Acknowledgments of Transmitted Return Data
The receipt of all transmissions will be electronically acknowledged by the IRS and will be either rejected for a specific reason or accepted. An accepted return may be questioned later since “acceptance” by the IRS indicates that the return meets the processing criteria. These “accepted returns” are considered “filed” as soon as the return is signed electronically. On the other hand, rejected returns do not meet processing criteria and are considered “not filed.” When the IRS acknowledges a rejected return, the acknowledgment identifies the source of the problem using a system of error reject codes and form field numbers (sequence numbers). The error reject codes tell why the return rejected and the form field numbers refer to the fields of the electronic return data that are involved.
Other information useful to the originator is included in the acknowledgment record of an accepted individual return. This record will confirm the following:
IRS acceptance of a PIN,
Whether the taxpayer’s refund has been applied to a debt (such as student loan or past-due tax liabilities),
If an elected electronic funds withdrawal paid a balance due, and
Whether the IRS approved a request for a Form 4868 extension.
EROs should check acknowledgment records regularly to identify returns that require follow up action. If follow up actions are required to address issues identified on acknowledgment records, the ERO should take reasonable steps to accomplish such actions. An example would be if the IRS rejects a return because a dependent’s name does not match the IRS Master File (A centralized IRS database containing taxpayers’ personal return information). If this occurred, the ERO should contact the taxpayer to get the correct information for the dependent and resubmit the return electronically as soon as possible.
At the request of the taxpayer, the ERO must provide the Submission ID and the date that the IRS accepted the electronic individual income tax return data. Submission ID’s is a unique 20-digit number assigned to electronically filed tax returns. Form 9325, Acknowledgment and General Information for Taxpayers Who File Returns Electronically, may be used by the ERO to satisfy this requirement. In addition, the ERO must, if requested, supply the electronic postmark if the Transmitter provided one for the return.
Electronic individual income tax return data, if rejected, can be corrected and retransmitted without new signatures or authorizations if changes do not differ from the amount in the electronic portion of the electronic return by more than a specific amount. These differences, depending on the item, will be limited to the following amounts:
$50 for “total income” or “AGI,”
$14 for “total tax,” “Federal income tax withheld,” “refund,” or “amount you owe.”
The new electronic return data must be given to the taxpayer, and new signatures are required. The taxpayer must be furnished with copies of the new signatures.
Rejected Federal electronic return data due to errors may also cause the state electronic return data to reject. The reverse situation may also be true since both Federal and state electronic return data must be accepted by the IRS. In the reverse situation, if the state electronic return data is rejected by the IRS due to error, the Federal electronic return data may also reject. Once the IRS accepts both, a subsequent rejection of state electronic return data by a state tax administration agency will not affect the accepted Federal electronic return data. Once the state receives electronic return data from the Federal/State e-file* Program, the state will determine whether that data is accepted as filed. The state tax administration agency should be contacted when problems or questions arise.
Resubmission of Rejected Tax Returns
In some situations, the electronic portion of a taxpayer’s individual income tax return may be rejected by IRS for processing, and the reason for the rejection may be one that cannot be rectified. If this happens, the ERO must take reasonable steps to inform the taxpayer of the rejection within 24 hours. When the ERO advises the taxpayer that the return has not been filed, the ERO must provide the taxpayer with the business rule(s) accompanied by an explanation. The taxpayer will have to file a paper return if he does not want the electronic portion of the return corrected and transmitted to the IRS or if it cannot be accepted for processing by the IRS. In such situations, a timely filed paper return will be considered one that is filed by the later of the due date of the return or ten calendar days after the date that the IRS gave notification that the electronic portion of the return was rejected or that it could not be accepted for processing. When the taxpayer submits the paper return, it should include an explanation of why the return is being filed after the due date.
*The Federal/State e-file option allows Federal and state income tax returns to be filed electronically in a single transmission to the IRS.