example of a completed calendar year Form 1120-S (Page 1 only). The IRS Received Date stamp is 03252026 and the envelope postmark date is March 16, 2026. The return is considered timely filed. The received date day is circled and the postmark received day 16 is edited in red above it.Top left corner of Form 1120-S reads: DRAFTBox A shows 07-26-70 for the effective date of the S electionBox B shows 444130 for the Business Activity CodeBox D shows 00-7024653 for the Employer Identification Number (EIN)Box E shows 07-26-70 for the date incorporated.Larch Hardware Inc. is shown on the name line and LARC is underlined as the name control19 South 35th St. is shown for the street address lineHouston, TX 77013 is shown for the city, state, and ZIP code lineBox F shows $98,000 for Total AssetsBox I shows 3 for the Number of Shareholders during any part of the tax yearLine 5, Other income (loss), shows 94,593Line 6, Total income (loss) shows 94,593Line 9, Repairs and maintenance, shows 2,150Line 10, Bad debts, shows 1,500There is a text box located to the left of the received date stamp that reads as follows:The Return is Timely - Tax Period - 2512Due Date - 3/16/26Received Date - 03/25/26Postmark Date - 03/16/26Circle 25 from the Received Date and edit 16 above the date.There is an envelope below the Form 1120-S and the text box.The envelope has a postmark to the left of a Liberty Bell stamp with the following information:Houston, TXMAR16202677013The envelope is addressed toINTERNAL REVENUE SERVICEOGDEN UT 84201
When a Form 1120-S is delinquent and the taxpayer explains the return is late due to the rejection of a timely filed electronic return, check the return for a Modernized Electronic Filing (MeF) rejection notification.
Note:
Taxpayers are instructed to notate in red in the top margin of the return REJECTED ELECTRONIC RETURN to show the timely filed return can’t be filed electronically. The notation could be anywhere on the return and is not required, but they are required to attach a copy of the MeF rejection notification in order to show they qualify for an edited Received Date.
If a MeF rejection notification is not attached, perfection of the received date is not necessary. If a MeF rejection notification is attached, edit the IRS Received Date in MMDDYY format as follows:
Note:
The taxpayer has 10 days to resubmit an electronically filed return after being rejected and 10 days to submit a paper return after the last rejection. The first transmission of any rejected return must have been filed before the due date of the relevant form for this rule to apply.
If... And... Then... The postmark date is within 10 days of the date of the rejection, Edit the IRS Received Date to be the date of the rejection. For example, postmark date is 03-22-2026 and first rejection is 03-12-2026. Change received date to 031226. The postmark date is more than 10 days after the date of the rejection, Leave the IRS Received Date as is. For example, postmark date is 03-25-2026 and first rejection is 03-12-2026. Leave the received date as is. ### Exception: Change the received date to the postmark date if the postmark date makes the return timely. There are two rejections, Within 10 days of one another and one is within 10 days of the postmark date, Edit the IRS Received Date to be the date of the first rejection. For example, postmark date is 03-22-2026, the second rejection is 03-12-2026. The first rejection is 03-09-2026. Change the received date to 030926. There are two rejections with the time between the first rejection and the second rejection greater than 10 days, The second rejection is within 10 days of the postmark date, Edit the IRS Received Date to be the date of the second rejection. For example, postmark date is 03-22-2026, the second rejection is 03-12-2026. The first rejection is 03-01-2026. Change the received date to 031226. There are two rejections, Not within 10 days of one another and second rejection not within 10 days of the postmark date, Leave the IRS Received Date as is. For example, postmark date is 03-25-2026, the second rejection is 03-12-2026. The first rejection is 03-01-2026. Leave the received date as is. ### Exception: Change the received date to the postmark date if the postmark date makes the return timely. The received date may or may not be stamped on the face of the return.
A valid received date stamp may consist of the following:
The word "Received"
Month (alpha or numeric)
Day (for example "1" or "01" )
Year - four digits
"Area Office," Campus, Field Office, "Taxpayer Assistance Center (TAC) Site" plus the city, location, or functional area within one of these sites (e.g., Compliance Services Collection Operations (CSCO), Examination, Image Control Team (ICT). Correspondence Imaging Inventory (CII), Accounts Management (AM), etc.)
Exception:
Not all IRS offices are designated places for filing, and not all IRS employees are authorized to accept a tax return for processing. If a return contains a received date stamp from other than a Taxpayer Assistance Center (TAC), Lockbox, or the IRS campus (Compliance, Accounts Management, or Submission Processing (SP)), circle out the invalid received date and edit the correct received date according to instructions below. For example, returns received by the Taxpayer Advocate Service (TAS) or the IRS Office of Chief Counsel are not properly filed and a received date by that office is not the "IRS Received Date."
If the received date stamp is not present or the date is illegible or invalid, edit the received date in MMDDYY format in the middle of Page 1 of the return. See Figure 3.11.217-15, Example of Editing the Received Date. Edit the received date according to the following priority:
The earliest legible postmark date (U. S. Postal Service (USPS), foreign postmark, or Private Delivery Service (PDS)) on the envelope. Rules for using the U. S. Postal Service (USPS) postmark or foreign postmark date are as follows:
If... Then... An envelope is not attached, Use the postmark date stamped on the face of the return. A document was returned for insufficient postage, Use the postmark date that coincides with the correct delivery of the return. The postmark is missing, and the envelope is certified, Look for the "USPS.com Track & Confirm" record that was attached to the return (should be in front of the envelope). Use the "acceptance" date on the record to determine timeliness and follow normal editing procedures. See Exhibit 3.11.217-8, USPS.com Track & Confirm Record. If the "USPS.com Track & Confirm" record is not attached, take no action. An envelope has both a USPS and private metered postmark, Always use the USPS postmark. An envelope has a foreign and private metered postmark, Always use the foreign postmark. An envelope has two private metered postmarks, Always use the latest private metered postmark. An envelope has only one private metered postmark, Use the private metered postmark. Service Center Automated Mail Processing System (SCAMPS) digital Date.
Revenue officer's Signature Date.
Signature Date. (Only if within current year.)
Julian Date of the Document Locator Number (DLN) minus 10 days.
Current Date minus 10 days.
Figure 3.11.217-15
This is an example of a completed Form 1120-S (Page 1 only). The IRS Received Date is not present and the return is signed by a revenue officer Top left corner of Form 1120-S reads: DRAFTTC599 - Transaction Code 599 is written in the upper left margin of the Form 1120-S.Box A shows 7-5-87 for the effective date of the S electionBox B shows 238100 for the Business Activity CodeBox D shows 00-4560114 for the Employer Identification Number (EIN)Box E shows 7-5-87 for the date incorporated.Willow Cement Co. is shown on the name line and WILL is underlined as the name control3600 Fir Rd. is shown for the street address lineHartford, CT 06101 is shown for the city, state, and ZIP code lineBox F shows $27,460 for Total AssetsBox I shows 2 for the Number of Shareholders during any part of the tax yearLine 1a, Gross receipts or sales, shows 44,620Line 1c, Balance, shows 44,620Line 2, Cost of goods sold, shows 31,229Line 6, Total income (loss) shows 13,391The Received Date 080126 is edited in red in the center of the form.Sign Here box: Signature of officer: B. Birch, revenue officerSign Here box: Date: 8-3-26
Edit the received date as follows:
If... And... Then... A timely received date is the only received date stamped on the return, No editing is required. Two or more dates are stamped on the return, 1. Use the earliest IRS received date stamped on the return. 2. Circle all other dates (handwritten, or stamped, not needed for transcription. 3. See Figure 3.11.217-16, Example of a Multiple Valid Received Date. ### Note: Treat received dates that are circled out by another function as if they are not present. A Federal return is addressed to the IRS, Delivered to a state agency, Use the postmark date as the received date. A Federal return is addressed to a State agency, Use the IRS date stamp as the received date. The only received date on the return is a Taxpayer Advocate Service (TAS) Received Date or Chief Counsel Received Date, Circle out the TAS or Chief Counsel Received Date and edit the received date according to instructions. Reminder:
Check any envelope attached to the return for remittance. If found, hand carry remittance to manager.
Figure 3.11.217-16
This is an example of a completed calendar year Form 1120-S (Page 1 only). There are multiple IRS Received Dates stamped in the center of the return from various IRS areas.Top left corner of Form 1120-S reads: DRAFTBox A shows 07/05/2011 for the S election effective dateBox B shows 4615 for the Business Activity CodeBox D shows 00-4262501 for the Employer Identification Number (EIN)Box E shows 07/05/2011 for the date incorporated.Cypress Gold Inc. is shown on the name line and CYPR is underlined as the name control525 Maple Court #2 is shown for the street address lineBaltimore, MD 21233 is shown for the city, state, and ZIP code lineBox F shows $150,000 for Total AssetsBox I shows 4 for the Number of Shareholders during any part of the tax yearLine 1a, Gross receipts or sales, shows 110,000Line 1c, Balance, shows 110,000Line 3, Gross profit, shows 110,000Line 4, Net gain (loss) from Form 4797, shows 1,000Line 6, Total income (loss) shows 111,000Line 7, Compensation of officers, shows 20,000Line 11, Rents, shows 17,000Line 20, Other deductions, shows 6,000Line 21, Total deductions, shows 43,000Line 22, Ordinary business income (loss) shows 68,000There are multiple IRS Received Dates stamped in the center of the return from various IRS areas. The SPC Ogden, UT date stamp and the Kansas City, MO date stamp are circled out in red, leaving the SBSE Field Collection date stamp as the received date.First Received Date Stamp reads:RECEIVED MAR 13 2026SBSE FIELD COLLECTION GREENVILLE, NC - GROUP 43Second Received Date Stamp reads:Internal Revenue ServiceReceived LB #49MAR 25 2026 - Circled out in redSPC OGDEN,UTThird Received Date Stamp reads:RECEIVED00104152026 - Circled out in redKansas City, MOIRS-KCSCSign Here box: Signature of officer: James BeechSign Here box: Date: 3/11/26
If a return is faxed to another area of the IRS and then sent to Submission for processing, do not enter the Enterprise Electronic Fax (EEFax) Date as the IRS Received Date. Enter a received date according to normal procedures.
Caution:
Do not use the EEFax Date as the IRS Received Date.
3.11.217.8 (02-01-2024)
North American Industry Classification System (NAICS) Code - Page 1, Box B
The Principal Business Activity (PBA) Code is based on the North American Industry Classification System Code (NAICS). These codes are a high priority to the IRS. It is critical data for Statistics of Income, Examination, Research, and other Service organizations.
The NAICS Code is a four-digit (prior year) or six-digit code on Page 1, Box B of Form 1120-S.
A NAICS Code is required on Form 1120-S.
Exception:
Do not edit NAICS Code on an Amended (CCC G) return.
Only one NAICS Code can be used on the return. Edit the NAICS Code as follows:
If... Then... A legible six-digit NAICS Code is shown on Page 1, Box B, ### Note: The number may not have all repeating numbers, e.g., "000000" , "333333" , "666666" , etc. No editing is required. A legible four-digit NAICS Code is shown on Page 1, Box B, ### Note: The number may not have all repeating numbers, e.g., "0000" , "3333" , "6666" , "9999" , etc. No editing is required. Page 1, Box B is blank and Schedule B, Line 2a has a legible four-digits or six-digits NAICS code, Edit the NAICS code to Page 1, Box B. There is more than one NAICS Code on Page 1, Box B, Circle all but the first NAICS Code listed. Page 1, Box B is blank, illegible, has repeating numbers, or is other than four or six digits, Edit NAICS Code "999999" .
3.11.217.9 (01-01-2016)
Schedule M-3 Attached - Page 1, Box C
Edit Computer Condition Code "B" when the box on Form 1120-S, Line C, "Check if Schedule M-3 is attached" is marked or Schedule M-3 (Net Income (Loss) Reconciliation for S Corporations With Total Assets of $10 Million or More) is attached to the return.
Note:
Edit Audit Code "8" if Schedule M-3 is attached. See IRM 3.11.217.13.1, Audit Codes.
3.11.217.10 (01-01-2023)
Total Assets - Page 1, Box F
The first source for this entry is Form 1120-S, Page 1, Box F, Total Assets.
Compare Box F amount with Schedule L, Balance Sheets per Books, Line 15, Column (d), or an equivalent entry on a schedule(s) or attachment(s).
If Box F and Schedule L, Balance Sheets per Books, Line 15, Column (d), differ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, use the amount on Schedule L, Line 15, Column (d). Edit the amount to Box F. Bracket if negative.
If Schedule L, Balance Sheets per Books, Line 15, Column (d), is blank, then compute Lines 1 through 14, Column (d), and compare it with Box F. If there is only one entry in Column (d), Lines 1 through 14, use that figure to compare to Box F.
If Box F is blank, enter the amount from Schedule L, Line 15, Column (d) to Box F, in dollars only. Bracket if negative.
If Schedule L, Balance Sheets per Books, is blank, or missing, and there is an amount in Box F, place an X to the left of the entry.
If the amount in Box F is for cents only (e.g., $.89, -$.99), place an X to the left of the entry.
3.11.217.11 (01-01-2026)
Initial Return Code - Page 1, Box G
Edit an Initial Return Code 2 in the margin to the right of Page 1, Box E, DATE INCORPORATED if any of the following conditions are met:
Form 1120-S, Page 1, Box E, Date incorporated, has a date which is within 12 months from the tax period ending date.
Reminder:
Edit the Tax Period Beginning on initial returns according to IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
Page 1, Box G, "Is the corporation electing to be an S corporation beginning with this tax year?" is checked "Yes" .
There is a taxpayer notation of initial filing, such as, First Return, New Corporation, etc.
The date incorporated is within 24 months from the Tax Period Ending (or is not shown) and the taxpayer’s Balance Sheet, Beginning of tax year (first two columns of Schedule L, Balance Sheets per Books,) is blank or zeros (see Initial Return - 24 Month Rule Table below). See Figure 3.11.217-17, Example of Editing the Initial Return Code With 24 Month Rule.
Note:
Do not edit Initial Return Code "2" if the Balance Sheet is missing or the Balance Sheet was dummied.
Tax Period Ending 24 Month Cutoff Date 2612 01/01/2025 2611 12/01/2024 2610 11/01/2024 2609 10/01/2024 2608 09/01/2024 2607 08/01/2024 2606 07/01/2024 2605 06/01/2024 2604 05/01/2024 2603 04/01/2024 2602 03/01/2024 2601 02/01/2024 2512 01/01/2024 2511 12/01/2023 2510 11/01/2023 2509 10/01/2023 2508 09/01/2023 2507 08/01/2023 2506 07/01/2023 2505 06/01/2023 2504 05/01/2023 2503 04/01/2023 2502 03/01/2023 2501 02/01/2023 2412 01/01/2023 2411 12/01/2022 2410 11/01/2022 2409 10/01/2022 2408 09/01/2022 2407 08/01/2022 2406 07/01/2022 2405 06/01/2022 2404 05/01/2022 2403 04/01/2022 2402 03/01/2022 2401 02/01/2022 2312 01/01/2022 2311 12/01/2021 2310 11/01/2021 2309 10/01/2021 2308 09/01/2021 2307 08/01/2021 2306 07/01/2021 2305 06/01/2021 2304 05/01/2021 2303 04/01/2021 2302 03/01/2021 2301 02/01/2021 2212 01/01/2021 2211 12/01/2020 2210 11/01/2020 2209 10/01/2020 2208 09/01/2020 2207 08/01/2020 2206 07/01/2020 2205 06/01/2020 2204 05/01/2020 2203 04/01/2020 2202 03/01/2020 2201 02/01/2020 2112 01/01/2020 2111 12/01/2019 2110 11/01/2019 2109 10/01/2019 2108 09/01/2019 2107 08/01/2019 2106 07/01/2019 2105 06/01/2019 2104 05/01/2019 2103 04/01/2019 2102 03/01/2019 2101 02/01/2019
Figure 3.11.217-17
This is an example of a completed Form 1120-S (Entity part of the return and Page 4, Schedule L, attached) with the Initial Return Code 2 edited in red to the right of Box E.Top left corner of Form 1120-S reads: DRAFTAt the top of Form 1120-S, to the left of the preprinted tax year of the return is a black circle with a white 2 inside. This will be explained in the text box information below.Box A shows 8/09/2024 for the effective date of the S electionBox B shows 238300 for the Business Activity CodeBox D shows 00-4171976 for the Employer Identification Number (EIN)Box E shows 8/09/2024 for the date incorporated. There is a 2 edited in red to the right of Box E. There is a black circle with a white 1 inside. Above the red 2 is a black circle with a 4 inside.Box F shows $8,485 for Total AssetsAspen Carpet Inc. is shown on the name line and ASPE is underlined in red as the name control2875 Tupelo St is shown for the street address linePhoenix, AZ 85026 is shown for the city, state, and ZIP code lineLine I shows 1 for the Number of Shareholders.A text box located to the center of the Form 1120-S (below the Entity) has an arrow on the top right side of the box pointed to Box E, where there is a black circle with a white 1 inside. There is another arrow on the bottom center side of the box pointed to the Schedule L Column (a) and Column (b), where there is a black circle with a white 3 inside. The text box reads: IF the Date Incorporated 1 (black circle with 1 inside) is within 24 monthsof the Tax Period Ending 2 (black circle with 2 inside) (or not shown)AND the taxpayer’s beginning Balance Sheet3 (black circle with 3 inside) is blank or zerosTHEN edit the Initial Return Code 2. 4 (black circle with 4 inside)Form 1120-S, Schedule L, Balance Sheets per Books, is attached, showing no data entered in first two columns (a and b), indicating no beginning balance.Schedule L, Line 1, Column d shows 3,291Schedule L, Line 4, Column d shows 5,194Schedule L, Line 10a, Column c shows 28,705Schedule L, Line 10b, Column c shows 23,511Schedule L, Line 15, Column d shows 8,485Schedule L, Line 16, Column d shows 14,229Schedule L, Line 18, Column d shows 22,714Schedule L, Line 19, Column d shows 8,485
3.11.217.12 (01-01-2026)
Number of Shareholders - Page 1, Line I
Follow the instructions below for editing Form 1120-S, Page 1, Line I, Number of Shareholders.
Note:
If the entry on Line I is written in a non-numeric fashion ("two" instead of "2" ), edit the numeric equivalent on Line I and circle the non-numeric characters.
If... And... Then... Form 1120-S, Page 1, Line I, Number of Shareholders, is zero or blank, No Schedule(s) K-1 are attached and Schedule(s) K-1 are required, 1. Leave zero or blank. Do not edit Line I, Number of Shareholders 2. Correspond for the Schedules K-1. See IRM 3.11.217.45, Schedule K-1, for corresponding information. ### Exception: Do not correspond on Section 965 Returns. ERS will take care of any correspondence needed. See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information. Page 1, Line I, Number of Shareholders, is zero or blank, Schedule(s) K-1 are attached, Edit the number of Schedules K-1 to Page 1, Line I, Number of Shareholders. See Figure 3.11.217-18, Example of Editing Number of Shareholders. Page 1, Line I, Number of Shareholders, is zero or blank, No Schedule(s) K-1 are attached and correspondence is not necessary according to IRM 3.11.217.45 (2), Edit a "1" to Page 1, Line I, Number of Shareholders. Note:
See IRM 3.11.217.45, Schedule K-1 - Shareholder’s Share of Income, Deductions, Credits, etc., for more information.
Figure 3.11.217-18
This is an example of editing the Number of Shareholders. Top left corner of Form 1120-S reads: DRAFTBox A shows 07/03/95 for the effective date of the S electionBox B shows 441120 for the Business Activity CodeBox D shows 00-0599456 for the Employer Identification Number (EIN)Box E shows 07/03/95 for the date incorporated.Beech & Sons HVAC is shown on the name line and BEEC is underlined as the name control1478 Maple St. is shown for the street address lineFargo, ND 58102 is shown for the city, state and ZIP code lineBox F shows $0 for Total AssetsThere are three Schedule K-1s attached to the Form 1120-S. Top left corner of Schedule K-1s reads: DRAFT. A 3 has been edited in red to Form 1120-S, Line I, Number of Shareholders, since Line I is blank and there are three Schedule K-1s attached. Line 1a, Gross receipts or sales, shows 65,500Line 1c, Balance, shows 65,500Line 3, Gross profit, shows 65,500Line 6, Total income (loss) shows 65,500Line 11, Rents shows 2,300Line 13, Interest shows 17,653The IRS Received date stamp shows:RECEIVED00106152026OGDEN, UTIRS-OSC
3.11.217.13 (01-01-2025)
Additional Form 1120-S Perfection
This subsection provides instructions for editing more Form 1120-S information.
Entries previously entered on the Form 3892, Corporation Edit Sheet, are edited in the left margin near Line 9 (Deductions area) of Form 1120-S.
Edit entries in numeric order (e.g., 1-2, 4-1). Edited information will be preceded by the applicable number as follows:
If... Then... Editing an Audit Code, Edit "1 -" followed by the correct Audit Code(s). (e.g., "1 - 2" ). See IRM 3.11.217.13.1, Audit Codes. Editing a Penalty and Interest Code, Edit "2 -" followed by the Penalty and Interest Code. (e.g., "2 - 1" ). See IRM 3.11.217.13.2, Penalty and Interest Code. Editing an Installment Sale Indicator, Edit "3 -" followed by the correct Installment Sale Indicator. (e.g., "3 - 2" ). See IRM 3.11.217.13.3, Installment Sale Indicator. Editing a Tax Preference Code, Edit "4 -" followed by the Tax Preference Code. (e.g., "4 - 1" ). See IRM 3.11.217.13.4, Tax Preference Code. Editing Form 8586, Low Income Housing Credit, Edit "5 -" followed by the Form 8586 credit in dollars only. (e.g., "5 - 357" ). See IRM 3.11.217.13.5, Low-Income Housing Credit. Editing Form 8611, Recapture of Low-Income Housing Credit, Edit "6 -" followed by the Form 8611 credit in dollars only (e.g., "6 - 753" ). See IRM 3.11.217.13.6, Form 8611, Recapture of Low-Income Housing Credit. The Return Processing Code (RPC) is edited on Page 1, in the right margin next to Line 1c (Total, Add Lines 1a and 1b) of Form 1120-S. See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information.
3.11.217.13.1 (01-01-2026)
Audit Codes
Up to nine (9) Audit Codes may be used at one time.
Note:
Audit Codes do not need to be edited in a specific order on the return.
Edit Audit Codes in the left margin near Line 9 (Deductions area) of Form 1120-S.
Edit as "1 -" followed by the correct code(s).
Audit Code "1" :
Form 8082, Notice of Inconsistent Treatment or Administrative Adjustment Request is attached.
Form 8275 or Form 8275R, Disclosure Statement, is attached or statement referring specifically to IRC 6662, (Disclosure).
Form 8886, Reportable Transaction Disclosure Statement, is attached. See IRM 3.11.217.14.14, CCC T - Form 8886, Reportable Transaction Disclosure Statement.
Audit Code "2" :
Form 1120-S, Schedule K, Line 16f*, Foreign taxes paid or accrued, has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ *(Prior year line numbers: 2020 - 2018: Line 14p, 2017 - 2004: Line 14l).
Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation, is attached.
Schedule N (Form 1120), Foreign Operations of U.S. Corporations, is attached and Questions 1a, 3, 4a (2019 and prior revisions), 5, or 7a are answered "Yes" .
Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations, is attached or Schedule N (Form 1120), Foreign Operations of U.S. Corporations, Question 4a is checked "Yes" .
Form 5472, Information Return of a Foreign-Owned Corporation (Under Sections 6038A and 6038C of the Internal Revenue Code), is attached.
Form 5713, International Boycott Report, is attached and both Questions in 7(f) are answered "Yes" .
Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund, is attached and Part V (Distributions From and Dispositions of Stock of a Section 1291 Fund), Lines 15a through Line 16f has an entry of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.
Form 8832, Entity Classification Election, is attached and Box 6(d), (e), or (f) is checked.
Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b), is attached.
Form 8858, Information Return of U.S. Persons With Respect To Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs) is attached or Schedule N (Form 1120), Foreign Operations of U.S. Corporations, Question 1a is checked "Yes" .
Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships, is attached.
Audit Code "3" :
Form 8883, Asset Allocation Statement Under Section 338, is attached and the amount in Box 5a, Stock Price is ≡ ≡ ≡ ≡ ≡ ≡ or more. See IRM 3.11.217.14.13, CCC S - Form 8883, Asset Allocation Statement Under Section 338 for more information.
Form 8594, Asset Acquisition Statement Under Section 1060, is attached and the amount in Box 3 is ≡ ≡ ≡ ≡ ≡ ≡ or more.
Audit Code "4" :
Entity Control Unpostable Unit determines that a valid Form 2553, Election by a Small Business Corporation is on file, the Form 1120, U.S. Corporation Income Tax Return, must be converted to Form 1120-S, U.S. Income Tax Return for an S Corporation.
Caution:
If you receive a Form 1120-S converted from Form 1120 and the Form 13596, Reprocessing Returns, is attached for reprocessing, see IRM 3.11.217.3.8.2, Form 13596 - Reprocessing Returns, for more information.
Audit Code "5" :
- Form 1120-S, Schedule K, Line 10, Other Income (Loss), reflects a loss of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.
Audit Code "6" :
- Presence of Form 3115, Application for Change in Accounting Method.
Audit Code "7" :
Form 1120-S, Schedule K, Line 16f*, Foreign taxes paid or accrued, has an entry equal to or less than ≡ ≡ ≡ ≡ ≡. *(Prior year line numbers: 2020 - 2018: Line 14p, 2017 - 2004: Line 14l)
Form 5713, International Boycott Report, is attached and both questions in 7(f) are not answered "Yes" .
Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company, or Qualified Electing Fund is attached and Part V (Distributions From and Dispositions of Stock of a Section 1291 Fund), Lines 15a through Line 16f has an entry of less than ≡ ≡ ≡ ≡ ≡.
Audit Code "8" :
Edit Audit Code "8" if the following schedule is attached: Schedule M-3, Net Income (Loss) Reconciliation for S Corporations With Total Assets of $10 Million or More.
Reminder:
See IRM 3.11.217.14.1, CCC "B" - Schedule M-3 for more information.
Audit Code "9" :
- The date shown in Box A falls during the tax year for which the S Corporation return is being filed and the Date Incorporated in Box E is more than one year earlier than the Date of Election as an S Corporation in Box A. See Figure 3.11.217-19, Example of Editing Audit Code "9" .
Audit Code "C" - Edit audit code C when Form 8283, Noncash Charitable Contribution, is attached and Part I has any of the following conditions:
Form 8283 (Noncash Charitable Contributions), Box 2b is checked, or
Box 2b1 is checked, or
Line 3, column (h) has an entry.
