21.4.4. Manual Refunds

(1) Purpose: This IRM covers general information on preparing manual refunds. Any specific program instructions for issuing a manual refund are found in the issue specific IRM.

(2) Audience: The primary users of this IRM are all IRS employees in any Business Operating Divisions (BODs) who prepare and input manual refunds.

(3) Policy Owner: The Director of Accounts Management.

(4) Program Owner: Process and Program Management, Accounts Management, Wage and Investment (WI).

(5) Primary Stakeholders: The primary stakeholders are organizations that collaborate with Accounts Management (e.g., Return Integrity Verification Operations (RIVO) and Submission Processing).

(6) Program Goals: To provide manual refund customers (all BOD’s and taxpayers) with high quality procedures to prepare and input manual refunds.

(1) A manual refund, transaction code (TC) 840, is a refund that is not generated through normal Master File processing (TC 846). Manual refunds are requested on either Form 3753, Manual Refund Posting Voucher, or Form 5792, Request for IDRS Generated Refund.

(2) Employees from all functions can initiate requests for manual refunds. The Form 3753 or Form 5792 manual refund requests are prepared by the initiator and are processed by the Accounting Function of the Submission Processing Campus who schedules and certifies manual refunds.

(3) This IRM provides information on the types of manual refunds and the actions needed to initiate a manual refund. Other IRM sections and subsections will give specific situations when a manual refund is required.

(1) The most frequent causes of manual refunds are:

1. The refund will be going to someone other than the entity name on the Master File.

2. A hardship situation that requires a quicker refund than normal systemic processing can provide, generally a request is sent by the Taxpayer Advocate Service (TAS) using an Operations Assistance Request (OAR).

3. The refund is not for a Master File account (e.g., Photocopy Fees or Credit Card Chargebacks), or

4. Systemic limitations prevent a normal computer-generated refund.

(2) Input of manual refunds without consideration of systemic account issues or Customer Account Data Engine (CADE) 2 processing (on Individual Master File (IMF) accounts) can result in erroneous refunds. In addition, improper IDRS controls and lack of required monitoring can result in erroneous refunds.

(3) The following are some circumstances that could warrant the issuance of a manual refund. This list is not all-inclusive:

1. Hardship - Those refunds required based on a hardship where the taxpayer needs the refund in less than ten days.
   When it is necessary to expedite a refund, employees can use Form 5792 to provide the customer a refund within 7 to 10 days. TAS employees can initiate a hardship direct deposit, once all documentation has been received, by using Form 3753, to provide a refund to the customer within 2 to 3 business days. See IRM 3.17.79.6.4.2, Certifying Automated Clearing House (ACH)/Direct Deposit Hardship Refunds, for manual refund procedures to issue an Automated Clearing House (ACH)/direct deposit hardship manual refund.

   Caution: Prior to issuing a manual refund on a taxpayer's hardship request, determine if the original return refund request is a direct deposit, Refund Anticipation Loan (RAL), or Refund Anticipated Check (RAC). Releasing an account refund hold to generate a refund to these accounts could result in a quicker refund to the taxpayer than issuing a paper (Form 5792) manual refund.

   The completed Forms 3753 and/or Forms 5792 are processed by the Submission Processing Accounting Function. The manual refund is issued within a few business days of IDRS input. However, when issuing a refund utilizing Form 3753, it takes 4 - 6 weeks for the TC 840 to post to Master File. When completing the manual refund request, TAS must use the specific IRM reference as to why the manual refund is being issued for hardship.

   Note: Taxpayers requesting manual refunds for hardship reasons will be referred to TAS for hardship determination unless the refund can be initiated within 24 hours. Areas referring these cases to TAS should ensure they have thoroughly documented the Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), when an apparent hardship exists. Advise the taxpayer they will be contacted by TAS to validate the hardship per the timeframes in IRM 21.1.3.18, Taxpayer Advocate Service (TAS) Guidelines. See IRM 13.1.7.5, Same Day Resolution by Operations, for situations that meet the “Same Day” definition. Do not refer same day cases to TAS unless the taxpayer asks to be transferred and the case meets TAS criteria. Refer to the TAS Criteria Tool at https://irsgov.sharepoint.com/sites/CABIC/SitePages/critTool/TAS%20Criteria%20Tool.aspx for help in determining whether a taxpayer can be referred to TAS.

   Note: When TAS has made a hardship determination on an account with an open control in another area, they will send an OAR to that area requesting the refund be issued or that TAS be given written approval (via the OAR or e-mail) to input the manual refund. If the area is to release the refund, the refund should be released unless the OAR indicates a manual refund must be issued. Refer to IRM 3.17.79.3.3, Issuing Hardship Refunds, to determine back-up documentation requirements.

2. Dual Status Returns - See IRM 3.17.79.3.12, Non-Resident Alien and Dual Status Refunds (Austin Only District Office or DO 97 and 98).

