2019 Amended/Efiled Returns

[abctax55]

"Because the IRS continues to work through backlogs, the normal processing time of up to 16 weeks for F1040X submitted on paper also applies to the electronic Forms 1040-X."

From an IRS Alert this afternoon...   veddy, veddy interesting.  So it'll be the same hurry up & wait scenario.

[BobKamman]

At no time ever did IRS tell anyone that this was being done for the convenience of taxpayers and practitioners.  It's done so that examiners can look at a computer screen, based on your data entry, rather than at a piece of paper.  Whatever made you think otherwise?

It's like electronic filing -- pay a clerk $10 to work at a computer terminal so IRS saves $2.50. 

[abctax55]

Deleted

[Just-Lisa-Now-]

"Whatever made you think otherwise?"

Uhmm, Efiling makes things go quicker....what would have made anyone think it would take just as long as paper?

[BobKamman]

E-filed original returns, like paper returns, are never examined before acceptance.  There are some computer filters that slow down processing for both types of returns.  E-filing simply removes the mailing and mail-opening delay (in normal times, 3 to 5 days) and the IRS data entry delay (in normal times, 2 or 3 days).  

Amended returns have always been examined by a real person, if only to determine that they meet some criteria to bypass further examination by someone with more training.  That is going to continue because IRS thinks it prevents fraud and unintentional errors.  The publicity for e-filed amended returns always points out that you can check the status of your return using the IRS tool, a week or so after it is transmitted.  They're still being processed in the order received -- it's just that those received in digital form, get in line faster.  They won't be put at the front of the line, because there are too many that won't be accepted electronically, and there are too many paper returns that are accruing interest in higher amounts or for which the statute is about to expire.  

[BobKamman]

Here are just a few excerpts from the Internal Revenue Manual that describe processing of amended returns.  A practitioner has no way of knowing whether the original return meets certain criteria, like:  Are the adjustments greater than the amounts allowed without examination?  Has the return already been identified as one with Exam potential?  Has a CP-2000 issue already been identified?  Is there evidence of identity theft?  

3.11.6.4.9.1 (09-24-2019)

Category A (CAT-A) Criteria

1. To determine whether a return meets Category A (CAT-A) criteria, see Examination Criteria (CAT-A) - General and Examination Criteria (CAT-A) - Credits.

   Note: 

   Unless otherwise specified, the dollar amounts cited refer to the amount of the tax decrease or credit increase whether or not the claim results in a refund or a decrease to the balance due.

2. Do not apply CAT-A criteria to:

   • Combat Zone returns when the TP is actively serving in a Combat Zone. See IRM 3.11.6.4.22

   • CP notices

   • Credits that are being disallowed

   • Credits that are being reduced below the CAT-A tolerance due to Masterfile or Math verification

3. For CC DDBCK CAT-A criteria, see IRM 3.11.6.8.1.

4. When EIC is increasing and Schedule C meets CAT-A criteria input CC DDBCK prior to referring the case to CAT-A. If the CC DDBCK validation results screen shows the case as "Selected," refer the case to Exam using the "Selected" cover sheet. Otherwise refer the case as CAT-A for the Schedule C.

5. If the case is being forwarded to CAT-A, do not input a TC 971 AC 013.

6. Once identified, these cases will be placed in a special sort identified as CAT-A and the issue will be identified by checking a box as to its category on a summary sheet. These will be expedited, per local procedure, to CIS/AM for disposition to Exam.

3.11.6.4.9.2 (03-28-2019)

Exam/-L Freeze Claim Processing

1. Accounts with a -L freeze indicate an account has been selected for a potential audit. Since not all cases with a -L freeze will be audited, processing procedures differ based on the Audit Information Management System (AIMS) status.

2. If an -L freeze is present, use CC AMDISA to determine the AIMS status. The AIMS status will determine the current status of the potential audit.

   Note: 

   If there is an open IDRS control base to CI-SDC, continue to follow processing procedures outlined in IRM 3.11.6.4.8.

3. For accounts with a -L freeze and the AIMS status is 08 or less:

   • If the claim meets CAT-A criteria, per IRM 3.11.6.4.9.1 route the case to CAT-A per local procedures.

   • If the claim does not meet CAT-A criteria, process the claim following normal processing procedures. Do not forward the case to Exam.

4. For accounts with a -L freeze and the AIMS status is greater than 08:

   • Route to Exam based on the Employee Group Code (EGC) identified on AIMS. See link to the EGC located on SERP under Who/Where Exam Employee Group Code http://mysbse.web.irs.gov/examination/mis/contacts/default.aspx.

   • Follow local procedures for routing. See IRM 3.11.6.4.9.

   Exception: 

   If the AIMS status is 90 indicating a closed audit or there is a pending TC 300 - 361, refer the case to CIS/AM.

   Exception: 

   Whether identified through an open control base or CC AMDISA, amended returns should not be routed to Appeals, IDRS number 66XXX, route to CIS/AM.

   • Input a TC 971 AC 013 and use the received date of the amended return for the transaction date

     Exception: 

     On CC DDBCK "Selected" cases, IDRS will automatically input the TC 971 AC 013 when a TC 971 AC 010 is not present.