Figure 3.11.217-19
This is an example of a completed fiscal year Form 1120-S (Page 1 only) with Audit Code 9.Top left corner of Form 1120-S reads: DRAFTThe tax year beginning 050125 is edited in red to the right of the preprinted Form 1120-SThe tax period 2604 is edited in red to the left of the preprinted tax year of the Form 1120-S. To the left of the tax period is a black circle with a white 1 inside.For calendar year 2025 or tax year beginning shows May 1 2025, ending Apr 30 2026Box A shows 05/01/25 for the effective date of the S electionBox B shows 561500 for the Business Activity CodeBox D shows 00-1070871 for the Employer Identification Number (EIN)To the left of the Box E is a black circle with a white 3 insideBox E shows 06/01/07 for the date incorporatedThe Initial Return Code 2 is edited in red to the right of Box EBox F shows $15,078 for Total AssetsTo the left of the Name line is a black circle with a white 2 insidePoplar Travel is shown on the name line and POPL is underlined as the name controlP.O. Box 1350 is shown for the street address lineNew Orleans, LA 70113 is shown for the city, state, and ZIP code lineBox G, Is the corporation electing to be an S corporation beginning with this tax year, Yes box is checkedBox I, Enter the number of shareholders who were shareholders during any part of the tax year, shows 1Line 4 shows 423Line 6 shows 423Audit Code 9 is edited as 1-9 in the left margin near Line 9 of Form 1120-SThere is a text box located in the center of the Form 1120-S (below the Entity area) with an arrow coming out the bottom left side of the box pointed to the left of Line 9, where 1-9 (Audit Code 9) is edited in red. The text box reads as follows: IF The date shown in Box A (black circle with a white 2 inside) falls during the tax year for which the S Corporation return is being filed (black circle with a white 1 inside)ANDBox E (black circle with a white 3 inside) is more than one year earlier than Box A (black circle with a white 2 inside)THENEdit Audit Code 9.
3.11.217.13.2 (01-01-2022)
Penalty and Interest Code
Edit the Penalty and Interest Code in the left margin near Line 9 (Deductions area) of Form 1120-S.
Edit as "2 - 1" if pre-computed interest or delinquency penalty is shown on a return with a received date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.
This code is valid only within the unextended (original) ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡. When the pre-computed interest does not pertain to the ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ but to some other situation, such as an Estimated Tax Penalty, do not code 1 and do not edit Computer Condition Code R.
Note:
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
3.11.217.13.3 (01-01-2022)
Installment Sale Indicator
Form 6252, Installment Sale Income, is used to report the sale of property on the installment plan.
Codes are based solely on the S Corporation's response to Question 3 on Form 6252.
Edit the Installment Sale Indicator in the left margin near Line 9 (Deductions area) of Form 1120-S.
Edit as "3 -" followed by the correct code.
Valid codes for installment Sale Indicator are as follows:
Code One Form 6252 Multiple Forms 6252 1 "Yes" response to Question 3. At least one form has a "Yes" response. 2 "No" response to Question 3. All "No" responses or a combination of "No" or blank responses. 3 "Yes" and "No" are checked or Question 3 is blank. Question 3 is blank on all returns. See IRM 3.11.217.42, Form 6252, Installment Sale Income, for more information.
3.11.217.13.4 (01-01-2023)
Tax Preference Code
Edit the Tax Preference Code in the left margin near Line 9 (Deductions area) of Form 1120-S as "4 - 1" if
Form 4626, Alternative Minimum Tax - Corporations, for tax periods ending November 30, 2018 (201811) and prior, is attached and an amount is present on Lines 3, 6, or 11.
Schedule K-1, Shareholder's Share of Income, Deduction, Credits, etc., Line 15, Alternative Minimum Tax (AMT) Items, sum equals an amount of more than ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ after computing positive or negative amounts.
Note:
Entries on Form 1120-S, Schedule K, Lines 15a through Line 15f are an indication that the Schedule K-1 may have Tax Preference Items.
See Figure 3.11.217-20, Example of Editing the Tax Preference Code.
Figure 3.11.217-20
This image has been removed because it contains Official Use Only Content.
3.11.217.13.5 (01-01-2025)
Form 8586, Low-Income Housing Credit
Edit the Form 8586, Low-Income Housing Credit, in the left margin near Line 9 (Deductions area) of Form 1120-S.
Edit as "5 -" followed by the credit amount in dollars only.
When editing Form 1120-S, Schedule K, Line 13a or Line 13b for Form 8586, Low-Income Housing Credit, take the following actions:
If... Then... Form 8586 is attached with an entry on Lines 1 through Line 3 Enter CCC "9" . Form 8609-A is attached, Enter CCC "9" . Schedule K ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡Form 8586 is not attached, Correspond with the taxpayer for the missing Form 8586. Form 8586 is attached, In the left margin near Line 9 (Deductions area) of Form 1120-S, edit "5 -" followed by the amount on Line 5 of Form 8586 in dollars only. See Figure 3.11.217-21, Example of Editing Low-Income Housing Credit (Form 8586). ### Note: If the taxpayer attaches Form 8586 or shows the credit on Schedule K, and no significant entry on Line 13a or Line 13b, do not enter the amount from Form 8586 Line 5 in the left margin. Figure 3.11.217-21
This is an example of editing the Low Income Housing Credit from Form 8586. Form 8586, Low-Income Housing Credit, is attached.Name line shows Beech One & TwoIdentifying Number box shows 00-6647985Line 4 shows an amount 400The total on Line 5 is 400 and is edited in red to the left of the Deductions area of Form 1120-S, Page 1 preceded by the number 5 (e.g., 5-400).DRAFT is shown under the 5-400
3.11.217.13.6 (01-01-2025)
Form 8611, Recapture of Low-Income Housing Credit
Edit the Form 8611, Recapture of Low-Income Housing Credit, in the left margin near Line 9 (Deductions area) of Form 1120-S.
Edit as "6 -" followed by the credit amount in dollars only.
Form 8611 is required if Schedule K-1, Box 17, Code E or F shows a Form 8611 credit recapture ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.
Edit Form 8611 as follows:
If... Then... ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡Form 8611 is not attached, Correspond with the taxpayer for the missing Form 8611. Form 8611 is attached, In the left margin near Line 9 (Deductions area) of Form 1120-S, edit "6 -" followed by the Line 14, Form 8611 amount (in dollars only). Multiple Forms 8611 are attached, In the left margin near Line 9 (Deductions area) of Form 1120-S, edit "6 -" followed by the total of all Line 14, Forms 8611 amounts (in dollars only). Form 8611 is reported on Schedule K-1, Box 17, Code E or F or Form 8611 is attached, Enter CCC "9" .
3.11.217.13.7 (01-01-2026)
Return Processing Code (RPC)
A Return Processing Code (RPC) is an alpha character (e.g., A, B, C, D, E, F) or numeric character (e.g., 2, 4, 6, 7) used to alert the computer to a special condition.
The RPC is edited on Page 1, in the right margin next to Line 1c (Total, Add Lines 1a and 1b) of Form 1120-S. Thirty-five characters may be edited.
Note:
RPCs do not have to be edited in any specific order.
The table below lists the RPC and explanation when to edit each RPC.
RPC Explanation A Form 5471, Schedule E, Income, War Profits, and Excess Profits Taxes Paid or Accrued, is attached. B Form 5471, Schedule H, Current Earnings and Profits, is attached. C Form 5471, Schedule I-1, Information for Global Intangible Low-Taxed Income, is attached. D Form 5471, Schedule P, Previously Taxed Earnings and Profits of U.S. Shareholder of Certain Foreign Corporations, is attached. E Form 8865, Schedule G, Statement of Application of the Gain Deferred Method Under Section 721(c), is attached. F Form 8865, Schedule H, Acceleration Events and Exceptions Reporting Relating to Gain Deferral Method Under Section 721(c), is attached. G Form 5471, Schedule G-1, Cost Sharing Arrangement, is attached. H Form 5472, Foreign Corporation Engaged in a U.S. Trade or Business, Part VIII has an entry (e.g., description, checkbox marked, percent, or an amount). J For tax periods 202201 - 202212, taxpayer writes IRA22DPE or CHIPS22DPE on Form 1120-S, line 24d or on an attachment. ### Note: Do not edit RPC “J” on Tax Year 2023 and later returns processed in processing year 2026 . K For tax periods 202201 - 202212, taxpayer writes IRA22TRE at the top of the return or on an attachment. ### Note: Do not edit RPC "K" on Tax Year 2023 and later returns processed in processing year 2026. L Form 7204, Consent to Extend the Time to Assess Tax Related to Contested Foreign Income Taxes - Provisional Foreign Tax Credit Agreement, is attached. M Form 7205, Energy Efficient Commercial Buildings Deduction, is attached. 1 Not Applicable (N/A) at this time 2 Form 8992, U.S. Shareholder Calculation of Global Intangible Low-Taxed Income (GILTI), is attached. 3 Not Applicable (N/A) at this time. 4 Form 8994, Employer Credit for Paid Family and Medical Leave, is attached. 6 Form 8996, Qualified Opportunity Fund, is attached. ### Note: See IRM 3.11.217.23.2, Form 8996, Qualified Opportunity Fund Checkbox, and _IRM 3.11.217.33_Form 8996, Qualified Opportunity Fund, for more information. 7 Form 8990, Limitation on Business Interest Expense Under Section 163(j), is attached. 8 Not Applicable (N/A) at this time 9 Form 8997, Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments, is attached.
3.11.217.14 (01-01-2022)
Computer Condition Codes
Computer Condition Codes (CCCs) identify special conditions or computations for the computer. CCCs post to the Master File.
CCCs are edited in the center of Lines 1 and 2 of the Form 1120-S.
3.11.217.14.1 (01-01-2023)
CCC "B" - Schedule M-3
Edit CCC "B" when any of the following conditions are met:
Schedule M-3 (Net Income (Loss) Reconciliation for S Corporations With Total Assets of $10 Million or More) box on Form 1120-S, Page 1, Box C is checked, or
Schedule M-3 is attached.
Edit Audit Code "8" if Schedule M-3 is attached. See IRM 3.11.217.13.1, Audit Codes.
3.11.217.14.2 (01-01-2022)
♦CCC "D" - Reasonable Cause for Failing to Pay Timely♦
Do not edit CCC "D" if the taxpayer requests abatement for Failing to Pay Timely when the return is submitted. Send Letter 1382C, Penalty Removal Request Incomplete, to inform the taxpayer of the proper procedure to follow to request penalty abatement when a penalty is assessed.
Edit CCC "D" when the return is stamped: "DO NOT ASSESS FAILURE TO PAY PENALTY" .
Note:
Do not enter CCC "D" if the return was prepared by the IRS under IRC 6020(b) and the Return Due Date (without regard to extensions) is after July 30, 1996.
Edit CCC "D" on a "Final" , Balance Due return if the received date is after the short period due date but before the regular tax period due date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.
Edit CCC "D" if an S Corporation attaches a statement indicating the S Corporation qualifies for an automatic 3-month extension under Regulations Section 1.6081-5 or shows one of the following:
The domestic S Corporation transacts its business and keeps its books and records of account outside the United States and Puerto Rico, or
The domestic S Corporation's principal income is from sources within the possessions of the United States.
Exception:
Do not edit CCC "D" if the balance due is paid after the 15th day of the 6th month following the tax period ending date.
Do not edit CCC "D" when pre-computed penalty is shown on the return.
3.11.217.14.3 (01-01-2025)
CCC "E" - Potential Identity Theft Filing
Effective January 1, 2017, the BMF ID Theft Liaison may edit Computer Condition Code "E" on Form 1120-S (any year) to identify a potential identity theft filing if the return is claiming a refund of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡. If CCC "E" was edited, take no action.
Note:
CCC "E" may be edited by other functions. C&E will continue to follow procedures below.
If a tax examiner in Submission Processing (SP) Code and Edit (C&E) finds a case with attachments or correspondence indicating the taxpayer is a victim of ID Theft and the return is claiming a refund of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, give the whole case to your manager/lead. Your manager/lead will expedite the return to the Planning and Analysis (P&A) staff for referral to one of the SP BMF ID Theft liaisons. The taxpayer must show that they are a victim of "ID Theft" ; do not send cases that are subject to "Criminal Investigation (CI)" , "Examination (Exam)" , or "Fraud" review.
If the SP Theft Liaison says the return is "ID Theft" , the tax examiner will (upon request) edit CCC "E" .
3.11.217.14.4 (01-01-2024)
CCC "F" - Final Return
Edit CCC "F" when the "Final Return" box is checked or there is another indication the S Corporation is not liable for filing future returns. Notations such as (but not limited to):
Final
Deceased
Out-of-Business
Liquidation
Exempt under IRC 501(c)(3)
Dissolved
Cites IRC 708(b)(1)(B)
Notates "Filed in accordance with Rev. Proc. 2003-84"
The presence of Form 966, Corporate Dissolution or Liquidation is an indication of a possible dissolution. If Form 966 is attached, compare tax periods in Box 7a to the Form 1120-S being edited. If the tax periods are the same and the entity section of Form 966 is for the S Corporation, edit CCC "F"
Exception:
If "Filed Pursuant to Notice 97-4" is written on Form 966, do not use Form 966 as an indication that this is a final return.
If a prepaid credit is claimed (Lines 24a and 24b (202301 and later)) on a short period "Final" return, enter Action Code 342 on the return. See IRM 3.11.217.6.8, Short Period Return with Prepaid Credits.
Note:
2022 and prior Form Revisions have Prepaid Credits listed on lines 23a and/or 23b.
Edit the Tax Period Beginning on final returns according to IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
3.11.217.14.5 (01-01-2016)
♦CCC "G" - Amended Returns♦
- See IRM 3.11.217.3.9, Amended Returns.
3.11.217.14.6 (01-01-2016)
CCC "I" - Tax Straddles and Future Contracts (Form 6781)
Edit CCC "I" when Form 6781, Gains and Losses from Section 1256 Contracts and Straddles, is attached.
Note:
CCC "I" needs to be edited as a capital in block style to distinguish it from CCC "1" .
3.11.217.14.7 (01-01-2024)
CCC "J" - Section 965 Tax
The instructions in this subsection only apply to tax periods 201712 through 202012.
CCC "J" shows Section 965 (Repatriation Provision), Treatment of deferred foreign income upon transition to participation exemption system of taxation for U.S. Shareholders of Specified Foreign Corporations per Tax Cuts and Jobs Act of 2017, Provision Section 14103, Public Law 115-97 (H.R. 1).
Edit CCC "J" and Action Code 460 (Management Suspense) when:
"Section 965" or "965 Tax" (or similar language) notated on the return, schedules, attachments, or statements.
IRC 965 Transition Tax Statement (or similar 965 statement) is attached.
Form 965, Inclusion of Deferred Foreign Income Upon Transition to Participation Exemption System, is attached.
Form 965, Schedule A, U.S. Shareholder’s Section 965(a) Inclusion Amount, is attached.
Form 965, Schedule B, Deferred Foreign Income Corporation’s Earnings and Profits is attached.
Form 965, Schedule C, U.S. Shareholder’s Aggregate Foreign Earnings and Profits Deficit, is attached.
Form 965, Schedule D, U.S. Shareholder’s Aggregate Foreign Cash Position, is attached.
Form 965, Schedule E, U.S. Shareholder’s Aggregate Foreign Cash Position - Detail, is attached.
Form 965, Schedule F, Foreign Taxes Deemed Paid by Domestic Corporation, is attached.
Form 965, Schedule G, Foreign Taxes Deemed Paid by Domestic Corporation, is attached.
Form 965, Schedule H, Disallowance of Foreign Tax Credit and Amounts Reported on Forms 1116 and 1118, is attached.
Form 965-B, Corporate and Real Estate Investment Trust (REIT) Report of Net 965 Tax Liability and Electing REIT Report of 965 Amounts, is attached.
Form 1120-S, Schedule K, Line 10, Other income (loss), shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions).
Form 1120-S, Schedule K, Line 12d, Other deductions, shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions).
Form 1120-S, Schedule K, Line 14r, Other foreign tax information, shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions).
Form 1120-S, Schedule K, Line 17d, Other items and amounts, shows a significant entry with the notation "Section 965" or similar language.
Note:
A significant entry is defined as any amount other than zero.
3.11.217.14.8 (01-01-2022)
CCC "L" - Treaty Based Positions
Edit CCC "L" when:
Taxpayer writes "Section 6114 Election" on the return or,
Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b), is attached.
Note:
Edit Audit Code "2" if Form 8833 is attached to Form 1120-S. See IRM 3.11.217.13.1, Audit Codes.
3.11.217.14.9 (01-01-2025)
CCC "M" - Form 8949 Sales and Other Dispositions of Capital Assets
Edit CCC "M" when:
Tax period ending is 201712 and later, and
Form 8949, Sales and Other Dispositions of Capital Assets, contains a code "Z" or code "Y" in Column (f).
CCC "M" is for Form 8949 per Tax Cuts and Jobs Act of 2017, P.L. 115-97 (H.R. 1), Section 13823, Opportunity Zones. Taxpayers who elect to defer gain on the sale of an asset by investing in an Opportunity Zone Fund will show that they are deferring the gain by entering code "Z" or "Y" in Column (f).
3.11.217.14.10 (01-01-2016)
CCC "O" - Module Freeze
CCC "O" is entered when a Pre-Settlement Manual Refund will be made and a Form 3753, Manual Refund Posting Voucher, Form 5792, Request for IDRS Generated Refund (IGR), or Form 12857, Refund Transfer Posting Voucher, is attached. Verify that the Name Control, EIN, and Tax Period on the return is the same as the data on the form.
- Research to determine if "TC 840" (Manual Refund Transaction) has posted:
If... Then... "TC 840" has posted, Enter CCC "O" and continue processing the return. "TC 840" has not posted, Enter Action Code 341 to issue Manual Refund. TAS manual refund returns, see IRM 3.11.217.3.11, Refund Returns 45 Day Jeopardy and High Dollar Refunds, for processing instructions.
3.11.217.14.11 (01-01-2022)
CCC "P" - BMF Mail Indicator
- No editing is required.
3.11.217.14.12 (01-01-2024)
♦CCC "R" - Reasonable Cause for Failing to Timely File Return♦
Do not edit CCC "R" when a reason is given by the taxpayer for the delay in filing a return. Issue Letter 1382C, Penalty Removal Request Incomplete, and continue editing the return.
Exception:
Do not send Letter 1382C, Penalty Removal Request Incomplete, if the taxpayer has notated "Late filed return due to CCH software outage" or similar language.
Edit CCC "R" if an S Corporation attaches a statement indicating the S Corporation qualifies for an automatic 3-month extension under Regulations Section 1.6081-5 or shows one of the following:
The domestic S Corporation transacts its business and keeps its books and record of account outside the United States and Puerto Rico, or
The domestic S Corporation's principal income is from sources within the possessions of the United States
Exception:
Do not edit CCC "R" if the return is filed after the 15th day of the 6th month following the tax period ending date.
Edit CCC "R" on a "Final" return if the received date is after the short period due date but before the regular full tax period due date ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡.
Edit CCC "R" on the return when there is an indication such as "DO NOT ASSESS FAILURE TO FILE PENALTY" on a secured return annotated with "599" .
Edit CCC "R" on the short period return when the Statement referring to "S" (1120-S) Status Termination or revocation under Section 1362, or Form 1120-S, Page 1, Item H, Box 5, S Election termination or revocation is checked. See IRM 3.11.217.6.4, Short Period - Editing Proof of Entitlement, for more information.
Edit CCC "R" on the return if an internal use form or routing slip is attached and shows "DO NOT ASSESS FAILURE TO FILE PENALTY."
All CCC "R" coded returns must have an IRS received date. If one is not present, edit the IRS received date in the middle of the return.
3.11.217.14.13 (01-01-2016)
CCC "S" - Form 8883, Asset Allocation Statement Under Section 338
- Edit CCC "S" when Form 8883, Asset Allocation Statement Under Section 338, is attached to Form 1120-S.
3.11.217.14.14 (01-01-2017)
CCC "T" - Form 8886, Reportable Transaction Disclosure Statement
- Edit CCC "T" when Form 8886, Reportable Transaction Disclosure Statement, is attached to Form 1120-S. Edit Audit Code 1 when Form 8886 is attached. See IRM 3.11.217.13.1, Audit Codes.
3.11.217.14.15 (01-01-2022)
♦CCC "W" - Return Cleared by Statute Control♦
- Edit CCC "W" when Statute Control cleared the return. See IRM 3.11.217.3.7, Statute Returns.
3.11.217.14.16 (01-01-2022)
CCC "X" - Refund/Settlement Freeze
Edit CCC X when the taxpayer shows on the tax return a request that any balance left over after paying tax or penalties to be applied to another account. Take the following actions to route the request to Accounts Management (AM).
Prepare Form 3465, Adjustment Request, and show in the "Routing" box "Adjustments" .
Notate the requested action in the "Remarks" box.
Attach a copy of Page 1 of the tax return to Form 3465.
Reminder:
Subtract the tax, penalties, and interest amounts from the remittance amount if available.
3.11.217.14.17 (01-01-2024)
CCC "Y" - Short Period Return for Change of Accounting Period
Edit CCC "Y" for Change of Accounting Period. Enter only for short period returns due to change of accounting period (not due to initial or final filing). See Short Periods in IRM 3.11.217.6.4, Short Period-Editing Proof of Entitlement, through IRM 3.11.217.6.8, Short Period Return with Prepaid Credits.
Edit CCC "Y" on a Short Period Form 1120-S when the taxpayer shows any of the following:
Statement referring to Qualifying Disposition under Regulations Section 1.1368-1(g)(2)(i).
Statement referring to “S” Status Election and taxpayer is changing to required tax year (12/31/XX).
Statement the S Corporation is coming out of consolidation.
Statement the corporation is a qualified sub chapter S subsidiary.
Notation referring to “Section 1398 election” (Bankruptcy Petition was filed) or “Second Short Year after Section 1398 Election”.
Note:
See IRM 3.11.217.6.4, Short Period-Editing Proof of Entitlement, through IRM 3.11.217.6.8, Short Period Return with Prepaid Credits for more information.
If a prepaid credit is claimed on a short period return (Lines 24a and 24b), enter Action Code 342 on the return. See IRM 3.11.217.6.8, Short Period Return with Prepaid Credits.
Note:
2022 Form Revision has Prepaid Credits listed on lines 23a and/or 23b.
Edit the Tax Period Beginning on short period returns according to IRM 3.11.217.6.2, Tax Period Beginning - Final, Initial, or Short Period Return.
3.11.217.14.18 (01-01-2022)
CCC "1" - Like-Kind Exchanges
- Edit CCC "1" if Form 8824, Like-Kind Exchanges (and section 1043 conflict-of-interest sales), is attached.
3.11.217.14.19 (03-09-2017)
CCC "2" - Form 8938, Statement of Specified Foreign Financial Assets
Edit CCC "2" if Form 8938, Statement of Specified Foreign Financial Assets, is attached to Form 1120-S.
See IRM 3.11.217.27.10, Schedule N (Form 1120), Line 8 - Statement of Specified Foreign Financial Assets, and IRM 3.11.217.46, Form 8938, Statement of Specified Foreign Financial Assets, for more information.
3.11.217.14.20 (01-01-2022)
♦CCC "3" - No Reply to Correspondence♦
- Edit CCC "3" if the return is unprocessable and there is a sign that correspondence was sent, but no reply received.
3.11.217.14.21 (01-01-2022)
CCC "8" - Waiver of Estimated Tax Penalty
Edit CCC "8" when any of the following is present:
Form 2220, Underpayment of Estimated Tax by Corporations, is attached and Part II, Box 6 or Box 7 is checked.
Form 2220 is attached and any column on Form 2220, Schedule A, Page 4, Line 38 has entries.
3.11.217.14.22 (01-01-2026)
CCC "9" - Low-Income Housing Forms
Edit CCC "9" when any of the following are attached:
Form 8611, Recapture of Low-Income Housing Credit.
Form 8609-A, Annual Statement for Low-Income Housing Credit (prior year Form 8609, Schedule A).
Form 8586, Low-Income Housing Credi.
Edit CCC "9" whenever recapture tax for Low-Income Housing Credit is reported on Schedule K-1, Line 17, Code E or .
3.11.217.15 (01-01-2016)
Return Processing
- This subsection provides instructions for processing Form 1120-S, U.S. Income Tax Return for an S Corporation. Form 1120-S can be filed for a calendar year or a fiscal year.
3.11.217.15.1 (01-01-2026)
Sequence of Return - Form 1120-S
Document Perfection is responsible for arranging Form 1120-S in the following order when transcription line entries are present:
Pages 1, 2, 3, 4, 5, Form 1120-S, U.S. Income Tax Return for an S Corporation
Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation
Form 1125-A, Cost of Goods Sold
Schedule D, (Form 1120-S) Capital Gains and Losses and Built-in Gains
Form 8949, Sales and other Dispositions of Capital Assets
Form 8996, Qualified Opportunity Fund
Form 4797, Sales of Business Property
Schedule N, Foreign Operations of U.S. Corporations
Form 4136, Credit for Federal Tax Paid on Fuels
Form 8941, Credit for Small Employer Health Insurance Premiums
Form 5884-B, New Hire Retention Credit (Tax Periods 2010 and 2011)
Form 3800, General Business Credit (Tax Periods 202301 and later)
Form 8997, Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments
Form 8283, Noncash Charitable Contribution
Note:
Only the first form needs to be sequence in order and any additional forms can be attached after Form 4255 or as the last attachment in the package.
Form 6252, Installment Sale Income
Form 8936, Schedule A, Clean Vehicle Credit Amount (Tax Periods 202301 and later).
Form 4255, Certain Credit Recapture, Excessive Payments, and Penalties
Schedule K-1 (Form 1120-S), Shareholder’s Share of Income, Deductions, Credits, etc.
Note:
Place all Schedules K-1 (Form 1120-S), filed as attachments to Form 1120-S, as the last attachment in the package or follow local agreement. Detach Schedules K-1 for current year (TY2025), two preceding years (TY2024 and TY2023), and future Schedules K-1
Form 8938, Statement of Specified Foreign Financial Assets
Note:
Sequence Form 8938 to the back of the last page of Form 1120-S (after schedules and attachment pages), attaching the Form 8938 so that it is back-to-back with the parent return.
Note:
Form 8938 will only be sequenced if Form 8938 meets the requirements in IRM 3.11.217.46, Form 8938, Statement of Specified Foreign Financial Assets.
It is not necessary to sequence the forms or schedules listed above if there are no transcription line entries.
It is not necessary to sequence an Amended return. See IRM 3.11.217.3.9, Amended Returns, for more information.
3.11.217.15.2 (01-01-0226)
Positive/Negative Figures
Income Items - Lines 1a, 1b, 1c, 2, 3, 4, 5, and 6 can have positive or negative amounts.
Deduction Items - All lines in the deduction section can have positive or negative amounts.
