The Thousand Hands of the IRS

[joshuabarksatlcs]

C Corp client e-filed FYE 6/30/2020 T/R in March 2021.  Refunds were requested for US and IL.  I have the efile confirmation numbers from Lacerte.  No refund has been received so far from either.

Corp just received Notice CP259, stating the Corp hadn't filed F1120 for FYE 6/30/2020.  

I know the IRS is behind.  I wonder if this was a case of the return-processing hand of the IRS being behind and the delinquent-return-catching hand is following up on the Form 1120s (while the other 998 IRS hands are pursuing penalties and collections).

CP259 asked TP to MAIL IN a copy of the return.  Well, we know the TP-correspondence-processing hand is still slowly working.  (What - 2 million pieces of unread correspondence as of December, right?)

So, what is client to do?  Anyone out there has experience or ideas?  (....  @IRonMaN skip your ideas.  Just tell another Paddy joke....)

[rbynaker]

Maybe call the efile help desk and see if they can trace your submission ID?  That's the start of the trail of breadcrumbs.  I don't have the number handy but maybe someone else can chime in.  I bet @George4Tacks has it.

[BobKamman]

Does the FY on the CP259 match that on the return as filed?  Are you sure of that?

According to IRS, you can e-file again:

What you need to do

• File your required business return immediately.
• If eligible, file your return electronically with all required schedules, using your e-file provider, or
• File a paper return with all required schedules.
• If you think you’re not required to file, complete the Response form enclosed with your notice and mail it to us, using the enclosed envelope or fax it to 855-800-5944. Use the Response form on your notice to explain why you don’t think you need to file.
• If you have filed within the last four weeks using the same name and EIN shown on the notice, you may disregard this notice.

https://www.irs.gov/individuals/understanding-your-cp259-notice 

[qbteachmt]

This was part of a recent e-newsletter by email:

https://www.irs.gov/newsroom/irs-statement-providing-meaningful-assistance-to-taxpayers-in-the-curre...

"As part of this ongoing effort and balancing the importance of protecting the interests of tax administration, the IRS has also been taking important steps to modify our operations and provide additional taxpayer relief. These efforts include suspending issuance of certain automated notices and related actions. We are looking at the suggestions that have come in, and we will continue modify and adjust our efforts going forward to help taxpayers and the tax community.

For example, we have already decided to suspend notices in situations where we have credited taxpayers for payments but have no record of the tax return being filed. In many situations, the tax return may be part of our current paper tax inventory and simply hasn't been processed. Stopping these letters — which could have otherwise been sent to thousands of taxpayers — will help avoid confusion.

It is important to appreciate that many IRS notices are statutorily required to be issued within a certain timeframe to be legally valid. This means they must be sent, absent congressional action. We will continue to explore areas where the IRS can make changes and are in the process of reviewing the full set of notices that we send to determine where we can make adjustments while we continue to work through unprocessed returns and taxpayer correspondence."

In other words, it would take an act of Congress...

[joshuabarksatlcs]

RE: Does the FY on the CP259 match that on the return as filed?  Are you sure of that?

Yes.  Yes.

https://www.irs.gov/individuals/understanding-your-cp259-notice 

The link seemed to be for individuals.  I will look into whether it's applicable to a corporation.

[IRonMaN]

Ok, if that is all you want:

Paddy and Mick are two Irishmen working at the local sawmill.
One day, Mick slips and his arm gets caught and severed by the big bench saw.
Paddy quickly puts the limb in a plastic bag and rushes it and Mick to the local hospital.
Next day, Paddy goes to the hospital and asks after Mick.
The nurse says, 'Oh he's out in Rehab exercising'.
Paddy couldn't believe it, but here's Mick out the back exercising his now re-attached arm.
The very next day he's back at work in the saw mill.
A couple of days go by, and then Mick slips and severs his leg on another bloody big saw thingamabob.
So Paddy puts the limb in a plastic bag and rushes it and Mick off to hospital.
Next day he calls in to see him and asks the nurse how he is.
The nurse replies, 'He's out in the Rehab again exercising'.
And sure enough, here's Mick out there doing some serious work on the treadmill.