3. Civil Cases

4. Form 4466, Corporation Application for Quick Refund of Overpayment of Estimated Taxes. See IRM 3.17.79.3.11, Form 4466, Corporation Application for a Quick Refund of Overpayment of Estimated Tax.

5. Form 8302, Electronic Deposit of Tax Refund of $1 Million or More. See IRM 3.17.79.3.10.1, Form 8302, Electronic Deposit of Tax of $1 Million or More.

6. Form 8050, Direct Deposit of Corporate Tax Refund - See IRM 3.12.217-9, Form 8050 - Direct Deposit of Corporate Tax Refund.

7. Large dollar refunds - Any refund of $100 million or more, must be issued as a manual refund on a Form 3753. Systemic refunds can be generated on IDRS (TC 846) for under these amounts, unless a manual refund is required for another reason.

8. Non-Master File Refunds

9. Congressional Inquiries

10. Interest Bearing Excise Fuel Claims - See IRM 4.24.22.4.5.3, Form 8849, Schedule 2, Sales by Registered Ultimate Vendors, IRM 4.24.22.4.5.4, Form 8849, Schedule 3, Certain Fuel Mixtures and the Alternative Fuel Credit, and IRM 4.24.22.4.5.7, Form 8849, Schedule 8, Registered Credit Card Issuers.

11. Offers in Compromise - See IRM 5.19.7.7.6, Disposition of OIC Deposits.

12. State Income Tax Levy Program - See IRM 5.19.9.3, State Income Tax Levy Program (SITLP) General.

13. Return of levied property to taxpayer - See IRM 5.19.4.4.12, Wrongful Levies, or IRM 5.11.2.3.2.2, Certain Wrongful Levy Situations.

14. Statute Imminent cases

15. Injured Spouse Claims - See IRM 21.4.6, Refund Offset.

16. Tentative Carryback Cases - See IRM 21.5.9.5.8, Carryback Manual Refund.

17. Deceased taxpayers - See IRM 21.6.6.2.21.2, Processing Decedent Account Refunds.

18. Reimbursement of return photocopy fees - See IRM 21.4.4.7.1, Photocopy Fee Refunds.

19. Chargeback for unauthorized credit card payments - See IRM 21.4.4.7.2, Credit Card Chargebacks.

20. Taxpayers in bankruptcy

    Note: All taxpayer refund inquiries regarding bankruptcy will be referred to the Centralized Insolvency Operation (CIO) in Philadelphia at 800-973-0424. Do not refer taxpayers to CIO if the only issue is the status of the refund and IDRS shows a refund is scheduled to be sent or was recently sent.

21. Non-receipt of direct deposit refunds due to IRS error - See IRM 21.4.1.5.7.5, Non-Receipt of Direct Deposited Refunds - "Refund Inquiry Employees."

22. To release an X- freeze - See IRM 21.5.6.4.47, X- Freeze.

23. Refund consists of Chapter Three Withholding (CTW) and non-CTW.

24. Refunds issued after the RSED has expired (prevention of RSED-STAT Transcript generating to the Statute Team) - See IRM 21.5.3.4.3, Tax Decrease and Statute Consideration, and IRM 25.6.1.10.3.3.2, Limitations on the Amount of a Claim.

(1) Thorough IDRS research must be completed before submitting a manual refund request to the Accounting Function. IDRS research is not required if the refund is being prepared for the Bureau of Fiscal Service.

(2) This subsection details the research needed for all other manual refunds.

(3) Failure to perform the necessary IDRS research, or to provide the back-up documentation when the manual refund is submitted to the Accounting Function, will result in the manual refund request being rejected back to the initiator.

(1) Manual refund is exception processing and has a greater margin for error. When possible, allow the system to generate the TC 846 refund. Releasing a hold on the account could result in a quicker refund to the taxpayer than issuing a manual refund. Do not issue a manual refund if:

• A generated refund will be released within two (2) cycles, except under conditions outlined in IRM 21.4.4.3, Why Would a Manual Refund Be Needed?

• There is a TC 971 AC 664 on the account, either AP, PN or posted. This transaction code indicates that either a direct deposit or paper manual refund has been issued

• The taxpayer indicated a direct deposit refund

(2) If a TERUP is input on a manual refund, the reinput of the manual refund must be done after the DQ shows.

(3) All offices requesting manual refunds must have Form 14031, Manual Refund Signature Authorization, authorized digital signatures on file with the Accounting Branch where the manual refund is submitted for processing, per IRM 3.17.79.3.5, Employees Authorized to Sign Requests for Refunds.

(4) Form 3753 and Form 5792 are posting documents used by Accounting to schedule and certify refunds. Accounting will reject any request that:

1. Is not legible, or contains a strike through, or contains white out.

2. Is prepared on an obsolete form.

3. Does not have back-up documentation attached.

4. Has a missing, incorrect, or incomplete authorized digital approved signature (The “SEID” digital signature format is required on Form 3753 and Form 5792.)