Tax and Payment Items - Following lines are positive only amounts:
Line 23c - Total tax (Add Lines 23a and 23b)
Note:
2022 revision: Line 22c - Total tax
Line 24a - Current year’s estimated tax payments and preceding year’s overpayment credited to the current year
Note:
2022 revision: Line 23a - Estimated tax payments and overpayment credited
Line 24b - Tax Deposited with Form 7004
Note:
2022 revision: Line 23b - Tax Deposited with Form 7004
Line 24c - Credit for Federal Tax Paid on Fuels (attach Form 4136)
Note:
2022 revision: Line 23c - Credit for Federal Tax Paid on Fuels
Line 24d - Elective payment election amount from Form 3800
Line 24z - Total Payments (Add Line 24a through Line 24d)
Note:
Prior year line numbers: 2021 - 2022 revision: Line 23d - Total Payments, 2019 - 2020 revision: Line 23d - Reserved, 2018 revision: Line 23d - Refundable Credit from Form 8827; 2007 - 2017 revision: Line 23d - Total Payments.
Line 25 - Estimated Tax Penalty
Note:
2022 revision: Line 24 - Estimated Tax Penalty
Line 28a - Credit Elect Amount
Note:
2023 - 2024 Line 28 and 2021-2022 Line 27 - Credit Elect Amount
Do not bracket any negative entries on Lines 26, 27, and 28.
3.11.217.16 (01-01-2016)
Income Items - Lines 1 through 6, Page 1
- All line items are edited in dollars only and all the line items are either positive or negative.
3.11.217.16.1 (01-01-2023)
Line 1 - Gross Receipts or Sales
Line 1a is Gross Receipts or Sales and Line 1b is Returns and Allowances. Do not bracket or "X" amount on Line 1b if negative.
Edit Lines 1a, 1b, and 1c as follows:
If... And... Then... Line 1a is blank, Amounts are present on Line 1b or Line 1c, Add Line 1b and Line 1c and edit the total amount to Line 1a. Bracket if negative. Lines 1a, 1b, and 1c are blank, The taxpayer shows “Gross Profit” on Line 3, Add Lines 2 and 3 and edit the amount to Line 1a. Bracket if negative. ### Exception: If Line 2 is blank, determine from Form 1125-A, Line 8 amount, before computing Line 1a. If cost of goods sold is zero or blank on Form 1125-A, edit the Line 3 amount to Line 1a. Bracket if negative. Line 1b is blank, check attachments. If found, Edit the amount to Line 1b. Do not bracket if negative. Line 1b is blank, check attachments. If not found, Line 1a is greater than Line 1c, Compute Line 1b (Line 1a minus Line 1c) and edit the amount to Line 1b.
3.11.217.16.2 (01-01-2023)
Line 2 - Cost of Goods Sold
Follow instructions below for editing Cost of Goods Sold (Line 2):
If... And... Then... Line 2 is blank, An amount is present on Form 1125-A, Line 8, Edit the amount from Form 1125-A, Line 8. Bracket if negative. Line 2 is blank, Form 1125-A, Line 8 is blank and Line 6 has an entry, Edit the amount from Line 6, minus any amount on Line 7. Bracket if negative. Line 2 is blank, Form 1125-A, Lines 6 and 8 are blank and there are entries on Lines 1 through 5, Edit the total of Lines 1 through 5 minus any amount on Line 7. Bracket if negative.
3.11.217.16.3 (01-01-2026)
Line 4 - Net Gain (Loss)
Correspond with the taxpayer for the missing Form 4797, Sales of Business Property, if there is an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ on Line 4, Page 1 and Form 4797 is not attached.
Form 4797 is a transcribed form. Place Form 4797 in sequence order if significant entries are present on the following lines. See IRM 3.11.217.31, Form 4797, Sales of Business Property, for more information.
Note:
A significant entry is defined as any amount other than zero.
Line Line Description Year Revision 1a Gross Proceeds from Sales or Exchanges from Form(s) 1099-B or 1099-S 2025 and later 1b Total Amount of Gain from Partial Dispositions of MACRS Assets 2021 and later 1c Total Amount of Loss from Partial Dispositions of MACRS Assets 2021 and later 7 Total Gain or Loss Amount 2025 and later 8 Non-recaptured net Section 1231 Losses from Prior Years Amount 2025 and later 9 Total Gain Less Non-recapture Sect 1231 Losses Amount 2025 and later 17 Total Ordinary Gain or Loss Amount 2025 and later 18a Form 4684 Part 3 Property Held Total Loss Amount 2025 and later 18b Form 4797 Gain or Loss Minus F4684 Part 3 Property Held Total Loss Amount 2025 and later
3.11.217.16.4 (01-01-2016)
Line 5 - Other Income (Loss)
- Accept taxpayer's entry.
3.11.217.16.5 (01-01-2017)
Line 6 - Total Income (Loss)
Edit Line 6 as follows:
If... Then... Line 6 is blank, 1. Compute Lines 3 through 5 and edit to Line 6. ### Note: If Line 3 is blank, compute Line 3 by subtracting Line 2 from Line 1c. 2. Bracket if negative. Line 6 is the only entry in the Income Section, 1. Enter the amount from Line 6 to Line 5. 2. Bracket if negative.
3.11.217.17 (01-01-2024)
Deduction Items and Computation of Ordinary Income - Lines 7 through 22, Page 1
- This subsection provides instructions for editing the Deduction area of Form 1120-S, including the Salary and Wage Code. All line items are edited in dollars only and all the line items are positive or negative unless otherwise stated.
3.11.217.17.1 (01-01-2016)
Line 7 - Compensation of Officers
- Accept taxpayer's entry.
3.11.217.17.2 (01-01-2016)
Line 8 - Salaries and Wages
- Accept taxpayer's entry.
3.11.217.17.3 (01-01-2026)
Salary and Wage Code
Edit a "1" in the right margin of Page 1, Line 8 Form 1120-S if an entry greater than zero is present on any of the following:
Form 1120-S, U.S. Income Tax Return for an S Corporation, Page 1, Line 8.
Form 1125-A, Cost of Goods Sold, Line 3. See Figure 3.11.217-22, Example of Editing Salary and Wage Code from Form 1125-A.
Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation, Page 1, Line 13, Columns A through D or Page 2, Line 13, Columns E through H.
Schedule F, Profit or Loss From Farming, Line 22.
Form 4835, Farm Rental Income and Expenses (Crop and Livestock Shares (Not Cash) Received by Landowner (or Sub-Lessor)), Line 20, or
An attachment shows an entry for salaries, wages, labor, or payroll. See Figure 3.11.217-23, Example of Editing Salary and Wage Code from an Attachment.
Do not code for any of the following entries:
Contract, outside, custom, or miscellaneous labor
Temporary help
Management fees
Janitorial services
Maintenance fees
Commissions
Payroll taxes
Casual labor
Figure 3.11.217-22
This is an example of a completed Form 1120-S (Page 1 only). Form 1125-A, Cost of Goods Sold, is attached and includes an entry for cost of labor on Line 3. Form 1125-A, Cost of Goods Sold, is attached to Form 1120-SA text box located at the top of Form 1125-A reads: Edit the Salary and Wage Code “1” to Form 1120-S. There is an arrow pointing from the bottom of the text box to Line 3, Cost of labor, 581,900.Top left corner of Form 1120-S reads: DRAFTForm 1125-A, Name shows Cedar Chiropractic Clinic, PAForm 1125-A, Employer identification number shows 00-4551212Form 1125-A, Line 3, Cost of labor, shows 581,900Form 1120-S, Box A shows 1/01/1988 for the effective date of the S electionForm 1120-S, Box B shows 621310 for the Business Activity CodeForm 1120-S, Name line reads: Cedar Chiropractic Clinic, PA and CEDA is underlined as the name controlForm 1120-S, Address line reads: 361 Highway 12Form 1120-S, City, state, and ZIP code line reads: Tampa, FL 33602Form 1120-S, Box D shows 00-4551212 for the Employer Identification Number (EIN)Form 1120-S, Box E shows 10/30/1980 for the date incorporated.Form 1120-S, Box F shows $591,000 for Total AssetsForm 1120-S, Box I shows 2 for the Number of Shareholders during any part of the tax yearForm 1120-S, Line 1a, Gross receipts or sales, shows 1,145,500Form 1120-S, Line 1c, Balance, shows 1,145,500Form 1120-S, Line 3, Gross profit, shows 1,145,500Form 1120-S, Line 5, Other income (loss), shows 5,500Form 1120-S, Line 6, Total income (loss) shows 1,151,000Form 1120-S, Line 7, Compensation of officers, shows 144,500Form 1120-S, Line 8, Salaries and wages, shows a Salary and Wage Code 1 edited in red to the right of Line 8Form 1120-S, Line 9, Repairs and maintenance, shows 18,000Form 1120-S, Line 11, Rents, shows 30,200Form 1120-S, Line 12, Taxes and license, shows 67,050Form 1120-S, the IRS Received Date stamp shows:RECEIVED00103132026OGDEN, UTIRS-OSC
Please click here for the text description of the image.
Figure 3.11.217-23
This is an example of a completed Form 1120-S (Page 1 only). An attachment (Statement 1, Other deductions) includes an entry for Cost of Labor. The Salary and Wage Code 1 is edited to the right of Form 1120-S, Line 8.Top left corner of Form 1120-S reads: DRAFTBox A shows 05/05/97 for the effective date of the S electionBox B shows 598320 for the Business Activity CodeBox D shows 00-3367842 for the Employer Identification Number (EIN)Box E shows 01/01/97 for the date incorporated.Hemlock and Birch, Inc. is shown on the name line and HEML is underlined in red as the name control5484 Larch Ln. is shown for the street address lineRochester, NY 14603 is shown for the city, state, and ZIP code lineBox F shows $35,014 for Total AssetsBox I shows 3 for the Number of Shareholders during any part of the tax yearLine 1a, Gross receipts or sales, shows 27,554Line 1c shows 27,554Line 6 shows 27,554Salary and Wage Code 1 is edited in red to the right of Form 1120-S, Line 8To the left of Line 20 reads: See Statement 1Line 20, Other deductions, shows 14,055Line 21, Total deductions, shows 14,055Line 22, Ordinary business income (loss) shows 13,499An attachment (Statement 1, Other Deductions) is attached to Form 1120-S (below Line 1a) and includes an entry for Cost of Labor. The following items are shown on the attachment:Statement 1 (Other deductions)Advertising 2,898Meals and Entertainment 1,657Cost of Labor 5,035Repairs and Maintenance 4,465Totals 14,055
3.11.217.17.4 (01-01-2024)
Line 9 - Repairs and Maintenance
- Accept taxpayer's entry.
3.11.217.17.5 (01-01-2016)
Line 10 - Bad Debts
- Accept taxpayer's entry.
3.11.217.17.6 (01-01-2016)
Line 11 - Rents
- Accept taxpayer's entry.
3.11.217.17.7 (01-01-2024)
Line 12 - Taxes and Licenses
- Accept taxpayer's entry.
3.11.217.17.8 (01-01-2016)
Line 13 - Interest
- Accept taxpayer's entry.
3.11.217.17.9 (01-01-2022)
Line 14 - Depreciation
- Accept taxpayer's entry.
3.11.217.17.10 (01-01-2016)
Line 15 - Depletion
- Accept taxpayer's entry.
3.11.217.17.11 (01-01-2016)
Line 16 - Advertising
- Accept taxpayer's entry.
3.11.217.17.12 (01-01-2016)
Line 17 - Pension Profit Sharing Plan
- Accept taxpayer's entry.
3.11.217.17.13 (01-01-2024)
Line 18 - Employee Benefit Programs
- Accept taxpayer's entry.
3.11.217.17.14 (04-11-2024)
Line 19 - Energy Efficient Commercial Buildings Deduction (Form 7205) (202301 and later)
Accept taxpayer’s entry.
For prior years, Line 19 was used for other deductions.
Edit RPC "M" if Form 7205 is attached. See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information.
3.11.217.17.15 (01-01-2024)
Line 20 - Other Deductions
Edit Page 1, Line 20 as follows:
If... Then... If the taxpayer uses "Other Deduction" items on Lines 7 through 19, 1. Add the "Other Deduction" items and edit the total to Line 20. 2. Bracket if negative. 3. "X" the Other Deductions items from Lines 7 through 19. In prior years, Other Deductions were listed on line 19.
3.11.217.17.16 (01-01-2024)
Line 21 - Total Deductions
Edit Page 1, Line 21 as follows:
If... Then... Line 21 is blank, 1. Add Lines 7 through 20 and edit this amount to Line 21. 2. Bracket if negative. If Line 21 is the only entry in the "Deduction" section (Lines 7 through 21), 1. Edit the Line 21 amount to Line 20. 2. Bracket if negative. In prior years, Total Deductions were listed on line 20.
3.11.217.17.17 (01-01-2025)
Line 22 - Ordinary Business Income (loss)
Edit Page 1, Line 22 as follows:
If... Then... Line 22 is blank, Subtract Line 21 (Total Deductions) from Line 6 (Total Income) and edit this amount to Line 22. Bracket if negative. If Line 22 is the only entry on Page 1 of the return and the amount is positive, Edit the Line 22 amount to both Lines 5 and 6. If Line 22 is the only entry on Page 1 of the return and the amount is negative, Edit the Line 22 amount to both Lines 20 and 21 as a positive amount. Note:
Correspond with the taxpayer if ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ no Schedule K-1 is attached. See IRM 3.11.217.45, Schedule K-1.
Exception:
Do not correspond on Section 965 Returns. ERS will take care of any correspondence needed. See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information.
Note:
2022 and prior form revisions have line 20 as line 19.
In prior years, Ordinary Business Income was listed on line 21.
3.11.217.18 (08-11-2025)
Lines 23a -28,
Lines 22a - 27 (2022 & prior) - Tax and Payments Page 1
This subsection provides instructions for editing the Tax and Payments section of Form 1120-S.
2022 & prior, Tax and Payments were listed on Lines 22a through 27. If a significant amount is present, edit the line number to Line 23a.
Note:
A significant entry is defined as any amount other than zero (0).
3.11.217.18.1 (08-11-2025)
Line 23b,
Line 22b (2022 & prior) - Tax from Schedule D (Form 1120-S)
For 2022 and prior, Tax from Schedule D was listed on line 22b. If a significant amount is present, edit the line number to Line 23a.
Note:
A significant entry is defined as any amount other than zero (0).
If there is a significant entry on Line 23b and Schedule D, (Form 1120-S) Capital Gains and Losses and Built-in Gains, is not attached, correspond.
Note:
A significant entry is defined as any amount other than zero.
3.11.217.18.2 (08-11-2025)
Line 23c,
Line 22c (2022 & prior) - Total Tax
For 2022 and prior, Total Tax was listed on line 22c. If a significant amount is present, edit the line number to Line 23c.
Note:
A significant entry is defined as any amount other than zero (0).
Total Tax (Line 23c) can only be a positive amount. If blank, edit as follows:
If... Then... There is no entry on Line 23c (Total Tax), Compute and edit the total of Lines 23a and 23b to Line 23c (Total Tax). There is no entry on any of Lines 23a, 23b, and 23c (Total Tax), and Schedule D, (Form 1120-S) Capital Gains and Losses and Built-in Gains, is present, Edit the amount from Schedule D, Line 23 to Form 1120-S, Page 1, Line 23c. If Lines 23a and 23b are blank, and a significant amount is present on Line 23c (Total Tax), edit as follows:
If... Then... Line 23c includes pre-computed interest, delinquency penalty, or other charge, 1. "X" the Line 23c (Total Tax) amount. 2. Delete the interest, penalty, or other charge from the Total Tax. 3. Edit the correct Total Tax to the left of the original entry, if other than “0” (zero). Line 23c includes "Tax From Form 4255" , Certain Credit Recapture, Excessive Payments, and Penalties (or similar language), 1. Accept the taxpayer’s entry. 2. Do not correspond with the taxpayer for the missing Form 4255, Certain Credit Recapture, Excessive Payments, and Penalties, if not present. Line 23c includes "Last In First Out (LIFO) Tax" (or similar language), Accept the taxpayer’s entry. No supporting form, schedule, or statement is attached to explain the entry on Line 23c (Total Tax), Correspond with the taxpayer using Letter 118C, Corporate Return Incomplete for Processing: Form 1120, Form 1120 Series, Form 1120-S.
3.11.217.18.3 (08-11-2025)
Line 24a - Estimated Tax Payments
Accept taxpayer's entry.
For 2022 and prior year, Estimated Tax Payments are listed on line 23a. If a significant amount is resent, edit the line number to Line 24a.
Note:
A significant entry is defined as any amount other than zero (0).
3.11.217.18.4 (08-11-2025)
Line 24b
Line 24c (2022 & prior) - Tax Deposited with Form 7004
Accept taxpayer's entry.
For 2022 and prior, Tax Deposited with Form 7004 is listed on line 23b. If a significant amount is resent, edit the line number to Line 24b.
Note:
A significant entry is defined as any amount other than zero (0).
3.11.217.18.5 (08-08-2025)
Line 24c (2023 & later),
Line 23c (2022 & prior) - Credit for Federal Tax Paid on Fuels – Form 4136
For 2022 and prior the credit was listed on line 23c. If a significant amount is resent, edit the line number to Line 24c.
Note:
A significant entry is defined as any amount other than zero (0).
If Line 24c has a significant entry and Form 4136, Credit for Federal Tax Paid on Fuels, is not present, correspond with the taxpayer for the missing Form 4136.
Note:
A significant entry is defined as any amount other than zero.
3.11.217.18.6 (08-11-2025)
Line 24d (2023 & later) - Elective Payment Election Amount from Form 3800
If Line 24d has a significant entry and Form 3800, General Business Credit, is not present, correspond for the missing form.
For Tax Period 202201 - 202212, the Elective or Deemed Payment Election (DPE) and Credit Transfers was claimed on the dotted portion of line 23d:
Edit Line 23d to current year Line 24d, Form 1120-S.
≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
See IRM 3.11.217.2.12, Elective or Deemed Payment Election (DPE) and Credit Transfers.
3.11.217.18.7 (08-11-2025)
Line 23d (2020-2019) - Reserved
For 2020 - 2019 Line 23d was reserved. If Line 23d has a significant entry, then "X" the entry.
Note:
A significant entry is defined as any amount other than zero.
3.11.217.18.8 (08-11-2025)
Line 23d (2018) - Refundable Credit from Form 8827
- If the taxpayer shows a credit on Line 23d from Form 8827, Refundable Credit from Form 8827, must be attached to the return. If the form is not present, correspond for the missing form.
3.11.217.18.9 (08-11-2022)
Line 24z (2023 & later),
Line 23d (2022, 2021, 2017 & prior),
Line 23e (2018 - 2020) - Tax and Payments
Edit the line number for Total Payments to 2024 format according to the table below:
Form Year Form Line Number Edit to 2024 Form Line 2022, 2021, 2017 & prior 23d 24z 2020 - 2018 23e 24z For 2023 and later do the following:
If Line 24z is blank or illegible and there are entries on any of Lines 24a, 24b, 24c, or 24d, compute the total of Lines 24a, 24b, 24c and 24d and edit the total to Line 24z.
Note:
Line 24z is a new line on the 2023 revision of Form 1120-S, U.S. Income Tax Return for an S Corporation.
If Line 24z has an entry, but there are no entries on Lines 24a through Line 24d, double arrow or edit the amount to Line 24a.
For 2022, 2021, 2017 and prior do the following:
If original Line 23d is blank or illegible and there are entries on any of the original Lines 23a, 23b, and 23c, compute the total of Lines 23a, 23b, and 23c and edit the total to edited line number 24z.
If original Line 23d has an entry, but there are no entries on Lines 23a - 23c, double arrow or edit the amount to edit Line 24a.
For 2018 - 2020 do the following:
- If original Line 23e is blank or illegible and there are entries on any of the original Lines 23a, 23b, 23c, or 23d, compute the total of Lines 23a, 23b, 23c, and 23d and edit the total to edited line number 24z.
If original Line 23e has an entry, but there are no entries on Lines 23a through Line 23d, double arrow or edit the amount to edit line Line 24a.
3.11.217.18.10 (08-11-2025)
Line 25 (2023 & later),
Line 24 (2022 & prior) - Estimated Tax Penalty
Estimated Tax Penalty must be edited when either:
An additional penalty is pre-computed on the return, or
Form 2220, Underpayment of Estimated Tax by Corporations, is attached to the return, and shows liability for estimated tax penalty.
Estimated Tax Penalty is reported on line 25 (Line 24 for 2022 and prior), editing of the line numbers on prior year returns should be done to 2025 line number format according to the table below.
Form Year Form Line Number Edit to 2024 Form Line 2023 and later 25 No editing needed. 2022 and prior 24 25 To edit Form 1120-S, Line 25, do the following:
If the taxpayer follows the instructions on Form 2220, the applicable amount must be shown on Form 2220, Line 38*, and on Form 1120-S, Line 25. The taxpayer may have also increased Form 1120-S, Line 26 or decreased Form 1120-S, Line 27, accordingly. Do not adjust this amount.
If Form 1120-S, Line 25 is blank, edit the amount from Form 2220, Line 38, to Form 1120-S, Line 25.
If Form 1120-S, Line 25 is blank and Form 2220, Line 38 is also blank, review the Form 2220 to determine the taxpayer's method of computation. If there are entries on Form 2220, Line 37, Columns (a) - (d), compute the total amount and enter on Form 1120-S, Line 25.
Note:
If Form 2220 is attached, some conditions will require CCC "8" .
3.11.217.18.11 (08-11-2025)
Lines 26 and 27 - Amount Owed/Overpayment
Lines 26 and 27 are edited as positive only. If the taxpayer enters a negative amount, no action is required.
Edit the proper entry to Line 26 or Line 27 if both are blank. Do both of the following:
Add Lines 23c and 25. Subtract Line 24z (Prior year line numbers: 2022 - 2021 Form 1120-S revision: Line 23d, 2018 - 2020 revision: Line 23e; 2017 - 2007 revision: Line 23d).
Edit the positive result on Line 26 or the negative result (do not bracket) on Line 27.
If pre-computed interest, delinquency penalty, or other charge is evident, make sure that it has not been included in Line 25 or reduced Line 26.
If... Then... The amount on Line 26 has pre-computed interest, delinquency penalty, or other charge, 1. "X" Line 26 amount. 2. Delete the interest, penalty, or other charge from the amount owed. 3. Edit the correct amount owed to the left of the original entry. The amount on Line 27 is reduced by pre-computed interest, delinquency penalty, or other charge, 1. "X" Line 27 amount. 2. Compute the Overpayment amount without the interest, penalty, or other charge. 3. Edit the correct Overpayment to the left of the original entry. In prior years, Amount Owed/Overpayment is listed on lines 25 and 26.
3.11.217.18.12 (01-01-2026)
Lines 28b, 28c, & 28d - Direct Deposit Information
For Tax Year 2025 and later the Direct Deposit information is transcribed directly from Form 1120-S for the following lines:
Line Line Description 28c Routing Number 28d Type of Depositor Account 28e Depositor Account Number If data is present, take no action and continue to process the return.
3.11.217.18.13 (01-01-2022)
Backup Withholding
- If the taxpayer shows Backup Withholding, edit an X to the left of the amount and continue processing the return.
3.11.217.19 (01-01-2025)
♦Signature♦
A signature and jurat are required on all returns except the following:
Returns prepared under IRC 6020(b). These returns must be signed by a Compliance Function representative. See IRM 3.11.217.3.6.1, IRC 6020(b) Prepared by Collections.
Note:
Accept electronic or typed revenue officer (RO) signatures as valid on the return.
Returns prepared by Examination, for example Substitute for Return "SFR" or "SUBSTITUTE RETURN," See IRM 3.11.217.3.6.3, Examination Prepared.
Dummy returns prepared by the IRS.
Returns filed under IRC 501(d) (Religious or Apostolic Organization).
Returns attached to taxpayer response to the IRS correspondence containing a jurat and the taxpayer’s signature. See paragraph (5) below.
Re-entry returns originally electronically filed (E-File). These returns may be identified by the presence of Modernized E-file (MeF) printouts or "efile GRAPHIC print - Do Not Process" or "Tax Return Print (TRPRT) Do Not Process" (or similar language) in lieu of an actual return.
Note:
If the efile GRAPHIC print or TRPRT print says "efile GRAPHIC print - Do Not Process" or "TRPRT Print Do Not Process" in the top margin, circle the words "Do Not Process" .
Do not correspond for a signature on "CII" returns with Form 13596, Reprocessing Returns, attached. See IRM 3.11.217.3.4.3, Correspondence Imaging Inventory (CII) Returns, for processing instructions.
If a signature is missing, correspond.
Exception:
Do not correspond on Section 965 Returns. ERS will take care of any correspondence needed. See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information.
Note:
See IRM 3.11.217.3.4.2(2) - Issuing Correspondence - for returns that are incomplete and appear to be duplicate filings.
If... Then... * The return is not signed on the line designated for the taxpayer's signature, or * The jurat is not present on the line designated for the taxpayer's signature (a non-standard return), or * Only the entity information is present and there are no attachments containing tax data, 1. Edit Action Code 225 (Correspondence for Signature only) or 226 (International Correspondence for Signature only). 2. Leave in batch and continue editing. Note:
Paper returns sent in by the filer that says their return was rejected through the E-file system require a signature. Form 8879-CORP, E-file Authorization for Corporations is not an acceptable signature substitute for a paper return. Prior to Tax Year 2022 (process year 2023), Form 8879-S, e-file Signature Authorization for Form 1120-S, was used but the form is now retired.
If the jurat is altered or stricken (crossed out), see IRM 3.11.217.2.8, Frivolous Arguments, for frivolous return instructions.
Accept a signature declaration (a signature with jurat obtained through the IRS correspondence) if attached to the return.
If the "signature declaration" is altered or stricken (crossed out), see IRM 3.11.217.2.8, Frivolous Arguments, for frivolous return instructions.
If the taxpayer responds with a self-prepared "signature declaration" , it must contain the same language as the jurat on the tax return: e.g., "UNDER PENALTIES OF PERJURY, I DECLARE THAT I HAVE EXAMINED THIS RETURN INCLUDING ACCOMPANYING SCHEDULES AND STATEMENTS, AND TO THE BEST OF MY KNOWLEDGE AND BELIEF, IT IS TRUE, CORRECT, AND COMPLETE."
Form 8879-CORP, E-file Authorization for Corporations, is not an acceptable signature substitute for a paper return.
Note:
Prior to Tax Year 2022 (process year 2023), Form 8879-S, e-file Signature Authorization for Form 1120-S, was used but the form is now retired.
Tax examiners are not handwriting experts. 26 Code of Federal Regulations (CFR) 301.6064-1 allows the IRS to presume that the signature on the return, statement, or other document is the true signature of the person who signed the document.
Note:
Do not accept a “✓” or “X” on the signature line as a valid taxpayer signature.
The following types of signatures are not valid for Form 1120-S:
Faxed signatures
Exception:
Tax return information can be received via fax as part of return perfection even if a taxpayer signature is required. In circumstances where contact with the taxpayer was made and documented, faxed signatures are acceptable.
Electronic signatures
Docusign signatures
Typed font signatures
Exception:
Starting July 1, 2013, the revenue officer's (RO's) electronic signature or typed signature will be accepted as a valid signature on the return.
