Supplemental Nutrition Assistance Program (SNAP) How does it work? You can apply for the offset hardship refund, in which the money withheld from your tax refund will be returned.You can also contact your loan servicer to try and set up a repayment. Monitor the account per IRM 21.4.4.6.1, Monitoring Manual Refunds until the module balance is zero to avoid erroneous refunds and credit balances. Any remaining RRC should then be split equally between the spouses on the joint return. Insolvency will determine if the tax offset is in violation of the automatic stay. See IRM 21.4.6.5.23, TOP Unpostable Conditions. When a taxpayer wants to claim innocent spouse relief, but mistakenly uses Form 8379, Injured Spouse Allocation, return the Form 8379 to the taxpayer. Prepare MRR for dishonored amount and submit to NHQ. 4) Taxpayer claims his/her refund was less than expected, amount disagrees with TC 846/840. If the Form 8379 is filed by itself, and there was no offset on the tax period being worked or a corrected math error has created a balance due. Use a secondary transaction code on the credit side of CC ADD24 or CC ADD34 (e.g. Indicate taxpayer's phone number and whether taxpayer can provide a copy of Form 8379. Before reversing any offset to Office of Child Support Enforcement (Agency Codes 1 and/or 2), see IRM 21.4.6.4.2.4, Child Support TOP Offsets. To determine whether the 45-day interest-free period has been met, consider these three dates: Return due date (determined without regard to any extension of time for filing the return). If the Form 8379 is not attached to the joint Form 1040 or Form 1040X, but is instead filed separately (after offset), and is received after the time allowed, See IRM 21.4.6.5.8.10, Time Period for Submitting Form 8379. This includes refunds resulting from disaster claims or levy proceeds. Bureau of the Fiscal Service will reduce the offset against the oldest certified debt first. Inform the injured spouse that his or her refund can be offset for any past-due child support or other TOP debts that he or she may owe. Do not change the address on CC ENMOD. For each TC 766 rejection, Bureau of the Fiscal Service provides a reason for the reject and is displayed on the report as a "result code" . Consequently, the refund will offset, resulting in having to reverse the offset to process the Form 8379, Injured Spouse Allocation. Monitor the account until all account adjustments have posted and the account is in zero balance. The additional interest owed the injured spouse on the TC 766 amount of $4,220.99 is therefore computed FROM August 13, 2020. Refer to IRM 21.4.4.5, Preparation of Manual Refund Form. Transfer any misapplied payments to the correct period. See paragraph (4) below for emergency refunds or see IRM 21.4.6.5.11.1, Offset Bypass Refunds (OBR), before any action is taken. The 5-month limit allows for internal system processing of the offset reversal request (TC 766 with an Offset Trace Number - OTN). As of March 18, 2021, the 2020 RRC amount will no longer be applied to past due federal income tax debts. If a taxpayer calls and wants to update their address after filing Form 8379, refer to IRM 3.13.5.49, Updating Address Records for instructions. TC 150 is not blocked 92 and a paper return was filed. Refer to IRM 21.5.2.4.23, Reprocessing Returns/Documents. Rule. For 2018 and subsequent; If the Exemption portion is blank or shows zero or the total credits are not allocated, the form is not considered Incomplete. A tax offset will not occur in certain situations, see IRM 21.4.6.5.10.5 Injured Spouse Refund - Tax Offset. See IRM 21.4.6.5.12.2, Manual Reversal of TOP Offset, for additional instructions. Some of these codes may also occur when you attempt to post other transactions not explained in this section. If the taxpayer responds after the time frame provided in the letter (30 days), we will honor their request if the funds have not yet been applied back to the IMF accounts. This is needed on Form 5792, Request for IDRS Generated Refund (IGR), and Form 3753, Manual Refund Posting Voucher. If the taxpayer claimed the TETR refund on their original return but did not allocate the credit on Form 8379 allocate the TETR refund 50/50, one-half for each spouse, split any interest 50/50. In general, a TC 899, type 1, 2, 3 or 4 will be pending or posted to the account. How much money has TOP recovered? The six-month limitation period, noted in (4) above, does not apply to the processing of Form 8379, Injured Spouse Allocation. When issuing a manual refund, use the applicable BPI to assign ownership of the refund to the injured spouse. An agency refund (TC 899 or TC 971 AC 599) was issued for the entire amount of the offset. TC 766(s) that are rejected in whole or in part by Bureau of the Fiscal Service are output on a weekly Bureau of the Fiscal Service TC 766 Reject Listing and provided to the TOP Liaison Office for resolution. This tolerance applies to both IMF and BMF. Refer Taxpayer to TOP Call Center above for offset information. Request via telephone or letter that the taxpayer send a signed copy of the form via fax or mail and provide any other missing information. Individual Income Tax Return, was not timely per IRC 6511 (a), or IRS determines there is no overpayment available for credit or refund per IRC 6511 (b), then there would be no joint credit or refund to offset or reallocate pursuant to Form 8379. Arizona, Idaho, Nevada, and