US Internal Revenue Service: p4163

Modernized e-File (MeF)
Information for Authorized
IRS e-file Providers
Tax Year 2006
Publication 4163
Revision 2, May 1, 2007
Cat. No. 36165C

INTERNAL REVENUE SERVICE
MISSION STATEMENT
Provide America’s taxpayers top quality service

by helping them understand and meet their tax
responsibilities and by applying the tax law with
integrity and fairness to .
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Table of Contents
Part I – Introduction Page

New Information 8
Overview of Modernized e-File (MeF) 8
Benefits of IRS e-file 9
Publications for Tax and Information Returns 10
Request for Publications 11
Communications 11
Questions, Suggestions, or Concerns
e-mail
Quick Alerts
e-Help Desk
IRS Web Site
Temporary Treasury Reg Section 301.6011-5T Filers
IRS Services Phone List 14
The IRS Website 15
Application to Participate in the IRS e-file Program 16
Part II – Processing Year 2007 Information
Highlights of Tax Year 2006, Processing Year 2007 18

• General Items of Interest
The Tax Relief and Health Care Act of 2006 21
Amended and Superceded Corporate Returns 23
Return/Extension Due Date Charts 24
Returns Not Eligible For Mef 25
MeF Fed/State Program 28

Part III– Rules and Requirements for Modernized e-File Providers
General 31
Protecting Taxpayer Information Gramm Leach Bliley Act for 1999 & 31
Federal Trade Commission Rules
Safeguarding of Modernized e-File from Fraud and Abuse 32
Returns Filed Through Modernized e-File 33
Responsible Officials 33
Delegated Users 34
Reporting Changes 34
Submitting a Timely Filed Electronic Tax Return 35
Disclosure of Tax Return Information 35
Preparer Penalties 36
Suspensions 36
Advertising Standards 36
Paperwork Reduction Act Notice 37
Obtaining, Handling, and Processing Return Information From Taxpayers 37
Safeguarding Modernized e-File From Fraud and Abuse 38
Part IV – Procedures for Electronic Return Originators of Corporate

MeF Returns
Be Careful With Addresses 40
Foreign Address 40
Address Changes 40
Name Controls 41
NAICS Codes 41
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Refund Returns 41
Balance Due Returns 43
Electronic Funds Withdrawal 43
Credit Card Payments 44
Payment Cancellation 45
Electronic Federal Tax Payment System (EFTPS) 45
Pay by Check 45
Signing an Electronic Tax Return 46
Scanned 8453 Option 48
Elections That Require Separate Signatures 48
Special Instructions When Attaching Binary Files 48
Special Instrucitons for Form 8865 48
Avoiding Refund Delays 48
Submitting the Electronic Return to the IRS 49
Record Keeping and Documentation Requirements 49
Providing Information to the Taxpayer 50
Acknowledgements of Transmitted Return Data 50
Resubmission of Rejected Extensions 51
Transmission Perfection Period For Corporate Returns 51
Part V – Procedures for Transmitters of Corporate MeF Returns
General 55
Transmitter Requirements 56
Additonal Transmitters Responsibilities for On-Line Providers 57
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Electronic Postmark 58
Routine Maintenance 59
Part VI – Procedures other Authorized IRS e-file Providers
Intermediate Service Providers 61
Software Developers 62
Part VII – Guidelines For Tansition From Paper to Electronic Filing
Transition From Paper to Electronic Filing 64
Preparing Supporting Data Required by IRS Forms or Form Instructions 64
Creating Elections Required by Forms or Form Instructions 69
Creating Elections/Disclosure Statements Required by Regulations or 69

Publications
Preparing elections That Require Supporting Data 71
Part VIII – MeF Section for Forms 1120/1120-S
General 73
Forms Attached to For 1120/1120-S with Separate Signatures 73
Signing an Electronic Return 74
Special Instructions When Copies of Original Forms are Required Prior to 74

Filing the Electronic Return
Special Instructions for Form 1120 , Line 32f Credits 75
Special Instructions for Form 1120 Section 847 Special Estimated Tax 75
Payments (SETPs)
Special Instructions for Form 8838 When Filed with Form 1120 75
Checksum For Form 1120 Filers 75
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Tax Year 2006 Due Dates 77
Tax Year 2004 Accepted Forms and Schedules (1120/1120S) 78
Part IX- MeF Section for Forms 1065/1065-B
Tax Year 2006 Due Dates (1065/1065-B) 88
Tax Year 2006 Accepted Forms and Schedules 89
Part X - MeF Section for Forms 990, 990EZ, 990PF, 1120POL, 8868
Extension Request for Exempt Organization Returns 92
Tax Year 2006 Due Dates 93
Tax Year 2006 Accepted Forms and Schedules 94
Part XI- MeF Section for Form 7004
Significant Changes 97
Form 7004 Application for Automatic 6 Month Extension of Time to File 97

Certain Business Income Tax, Information and Other Returns
Tax Year 2006 Due Dates For Specific Form Types 99
Part XII- e-File Information for Large Taxpayers
“Large Taxpayer” Provider Option 105

Preparing Your Return 105
Integrating Data/Elections into Your Return 106
Check Your Return 108
Transmitting Your Return 108
Methods to Transmit Your Return 109
Transmission Channels 110
Process to Transmit Your Returns 111
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Exhibits
Exhibit 1 – Business Name Controls 113
Exhibit 2 - Forms and Attachments Listing 115
Exhibit 3 - Foreign Country Codes 116
Exhibit 4- Standard Street Address Abbreviation 123
Exhibit 5 - Valid ZIP Codes 126
Exhibit 6 - Codes for Principal Business Activity (NAIC Codes) 129
Exhibit 7 - Business Rules 131
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______________________________________
PART I
INTRODUCTION
______________________________________
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New Information
In tax year 2006 (processing year 2007), the IRS is enhancing the MeF system by
adding the capabilities to e-file Form 1065, U.S. Return of Partnership Income and Form
1065-B, U.S. Return of Income for Electing Large Partnerships.
In future releases, the IRS plans to transition the existing e-file programs for Forms
1040 and 1041 to MeF. IRS will also begin accepting form 1120-F(US Income Tax
Return of a Foreign Corporation) beginning January 2008. IRS will use the procedures
in this publication as a standard for all e-file programs in the future.
IRS has combined information for Corporate, Partnership and Exempt Organization
returns in this publication. Unless otherwise indicated, all information applies to all three
return types.
This publication and its updates or revisions are available at www.irs.gov. Change
pages, outlining the extent of any update/revision, will be posted separately.
Beginning in processing year 2007 all International Returns processed through MeF will
be processed at the Ogden Processing Center.
Implementation of Excise Tax e-Filing and Compliance (ETEC) returns will take place in
the summer of 2007. The Forms 2290, 720 and 8849 will be accepted through the
Modernized e-file System.
Note: A special section for each form type has been added to this publication to
address specific situations for each form. These sections can be found at the end of
this document.
Overview of Modernized e-File (MeF)
The Modernized e-File (MeF) system is used to process electronic Forms 1120, 1120-S,
7004, 990, 990EZ, 990PF, 1120POL, 8868, 1065 and 1065-B returns. Forms 2290,
720 and 8849 will be added Summer 2007. IRS spent over three years on the design
and development of the MeF system to ensure the needs of taxpayers were
understood. IRS created a stakeholder group comprised of accounting firms and
software vendors. This stakeholder group worked closely with the IRS during all phases
of design, development and implementation of MeF. Many complex issues were
identified and the solutions were incorporated into the design of MeF to ensure the most
complicated income tax and information returns can be processed electronically. The
project became one of the top IRS modernization projects and was placed on the new
IRS architecture.
All returns electronically filed, including International returns, using the MeF system are
processed at the Ogden Processing Center.
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Benefits of IRS e-file
• More Explicit Error Conditions - New error code explanations pinpoint the
location of the error in the return and provide complete information in the
Acknowledgement File.
• Faster acknowledgements - Transmissions are processed upon receipt and

acknowledgments are returned in near real-time. No more waiting for once or
twice daily system processing cycles.
• Integrated Payment Option - Owe Taxes? - You can e-file a balance due
return and, at the same time, authorize an electronic funds withdrawal from your
bank account. Payments are subject to limitations of the Federal Tax Deposit
Rules.
When the forms listed below are included as part of the electronic return, the
requirement to submit duplicate copies of the forms to the Ogden Submission
Processing Center (OSPC) is eliminated.
o Form 5471---Information Return of US Persons With Respect To Certain
Foreign Corporations
o Form 5472---Information Return of a 25% Foreign-Owned US Corporation or
a Foreign Corporation Engaged in a US Trade or Business
o Form 5713---International Boycott Report
Modernized e-File includes several new features which are different from other e-file
programs. Check with your software developer to ensure these features are available.
The MeF system allows Transmitters to send transmissions to the IRS year
round, 24 hours a day. The MeF system validates the transmission file and
creates an acknowledgement file immediately. Many acknowledgements are
returned in 2-3 minutes or less, depending on the size of the transmission file
and the volume being processed at the time.
100% of the forms that can be attached to Forms Forms 1120, 1120-S, 7004,
990, 990EZ, 990PF, 1120POL, 8868 and 1065, 1065-B are included in MeF. As
IRS adds new forms that can be filed with these forms, they will be added to the
MeF system.
MeF is completely paperless. EROs can sign the return using a Practitioner PIN
or have the option to scan the jurats, Form 8453-C, Form 8453-S, 8453-PE,
8453-B, 8453-EO, and transmit them electronically to the IRS with the tax return.
IRS MeF will not accept paper copies of any of the jurats.
IRS will maintain three tax years (currently 2004, 2005, 2006) of existing MeF
form types. As a new tax form type is added to the MeF platform (i.e. Form
1065), tax returns will only be accepted for the current processing year (i.e. TY
2006). As subsequent tax years are added to the system, MeF will only accept
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the current processing year and two prior tax years. For example, Form(s)
1120/1120-S can only be e-filed for TY2006, TY2005 and TY2004.
Rejects are now referred to as “Business Rules” and have been restated to be
specific in defining the location of the error and the error is stated in plain
English.
Publications for Tax Returns and Information Returns
This edition of Publication 4163, Modernized e-File (MeF) Information for Authorized
IRS e-file Providers, replaces the previous edition revised February 2006 and the
Publication 4206 for Exempt Organizations. This publication is designed to provide
specific requirements and procedures for electronic filing through the Modernized e-File
(MeF) system for:
• Form 1120, U. S. Corporation Income Tax Return,
• Form 1120-S, U. S. Income Tax Return for an S Corporation,
• Form 7004, Application for Automatic 6-Month Extension of Time to File Certain
Business Income Tax Information, and Other Returns.
• Form 990, Return of Organization Exempt From Income Tax
• Form 990EZ, Short Form Return of Organization Exempt From Income Tax
• Form 990PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt
Charitable Trust Treated as a Private Foundation
• Form 1120POL, U.S. Income Tax Return for Certain Political Organizations
• Form 8868, Application for Extension of Time To File an Exempt Organization
Return
• Form 1065, U.S. Return of Partnership Income
• Form 1065-B, U.S. Return of Income for Electing Large Partnership.
• Form 2290, Heavy Highway Vehicle Use Tax Return,
• Form 720, Quarterly Federal Excise Tax Return,
• Form 8849, Claim for Refund of Excise Tax,
The procedures in this publication should be used in conjunction with the following
publications:
Publication 3112, IRS e-file Application and Participation - contains information

about the roles of software developers, transmitters and electronic return
originators. IRS has standardized the information for all e-file programs.
Publication 4162, Modernized e-File Test Package for Forms 1120/1120-S -

contains the instructions and test case scenarios for software developers and
transmitters to use for Assurance Testing System (ATS) of 1120/1120-S. This
publication also contains the instructions and test case scenarios for Form 7004,
Application for Automatic 6-Month Extension of Time to File Certain Business
Income Tax, Information, and Other Returns.
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Publication 4164, Modernized e-File (MeF) Guide for Software Developers and
Transmitters – contains communications, procedures, transmission formats,
business rules, and validation procedures for returns e-filed through the
Modernized e-File System.
Publication 4205, Modernized e-File Test Package for Exempt Organization

Filings - contains the instructions and test case scenarios for software developers
and transmitters to use for Assurance Testing System (ATS) of Forms 990, 990-
EZ, 990-PF, 1120-POL, and 8868
Publication 4505, Modernized e-File Test Package for Forms 1065/1065-B –

contains the instructions and test case scenarios for software developers and
transmitters to use for Assurance Testing System (ATS) of 1065/1065-B.
Publication 4594, Modernized e-File Test Package for Forms 2290, 8849 and
720 – contains instructions and test case scenarios for software developers and
transmitters to use for Assurance Testing System (ATS) of these forms.
• IRS e-file For Large Tax Exempt Entities Filing Their Information Returns
contains guidance for charities and non-profits that prepare their own information
return. This document is intended to assist tax exempt organizations with their
transition from preparing a paper return to electronic filing. Tax exempt
organizations should review this document and other useful information,
including Frequently Asked Questions available at http://www.irs.gov/ . Simply
click on the “e-file” logo and then click on “e-file for Charities and Non-Profits”.
Request for Publication
These Publications and their updates are available at irs.gov using this link:
IRS e-file Technical Publications
Or by entering “publication” in the Keyword Search”

Or take the following steps on the irs.gov web site:
¾ Click on the e-file logo

¾ Click on e-file for Software Developers & Transmitters
¾ Click on the appropriate forms that you are searching for (i.e.Form 1120/1120-
S/7004 XML Schemas)
¾ Go to User Guide & Publications; select the publication you need.
Communications
IRS has worked in partnership with many MeF stakeholders to develop the information
contained within this publication. If you have any questions, suggestions or comments
regarding this publication, or are aware of any errors (typographical, technical or
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usage), please let us know by e-mailing the appropriate program at the following
addresses or write to:
For Form 7004 and Form 1120/1120-S, please send an email to [email protected] or write
to:
Internal Revenue Service
1120 Program, SE:W:ETA:D:D1
Stop 1265AUSC
P.O. Box 934
Austin, TX 78767

