Rev. Proc. 84-6

                              CONTENTS

SECTION 1. PURPOSE

.01 The purpose of this Revenue Procedure is to provide the requirements and conditions for submitting Form 8027, Employer's Annual Information Return of Tip Income and Allocated Tips, on magnetic tape instead of filing paper returns. Form 8027 information may be filed on magnetic tape and sent annually to the Service beginning in 1984. The due date for the first submission of Form 8027 on magnetic tape to the Internal Revenue Service is February 29, 1984.

SEC. 2. APPLICATION FOR MAGNETIC MEDIA REPORTING

.01 For the purposes of this Revenue Procedure, the employer is the organization supplying the information and the transmitter is the organization preparing the magnetic media file. The employer and transmitter may be the same organization. Employers or their transmitters are required to complete Form 4419, Application for Magnetic Media Reporting of Information Returns. Requests for copies of this form or for additional information on magnetic media reporting should be addressed to the attention of the Magnetic Media Coordinator of the Service Center listed in PART A, SEC. 7. of this Revenue Procedure.

.02 The Service will act on an application and notify the applicant of authorization to file, in writing, within 30 days of receipt of the application. Magnetic media returns may not be filed with the Service until the application has been approved.

.03 The Service will assist new filers with their initial magnetic media submission by encouraging the submission of test files for review in advance of the filing season. Approved employers or transmitters who wish to submit a test file should contact the Magnetic Media Coordinator of the Service Center listed in PART A, SEC. 7. of this Revenue Procedure.

.04 If there are hardware or software changes that would affect the characteristics of the magnetic media submission, the employer (or its transmitter) is required to submit a new Form 4419.

.05 Only employers or transmitters using equipment compatible with the Service's equipment will have their applications approved. Compatible tape characteristics are shown in PART B, SEC. 1.

SEC. 3. FILING OF MAGNETIC MEDIA REPORTS

.01 Packaging, shipping, and mailing instructions will be provided by the Service within 45 days of the granting of approval. A magnetic tape reporting package, which includes all necessary transmittals and labels, will be mailed to all approved filers.

.02 With the Service's concurrence, employers can submit a portion of their returns on magnetic media and the remainder on paper Forms 8027, provided there is NO DUPLICATE FILING. The magnetic media records and paper forms must be filed at the INTERNAL REVENUE SERVICE CENTER listed in Part A, SEC. 7. of this Revenue Procedure. A Form 8027-T, Transmittal of Employer's Annual Report of Allocated Tips, must accompany paper submissions and a Form 4804, Transmittal of Information Returns Reported on Magnetic Media, must accompany magnetic media submissions.

.03 The affidavit which appears on Forms 8027-T and 4804 should be signed by the employer. A transmitter, service bureau, or disbursing agent may, however, sign the affidavit on behalf of the employer if all of these conditions are met:

(a) It has the authority to sign the affidavit under an agency agreement (either oral, written, or implied) that is valid under the State law.

(b) It signs the affidavit and adds the caption "For: (name of employer)".

.04 Although a duly authorized agent signs the affidavit, the employer is held responsible for the accuracy of the Form 8027 and will be liable for penalties for failure to comply with filing requirements.

.05 If a portion of the returns are submitted on paper documents, include a statement on the Form 8027-T that the remaining returns are being filed on magnetic media. Please note that Form 8027-T normally applies to the filing of information returns on paper; however, filers of magnetic media must review the Form 8027-T and file Form 8027-T if appropriate.

.06 If an allocation of tips is based on a good faith agreement, a copy of the agreement must accompany the submission.

.07 If an allocation rate of less than 8% has been granted by the District Director, a copy of the determination letter must accompany the submission. Employers with more than one establishment can receive approval from one district in each IRS region where establishments are located (see section 31.6053-3(h)(4) of the Employment Tax Regulations).

SEC. 4. FILING DATES

.01 Magnetic tape reporting to the Service for Form 8027 must be on a calendar year basis. The first due date of either paper or tape Forms 8027 is February 29, 1984.