Correspond one time for the signature.
3.11.217.20 (01-01-2022)
♦Paid Preparer Checkbox Indicator♦
The Paid Preparer Checkbox is next to the taxpayer signature area. It shows whether the taxpayer has elected to allow the Paid Preparer to answer questions about the return as it is processed.
No action is required on Amended returns.
Take the following actions when an entry is present in the Paid Preparer Checkbox:
If... Then... Only the "Yes" box is checked, Take no action. * "No" box is checked * Neither box is checked or * Both boxes are checked Circle the Paid Preparer's Telephone Number if present.
3.11.217.21 (01-01-2019)
♦Paid Preparer Section♦
- The Paid Preparer section is below the Signature area at the bottom of Form 1120-S, U.S. Income Tax Return for an S Corporation.
3.11.217.21.1 (01-01-2023)
♦Paid Preparer's Tax Identification Number (PTIN)♦
The Preparer's Tax Identification Number (PTIN) is to the right of the Preparer's Signature in the PTIN Box at the bottom right margin of Form 1120-S, Page 1.
No action is required on Amended returns.
A valid PTIN begins with the alpha "P" followed by an eight-digit number (e.g., PXXXXXXXX). Circle the PTIN if invalid, all zeros or all nines.
3.11.217.21.2 (01-01-2019)
♦Firm’s Employer Identification Number (EIN)♦
The Firm's EIN is located below the Preparer's PTIN Box at the bottom right margin of Form 1120-S, Page 1.
No action is required on amended returns.
The Firm's EIN is a nine-digit number. Circle the EIN if it is invalid, all zeros or all nines.
3.11.217.21.3 (01-01-2019)
♦Paid Preparer Telephone Number♦
The Paid Preparer's Phone Number is below the Paid Preparer's EIN at the bottom right corner of Form 1120-S, Page 1.
If... Then... The return is amended, No action is required. The Preparer's Phone Number is more than 10 digits, No action is required. The Preparer's Phone Number is illegible or less than 10 digits, Circle the Phone Number.
3.11.217.22 (01-01-2016)
Schedule A - Cost of Goods Sold (2010 and prior revisions)
Schedule A was replaced with Form 1125-A, Cost of Goods Sold.
See IRM 3.11.217.34, Form 1125-A, Cost of Goods Sold, for processing instructions of prior year returns containing a Schedule A.
3.11.217.23 (01-01-2019)
Schedule B - Other Information
- This subsection provides instructions for editing Schedule B, Other Information, on Form 1120-S.
3.11.217.23.1 (01-01-2022)
Accounting Method Code
The Accounting Method Code is transcribed from the taxpayer’s response to the boxes on Form 1120-S, Schedule B, Line 1.
No editing is required.
3.11.217.23.2 (01-01-2022)
Form 8996 - Qualified Opportunity Fund Checkbox
If Form 1120-S, Schedule B, Question 15 "Is the corporation attaching Form 8996, Qualified Opportunity Fund, to certify as a Qualified Opportunity Fund" is answered "Yes" and the amount line is blank, search attachments for Form 8996. If Form 8996 is attached with an amount on Line 15 (Form 8996 prior year revision line numbers: 2020: Line 14, 2018: Line 13), then edit the amount to Schedule B, Question 15.
Note:
Edit this amount using dollars and cents.
If Form 8996, Qualified Opportunity Fund, is attached, edit Return Processing Code (RPC) 6 to Page 1, in the right margin next to Line 1c (Total, Add Lines 1a and 1b) of Form 1120-S. See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information.
See IRM 3.11.217.33, Form 8996, Qualified Opportunity Fund, for more information.
3.11.217.23.3 (01-01-2024)
Digital Asset Checkbox
Form 1120-S, Schedule B, line 16 has a checkbox regarding Crypto Currency Reporting for tax periods ending 202301 and subsequent.
The valid characters for the checkbox field (listed in the table below) are 0,1,2, and 3. Data will enter:
Character Description 0 No boxes checked 1 "Yes" box checked 2 "No" box checked 3 Both boxes checked
3.11.217.24 (01-01-2025)
Schedule K - Shareholders' Pro Rata Share Items
This subsection provides instructions for editing Schedule K, Shareholders' Pro Rata Share Items, on Form 1120-S.
Correspond for Schedule K if missing or blank unless the return meets any of the following conditions:
The tax period 201412 and prior.
Attached Schedule K-1 (Form 1120-S), Part III, has no tax data or reports only Ordinary Income, on Line 1.
Any of the following are attached:
Schedule D, (Form 1120-S) Capital Gains and Losses and Built-in Gains
Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation
Form 6478, Biofuel Producer Credit
Form 4797, Sales of Business Property
Form 4562, Depreciation and Amortization (Including Information on Listed Property)
Form 3468, Investment CreditThe return is for a short period.
The return has no significant entries or is blank.
Note:
A significant entry is defined as any amount other than zero.
3.11.217.24.1 (01-01-2023)
Line 2, Schedule K - Net rental real estate income (loss)
Correspond with the taxpayer for Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation, if the amount on Form 1120-S, Page 3, Schedule K, Line 2 is either ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and Form 8825 is not attached.
For processing of Form 8825, see IRM 3.11.217.28, Form 8825 - Rental Real Estate Income and Expenses of a Partnership or an S Corporation.
3.11.217.24.2 (01-01-2016)
Line 4, Schedule K - Interest income
If Form 1120-S, Schedule K, Line 4, Interest income, is blank check the supporting attachments for Portfolio Income. If an amount is present, edit to Line 4.
Bracket if negative.
3.11.217.24.3 (01-01-2022)
Line 10, Schedule K - Other income (loss)
If Form 1120-S, Schedule K, Line 10, Other income (loss), reflects a loss ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ edit Audit Code "5" in the left margin near Line 9 (Deductions area). See IRM 3.11.217.13.1, Audit Codes, for more information.
If Form 1120-S, Schedule K, Line 10, Other income (loss) shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions), edit Computer Condition Code (CCC) "J" and Action Code 460 (Management Suspense). This instruction is only valid for Tax Periods 201712 - 202012.
Note:
A significant entry is defined as any amount other than zero.
Form 1120-S, Schedule K-1, Box 10, with Code F (202012 - 201712 form revisions) may show a Section 965(a) return. See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedules K-1. This instruction is only valid for Tax Periods 201712 - 202012.
See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), IRM 3.11.217.14.7, CCC "J" - Section 965 Tax, and IRM 3.11.217.3.1, Action Codes, for more information. This instruction is only valid for Tax Periods 201712 - 202012.
3.11.217.24.4 (01-01-2022)
Line 12d, Schedule K - Other deductions
If Form 1120-S, Schedule K, Line 12d, Other deductions, shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions), edit Computer Condition Code (CCC) "J" and Action Code 460 (Management Suspense). This instruction is only valid for Tax Periods 201712 - 202012.
Note:
A significant entry is defined as any amount other than zero.
Form 1120-S, Schedule K-1, Box 12, with Code K (202012 - 201712 form revisions) may show a Section 965(c) return. See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedules K-1. This instruction is only valid for Tax Periods 201712 - 202012.
See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), IRM 3.11.217.14.7, CCC J - Section 965 Tax, and IRM 3.11.217.3.1, Action Codes, for more information. This instruction is only valid for Tax Periods 201712 - 202012.
3.11.217.24.5 (01-01-2019)
Line 13a, Schedule K -
Low-income housing credit (section 42(j)(5))
If Form 1120-S, Schedule K, Line 13a, Low-income housing credit (section 42(j)(5)), has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, Form 8586 is required.
If... Then... Form 8586 is attached, See IRM 3.11.217.13.5, Form 8586, Low-Income Housing Credit. Form 8586 is not attached, Correspond with the taxpayer for the missing Form 8586.
3.11.217.24.6 (01-01-2019)
Line 13b, Schedule K -
Low-income housing credit (other)
If Form 1120-S, Schedule K, Line 13b, Low-income housing credit (other), has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, Form 8586 is required.
If... Then... Form 8586 is attached, See IRM 3.11.217.13.5, Form 8586, Low-Income Housing Credit. Form 8586 is not attached, Correspond with the taxpayer for the missing Form 8586.
3.11.217.24.7 (01-01-2023)
Line 13f, Schedule K - Biofuel producer credit
If Form 1120-S, Schedule K, Line 13f, Biofuel producer credit, has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, Form 6478, Biofuel Producer Credit, (Credit for Alcohol Used as Fuel, for 2012 - 2007), is required. If Form 6478 is not attached, correspond with the taxpayer for the missing form.
Check Form 6478, Line 4 against Schedule K, Line 13f.
If the amounts agree, continue processing the return.
If there is a discrepancy, edit the amount from Form 6478, Line 4 to Schedule K, Line 13f.
3.11.217.24.8 (03-06-2025)
Line 13g, Schedule K - Other credits
If Form 1120-S, Schedule K, line 13g, Other credits, has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡, a statement or a supporting form for the credit being claimed must be attached:
If... And... Then... If the credit type is identified, The supporting form or a statement is attached to support the credit claimed, Take no action and allow the amount for the credit being claimed. If the credit type is identified, The supporting form or a statement is not attached to support the credit claimed, Correspond using Letter 118C, Corporate Return Incomplete for Processing: Form 1120, Form 1120 Series, Form 1120-S, for the missing form. If the credit type is not identified, The supporting form or a statement is not attached to support the credit claimed, Correspond using Letter 118C, Corporate Return Incomplete for Processing: Form 1120, Form 1120 Series, Form 1120-S, for the type of credit being claimed and supporting form for the credit being claimed. If Schedule K, line 13g, Other credits, has an entry for Form 8936, Schedule A, Clean Vehicle Credits:
If... Then... Form 8936, Schedule A, Clean Vehicle Credits, is attached, 1. If the Tax Period is 202301 and later, Take no action and allow the credit claimed. 2. If the Tax Period is prior to 202301, edit as asterisk (\*) to left of the entry. Form 8936, Schedule A, Clean Vehicle Credits, is not attached, Correspond using Letter 118C, Corporate Return Incomplete for Processing: Form 1120, Form 1120 Series, Form 1120-S, for the missing form.
3.11.217.24.9 (01-01-2023)
Line 14, Schedule K - International Checkbox
- Line 14 - No editing is required. Accept taxpayer’s entry.
3.11.217.24.10 (01-01-2022)
Line 16f, Schedule K - Foreign taxes paid or accrued
If Form 1120-S, Schedule K, Line 16f*, Foreign taxes paid or accrued, has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, edit an Audit Code "2" in the left margin near Line 9 (Deductions area) *(Schedule K prior year line numbers: 2020 - 2018: Line 14p, 2017 - 2004: Line 14l). See IRM 3.11.217.13.1, Audit Codes.
If Form 1120-S, Schedule K, Line 16f*, Foreign taxes paid or accrued, has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, edit an Audit Code "7" in the left margin near Line 9 (Deductions area). *(Schedule K prior year line numbers: 2020 - 2018: Line 14p, 2017 - 2004: Line 14l.) See IRM 3.11.217.13.1, Audit Codes.
3.11.217.24.11 (01-01-2022)
Line 14r, Schedule K - Other foreign tax information
These instructions are only valid for Tax Periods 201712 - 202012.
If Form 1120-S, Schedule K, Line 14r, Other foreign tax information, shows a significant entry with the notation "Section 965" or similar language (202012 - 201712 form revisions), edit Computer Condition Code (CCC) "J" and Action Code 460 (Management Suspense).
Note:
A significant entry is defined as any amount other than zero.
Form 1120-S, Schedule K-1, Box 14, with Code U (202012 - 201712 form revisions) may show a Section 965 return. See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedules K-1.
See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), IRM 3.11.217.14.7, CCC J - Section 965 Tax, and IRM 3.11.217.3.1, Action Codes, for more information.
3.11.217.24.12 (01-01-2019)
Line 16d, Schedule K - Distributions
- Accept taxpayer's entry.
3.11.217.24.13 (01-01-2026)
Line 17d, Schedule K - Other items and amounts
If Form 1120-S, Schedule K, Line 17d, Other items and amounts, shows a significant entry with the notation "Section 965" or similar language and the Tax Period is 201712 - 202012, edit Computer Condition Code (CCC) "J" and Action Code 460 (Management Suspense).
Form 1120-S, Schedule K-1, Box 17, with Code AD may show a Section 965 return. See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedules K-1.
3.11.217.24.14 (01-01-2022)
Line 18, Schedule K - Income/loss reconciliation
- Accept taxpayer's entry on Form 1120-S, Schedule K, Line 18.
3.11.217.25 (01-01-2024)
Schedule L - Balance Sheets per Books
Correspond with the taxpayer for missing or blank Schedule L, Balance Sheets per Books, unless the return meets any of the following conditions:
Tax periods 0712 and prior.
Amended return (CCC "G" ).
Final return.
Page 2, Schedule B, Line 11 (prior years: 2017 - 2012: Line 10) is checked "Yes" .
Note:
If both the "Yes" box and the "No" box are checked, or neither box is checked, and none of the conditions in the bullets listed here are met, correspond.
There are no significant entries on Page 1, Lines 1 through 22 (Lines 1 through 20 2022 prior year form revision).
Note:
A significant entry is defined as any amount other than zero.
Page 1, Box F, Total assets and Line 1a, Gross receipts or sales, have a "-" (dash), "None" , "N/A" , or some similar entry or is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
Schedule L is crossed out or annotated "0" (zero), "-" (dash), "None" , "N/A" , or some similar entry.
Schedule B, Line 1 (Check accounting method) - The "Cash" box on Schedule B is checked or the taxpayer has notated "Single Entry Records" , "See Books" , "Balance Sheet not available" , or similar entry.
If the "Yes" box on Form 1120-S, Schedule B, Line 11* is checked and Total assets, (Page 1, Box F)** ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡and Gross receipts or sales, (Page 1, Line 1a)*** ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, delete (slash (/)) Schedule L. (For example, if either "Total assets" or "Gross receipts or sales" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, donot delete Schedule L, Balance Sheets per Books.)
*Schedule B, Line 10 (prior years: 2017 - 2012: Line 10).
**Page 1, Box F.
***Page 1, Line 1a.Reminder:
Edit Total Assets, Page 1, Box F per IRM 3.11.217.10, Total Assets-Page 1, Box F.
The following information is transcribed from Form 1120-S, Page 4, Schedule L, Balance Sheets per Books. No action is necessary to perfect these amounts. Accept the taxpayer's entry:
Loans to Shareholders, end of year. Schedule L, Line 7 (d).
Total Assets, beginning of year. Schedule L, Line 15 (b).
Loans from Shareholders, end of year. Schedule L, Line 19 (d).
Capital Stock, end of year. Schedule L, Line 22 (d).
Additional Paid-In Capital, end of year. Schedule L, Line 23 (d).
Retained Earnings, end of year. Schedule L, Line 24 (d).
3.11.217.26 (01-01-2019)
Schedule M-1 and Schedule M-2
- This subsection provides instructions for Form 1120-S, Schedule M-1, Reconciliation of Income (Loss), and Schedule M-2, Analysis of Accumulated Adjustments Account.
3.11.217.26.1 (01-01-2016)
Schedule M-1 - Reconciliation of Income (Loss)
The following information is transcribed from Schedule M-1, Reconciliation of Income (Loss), Form 1120-S, Page 5 (Page 4 for prior years).
Schedule M-1, Line 3(b) - Travel and Entertainment. Accept taxpayer's entry.
3.11.217.26.2 (01-01-2016)
Schedule M-2 - Analysis of Accumulated Adjustments Account
The following information is transcribed from Schedule M-2, Analysis of Accumulated Adjustments Account, Form 1120-S, Page 5 (Page 4 for prior years).
Schedule M-2, Line 1, Column (a) - Balance at beginning of tax year. Accept taxpayer's entry.
3.11.217.27 (01-01-2022)
Schedule N (Form 1120) - Foreign Operations of U.S. Corporations
Schedule N is valid for tax periods beginning 01-01-2000. Delete Schedule N if the tax period begins before 01-01-2000.
S Corporations that, at any time during the tax year, have assets in or operate a business in a Foreign Country or U.S. possession may have to file Schedule N.
Do not correspond if Schedule N is missing. Dummy a Schedule N and edit the applicable entries when Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships, Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations, or Form 8873, Extraterritorial Income Exclusion, is attached to the tax return.
If Schedule N is present and has no entries, do not correspond.
If more than one Schedule N is attached, combine the information from all Schedules N, including all subsidiaries and:
Edit to the first Schedule N that has the EIN of the return being processed. "Staple up" any remaining Schedules N, or
Dummy and edit Schedule N, for the parent return if one is not present on a consolidated return.
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Schedule N.
3.11.217.27.1 (01-01-2022)
Line 1a, Schedule N (Form 1120) - Form 8858, Information Return of U.S. Persons With Respect to Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs)
Form 8858 (Revision 12-2018), Information Return of U.S. Persons With Respect To Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs), must be filed by U.S. persons with respect to FDEs and FBs. Also, Form 8858 (Revision 12-2018) must be filed by U.S. persons with respect to FDEs and FBs owned by certain controlled foreign corporations or controlled foreign partnerships.
Edit Audit Code "2" if:
Schedule N (Form 1120), Question 1a is answered "Yes" , or
Form 8858 is present.
3.11.217.27.2 (01-01-2016)
Line 2, Schedule N (Form 1120) - Number of Forms 8865
No entry is required for Schedule N, Line 2 unless Form 8865 is present.
Edit Line 2 as follows:
If... And... Then... A number is present for Schedule N, Line 2, Take no further action. Schedule N, Line 2 is blank, Form(s) 8865 is attached, Edit the number of Forms 8865 in the dotted line area of Line 2. Form 8865 is attached, Schedule N is not present, Dummy a Schedule N and edit the number of Forms 8865 to Schedule N, Line 2. Edit Audit Code "2" if Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships, is attached. See IRM 3.11.217.13.1, Audit Codes.
3.11.217.27.3 (01-01-2016)
Line 3, Schedule N (Form 1120) - Form 8865 Question
- Edit Audit Code "2" if Schedule N (Form 1120), Question 3 is answered "Yes" or Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships, is attached. See IRM 3.11.217.13.1, Audit Codes.
3.11.217.27.4 (01-01-2022)
Lines 4a and 4b, Schedule N (Form 1120)- Form 5471, Controlled Foreign Corporation
Line 4a is "Reserved for future use" .
- For prior year returns (2020 and prior revisions), edit Audit Code "2" if Schedule N, Question 4a is answered "Yes" .
Line 4b - Edit Audit Code "2" if Form 5471 is attached. See IRM 3.11.217.13.1, Audit Codes.
No entry is required for Schedule N, Line 4b unless Form 5471 is present.
Edit Line 4b as follows:
If... And... Then... A number is present for Schedule N, Line 4b, Take no further action. Schedule N, Line 4b is blank, Form(s) 5471 is attached, Edit the number of Forms 5471 in the dotted line area of Line 4b. ### Note: Document Perfection is responsible for determining the number of all Form(s) 5471 received, whether attached to a parent return in a consolidated group or found as an attachment to a subsidiary return. Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations, is attached, Schedule N is not present, Dummy a Schedule N and edit the number of Forms 5471 to Schedule N, Line 4b.
3.11.217.27.5 (01-01-2016)
Line 5, Schedule N (Form 1120) - Form 3520 Question
- Edit Audit Code "2" if Schedule N (Form 1120), Question 5 is answered "Yes" . See IRM 3.11.217.13.1, Audit Codes.
3.11.217.27.6 (01-01-2016)
Line 6b, Schedule N (Form 1120) - Foreign Country Code
Edit Schedule N (Form 1120), Line 6b as follows:
If... And... Then... The taxpayer has entered the name of a Foreign Country in Line 6b, Write the two letter Country Code to the left of Line 6b. See Acceptable Foreign Countries in Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries. ### Exception: Edit Other Country Code "OC" if the foreign country is not listed in Document 7475. ### Note: Use "UK" for England, Northern Ireland, Scotland, and Wales. Also, "Holland" is not an official country name, but is part of The Netherlands. No Foreign Country is present or "US" , "USA" , "America" , or similar reference to the United States is present, Question 6a is checked "Yes" , Edit Other Country Code, "OC" . More than one Foreign Country is present, Edit the Country Code of the first Foreign Country shown.
3.11.217.27.7 (01-01-2016)
Line 7a, Schedule N (Form 1120) - Form 8873 Question
- Edit Audit Code "2" if Schedule N (Form 1120), Question 7a is answered "Yes" . See IRM 3.11.217.13.1, Audit Codes.
3.11.217.27.8 (01-01-2022)
Line 7b, Schedule N (Form 1120) - Number of Forms 8873
No entry is required for Schedule N (Form 1120), Line 7b unless Form 8873, Extraterritorial Income Exclusion, is present.
Note:
Input of Command Code (CC) REQ77 / FRM77 with IDRS Transaction Code (TC) "971" and correct IDRS Action Code (depending on which election was made) may be needed with the Form 8873. See IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion.
Edit Line 7b as follows:
If... And... Then... A number is present for Schedule N, Line 7b, Form(s) 8873 is attached, Process Form 8873, Extraterritorial Income Exclusion, per IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion. A number is present for Schedule N, Line 7b, Form(s) 8873 are not attached, Take no further action. Schedule N, Line 7b is blank, Form(s) 8873 is attached, 1. Edit the number of Forms 8873 in the dotted line area of Line 7b. 2. Process Form 8873 per IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion. Form 8873 is attached, Schedule N is not present, 1. Dummy a Schedule N and edit the number of Forms 8873 to Line 7b of Schedule N. 2. Process Form 8873 per IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion.
3.11.217.27.9 (01-01-2022)
Line 7c, Schedule N (Form 1120) - Total Extraterritorial Income Exclusion
No entry is required for Schedule N (Form 1120), Line 7c unless Form 8873 is present.
Edit Line 7c as follows:
If... And... Then... An amount is present for Schedule N, Line 7c, Form 8873 is attached, Process Form 8873 per IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion. An amount is present for Schedule N, Line 7c, Form 8873 is not attached, Take no further action. Schedule N, Line 7c is blank, Form(s) 8873 is attached, 1. Compute the total amount of extraterritorial income exclusion from Line 52 and edit to the area provided on Line 7c. 2. Process Form 8873 per IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion. Form 8873 is present with a significant entry on Line 52. ### Note: A significant entry is defined as any amount other than zero. Schedule N is not attached, 1. Dummy a Schedule N and compute the total amount of extraterritorial income exclusion from all attached Forms 8873. Edit the total to the area provided on Schedule N, Line 7c. 2. Process Form 8873 per IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion. Note:
Input of Command Code (CC) REQ77 / FRM77 with IDRS Transaction Code (TC) "971" and correct IDRS Action Code (depending on which election was made) may be needed with the Form 8873. See IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion.
3.11.217.27.10 (01-01-2025)
Line 8, Schedule N (Form 1120) - Statement of Specified Foreign Financial Assets
- For Tax Year (TY) 202201 and later, Form 8938, Statement of Specified Foreign Financial Assets, will be transcribed into the General Purpose Programming (GPP) database. If Form 8938 is attached, see IRM 3.11.217.46, Form 8938, Statement of Specified Foreign Financial Assets, for more information.
3.11.217.28 (01-01-2026)
Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation
If Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation, is attached to Form 1120-S, compute Line 20a (18a 2024 and prior), Total Gross Rents, when there are entries on Page 1, Lines 2a, 2b, or 2c (Line 2, 2024 and prior), Columns A through D or Page 2, Lines 2a, 2b, or 2c (Line 2, 2024 and prior), Columns E through H. Edit Form 8825 in positive amounts in dollars only as follows:
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 8825.
If... And... Then... Only one Form 8825 is attached, Line 20a (18a 2024 and prior) is negative, "X" the negative amount. Only one Form 8825 is attached, Line 20a (18a 2024 and prior) is blank, Compute and enter a positive amount on Line 20a (18a 2024 and prior). See Figure 3.11.217-24, Example of Editing Form 8825. Multiple Forms 8825 are attached, Only one Form 8825 has an entry on Line 20a (18a 2024 and prior), 1. Accept positive taxpayer entry ("X" negative amount). 2. Place Form 8825 in sequence order if Line 20a (18a 2024 and prior) has a positive amount. 3. "X" the remaining Form 8825. Multiple Forms 8825 are attached, More than one Form 8825 has an entry on Line 20a (18a 2024 and prior) or Line 20a (18a 2024 and prior) is blank, 1. Add all Form 8825, Lines 2a, 2b, or 2c (Line 2, 2024 and prior) amounts together. 2. If positive, edit the amount(s) to Line 18a of the first Form 8825. 3. "X" the remaining Forms 8825. 4. Place edited Form 8825 in sequence order. Figure 3.11.217-24
This is an example of a completed Form 8825, Rental Real Estate Income and Expenses of a Partnership or an S Corporation. A text box located at the top of Form 8825 reads: Compute Line 20a of Form 8825Name line shows Oak, Hickory, and Birch PA.Employer identification number shows 00-9914561Line 1, A shows Office Bldg. 410 Willow Ave Los Angeles, CA, 90052Line 1, B shows Office Space 450 Poplar BlvdSan Francisco, CA, 94101Line 1, C shows Office Bldg. 12458 Chestnut WayAnaheim, CA, 92803Line 2, Gross rents, shows Column A: 12,500.00; Column B: 10,000.00; Column C: 2,500.00Form 8825, Line 20a was blank.Line 20a is computed by adding Line 2, Column A amount of 12,500.00, Line 2, Column B amount of 10,000.00, and Line 2, Column C amount of 2,500.00. The sum of 25000 is edited to Line 20a, Total gross rents.
3.11.217.29 (01-01-2022)
Form 8873, Extraterritorial Income Exclusion
Document Perfection is responsible for processing Part I, Elections and Other Information of Form 8873. Elections are identified by inputting Command Code (CC) REQ77 / FRM77 with Transaction Code (TC) 971 and IDRS Action Code 361, 362, or 363 depending on which election was made.
Note:
"Action Codes" referenced in the Form 8873 instructions are IDRS Action Codes, not to be confused with ERS Action Codes.
If Part I, Lines 1 through 3 of the Form 8873, are not checked, then no "TC 971" needs to be entered on IDRS.
3.11.217.29.1 (01-01-2016)
Form 8873, Line 1 - Section 942(a) (3) Election
If the box is marked for Part 1, Line 1 of Form 8873, enter "TC 971" with IDRS Action Code 361. Use the current date for the Effective Date.
Note:
Edit Action Trail (e.g., "TC 971-361" or similar language) in the lower left margin going vertically up the side of the return.
3.11.217.29.2 (01-01-2016)
Form 8873, Line 2 - Extraterritorial Income Exclusion in Lieu of Election
If the box is marked for Part I, Line 2 of Form 8873, enter "TC 971" with IDRS Action Code 362. Use the current date for the Effective Date.