NCFB C4-338
5000 Ellin Road
Lanham, MD 20706
For Form 990, 990EZ, 990PF, 1120POL, 8868, please send an email to TE/GE-EO-
[email protected] or write to:

990 Program SE:T:CAS:SC
MS 1110
1973 N. Rulon White Blvd.
Ogden, UT 84404
For Form 1065, please send an email to [email protected] or write to:

NCFB C4-278
5000 Ellin Road
Lanham, MD 20706
For Forms 2290, 8849 and 720, please send an email to *[email protected] or write to:

ETEC (720, 2290, 8849) Program
NCFB C4-401
5000 Ellin Road
Lanham, MD 20706
The following list of communication vehicles will be used to distribute information

and updates to MeF stakeholders:
e-mail - Each MeF Team maintains an e-mail distribution list of current and
prospective partners. On an as needed basis, updates and other
communications are distributed to the group. To have your e-mail address
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added to the group, please send an e-mail with your name, company name, and
any other relevant contact information, including your role (Electronic Return
Originator (ERO), Software Developer or Transmitter) to the e-mail box indicated
above specific to your form type.
Quick Alerts is a FREE web based mass messaging system created for
Authorized IRS e-file Providers, which include Software Developers,
Transmitters, and Electronic Return Originators. Software Developers and
Transmitters use their ETIN. EROs use their 6 digit EFIN. If you have received
both an ETIN and an EFIN, then you should use your ETIN. The Quick Alerts
messaging system uses a "push technology" program that can instantly
disseminate messages to thousands of subscribers via pre-selected vehicle of
choice(s): cell phone, e-mail, fax, telephone. Subscribers will receive
communications 24 hours a day - 7 days a week, regarding processing delays,
IRS e-file program updates, early notification of upcoming seminars and
conferences. New subscribers may sign up at
www.Envoyprofiles.com/quickalerts or through the links provided on the “Tax
Professionals” page at http://www.irs.gov/
The Ogden e-Help Desk provides MeF assistance for both software and
communication testing and during transmission of returns through out the filing
season. Software developers, transmitters and electronic return originators may
call the Ogden e-Help Desk at 1-866-255-0654.
IRS Website—A link for helpful web pages can be found by going through the
http://www.irs.gov/ home page. Click on the e-file logo for information about e-
file options for business partners including a list of approved e-file business
products.
EROs that have clients who are required to file under Temporary Treasury
Regulation Section 301.6011-5T, issued January 11, 2005, may register to
receive the latest updates from IRS. Register at irs.gov under e-file for Large
and Mid-size Corporations.
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Topic Services Offered Number
Application/Suitability IRS e-file Application (irs.gov)

To obtain additional information regarding
the e-services Registration and IRS
e-file Application process go to:
http://www.irs.gov//taxpros/article/0,,id=109646,00.html/
Paper Application (Form 8633) 1-866-255-0654
Obtain answers to questions regarding Outside US &

the IRS e-file Application process or US Territories
about the status of an application 512-416-7750
_____________________________________________________________________________
Electronic Funds Providers may check the 1-888-353-4537
Withdrawal (Direct status of payments and the status of
Debit) Deposits cancelled warehoused (deferred)
payments
_____________________________________________________________________________
Publications Order IRS publications and tax 1-800-829-3676
& Tax Forms forms by phone or go to:
http://www.irs.gov/taxpros/lists/0,,id=97782,00.html/
_____________________________________________________________________________
e-Help Obtain assistance with electronic business 1-866-255-0654
tax filing by calling the e-Help Desk
_____________________________________________________________________________
Tax Help Request IRS Tax Assistance 1-800-829-4933
Business Taxpayers
_____________________________________________________________________________
TeleTax Listen to Automated tax help 1-800-829-4477
(Recorded Tax see topic numbers in tax package
Information)
_____________________________________________________________________________
Fraud Report suspicious activity in the IRS 1-800-829-0433
e-File Program by calling the 1-800 number
or e-mailing to [email protected];
______________________________________________________________________________
Electronic Federal Make ALL your federal tax payments, 1-800-829-4933
Tax Payment System including income, employment, and
(EFTPS) excise taxes
_____________________________________________________________________________
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The IRS Web Site
www.irs.gov
The following areas exist within the IRS Web Site. Areas may vary slightly as revisions are made to this site.
Go to www.irs.gov/efile to find:
e-file for Tax Professionals
Get Ready, Get Set Go! Important notes and dates about IRS e-file
for the 2006 Filing Season
IRS e-file Application Updates Information on submitting a new or revised

e-file application
e-Services Suite of Web-based products that allow tax

professionals and payers to do business
with the IRS electronically
IRS e-file Made Easy – a Tax Professional’s One-Stop resource center for IRS e-file and
One-Stop e-file and e-Pay shop e-payment information
QuickAlerts Important e-file messages
Electronic Payment Options Information on tax types and processing

periods for electronic payments
e-file Library The IRS e-file Library
Federal/State e-file Information on Federal/State e-file
e-file Resources for Providers and EROs Includes Marketing Toolkit with e-file
promotional products
Subscription Services Subscribe to receive QuickAlerts, Digital

Dispatch, and local IRS information
e-file for Large and Mid-Size Corporations Includes MeF Issues and Solutions
Go to www.irs.gov/taxpros to find:
Current tax information for tax professionals
Go to www.irs.gov/newsroom to find:
Latest information from the IRS
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Application To Participate in the IRS e-file Program
In order to begin e-filing tax returns, you must apply and be accepted as an Authorized
IRS e-file Provider. For more information on the application process refer to Publication
3112, IRS e-file Application and Participation. This publication contains all the
information needed to apply. The quickest way to apply is to use the IRS e-file
Application On-Line.
For more information go to the link below:

http://www.irs.gov//taxpros/article/0,,id=109646,00.html
Note: TO AVOID REJECTED RETURNS - EROs/Transmitters must have an

application on file and it must be current with all the form types that are going to
be e-Filed. If a return type that is not on the e-File application is electronically
filed that return will be rejected (Error Reject 905). Having a current application
on file with the IRS will avoid having returns rejected for this reason. .
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Part II
Processing Year 2007
Information
____________________________________________________
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____________________________________________________
Highlights for Tax Year 2006, Processing Year 2007
Note: TO AVOID REJECTED RETURNS - EROs/Tranmitters must have an

application on file and it must be current with all the form types that are going to
be electronically filed. If a return that is not on the e-File application is
electronically filed that return will be rejected (Error Reject 905). Having a current
application on file with the IRS will avoid having eturns rejected for this reason.
General Items of Interest

MeF is implementing the 1065 and 1065-B programs in January of 2007.
Partnerships can now transmit 1065 and 1065-B returns through the MeF
system using the same transmission methods allowed for the 1120 program.
MeF will beging accepting the ETEC Program returns (Forms 2290, 8849 and
720, ) in the summer of 2007.
In processing year 2007 Transmitters will be able to send state submissions through
both Application to Application (A2A) and Internet Filing Application (IFA). States will
only be able to use A2A to pick up state returns and send IRS their state
acknowledgments.
Tax Year 2005 - Temporary Treasury Regulation Section 301.6011-5T,
issued January 11, 2005, required corporations who have assets of $50
million or more and file at least 250 returns a year to electronically file
Forms 1120 and 1120-S for tax years ending on or after December 31, 2005.
Exempt organizations filing Form 990, who had total assets of $100 million or
more and file at least 250 returns a year are required to file electronically.
Tax Year 2006 – Temporary Treasury Regulation Section 301.6011-5T,

issued January 11, 2005, required corporations who have assets of $10
million or more and file at least 250 returns a year to electronically file
Forms 1120 and 1120-S for tax years ending on or after December 31, 2006.
Exempt Organizations who have total assets of $10 million or more and file at
least 250 returns a year are required to file Form 990 electronically. Private
Foundations who file at least 250 returns a year are required to file Form 990-
PF electronically regardless of their total assets.
NOTE: A corporation or organization is determined to have met the 250 return

requirement if, during the calendar year ending with or within the taxable year of
the corporation or organization, it is required to file a total of at least 250 returns
of any type, including employment returns, excise tax returns, and information
returns. IRS developed special guidance to assist corporations and exempt
organizations with the transition from filing a paper return to electronic filing. This
guidance applies to corporations required to e-file under temporary regulations.
Corporations and exempt organizations required to e-file should review this
information available at www.irs.gov . Simply click on the “e-file” logo and then
click on “e-file for Large and Mid-Size Corporations or “e-file for Charities and
Non-Profits.
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Although electronic filing is required of certain corporations and exempt
organizations, the majority of returns filed through the MeF system are
voluntary
MeF e-filing capabilities have been extended to the following:
Short Period Returns (Corporate and Partnership Returns Only). If a short

period return is being filed you must include the reason for filing the return.
Note to Transmitters: The tax year in the Return Manifest and Return Header
must reflect the current tax year being processed (i.e. TY 2006), then input
the actual Beginning and Ending Dates of the short period return (i.e.
1/01/2007 to 02/28/2007. If you are filing a short period return after January
of the current year, and you don’t have the current year software available to
you, then you must use the prior year software to file your short period return
and you must use the prior tax year in the return header, then input the actual
Beginning and Ending Dates for the short period return.
Final Period Returns (Corporate, Partnership and Exempt Organization

Returns)
Amended returns for all MeF supported returns (excludes Forms 7004 and
8868 extensions). For the 990 and 1065 programs MeF will accept amended
returns for TY2006; For the 1120/1120S programs MeF will accept TY2005
and TY2006 amended returns.
Form 1065, U.S. Return of Partnership Income
Form 1065-B, U.S. Return of Income for Electing Large Partnerships
XML schemas were developed and issued for the following new forms that can
be attached to the 1120/1120-S return:
o Schedule O (Form 1120), Consent Plan and Apportionment Schedule for

a Controlled Group
o Schedule M-3 (Form 1120-S), Net Income (Loss) Reconciliation for S

Corporations With Total Assets of $10 Million or More
o Form 1120-L, U.S. Life Insurance Company Income Tax Return
o Schedule M-3 (Form 1120-L), Net Income (Loss) Reconciliation for U.S.
Life Insurance Companies With Total Assets of $10 Million or More
o Form 1120-PC, U.S. Property and Casualty Insurance Company
o Schedule M-3 (Form 1120-PC), Net Income (Loss) Reconciliation for

U.S. Property and Casualty Insurance Companies With Total Assets of
$10 Million or More
o 5884-A, Hurricane Katrina Employee Retention Credit
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o Form 8906, Distilled Spirits Credit
o Form 8907, Nonconventional Fuel Source Credit
o Form 8908, Energy Efficient Home Credit
o Form 8909, Energy Efficient Appliance Credit
o Form 8910, Alternative Motor Fuel Credit
o Form 8911, Alternative Fuel Vehicle Refueling Credit
o Form 8912, Clean Renewable Energy Bond Credit
o Form 8913, Credit for Federal Telephone Excise Tax Paid (Note: if the
tax return is only being filed to claim the TETR credit, do not e-file the
return. Send the paper return to the appropriate IRS Submission
Processing Center.)
o Form 8916, Reconciliation of Schedule M-3 Taxable Income with Tax

Return Taxable Income for Mixed Groups
o Form 8916-A, Reconciliation of Cost of Goods Sold Reported on

Schedule M-3
o Form 8886 is being revised and will not be available for e-filing until a
later date. Once the revision is posted on the IRS.GOV webpage the
IRS will accept the form as a pdf attachment to the electronic return.
XML schemas were developed and issued for the following new forms that can
be attached to the 1065/1065-B return:
o Schedule K-1 (1065), Partner’s Share of Income, Deductions, Credits,

etc.
o Schedule K-1 (1065-B), Partner’s Share of Income (Loss) from Electing

Large Partnership.
o Schedule D (1065), Capital Gains and Losses.
o Schedule M-3 (1065/1065-B), Net Income (Loss) Reconciliation for

Certain Partnerships.
o Schedule N Form 5471, Return of Officers, Directors, and 10% or more

Shareholders of a Foreign Personnel Holding Company.
o Form 8308, Report of a Sale or Exchange of Certain Partnership

Interests.
o Form 8909, Energy Efficient Appliance Credit.
o Form 8913, Credit for Federal Telephone Excise Tax Paid.
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o Form 8916-A, Reconciliation of Cost of Goods Sold Reported of
Schedule M-3
o Form 8886 is being revised and will not be available for e-filing until a
later date. Once the revision is posted on the IRS.GOV webpage the
IRS will accept the form as a pdf attachment to the electronic return.
XML Schemas were developed and issued for the following new Forms:
o Form 2290, Heavy Highway Vehicle Use Tax Return
o Form 720, Quarterly Federal Excise Tax Return
o Form 8849, Claim for Refund of Excise Tax,
The following forms are no longer accepted through the Modernized e-File
system:
Form 5735
Schedule P (Form 5735)
Form 8830
Form 8895
Form 5712-A
IRS Counsel reviewed Regulations to identify elections that require a signature to

determine if the requirements can be changed. IRS published the results to this
review on the Large and Mid-Size Businesses web page at
http://www.irs.gov/businesses/corporations/article/0,,id=146959,00.html. Elections
that require a separate signature may be submitted in PDF format.
The Tax Relief and Health Care Act of 2006
The Tax Relief and Health Care Act was signed by the President on December 20,
2006. As a result of the late enactment, the implementation of many of the changes in
the Modernized e-File (MeF) schemas cannot occur until processing year 2008. The
following Form specific procedures should be followed by taxpayers e-fling returns on
the MeF system.
Form 5735 - American Samoa Economic Development Credit