   Note: See IRM 3.17.79.3.2.3, Manual Refund Digital Signature Requirement, for digital signature requirements on Form 3753 and Form 5792. This IRM was updated with the acceptable format of the signature. The correct format is SEID followed by the name of the signer. See referenced IRM for example.

Note: See IRM 3.17.79.4.1, Case Review and Command Code REFAP (Refund Approval), and IRM 3.17.79.6.4.2 (10), Certifying Automated Clearing House (ACH)/Direct Deposit Hardship Refunds, for additional reject reasons.

5. Is missing required RSED statute notations for credit availability. See IRM 21.4.4.5.1 (3) Block 20 and IRM 21.4.4.5.2 (8) Section IV - Other Remarks.

6. Is not received in Accounting by the designated cut-off time.

(5) When an adjustment is input and a manual refund is being issued, a hold code (HC) 1, 2, or 4 must be input with the adjustment. If HCs are not input by the initiator, the Accounting Function will reject the request back to the initiator. Do not use HC 0 or 3 when inputting a credit adjustment and issuing a manual refund. HC 0 and 3 will not hold the credit and will allow a systemic refund or offset to generate.

(6) If a credit transfer to satisfy an outstanding balance (OBL) is also required, in addition to the instructions in (3) above, a TC 570 must be input on the debit side of the credit transfer (the side the money is being moved from, and from which the manual refund is being issued). If a TC 570 is not input with the credit transfer to establish a -R freeze, the credit transfer will release the -K freeze (established by using HC 1, 2 or 4 on the adjustment) and a systemic refund (TC 846) will be generated.

(7) Processing Form 5792, Request for IDRS Generated Refund (IGR), requires the following actions:

1. Prepare the manual refund document using the Integrated Automation Technology (IAT) Manual Refund Tool. Refer to IRM 21.4.4.5.1, Preparation of Form 5792, IDRS Generated Refund. Use of the IAT Manual Refund Tool is mandatory per IRM 21.2.2-2, Accounts Management Mandated IAT Tools.

2. If a duplicate condition is found, the IAT Manual Refund Tool will not complete the form. You must resolve the duplicate condition before the tool will allow the completion of the form. Be sure to check CFOL command codes to ensure a refund has not generated.

   Reminder: Do not input the manual refund until the duplicate condition is resolved.

3. Forward the manual refund form to the designated individual for first review, according to the routing instructions for your site (routing instructions will vary by site), and attach necessary documentation (refer to (9) below for a list of necessary documentation and the checklist in Exhibit 21.4.4-2, Manual Refund Checklists). After review, the designated individual will forward to technical lead for second review according to the routing instructions for your site.

4. The technical lead must complete second review of the manual refund form, the attached documentation, and, using the IAT Manual Refund Suite Tool, review information on IDRS. The technical lead must confirm that a manual refund is required and verify the IRM reference requiring the manual refund.

5. The technical lead will send the manual refund documentation forward to the manager to be reviewed and digitally signed, according to the routing instructions for your site (routing instructions will vary by site).

   Note: Digital signatures are required on Form 3753 and Form 5792. The format is SEID followed by the name of the signer. See IRM 3.17.79.3.2.3, Manual Refund Digital Signature Requirement, for required authorized digital signature format on Form 5792.

   Note: Managers and technical leads/designated individuals need to give priority attention to manual refunds. Manual refunds need to be reviewed and returned in time to meet the interest calculation date(s).

6. The initiating employee or designated individual will input a CC NOREF with definer "P" on each IMF manual refund to prevent the issuance of a systemic refund. Refer to IRM 21.4.1.5.10, Refund Intercept CC NOREF with Definer "P", for instructions to complete the CC NOREF with definer "P".

   Exception: If the manual refund is being issued from a module currently indicating a -V or -W freeze or contains an open TC 520 (open bankruptcy case), CC NOREF with definer "P" is not required. When the IAT error message referenced in paragraph "h" below is displayed, select the "Retry" button to bypass the IAT error message.

   Exception: If the manual refund is being issued from a module currently in a balance due status (before the manual refund is input), CC NOREF with definer "P" is not required. When the IAT error message referenced in paragraph "h" below is displayed, select the "Retry" button to bypass the IAT error message.

   Note: There are some extremely limited circumstances when a manual refund and a systemic refund are required on a module, such as some Injured Spouse claims. If a manual refund and a systemic refund are required, do not input CC NOREF with definer "P". Select the "Retry" button to bypass the IAT error message.

   Note: TAS employees must seek approval to input CC NOREF with definer "P" if the account is under control of an operation other than TAS.

7. Refer to Exhibit 2.4.37-7, Input Format Command Code NOREFP for the line-by-line instructions for inputting CC NOREF with definer "P".