Note:
Edit Action Trail (e.g., "TC 971 - 362" or similar language) in the lower left margin going vertically up the side of the return.
3.11.217.29.3 (01-01-2016)
Form 8873, Line 3 - Domestication Election
If the box is marked for Part I, Line 3 of Form 8873, enter "TC 971" with IDRS Action Code 363. Use the current date for the Effective Date.
Note:
Edit Action Trail (e.g., "TC 971 - 363" or similar language) in the lower left margin going vertically up the side of the return.
3.11.217.30 (01-01-2026)
Schedule D (Form 1120-S), Capital Gains and Losses and Built-in Gains
Edit Schedule D, (Form 1120-S) Capital Gains and Losses and Built-in Gains:
If... Then... All of the following conditions apply: 1. Form 1120-S is for 201212 tax year or later and 2. The Schedule D is a 2012 or later revision and 3. Significant entries are present on one or more of the transcription lines or checkbox is marked. ### Note: A significant entry is defined as any amount other than zero. * Transcription lines for 2019 and subsequent are as follows: * Checkbox above Part I, ### Note: Valid for tax periods ending 201712 and later. * Part I, Line 1a, Columns (d) and (e), * Part I, Lines 1b - 3, Columns (d), (e) and (g), * Part 1, Line 5 (2025 and later) * Part II, Lines 8a, Columns (d) and (e), * Part II, Lines 8b - 10, Columns (d), (e) and (g), * Part II, Line 13. * Transcription lines for 2018 through 2013 are as follows: * Part I, Line 1a, Columns (d) and (e), * Part I, Lines 1b - 3, Columns (d), (e), and (g) * Part II, Lines 8a, Columns (d) and (e), * Part II, Lines 8b - 10, Columns (d), (e), and (g), * Line 13. 1. Place Schedule D in sequence order. 2. Edit Schedule D in dollars only. 3. For 2013 and later Schedule D revisions: * "X" any negative transcription entries, except the following: Lines 1b(g), 2(g), 3(g), 8b(g), 9(g), and 10(g). These lines can be positive or negative. 4. For 2012 Schedule D revisions: * "X" any negative transcription entries. * Change Page 1, Part I, Line 1 to Line 1b and, * Change Page 1, Part II, Line 8 to Line 8b. Criteria above is not met, Cross-out or slash Schedule D. ### Exception: If Form 1120-S, Page 1, Line 23b (22b on prior form revisions) has a significant entry, do not cross-out or slash Schedule D. Continue processing the return. See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Schedule D.
3.11.217.31 (01-01-2026)
Form 4797, Sales of Business Property
The following are transcribed from Form 4797, Sales of Business Property and no editing is required:
Place Form 4797, Sales of Business Property, in sequence order if significant entries are present on the following lines. See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 4797.
Note:
A significant entry is defined as any amount other than zero.
Note:
See IRM 3.11.217.16.3, Line 4 - Net Gain (Loss), for more information.
Line Line Description Valid Tax Year 1a Gross Proceeds from Sales or Exchanges from Form(s) 1099-B or 1099-S 202501 and later 1b Total Amount of Gain from Partial Dispositions of MACRS Assets All Years 1c Total Amount of Loss from Partial Dispositions of MACRS Assets All Years 7 Total Gain or Loss Amount 202501 and later 8 Non-recaptured net Section 1231 Losses from Prior Years Amount 202501 and later 9 Total Gain Less Non-recapture Sect 1231 Losses Amount 202501 and later 17 Total Ordinary Gain or Loss Amount 202501 and later 18a Form 4684 Part 3 Property Held Total Loss Amount 202501 and later 18b Form 4797 Gain or Loss Minus F4684 Part 3 Property Held Total Loss Amount 202501 and later
3.11.217.32 (01-01-2025)
Form 8949, Sales and Other Dispositions of Capital Assets
Form 8949, Sales and other Dispositions of Capital Assets is valid for tax periods 201712 and later. See Figure 3.11.217-25, Example of Editing Form 8949.
If the taxpayer has entered a "Z" or "Y" in any of the rows in either Part I, Line 1, Column (f), or Part II, Line 1, Column (f), of Form 8949, then edit CCC "M" .
If the taxpayer has entered a "Z" in any of the rows from Part I, Line 1, Column (f), then edit Form 8949 as follows:
Place Form 8949 in sequence order if significant entries are present. See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S. If there is more than one Form 8949 attached, then sequence the Form 8949 with the Part I edited data first.
Underline the EIN (Column (a)) from the first row with a "Z" present in Column (f) if EIN is present.
Underline the Date Acquired (Column (b)) from the first row with a "Z" present in Column (f) if the day, month, and year are present.
Underline the dollar amount (Column (g)) from the first row with a "Z" present in Column (f) if the money amount is present.
If the taxpayer has shown more than one row with a "Z" in Column (f), then edit "Z-1" to the right margin of Part I, Line 1 of Form 8949.
If the taxpayer has entered a "Y" in any of the rows from Part I, Line 1, Column (f), then edit the Form 8949 as follows:
Place the form in sequence order. If there are more than one Form 8949 attached, then sequence the Form 8949 with the edited data.
Underline the EIN (Column (a)) from the first row with a "Y" in Column (f) if the EIN is present.
Underline the Date Sold or Disposed Of (Column c)) from the first row with a "Y" in Column (f) if the Date Sold or Disposed Of is present.
Underline the dollar amount (Column g)) from the first row with a "Y" in Column (f) if a money amount is present.
If the taxpayer has shown more than one row with a "Y" in Column (f), then edit "Y-1" to the right margin of Part I, Line 1, Row 1 of Form 8949.
If "Z-1" was edited, then edit "Y-1" under "Z-1" .
If the taxpayer has entered a "Z" in any of the rows from Part II, Line 1, Column (f) then edit Form 8949 as follows:
Place the form in sequence order. See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S. If there is more than one Form 8949 attached, then sequence the Form 8949 with the Part I edited data first followed by the Part II edited data.
Underline the EIN (Column (a)) from the first row with a "Z" present in Column (f) if EIN is present.
Underline the Date Acquired (Column (b)) from the first row with a "Z" present in Column (f) if the day, month, and year are present.
Underline the dollar amount (Column (g)) from the first row with a "Z" present in Column (f) if a money amount is present.
If the taxpayer has shown more than one row with a "Z" in Column (f), then edit "Z-1" to the right margin of Part II, Line 1, Row 1 of Form 8949.
If the taxpayer has entered a "Y" in any of the rows from Part II, Line 1, Column (f), then edit the Form 8949 as follows:
Place the form in sequence order. If there are more than one Form 8949 attached, then sequence the Form 8949 with the Part I edited data first and then the Part II edited data.
Underline the EIN (Column (a)) from the first row with a "Y" in Column (f) if the EIN is present.
Underline the Date Sold or Disposed Of (Column (c)) from the first row with a "Y" in Column (f) if Date Sold or Disposed Of is present.
Underline the dollar amount (Column (g)) from the first row with a "Y" in Column (f) if money amount is present.
If the taxpayer has shown more than one row with a "Y" in Column (f), then edit "Y-1" to the right margin of Part II, Line 1, Row 1 of Form 8949.
If "Z-1" was edited, then edit "Y-1" under "Z-1" .
Figure 3.11.217-25
This is an example of a current year Form 1120-S (Page 1 only) with an attached Form 8949.Form 8949, Sales and Other Dispositions of Capital Assets, page 1Top left corner of Form 8949 reads: DRAFTName line shows Spruce Holdings CoSocial Security Number or Taxpayer Identification Number shows 00-0015487Part I Box C is marked with an XPart I, Line 1, Column (h), red edited number Z-1Part I, Line 1, Column (a) shows 00-1210068 and underlined in redPart I, Line 1, Column (b) shows 1/8/24 and underlined in redPart I, Line 1, Column (f) shows the letter ZPart I, Line 1, Column (g) shows (10,000) and underlined in redPart I, Line 1, Column (a) shows 00-5644121Part I, Line 1, Column (b) shows 4/1/24Part I, Line 1, Column (f) shows the letter ZPart I, Line 1, Column (g) shows (25,000)Form 1120-S, Page 1, current year returnTop left corner of Form 1120-S reads: DRAFTBox A shows 06/03/1995 for S Election Effective dateBox B shows 546680 for the Business Activity CodeSpruce Holdings Co is shown on the name line and Spru is underlined as the name control1066 S Elm St is shown for the street address lineDallas, TX 75260 is shown for the city, state, and ZIP code lineBox D shows 00-0015487 for the Employer Identification Number (EIN)Box E shows 06/03/1995 for the date incorporatedBox F shows 5,200 for Total assetsBox I shows 12 for the Number of Shareholders during any part of the tax yearLeft of Line 2 and Line 3 in the dotted line area of the form is a red Computer Condition Code MLine 1a, Gross receipts or sales, shows 75,850Line 1c, Balance, shows 75,850Line 3, Gross profit, shows 75,850Line 6, Total income (loss) shows 75,850
3.11.217.33 (01-01-2022)
Form 8996, Qualified Opportunity Fund
Form 8996, Qualified Opportunity Fund, is valid for tax periods ending 201712 and later. The table below compares Form 8996 line numbers based on the tax year of the return:
2021 and later 2020 2019 2018 and 2017 Line 5 Line 5 Line 5 N/A Line 6 N/A N/A N/A Line 7 Line 7 Line 6 Line 5 Line 8 Line 8 Line 7 Line 6 Line 10 Line 10 Line 9 Line 8 Line 11 Line 11 Line 10 Line 9 Line 14 Line 14 Line 13 Line 12 Line 15 Line 15 Line 14 Line 13 For prior year conversion instructions, see Exhibit 3.11.217-4, Form 8996 - Prior Year Conversion Chart.
Place Form 8996 in sequence order if significant entries are present on any of the lines listed in a through h below. See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 8996.
Note:
Only Part III, Lines 14 and 15 require editing.
Part I, Line 5 checkbox is marked.
Part I, Line 6 - Reserved for future use.
Part II, Line 7 - Total QOZ property held by the taxpayer on the last day of the first 6-month period of the taxpayer’s tax year.
Part II, Line 8 - Total assets held by the taxpayer on the last day of the first 6-month period of the taxpayer’s tax year.
Part II, Line 10 - Total QOZ property held by the taxpayer on the last day of the taxpayer’s tax year.
Part II, Line 11 - Total assets held by the taxpayer on the last day of the taxpayer’s tax year.
Part III, Line 14 - Perfect Line 14 as follows:
- Edit the Line 14 percent in 0.00 format. For example, edit 50 percent as 0.50.
- If the percent is greater than 1.00, "X" the percentage amount on Line 14. For example, if the percentage shown is 1.23.Part III, Line 15 - Perfect Line 15 as follows:
- If Form 8996, Part III, Line 15 is blank and Part IV, Line 8 has an amount, edit Part IV, Line 8 to Part III, Line 15 in dollars cents.
If Form 8996, Qualified Opportunity Fund, is attached, then edit Return Processing Code (RPC) "6" . See IRM 3.11.217.13.7 Return Processing Code (RPC), for more information.
Note:
If Form 8996 is attached, then further editing may be needed on Form 1120-S, Schedule B, Line 15. See IRM 3.11.217.23.2(1). Form 8996 Qualified Opportunity Fund.
3.11.217.34 (01-01-2025)
Form 1125-A, Cost of Goods Sold (Formerly Form 1120-S, Page 2, Schedule A)
Place Form 1125-A, Cost of Goods Sold, in sequence order if entries are present on Line 1 or Line 7. See IRM 3.11.217.15.1, Sequence of Return - 1120-S.
Edit Form 1125-A in dollars only.
Form 1125-A Line 1 - Inventory at the beginning of the year. Accept taxpayer's entry. If Line 1 is blank, edit from the taxpayer's attachment (if present).
Form 1125-A Line 3 - Cost of labor. No specific editing is necessary, but an entry on this line is indicative of a Salary and Wage Code condition. See IRM 3.11.217.17.3, Salary and Wage Code.
Form 1125-A Line 7 - Inventory at the end of the year. Accept taxpayer's entry. If Line 7 is blank, edit from the taxpayer's attachment (if present).
Form 1125-A, must be dummied if missing and if Line 1 or Line 7 are able to be edited. Use instructions in (2) through (5) above to edit lines. Place dummy Form 1125-A in sequence order.
Note:
If a negative entry is present on either of Line 1 or Line 7, "X" the amount.
Figure 3.11.217-26
This is an example of creating a dummy Form 1125-A, Cost of Goods Sold, when Schedule A is attached. The amounts on a prior year Schedule A, Line 1 (250) and Line 7 (100) are transferred to a dummy Form 1125-A, Line 1 and Line 7.Form 1120-S, Schedule A, Line 1 shows 250Form 1120-S, Schedule A, Line 6 shows 250Form 1120-S, Schedule A, Line 7 shows 100Form 1125-A, Cost of Goods Sold, Line 1 shows 250 edited in redForm 1125-A, Cost of Goods Sold, Line 7 shows 100 edited in red
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 1125-A.
3.11.217.35 (01-01-2025)
Form 4136, Credit for Federal Tax Paid on Fuels
If Form 4136, Credit for Federal Tax Paid on Fuels, is missing and a significant entry is claimed on Form 1120-S, Page 1, Line 24c for a Fuel Tax Credit, correspond with the taxpayer for the missing Form 4136.
Note:
A significant entry is defined as any amount other than zero.
Note:
2022 and prior Form Revisions have Fuel Tax Credits listed on line 23c.
If a fuel credit claim is found on other than the correct line on the return, and Form 4136 is attached, adjust incorrect entry before editing Fuel Tax Credits.
Form 4136 needs to be placed in sequence order.
If Fuel Tax Credit is claimed on Page 1, Form 1120-S and Form 4136 is attached, perfect Column (d) as necessary. Column (d) must equal Line 17 of Form 4136. If perfection is not possible, correspond.
Code and Edit is no longer required to renumber the lines on prior year Form 4136 to current year format. Column (d), Amount of credit, is transcribed using the corresponding Credit Reference Number (CRN) in Column (e).
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 4136.
3.11.217.36 (01-01-2022)
Form 8913, Credit for Federal Telephone Excise Tax Paid Only Tax Return
- This credit was used for tax periods 200612 - 200711 when claiming credit on Form 8913, Credit for Federal Telephone Excise Tax Paid Only Tax Return. No editing is required.
3.11.217.37 (01-01-2023)
Form 8941, Credit for Small Employer Health Insurance Premiums
Place Form 8941, Credit for Small Employer Health Insurance Premiums, in sequence order if significant entries are present.
Note:
A significant entry is defined as any amount other than zero.
Significant entries are present on one or more of the transcription lines (T lines). Transcription lines are shown in the Transcription Line Table below.
Transcription Line Description A Small Business Health Options Program (SHOP) Marketplace Box - Did you pay premiums during your tax year for employee health insurance coverage you provided through a Small Business health Options Program (SHOP) Marketplace (or do you qualify for an exception to this requirement)? B Employer Identification Number (EIN) - Enter the employer identification number (EIN) used to report employment taxes for individuals included on Line 1 below if different from the identifying number listed above. C Does a tax return you (or any predecessor) filed for a tax year beginning in 2014 include a Form 8941, Credit for Small Employer Health Insurance Premiums, with Line A checked "Yes" and Line 12 showing a positive amount? 1 Enter the number of individuals you employed during the tax year who are considered employees for purposes of this credit (total from Worksheet 1, Column (a)). 2 Enter the number of full-time equivalent employees (FTEs) you had for the tax year (from Worksheet 2, Line 3). If you entered 25 or more, skip Lines 3 through 11 and enter -0- on Line 12. 3 Average annual wages you paid for the tax year (from Worksheet 3, Line 3). This amount must be a multiple of $1,000. 4 Premiums you paid during the tax year for employees included on Line 1 for health insurance coverage under a qualifying arrangement (total from Worksheet 4, Column (b)). 5 Premiums you would have entered on Line 4 if the total premium for each employee equaled the average premium for the small group market in which the employee enrolls in health insurance coverage (total from Worksheet 4, Column (c)). 10 Enter the total amount of any state premium subsidies paid and any state tax credits available to you for premiums included on Line 4 (see instructions). 13 If Line 12 is zero, skip Lines 13 and 14 and go to Line 15. Otherwise, enter the number of employees included on Line 1 for whom you paid premiums during the tax year for health insurance coverage under a qualifying arrangement (total from Worksheet 4, Column (a)). 14 Enter the number of FTEs you would have entered on Line 2 if you only included employees included on Line 13 (from Worksheet 7, Line 3). 15 Credit for small employer health insurance premiums from partnerships, S corporations, cooperatives, estates, and trusts (see instructions). 16 Add Lines 12 and 15. Cooperatives, estates, and trusts, go to Line 17. Tax-exempt small employers skip Lines 17 and 18 and go to Line 19. Partnerships and S corporations, stop here and report this amount on Schedule K. All others, stop here and report this amount on Form 3800, Part III, Line 4h. For prior year Form 8941, Credit for Small Employer Health Insurance Premiums, revisions, if significant amounts/entries are present on Form 8941, see Form 8941 Prior Year Revision Table below.
Form 8941 Prior Year Revision Action 2013 * Change Line 1a to Line 1 * Change Line 1b to Line B 2012 * Change Line 1a to Line 1 * Change Line 1b to Line B See IRM 3.11.217.47 , Form 1120-S Prior Year Conversion Charts, for more prior year information.
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 8941.
3.11.217.38 (01-01-2023)
Form 5884-B, New Hire Retention Credit
- The status of Form 5884-B, New Hire Retention Credit, is historical and was valid March 19, 2010, to December 31, 2010 (Tax Periods 2010 and 2011).
3.11.217.39 (01-01-2026)
Form 3800, General Business Credit
Form 3800, General Business Credit, is valid for tax periods ending in 202301 and later. Part III, which may be attached to Form 1120-S, is transcribed to support the Elective payment election (EPE) on Line 24d.
Note:
Line 1l, Form 8864 (diesel) columns (b), (f), and (g) is transcribed for Tax Period 202507 and later. If the tax period is before 202507 and data is present is on Line 1, columns (b), (f), or (g), then edit the data for non transcription.
Correspond with Letter 118C, if Form 3800, General Business Credit, is not attached and the EPE credit claimed is≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ on Form 1120-S, line 24d. Edit Action Code "211" .
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡.
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
The followings lines are transcribed from Form 3800 Part III (Data will enter):
Form 3800, Part III and Line Credit From Form Title Columns transcribed Line 1b Form 7207, Advanced Manufacturing Production Credit b, f, g, h, j Line 1d Form 3468, Part III Investment Credit b, f, g Line 1f Form 8835, Part II Renewable Electricity Production Credit b, f, g Line 1g Form 7210 Clean Hydrogen Production Credit b, f, g, h, j Line 1l Form 8864, Biodiesel, Renewable Diesel, or Sustainable Aviation Fuels Credit b, f, g Line 1o Form 3468, Part IV Investment Credit b, g, h, j Line 1q Form 7218, Part II Clean Fuel Production Credit b, f, g Line 1s Form 8911, Part I Alternative Fuel Vehicle Refueling Property Credit b, f, g Line 1u Form 7213, Part II Nuclear Power Production Credit b,f, g Line 1v Form 3468, Part V Investment Credit b, f, g Line 1x Form 8933 Carbon Oxide Sequestration Credit b, f, g, h, j Line 1aa Form 8936, Part V Clean Vehicle Credits b, g Line 1gg Form 7211, Part II Clean Electricity Production Credit b, f, g Line 4a Form 3468, Part VI Investment Credit b, f, g Line 4e Form 8835, Part II Renewable Electricity Production Credit b, f, g Edit indicator "1" in the bottom right margin of Form 3800, page 4, Part III when Form 3800, Part V, column b (Elective Payment or Transfer Registration Number) has significant data. See Figure 3.11.217-27, Example of Editing Form 3800, General Business Credit, Part V, Indicator below.
Correspond with Letter 118C, if Form 3800, General Business Credit, is not attached and the EPE credit claimed is≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ on Form 1120-S, line 24d. Edit Action Code "211" .
Figure 3.11.217-27
This is an example of the header of Form 3800, General Business Credit. There is a picture of Form 3800, page 4, showing an edited 1 to signify that Form 3800, Part V, Column b, has significant data.Page 1 of Form 3800 shows DRAFT in the top left corner.Page 4 of Form 3800 shows DRAFT in the top left corner.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col a shows 1.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col d shows 1,523.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col e shows 4,555.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col f shows 975.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col g shows 5,530.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col h shows 2,098.Page 4 of Form 3800, Line 4a, Form 3468, Part VI, Col j shows 2,098.A 1 is edited in red at the bottom right side of Form 3800, page 4.Form 3800, Page 8 has DRAFT edited in the top left corner.Form 3800, Page 8, Part V line 1 col a shows 4a.Form 3800, Page 8, Part V line 1 col b shows 0001234567.Form 3800, Page 8, Part V line 1 col c shows 00-7412003.Form 3800, Page 8, Part V line 1 col d1 shows 2,971.Form 3800, Page 8, Part V line 1 col d2 shows 560.Form 3800, Page 8, Part V line 1 col d3 shows 975.Form 3800, Page 8, Part V line 1 col d4 shows 1,436.Form 3800, Page 8, Part V line 1 col e shows 2,098.Form 3800, Page 8, Part V line 1 col f1 shows 3,995.
For prior year conversion instructions, see Exhibit 3.11.217-9, Form 3800 - Prior Year Revisions Comparison Chart.
3.11.217.40 (01-01-2022)
Form 8997, Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments
Form 8997, Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments, is valid for tax periods ending 201901 and later.
Place Form 8997 in sequence order if the form is attached and significant entries are present in any of Parts I, II, III or IV.
No editing is required except for the indicator in Parts I, II, III or IV. Transcription is from Row 1 of each part.
Part I - Total QOF Investment Holdings due to Deferrals Prior to Beginning of Tax Year (Row 1).
Column a - QOF EIN.
Column b - Date QOF Investment acquired.
Column d - Special gain code.
Column e - Amount of short-term deferred gain remaining in QOF.
Column f - Amount of long-term deferred gain remaining in QOF.
Part I Indicator - If more than one row of tax data is present in Part I, edit "1" in the right margin of Part I, row 1.
Line 2, Column e - total amount.
Line 2, Column f - total amount.
Part II - Current Tax Year Capital Gains Deferred by Investing in QOF (Row 1).
Column a - QOF EIN.
Column b - Date QOF investment acquired.
Column d - Special gain code.
Column e - Amount of short-term deferred gain remaining in QOF.
Column f - Amount of long-term deferred gain remaining in QOF.
Part II Indicator - If more than one row of tax data is present in Part II, edit "1" in the right margin of Part II, Row 1.
Line 2, Column e - total amount.
Line 2, Column f - total amount.
Part III - Inclusion Events and Certain Other Transfers During the Current Tax Year (Row 1).
Column a - QOF EIN.
Column b - Date of event.
Column d - Special gain code.
Column e -Amount of previously deferred short-term gain now included in taxable income.
Column f - Amount of previously deferred long-term gain now included in taxable income.
Part III Indicator - If more than one row of tax data is present in Part III, edit "1" in the right margin of Part III, row 1.
Line 2, Column e - total amount.
Line 2, Column f - total amount.
Part IV - Total QOF Investments Due to Deferrals at Year End (Row 1).
Column a - QOF EIN.
Column b - Date QOF Investment acquired.
Column d - Special gain code.
Column e - Amount of short-term deferred gain invested in QOF.
Column f - Amount of long-term deferred gain invested in QOF.
Part IV Indicator - If more than one row of tax data is present in Part IV, edit "1" in the right margin of Part IV, row 1.
Line 2, Column e total amount.
Line 2, Column f total amount.
If Form 8997, Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments, is attached, edit Return Processing Code (RPC) "9" . See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information.
3.11.217.41 (01-01-2026)
Form 8283, Noncash Charitable Contributions
Form 8283, Noncash Charitable Contributions is valid for transcription for Tax Periods ending 201901 and later when data is present on any of the following lines.
Note:
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 8283.
Line Line Description 2 Information on Donated Property Type Check boxes 3A(c) Donated Property Appraised Fair Market Value 3A(d) Donated Property Date Acquired by Donor 3A(f) Donated Property Donor’s Cost or Adjusted Basis Part IV Appraiser Signature Indicator Part IV Appraiser Identifying Number Part V Qualified Organization Property Received Date Part V Charitable Organization Employer Identification Number Part V Charitable Organization Authorized Signature Indictor Part V, Lower right corner pg. 2. Multiple Form 8283 Attached Tax Period ending 201812 and prior - Form 8283 is not valid for transcription. Do not put Form 8283 is sequence order.
Form 8283, Noncash Charitable Contributions is required to be attached to the return if a deduction over $500 is claimed on Line 12b, Schedule K. Correspond if Form 8283 is not attached.
If multiple Form 8283 is attached, edit a 1 on page 2, of Form 8283, Part V, lower right corner.
3.11.217.42 (01-01-2023)
Form 6252, Installment Sale Income
Form 6252, Installment Sale Income, is valid for tax periods ending in 201712 and later.
Only one Form 6252 can be processed. If multiple forms are attached, process the first one with significant transcription entries and delete the others.
Caution:
Multiple Forms 6252 must be used to determine the Installment Sale Indicator.
Place Form 6252 in sequence order if entries are present on any of the transcription lines listed below. See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 6252.
Note:
Part II, Line 19 is the only line that requires editing, however, an Installment Sale Indicator must be determined from Line 3. See IRM 3.11.217.13.3, Installment Sale Indicator.
Line 1 - Description of Property
Line 2a - Date acquired.
Line 2b - Date sold.
Line 3 - Was the property sold to a related party?
Part I, Line 7 - Subtract Line 6 from Line 5.
Part II, line 19 - Gross Profit Percentage.
Part II, Line 21 - Payments received during year.
Part II, Line 23 - Payments received in prior years.
Line 1 - Description of Property - Taxpayer may enter a code and a description of installment sale property as described in the table below. No editing is required.
Indicator Description of property 1 Sale property is Timeshare or residential lot 2 Sale by an individual of personal use property (within the meaning of Section 1275(b)(3)) 3 Sale of any property used or produced in the trade or business of farming (within the meaning of Section 2032A(e)(4) or (5)) 4 Other - All other installment sales not listed Line 3 - Was the property sold to a related party? - Information is used to determine the Installment Sale Indicator - Edit 3 - followed by the appropriate Installment Sale Indicator code in the left margin of Form 1120-S, Page 1, near line 9 when Form 6252 is present (e.g., 3 - 1). Valid Installment Indicator codes are as follows:
Code One Form 6252 More than one Form 6252 1 "Yes" response to Question 3, At least one form has a "Yes" response. 2 "No" response to Question 3, All "No" responses, or a combination of "No" and/or blank responses. 3 "Yes" and "No" are checked or Question 3 is blank, Question 3 is blank on all forms. Part II, line 19 - Gross Profit Percentage - If Line 19 is not in 0.0000 format, edit the percentage as follows:
Taxpayer’s Entry Edit 50 percent 0.5000 .123 0.1230 .12345 0.1234 Note:
ISRP will only transcribe four digits after the decimal. If more than four digits are present, e.g., 0.123456, it is not necessary to delete the extra digits. If the percent is greater than 1.00, X the percentage amount on Line 19. For example, the percentage is 1.2300 or 1.23 percent.