• The Act provides that a domestic corporation that is an existing credit claimant
with respect to American Samoa and that elected the application of IRC § 936 for
its last taxable year beginning before January 1, 2006 is allowed, for two taxable
years, a credit based on the economic activity-based limitation rules. The credit is
computed based on the rules of §§ 30A and 936.
o The amount of the credit allowed to a qualifying domestic corporation
under the provision is equal to the sum of the amounts used in computing
the corporation’s economic activity-based limitation with respect to
21
American Samoa, except that no credit is allowed for the amount of any
American Samoa income taxes.
o Thus, for any qualifying corporation the amount of the credit equals the
sum of (1) 60% of the corporation’s qualified American Samoa wages and
allocable employee fringe benefit expenses and (2) 15% of the
corporation’s depreciation allowances with respect to shortlife qualified
American Samoa tangible property, plus 40% of the corporation’s
depreciation allowances with respect to medium-life qualified American
Samoa tangible property, plus 65% of the corporation’s depreciation
allowances with respect to long-life qualified American Samoa tangible
property.
o The current § 936(c) rule denying a credit or deduction for any
possessions or foreign tax paid with respect to taxable income taken into
account in computing the credit under § 936 does not apply with respect to
the credit allowed by the provision.
• This provision is effective for the first two taxable years of a corporation which
begin after December 31, 2005, and before January 1, 2008.
• Form 5735 will be accepted in PDF for 2006 tax year claimants.
Other Forms affected by Form 5735:

The American Samoa Economic Development Credit is used to determine the allowable
amount for several other credits. For these forms, the American Samoa Economic
Development credit amount will be included on the same line as the Qualified Electric
Vehicle Credit. It will be identified on paper returns with a write-in explanation.
• For e-filed returns, the American Samoa Economic Development Credit amount
will be included as part of the total on the applicable form on the same line
(identified below).
• The “write-in” will be identified on MeF returns by using the GeneralDependency
Schema. The “write-in” explanation on this schema must be described as Form
8835 Credit Amount and should be referenced from the form’s line where it was
included. Write-in explanation should say - : “American Samoa Economic
Development Credit amount included of $XX”
• Form 1120 – U. S. Corporation Income Tax Return - Sch J, Line 5b
• Form 8835 – Renewable Electricity, Refined Coal, and Indian Coal Production
Credit –Part II, Line 36c
• Form 8844 - Empowerment Zone Employment Credit - Part II, Line 16c
• Form 8860 - Qualified Zone Academy Bond Credit - Part II, Line 7c
Form 8907 - Nonconventional Source Fuel Credit

• No schema change for 2006
• 2006 – Part I, Line 4a and 4c MUST BE ZERO. Software Developers should
either embed zeros in these lines or not enable them in the software.
• 2005 Form is accepted in PDF but Part 1, Line 4b MUST BE ZERO.
Form 8923 – Mine Rescue Team Training Tax Credit (New form)
This form will be accepted in PDF for 2006 tax returns.
• PDF must be named and described - Form 8923 Mine Rescue Team Training
Credit
22
• Form must be attached to the top level tax return, if the return is a consolidated
return, it must be attached at the consolidated level.
Exclusion of 25% of Capital Gain for Certain Sales of Mineral and Oil Leases for
Conservation Purposes
The Act provides a 25% exclusion from gross income of long-term capital gain from the
conservation sale of a qualifying mineral or geothermal interest. The amount of this
exclusion should be identified on the Schedule D as TRHC - 403(c).
Amended and Superseding Corporate Returns
On February 14, 2007, the MeF system will process both superseding and amended
returns. Amended and superseding returns for Form 1120 and 1120S will be taken for
the 2005 tax year and forward. Beginning with 2006 returns - both amended and
superseding returns will be required to be e-filed if the taxpayer is required to file
electronically based on the temporary regulation unless a taxpayer has received an
approved waiver to file that particular return in paper. All of the business rules for e-filing
original returns will also be enforced for both superseding returns and amended returns.
Software developers who intend to support the new superseding and amended return
functionality for 2005 must update their products to use the Form 1120 version 2.6
schemas. Taxpayers and prepares needing to file a 2005 superseding or amended
return should discuss the availability of this functionality with their software developer.
Superseding Returns
A subsequent return filed within the filing period (including extensions) is
considered a superseding return. A superseding return is considered the original filing
because it takes the place of any other return previously filed during the filing period,
with extensions.
A superseding return must be a complete XML filing of the whole return, with all
required forms, schedules and attachments (XML or PDF, if applicable). A
taxpayer filing a superseding return must indicate the return is such by selecting the
Superseded Return checkbox (designation) in the software or the return will reject as a
duplicate filing. All of the business rules for e-filing original returns will be enforced for
superseding returns.
Amended Returns
A subsequent return filed after the expiration of the filing period (including valid
extensions) is considered an amended return. A taxpayer filing an amended return
must indicate the return is such by selecting the Amended Return checkbox
(designation) in the software or the return will reject as a duplicate filing.
The IRS Amended Return process requires that any e-filed return designated as an
Amended Return pass all of the same business rules as an original e-filed business
return. Most
23
taxpayers e-filing amended returns will have already e-filed their underlying tax return,
therefore the easiest process for e- filing the Amended Return will be to update the
underlying original for the changed items. Once the return has been updated with the
changes, attach the required PDF Form 1120X or Changes in Amended Return
document (see below) and any other supporting explanations and refile the complete
new return, ensuring that the Amended Return checkbox is selected.
For taxpayers who e-filed original returns with voluminous PDF and/or who filed hybrid
returns that used the paper or PDF option, some of the PDF/Paper information may not
need to be refiled with the Amended return if the changes do not affect the information
contained in those files (e.g. PDF elections, PDF Forms 1120-L or 1120-PC subsidiary
returns, paper/PDF Forms 5471, 8858, 8865, etc.)
ended returns will require, at a minimum,
1. The corrected Form 1120 or 1120S completed in its entirety with the Amended
Return checkbox selected.
2. All forms, schedules and attachments that changed or that support changes on
the amended Form 1120/Form 1120S, including any subsidiary returns (if
changed) and the information to support those changes.
3. Placeholder forms to pass any applicable business rules (i.e. 5471, 8858, 8865,
etc.) where there is no change to the underlying data on that form. If the
underlying data has changed, the corrected form must be attached
4. One of the Following:
a. For Form 1120 - A PDF Form 1120X completed through Part I, line 10 or
11, as applicable, and Part II with the line number of each amended item,
the corrected amount or treatment of the item, and an explanation of the
reasons for each change. The PDF Form 1120X must be named
Form1120X.PDF and described as Form 1120X. It must be attached to
the top level 1120 return or the consolidated return, if applicable.
Additional PDF explanations should be named
Form1120XExplanationN.PDF – where N is the number of the file, if more
than one is required. Each additional PDF attached filed should be
described as 1120X Explanation Z, again where Z is the number of the
file.
OR
b. For Form 1120/Form 1120S – A PDF statement that identifies the line
number of each amended item, the corrected amount or treatment of the
item, and an explanation of the reasons for each change. The PDF
should be attached to the top level returns (if this is a consolidated 1120,
then it must be attached to the consolidated return). The PDF file must be
named ChangesInAmendedReturn.PDF and described as Changes in
Amended Return.
5. A signed signature document (Form 8453-C/S), as applicable or use of a
Practitioner’s Pin.
6. Appropriate forms to make a payment, request a refund or request a credit
carryover to another year.
24
Return/Extension Due Date Charts
Due date charts for all form types can be found in sections pertaining to a specific form
type in this publication.
______________________________________________________________________
Returns Not Eligible for MeF
Returns and extensions meeting the conditions below cannot currently be filed
electronically. (Note: Paper documents can be scanned and attached to electronic
returns, but no paper documents may be mailed to the IRS.)
For Forms 1120/1120-S:

The Tax Year 2006 Corporate e-file Program does not accept and process the following
corporate returns. Therefore, the corporation is excluded from the electronic filing
requirement under Temporary Treasury Regulation Section 301.6011-5T unless
otherwise noted.
Returns with tax periods ending prior to December 2004
Returns covering multiple tax periods
Bank Holding Company Tax Act. Election to make installment payments for a portion
of the total tax attributable to the Bank Holding Company Tax Act.
Prompt Assessments
Returns with reasonable cause as related to failing to pay and/or file timely. Note:
Corporations required to e-file under Temporary Treasury Regulation Section
301.6011-5T are still required to file electronically. In order to comply with the
mandatory e-file regulations, corporations must send the explanation of reasonable
cause as a separate letter to Internal Revenue Service, ARKA Monterrey Park,
1973 N. Rulon White Blvd., Mail Stop 6552 (ARKA) - Attn: AM Clerical, Ogden, Utah
84404. These procedures do not apply to Form 2220 which should be filed as part
of the electronic return.
Returns with pre-computed penalty and interest. Note: Corporations required to e-

file under Temporary Treasury Regulation Section 301.6011-5T are still required to
file electronically. In order to comply with the mandatory e-file regulations,
corporations must send the explanation of pre-computed penalty and interest as a
separate letter to Internal Revenue Service, ARKA Monterrey Park, 1973 N. Rulon
White Blvd., Mail Stop 6552 (ARKA) - Attn: AM Clerical, Ogden, Utah 84404.
Requests for overpayments to be applied to another account. Note: Corporations

required to e-file under Temporary Treasury Regulation Section 301.6011-5T are still
required to file electronically. In order to comply with the mandatory e-file
regulations, corporations must send the request to apply overpayments as a
25
separate letter to Internal Revenue Service, ARKA Monterrey Park, 1973 N. Rulon
White Blvd., Mail Stop 6552 (ARKA) - Attn: AM Clerical, Ogden, Utah 84404.
The following forms cannot be filed electronically as a return.
1120-C (formerly 990-C) Farmer's Cooperative Association

1120H Homeowners Association
1120F Foreign Corporation
1120FSC Foreign Sales Corporations
*1120-L Life Insurance Company
1120RIC Regulated Investment Companies
1120REIT Real Estate Investment Trust
*1120-PC Property and Casualty
1120-SF Settlement Funds
1120ND Nuclear Decommission Trusts
* Forms 1120L and 1120PC cannot be filed as standalone returns.

They cannot be attached at the top level of the corporate return.
They must be filed at the consolidated level .
For Form 7004:
Name change applications

Reasonable cause for failing to pay timely
Reasonable cause for failing to file application timely
Requests for refunds
Election to make installment payments for a portion of balance due amount
Applications requesting extension due to change in accounting period unless prior
approval has been applied for from IRS or certain conditions have been met. See
Publication 538, Accounting Periods and Methods, for details.
Applications with Net Operating Loss Carryback. Form 1138 should be sent
separately, not with the application.
Applications attaching a Power of Attorney (POA). POA should be sent separately,
not with the application.
Early filed returns (filed before end of tax period)
See the 7004 Due Date Charts to determine which returns are eligible to file an
extension
Any condition or requirement, not supported by software, that requires the
submission of a paper document or form (Exception – corporation filing under
Temporary Treasury Regulation Section 301.6011-5T)
Filing short period extension due to termination of 1120-S status.
For Form 706-GS(D)
For Form 8612
For Form 8613
For Form 8725
For Form 8831
26
For Forms 990 & 990-EZ:
Returns from organizations not recognized as exempt (application pending, etc.)
Returns from organizations desribed in section 501(c)(28)
Name change returns
Returns showing a change in accounting period
Short period returns (exception: short period final returns)
Early filed returns (filed before end of tax year except for final returns)
Returns with non-IRS forms attached such as Form LM-2 or LM-3 (Dept. of Labor)
Organizations such as churches and government agencies that are excluded from
the filing requirement pursuant to Reg. 1.6033-2(g); Exception: domestic
organizations excluded from filing solely because their gross receipts are normally
less than $25,000 may file electronically if they choose.
For Form 990-PF:
Returns from organizations not recognized as exempt (application for exemption
pending, etc.)
Foreign private foundations
Name change returns
"Limited" 990-PFs, i.e., "Limited" 990-PFs are filed by organizations that originally
received advance rulings as public charities but were later determined to be private
foundations
507(b)(1)(A) terminations
Foundations in 60-month terminations
For 1120-POL:
Short period returns (except for short period final returns)
Name change returns
Returns with non-numbered attachments/schedules (unless allowed for an attached
form shared with Forms 1120/1120-S) for which an IRS format has not been
developed
For Form 8868:
Extensions from organizations not recognized as exempt (application pending, etc.)