   Note: Use the current cycle or, if a posting delay code is used on an adjustment, use the cycle the adjustment will post. An "F" must be entered after the cycle and either "MISC" or "RFDL" must be used as the category code.

8. If CC NOREF is not detected by the IAT Manual Refund Tool an error message will appear in the IAT tool indicating "Input CC NOREFP, following your area guidelines for input, before initiating CC RFUNDR".

   Example: The CC NOREF is looking for a history item that indicates, "RPYYYYNNXX" where "YYYYNN" is the cycle and "XX" is the reason code (RC).

9. The manual refund documentation will be returned to the initiating employee or designated individual, according to the routing instructions for your site (routing instructions will vary by site) for the input of CC RFUND through the IAT Manual Refund Tool. Refer to IRM 21.4.4.5.1.1, IDRS Generated Refund CC "RFUND".

   Note: If inputting CC RFUND between the hours of 6:00 PM, at the Accounting site where your manual refunds are processed, and before 11:59 PM your local time, notate a "Y" in Section IV Box 1 of the Form 5792 along with the number of the employee inputting the CC RFUND. This will alert Accounting that the CC RFUND will have a different date than CC REFAP, but the two command codes were input during the same 24-hour cycle.

10. Input of CC RFUND through the IAT Manual Refund Tool will update the open control on IDRS using Status Code A and "IDRSREFUND" as the activity code.

11. A copy of the Form 5792or a CC RFUND completed screen or a screen capture of CC RFUND is to be attached/kept with the CII case. If the manual refund is rejected for any reason and the Form 5792 is changed or CC RFUND is input for a second time, a new copy of the Form 5792or a CC RFUND completed screen or a screen capture of CC RFUND is to be attached/kept with the CII case. For detailed information on how to attach documents to a CII case, refer to the applicable CII CSR User Guide on SERP under the Local/Sites/Other tab and follow the links to the Correspondence Imaging Inventory (CII).

    Note: The CII case must remain open until after the technical lead or designated individual has reviewed the case and the manager has digitally signed the form to meet the requirements outlined in IRM 21.5.2.4.19, Verifying Complete Adjustments.

12. All manual refund documents will be returned to the technical lead or designated individual after CC RFUND has been input, according to the routing instructions for your site (routing instructions will vary by site).

13. Effective June 20, 2023, initiating sites are no longer required to monitor manual refunds.

    Note: If you want to ensure your manual refunds have been accepted by Accounting, you can load the previous days EMT exports from your C: drive into your EMT/Case Monitoring Tool. Then run the Monitor function on the EMT/Case Monitoring Tool and take action on any cases that are archived as “DQ”. Any cases that are not archived as “DQ” can be deleted from the EMT tool as Headquarters will be monitoring the cases daily. 

    Note: A control base can still be opened on the account when other actions are being taken that need to be monitored for completion; however, a monitoring control base for the manual refund is not required.

14. After items (a) through (m) above have been addressed, forward the completed manual refunds with all back-up documents, according to the routing instructions for your site (routing instructions will vary by site) to the appropriate campus Accounting Function by their designated daily cutoff time.

    Note: Form 5792 must be emailed to the appropriate Accounting site the same day the RFUND command is input. See Exhibit 21.4.4-3, Accounting Function - Manual Refund Team Contact Information, for the appropriate email addresses.

    Note: CC TERUP must be used to delete a manual refund after the CC RFUND has been input. Recalling a manual refund email from Accounting will not delete the TC 840. Also, once a manual refund has been sent to Accounting, it cannot be recalled or canceled without a reject being charged.

15. When emailing manual refunds to the Accounting Function, the email will consist of two attachments. The first attachment will be the Form 5792 and the second attachment will be the back-up documentation. There can be no other documents attached to the Form 5792 attachment. The back-up documentation must all be merged into one PDF file per refund. Multiple manual refunds can be included in the same email. Each document must be saved using the required naming convention. The required naming convention and examples are shown in (9) below. When sending more than three manual refund requests in the same email, they must be in a Zip File. No email can contain more than 25 manual refund requests. Also, the manual refund form number must be the first item on the email subject line. This is so Form 3753 can be identified and given priority. The remaining subject line does not need to be structured. The email must be encrypted but not password protected.

Note: When emailing, only send to the Accounting mailbox. To eliminate the possibility of duplicate refunds, do not carbon copy (cc) anyone else in Accounting.

Note: A separate email must be created for each manual refund form number. Forms 5792 and Forms 3753 cannot be included in the same email file.

16. Refer to Document 12990, Records Control Schedules (RCS) 29, Item 266(3) for the disposition authorization of Form 5792, Request for IDRS Generated Refund (IGR). Form 5792 is a record, and it must be handled according to the National Archives and Records Administration (NARA) authorized disposition. Records will only be destroyed in accordance with authorized instructions found in the IRS Records Control Schedules (RCS).

