Rev. Proc. 74-45

Section 1. Purpose.

This Revenue Procedure states the requirements of the Internal Revenue Service regarding the acceptance of computer-prepared Form 1040 and substitutes for the related schedules.

Sec. 2. Specifications.

For filing purposes the Service will accept computer-prepared individual income tax returns, Form 1040, and substitutes for the related schedules provided the forms meet the guidelines prescribed in Sections 3, 4 and 5 below.

Sec. 3. General Instructions.

.01 A one-half inch margin must be maintained across the top, bottom and sides of all computer-prepared substitutes. See exception, Section 5.01.

.02 Use the preaddressed label on all computer-prepared substitutes that will be filed with the Internal Revenue Service Centers.

.03 Identify all computer-prepared substitutes clearly; print the Schedule designation one-half inch from the top margin and one and one-half inches from left margin; print the title centered on the first line of print; and print the taxable year on the same line one to one-half inch from right margin.

.04 State tax information must not appear on the Federal tax return which is filed with the Internal Revenue Service Center, except when the amount paid is claimed on Schedule A (Form 1040) as a deduction.

Sec. 4. Conditions.

.01 Form 1040.--The weight, size, margins, etc., of the computer-prepared form must meet the requirements specified in Revenue Procedure 74-44, page, this Bulletin, and the format, except for minor deviations, must follow the format of the official return. To make the form suitable for computer preparation, minor format modifications such as eliminating the vertical lines from the area reserved for social security number, changing the dimensions of the check boxes for filing status, etc., are permitted.

.02 Schedules A&B, C, D, E&R, F, G and SE.--Computer-prepared substitutes for these forms may be submitted on good quality, standard lined stock machine stationery provided:

(a) The format of each substitute schedule follows the format of the official schedule so far as item caption, line references, sequence, etc., are concerned. With the exception noted below, all lines and items required by each official schedule must be shown on the computer-prepared substitute.

EXCEPTION.--In the case of substitutes for Schedule A and/or E, detailed information for any deduction or income category may be omitted from the printout if the category total to be reported is zero. However, the substitute schedule must show the total (zero when applicable) for each category. With regard to Schedule A, lines 35-40 need not be shown on the printout; but, the total of itemized deductions must be shown on line 41.

(b) Lined stock paper must be used, the reference code for the items on a schedule may be printed to the left of the caption (see example below).

 EXAMPLE

Sec. 5. Additional Instructions.

.01 Form 1040.--Internal control numbers and identifying symbols of the computer preparer may be shown on the facsimile if the use of such numbers or symbols is acceptable to the taxpayer and/or his representative. If shown, such information must not be printed in the top 1/2 inch clear area from the center of Forms 1040 and/or Schedules, to the right edge.

.02 Schedules A&B, C, D, E&R, F, G and SE.--Descriptions for captions, lines, etc., required by the official schedules may be limited to one print line on the substitute by using abbreviations, contractions, and by omitting articles, prepositions, etc. However, sufficient key words must be retained to permit ready identification of the caption, line or item.

(a) Explanatory details for entries shown on a substitute schedule may be included on the substitute, or submitted in the form of a supporting statement at the option of the preparer. If a supporting statement is submitted, it must be referenced to the schedule entry which it supports. The entry on the substitute schedule, in turn, must be cross-referenced to the supporting statement. However, all total lines of all substitutes must have a total printed, carried forward from any supporting statements. Substitutes for Schedule A must have a money entry for each numbered item on the official form. See exception, Section 4.02(a) above.

(b) Text prescribed for the official form which is solely instructional in nature, e.g., "Attach this schedule to Form 1040," "See instructions," etc., may be omitted from the substitute schedule.

(c) Information for more than one schedule may not be shown on the same printout page. Any schedule may be continued on two or more pages if necessary.

Sec. 6. Other Information.

Preparers who desire to file substitute schedules developed according to these prescribed guidelines must obtain prior approval of the Service to do so. Proposed substitutes should be forwarded by letter to the Commissioner of Internal Revenue, Attention: ACTS:T:P, 1111 Constitution Avenue, N.W., Washington, D.C. 20224, no later than December 20 of the taxable year. An approval letter from the Internal Revenue Service must be received before the computer prepared substitute may be used.

Sec. 7. Effect on Other Documents.

This Revenue Procedure supersedes Revenue Procedure 73-22, 1973-2 C.B. 473.