Extensions other than the automatic extension (Part I)
Extensions for short period returns
Extensions for the following forms:
o Form 990-BL
o Form 6069
o Form 8870
Extensions for group returns
Extensions for composite Forms 990-T
Extensions for consolidated Forms 990-T
27
For Form 1065/1065-B:
• Returns with tax periods ending in December 2005 and prior

• Returns filed for religious or apostolic organizations under section 501(d) or for
organizations electing not to be treated as a partnership under section 761(a)
• Returns transmitted by a person not approved by the IRS for electronic filing
• Returns with Powers of Attorney (POA) attached and the IRS does not have a
POA file
• Returns file under Sections 6020)bz, 501(d)(3) or 761(a) of the Internal Revenue
Code
• Returns for inactive partnerships with no income on pages 1, 2, 3 and 4 of Form
1065
• Common Trust Fund Returns
____________________________________________________________________
MeF Fed/State Program
MeF implemented the 990 and 1120 Fed/State Programs in January of 2006 and in
January 2007 Fed/State was implemented for the 1065/1065-B Partnership Returns
MeF Program. Several states successfully participated in the program were able to
retrieve state returns from the IRS. The central feature is the single point of submission
and retrieval for all registered transmitters and State agencies. Federal submissions
can be transmitted to the IRS through EMS, MeF Internet Filing Application (IFA) or
Application-to-Application (A2A). State submissions can only be transmitted through
the IFA and A2A channels.
MeF will accept two kinds of submissions (1) IRS (federal) submissions and (2) State
submissions. Each return/extension must be enclosed in a separate submission, but
multiple submissions may be contained in a single message. The IRS and State
submissions do not have to be transmitted to MeF together. A State submission can be
linked to the IRS submission by including the Submission ID of the federal return in the
State manifest. If the State submission is linked to an IRS submission (also referred to
as a Fed/State return), the IRS will check to see if there is an accepted IRS submission
under that Submission ID. If there is not an accepted federal return, the IRS will deny
the State submission and an acknowledgement will be sent to the transmitter. (NOTE:
There is no information on this state return provided to the state. The state will not
know that the IRS received this state return.) If there is an accepted return under that
Submission ID, then MeF will do minimal validation on the State submission that
includes that the State indicated in the State manifest is a participating state in the
applicable 990, 1065 or 1120 Fed/State Program. MeF will then pass along to the State
the entire State submission that was sent in by the ERO/taxpayer in the State
submission. If the ERO does not link the State return to a previously accepted federal
return (also referred to as State Standalone return), then MeF will perform minimal
validation as stated above that will include that the State allows State Standalone
returns and then will pass along to the State the entire State submission that was sent
28
in by the ERO/taxpayer. Note: The state return is made up of a state and a federal
portion. The taxpayer provides both components based on what is required by the
state. The IRS passes to the state just the information that has been provided by the
taxpayer.
In addition, for Forms 990/990-EZ/990-PF, as part of the IRS return, a filer can request
that a copy of the IRS return be provided to one or more participating States. Upon
receipt of the request, IRS will validate that the State(s) is participating in the Fed/State
program. If it is, then IRS will send a redacted copy of the return to the State agency(s).
Items that are always redacted from the state copy include, but are not limited to, the
PIN or Form 8453-EO, the request for the copy and any payment information included
with Form 990-PF. In addition, depending on the state, the IRS may also redact the
Schedule B if the state does not require it. MeF will process the IRS submission and
will generate an acknowledgement for every IRS submission and copy of IRS Forms
990/990-EZ/990-PF forwarded to a State. Each State is responsible for validating their
State submissions and will be responsible for generating a State acknowledgement for
each State submission which will be returned to the IRS for retrieval by the transmitter.
Both Federal and State returns must be in XML format, with optional PDF, when
allowed by the state.. The federal returns must conform to the IRS valid schema
versions. State returns must conform to the corporate State Master Schema and
include those elements defined for the specific state data. You can access the corporate
State Master Schema at: http://www.statemef.com. For more information, you can
contact the State e-file Coordinator. You can access a current list of State Coordinators
on irs.gov at: http://www.irs.gov/efile/article/0,,id=97558,00.html.
29
____________________________________________________
Part III
Rules and Requirements
For
Modernized e-file Providers
______________________________________________________________________
30
______________________________________________________________________
General
All Authorized IRS e-file Providers must adhere to IRS e-file rules and requirements to
continue participation in IRS e-file. Requirements are included in Revenue Procedure
2000-31, throughout this publication, and in other publications and notices that govern
IRS e-file (See Publication 3112, IRS e-file Application and Participation). Adherence to
all rules and requirements is expected of all Providers regardless of where published.
Some rules and requirements are specific to the activities performed by the Provider
and are included in appropriate chapters of this publication. The following list, while not
all-inclusive, applies to all Authorized IRS e-file Providers of Corporate Income Tax
Returns, Exempt Organization Returns, Partnership Returns except Software
Developers that do not engage in any other IRS e-file activity other than software
development. A Provider must:
Maintain an acceptable cumulative error or reject rate;
Adhere to the requirements for ensuring that tax returns are properly signed and
when applicable, provide legible and complete declarations;
Include the ERO’s EFIN as the return EFIN for returns the ERO submits to an
Intermediate Service Provider or Transmitter;
Include the Intermediate Service Provider’s EFIN in the designated Intermediate

Service Provider field in the electronic return record;
Submit an electronic return to the IRS with information that is identical to the
information provided to the taxpayer and when applicable, the declaration;
______________________________________________________________________
Protecting Taxpayer Information
Gramm Leach Bliley Act (GLBA) of 1999 & Federal Trade Commission Rules
Federal Trade Commission (FTC) states that Financial institutions include businesses
that are “significantly engaged” in providing financial products or services to customers.
This includes tax preparers, data processors, mortgage brokers, check-cashing
businesses, non-bank lenders, personal property or real estate appraisers, courier
services, and retailers that issue credit cards to consumers. It also applies to
companies that receive information from financial institutions or share information with
other financial institutions about their customers. It also pertains to their affiliates and
services providers.
If you are a preparer, collector, intermediate service provider, data processor, or

transmitter of nonpublic personal tax and financial information, you are considered a
financial institution. Tax Preparation Service is defined in 16 CFR 313.3.
31
FTC enacted two rules pursuant to the GLBA: Privacy Rule and Safeguards Rule,
effective May 23, 2003.
• Businesses must provide their customers with a privacy policy statement

in addition to providing privacy of customer information. Notices must be
written, either on paper or on a screen display.
• Businesses must also safeguard all customer information, which is defined

as nonpublic personal information about their own customers or
information received from a financial institution about the customers of
another financial institution.
• This includes information handled by affiliates and service providers.
Visit the FTC website www.ftc.gov for documents, guidance, and useful information
about your responsibilities.
______________________________________________________________________
Safeguarding of Modernized e-File From Fraud and Abuse
Safeguarding MeF from fraud and abuse is the shared responsibility of the IRS and
Authorized IRS e-file Providers. Authorized IRS e-file Providers must be diligent in
recognizing and preventing fraud and abuse in IRS e-file. Neither the IRS nor Providers
benefit when fraud or allegations of abuse tarnish the integrity and reputation of IRS
MeF. Providers appoint an individual of a business as a Responsible Official who is
responsible for ensuring the firm meets IRS e-file rules and requirements. Providers
with problems involving fraud and abuse may be suspended or expelled from the IRS e-
file program, be assessed civil and preparer penalties or be subject to legal action.
Any time you observe or become aware of suspicious activity, report it to the IRS
by calling 1-800-829-0433 (toll-free).
To learn more about what the Internal Revenue Service has done to maintain integrity
of its systems go to this link: http://www.irs.gov//efile/article/0,,id=146388,00.html/
32
______________________________________________________________________
Returns Filed Through Modernized e-File
A “return” filed through Modernized e-File is a composite of electronically transmitted

data. If a taxpayer is required to file a document that requires an original signature, IRS
regulations have eliminated the obligation to mail the original document to the IRS.
Instead, the original document should be scanned and transmitted with the return, but
the original paper documents must be retained by the originator/taxpayer. More
information on this regulations can be found at this link
http://www.irs.gov/newsroom/article/0,,id=157721,00.html
IRS Eases Reporting Burden on Corporations and Shareholders (May 26, 2006)
The Internal Revenue Service has announced new regulatory revisions that will reduce
the reporting burden on corporations and shareholders while also making it easier for
them to file their tax returns electronically.
• Revenue Procedure 2006-21
• REG-134317-05
• TD 9264
Responsible Officials
A Responsible Official is an individual who is responsible for the corporation’s e-file

operation. A Responsible Official may be a Principal of the Firm or Corporate Officer, or
these responsibilities may be delegated at the corporation's discretion. The
Responsible Official is the first point of contact with the IRS and has the authority to sign
revised IRS e-file applications. The Responsible Official ensures that the corporation
adheres to the provisions of all publications and notices governing IRS e-file. If one
individual cannot fulfill these responsibilities, additional Responsible Officials may be
identified. The IRS strongly recommends that the company list more than one person
on their e-file application. Also, it is recommended that a company submit application
updates as changes are made because if contact is attempted and the contact on the
application is no longer available, the IRS can disable that account until the information
is updated. To add or change Responsible Officials, the IRS e-file Application must be
revised.
For Large Taxpayers please review the “IRS e-file for Large Taxpayers Filing Their Own
Corporate Income Tax Return, Rev. 02/2006 (pdf) and Exempt Entities should refer to
IRS e-file For Large Tax Exempt Entities Filing their Information Returns.
33
Delegated Users
A Delegated User is an individual within a firm/organization, other than a Responsible

Official, who is authorized to use one or more of the e-Services products. A
Responsible Official appoints an individual as a Delegated User on the IRS e-file
Application. A Delegated User should be an employee, partner, or other member of the
firm/organization or have a business relationship with the firm/organization. A
Delegated User may be authorized by a Responsible Official with one or all of the
following authorities:
Viewing, updating, signing, and submitting IRS e-file Applications;

Accessing e-Services incentive products (Disclosure Authorization, Electronic
Account Resolution and Transcript Delivery System);
Transmitting Forms through the Internet (Internet Transmitter);
Requesting a new password (Security Manager).
Enrolling a system for Application-to-Application communication (MeF System
Enroller)
The actions of the Delegated User are the responsibility of the Responsible Official who
appoints the individual.
It is important that Responsible Officials and/or Delegated Users and their

authorities be deleted from the IRS e-file Application when they are no longer
associated with the Taxpayer or when their position within the firm no longer
warrants one or more authorities.
Reporting Changes
A Responsible Official or a Delegated User authorized to revise an IRS e-file Application

should ensure that the IRS has current information. All required changes can be made
by updating your IRS e-file Application at:
http://www.irs.gov//efile/article/0,,id=98246,00.html/
The Application must be revised within thirty days of a change of any information on the
current application. This is important for several reasons. If the IRS does not have
current addresses, important letters, credentials, publications, or other materials may
not be received. If any of these items are returned to the IRS indicating that the
address has changed, the Electronic Return Originator will be temporarily removed
from participation in IRS e-file. This means that all returns submitted after that time will
be rejected until the address information is updated. The same is true for telephone
numbers. If the IRS tries to call a number that has changed or has been disconnected,
the Electronic Return Originator will be temporarily removed from participation in IRS e-
file until new telephone numbers are provided.
Note: Changes submitted on an IRS e-file Application will not update the address of
record for tax return records nor will a change to tax return records automatically update
information associated with your EFIN.
34
______________________________________________________________________
Submitting a Timely Filed Electronic Tax Return
All prescribed due dates for filing paper income tax returns apply to electronic returns.
All Authorized IRS e-file Providers must ensure that returns are promptly processed.
However, a Provider that receives a return for electronic filing on or before the due date
of the return must ensure that the electronic portion of the return is transmitted on or
before that due date (including extensions). An electronically filed return is not
considered filed until the electronic portion of the tax return has been acknowledged by
the IRS as accepted for processing. However, if the electronic portion of a composite
return is successfully transmitted on or shortly before the due date, the return will be
considered timely filed. If the electronic portion of a return is transmitted on or shortly
before the due date and is ultimately rejected, but the Provider and the taxpayer comply
with the requirements for timely resubmission of a corrected return, the return will be
considered timely filed (see Transmission Perfection Period for Returns). For
additional information about the filing of a return through Modernized e-File, see The
Procedures for Electronic Return Originators of MeF Returns in Part IV of this
publication.
Transmitters may provide electronic postmarks to taxpayers if the Transmitters adhere

to the requirements in Part V of this publication. The receipt of an electronic postmark
will provide taxpayers with confidence that they have filed their return timely. The date
of the electronic postmark is considered the date of filing when the date of electronic
postmark is on or before the prescribed due date and the return is received by the IRS
after the prescribed due date for filing. All requirements for signing the return and
completing the declaration as well as resubmitting a rejected timely filed return must be
adhered to for the electronic postmark to be considered the date of filing.
Disclosure of Tax Return Information
Under §301.7216, disclosure of tax return information among Authorized IRS e-file
Providers for the purpose of preparing a tax return is permissible. For example an
Electronic Return Originator (ERO) may pass on tax return information to an
Intermediate Service Provider and/or a Transmitter for the purpose of having an
electronic return formatted and transmitted to the IRS. However, if the tax return
information is disclosed or used in any other way, an Intermediate Service Provider
and/or a Transmitter may be subject to the penalties described in §301-7216 and/or the
civil penalties in §6713 for unauthorized disclosure or use of tax return information.
35
Preparer Penalties
Preparer penalties may be asserted against an individual or firm meeting the definition
of an income tax preparer under §7701(a)(36) and §301.7701-15. Preparer penalties
that may be asserted under appropriate circumstances include, but are not limited to,
those set forth in §§6694, 6695, and 6713.
Under §301.7701-15(d), Authorized IRS e-file Providers are not income tax return
preparers for the purpose of assessing most preparer penalties as long as their services
are limited to “typing, reproduction, or other mechanical assistance in the preparation of
a return or claim for refund”. If an ERO, Intermediate Service Provider, Transmitter, or
the product of a Software Developer alters the return information in a nonsubstantive
way, this alteration will be considered to come under the “mechanical assistance”
exception described in §301.7701-15(d). A nonsubstantive change is a correction or
change limited to a transposition error, misplaced entry, spelling error, or arithmetic
correction.
If an ERO, Intermediate Service Provider, Transmitter, or the product of a Software