(8) Processing Form 3753, Manual Refund Posting Voucher:

1. Prepare the manual refund document using the IAT Manual Refund Suite tool. Refer to IRM 21.4.4.5.2, Preparation of Form 3753, Manual Refund Posting Voucher. Use of the IAT CRS tool is mandatory per IRM 21.2.2-2, Accounts Management Mandated IAT Tools.

2. If a duplicate condition is found, the IAT Manual Refund tool will not complete the form. You must resolve the duplicate condition before the tool will allow the completion of the form.

   Reminder: Do not continue with the manual refund until the duplicate condition has been resolved.

3. Forward the manual refund form to the designated individual for the first review, according to the routing instructions for your site (routing instructions will vary by site), and attach necessary documentation. Refer to (10) below for a list of necessary documentation and the checklist in Exhibit 21.4.4-2, Manual Refund Checklists. After review, the designated individual will forward to technical lead according to the routing instructions for your site.

4. The technical lead must complete second review the manual refund form, the attached documentation, and, using the IAT Manual Refund Suite Tool, review information on IDRS. The technical lead must confirm that a manual refund is required and verify the IRM reference requiring the manual refund.

   Note: A control base can still be opened on the account when other actions are being taken that need to be monitored for completion; however, a monitoring control base for the manual refund is not required.

5. The technical lead will then send the manual refund documentation forward to the manager to be reviewed and digitally signed.

Note: Digital signatures are required on Form 3753 and Form 5792. The format is SEID followed by the name of the signer. See IRM 3.17.79.3.2.3, Manual Refund Digital Signature Requirement, for required authorized digital signature format on Form 3753.

6. When the Accounting Function processes the Form 3753, Manual Refund Posting Voucher, they input a history item, a control base, and TC 971 AC 664 on the account.

7. When emailing manual refunds to the Accounting Function, the email will consist of two attachments. The first attachment will be the Form 3753 and the second attachment will be the back-up documentation. There can be no other documents attached to the Form 3753 attachment. The back-up documentation must all be merged into one PDF file per refund. Multiple manual refund requests can be included in the same email. Each document must be saved with the required naming convention. The required naming convention and examples are in (9) below. When sending more than three manual refund requests in the same email, they must be in a Zip File. No email can contain more than 25 manual refund requests. Also, the manual refund form number must be the first item on the email subject line. This is so Form 3753 can be identified and given priority. The remaining subject line does not need to be structured. The email must be encrypted but not password protected.

   Note: When emailing the manual refund request to Accounting, only send to the Accounting mailbox. To eliminate the possibility of a duplicate refund, do not cc anyone else in Accounting.

Note: The email read receipt option can be used to confirm that a Form 3753 has been received by Accounting. To prevent duplicate manual refunds, do not re-send a manual refund request to Accounting after receiving a read receipt from them.

Note: A separate email must be created for each manual refund form number. The Forms 5792 and 3753 cannot be put in the same email file.

8. Refer to Document 12990, Records Control Schedules (RCS) 29, Item 168(4) for the disposition authorization of Form 3753, Manual Refund Posting Voucher. Form 3753 is a record and it must be handled according to the National Archives and Records Administration (NARA) authorized disposition. Records will only be destroyed in accordance with authorized instructions found in the IRS Records Control Schedules (RCS).

(9) The Form 5792 or Form 3753 attachment must be named using the following naming convention: Name Control, Last 4 digits of the TIN, Tax Period 5792/3753 (depending on the form attached). The attachment with the back-up documentation must be named using the Name Control, Last 4 digits of TIN, Tax Period and the literal Doc at the end (this would be all the back-up documentation attachment). Examples are:

(10) The following information must be attached to the manual refund form:

• Sufficient documentation to justify issuing the manual refund (for example: taxpayer correspondence, internal transcript, copy of Form 1040X, Form 1045, Form 4442, Form 8379, the injured spouse worksheet if applicable, Form 1310 (unless a Surviving spouse), Form 843, the taxpayer's hardship documentation or a signed statement from the Local Taxpayer Advocate (LTA) approving the taxpayer's hardship refund request, etc.)

  Note: The documentation attached to the manual refund should not be original documents. Original documents are to be maintained with the original case file. Refer to the CII CSR User Guide for information on how to attach documents to a CII case.

• CC COMPA or Automated Computation Tool (ACT)/Decision Modeling Inc. (DMI) Report 490 (if interest was calculated). The COMPA printout must include COMPA at the top and not be handwritten in.

• CC ENMOD (only if a pending name or address change is indicated)

• Generally, unless required by the IRM of the specific type of manual refund being input, no other IDRS prints are needed to be attached as the Accounting Functions have access to IDRS and can verify the information.