SEC. 5. PROCESSING OF MAGNETIC MEDIA RETURNS

.01 The Service will copy the information from the original tapes and return the original tapes to the employer. Normally tapes will be returned within three months after the annual due date for submission to the Service, or within three months after actual receipt of acceptable tapes, whichever is later.

.02 All files submitted must conform totally to this revenue procedure. IF FILES ARE UNPROCESSIBLE, THEY WILL BE RETURNED TO THE FILER FOR CORRECTION. Corrected files must be filed with the Service Center as soon as possible. If the delay will be more than two weeks, contact the Service Center Magnetic Media Coordinator for instructions. Corrected files will be returned by the Service within six months of receipt.

SEC. 6. EFFECT ON PAPER RETURNS

.01 If a portion of the returns is reported on magnetic media and the remainder is reported on paper forms, those returns not submitted on magnetic media must be filed on Form 8027.

SEC. 7. MAGNETIC MEDIA COORDINATOR CONTACT

Requests for additional copies of this revenue procedure or for additional information on magnetic media reporting of Forms 8027 should be addressed to the attention of the Magnetic Media Coordinator of:

         Internal Revenue Service

 Element              Description

SECTION 1. GENERAL

.01 The magnetic tape specifications contained in this part of the procedure define the required format and contents of the records to be included in the file. These specifications must be adhered to unless deviations have been specifically granted by the Service in writing.

.02 In most instances, the Service will be able to process any compatible tape files. Compatible tape files must meet any one set of the following:

(a) 7 channel BCD (binary coded decimal) with

(1) Either Even or Odd Parity and

(2) A density of 800 BPI.

(b) 9 channel EBCDIC (Extended Binary Coded Decimal Interchange Code) with

(1) Odd Parity and

(2) A density of 800, 1600, or 6250 BPI.

(c) 9 channel ASCII (American Standard Coded Information Interchange) with

(1) Odd Parity and

(2) A density of 800, 1600, or 6250 BPI.

.03 All compatible tape files must have the following characteristics:

(a) Type of tape--0.5 inch (12.7 mm) wide, computer grade magnetic tape on reels of up to 2400 feet (731.52 m) within the following specifications:

(1) Tape thickness: 1.0 or 1.5 mils

(2) Reel diameter: 10.5 inch (26.67 cm), 8.5 inch (21.59 cm), or 7 inch (17.78 cm)

(b) Interrecord Gap--3/4 inch.

SEC. 2. RECORD LENGTH

.01 The tape record defined in this procedure may be blocked or unblocked, subject to the following:

(a) A FIXED RECORD OF 464 POSITIONS IS REQUIRED.

(b) All records except the Header and Trailer Labels may be blocked.

(c) A block must not exceed 2320 tape positions.

(d) If the use of blocked records would result in a short block, all remaining positions of the block must be filled with 9's. Do not pad a block with blanks.

SEC. 3. OPTIONS FOR FILING

For the purposes of this procedure the following conventions must be used.

Header Label:

1. Employers may use standard headers provided they begin with 1HDR, HDR1, VOL1, or VOL2.

2. Consist of a maximum of 80 positions.

3. Header and Trailer Labels are optional unless more than one reel is being submitted. If more than one reel is being submitted Header and Trailer Labels are REQUIRED.

Trailer Label:

1. Standard trailer labels may be used provided that they begin with 1EOR, 1EOF, EOR1, or EOF1.

2. Consist of a maximum of 80 positions.

3. Header and Trailer Labels are optional unless more than one reel is being submitted. If more than one reel is being submitted Header and Trailer Labels are REQUIRED.

Record Mark:

1. Special character used to separate blocked records on tape.

2. Can be written only at the end of a record or block.

3. For odd parity tapes, use BCD bit configuration 011010 ("A82").

Tape Mark:

1. Used to signify the physical end of the recording on tape.

2. For even parity, use BCD configuration 001111 ("8421").

3. May follow the header label and precede and/or follow the trailer label.

                RECORD NAME: 8027 MAGNETIC TAPE RECORD