Developer alters the return in a way that does not come under the “mechanical
assistance” exception, the Authorized IRS e-file Provider may be held liable for income
tax return preparer penalties. See §301.7701-15; Rev. Rul. 85-189, 1985-2 C.B. 341
(which describes a situation where the Software Developer was determined to be an
income tax return preparer and subject to certain preparer penalties).
In addition to the above specified provisions, the IRS reserves the right to assert all
appropriate preparer and nonpreparer penalties against an Authorized IRS e-file
Provider as warranted.
Suspensions
For all rules for eligibility to reapply for participation in IRS e-file after being previously
denied or suspended from participation in IRS e-file refer to the Publication 3112.
Advertising Standards
In addition to the advertising standards common to all Authorized IRS e-file Providers
detailed in Publication 3112, IRS e-file Application and Participation, there are additional
responsibilities for Providers e-filing Corporate Income Tax Returns.
Providers must not use improper or misleading advertising in relation to IRS e-file. Any
claims by Providers concerning faster refunds by virtue of electronic filing must be
consistent with the language in official IRS publications.
In using the Direct Deposit name and logo in advertisement, the Provider must use the
name “Direct Deposit” with initial capital letters or all capital letters; the Provider will use
36
the logo/graphic for Direct Deposit whenever feasible; and the Provider may change the
color or size of the Direct Deposit logo/graphic when it is used in advertising pieces.
Paperwork Reduction Act Notice
The collections of information contained in this publication have been reviewed and
approved by the Office of Management and Budget in accordance with the Paperwork
Reduction Act (44 U.S.C. 3507) under control number 1545-1708.
An agency may not conduct or sponsor, and a person is not required to respond to, a
collection of information unless the collection of information displays a valid control
number. Books or records relating to a collection of information must be retained as
long as their contents may become material in the administration of any internal
revenue law. Generally, tax returns and tax return information are confidential, as
required by 26 U.S.C. § 6103.
This information is required to implement IRS e-file and to enable taxpayers to file their
corporate income tax returns electronically. The information will be used to ensure that
taxpayers receive accurate and essential information regarding the filing of their
electronic returns and to identify the persons involved in the filing of electronic returns.
The collections of information are required to retain the benefit of participating in IRS
e-file. The likely respondents are business or other for-profit institutions.
_____________________________________________________________________
Obtaining, Handling, and Processing Return Information from Taxpayers
An ERO originates the electronic submission of returns it either prepares or collects

from taxpayers wishing to have their returns e-filed. The ERO must always identify the
paid preparer (if any) in the appropriate field of the electronic record of returns it
originates. EROs may either transmit returns directly to the IRS or arrange with another
Provider to transmit the electronic return to the IRS. An Authorized IRS e-file Provider,
including an ERO, may disclose tax return information to other Providers for the
purpose of preparing a tax return under Section 301.7216. For example, an ERO may
pass on return information to an Intermediate Service Provider or a Transmitter for the
purpose of having an electronic return formatted or transmitted to the IRS.
An ERO that chooses to originate returns that it has not prepared, but only collected,
becomes the tax return preparer of the returns when, as a result of entering the data, it
discovers errors that require substantive changes and then makes the changes. A
nonsubstantive change is a correction limited to a transposition error, misplaced entry,
spelling error, or arithmetic correction. All other changes are considered substantive
and the ERO becomes the return preparer. As such, the ERO may be required to sign
the tax return as the income tax return preparer.
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______________________________________________________________________
Safeguarding Modernized e-File From Fraud and Abuse
While all Authorized IRS e-file Providers must be on the lookout for fraud and abuse in
IRS e-file, EROs must be particularly diligent while acting in their capacity as the first
contact with taxpayers filing a return. An ERO should always seek to recognize and
prevent fraud and abuse of IRS e-file. A potentially abusive return is a return that is not
fraudulent, is required to be filed by the taxpayer, but contains inaccurate information
that may lead to an understatement of a liability or the overstatement of a credit
resulting in a refund to which the taxpayer may not be entitled.
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______________________________________________________________________
Part IV
Procedures For
Electronic Return
Originators
of
MeF Returns
______________________________________________________________________
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_____________________________________________________________________
Be Careful With Addresses
EROs should inform taxpayers that the address on the first page of the return, once
processed by the IRS, will be used to update the taxpayer’s address of record. The IRS
uses a taxpayer’s address-of-record for various notices that are required to be sent to a
taxpayer’s “last known address” under the Internal Revenue Code and for refunds of
overpayments of tax (unless otherwise specifically directed by taxpayers, such as by
Direct Deposit).
Finally, an ERO’s address must never be put in fields reserved for taxpayers’ addresses
in the electronic return record or on signature documents such as; Form 8453-C, 8453-
S, 8453-PE, 8453-B, 8453-EO. The only exceptions are if the ERO is the taxpayer or
the address of a power of attorney for the taxpayer for the tax return is the same as the
address of the ERO.
Foreign Address
Returns/extensions (except for Form 990-PF) with a foreign address in the entity portion
of the electronic return may be filed electronically.
There will be instances in the preparation of the returns, forms or attachments when the
preparer is directed to enter the two character Foreign Country Code. This code should
always be the code of the Foreign Country or Foreign Sovereignty as recognized by the
US State Department. For example; Scotland, Wales, and England are part of the
foreign country United Kingdom. The Foreign Country Code for United Kingdom is UK.
As well, the Balearic Islands are a part of Spain and should be coded as Spain, “SP”.
These are just a few examples. When entering foreign addresses in the return or forms,
the state or republic (such as Scotland or England) can be entered with the city;
“London, England” and the country as “United Kingdom” or “UK”. (See Exhibit 3 for a
list of the Foreign Country Codes)
If a two digit country code is not listed, the code “XX” should be used. A common
mistake that was made in prior years was when a taxpayer entered the foreign country
name instead of a code. Do not enter a foreign country name because this will cause
your return to reject.
Address Changes
Domestic Address
MeF will accept all domestic address changes as shown by the taxpayer in the entity
portion of the parent return. All required fields must be included in order for an
address change to be made. The required fields are: Address Line 1, City, State
and Zip Code. IRS will update the taxpayer’s entity information with the change of
address.
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Foreign Address
MeF electronically filed Forms will accept changes to foreign addresses. The
required fields are: Address Line 1, and Country Code. IRS will update the
taxpayer’s entity information with the change of address.
Standard Street Address Abbreviations

Exhibit 4, Standard Street Address Abbreviations, is included in this publication. The
list is comprised of common abbreviations that are recognized by the U.S. Postal
Service.
Valid ZIP Codes

See Exhibit 5 for a complete list of valid ZIP Codes.
Name Controls
The Name Control for the filer should be determined from the information specified on
the first name line. Generally, the Name Control is derived from the first four characters
of the filer name and consists of up to four alpha and/or numeric, hyphen, and
ampersand characters. See Exhibit 1, Name Controls, for a complete list of rules for
creating Name Controls and examples to assist you in the preparation of the tax return.
Note: Noting the correct name control will avoid getting Business Rule Reject
Code 901.
NAICS Codes
A principal business activity and the associated code is designed to classify an

enterprise by the type of activity in which it is engaged to facilitate the administration of
the Internal Revenue Code. These principal business activity codes are based on the
North American Industry Classification System. In the case of a company that was
previously engaged in a trade or business, the NAICS code that was applicable when
there was activity should be used. In the case of a company that was not
previously engaged in a trade or business (a new company), the NAICS code that
corresponds to the intended trade or business should be used.
Exhibit 6 provides a list of the valid codes for Principal Business Activity Codes (NAICS
Codes).
______________________________________________________________________
Refund Returns
When taxpayers are entitled to refunds, Providers should inform taxpayers that they
have several options. A corporate income tax refund may be applied to next year’s
estimated tax; received as a Direct Deposit or paper check; or be split so that a portion
is applied to next year’s estimated tax and the rest received as Direct Deposit or paper
check.
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Some taxpayers elect the Direct Deposit option because it is the fastest way of
receiving refunds. Providers must accept any Direct Deposit election to any eligible
financial institution designated by the taxpayer. Refunds may be designated for Direct
Deposit to qualified accounts in the taxpayer’s name. Qualified accounts include
savings, checking, share draft, or consumer asset accounts (for example, IRA or money
market accounts). Refunds may not be designated for Direct Deposit to credit card
accounts. Qualified accounts must be held by financial institutions within the United
States. Qualifying institutions may be national banks, state banks (including the District
of Columbia and political sub-divisions of the 50 states), savings and loan associations,
mutual savings banks, and credit unions.
Check or share draft accounts that are “payable through” another institution may not
accept Direct Deposits. Taxpayers should verify their financial institution’s Direct
Deposit policy before they elect the Direct Deposit option.
Taxpayers who choose Direct Deposit must provide Providers with account numbers
and routing numbers for qualified accounts. This information is best obtained from
official financial institution records, account cards, checks or share drafts that contain
the taxpayer’s name and address.
Additionally, a Provider must never charge a separate fee for Direct Deposit and must
accept any Direct Deposit election by a taxpayer to any eligible financial institution. The
Provider must advise the taxpayer that a Direct Deposit election cannot be rescinded
and that changes cannot be made to routing numbers of financial institutions or to the
taxpayer’s account numbers after IRS has accepted the return. The Provider must not
alter the Direct Deposit information in the electronic record after a taxpayer has signed
the tax return.
Providers with repeat customers or clients should check to see if taxpayers have new
accounts. Some software stores last year’s information and reuses it unless it is
changed. Taxpayers will not receive Direct Deposit of their refunds if account
information is not updated to reflect current information.
Refunds that are not Direct Deposited because of institutional refusal, erroneous
account or routing numbers, closed accounts, bank mergers, or any other reason will be
issued as paper checks, resulting in refund delays of up to ten weeks. While the IRS will
ordinarily process a request for Direct Deposit, it reserves the right to issue a paper
check and does not guarantee a specific date by which the refund will be deposited into
the taxpayer’s account. Neither the IRS nor FMS is responsible for the misapplication of
a Direct Deposit that is caused by error, negligence, or malfeasance on the part of the
taxpayer, Authorized IRS e-file Provider, financial institution, or any of their agents.
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______________________________________________________________________
Balance Due Returns
Taxpayers who owe additional tax must pay their balances due by the original due date
of the return or be subject to interest and penalties. An extension of time to file may be
filed electronically by the original return due date, but it is an extension of time to file the
return, not an extension of time to pay a balance due. Providers should inform
taxpayers of their obligations and options for paying balances due. Taxpayers have
several choices when paying any taxes owed on their returns as well as estimated tax
payments.
______________________________________________________________________
Electronic Funds Withdrawal
The MeF Program will allow a taxpayer to pay the balance due on Form 1120/1120-
S/1120-POL/990-PF/1065/1065-B tax returns or the 7004/8868 extension forms by
authorizing an electronic funds withdrawal. If the taxpayer chooses this payment
method, they may authorize the entire payment (or a partial payment) be made at the
time that their tax return/extension form is electronically filed. Note: only the entire
payment can be made for the balance due on Form 8868/7004 unless otherwise stated
in the forms instructions.
The payment amount cannot be greater than the tax due on the electronic tax return or
form. The taxpayer must specify the bank account from which they wish to have the
payment withdrawn and the date on which the withdrawal will be made. This allows the
taxpayer to pay the balance due as soon as the tax return or form is accepted or
schedule the payment for withdrawal on a future date, not later than the return’s due
date. For returns transmitted after the due date, the payment date must be the same as
the date the return is transmitted. Domestic corporations must deposit all income tax
payments by using the Electronic Federal Tax Payment System (EFTPS) or with Form
8109, Federal Tax Deposit Coupon, by the due date of the return. If the corporation
expects to have a net operating loss carryback, the corporation can reduce the amount
to be deposited to the extent of the overpayment resulting from the carryback, provided
all other prior year tax liabilities have been fully paid and Form 1138, Extension of Time
for Payment of Taxes by a Corporation Expecting a Net Operating Loss Carryback, is
filed with Form 7004.
Form 7004 or Form 8868 does not extend the time to pay tax. If the entity is a
corporation or affiliated group of corporations filing a consolidated return, the
corporation must remit the amount of the unpaid tax liability shown on line 8 on or
before the due date of the return. If the entity is an exempt organization, it must remit
the unpaid tax liability shown on Form 8868, line 3c, on or before the due date of the
return. If you file Form 7004 or Form 8868 electronically, you can pay by Electronic
Funds Withdrawal (EFW). See Form 8878-A. A trust (Form 1041), electing large
partnership (Form 1065-B), or REMIC (Form 1066) will be granted an extension even if
it cannot pay the full amount shown on line 8. But it should pay as much as it can to limit
the amount of penalties and interest it will owe. If you are requesting an extension of
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time to file Form 1042, see the deposit rules in the instructions for the form to determine
how payment must be made.
If the electronic funds withdrawal (EFW) is authorized, an IRS Payment record must be
attached to the electronic return and an EFW consent statement must be signed.
Note to transmitters: the payment record can only be attached at the top level return
and any payment attached otherwise will not be processed. The following information is
required in the payment record:
Routing Transit Number