And very soon Mick comes back to work.
But, as usual, within a couple of days he has another accident and severs his head.
Wearily Paddy puts the head in a plastic bag and transports it and Mick to hospital.
Next day he goes in and asks the nurse how Mick is.
The nurse breaks down and cries and says, 'He's dead.'
Paddy is shocked, but not surprised. 'I suppose the saw finally did him in.'
'No', says the nurse, 'Some dopey b*stard put his head in a plastic bag and he suffocated'

[joshuabarksatlcs]

Paddy is shocked, but not surprised...

@IRonMaN  I tried to, but couldn't find the Super Kudos button.  Now that you've got Paddy out of the way, give me your ideas.

[IRonMaN]

I would go the rbynaker route.

[joshuabarksatlcs]

A good thought, except that, boo hoo, @George4Tacks ain't talking to us and I will have to do my own research....

[BobKamman]

@joshuabarksatlcs "The link seemed to be for individuals.  I will look into whether it's applicable to a corporation."

It also involves a problem that has only been connected to paper-filed returns.  I still think you have a fiscal-year problem -- but maybe on the IRS end, not yours.  

[joshuabarksatlcs]

The notice specified the correct Year-end.  My speculation is that due to the unusual amount of refund ($16K+) and loss (first loss in years mainly due to COVID), the refund processing was put aside by the handler and somehow the efiling was not registered on the IRS end.  I don't know whether this would cause the IL return NOT to be "forwarded" because the IL refund has not been received either. 

My impression is that even with efiling, tax returns still have to be processed by humans.  No?  

[BobKamman]

I think some of them are kicked out for further review, but the account transcript should still show a return was filed.  But corporations may be like the 1040-X -- what you are really filing is like a pdf that shows up on someone's screen and has to be routed to one of several offices.  

[George4Tacks · Accepted solution]

I really was not trying to ignore @joshuabarksatlcs but I had a second doctors office visit today. I went a couple of weeks ago to disclose a problem I had. I confessed that I was having excess gas and it was leaking out on a very regular basis. I explained that it really wasn't a great concern, since there really was no noise and no smell. The doctor checked me all over and gave me a prescription and told me to come back in two weeks. This was my 2 week check up and I told him that whatever was in those pills only made things worse. Now my farts smell something horrible. The doctor said "Great! now that we have your sinuses cleared up, we can get your hearing checked."

Yes, possibly the help desk can confirm receipt with the submission ID https://www.irs.gov/e-file-providers/e-help-desk-for-tax-professionals

[IRonMaN]

Thanks for finally getting that checked out George.  It was getting a little difficult to spend much time here due to the odor.  But the good news was, we always knew when you were around.

[joshuabarksatlcs]

Yes, possibly the help desk can confirm receipt with the submission ID https://www.irs.gov/e-file-providers/e-help-desk-for-tax-professionals

Thanks @George4Tacks .  The number worked.  I called three times, and each time I was told the estimated wait time would be 15 to 30 minutes.  For the first two times, I waited hours until like 5 pm and got transferred to a message that says the office hour was over. 

The wait time for the third call was actually 17 minutes.  In case anyone calls, the first info I had to provide was my EFIN number, then my firm info.  After all that it was the client's info and the date it was accepted.  In my client's case, the efile was accepted.  I was directed to call another number to find out the processing status.

Anyway, George, check out the expanded services under Option (6) and (7) below, the IRS may be able to help you, too.

Phone Options has changed. Please listen to all the menu options before selection. Use the following bulleted options as reference.

From the Main Menu

• Press (1) for e-File, ERO, ITIN related information
• Prese (2) for e-Services related information

From the (e-File, ERO, ITIN) Sub-Menu

• Press (1) for Individual Returns
• Press (2) for Business and Non-profit returns
• Press (3) for e-File Application
• Press (4) for Suitability
• Press (5) for Acceptance Agent Application
• Press (6) for hearing problems 
• Press (7) for problems with excess gas

[rbynaker]

Ugh.  Keep us posted on your trail of breadcrumbs.  Hurdle #1 - done.  IRS agrees it was submitted.  Now to find out what happened to it . . .