See IRM 3.11.217.13.3, Installment Sale Indicator, for more information.
3.11.217.43 (01-01-2026)
Form 8936, Schedule A- Clean Vehicle Credit Amount (202301 and later)
Sequence up to two Form 8936, Schedule As. See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S, for more information.
The following lines will be transcribed from the first two Form 8936, Schedule As attached.
Part I, Line 2, Vehicle identification number (VIN)
Part I, Line 3, Placed in service date
Part II, Line 9, Tentative credit amount
Part II, Line 11, Credit amount for business use of new clean vehicle
Part IV, Line 17, Smaller of line 15 or line 16
Part V, Line 26, Smaller of line 24 or line 25
If more than two Forms 8936, Schedule A are attached, edit an indicator of "1" on page 3 of the second Form 8936, Schedule A in the bottom right margin. See Figure 3.11.217-28
Figure 3.11.217-28
This is an example of editing Form 8936, Schedule A, Indicator on the second Form 8936, Schedule A, Page 3, bottom right margin when more than two Forms 8936, Schedule A are attached.Form 8936, Schedule A page 3 has DRAFT in the top left corner.The tops of pages 1, 2 and 3 of a second Form 8936, Schedule A are shown with DRAFT in the top left corner and with a 1 edited in red in the lower right corner of page 3.The tops of pages 2 and 3 of another Form 8936, Schedule A are shown with DRAFT in the top left corner.Page 1 of another Form 8936, Schedule A is shown with DRAFT in the top left corner.Poplar & Pine are shown in the Name box.The Identifying number box shows 00-2254366.Part I, line 1a shows 2025.Part I, line 1b shows Chevrolet.Part I, line 1c shows Bolt EV.Part I, line 2 shows 000XX41IX3N109186.Part I, line 3 shows 03/08/2025.Part I, line 4a has the No box checked.Part I, line 5 has the Yes box checked.A text box is located under line 5 and states If more than two Form 8936, Schedules A are attached, edit an indicator of 1 on page 3 of the second Schedule A with an arrow pointed to the red 1 in the lower right corner.
If Form 8936, Schedule A, is not attached and the Clean Vehicle Credit (CVC) claimed on Form 1120-S, Schedule K, line 13g is ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ then correspond for the missing Form 8936, Schedule A.
3.11.217.44 (01-01-2025)
Form 4255, Certain Credit Recapture, Excessive Payments, and Penalties
Form 4255, Certain Credit Recapture, Excessive Payments, and Penalties, is valid for tax period ending 202401 and later.
Place Form 4255 in sequence order if the form is attached and significant entries are present in Part I, columns (s) or (t). See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S, for the sequence order of Form 4255.
No editing is required. The following lines will be transcribed from Form 4255.
Part I, line 1a, column (s) - Form 7207, Recapture of Net EPE and 100% Excessive payment. Add columns (l) and (n).
Part I, line 1a, column (t) - Form 7207, 20% Excessive payment, Prevailing wage, and apprenticeship penalties. Add columns (o) and (p).
Part 1, line 1c, column (s) - Form 7210, Recapture of Net EPE and 100% Excessive payment. Add columns (l) and (n).
Part 1, line 1c, column (t) - Form 7210, 20% Excessive payment, Prevailing wage, and apprenticeship penalties. Add columns (o) and (p).
Part I, line 1d, column (s) - Form 3468, Part IV, Recapture of Net EPE and 100% Excessive payment. Add columns (l) and (n).
Part I, line 1d, column (t) - Form 3468, Part IV, 20% Excessive payment, Prevailing wage, and apprenticeship penalties. Add columns (o) and (p).
Part 1, line 2a, column (s) - Form 8933, Recapture of Net EPE and 100% Excessive payment. Add columns (l) and (n).
Part I, line 2a, column (t) - Form 8933, 20% Excessive payment, Prevailing wage, and apprenticeship penalties. Add columns (o) and (p).
3.11.217.45 (01-01-2026)
Schedule K-1, Shareholder’s Share of Income, Deductions, Credits, etc.
All Form 1120-S filers must complete and file Schedule K-1, Shareholder’s Share of Income, Deductions, Credits, etc., and attach it to the Form 1120-S. If no Schedules K-1 are attached, follow the procedures listed below:
Note:
Detach Schedules K-1 for current year (TY2024), two preceding years (TY2023 and TY2022), and future Schedules K-1.
Note:
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
Do not correspond for Schedule K-1 if:
Section 965 Returns - See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information.
Form 1120-S is a TY2021 and prior tax period.
Form 1120-S, Line 22 (line 21 on Form 1120-S 2022 form revision and prior), Ordinary Business Income (Loss), ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
There are attachments to the return in a standard format which may be used as a Schedule K-1.
Re-entry return (Form 13596, Reprocessing Returns or Form 3893, Re-Entry Document Control, is attached to return).
Amended (CCC "G" ) return.
IRC 6020(b) return
Examination Secured "Substitute for Return" (SFR) returns.
There are no entries on Form 1120-S, Lines 1 through 22 (line 21 on Form 1120-S 2022 revision).
Form 1120-S has a Form 4251, Return Charge-Out, attached and is being processed as an original return
Payee is a foreign entity.
When correspondence with the taxpayer is required, see IRM 3.11.217.3.4.2, Issuing Correspondence.
If Schedule K-1, Line 15*, Alternative minimum tax (AMT) items, has an amount ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡, edit Tax Preference Code in the left margin near Line 9 (Deductions area) of Form 1120-S. See IRM 3.11.217.13.4, Tax Preference Code.
Form 1120-S, Schedule K-1, Box 10 (with code F), Box 12 (with code K), and Box 14 (with code U) may show a Section 965 return. See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information.
≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡"≡ ≡" ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedules K-1.
See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S, for the sequence order of Schedule K-1.
3.11.217.46 (01-01-2025)
Form 8938, Statement of Specified Foreign Financial Assets
For Tax Year (TY) 202201 and later, Form 8938, Statement of Specified Foreign Financial Assets, will be transcribed into the General Purpose Programming (GPP) database.
Process Form 8938 with the following criteria:
The Tax Period Beginning on Form 1120-S is 202201 or later, and
Form 8938 is a 2021 revision, and
Form 8938 has significant entries.
Note:
A significant entry is defined as any amount other than zero.
If Form 8938 is attached, but does not meet the criteria in paragraph (2), edit CCC "2" and continue normal processing of the Form 1120-S. Do not sequence the form to the back of the return or place the form in a designated basket.
If the return meets the criteria in paragraph (2), process Form 8938 per the instructions below:
Completely edit Form 1120-S.
Edit CCC "2" .
Detach Schedules K-1.
Pull the Form 8938 from the return and sequence to the back of the last page of Form 1120-S (after schedules and attachment pages), attaching the Form 8938 so that it is back- to- back with the parent return.
Place the Form 1120-S in a designated basket.
Only one Form 8938, Pages 1 and 2, can be processed. If multiple Forms 8938 are attached, select the form that has the highest account value in Part V, Line 23; or highest asset value in Part VI, Line 32, and delete the others.
Note:
The Form 8938 can have multiple "Additional or Continuation Statements" . Do not confuse the multiple additional or continuation statements with multiple Form 8938.
Form 1120-S with Form 8938 attached must be batched separately. The transcription of Form 8938 occurs under Program Code 43300 after the parent Form 1120-S is transcribed.
See IRM 3.11.217.15.1(1), Sequence of Return - Form 1120-S, for the sequence order of Form 8938.
3.11.217.47 (01-01-2026)
Form 1120-S Prior Year Conversion Charts
The following charts show information for converting Form 1120-S, U.S. Income Tax Return for an S Corporation (and other applicable forms and schedules) to the current year form (and schedule).
Form 1120-S 2022 - 2017 Revision Conversion:
Line Name 2022-2021 Line 2020-2018 Line 2017 Line Edit as Line Other Deduction 19 19 19 20 Total Deduction 20 20 20 21 Ordinary Business Income (Loss) 21 21 21 22 Schedule D Tax (Form 1120-S) 22b 22b 22b 23b Lines 22a and 23b Combined Total 22c 22c 22c 23c Estimated Tax Payments 23a 23a 23a 24a Tax Deposit Form 7004 23b 23b 23b 24b Federal Taxes Paid on Fuels (Form 4136) 23c 23c 23c 24c Total Payments 23d 23e 23d 24Z Estimated Tax Penalty 24 24 24 25 Amount Owed 25 25 25 26 Overpayment 26 26 26 27 Credited Estimated Tax Payments 27 27 27 28 Schedule D (Form 1120-S) 2012 Revision Conversion:
Line Name 2012 Edit as Line Short-term totals from all Forms 8949 with box A checked in Part I 1 1b Long-term totals from all Forms 8949 with box A checked in Part I 8 8b Form 8996 2022 - 2017 Revision Conversion:
Line Name 2020 Line 2019 - 2018 Line Edit as Line Total qualified opportunity zone property Held Last Day First 6-month 6 5 7 Total assets held Last Day of First 6-month 7 6 8 Total qualified opportunity zone property held last day of tax year 9 8 10 Total assets held by the taxpayer on the last day of tax year 10 9 11 Divide line 12 by 2.0 13 12 14 Is line 13 equal to or more than 0. 14 13 15 Form 8941 2013 - 2012 Revision Conversion:
Line Name 2013-2012 Edit as Line Number of individuals you employed during the tax year 1a 1 Employer identification number EIN 1b B Form 3800 2023 Revision Conversion - If an amount is present on Form 8300, Part III for any of the line listed below, then edit columns as follows:
Form/Line Number Edit as Line Form 7207, Line 1b, * Change column (g) to (f) * Change column (i) to (j) * Change column (j) to column (g) Form 3468, Part III, Line 1d * Change column (g) to (f) * Change column (j) to (g) Form 8835, Part II, Line 1f * Change column (g) to (f) * Change column (j) to (g) Form 7210, Line 1g * Change column (g) to (f) * Change column (i) to (j) * Change column (j) to (g) Form 3468, Part IV, Line 1o * Change column (i) to (j) * Change column (j) to (g) Form 8911, Part I, Line 1s * Change column (g) to (f) * Change column (j) to (g) Form 7213, Part II, Line 1u * Change column (g) to (f) * Change column (j) to (g) Form 8933, Line 1x * Change column (g) to (f) * Change column (i) to (j) * Change column (j) to (g) Form 8936, Part V, Line 1aa * Change column (j) to (g) Form 3468, Part VI, Line 4a * Change column (g) to (f) * Change column (j) to (g) Form 8835, Part II, Line 4e * Change column (g) to (f) * Change column (j) to (g)
Exhibit 3.11.217-1
Acronyms and Abbreviations
The table below lists commonly used acronyms, abbreviations, and their definitions.
| Acronyms and Abbreviations | Definition |
|---|---|
| ACA | Affordable Care Act |
| ADP | Automatic Data Processing |
| AM | Accounts Management |
| AMRH | Accounts Maintenance Research |
| APO | Army Post Office |
| AUR | Automated Underreporter |
| BBTS | Batch Block Tracking System |
| BMF | Business Master File |
| c/o | Care of |
| C&E | Code and Edit |
| CAS | Correspondence Action Sheet |
| CBR | Case Base Reasoning |
| CCC | Computer Condition Code |
| CDP | Collection Due Process |
| CFR | Code of Federal Regulations |
| CI | Criminal Investigation |
| CII | Correspondence Imaging Inventory |
| CP | Computer Paragraph |
| CSCO | Compliance Services Collection Operations |
| DLN | Document Locator Number |
| DPO | Diplomatic Post Office |
| DPO | Document Perfection Operation |
| EEFax | Enterprise Electronic Fax |
| E-File | Electronic Filing |
| e.g. | For Example |
| EIN | Employer Identification Number |
| EQSP | Embedded Quality Submission Processing |
| EOCU | EO Compliance Unit |
| ERS | Error Resolution System |
| etc. | Et Cetera |
| Exam | Examination |
| FATCA | Foreign Account Tax Compliance Act |
| Fax | Facsimile |
| FB | Foreign Branches |
| FDE | Foreign Disregarded Entities |
| FedEx | Federal Express Corporation |
| FPO | Fleet Post Office |
| FRP | Frivolous Return Program |
| FTF | Failure To File |
| FTP | Failure To Pay |
| GILTI | Global Intangible Low-Taxed Income |
| GPP | General Purpose Programming |
| HIRE | Hiring Incentives to Restore Employment |
| http | Hyper Text Transfer (or Transport) Protocol |
| ICS | Integrated Collection System |
| ICT | Image Control Team |
| ID | Identification or Identity |
| IDRS | Integrated Data Retrieval System |
| IMF | Individual Master File |
| IPU | IRM Procedural Update |
| IRC | Internal Revenue Code |
| IRS | Internal Revenue Service |
| ISRP | Integrated Submission and Remittance Processing |
| IT | Information Technology |
| KCSPC | Kansas City Submission Processing Campus or Kansas City Submission Processing Center |
| LB&I | Large Business and International |
| MeF | Modernized E-file |
| MFT | Master File Tax |
| MMDDYY | Month, Day, Year |
| NAICS | North American Industry Classification System |
| N/A | Not Applicable |
| NDC | National Distribution Center |
| OC | Other Country |
| OID | Original Issue Discount |
| OMB | Office of Management and Budget |
| OSPC | Ogden Submission Processing Campus or Ogden Submission Processing Center |
| PBA | Principal Business Activity |
| PDS | Private Delivery Service |
| P.L. | Public Law |
| PTIN | Preparer Tax Identification Number |
| POA | Power of Attorney |
| P.O. | Post Office |
| QSSS | Qualified Subchapter S Subsidiary |
| R&C | Receipt and Control |
| RD | Return Delinquency |
| Rev. Proc. | Revenue Procedure |
| RICS | Return Integrity and Compliance Services |
| RO | Revenue officer |
| RPC | Return Processing Code |
| RRA98 | Restructuring and Reform Act of 1998 |
| SBSE | Small Business Self-Employed |
| SCAMPS | Service Center Automated Mail Processing System |
| SCRIPS | Service Center Recognition Image Processing System |
| SERP | Servicewide Electronic Research Program |
| SFR | Substitute for Return |
| SLA | Service Level Agreement |
| SME | Subject Matter Expert |
| SOI | Statistics of Income |
| SP | Submission Processing |
| SPDC | Submission Processing Design Center |
| SSN | Social Security Number |
| TAC | Taxpayer Assistance Center |
| TAS | Taxpayer Advocate Service |
| TBOR | Taxpayer Bill of Rights |
| TC | Transaction Code |
| TCJA | Tax Cuts and Jobs Act of 2017 |
| TE | Tax Examiner |
| TEGE | Tax Exempt and Government Entities |
| TETR | Telephone Excise Tax Refund |
| TIN | Taxpayer Identification Number |
| TP | Taxpayer |
| TPE | Tax Period Ending |
| TRPRT | Tax Return Print |
| TS | Taxpayer Services ### Note: April 2024, Wage and Investment (W&I) changed to Taxpayer Services. |
| TY | Tax Year |
| U.S. | United States |
| UCC | Uniform Commercial Code |
| UPS | United Parcel Service |
| USC | United States Code |
| USPS | United States Postal Service |
| UWR | Unified Work Request |
| ZIP | Zoning Improvement Plan |
Note:
The above list may not be all-inclusive.
Exhibit 3.11.217-2
Due Date Chart
| Tax Period | Return Due Date (weekends and holidays considered) | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | Extended Due Date - 6 months (weekends and holidays considered) |
|---|---|---|---|
| Jan. 2024 | 4-16-2024 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 10-15-2024 |
| Feb. 2024 | 5-15-2024 | ≡ ≡ ≡ ≡ ≡ | 11-15-2024 |
| Mar. 2024 | 6-17-2024 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 12-16-2024 |
| Apr. 2024 | 7-15-2024 | ≡ ≡ ≡ ≡ ≡ ≡ | 1-15-2025 |
| May 2024 | 8-15-2024 | ≡ ≡ ≡ ≡ ≡ ≡ | 2-18-2025 |
| Jun. 2024 | 9-16-2024 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 3-17-2025 |
| Jul. 2024 | 10-15-2024 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 4-15-2025 |
| Aug. 2024 | 11-15-2024 | ≡ ≡ ≡ ≡ ≡ ≡ | 5-15-2025 |
| Sept. 2024 | 12-16-2024 | ≡ ≡ ≡ ≡ ≡ ≡ | 6-16-2025 |
| Oct. 2024 | 1-15-2025 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 7-15-2025 |
| Nov. 2024 | 2-18-2025 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 8-15-2025 |
| Dec. 2024 | 3-17-2025 | ≡ ≡ ≡ ≡ ≡ | 9-15-2025 |
| Jan. 2025 | 4-15-2025 | ≡ ≡ ≡ ≡ ≡ | 10-15-2025 |
| Feb. 2025 | 5-15-2025 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 11-17-2025 |
| Mar. 2025 | 6-16-2025 | ≡ ≡ ≡ ≡ ≡ ≡ | 12-15-2025 |
| Apr. 2025 | 7-15-2025 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 1-15-2026 |
| May 2025 | 8-15-2025 | ≡ ≡ ≡ ≡ ≡ | 2-17-2026 |
| June 2025 | 9-15-2025 | ≡ ≡ ≡ ≡ ≡ ≡ | 3-16-2026 |
| July 2025 | 10-15-2025 | ≡ ≡ ≡ ≡ ≡ ≡ | 4-15-2026 |
| Aug. 2025 | 11-17-2025 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 5-15-2026 |
| Sep. 2025 | 12-15-2025 | ≡ ≡ ≡ ≡ ≡ ≡ | 6-15-2026 |
| Oct. 2025 | 1-15-2026 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 7-15-2026 |
| Nov. 2025 | 2-17-2026 | ≡ ≡ ≡ ≡ ≡ | 8-17-2026 |
| Dec. 2025 | 3-16-2026 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 9-15-2026 |
| Jan. 2026 | 4-15-2026 | ≡ ≡ ≡ ≡ ≡ | 10-15-2026 |
| Feb. 2026 | 5-15-2026 | ≡ ≡ ≡ ≡ ≡ ≡ | 11-16-2026 |
| Mar. 2026 | 6-16-2026 | ≡ ≡ ≡ ≡ ≡ ≡ | 12-15-2026 |
| Apr. 2026 | 7-15-2026 | ≡ ≡ ≡ ≡ ≡ ≡ | 1-15-2027 |
| May 2026 | 8-17-2026 | ≡ ≡ ≡ ≡ ≡ ≡ | 2-16-2027 |
| June 2026 | 9-15-2026 | ≡ ≡ ≡ ≡ ≡ ≡ | 3-15-2027 |
| July 2026 | 10-15-2026 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 4-15-2027 |
| Aug. 2026 | 11-16-2026 | ≡ ≡ ≡ ≡ ≡ ≡ | 5-17-2027 |
| Sep. 2026 | 12-15-2026 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 6-15-2027 |
| Oct. 2026 | 1-15-2027 | ≡ ≡ ≡ ≡ ≡ ≡ | 7-15-2027 |
| Nov. 2026 | 2-15-2027 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 8-16-2027 |
| Dec. 2026 | 3-15-2027 | ≡ ≡ ≡ ≡ ≡ ≡ ≡ | 9-15-2027 |
Exhibit 3.11.217-3
Routing Guide for Attachments
Review all attachments to the return before the return can be considered processable.
Only detach attachments when specifically instructed.
Note:
Consider a return or document an "Original" if it has an original signature or is stamped "Process as Original" .
Edit Action Trail(s) (e.g., 2848 detached or similar language) in the lower left margin going vertically up the side of the return.
Edit the name and EIN (if not present) on the detached document. Also, edit the return received date (e.g., Rec’d MM/DD/YY) in the lower left margin of the detached document before routing.