Bank Account Number
Account Type
Payment Amount
Requested payment Date
Taxpayer’s Daytime Phone Number
It is important to note that the following twenty day rule does not apply to payments:
If a submission was rejected on the due date, the return can be submitted within 20
days of the due date and not be considered late. In case the return is rejected on the
due date, it is recommended that the EFW payment not be transmitted with the return.
The balance due can be paid by EFTPS or check/money order See payment rules and
instructions at eftps.gov.
It is important to note that an ERO/Transmitter has 5 days to correct and resubmit a
rejected extension. The twenty day rule does not apply to extensions with payments.
If taxpayers do not provide all of the required information, providers must contact the
taxpayers. If the Provider is unsuccessful in obtaining the electronic funds withdrawal
information, but the returns are otherwise complete, the Provider should proceed with
the origination of the electronic return data to the IRS. The Provider must notify the
taxpayer in writing that other arrangements must be made to pay the balance due.
______________________________________________________________________
Credit Card Payments
In 2002 the IRS announced a policy decision to allow business e-filers to pay their
balance due by credit card. Although this payment option is not currently applicable for
any MeF-related software, the tax preparation software industry should contact the IRS
if they want to incorporate a credit card tax payment option in their MeF software for
Form 1120/1120-S/1120-POL, 1065/1065-B, 990-PF, 7004 and 8868 filers. The credit
card payment data (card number and expiration date) must be collected during the
return e-filing process and before the return is transmitted. The credit card tax payment
data is forwarded to the IRS separately from the return. Once the e-filed return is
accepted, the tax payment data will be forwarded to the IRS in an Electronic Data
Interchange (EDI) format.
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Below is a link to the technical specifications for integrating a credit card tax payment
option into a software product. Any software developer that wishes to offer an
integrated e-file and pay credit card option to business (or individual) e-filers may do so
non-competitively. Annual registration is required. While the IRS generally accepts
registration forms up to September of each year, to ensure that ample testing time is
scheduled, early registration is strongly encouraged.
http://www.irs.gov/pub/irs-
schema/2006_credit_card_bulk_provider_requirements_rev_2.0.doc
Payment Cancellation
To revoke or cancel any EFW payment, contact the U.S. Treasury Financial Agent, toll-
free, at 1-888-353-4537. Cancellation requests must be received no later than 8:00
p.m., Eastern Standard Time, at least two business days prior to the scheduled
payment date. If there is a change to the bank account information provided on the
return or form, call this number to cancel the scheduled payment. You may also call
this number to inquire about the status of an EFW payment. You can also call 1-800-
829-4933 ten (10) days after the requested payment date to confirm receipt of your
payment. When calling, please be ready to provide the Employer Identification Number,
the payment amount, and the bank account number.
______________________________________________________________________
Electronic Federal Tax Payment System (EFTPS)
Balances due and estimated taxes can be paid year round using the Electronic Federal
Tax Payment System (EFTPS). Taxpayers enroll in EFTPS-On-Line via an official
government site on the Internet, using a user-friendly Web interface. After enrollment,
taxpayers receive a confirmation package by mail with instructions. For more
information on electronic deposit options, visit http://www.irs.gov//efile/ and click on
“Electronic Federal Tax Payment System”.
If your return is rejected and the time to make a timely payment has lapsed and you
still need to make a payment, please make a Federal Tax Deposit through the
Electronic Federal Tax Payment System (EFTPS). If you are not enrolled in the EFTPS
you can complete and take Form 8109 Federal Tax Deposit Coupon with the payment
to an authorized depositary (i.e., a commercial bank or other financial institution
authorized to accept Federal Tax Deposits). All business taxpayers are authorized to
use EFTPS. If you would like to enroll in the EFTPS by phone you can call 800 316-
6541 or 800 945-8400, or visit the website at www.eftps.gov
Pay by Check
Balance due payments may be made by mailing a check. Payments do not have to be
mailed at the same time an electronic return is transmitted. For example, the return
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may be transmitted in January and the taxpayer may mail the payment and voucher at
any time on or before the return due date.
______________________________________________________________________
Signing an Electronic Return
As with any Income tax return submitted to the IRS on paper, an electronic income tax
return must be signed by an authorized officer and the paid preparer, if applicable. The
taxpayer must designate a principal of the firm responsible for signing the income tax
return following the procedures outlined in Treasury Regulation Section 1.6062-1. The
officer must sign and date the “Declaration of Taxpayer”.
The MeF system requires taxpayers and Electronic Return Originators (EROs) to use
one of the alternative signature options for signing electronic returns. The two available
options are the Practitioner PIN method and the Scanned Form 8453. MeF validates
that a signature exists for each return. If the taxpayer elects to sign a Form 8453, the
scanned 8453 must be attached to the return. (A paper copy of the Form 8453 should
NOT be sent to the IRS.) If the electronic return does not contain the required
signatures, it will be rejected.
______________________________________________________________________
Practitioner PIN Option
There are two components to the Practioner PIN method.
1) Taxpayer PIN --The taxpayer chooses the PIN that they wish to use to sign their
return. The Taxpayer’s PIN must be 5 numeric characters and cannot contain all
zeros.
2) Practitioner PIN --The ERO selects an eleven position PIN to sign the return. The
first 6 positions of the Practitioner PIN will be made up of the EFIN of the ERO and
the next 5 positions will be made up of 5 numeric characters that the ERO will select.
The Practitioner PIN option can only be used if the taxpayer uses an ERO. If the
signature option of “PIN Number” is chosen, the taxpayer and ERO will be required to
sign the return with a personal identification number (PIN). The Practitioner PIN
option consists of two PINs – one for the taxpayer and one for the Practitioner.
The Practioner PIN method cannot be used if a taxpayer is filing through an On-Line
Provider or is a Large Taxpayer (assets $10 million and greater).
The taxpayer must decide whether they want to enter their own PIN or whether they
authorize the ERO to enter the PIN they choose as their signature. This authorization is
made on Forms 8879-C for 1120, 8879-S for 1120-S, and 8879-EO for Exempt
Organizations, 8879-PE for 1065 and 8879-B for 1065-B. Pdf files of these forms can
be downloaded from the irs.gov website as follows:
46
Form 8879-C http://www.irs.gov/pub/irs-pdf/f8879c.pdf
Form 8879-S http://www.irs.gov/pub/irs-pdf/f8879s.pdf
Form 8879-EO http://www.irs.gov/pub/irs-pdf/f8879eo.pdf
Form 8879-PE http://www.irs.gov/pub/irs.pdf/8879pe.pdf
Form 8879-B http://www.irs.gov/pub/irs.pdf/8879B.pdf
The following fields are required for the Practitioner PIN method.
• Practitioner PIN
• PIN Entered By Indicator
• Name of Officer
• Title of Officer
• Taxpayer PIN
• Date Signed
Note: Failure to include any of the fields above will cause the return to reject.
ERO - The ERO must sign and complete the requested information in the “Declaration
of Electronic Return Originator (ERO) and Paid Preparer section after thoroughly
reading the declaration. An ERO may authorize members of its firm or designated
employees to sign for the ERO, but the ERO is still responsible for all electronically filed
returns originated by its firm. EROs do not have to disclose their EIN or SSN on the
copies they provide to taxpayers.
Paid Preparer - If the return was prepared for a fee, the paid preparer must also sign
the jurat. If the paid preparer is also the ERO, the preparer may check the “Also the
Paid Preparer” box and not complete the “Paid Preparer’s Use Only” section. Paid
Preparers do not have to disclose their SSNs or EINs on the copies they provide to
taxpayers.
EXTENSIONS -
Form 7004 - There is no signature requirement on the Form 7004, unless there
is a payment made with the Form 7004. The Practitioner PIN method is required
if a payment is attached to the Form 7004. Practitioner PIN is the only option
viable for signing extensions.
Form 8868 - Application for Extension of Time to File an Exempt Organization

Return, no longer requires a signature, unless there is a payment attached.
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__________________________________________________________
Scanned for 8453 Option
The alternative signature option that is available for Forms 1120, 1120-S, 1065, 1065B,
990, 990-EZ, 990-PF, 8868 and 1120-POL is the scanned Form 8453. The scanned
Form 8453 must be used if the taxpayer decides not to use or is prohibited from using
the Practitioner PIN option. If this option is chosen, the taxpayer and ERO (if
applicable) must sign the paper 8453. The signed 8453 must then be scanned into a
PDF document and inserted into the electronic return as a binary attachment. The
binary attachment must be named “8453 Signature Document”.
Note: Naming the binary attachment with a different name will cause the return to
reject.
Elections That Require Separate Signatures
IRS Counsel reviewed Regulations to identify elections that require a signature to

determine if the requirements can be changed. IRS published the results to this
review on the Large and Mid-Size Businesses web page at
http://www.irs.gov/businesses/corporations/article/0,,id=146959,00.html. Elections
that require a separate signature may be submitted in PDF format.
Special Instructions When Attaching Binary Files
Binary files attached to a return must contain a meaningful title or explanation for the
attachment. The description will be used when the IRS displays the name of the
attachment. Examples include: “Taxable Income Bracket Allocation” or “Statement of
Corporate Reorganization”.
Special Instructions for Supporting Data Required by Form 8865
In many instances information on schedules attached to Form 1065 will be the same
schedules required to be filed with Form 8865, Return of US Person with Respect to
Certain Foreign Partnerships. If a taxpayer has already prepared Form 1065 and has
completed Schedules B, D, K, K1, L, M-1, M-2, do NOT attach the Form 1065
schedules to the return, instead copy the data from the Form 1065 schedules to the
corresponding Form 8865 schedules.
______________________________________________________________________
Avoiding Refund Delays
EROs should advise taxpayers that they can avoid refund delays by having all of their
taxes and obligations paid, providing current and correct information to the ERO,
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ensuring that all bank account information is up-to-date and carefully checking their tax
return information before signing the return.
Suggestions to avoid rejects and refund delays:
Exercise care in the entry of tax return data into tax return preparation software and
carefully check the tax return information before signing the tax return;
Avoid taxpayers who insist on claiming dubious items on tax returns or present
altered or suspicious documents;
Ask taxpayers if there were problems with last year’s return; if so, see if the
conditions that caused the problems have been corrected or can be avoided this
year; and
Keep track of client issues that result in refund delays and analyze for common
problems; counsel taxpayers on ways to address these problems.
Submitting the Electronic Return to the IRS
An ERO must originate the electronic submission of a return as soon as possible after it
is signed. Please emphasize to your customers that they MUST NOT send a
paper copy of their return to the IRS, doing so will create duplicate filings.
An ERO must ensure that stockpiling of returns does not occur at its offices. Stockpiling
refers to either collecting returns from taxpayers or from another Authorized IRS e-file
Provider prior to official acceptance in IRS e-file. Or, after official acceptance to
participate in IRS e-file, stockpiling refers to waiting more than three calendar days to
submit the return to the IRS once the ERO has all necessary information for origination.
Returns that are held prior to the date that electronic returns may be transmitted to the
IRS are not considered stockpiled.
______________________________________________________________________
Record Keeping and Documentation Requirements
EROs must retain the information listed below until the end of the calendar year in
which the return was filed or nine months after a fiscal year return was filed. An ERO
may retain the required records at the business address of the Responsible Official
during any period of time the office is closed. The ERO must make the records available
to the IRS upon request.
A copy of signed IRS e-file Consent to Disclosure forms for taxpayers who
signed using an electronic signature;
The acknowledgement file for IRS accepted returns.
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Forms 8878-A, 8879-C, 8879-S , 8879-PE, 8879-B, 8879-EO, must be available to the
IRS in the same manner described above, for three years from the due date of the
return or IRS received date, whichever is later.
EROs may electronically image and store all paper records they are required to retain
for IRS e-file. This includes signed signature documents as well as any supporting
documents not included in the electronic record and all signature documents. The
storage system must satisfy the requirements of Revenue Procedure 97-22, Retention
of Books and Records. In brief, the electronic storage system must ensure an accurate
and complete transfer of the hard copy to the electronic storage media. All records
must be able to be reproduced with a high degree of legibility and readability (including
the taxpayers’ signatures) when displayed on a video terminal and when reproduced in
hard copy.
Electronic Filers who are required to originate their own returns must retain all
information that a taxpayer would retain for the appropriate time period.
______________________________________________________________________
Providing Information to the Taxpayer
The ERO must provide a complete copy of the return to the taxpayer in any media,
including electronic media, that is acceptable to both the taxpayer and the ERO.
However, the copy need not contain the taxpayer identification number of the paid
preparer. A complete copy of a taxpayer's return includes jurats, as well as the
electronic portion of the return. The electronic portion of the return can be contained on
a replica of an official form or on an unofficial form. However, on an unofficial form, data
entries must be referenced to the line numbers or descriptions on an official form. If the
taxpayer provided a completed paper return for electronic filing and the information on
the electronic portion of the return is identical to the information provided by the
taxpayer, a printout of the electronic portion of the return does not have to be provided
to the taxpayer. The ERO should advise the taxpayer to retain a complete copy of the
return and any supporting information.
Acknowledgements of Transmitted Return Data
The IRS electronically acknowledges the receipt of all transmissions and returns.
Each return in a transmission is either accepted or rejected for specific reasons.
Returns which meet the processing criteria are considered “filed” as soon as the return
is accepted. Rejected returns that fail to meet processing criteria are considered “not
filed.” The acknowledgement identifies the source of the reject and uses business rules
to explain the problem. A business rule will explain why the transmission or return
rejected (See Exhibit 7, Business Rules).
If the ERO makes changes to the electronic return after the jurat has been signed by
the taxpayer (whether it was before transmitting or if the return was rejected after
transmission) returns can be corrected and transmitted without new signatures or
authorizations if changes to corporate returns are not more than $150 to "Total Income"
or more than $100 to "Taxable Income". New signatures or authorizations are not
50
required for Exempt Organizations if changes to the reported gross receipts are not
more than $100. If the changes are more than the amounts listed, the taxpayer is
required to sign a new jurat or signature authorization and the taxpayer must be given a
copy of the applicable document (either paper or electronic).
When the MeF system has finished processing a return, it generates an

acknowledgement that acts as an electronic confirmation of the status of each return,
accepted or rejected. The ERO must, at the request of the corporation, provide the
*SubmissionID Number and the date the electronic return was accepted by the IRS.
The ERO must also, if requested, supply the electronic postmark, if the Transmitter
provided one for the return. This information can be found in the acknlowledgement
sent to the Transmitter.
*SubmissionID – 20 position field: (EFIN, YYYY, Julian Day, 7 position Alphanumeric)
_____________________________________________________________________
Resubmission of Rejected Extensions
If the Service rejects the extension request and the reason for the rejection cannot be
corrected and retransmitted, the ERO must take reasonable steps to inform the
taxpayer of the rejection within 24 hours. When the ERO advises the taxpayer that the
extension has not been filed, the ERO must provide the taxpayer with the Business
Rule explanation (See Exhibit 7).
• If the electronic extension can be retransmitted it must be filed by the later of the
due date of the return or 5 calendar days after the date the Service gives
notification the return is rejected
• If the electronic extension cannot be accepted for processing electronically, the

taxpayer must file a paper extension. In order for the paper extension to be
considered timely it must be filed by the later of the due date of the return or 5
calendar days after the Service gives notification the extension is rejected. The
paper extension should include an explanation of why the extension is being filed
after the due date and include a copy of the reject notification.
______________________________________________________________________
Transmission Perfection Period
When a transmitted electronic return is rejected, there is a 20 day Transmission

Perfection Period to perfect that return for electronic re-transmission. For Form 7004
and 8868 extensions the perfection period is 5 days. Perfection of the return for
electronic re-transmission generally means that the originally signed return may have
errors in the format of the XML or errors that cause the return to fail the IRS e-file
business rules.
When a previously rejected electronic return is Accepted by the IRS within the 20 day
Transmission Perfection Period, it will be deemed to have been received on the date of
the first reject that occurred within that 20 day period.
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The 20 days is actually a look back period and is determined once the return is
accepted. IRS looks back 20 days from the date the return is Accepted to determine if
there have been any rejects for the same EIN and Year. If there have been one or
more rejects within that 20 day look back period, IRS uses the received date on the
earliest reject as the received date for the Accepted return . A GTX key is generated for
returns transmitted through EMS and IFA, based on the received date of the return.
Returns that are transmitted through Application to Application use a timestamp as a
received date. (Note: the received date is the electronic postmark, if present, or the IRS
received date in the GTX Key Timestamp)
The chart below provides examples of how IRS determines received dates. The chart
assumes 1st rejection occurs on date of transmission, 2nd rejection occurs on date of
retransmission, and acceptance occurs on date of final transmission. The IRS received
date is used for purposes of determining whether a return is timely filed.
Tax Year Due Date Original 2nd Accepted IRS