Wisconsin recognized same-sex marriages starting in late 2014. Close the case. Individual Income Tax Return, was received. Taxpayers may file an Injured Spouse Allocation by attaching a Form 8379, Injured Spouse Allocation, to their tax return and noting Injured Spouse in the upper left corner of the Form 1040 series. Individual Income Tax Return or Form 1040-X , Amended U.S. If the secondary spouse owes the debt, the debtor TIN will also be shown DEBTOR-TIN. Research CC IMFOLE for the Combat indicator on Line 11. You may see a TC 971 AC 598 posted for audit trail purposes only. If a Form 8379, Injured Spouse Allocation, is unsigned and was not filed with the original signed return or attached to a signed Form 1040-X, Amended U.S. The husband does not file an income tax return for 2012 that claims an overpayment. A CP 45, Reduced Credit Elect is issued to inform the taxpayer of the reduction in the amount of his/her credit elect and the possible need to make additional estimated tax payments. Subtract from the TC 898 all TC 766(s) with the same OTN. Research CIS for an explanation of the no consideration and explain the reason for the no consideration to the taxpayer. If AM accepts the resubmitted allocation it is unnecessary to forward the case to Appeals. (-R with an Unreversed TC 971 and/or TC 972 AC 134) IVO Involvement: Process the injured spouse allocation without regard to IVO indicators when the income data is verifiable on CC IRPTRL. A BPI is needed on these refunds, but is limited to BPI 0 and 3. No other payments or credits are made to the 2011 MFJ account. TC 898 ($1,500.00) TC 899 types 2 ($45.00) +TC 899 type 4 ($45.00), TC 899 type 1 ($1,500.00)= 0, TC 898 or TC 971 AC 598 TC 899 or TC 971 AC 599 types 1, 2, or 3 TC 766s + TC 899 or TC 971 AC 599 type 4 + TC 767s = Net TOP Offset Amount, Processing Form 8379, Injured Spouse Allocation, for Agency Code 1 or 2, The posted offset(s) is more than 5 months old for Agency Code 2, The posted offset(s) is 5 months old or less for Agency Code 2, The posted offset is more than 5 months old for Agency Code 1, The posted offset is 5 months old or less for Agency Code 1. 2) Taxpayer inquires about his/her portion of refund prior to filing original return, 3) Taxpayer inquiries about his/her portion of refund after filing original return. The amount of credit elect, up to the amount of the debt owed, is released for refund and includes any applicable interest. (Example: NCP SC1 RRC 50/50). Use HC 2 for Injured Spouse cases. Command Code (CC) TXMOD also contains the debt liability indicator, found directly below the Transaction Code (TC) 846 and is displayed in the form of the number "0" or "1" . Additional information is found in IRM 1.1.13.7.3 Accounts Management and IRM 21.1.1, Accounts Management and Compliance Services Overview. When Insolvency approves the manual refund, you must indicate approval on Form 5792. When the injured spouse is entitled to all or part of the joint refund and the injured spouse's allocated share of the overpayment is reduced in whole or part by their own, TOP debt, Federal tax offset, credit elect, or any prior refund, then send Letter 3179C, Refund Offset to Treasury Offset Program (TOP) and Injured Spouse Inquiries, or Letter 285C, Refund/Overpayment Applied to Account, giving the injured spouse: The amount of any refund that will be issued which may be subject to offset to TOP debts he/she owes. See IRM 21.4.6.4.2.4, Child Support Top Offsets. If Insolvency does not provide a specific name and number for the injured spouse to contact include the Philadelphia CIO telephone number 800-973-0424 in the Letter 3179C. If a Letter 105C, Claim Disallowed was previously sent because the return was not timely filed, advise the taxpayer that we cannot consider Form 8379, Injured Spouse Allocation. See IRM 21.4.6.5.10.6, Issuing the Injured Spouse Refund. TC 898(s) will display the DEBTOR-TIN for offsets to the secondary taxpayer's debt and offsets to the primary taxpayer's debt will not display the DEBTOR-TIN. Wage & Investment Division. Use HC 4 for TOP offset reversals that will result in a credit balance on the tax module. TOP can only give you the contact information for the federal or state agency attempting to collect the debt. A TC 899 Type 1 may not appear on the account. Agency correspondence "certifying" a debtor, or requesting that a debtor's tax refund be offset, is returned to the agency. Work the case. 31 CFR 285.3 (h). If there is no tax and the taxpayer did not allocate the payments, the form is incomplete. Once Insolvency determines the offset is in violation of the automatic stay, Insolvency will contact the TOP Liaison for a copy of the Insolvency Special Procedures Referral Form. Only the agency owed the debt can honor a hardship request to prevent a TOP offset or make a refund of the offset due to hardship circumstances. The injured spouse's portion of tax exceeds their refundable credits. Reverse the TOP offset first using the appropriate hold code and then transfer any additional amount allocated to the Injured Spouse from the tax offset. If the freeze ends on May 1, 2022, the IRS will be able to apply tax refunds to student loans, child support, and other delinquent debts owed to state and federal agencies. Explain that IRS has already obtained the offset funds from the agency and that the agency is now owed the money. 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