(11) If the original return was coded with CCC 3, "U" coded return (Form 1040), which means that the original return was unprocessable due to no reply from a correspondence sent from the error resolution area, attach a copy of the completed REQ54 screen showing that a return processable date (RPD) was input with the adjustment. If a previous adjustment was input to the module that contained a RPD, then a copy of the REQ54 screen is not needed. If the RPD has been input, it will be reflected on CC IMFOLR/BMFOLR.

(1) Manual refund initiators must calculate any interest due to the taxpayer and include it on their Form 5792/Form 3753.

1. When computing interest with CC COMPA, to determine the “From” date, see the table below:

If the taxpayer	Then allow interest from the later of
Timely filed (i.e., return received by the original or extended due date),	The return due date (determined without regard to any extension of time for filing), the payment date or return processable date (provided the RPD is after the due date), including any extensions of time for filing).
Late filed (i.e., return not received by the original or extended due date)	The late return received date, the payment date, or the CRD/RPD (if present).

2. To determine the payment date, see the table below:

If the payment resulting in an overpayment is a	Then the date of the overpayment is the
Prepaid or timely credit, e.g., estimated tax payment, withholding, or a payment before the due date (determined without regard to any extension of time for filing)	Due date of return. (Determined without regard to any extension of time for filing).
Subsequent payment made after the due date (determined without regard to any extension of time for filing)	Payment received date. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

3. To determine the “To” date, see the table below:

If the return	Then
Indicates an overpayment	The interest To date is the date certified by the Accounting Function for allowing the refund, which date must not precede the date of the refund check by more than 30 days.

(2) Use the appropriate CC COMPA definer to compute credit interest for the period determined in (1) above. See the table below:

(3) Any function initiating a manual refund for $1 million or more that contains credit interest, is required to perform an additional review (to be determined by that function) to verify the accuracy of the interest, and to identify and correct any errors.

(4) Manual refunds of $1 million or more, initiated by Accounts Management employees, and containing credit interest, are required to be reviewed by the Technical Unit. These procedures require the Form 3753 or Form 5792 to be forwarded to the Technical Unit for review. These requests must be received by 2:00 P.M. local time at the receiving campus to complete review. Requests received after 2:00 P.M. will be completed the following business day.

1. For employees in sites that have a Technical Unit, the Technical Unit will verify the accuracy of the credit interest, identify and correct any errors and return the refund to the originator.

2. For employees in sites that do not have a Technical Unit, fax Form 3753 or Form 5792, including a copy of the interest computation, to:
   
   For IMF modules:
   Philadelphia, TS CAS:PAMC
   Attention: Adjustments P&A Staff
   EEFax Number: 866-434-7054
   
   For BMF modules:
   Ogden, TS CAS:OAMC
   Attention: Technical Interest Team 203 Manager
   EEFax Number: 855-269-1647
   

3. The Technical Team will verify the accuracy of the credit interest, identify and correct any errors and fax the approved Form 3753 or Form 5792 to the initiator the same day. Employees in these sites must attach a copy of the approved faxed Form 3753 or Form 5792 to be forwarded to Accounting. If any corrections were made, a new Form 3753 or Form 5792 will have to be completed.

4. Each refund reviewed must have the "Interest Approved" signature and date. This signature can be placed at the bottom of the Form 5792/Form 3753 near Part one literal by inserting a text box if using a PDF electronic copy or they can be handwritten if forwarding paper copy. Accounting will reject any manual refund requested by Accounts Management more than $1 million that has not been reviewed by the Technical Unit.

5. A copy or fax of any corrections to the interest computation will also be referred to the manager of the initiator.

(5) When issuing a manual refund to a person or address other than that shown on Master File (CC ENMOD or CC INOLE), input a TC 971 AC 037 using the CC RFUND input date as the Transaction Date and enter the Taxpayer Identification Number (TIN) of the entity receiving the refund. When the SSN/EIN of a third party is needed, the third party can only be solicited for this information through written correspondence because privacy rights must be given with the solicitation. Since Form 1310, Statement of Person Claiming Refund Due a Deceased Taxpayer, includes the required Privacy Rights provisions, it can be used to request the SSN/EIN of a third party. Refer to IRM 21.4.6.5.10.6 (8), Issuing the Injured Spouse Refund, for TC 971 AC 037 instructions when working an Injured Spouse claim.

(6) When issuing a manual refund from an account without a TC 150, monitor the account and release the -X freeze when there are no expectations of a return being filed.

(7) In addition to explaining why a different entity is necessary on Forms 5792/Form 3753, indicate where the back-up documentation can be found (e.g., injured spouse, now separated, attached to nnn-nn-nnnn, 200812, TC 290).

(8) When issuing a refund on a decedent account and a Form 1310 is required, ensure Part I is completed. Refer to IRM 3.11.3.10.3, Documentary Evidence on a Decedent Return, for procedures on identifying a correctly completed Form 1310.