Follow general guidelines below for each attachment:
Form/Document Detach Descriptions/Action Adjustment - Request for Adjustment to another document Yes * Route to appropriate function. * Attachment must contain Name, Address, EIN, and Received Date. Edit if missing. IRC 965, Transition Tax Statement (or similar 965 statement) ### Note: Additional Form 965 series below. No * Edit Computer Condition Code "J" and Action Code 460 (Management Suspense) on the return and continue processing. ### Caution: Do not correspond on Section 965 Returns. ERS will take care of any correspondence needed. * See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information. * See IRM 3.11.217.3.1, Action Codes, for more information. * See IRM 3.11.217.14.7, CCC "J" - Section 965 Tax, for more information. * See IRM 3.11.217.24.3, Schedule K, Line 10 - Other Income (Loss), for more information. * See IRM 3.11.217.24.4, Schedule K, Line 12d - Other Deductions, for more information. * See IRM 3.11.217.24.11, Schedule K, Line 14r - Other Foreign Tax Information, for more information. * See IRM 3.11.217.24.13, Schedule K, Line 17d - Other items and amounts, for more information. * See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedule K-1. CP 259, CP 959, (Spanish version) Master File Generated 1st TDI Notice ### Note: Do not route to Statute Control Unit for clearance. See IRM 3.11.217.3.7, Statute Returns, for more information. No Correspondence is attached or taxpayer’s response shows: * Taxpayer disagrees that they must file the return. * Only page one of the return is attached. * Employer Identification Number (EIN) on notice does not match EIN on return. * Return requested on notice not the same as return submitted. * Taxpayer asking question(s) or requesting the IRS take action(s) on their account. * Case involves any other IRS action(s) C&E not trained to complete. Then, Route to Compliance Services Collection Operations (CSCO). Use return address on Computer Paragraph (CP) notice: * Brookhaven - Mail Stop #662 * Memphis - Mail Stop #81 * Philadelphia - 4-N31.142 If none of the above apply, correspondence or written response to the notice is not attached, and/or, "599" is notated: 1. Move the notice to the back of the return. 2. Continue processing the return. ### Note: If the return is unsigned, but the taxpayer signed the CP notice under the jurat, it is not necessary to correspond for the signature. CP 259 A through H Master File Generated 1st TDI Notice No Route to: Ogden Submission Processing Campus (OSPC) BMF Entity Mail Stop 6273 CP 504/504B Final Notice - Balance Due No 1. Place Computer Paragraph (CP) 504/CP 504B to the front of the return. 2. Route notice and return to Accounts Management (AM). CP 518 Delinquency Notice ### Note: Do not route to Statute Control Unit for clearance. See IRM 3.11.217.3.7, Statute Returns, for more information. No Correspondence is attached or taxpayer’s response shows: * Taxpayer disagrees that they must file the return. * Only page one of the return is attached. * Employer Identification Number (EIN) on notice does not match EIN on return. * Return requested on notice not the same as return submitted. * Taxpayer asking question(s) or requesting the IRS take action(s) on their account. * Case involves any other IRS action(s) C&E not trained to complete. Then, Route to Compliance Services Collection Operations (CSCO). Use return address on Computer Paragraph (CP) notice: * Brookhaven - Mail Stop #662 * Memphis - Mail Stop #81 * Philadelphia - 4-N31.142 If none of the above apply, correspondence or written response to the notice is not attached, and/or, "599" is notated: 1. Move the notice to the back of the return. 2. Continue processing the return. ### Note: If the return is unsigned, but the taxpayer signed the CP notice under the jurat, it is not necessary to correspond for the signature. Letter 112C, Letter 282C, Letter 2255C, or Letter 2284C ### Note: Do not route to Statute Control Unit for clearance. See IRM 3.11.217.3.7, Statute Returns, for more information. No 1. Identify which organization initiated the letter to the taxpayer (e.g., What organization signed the letter?). 2. Route letters initiated by Accounts Management (AM) to Accounts Maintenance Research (AMRH): * Ogden - Mail Stop 6712 * Kansas City - Mail Stop N2 6800 3. Route letters initiated by Collections as follows: 1. If correspondence is attached or taxpayer’s response shows any of the following: * Taxpayer disagrees that they must file the return. * Only page one of the return is attached. * Employer Identification Number (EIN) on letter does not match EIN on return. * Return requested on letter not the same as return submitted. * Taxpayer asking question(s) or requesting the IRS take action(s) on their account. * Case involves any other IRS action(s) C&E not trained to complete. Then, Route to Compliance Services Collection Operations (CSCO). Use return address on letter: * Brookhaven - Mail Stop #662 * Memphis - Mail Stop #81 * Philadelphia - 4-N31.142 2. If none of the above apply, correspondence or written response to the letter is not attached and/or, no "599" is notated: Then, Move the letter to the back of the return and continue processing the return. ### Note: If the return is unsigned, but the taxpayer has signed the letter under the jurat, it is not necessary to correspond for the signature. Letter 2030 Initial Letter Issued to Request Verification for Unreported Income, Deductions, Payment and/or Credits on BMF Income Tax Returns Matched to Payer Information Documents Procedures No 1. Place Letter 2030 to the front of return. 2. Route letter and return to BMF Automated Underreporter (AUR) in Compliance. Letter 2531 Initial Contact for Potential Discrepancy of Income, Deductions and/or Credits Claimed on BMF Income Tax Returns Matched to Payer Information Documents Procedures No 1. Place Letter 2531 to the front of return. 2. Route letter and return to BMF Automated Underreporter (AUR) in Compliance. Includes tax liability for Multiple Tax Periods or Types of Tax No * Unnumbered Return - Prepare a dummy return if possible; otherwise, correspond. * Numbered Return - Route to Rejects. Other Tax Returns (original signature) Yes 1. Edit the received date to the detached return. 2. Route to appropriate function, unless specifically directed otherwise. ### Exception: Returns attached to a consolidated return will not be detached. Conversion of Form 1120 to Form 1120-S will not be detached. See IRM 3.11.217.4.2, Conversion of Form 1120 to Form 1120-S for more information. Statement establishing Election to be subject to the Tonnage Tax Regime - Sect 1354 No Route a copy of the election to:: Brenda E. Sarini, Internal Revenue Agent 1719 C Route 10 Parsippany, New Jersey 07054-4507 Petitions in opposition of tax law provisions Yes ### Note: Do not edit an action trail when detaching a petition. Route to: IRS ≡ ≡ ≡ ≡ ≡ ≡ 1111 Constitution Avenue, NW Washington, DC 20224 Pro Forma Form 1120 (Form 1120 with a notation of "Pro Forma" , "Pro Forma Form 1120" , "Pro Forma Form 1120 New York State" , or similar statement is notated on the return) for New York State No No action required. Prompt Assessment/Prompt Determination Request Yes/No See Form 4810, Request for Prompt Assessment Under Internal Revenue Code Section 6501(d), information below. Statement establishing Reasonable Cause for delinquent filing No 1. Issue Letter 1382C, Penalty Removal Request Incomplete. ### Exception: Do not send Letter 1382C, Penalty Removal Request Incomplete, if the taxpayer has notated "Late filed return due to CCH software outage" or similar language. 2. Continue editing the return. 3. See the following IRM references for more information: * IRM 3.11.217.14.2, CCC "D" - Reasonable Cause for Failing to Pay Timely * IRM 3.11.217.14.12 CCC "R" - Reasonable Cause for Failing to Timely File Return Remittance found No Immediately hand-carry return and remittance to supervisor. Request for e-file Waiver Statement notating: "Form 1120-S e-file Waiver Request" Yes/No * Yes - Ogden - Route request to: Mail Stop 1057. * No - Kansas City - Fax request to: 877-477-0575. Request for Form 8109 Deposit Slips, or Coupon Books No No action required. Request for Forms or Schedules No * If requesting current year forms: 1. Prepare Form 4190, Order Form for Tax Forms and Publications. 2. Forward to National Distribution Center (NDC) for processing. * If requesting prior year forms: 1. Prepare Form 6112, Prior Year Tax Products Order Form. 2. Forward to National Distribution Center (NDC) for processing. ### Note: Use the write-in sections of Form 4190 and Form 6112 for all BMF forms and schedule requests. Request for Acknowledgement No No action required. Request for Installment Agreement Yes Route as follows: * Ogden - Route to Collections Mail Stop 5500. * Kansas City - Route to Mail Stop P4 5000. Request for Information or Inquiries Yes 1. Photocopy any data necessary to process the return. 2. Attach the photocopy to the return. 3. Route original attachment to the proper office for necessary action. Request for Money Transfer Yes/No * Yes - If the taxpayer notates "Transfer of Money" (or similar language) FROM the return you are processing: 1. Edit CCC "X" to freeze overpayment. 2. Detach Transfer of Money request. 3. Prepare Form 3465, Adjustment Request, and: * Indicate in the "Routing" box "Adjustments" . * Notate the requested action in the "Remarks" box. 4. Attach Form 3465, Adjustment Request, to the Transfer of Money request and route to Accounts Management (AM). 5. Continue editing the return. * No - the taxpayer notates "Transfer of Money" (or similar language) TO the return you are processing: 1. Prepare Form 3465, Adjustment Request, and: * Indicate in the "Routing" box "Rejects" . * Notate "See attached money transfer request" in the "Remarks" box. 2. Edit Action Code 450 to route the request to Rejects. State Tax Returns Original or Copy with an original signature Yes Route to Receipt and Control. State Tax Returns (Photocopy, facsimile or no signature) No Leave attached. Indication of Final return No * Edit CCC "F" . * See IRM 3.11.217.14.4, Computer Condition Code "F" - Final Return. Notices - Payment Agreement or Disagreement with notice amount Follow local Submission Processing Campus procedures. May involve inputting a STAUP and routing attachment to another function. SS-4 Application for Employer Identification Number Yes/No * Yes - Original - Route to Entity Control. * No - Copy - No action required. Schedule D (Form 1120-S) Capital Gains and Losses and Built-in Gains No * Place in sequence order. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S, and IRM 3.11.217.30, Schedule D (Form 1120-S) - Capital Gains and Losses and Built-in Gains. Schedule F (Form 1040) Profit or Loss From Farming No * Possible Salary and Wage Code "1" . * See IRM 3.11.217.17.3, Salary and Wage Code. Schedule K-1, Form 1120-S Shareholder's Share of Income, Credits, Deductions, etc. Yes 1. Detach Schedules K-1 for current year (TY2025) and two preceding years (TY2024 and TY2023). 2. Always detach Schedules K-1 for future years. 3. See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedule K-1. 4. See the following IRM references for further instructions regarding Schedule K-1: * IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), and * IRM 3.11.217.12, Number of Shareholders - Page 1, Line I. * IRM 3.11.217.13.4, Tax Preference Code, and * IRM 3.11.217.13.6, Form 8611, Recapture of Low-Income Housing Credit, and * IRM 3.11.217.14.22, CCC "9" - Low-Income Housing Forms, and * IRM 3.11.217.17.17, Line 22 (Line 21 in 2022 prior year form revision)- Ordinary Income, and * IRM 3.11.217.24, Schedule K - Shareholders' Pro Rata Share Items, and * IRM 3.11.217.45, Schedule K-1. Schedule M-3 (Form 1120-S) Net Income (Loss) Reconciliation for S Corporations With Total Assets of $10 Million or More No * Edit CCC "B" . See IRM 3.11.217.14.1, CCC "B" - Schedule M-3. * Edit Audit Code "8" . See IRM 3.11.217.13.1, Audit Codes. Schedule N (Form 1120) Foreign Operations of U.S. Corporations No * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * See IRM 3.11.217.27, Schedule N (Form 1120) - Foreign Operations of U.S. Corporations. * Edit Audit Code "2" if Questions 1a, 3, 4a (2019 and prior revisions), 5, or 7a are answered "Yes" . * See IRM 3.11.217.13.1, Audit Codes. Form 56 Notice Concerning Fiduciary Relationship Yes 1. Edit received date. 2. Route to Entity Control. Form 433-B Collection Information Statement for Businesses Yes Route as follows: * Ogden - Route to Collections Mail Stop 5500. * Kansas City - Route to Mail Stop P4 5000 Form 433-D Installment Agreement Yes Parts 1, 2, or 3 Route as follows: * Ogden - Route to Collections Mail Stop 5500. * Kansas City - Route to Mail Stop P4 5000. ### Caution: If Parts 2 and/or 3 are present, leave attached to Part 1 when routing. Form 637 Application for Registration (For Certain Excise Tax Activities) Yes/No * Yes - TC 150 has not posted to the tax module: 1. Edit received date. 2. Route Form 637 to: Kansas City Submission Processing Campus (KCSPC), Excise Mail Stop 5701G * No - TC 150 has posted to the tax module: Route Form 637 and the return to: Kansas City Submission Processing Campus (KCSPC), Excise Mail Stop 5701G Form 843 Claim for Refund and Request for Abatement Yes 1. Edit received date. 2. Route to Accounts Management. Form 851 Affiliations Schedule No No action required. Form 911 Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order) Yes Route to Taxpayer Advocate Service (TAS). Form 926 Return by a U.S. Transferor of Property to a Foreign Corporation No * Edit Audit Code "2" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. Form 965, Inclusion of Deferred Foreign Income Upon Transition to Participation Exemption System; Form 965, Schedule A, U.S. Shareholder’s Section 965(a) Inclusion Amount; Form 965, Schedule B, Deferred Foreign Income Corporation’s Earnings and Profits (E&P); Form 965, Schedule C, U.S. Shareholder’s Aggregate Foreign Earnings and Profits Deficit; Form 965, Schedule D, U.S. Shareholder’s Aggregate Foreign Cash Position; Form 965, Schedule E, U.S. Shareholder’s Aggregate Foreign Cash Position - Detail; Form 965, Schedule F, Foreign Taxes Deemed Paid by Domestic Corporation; Form 965, Schedule G, Foreign Taxes Deemed Paid by Domestic Corporation for U.S. Shareholder Tax Year Ending in 2017; Form 965 Schedule H, Disallowance of Foreign Tax Credit and Amounts Reported on Forms 1116 and 1118; Form 965-B, Corporate and Real Estate Investment Trust (REIT) Report of Net 965 Tax Liability and Electing REIT Report of 965 Amounts No * For Tax Years 201712 through 202012, edit Computer Condition Code "J" and Action Code 460 (Management Suspense) on the return and continue processing. ### Caution: Do not correspond on Section 965 Returns. ERS will take care of any correspondence needed. * See IRM 3.11.217.2.11, Section 965 Returns (201712 through 202012), for more information. * See IRM 3.11.217.3.1, Action Codes, for more information. * See IRM 3.11.217.14.7, CCC "J" - Section 965 Tax, for more information. * See IRM 3.11.217.24.3, Schedule K, Line 10 - Other income (loss), for more information. * See IRM 3.11.217.24.4, Schedule K, Line 12d - Other deductions, for more information. * See IRM 3.11.217.24.11 ,, Line 14r - Other foreign tax information, for more information. * See IRM 3.0.101, Schedule K-1 Processing, for complete instructions to edit and process Schedule K-1. Form 966 Corporate Dissolution or Liquidation Yes/No 1. Yes - Qualified Sub chapter S Subsidiary (QSSS), Consolidation, or subsidiary is shown: * Route to Entity Control. 2. No - No indication of items above: * Possible CCC "F" * IRM 3.11.217.14.4, CCC "F" - Final Return. Form 1042 Annual Withholding Tax Return for U.S. Source Income of Foreign Persons Yes * Ogden - Route to Receipt and Control. * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 1042-S Foreign Person's U.S. Source Income Subject to Withholding No No action required. Form 1096 Annual Summary and Transmittal of U.S. Information Returns Yes Route to Receipt and Control. Form 1099 Information Return of Income and Payments (Copy A only) Yes Route to Receipt and Control. Form 1120-POL U.S. Income Tax Return for Certain Political Organizations Yes * Ogden - Route to Receipt and Control (R&C). * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 1120-X Amended U.S. Corporation Income Tax Return No Give entire return to the Lead. Form 1125-A Cost of Goods Sold No * Place Form 1125-A in sequence order if significant entries are present. * See IRM 3.11.217.34, Form 1125-A, Cost of Goods Sold. Form 1128 Application to Adopt, Change, or Retain a Tax Year No See IRM 3.11.217.6.4, Short Period - Editing Proof of Entitlement. 1. Not Approved * See IRM 3.11.217.6.6, Short Period Returns - Editing a Disapproved Application-Form 1128 2. No indication of Approval or Disapproval * See IRM 3.11.217.6.7, Short Period Returns - Editing Form 1128 With No Indication of Approval or Disapproval. Form 1138 Extension of Time for Payment of Taxes by a Corporation Expecting a Net Operating Loss Carryback Yes 1. Edit received date. 2. Route to Accounts Management. Form 1139 Corporation Application for Tentative Refund Yes 1. Edit received date. 2. Route to Accounts Management. Form 2220 Underpayment of Estimated Tax by Corporations No * Conditions may require CCC "8" . * May need to edit Form 2220, Line 38 to Form 1120-S, Line 25, if no entry is present. * See IRM 3.11.217.14.21, CCC 8 - Waiver of Estimated Tax Penalty, and IRM 3.11.217.18.10, Line 25 - Estimated Tax Penalty. Form 2553 Election by a Small Business Corporation No * Possible Action Code 347. ### Note: Action Code 347 is used to route Form 1120-S to Entity Control. * See IRM 3.11.217.3.1, Action Codes, for more information. Form 2848 Power of Attorney and Declaration of Representative Yes/No Route as follows: 1. Yes - * Ogden - Route to Mail Stop 6737. * Kansas City - Route to: Internal Revenue Service 5333 Getwell Road Mail Stop 8423 Memphis, TN 38118 2. No - No action is required if a "General Power of Attorney" , "Durable Power of Attorney" , or "Tax Information Authorization" is submitted on any document other than Form 2848 or Form 8821. Form 3115 Application for Change in Accounting Method Yes/No * Edit Audit Code "6" . See IRM 3.11.217.13.1, Audit Codes. * The original Form 3115 stays with the return. * If a duplicate Form 3115 is present, and Part I is completed, then route one copy to: Internal Revenue Service M/S 6111 Ogden, UT 84201 For Private Delivery Carriers: Internal Revenue Service 1973 N Rulon White Blvd. M/S 6111 Ogden, UT 84201 * If a duplicate Form 3115 is present, and Part I is not completed route one copy to: Internal Revenue Service CC:PA:LPD:DRU P.O. Box 7604 Ben Franklin Station Washington, DC 20044 For Private Delivery Carriers: Internal Revenue Service Attn: CC:PA:LPD:DRU Room 5336 1111 Constitution Ave., NW Washington, DC 20224 * Duplicate Form 3115 attached to a subsidiary must also be pulled and routed to the address above. Original stays with return. Form 3520 Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts Yes/No 1. Yes - If Form 3520 has an original signature: * Ogden - Route to Receipt and Control (R&C). * Kansas City - Route to Ogden Submission Processing Campus (OSPC). 2. No - If Form 3520 does not have an original signature, leave attached. Form 3520-A Annual Information Return of Foreign Trust With a U.S. Owner (Under Section 6048(b)) Yes * Ogden - Route to Receipt and Control (R&C). * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 3753 Manual Refund Posting Voucher No * Edit CCC "O" . * See IRM 3.11.217.14.10, CCC "O" - Module Freeze. Form 3800 General Business Credit No * Place in sequence order. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * See IRM 3.11.217.39, Form 3800 - General Business Credit (202301 and later). Form 3949 Information Report Referral Yes 1. Route Form 3949 according to Page 2 of Form 3949 to CI, Exam, Disclosure, etc., following local procedures. 2. Continue processing the return. Form 3949-A Information Referral Yes Route as follows: Ogden - * Route Form 3949-A to Receipt & Control. * Continue processing the return. Kansas City - * Route Form 3949-A to Ogden Service Center. * Continue processing the return. Form 4136 Credit for Federal Tax Paid on Fuels No * Perfect necessary lines. Place Form 4136, Credit for Federal Tax Paid on Fuels, in sequence order. * See IRM 3.11.217.35, Form 4136 - Credit for Federal Tax Paid on Fuels. Form 4251 Return Charge-Out No * No action required. * May be an indication not to correspond for Schedule K-1. * IRM 3.11.217.45, Schedule K-1. Form 4255 Certain Credit Recapture, Excessive Payments, and Penalties No * Place in sequence order. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * See IRM 3.11.217.44, Form 4255, Certain Credit Recapture, Excessive Payments, and Penalties (202401 and later). Form 4466 Corporation Application for Quick Refund of Overpayment of Estimated Tax No No action required. Form 4626 Alternative Minimum Tax - Corporations, for tax periods ending November 30, 2018 (201811) and prior No * Tax Cuts and Jobs Act (TCJA) of 2017 - P.L. 115-97 (H.R. 1), Section 12001 repeals the corporate alternative minimum tax (Form 4626). * Possible Tax Preference Code. * If required, edit the code as "4 - 1" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.4, Tax Preference Code. Form 4684 Casualties and Thefts No No action required. Form 4797 Sales of Business Property (Also Involuntary Conversions and Recapture Amounts Under Sections 179 and 280F(b)(2)) No * Place in sequence order if significant entries are present on Line 1b or Line 1c (2021 and later form revisions). * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * Support for Form 1120-S, Line 4. * See IRM 3.11.217.16.3, Line 4 - Net Gain/Loss and IRM 3.11.217.31, Form 4797, Sales of Business Property. Form 4810 Request for Prompt Assessment Under Internal Revenue Code Section 6501(d) Yes/No 1. Yes - TC 150 Not Posted: * Unnumbered and Numbered - Route a copy of the return and original Form 4810 to the Examination Function. Process the original return. * See IRM 3.11.217.3.10, Prompt Assessment or Prompt Determination - Form 4810. 2. No - TC 150 Posted: * Unnumbered - Route Form 4810 and return to the Examination Function. * Numbered - Edit Action Code 370. Form 4835 Farm Rental Income and Expenses (Crop and Livestock Shares (Not Cash) Received by Landowner (or Sub-Lessor) No * Possible Salary and Wage Code. * See IRM 3.11.217.17.3, Salary and Wage Code. Form 5471 Schedule E, Income, War Profits, and Excess Profits Taxes Paid or Accrued No * Possible Return Processing Code (RPC) "A" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 5471, Schedule G-1, Cost Sharing Arrangement, No Possible Return Processing Code (RPC) G. See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 5471 Schedule H, Current Earnings and Profits No * Possible Return Processing Code (RPC) "B" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 5471 Schedule I-1, Information for Global Intangible Low-Taxed Income No * Possible Return Processing Code (RPC) "C" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 5471 Schedule P, Previously Taxed Earnings and Profits of U.S. Shareholder of Certain Foreign Corporations No * Possible Return Processing Code (RPC) "D" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 5471 Information Return of U.S. Persons With Respect To Certain Foreign Corporations (Including 5471 Schedules J, M, N and O) No 1. Edit Audit Code "2" in the left margin near Line 9 (Deductions area). See IRM 3.11.217.13.1, Audit Codes. 2. Edit the Number of Forms 5471 to Line 4b of Schedule N. 3. Dummy a Schedule N if not present and edit the number of Forms 5471 to Line 4b. 4. See IRM 3.11.217.27.4, Schedule N (Form 1120), Line 4 - Form 5471, Controlled Foreign Corporation. . Form 5472 Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business (Under Sections 6038A and 6038C of the Internal Revenue Code) No * Edit Audit Code "2" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. * Possible Return Processing Code (RPC) "H" . See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 5500 Annual Return/Report of Employee Benefit Plan Yes 1. Route to the appropriate area or Submission Processing Campus. 2. Attach Form 4227, Intra-SC Reject or Routing Slip, with the following information: * Type of return * DLN * Received date * Notation of either "original" or "substitute" return Form 5713 International Boycott Report No * Keep original and copy attached. * Edit Audit Code "2" if both questions on Form 5713, Line 7(f), are answered "Yes" . * Edit Audit Code "7" if both questions on Form 5713, Line 7(f) are not answered "Yes" . * See IRM 3.11.217.13.1, Audit Codes. Form 5792 Request for IDRS Generated Refund (IGR) No * Possible CCC "O" . * See IRM 3.11.217.14.10, CCC "O" - Module Freeze. Form 5884-B New Hire Retention Credit No * The status of Form 5884-B, New Hire Retention Credit, is historical and was valid March 19, 2010, to December 31, 2010 (Tax Periods 2010 and 2011). Form 6252 Installment Sale Income No * Edit Installment Sale Indicator Code in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.3, Installment Sale Indicator for more information. * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * See _IRM 3.11.217.42_Form 6252, Installment Sale Income, for more information. Form 6478 Biofuel Producer Credit (Alcohol and Cellulosic Biofuel Fuels Credit for 2012 - 2007) No 1. Compare Form 6478 with Form 1120-S, Schedule K, Line 13f. 2. See IRM 3.11.217.24.7, Schedule K, Line 13f, - Biofuel Producer Credit. Form 6781 Gains and Losses from Section 1256 Contracts and Straddles No * Edit CCC "I" . * See IRM 3.11.217.14.6, CCC "I" - Tax Straddles and Future Contracts (Form 6781). Form 7004 Application for Automatic Extension of Time to File Certain Business Income Tax, Information, and Other Returns Yes/No * Yes - If Form 7004 is for other than the tax return or tax period being filed, route to Receipt and Control. * No - If Form 7004 is for the tax return it is attached. Form 7204, Consent to Extend the Time to Assess Tax Related to Contested Foreign Income Taxes - Provisional Foreign Tax Credit Agreement No 1. Edit RPC "L" . 2. See IRM 3.11.217.13.7, Return Processing Codes (RPC). Form 7205, Energy Efficient Commercial Buildings Deduction. No 1. Edit RPC "M" . 2. See IRM 3.11.217.13.7, Return Processing Codes (RPC). 3. IRM 3.11.217.17.14, Line 19 - Energy Efficient Commercial Buildings Deduction (Form 7205) (202301 and later). Form 8027 Employer's Annual Information Return of Tip Income and Allocated Tips Form 8027-T Transmittal for Form 8027 Yes * Ogden - Route to Receipt and Control (R&C). * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 8050 Direct Deposit of Corporate Tax Refund No * Place in sequence order if entries are present. * Continue processing the return. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. Form 8082 Notice of Inconsistent Treatment or Administrative Adjustment Request (AAR) No * Edit Audit Code "1" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. Form 8275 Disclosure Statement Form 8275-R Regulation Disclosure Statement No * Edit Audit Code "1" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. Form 8283 Noncash Charitable Contributions No 1. Edit Audit Code "C" if either: * Page 1, Part I, Question 2b, Qualified conservation contribution, is checked, * Box 2b(1), Certified historic structure, is checked or * Line 3, column (h), Qualified conservation contribution relevant basis, has an entry. 2. See IRM 3.11.217.13.1, Audit Codes. Form 8288 U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests Original - Yes * Ogden - Route to Code and Edit Foreign/FIRPTA Team. * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 8288 U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests Copy - No No action required. Form 8288-A Statement of Withholding on Certain Dispositions by Foreign Persons No * Ogden - Route to Code and Edit Foreign/FIRPTA Team. * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 8288-B Application for Withholding Certificate for Dispositions by Foreign Persons of U.S. Real Property Interests Original - Yes * Ogden - Route to Code and Edit Foreign/FIRPTA Team. * Kansas City - Route to Ogden Submission Processing Campus (OSPC). Form 8288-B Application for Withholding Certificate for Dispositions by Foreign Persons of U.S. Real Property Interests Copy - No No action required. Form 8404 Interest Charge on DISC-Related Deferred Tax Liability Yes * Ogden - Route to Kansas City Submission Processing Campus (KCSPC). * Kansas City - Route to Receipt and Control (R&C). Form 8586 Low-Income Housing Credit No * Possible CCC "9" . * See IRM 3.11.217.14.22, CCC "9" - Low-Income Housing Forms. * Follow editing procedures in IRM 3.11.217.13.5, Form 8586, Low-Income Housing Credit. Form 8594 Asset Acquisition Statement Under Section 1060 No * Edit Audit Code "3" if Form 8594 has an amount ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ in Box 3. * See IRM 3.11.217.13.1, Audit Codes. Form 8609 Low-Income Housing Credit Allocation and Certification Form 8609-A (prior year Form 8609 Schedule A) Annual Statement for Low-Income Housing Credit No * Edit CCC "9" . * See IRM 3.11.217.14.22, CCC "9" - Low-Income Housing Forms. Form 8611 Recapture of Low-Income Housing Credit No 1. Edit Line 14, Form 8611 in the left margin near Line 9 (Deductions area). 2. Edit as "6 -" followed by the credit amount. 3. Follow editing procedures in IRM 3.11.217.13.6, Form 8611, Recapture of Low-Income Housing Credit. 4. Edit CCC "9" . 5. See IRM 3.11.217.14.22, CCC "9" - Low-Income Housing Forms. Form 8621 Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund No * Edit Audit Code "2" if Form 8621, Part V (Distributions From and Dispositions of Stock of a Section 1291 Fund), Lines 15a through Line 16f has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡. * Edit Audit Code "7" if Form 8621, Part V (Distributions From and Dispositions of Stock of a Section 1291 Fund), Lines 15a through Line 16f has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡. * See IRM 3.11.217.13.1, Audit Codes. Form 8697 (Refund) Interest Computation Under the Look-Back Method for Completed Long-Term Contracts Yes If Form 8697, Part I, Line 9 or Form 8697, Part II, Line 10 shows a refund, then do the following: 1. Edit tax period, EIN, and received date on Form 8697, if not already present. 2. Route to Accounts Management (AM). Form 8716 Election To Have a Tax Year Other Than a Required Tax Year No See IRM 3.11.217.6.4 Short Period - Editing Proof of Entitlement. Form 8752 Required Payment or Refund Under Section 7519 Yes/No KCSPC and OSPC: Yes: Original - Route to Receipt and Control. No: Copy - No action required. Form 8821 Tax Information Authorization Yes/No Route as follows: 1. Yes - * Ogden - Route to Mail Stop 6737. * Kansas City - Route to: Internal Revenue Service 5333 Getwell Road Mail Stop 8423 Memphis, TN 38118 2. No - No action is required if a "General Power of Attorney" , "Durable Power of Attorney" , or "Tax Information Authorization" is submitted on any document other than Form 2848 or Form 8821. Form 8822 Change of Address, or Form 8822-B Change of Address or Responsible Party - Business Yes/No 1. Yes - If any of the following applies: * Mailing address information is different, * Location address is listed on Form 8822/8822-B, Line 7, * An entry is listed on Form 8822-B, Lines 8 or 9, Then detach Form 8822 or Form 8822-B and route to Entity Control following local procedures using Form 13934, Entity Document/C&E Merge Transmittal. 2. No - If all the following applies: * Mailing address information is the same, * No location address is listed on Form 8822/8822-B, Line 7, * No entry on Form 8822-B, Lines 8 or 9, Then take no action. 3. See IRM 3.11.217.5.6(3), Entity Perfection-Domestic Addresses, for more information. ### Note: A business may have two addresses. One is the mailing address and the other is the location address or physical location of the business. Form 8824 Like-Kind Exchanges (and section 1043 conflict-of-interest sales) No * If Form 8824 is attached, edit CCC "1" . * See IRM 3.11.217.14.18, CCC "1" - Like-Kind Exchanges. Form 8825 Rental Real Estate Income and Expenses of a Partnership or an S Corporation No * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * Form 8825 - Compute Line 2, Columns A through H and enter on Line 18a of Form 8825. * See IRM 3.11.217.28, Form 8825 - Rental Real Estate Income and Expenses of a Partnership or an S Corporation. Form 8832 Entity Classification Election No * Edit Audit Code "2" if Form 8832 is attached and Box 6(d), (e), or (f) is checked. * See IRM 3.11.217.13.1, Audit Codes. Form 8833 Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b) No * Edit CCC "L" . * See IRM 3.11.217.14.8, CCC "L" - Treaty Based Positions. * Edit Audit Code "2" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. Form 8858 Information Return of U.S. Persons With Respect To Foreign Disregarded Entities (FDEs) and Foreign Branches (FB) No * Edit Audit Code "2" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. Form 8865 Return of U.S. Persons With Respect to Certain Foreign Partnerships No * Edit Audit Code "2" in the left margin near Line 9 (Deductions area). * See IRM 3.11.217.13.1, Audit Codes. * Edit the number of Forms 8865 to Line 2 of the Schedule N. * Dummy a Schedule N if not present and edit the number of Forms 8865 to Line 2. * See IRM 3.11.217.27.3, Schedule N (Form 1120), Line 3 - Form 8865 Question. Form 8865 Schedule G, Statement of Application of the Gain Deferred Method Under Section 721(c) No * Possible Return Processing Code (RPC) "E" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 8865 Schedule H, Acceleration Events and Exceptions Reporting Relating to Gain Deferral Method Under Section 721(c) No * Possible Return Processing Code (RPC) "F" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 8866 (Refund) Interest Computation Under the Look-Back Method for Property Depreciated Under the Income Forecast Method Yes If Form 8866, Line 9 shows a refund, then do the following: 1. Edit tax period, EIN, and received date on Form 8866, if not already present. 2. Route to Accounts Management (AM). Form 8866 (Balance Due) Interest Computation Under the Look-Back Method for Property Depreciated Under the Income Forecast Method No No action required. Form 8869 Qualified Subchapter S Subsidiary Election Yes/No * Yes - Original - Route to Entity Control. * No - Copy - If a copy is present, or a Form 8869 is stamped “IRS Accepted”, “IRS Approved”, (or similar language), then no action is required. Form 8870 Information Return for Transfers Associated With Certain Personal Benefit Contracts (Under section 170(f)(10)) Yes Route to: EO Entity IRS Ogden Campus Mail Stop 6273 Form 8871 Political Organization Notice of Section 527 Status Yes Route to Receipt and Control to be re-batched. Form 8872 Political Organization Report of Contributions and Expenditures Yes Route to Receipt and Control to be re-batched. Form 8873 Extraterritorial Income Exclusion No 1. Edit the number of Form(s) 8873 attached to Line 7b, Schedule N. 2. See IRM 3.11.217.27.8, Schedule N (Form 1120), Line 7b - Number of Forms 8873. 3. Edit the total of Line 52 of all attached Form 8873 to Line 7c, Schedule N. 4. Dummy a Schedule N if not present and edit the number of Forms 8873 to Line 7b and edit the total amount from Line 52, Form 8873 to Line 7c, Schedule N. 5. See IRM 3.11.217.27.9, Schedule N (Form 1120), Line 7c - Total Extraterritorial Income Exclusion. 6. Input Command Code (CC) REQ77 / FRM77 with IDRS Transaction Code (TC) "971" and appropriate IDRS Action Code depending on which election was made. 7. See IRM 3.11.217.29, Form 8873, Extraterritorial Income Exclusion. Form 8875 Taxable REIT Subsidiary Election (Under section 856(I)(1) of the Internal Revenue Code) Yes/No KCSPC and OSPC: Yes: Original - Route to OSPC BMF Entity - Mail Stop 6273. No: Copy - No action required. ### Note: Form 8875 is processed at OSPC only. Form 8883 Asset Allocation Statement Under Section 338 No * Edit CCC "S" if Form 8883 is attached. * See IRM 3.11.217.14.13, CCC "S" - Form 8883, Asset Allocation Statement Under Section 338. * Edit Audit Code "3" if Form 8883 has an amount of ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ in Box 5a. * See IRM 3.11.217.13.1, Audit Codes. Form 8886 Reportable Transaction Disclosure Statement No * Edit CCC "T" . * See IRM 3.11.217.14.14, CCC "T" - Form 8886, Reportable Transaction Disclosure Statement. * Edit Audit Code "1" if Form 8886 is attached. * See IRM 3.11.217.13.1, Audit Codes. Form 8913 Credit for Federal Telephone Excise Tax Paid Only Tax Return No This credit was used for tax periods 200612 - 200711. Form 8936, Schedule A, Clean Vehicle Credit Amount No * Place in sequence order. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * See IRM 3.11.217.43, Form 8936, Schedule A, - Clean Vehicle Credit Amount (202301 and later) for more information. Form 8938 Statement of Specified Foreign Financial Assets No * Edit CCC "2" if Form 8938, Statement of Specified Foreign Financial Assets, is attached to Form 1120-S. See IRM 3.11.217.14.19, CCC "2" - Form 8938, Statement of Specified Foreign Financial Assets. * See IRM 3.11.217.27.10, Schedule N (Form 1120), Line 8 - Statement of Specified Foreign Financial Assets, and IRM 3.11.217.46, Form 8938, Statement of Specified Foreign Financial Assets, for more information. * Place in sequence order. See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. Form 8941 Credit for Small Employer Health Insurance Premiums No * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - 1120-S, and IRM 3.11.217.37, Form 8941 - Credit for Small Employer Health Insurance Premiums. Form 8949 Sales and Other Dispositions of Capital Assets No Edit CCC "M" when: * Tax period ending is 201712 and later, and * Form 8949, Sales and Other Dispositions of Capital Assets, contains a code "Z" and/or "Y" in Column (f). * See IRM 3.11.217.14.9, CCC "M" - Form 8949 Sales and Other Dispositions of Capital Assets. * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. Form 8990 Limitation on Business Interest Expense Under Section 163(j) No * Possible Return Processing Code (RPC) "7" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 8992 U.S. Shareholder Calculation of Global Intangible Low-Taxed Income (GILTI) No * Possible Return Processing Code (RPC) "2" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 8994 Employer Credit for Paid Family and Medical Leave No * Possible Return Processing Code (RPC) "4" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. Form 8996 Qualified Opportunity Fund No * Possible Return Processing Code (RPC) "6" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. * See IRM 3.11.217.23.2, Form 8996 - Qualified Opportunity Fund Checkbox, for more information. Form 8997 Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments No * Possible Return Processing Code (RPC) "9" . * See IRM 3.11.217.13.7, Return Processing Code (RPC), for more information. * Place in sequence order if significant entries are present. * See IRM 3.11.217.15.1, Sequence of Return - Form 1120-S. Form 9465 Installment Agreement Request Yes Route as follows: * Ogden - Route to Collections Mail Stop 5500. * Kansas City - Route to Mail Stop P4 5000. Form 12857 Refund Transfer Posting Voucher No * Possible CCC "O" . * See IRM 3.11.217.14.10, CCC "O" - Module Freeze. Form 14039-B Business Identity Theft Affidavit No 1. If a specific function is indicated by the envelope address or an IRS CP notice or an IRS letter: * Place the Form 14039-B on top of the return and * Route Form 14039-B and the return to the specific function 2. If Ogden or Kansas City receives a Form SS-4, Application for Employer Identification Number, and Form 14039-B, route the returns to: Internal Revenue Service Ogden BMF Entity. Mail Stop 6273 Ogden, UT 84201 3. For the following returns: * Loose Form 14039-B * No correspondence attached (e.g., no IRS CP notice or IRS letter) * The envelope is not addressed to a specific function Place the Form 14039-B on top of the return and route to the local Image Control Team (ICT). * Ogden - Mail Stop 6552 * Kansas City - Mail Stop C1 6525 Form 14157 Return Preparer Complaint Yes Route to: Attn: Return Preparer Office 401 W. Peachtree Street NW Mail Stop 421-D Atlanta, Georgia 30308 Schedule K-2 Shareholders’ Pro Rata Share Items - International No Added to Mail Routing Guide for information purpose only. Schedule K-3 Shareholders’ Share of Income, Deductions, Credits, etc. - International No Added to Mail Routing Guide for information purpose only.