End transmission/ 1st transmission Date/ final Received
Reject Date / Reject Date transmission Date
1 12/31/06 03/15/07 03/10/07 03/12/07 03/30/07 03/10/07
2 12/31/06 03/15/07 03/15/07 03/25/07 04/10/07 03/25/07
3 12/31/06 03/15/07 03/10/07 03/15/07 04/04/07 03/15/07
4 12/31/06 03/15/07 08/10/07 09/18/07 09/25/07 09/18/07
5 03/31/07 06/15/07 08/10/07 12/15/07 01/01/08 12/15/07
6 12/31/06 03/15/07 NA NA 10/01/07 10/01/07
How to Determine IRS Received Date:

# 1 – Return corrected and accepted on 3/30 and there were two rejects within the 20
day look back period. The earliest reject date (3/10) is used.
# 2 - Return corrected and accepted on 4/10/07 and had a previous reject within 20 day
look back period (3/25/07)
# 3 – Return corrected and accepted on 4/4 and had one reject within the 20 day look
back period (3/15/07)
# 4 – Return corrected and accepted on 9/25 and had one reject within the 20 day look
back period (9/18).
# 5 - Same as #4,
# 6 – Return transmitted and accepted and no rejected returns within 20 day look back
period. .
If the electronic return cannot be accepted for processing electronically because the
reason for the rejection cannot be corrected to comply with electronic filing
requirements, then the taxpayer must file a paper return. To be considered timely filed,
the paper return must be postmarked by the later of the due date of the return (including
extensions) or 10 calendar days after the date the Service gives notification that the
return was rejected and the e-filed returns could not be perfected. The paper return
should include an explanation of why the paper return is being filed after the due date,
and include a copy of the reject notification and brief history of actions taken to correct
the electronic return. NOTE: Corporations and Exempt Organizations required to
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file under Temporary Treasury Regulation Section 301.6011.5T must contact the
e-Help Desk for assistance in correcting rejects before filing a paper return.
53
Part V
Procedures For
Transmitters
of
MeF Returns
______________________________________________________________________
54
______________________________________________________________________
General
Please note that the Modernized e-File (MeF) Assurance Testing System
(ATS) is not configured exactly the same as the MeF Production system.
Therefore, a tester should not expect the same response time when testing in
the ATS environment versus the Production environment (especially
regarding performance or load testing)-- this includes testing a single
extremely large return in one transmission, several large returns in one
transmission, or a large number of concurrent transmissions.
As a new tax form type is added to the MeF platform (i.e. Form 1065), tax
returns will only be accepted for the current processing year (i.e. TY 2006).
As subsequent tax years are added to the system, MeF will only accept the
current processing year and two prior tax years. For example, Form(s)
1120/1120-S can only be e-filed for TY2006, TY2005 and TY2004.
Beginning in January 2008, MeF transmitters must use either IFA or A2A.
EMS will not be available to MeF transmitters in 2008.
EMS Changes for MeF Transmitters
You can find information on “What’s New for EMS in 2007” by accessing irs.gov at
http://www.irs.gov/efile/article/0,,id=150166,00.html.
All direct transmitters who login to the 2007 Electronic Management System (EMS) for
Tax Year 2006 will be required to enter a new EMS Login ID that will be mailed to
them. Each Electronic Transmitter Identification Number (ETIN) will be associated with
its own EMS Login ID.
All business production transmissions must be sent through either the EMS Internet
solution or via an IRS-approved Trading Partner-provided encrypted dedicated/leased
line. If transmitters do not have the IRS documents and specifications concerning
Internet Filing or Dedicated Leased Line Encryption, send an e-mail to: E-
[email protected].
For MeF transmitters using the EMS Encryption Internet solution to access EMS, you
must use the following URLs:
Testing – efileB.ems.irs.gov
Production – efileC.ems.irs.gov
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______________________________________________________________________
Transmitter Requirements
A Provider participating in MeF as a Transmitter must fulfill the requirements below.
Transmit all electronic portions of returns to the appropriate IRS center within
three calendar days of receipt;
Retrieve the acknowledgement file within two work days of transmission;
Match the acknowledgement file to the original transmission file and send the
acknowledgement file for all rejected and accepted returns, to the ERO or
Intermediate Service Provider within two work days of retrieving the
acknowledgement file;
Retain an acknowledgement file received from the IRS for one year from the date
the electronic return was filed;
Immediately contact the IRS e-Help Desk toll-free number 1-866-255-0654 for
further instructions if an acknowledgement of acceptance for processing has not
been received within 24 hours of transmission or if an acknowledgement for a
return that was not transmitted in the designated transmission is received;
Promptly correct any transmission error that causes an electronic transmission to

be rejected;
Contact the IRS e-Help Desk toll-free number 1-866-255-0654 for assistance if
the electronic portion of the return has been rejected after three transmission
attempts;
Ensure the security of all transmitted data;
Ensure against the unauthorized use of its EFIN or ETIN. A Transmitter must not
transfer its EFIN or ETIN by sale, merger, loan, gift, or otherwise to another
entity; and
Use only software that does not have an IRS assigned production password built
into the software.
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Additional Transmitters Responsibilities for On-Line Providers
On-Line Filing is a method of electronic filing through a personal computer. The

corporation submits the electronic return from a personal computer to an authorized On-
Line Provider. An Intermediate Service Provider may be involved to assist in
processing tax return information between the corporation and the On-line Provider.
Publication 4164 outlines requirements for all transmitters in the IRS e-file program. In
addition to those requirements, a Transmitter participating in On-Line Filing has some
additional responsibilities. When participating in On-Line Filing, the On-Line Provider
must:
Ensure that it uses an EFIN or ETIN obtained for On-Line Filing;
Ensure that Intermediate Service Provider’s EFIN is included in the electronic

return data, when applicable;
Transmit On-Line returns and returns filed using an ERO in separate batches.
Notify the corporation (taxpayer) of the status of a return by:

o sending an electronic transmission to the taxpayer or Intermediate Service
Provider, when applicable, within two work days of retrieving the
acknowledgement file from the IRS, or;
o by mailing a written notification to the taxpayer within one work day of
retrieving the acknowledgement file;
Provide the Internet Protocol (IP) information. The information consists of the IP
Address, IP Date, IP Time and IP Time Zone.
Only enter into agreements with companies to allow access to On-Line Filing if
the company correctly captures the IP Address of the computer submitting the
return and the date, time, time zone of the computer receiving it.
Include the Originator Type, “OnlineFiler”, in the Return Header.
The Transmitter must notify the corporation of the following:
Accepted Returns
• Provide the acknowledgement File
Rejected Returns
• That the IRS rejected the electronic portion of the taxpayer’s
return;
• Date the return was rejected;
• The Business Rule explaining why the return was resulting in
the Reject condition;
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• What steps the taxpayer needs to take to correct the errors that
caused the reject; and
• That if the taxpayer chooses not to have the electronic portion of
the return corrected and transmitted to the IRS, or, if the
electronic portion of the return cannot be accepted for
processing by the IRS, the taxpayer must file a paper return. In
order to be filed timely, the paper return must be filed by the
later of the due date of the return or 10 calendar days after the
date the IRS gives notification that the electronic portion of the
return is rejected or that it cannot be accepted for processing.
The paper return should include an explanation of why the
return is being filed after the due date.
Note: If taxpayer is required to e-file their return under Treasury Regulaton

Section 301.6011-5T, contact the e-Help Desk before filing the paper return.
Electronic Postmark
A Transmitter may provide an electronic postmark to taxpayers that file Tax Returns and
Extensions of Time to File Tax Returns, through an ERO or through On-Line Filing. The
Transmitter creates the electronic postmark bearing the date and time (in the
Transmitter’s time zone) that the return is received at the Transmitter’s host computer.
The taxpayer must adjust the electronic postmark to the time zone where the ERO is
located or where the taxpayer resides in the case of On-Line Filing to determine the
postmark’s actual time. For example, if the Transmitter provides an electronic postmark
with a time in the Pacific Time Zone but the taxpayer resides in the Eastern Time Zone,
the taxpayer must add three hours to the postmark time to determine the actual
postmark time (Eastern Time Zone).
If the electronic postmark is on or before the prescribed deadline for filing but the return
is received by the IRS after the prescribed deadline for filing, the return will be treated
as filed on the electronic postmark’s date. If the electronic postmark is after the
prescribed deadline for filing, the IRS actual receipt date, not the date of the electronic
postmark will be the filing date. If a return is rejected, a corrected return must be filed in
accordance with the rules for timely filing corrected returns after rejection of an
electronic return.
A Transmitter is authorized to provide an electronic postmark if the Transmitter:
Creates an electronic postmark bearing the date and time (in the Transmitter’s
time zone) the return was received by the Transmitter’s host system;
Provides the electronic postmark to the taxpayer or the ERO no later than when
the acknowledgement is made available to the taxpayer in a format that
precludes alteration and manipulation of the electronic postmark information;
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Provides the same electronic postmark data to the IRS in the electronic record of
the return;
Provides taxpayers with an explanation of the electronic postmark and when the
IRS treats the electronic postmark as the filing date;
Refrains from using terms that currently have specific meaning in the postal
industry such as “certified” or “registered” and similar terms, and from using
“Internal Revenue Service”, “IRS” or “Federal” as a definer of the electronic
postmark when discussing the electronic postmark, including in all advertising,
product packaging, articles, press releases, and other presentations;
Retains a record of each electronic postmark for one year and provides the
record to the IRS upon request;
Transmits all tax returns and extensions of time to file that received an electronic
postmark to the IRS within two days of receipt from the ERO or from the taxpayer
in the case of On-Line Filing.
Routine Maintenance
There is a routine weekly maintenance window for MeF that is scheduled from
1am to 7am, EST on Sundays. Transmitters should plan that there willl be
intermittent down time during this window and no additional communicaton will
be made on this down time. Wheneever possible, MeF will communicate with
transmitters any unscheduled outage of more than two hours during non-peak
time or one hour during peak times.
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Part VI
Procedures For Other
Authorized IRS e-file Providers
______________________________________________________________________
60
In addition to Electronic Return Originators and Transmitters previously discussed, there
are other activities performed by Authorized IRS e-file Providers, including intermediate
service and software development.
Intermediate Service Providers
An Intermediate Service Provider receives tax information from an ERO (or from a
taxpayer who files electronically using a personal computer, modem, and commercial
tax preparation software), processes the tax return information, and either forwards the
information to a Transmitter or sends the information back to the ERO or taxpayer (for
On-Line Filing).
An Authorized IRS e-file Provider participating as an Intermediate Service Provider must

meet the following responsibilities to participate in IRS e-file. The Intermediate Service
Provider must:
Deliver all electronic returns to a Transmitter or the ERO who gave the electronic
returns to the Intermediate Service Provider within three calendar days of receipt;
Retrieve the acknowledgement file from the Transmitter within one calendar day
of receipt by the Transmitter and send the acknowledgement file to the ERO
(whether related or not) within one work day of retrieving it;
Retain each acknowledgement file received from a Transmitter for one year
Send any return and jurat needs changes as described in Part IV back to the
ERO for correction.
Additional Requirements for Participants in On-Line Filing
When a return is filed using On-Line Filing, the Intermediate Service Provider processes
information for a taxpayer so that a Transmitter can send the electronic return(s) to the
IRS. In so doing, the Intermediate Service Provider must:
Ensure that it uses an EFIN obtained for On-Line Filing;
Ensure that it s On-Line Filing EFIN is included in the electronic return data,
when applicable;
Send the transmission to the Transmitter within 24 hours of the receipt of the
return from the taxpayer;
Immediately forward to the taxpayer information received from the Transmitter as

required for On-Line Filing. For example, a Transmitter receives information from
the IRS regarding the status of the electronic portion of a taxpayer’s return.
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Software Developers
A Software Developer develops software for the purposes of formatting electronic return
information according to IRS e-file specifications and/or transmitting electronic return
information directly to the IRS. IRS e-file specifications may be found in Publication
4164, Modernized e-File Guide for Software Developers and Transmitters. Software
Developers must pass Assurance Testing as prescribed in Publication 4162,
Modernized e-File Test Package for Forms 1120/1120-S. Publication 4505, Modernized
e-File Test Package for Forms 1065/1065-B, and Publication 4205, Modernized e-file
Test Package for Exempt Organization Filings.
A Software Developer must:
Promptly correct any software error which causes the electronic portion of a
return to be rejected and then promptly distribute that correction;
Ensure that any software package that will be used to transmit electronic portions
of returns from multiple Authorized IRS e-file Providers has the capability of
combining returns from these Providers into one IRS transmission file.
Ensure that its software contains appropriate language and version indicators for
Consent To Disclose and Jurat statements;
Ensure software contains IRS e-file Signature Authorization; and
Ensure its software allows for input of different addresses on appropriate forms
and schedules.
In addition a Software Developer that participates in On-Line Filing must also:
Ensure that it’s software contains Form 8453-C, 8453-S, 8453-EO, 8453-PE,
8453-B in a format that can be printed
Ensure the Internet Protocol (IP) statement is present.
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Part VII
Guidelines For Transition From
Paper to Electronic Filing
______________________________________________________________________
63
Transition From Paper to Electronic Filing
The information included in this section will help EROs understand and plan for the
differences of preparing a paper return versus an electronic return/extension.
IRS requires all tax return data (forms, supporting data, and elections) to be transmitted
to IRS in one transmission file. If EROs uses multiple tax preparation software
packages to prepare a tax return, they should check with the software vendor(s) to
determine how to aggregate the various portions of the tax return into the defined
electronic format and transmit to IRS in one transmission file.
IRS defined a flexible structure that must be used to create electronic income tax
returns. This structure is necessary and critical to ensure tax preparation software can
create an electronic return which can be transmitted to and viewed by IRS systems.
IRS issues the required structure for all forms in XML schemas. IRS develops the XML
schemas and makes them available to software vendors who are required to use them
to develop tax preparation software marketed for electronic filing. Additional information
on the processes used by IRS and software vendors to develop and test tax preparation
software approved for electronic filing is available on http://www.irs.gov/
Preparing Supporting Data Required by IRS Forms or Form Instructions
IRS reviewed all of the forms and form instructions and identified every instance where
taxpayers are required to attach supporting data. IRS provided XML schemas that
defined a format that must be used to report the supporting data. In certain instances,
IRS allows some forms/schedules and supporting data to be attached to the electronic
return as a PDF file, but only in situations where IRS has not defined a format in an
XML schema. Most software vendors plan to allow EROs the ability to import/export
data from other sources. EROs should discuss options for importing supporting data
created in other formats into the tax preparation software. It is the responsibility of
software vendors to provide appropriate instructions for taxpayers to enter supporting
data that meets the IRS guidelines. The examples on the following pages will assist
EROs in understanding how to prepare supporting data for electronic returns when
required by form or form instructions. The examples below reflect many forms, but the
same applies across all form types that can be electronically filed.
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Example 1 – Supporting data required by IRS forms.
IRS issued specific formats that software vendors must use for this type of supporting
data. In the example below, taxpayers must include (either by entering or importing)
data for the required “type” and “amount of income” as indicated in tax preparation
software instructions.
From Instructions
Line 10 Other Income
Enter any other taxable income not
reported on lines 1 through 9. List
The “type” and “amount of
Income” on an attached schedule.
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Example 2 - Supporting data required by IRS form instructions.
In the example below, taxpayers must include (either by entering or importing) required
data for “description of property” and “depreciation method” as indicated by tax
preparation software instructions.
Page 4, Form 4562 Instructions