(9) If an offset credit is being refunded, refer to IRM 21.4.6.4.1.1, Tax Offset Reversal, to determine when the offset must be reversed back to the original module instead of being refunded.

1. If a reversal of offset credit is NOT required per IRM 21.4.6.4.1.1, Tax Offset Reversal, then notate in the remarks field of the Form 5792 or Form 3753 that a reversal of the TC 706 is not required.

2. If a reversal of offset credit IS required per IRM 21.4.6.4.1.1, Tax Offset Reversal, input a TC 570 with the reversal transaction to prevent an UPC 198, re-offset, or refund that would create an erroneous refund condition. Refer to IRM 21.5.8.4.5, TC 570 and Bypass Indicator, for more information on TC 570 and UPC 198.

(10) Joint Committee Cases per IRC 6405: employees must provide the supporting documentation from the Chief of Staff. See IRM 4.36.4, Joint Committee Review Team Procedures.

(1) The following subsections provide information on programs which are not readily available in other IRM chapters. Programs discussed here are Credit Card Chargebacks, and Photocopy Fee Refunds.

(1) Thorough research is required on all manual refunds prior to issuance.

1. The table below summarizes the basic research required for all manual refunds (those issued on Form 5792, Request for IDRS Generated Refund (IGR), and Form 3753, Manual Refund Posting Voucher):

IDRS Research Required on All Manual Refunds.
Verify: TIN MFT and Tax Period Payee name and address Debt indicators (TOP offset), XREF TINs, TC 130 Indicator The following information must be attached to the manual refund form: Sufficient documentation to justify issuing the manual refund (for example: taxpayer correspondence, internal transcript, copy of Form 1040X, Form 1045, Form 4442, Form 8379 or the injured spouse worksheet if applicable, Form 1310, Form 843, the taxpayer's hardship documentation or a signed statement from the Local Taxpayer Advocate (LTA) approving the taxpayer's hardship refund request, etc.) CC COMPA or Automated Computation Tool (ACT)/Decision Modeling Inc. (DMI) Report 490 (if interest was calculated) CC ENMOD (only if a pending name or address change is indicated) Generally, unless required by the specific type of manual refund being input all other IDRS prints are not required to be attached to the manual refund request, as the Accounting Functions have access to IDRS and can verify the information.
Input TC 971 AC 037 as applicable Note: A manual refund cannot be issued to a POA Verify RSED open/expired Research freeze codes Review for any pending TCs that would release a TC 570, freeze codes, or the K- freeze set by a HC 1, 2, or 4.
Verify outstanding balances (OBLs); research all related accounts (IMF, BMF, NMF) for OBLs using the following CCs: CC SUMRY CC TXMOD CC IMFOLI/CC BMFOLI CC IMFOLT/CC BMFOLT
Research CC TXMOD for TC 971 AC 664, which indicates a manual refund has been scheduled/issued by the Accounting Function using Form 3753, Manual Refund Posting Voucher.
Review/verify "O" (letter O) coded returns - See Document 6209, IMF Computer Condition Codes. "O" code identifies a pre-settlement manual refund was paid.
Attach offset bypass refund (OBR) or hardship verification, if applicable.
Research CC FFINQ - Requests IMF from the Fact of Filing information file.
Review manual refunds over $1 Million - Technical unit is required to review credit interest.
Resolve other open controls and receive approval from other functions (if applicable) to process the manual refund.
Input/review for TC 291, TC 295, TC 299, TC 766 with a HC 1, 2, or 4. Input TC 570 as applicable.

2. A review of the sections of Form 5792, Request for IDRS Generated Refund (IGR), is shown below. See IRM 21.4.4.5.1, Preparation of Form 5792, IDRS Generated Refund, for additional information.

   Note: The use of the IAT Manual Refund Tool is mandatory for preparation of manual refund forms and CC RFUNDR input per IRM 21.2.2-2, Accounts Management Mandated IAT Tools.