Exhibit 3.11.217-4
Form 8996 - Prior Year Conversion Chart
2020 and 2019 Tax Periods
Part II Change Line 6 to 7 Change Line 7 to 8 Change Line 9 to 10 Change Line 10 to 11 Part III Change Line 13 to 14 Change Line 14 to 15 2018 and 2017 Tax Periods
| Part II |
|---|
| Change Line 5 to 7 |
| Change Line 6 to 8 |
| Change Line 8 to 10 |
| Change Line 9 to 11 |
| Part III |
|---|
| Change Line 12 to Line 14 |
| Change Line 13 to Line 15 |
Exhibit 3.11.217-5
♦Potential Frivolous Arguments for Examination Review♦
| Potential Frivolous Argument | Description |
|---|---|
| Alleged Churches/First Amendment | Income from non-religious sources and may claim a vow of poverty. |
| Altered Form | Altering any or all line items with the intent of facilitating non-compliance with the tax laws. |
| Altered Jurat/Uniform Commercial Code (UCC) 1-207 or UCC 1-308 | Return has income and deductions but the jurat is altered or stricken. May include reference to UCC 1-207/UCC 1-308 or a statement that the return was not signed under penalties of perjury. |
| Amended Returns/Form 843 Claim | Amended return or a Form 843, Claim for Refund and Request for Abatement, filed to obtain a total refund of all taxes paid in prior years, based on a tax avoidance argument. |
| C-Filings | This frivolous position includes the following four categories: 1. Files a return claiming several types of deductions, credits, or overpayments/refunds that have no relation to reality and because of their outrageous character, qualify as frivolous returns. 2. Files a return containing the filers identifying information but does not request a refund, often lacking sufficient information to determine a tax liability. 3. Files a return with several types of rambling dialogue or confusing arguments that no one could reasonably view as a good faith effort to comply with the law. 4. Files a return that tries to send some type of message or protest to the IRS, but does not include sufficient identifying information for the IRS to either determine the identity of the taxpayer or correspondent or return address. |
| Challenges to Authority/Due Process | Questions several administrative authorities such as delegation orders, summons authority, Privacy Act, etc. Argues that they must be afforded a hearing or a trial before taxes can be assessed or before property can be seized. |
| Challenges to Authority/Title 26 or "law" in Other Documents | Argues that Title 26 of the United States Code is not law because it was never enacted as named. |
| Collections Issues | Files frivolous documents contending that several collections issues are invalid (e.g., Offers in Compromise, Collection Due Process Requests, Installment Agreements, Appeals Requests, etc.) because they are not filed and signed by someone with delegated authority. They may have no certificate of assessment attached, do not comply in form or content with a State or Local law, are not in a certain format, or lack a valid Office of Management and Budget (OMB) number, or other frivolous positions. |
| Disclaimer | Submits a disclaimer stating, "disclaims the liability for the tax due" , making the liability on the return zero. |
| Fifth Amendment | Assertion of the Fifth Amendment right against self-incrimination as a basis for not providing any financial information. |
| Foreign Income | Argues that United States citizens and residents are not subject to tax on their wages or other income derived from sources within the United States, as only foreign-based income or income received by nonresident aliens and foreign S Corporations from sources within the United States is taxable. |
| Form 1099-OID (Original Issue Discount) | An individual or business files a return reporting false amounts of income (Generally "Other" or "Miscellaneous" income) and claims a false amount of income tax withholding approximately equal to the amount of falsely reported income. Although the returns report income, they do not calculate any tax due. Some of the returns have Form 1099-OID attached and some have Form 1096, Annual Summary and Transmittal of U.S. Information Returns. Other false financial instruments may be filed in the place of or in addition to the Form 1099-OID such as Form 2439, Notice to Shareholder of Undistributed Long-Term Capital Gains, promissory notes, bonds, sight drafts, etc. |
| IRC 861 Business Employment Tax (BMF 861) | Argument targets employers and advises them that wages are exempt from withholding. These taxpayers rely on Sections 861 through 865 of the Code and the regulations (in particular, Treasury Regulation 1.861-8), promoters of this scheme advise employers to stop withholding and paying payroll taxes on their employee's wages. In addition, some employers file amended payroll tax returns and request refunds of previously paid payroll taxes. |
| IRS is a Private Organization/Collects Tribute, Not Taxes | Argues that the IRS is an entity named the Internal Revenue and Tax Service, Inc., which was incorporated in Delaware in 1933, it is a collection agency for the Federal Reserve Bank, or is part of the United Nations and is clandestinely leading the tax-paying public into a "new world order" . |
| Not a Person | Argues that a taxpayer is not a "person" within the meaning of IRC 7701(a)(14). |
| Obscene, Vulgar, Harassing | Submits documents or other materials indicating that non-filing is due to dissatisfaction with tax policies or taxation in general. Often, this argument is expressed with obscene, vulgar, or crude language and characters in an extremely demeaning manner. |
| Protest Against Government Action/Inaction | Argues that refusal to file or pay is justified because they disagree with government policies or spending plans. |
| Sixteenth Amendment | Argues the Sixteenth Amendment was not properly ratified and therefore the federal government does not have the legal authority to collect an income tax without apportionment. |
| Straw Men | Argues the government has created an entity separate and distinct from the taxpayer - a "straw man" and any tax obligations are exclusively those of the "straw man" . |
| Taxes are Voluntary/Law Does Not Require | Submits a return, Amended return or correspondence that argues income taxes are voluntary. |
| U.S. vs. Long | Submits a return with zero money amounts. To explain the zeros inserted on the form the individual references "U.S. vs. Long" . |
| Unsigned Returns | The individual completes a return but does not sign. A statement indicating disagreement with the tax system is attached or added to the return. |
| Valuation | Income is not taxable because of the declining fair market value of the dollar, because the dollar is not backed by gold/silver, because the value of services is offset by the value of the labor (barter income), etc. |
| Zero Returns | Submits a return with zero money amounts on all or most line items on the form (e.g., IRC 861, Form 2439, OID, and other BMF filings that claim no income and request refunds). See Revenue Ruling 2004-34. A statement is attached claiming there is no section of the Internal Revenue Code that established an income tax liability. The statement contains arguments about the definition of income. There are several variations on this type of filing such as those bearing the words "nunc pro tunc" and "not liable" . ### Note: Returns having only zeros, no entries, are blank, or show "None" , "Not Liable" , etc. with no evidence of a frivolous argument are not to be considered as frivolous returns. |
| Other | All others including those in Notice 2010-33 or any later superseding notice. See also The Truth About Frivolous Tax Arguments on irs.gov. This category includes non-filer accounts resulting from initial compliance check such as cross-reference Taxpayer Identification Numbers (TINs). ### Note: Frivolous arguments citing "Collection Due Process" (CDP) must be reviewed by Collections for possible referral to Appeals. Refer to IRM 5.19.8, Collection Appeal Rights, for more information. |
Exhibit 3.11.217-6
♦Province, Foreign State and Territory Abbreviations♦
Australia State
| Australia State | Abbreviation |
|---|---|
| Australian Capital Territory | ACT |
| New South Wales | NSW |
| Northern Territory | NT |
| Queensland | QLD |
| South Australia | SA |
| Tasmania | TAS |
| Victoria | VIC |
| Western Australia | WA |
Brazil State
| Brazil State | Abbreviation |
|---|---|
| Acre | AC |
| Alagoas | AL |
| Amapa | AP |
| Amazonas | AM |
| Bahia | BA |
| Ceara | CE |
| Distrito Federal | DF |
| Espirito Santo | ES |
| Goias | GO |
| Maranhao | MA |
| Mato Grosso | MT |
| Mato Grosso do Sul | MS |
| Minas Gerais | MG |
| Parana | PR |
| Paraiba | PB |
| Para | PA |
| Pernambuco | PE |
| Piaui | PI |
| Rio Grande do Norte | RN |
| Rio Grande do Sul | RS |
| Rio de Janeiro | RJ |
| Rondonia | RO |
| Roraima | RR |
| Santa Catarina | SC |
| Sergipe | SE |
| Sao Paulo | SP |
| Tocantins | TO |
Canada Province/Territory
| Canada Province/Territory | Abbreviation |
|---|---|
| Alberta | AB |
| British Columbia | BC |
| Manitoba | MB |
| New Brunswick | NB |
| Newfoundland and Labrador | NL |
| Northwest Territories | NT |
| Nova Scotia | NS |
| Nunavut | NU |
| Ontario | ON |
| Prince Edward Island | PE |
| Quebec | QC |
| Saskatchewan | SK |
| Yukon | YT |
Cuba Province
| Cuba Province | Abbreviation |
|---|---|
| Camaguey | CG |
| Ciego de Avila | CA |
| Cienfuegos | CF |
| Ciudad di La Habana | CH |
| Granma (Bayamo) | GR |
| Guantanamo | GT |
| Holguin | HO |
| La Habana | HA |
| Matazas | MT |
| Municipio Especial Isla de la Juventud | IJ |
| Pinar del Rio | PR |
| Sancti Spiritus | SS |
| Santiago de Cuba | SC |
| (Victoria de) Las Tunas | LT |
| Villa Clara | VC |
Italy Province
| Italy Province | Abbreviation |
|---|---|
| Agrigento | AG |
| Alessandria | AL |
| Ancona | AN |
| Aosta/Aoste | AO |
| Arezzo | AR |
| Ascoli Piceno | AP |
| Asti | AT |
| Bari | BA |
| Belluno | BL |
| Benevento | BN |
| Bergamo | BG |
| Biella | BI |
| Bologna | BO |
| Bolzano Bozen | BZ |
| Brescia | BS |
| Brindisi | BR |
| Cagliari | CA |
| Caltanissetta | CL |
| Campobasso | CB |
| Caserta | CE |
| Catania | CT |
| Catanzaro | CZ |
| Chieti | CH |
| Como | CO |
| Cosenza | CS |
| Cremona | CZ |
| Crotone | KR |
| Cuneo | CN |
| Enna | EN |
| Ferrara | FE |
| Firenze | FI |
| Foggia | FG |
| Forli | FO |
| Frosinone | FR |
| Genoa | GE |
| Gorizia | GO |
| Grosseto | GR |
| Imperia | IM |
| Isernia | IS |
| L'Aquila | AQ |
| La Spezia | SP |
| Latina | LT |
| Lecce | LE |
| Livorno | LI |
| Lodi | LO |
| Lucca | LU |
| Macerata | MC |
| Mantova | MN |
| Massa-Carrara | MS |
| Matera | MT |
| Messina | ME |
| Milan | MI |
| Modena | MO |
| Napoli | NA |
| Novara | NO |
| Nuoro | NU |
| Oristano | OR |
| Padova | PD |
| Palermo | PA |
| Parma | PR |
| Pavia | PV |
| Perugia | PG |
| Pesaro-Urbino | PS |
| Pescara | PE |
| Piacenza | PC |
| Pisa | PI |
| Pistoia | PT |
| Pordenone | PN |
| Potenza | PZ |
| Prato | PO |
| Ragusa | RG |
| Pavenna | RA |
| Peggio de Calabria | RC |
| Reggio nell'Emilia | RE |
| Rieti | RI |
| Rimini | RN |
| Roma | RM |
| Rovigo | RO |
| Salerno | SA |
| Sassari | SS |
| Savona | SV |
| Siena | SI |
| Siracusa | SR |
| Sondrio | SO |
| Taranto | TA |
| Teramo | TE |
| Terni | TR |
| Torino | TO |
| Trapani | TP |
| Trento | TN |
| Treviso | TV |
| Trieste | TS |
| Udine | UD |
| Varese | VA |
| Venezia | VE |
| Verbania | VB |
| Vercelli | VC |
| Verona | VR |
| Vibo Valentia | VV |
| Vincenza | VI |
| Viterbo | VT |
Mexico State
| Mexico State | Abbreviation |
|---|---|
| Aguascalientes | AGS |
| Baja California Norte | BCN |
| Baja California Sur | BCS |
| Campeche | CAM |
| Chiapas | CHIS |
| Chihuahua | CHIH |
| Coahuila | COAH |
| Colima | COL |
| Distrito Federal | DF |
| Durango | DGO |
| Guanajuato | GTO |
| Guerrero | GRO |
| Hidalgo | HGO |
| Jalisco | JAL |
| Mexico | MEX |
| Michoacan | MICH |
| Morelos | MOR |
| Nayarit | NAY |
| Nuevo Leon | NL |
| Oaxaca | OAX |
| Puebla | PUE |
| Queretaro | QRO |
| Quintana ROO | QROO |
| San Luis Potosi | SLP |
| Sinaloa | SIN |
| Sonora | SON |
| Tabasco | TAB |
| Tamaulipas | TAMPS |
| Tlaxcala | TLAX |
| Veracruz | VER |
| Yucatan | YUC |
| Zacatecas | ZAC |
The Netherlands Province
| The Netherlands Province | Abbreviation |
|---|---|
| Drenthe | DR |
| Flevoland | FLD |
| Friesland | FR |
| Gelderland | GLD |
| Groningen | GN |
| Limburg | LB |
| North Brabant | NB |
| North Holland | NH |
| Overijssel | OV |
| South Holland | ZH |
| Utrecht | UT |
| Zeeland | SLD |
Exhibit 3.11.217-7
♦U.S. Possessions ZIP Codes♦
American Samoa (AS)
| American Samoa (AS) City | American Samoa (AS) ZIP Code |
|---|---|
| Faga'itua | 96799 |
| Leone | 96799 |
| Olosega Manua' | 96799 |
| Pago Pago | 96799 |
Federated States of Micronesia (FM)
| Federated States of Micronesia (FM) City | Federated States of Micronesia (FM) ZIP Code |
|---|---|
| Chuuk | 96942 |
| Kosrae | 96944 |
| Pohnpei | 96941 |
| Yap | 96943 |
Guam (GU)
| Guam (GU) City | Guam (GU) ZIP Code |
|---|---|
| Agana | 96910 |
| Inarajan | 96917 |
| Merizo | 96916 |
| Tamuning | 96931 |
| Umatac | 96915 |
| Yona | 96915 |
Marshall Islands (MH)
| Marshall Islands (MH) City | Marshall Islands (MH) ZIP Code |
|---|---|
| Ebeye | 96970 |
| Majuro | 96960 |
Northern Marianna Islands (MP)
| Northern Marianna Islands (MP) City | Northern Marianna Islands (MP) ZIP Code |
|---|---|
| Capitol Hill | 96950 |
| Rota | 96951 |
| Saipan | 96950 |
| Tinian | 96952 |
Palau (PW)
| Palau (PW) City | Palau (PW) ZIP Code |
|---|---|
| Koror | 96940 |
| Palau | 96940 |
Puerto Rico (PR)
| Puerto Rico (PR) City | Puerto Rico (PR) ZIP Code |
|---|---|
| Adjuntas | 00601 |
| Aguada | 00602 |
| Aguadilla | 00603 |
| Aguas Buenas | 00703 |
| Aguirre | 00704 |
| Aibonito | 00705 |
| Anasco | 00610 |
| Angeles | 00611 |
| Arecibo | 00612 |
| Arroyo | 00714 |
| Bajadero | 00616 |
| Barceloneta | 00617 |
| Barranquitas | 00794 |
| Barrio Obrero Station | 00935 |
| Bayamon | 00956 |
| Boqueron | 00622 |
| Cabo Rojo | 00623 |
| Caguas | 00725 |
| Camuy | 00627 |
| Canovanas | 00729 |
| Caparra Heights | 00920 |
| Carolina | 00982 |
| Catano | 00962 |
| Cayey | 00736 |
| Ceiba | 00735 |
| Cerro Gordo | 00754 |
| Ciales | 00638 |
| Cidra | 00739 |
| Coamo | 00769 |
| Comerio | 00782 |
| Condado | 00907 |
| Corozal | 00783 |
| Coto Laurel | 00780 |
| Culebra | 00775 |
| Dorado | 00646 |
| Ensenada | 00647 |
| Esperanza | 00765 |
| Fajardo | 00738 |
| Fernandez Juncos | 00936 |
| Florida | 00650 |
| Fort Buchanan | 00934 |
| Garrachales | 00652 |
| Guanica | 00653 |
| Guayama | 00784 |
| Guayanilla | 00656 |
| Guaynabo | 00965 |
| Gurabo | 00778 |
| Hatillo | 00659 |
| Hato Rey | 00936 |
| Hormigueros | 00660 |
| Humacao | 00791 |
| Isabela | 00662 |
| Jayuya | 00664 |
| Juana Diaz | 00795 |
| Juncos | 00777 |
| La Cumbre | 00926 |
| Lajas | 00667 |
| La Plata | 00786 |
| Lares | 00669 |
| Las Marias | 00670 |
| Las Piedras | 00771 |
| Levittown | 00949 |
| Loiza | 00772 |
| Loiza Street Station | 00936 |
| Luquillo | 00773 |
| Manati | 00674 |
| Maricao | 00606 |
| Maunabo | 00707 |
| Mayaguez | 00680 |
| Mercedita | 00715 |
| Minillas Center | 00936 |
| Moca | 00676 |
| Morovis | 00687 |
| Naguabo | 00718 |
| Naranjito | 00719 |
| Orocovis | 00720 |
| Palmer | 00721 |
| Patillas | 00723 |
| Penuelas | 00624 |
| Ponce | 00731 |
| Puerta de Tierra | 00936 |
| Puerta Real | 00740 |
| Punta Santiago | 00741 |
| Quebradillas | 00678 |
| Ramey | 00603 |
| Rincon | 00677 |
| Rio Blanco | 00744 |
| Rio Grande | 00721 |
| Rio Piedras | 00927 |
| Rosario | 00636 |
| Sabana Grande | 00637 |
| Sabana Hoyos | 00688 |
| Sabana Seca | 00952 |
| Saint Just | 00978 |
| Salinas | 00751 |
| San Antonio | 00690 |
| San Francisco | 00927 |
| San German | 00683 |
| San Juan | 00936 |
| San Lorenzo | 00754 |
| San Sebastian | 00685 |
| Santa Isabel | 00757 |
| Santurce | 00936 |
| Toa Alta | 00953 |
| Toa Baja | 00949 |
| Trujillo Alto | 00976 |
| University | 00936 |
| Utuado | 00641 |
| Vega Alta | 00692 |
| Vega Baja (Box 1 - 9049) | 00694 |
| Vieques | 00765 |
| Villalba | 00766 |
| Yabucoa | 00767 |
| Yauco | 00698 |
Virgin Islands - U.S. (VI)
| Virgin Islands - U.S. (VI) City | Virgin Islands - U.S. (VI) ZIP Code |
|---|---|
| Charlotte Amalie | 00802 |
| Christiansted | 00820 |
| Cruz Bay | 00830 |
| Downtown | 00840 |
| Frederiksted | 00840 |
| Kingshill | 00850 |
| Saint Croix | 00820 |
| Saint John | 00830 |
| Saint Thomas | 00805 |
| Sunny Isle | 00850 |
| Veterans Annes | 00820 |
Exhibit 3.11.217-8
♦USPS.com Track & Confirm Record♦
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Exhibit 3.11.217-9
Form 3800 - Prior Year Revisions Comparison Chart
See Form 3800, Part III, revision(s) below.
| Form, Line Number | 2023 | 2024 |
|---|---|---|
| Form 7207, Line 1b | * Column (b) * Column (g) * Column (h) * Column (i) * Column (j) | * Column (b) * Column (f) * Column (h) * Column (j) * Column (g) |
| Form 3468, Part III, Line 1d | * Column (b) * Column (g) * Column (j) | * Column (b) * Column (f) * Column (g) |
| Form 8835, Part II, Line 1f | * Column (b) * Column (g) * Column (j) | * Column (b) * Column (f) * Column (g) |
| Form 7210, Line 1g | * Column (b) * Column (g) * Column (h) * Column (i) * Column (j) | * Column (b) * Column (f) * Column (h) * Column (j) * Column (g) |
| Form 3468, Part IV, Line 1o | * Column (b) * Column (h) * Column (i) * Column (j) | * Column (b) * Column (h) * Column (j) * Column (g) |
| Form 7218, Part II, Line 1q | NEW in 2024 | * Column (b) * Column (g) * Column (j) * Column (h) * Column (i) |
| Form 8911, Part I, Line 1s | * Column (b) * Column (g) * Column (j) | * Column (b) * Column (f) * Column (g) |
| Form 7213, Part II, Line 1u | * Column (b) * Column (g) * Column (j) | * Column (b) * Column (f) * Column (g) |
| Form 3468, Part V, Line 1v | New in 2024 | * Column (b) * Column (f) * Column (g) |
| Form 8933, Line 1x | * Column (b) * Column (g) * Column (h) * Column (i) * Column (j) | * Column (b) * Column (f) * Column (h) * Column (j) * Column (g) |
| Form 8936, Part V, Line 1aa | * Column (b) * Column (j) | * Column (b) * Column (g) |
| Form 7211, Part II, Line 1gg | New in 2024 | * Column (b) * Column (f) * Column (g) |
| Form 3468, Part VI, Line 4a | * Column (b) * Column (g) * Column (j) | * Column (b) * Column (f) * Column (g) |
| Form 8835, Part II, Line 4e | * Column (b) * Column (g) * Column (j) | * Column (b) * Column (f) * Column (g) |