Form 5792 Checklist
Verify the following information in Section I (Account information) of the Form 5792: Box 6, TC 840 amount (math verify that box 7 + box 8 = box 6) Box 9, Line Number (see IRM 2.4.20, Command Codes RFUND and REFAP) Box 13, Blocking Series (as applicable) Box 14, First Name Line Box 18, Street address or P.O. number Box 19, City, State, and Zip code Box 20, Remarks (to explain the reason for the manual refund) Note: If the RSED is expired, a notation must be included in the Remarks section to state the Statute issue has been reviewed and the credit is available for refund. Notations must be clear and can include “Timely filed, No RSED Issue” or “RSED allowable”. Before initiating the manual refund, you must determine the credit availability. Box 22, DLN of return
Verify the following information in Section II (Manual Refund Authority) of the Form 5792: Box 1, c, Handbook Reference - Input the specific IRM that confirms the reason for the manual refund. IRM 21.4.4 cannot be used as the IRM reference for this box. Box 3, IDRS and Master File researched for outstanding balances and TC 130 Box 4, Transcript of debit accounts attached (ONLY if box is checked) Box 5, Evidence of Credit Condition (mark appropriate box if applicable) Box 6, Necessary back-up documents attached - For example, taxpayer correspondence, internal transcript, copy of Form 1040X, Form 1045, Form 4442, Form 8379, injured spouse worksheet, Form 1310, Form 843, etc. (this list is not all- inclusive) Box 7, Verify refund amount with source document amount Box 8, All items above completed - Verify that all applicable items in Section I - Account Information are completed Box 11, By Pass Indicator (BPI) - Confirm the BPI has been input on the adjustment if applicable. See IRM 21.4.6, Refund Offset
Verify the following information in Section III (Interest Computation) of the Form 5792: Input the interest "From" and "To" date(s) and the interest amount, or Input "Original Interest" in Section I Box 20 - "Remarks" if an original amount of interest will be issued or Attach a COMPA print or ACT/DMI Report 490 indicating the applicable interest computation See IRM 20.2.4.8.2, Manual Refunds, for information on computing credit interest
Verify the following information in Section IV (Manual Refund Approval) of the Form 5792: Box 1, Number of the employee inputting REFUND via IDRS - Must match the information shown in IDRS or the manual refund will be rejected Box 2, Request prepared by (Name) - Box 2a, SEID - Must match the SEID shown in IDRS or the manual refund will be rejected Box 3, Phone number - Must be a valid phone number for the area. Cannot be a 1-800 number Box 4, Digital Signature of approving official - A “SEID” digital signature format must be used on Form 5792. (The digital signature must include the SEID and name of the approving official on the active Form 14031 - Section II on file.) Reminder: See IRM 3.17.79.3.2.3, Manual Refund Digital Signature Requirement, for required authorized digital signature format on Form 5792.

3. A review of the sections of Form 3753, Manual Refund Posting Voucher, is shown below. See IRM 21.4.4.5.2, Preparation of the Form 3753, Manual Refund Posting Voucher, for additional information.

   Note: The use of the IAT Manual Refund Tool is mandatory for preparation of manual refund forms per IRM 21.2.2-2, Accounts Management Mandated IAT Tools.

Form 3753 Checklist
Verify the following information in Section I (Account Information) of the Form 3753: Box 7, Name and address Box 9, DLN of return Box 10b, TC 840 amount (math verify that box 13 + box 10d = box 10b) Box 11, Make check payable to - If the payee is other than the taxpayer or if the refund is being issued to a different address Box 14, Universal Location Code (ULC) Box 15, Line number (see IRM 2.4.20, Command Codes RFUND and REFAP)
Verify the following information in Section II (Manual Refund Authority) of the Form 3753: Box 1c, Handbook reference - Input the specific IRM reference that confirms the reason for the manual refund. IRM 21.4.4 cannot be used as the IRM reference for this box. Box 2, Evidence of credit condition (mark appropriate box) Box 3, Interest (mark appropriate box) Verify the following information in the open section of Section II: All items above completed - Verify that all applicable items in Section I - Account Information are completed IDRS and Master File researched for outstanding balances and TC 130 Transcript of debit accounts attached Necessary back-up documents attached - For example: taxpayer correspondence, internal transcript, copy of Form 1040X, Form 1045, Form 4442, Form 8379, injured spouse worksheet, Form 1310, Form 843, etc. (this list is not all-inclusive) Verify refund amount with source document amount By Pass Indicator - Confirm the BPI has been input on the adjustment if applicable. See IRM 21.4.6, Refund Offset
Verify the following information in Section III (Interest Computation) of the Form 3753: Input the interest "From" and "To" date(s) and the interest amount See IRM 20.2.4.8.2, Manual Refunds, for more information on computing credit interest
Verify the following information in Section IV (Other Remarks) of the Form 3753: Remarks (to explain the reason for the manual refund Note: If the RSED is expired, a notation must be included in the Remarks section to state the Statute issue has been reviewed and the credit is available for refund. Notations must be clear and can include “Timely filed, No RSED Issue” or “RSED allowable”. Before initiating the manual refund, you must determine the credit availability. Initiating BOD. (mark appropriate box)
Verify the following information in Section V (Manual Refund Approval) of the Form 3753: Box 1, Digital Signature of approving official - A “SEID” digital signature format must be used on Form 3753. (The digital signature must include the SEID and name of the approving official on the active Form 14031 - Section II on file.) Reminder: See IRM 3.17.79.3.2.3, Manual Refund Digital Signature Requirement, for required authorized digital signature format on Form 3753. Box 2, Name of originator - Box a, SEID Box 3, Date Box 4, Phone Number - Must be a valid phone number for the area. Cannot be a 1-800 number