for line 15 states:
66
Example 3 – Supporting data required as another IRS form.
In the following example, form instructions require the taxpayer to attach another IRS
form or statement as supporting data. Line 2(a) and 2(b) require supporting data to be
provided using an IRS form; failure to use the required IRS form will cause electronic
return to reject. Line 2(c) requires supporting data to be provided using an attached
statement; taxpayers should always provide the supporting data.
67
Example 4 – Supporting Data required for tables on IRS forms.
When required data exceeds number of lines provided on IRS forms, tax preparation
software may or may not allow the taxpayer to continue to enter all necessary data
instead of creating an attachment. Check with your software vendor to see if their
software will allow entering unlimited lines of data. When the electronic data is
transmitted and processed the data will be displayed as “repeating data” by MeF
systems.
Taxpayer data exceeds the

number of lines provided on
IRS forms
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Creating Elections Required by Forms or Form Instructions
IRS reviewed all forms and form instructions to identify where taxpayers are required to
attach supporting data and many of these requirements are elections. When the
election is required by IRS forms or form instructions, IRS provided specific XML
formats for each election that must be used by software vendors for developing tax
preparation software approved for electronic filing. EROs must use the defined format
to enter data for these elections. The examples below are samples of elections
required by form instructions.
Form 1120 Instructions Dual Consolidated Losses Statement

Form 8697 Instructions De Minimis Exception Election
Form 4562 Instructions Election Not to Claim Special Depreciation Allowance
Creating Elections/Disclosure Statements Required by

Regulations or Publications
MeF requires all disclosure statements and elections to be included in tax preparation
software and transmitted to the IRS in one transmission file.
IRS did not review all Regulations and Publications to identify instances where
corporations can make elections. Instead, IRS created a General Dependency schema
that must be used to report most elections required by Regulations or Publications.
IRS issued a defined format for the General Dependency schema and made it available
to software developers to use when developing tax preparation software approved for
electronic filing. EROs must use the General Dependency schema to report most
disclosure statements and elections required by Regulations or IRS Publications. Tax
preparation software approved for elections filing should provide instructions for
taxpayers to complete the General Dependency schema. The General Dependency
schema allows EROs to identify the disclosure statement/election using the following
data elements:
1. Form Line or Instructions Reference (optional) - This field should be completed

when the election is being made based on information on IRS forms or form
instructions and IRS has not defined a format. Note: As discussed above, in
most instances IRS has defined a format for these elections.
2. Regulation Reference (optional) - This field should be used to identify information
for elections made based on information contained in Regulations or
Publications.
3. Description (optional) - This field should be used to enter a brief explanation of
the election
4. Attachment Information (optional) - This field allows EROs to include text data,
up to 1,000,000 characters if the ERO chooses not to attach information in a PDF
format i.e. Plans of Merger, Plans of Reorganization etc. EROs should use the
69
Description field to make the election and tax preparation software will allow the
ERO to reference the PDF attachment information.
Note: IRS will allow all elections with “columnar data” to be attached in PDF format.
Below are examples EROs of how to create elections and/or disclosure statements
using formats defined tax preparation software.
Example 1 – Creating Elections that Do Not Contain Columnar Data
Election data that does not contain columnar data must be reported using the General
Dependency schema included in tax preparation software.
Regulation Reference Description

IRC Section 172(b) (3) Election to Forego Net Operating Loss Carryback
Pursuant to IRC Sec. 172(b) (3), taxpayer hereby elects to relinquish the entire
carryback period with respect to the net operating loss(es) incurred in this tax year
ended
Example 2 - Creating Elections That Apply to Multiple Subsidiaries
Election data that applies to multiple subsidiaries and do not contain columnar data
must be reported using the General Dependency schema included in tax preparation
software.
Regulation Reference Description

IRC Section 172(b) (3) Election to Forego Net Operating Loss Carryback
Pursuant to IRC Sec. 172(b)(3), taxpayer hereby elects to relinquish the entire
carryback period with respect to the net operating loss(es) incurred in this tax year
ended for the following subsidiaries
ABC Corporation
CDE Corporation
EFG Corporation
Example 3 - Creating Elections that Contain Columnar Data
Elections that require columnar data may be attached to the electronic return in PDF
format. Separate PDF files must be created for each election. Use the Regulation to
create the name of the PDF file.
IRS Section 195(b) Election to Amortize Start-Up Expenditures
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Taxpayer Name: ABC Corporation
Taxpayer ID Number: 10-0000002
Year-end: December 31, 2005
In accordance with IRC Sec. 195, taxpayer hereby elects to amortize all start-up
expenditures over a period of XX months beginning with July XX, 200X, the month that
the corporation's active trade or business began (or was acquired).
The trade or business of the taxpayer to which this election relates is XXXXXX
The start-up expense incurred is:
Description of Start-Up Expense Date Incurred Amount
Preparing Elections That Require Supporting Data
Some disclosure statements and/or elections require supporting data which cannot be
entered into the General Dependency schema (i.e. Plans of Merger, Plans of
Reorganization, meeting notes, etc). IRS allows this type of supporting data to be
attached to the General Dependency schema as a PDF file. The actual disclosure
statement and/or election must be entered into the required format and only the
supporting data may be submitted as a PDF file.
Note: IRS Counsel reviewed Regulations to determine if the requirements to submit

supporting data such as Plans of Merger could be modified. IRS Counsel will not
change the requirement to gather the information but modified the Regulations and
allow corporations to retain the data instead of attaching to the tax return and sending to
IRS. IRS published the results to this review on
http://www.irs.gov/newsroom/article/0,,id=157721,00.html under e-file for Large and
Mid-Size Businesses in early 2006.
IRS Eases Reporting Burden on Corporations and Shareholders (May 26, 2006)
The Internal Revenue Service has announced new regulatory revisions that will reduce
the reporting burden on corporations and shareholders while also making it easier for
them to file their tax returns electronically.
• Revenue Procedure 2006-21
• REG-134317-05
• TD 9264
71
Part VIII
MeF Section
For
FORM 1120
And
FORM 1120S
72
General
All corporations are encouraged to voluntarily file their corporate Forms 1120 and 1120-
S income tax returns electronically. Temporary Treasury Regulation Section 301.6011-
5T, issued January 11, 2005, requires corporations with assets of $50 million or more
and file at least 250 returns a year to electronically file Forms 1120 and 1120-S for tax
years ending on or after December 31, 2005.
The requirement will apply to corporations with assets of $10 million or more for tax years
ending on or after December 31, 2006.
The determination of whether a corporation is required to file at least 250 returns is made by
aggregating all returns, regardless of type, that the entity is required to file over the calendar
year, including, for example, income tax returns, returns required under section 6033,
information returns, excise tax returns, and employment tax returns.
IRS developed guidance which applies to all corporations required to e-file under the
temporary regulations. This guidance is published in Tax Year 2006 Directions for
Corporations Required to e-file and is intended to assist with their transition from preparing a
paper return to electronic filing. ERO’s with clients which are corporations required to e-file
should review this document and other useful information, including Frequently Asked
Questions available at http://www.irs.gov/ Simply click on the “e-file” logo and then click on ”e-
file for Large and Mid-size Corporations”.
The following information will help determine how corporations must file electronically.
Corporations with assets under $10M must use an Authorized IRS e-file Provider
to file their corporate income tax return electronically.
Corporations with assets of $10M or more may either use an IRS Authorized
e-file Provider to electronically file their corporate income tax return or electronically
file their own corporate income tax return.
Forms Attached to 1120/1120-S with Separate Signatures
Many forms that may be attached to Form 1120 and 1120-S have separate signature
lines. During the development of MeF IRS identified all of the forms with separate
signature lines and requested IRS Counsel to issue special instructions to facilitate
electronic filing. Regulation T.D. 9100 contains amendments to the Income Tax
Regulations (26 CFR Part 1) and Procedure and Administration Regulations (26 CFR
part 301) and eliminates some of regulatory requirements considered impediments to
the electronic submission of tax returns and other forms filed by corporations,
partnerships and other businesses with regard to third party signature requirements.
These regulations impeded electronic filing by 1) requiring taxpayers to include third
party signatures on their tax returns; 2) requiring taxpayers to attach documents or
statements generated by third parties; or 3) requiring a taxpayer to sign an IRS form
and file it as an attachment to their income tax return. T.D. 9100 eliminates the
impediments for taxable years beginning after December 31, 2002. The regulations
73
generally affect taxpayers who are required to file any of the following forms: 926, 973,
982, 1120, 1120-S, 1122, 5471, 5712-A, 8832. See T.D 9100 for a complete list.
______________________________________________________________________
Signing an Electronic Return
As with any corporate income tax return submitted to the IRS on paper, an electronic
corporate income tax return must be signed by an authorized corporate officer and the
paid preparer, if applicable. The corporation (taxpayer) must designate a principal of the
firm responsible for signing the corporate income tax return following the procedures
outlined in Treasury Regulation Section 1.6062-1. The corporate officer must sign and
date the “Declaration of Taxpayer” (Form 8453-C or Form 8453-S).
Corporation - For all signature options, the corporate officer must sign and date the
“Declaration of Taxpayer” to authorize the origination of the electronic submission of the
return to the IRS prior to the transmission of the return to IRS. The Declaration of
Taxpayer includes the taxpayer’s declaration under penalties of perjury that the return is
true, correct and complete, as well as the taxpayer’s Consent to Disclosure. The
Consent to Disclosure authorizes the IRS to disclose information to the taxpayer’s
Authorized IRS e-file Providers. Intermediate Service Providers, Transmitters and
EROs are authorized by taxpayers to receive acknowledgement of receipt or reason for
rejection of the electronic return from IRS.
If the electronic return data on a corporate income tax return is changed after the
taxpayers signed the Declaration of Taxpayer, taxpayers must sign a new declaration if
the “Total Income” amount differs by more than $150 or the “Taxable Income amount
differs by more than ”$100.
Special Instructions When Copies of Original Forms are Required to be Filed

Prior to Filing the Electronic Return
Special attention should be paid when instructions call for processing a form prior to
filing the electronic return. For example instructions call for the Form 4466, Corporation
Application for Quick Refund of Overpayment of Estimated Tax, should be filed prior to
filing the return in order to receive a quick refund. When this occurs, the taxpayer
should file the form with the appropriate Processing Center and a copy of the Form
4466 should be attached to the electronic return, but note that the electronic copy will
not be processed. The copy attached to the electronic return will be used for
information only.
There are other forms that may fall in this category. Special attention should be paid
when instructions call for processing a form prior to filing the electronic return. MeF will
keep copies of these forms for informational purposes only.
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Special Instructions for Form 1120, Line 32f, Credits
If a taxpayer has a large credit that is not associated with a line number on Form 1120
and the Form 1120 instructions do not provide procedures for “writing in” the credit
anywhere on the return; the credit type and amount should be provided using the “Other
Refundable Credit” indicator element in the XML schema. (i.e. Form 1120, Section 33
credits that need to be included as part of TotalPayments (currently Line 32h) The large
credit amount should then be included in the total on line 32h.
Additionally, if a taxpayer has one or more large credits, the “Other Refundable Credits
Schedule” schema should be used to itemize the types of credits and credit amounts,
and to provide a sum of the credit amounts itemized. The Regulation reference should
also be included. The Other Refundable Credits Schedule should be attached to line
32f. The sum of the itemized large credits should be included in the total on line 32h.
Special Instructions for Form 1120 Section 847 Special Estimated Tax Payments
(SETPs)
If a taxpayer is required to make or apply special estimated tax payments under section
847 in addition to their regular estimated tax payments, the amount should be included
in the total estimated tax payments on line 32b. Your software should allow you to
enter “Form 8816” or “Section 847 Deduction” and the amount. Allowing either entry will
assist the IRS in properly accounting for your SETPs and to prevent the need to
correspond with the taxpayer in order to obtain clarification of the amount(s) claimed.
Special Instructions for Form 8838 When Filed With Form 1120
The signature on Form 1120 extends to all accompanying statements and schedules
with the exception of Form 8838, Consent to Extend the Time to Assess Tax Under
Section 367 – Gain Recognition Agreement. A signed copy of Form 8838 may be
submitted as a PDF file attached to the electronic Form 1120/1120-S.
_____________________________________________________________________
Checksum for 1120 Filers
Tax prep software approved for electronic filing will compute a checksum value and
embed the total in the submission file sent to IRS. The MeF system will also compute a
checksum value of the submission file. The MeF system will add the following 4 new
XML elements in the submission acknowledgement, regardless of whether the
submission is accepted or rejected:
1. <EmbeddedCRC32>
2. <ComputedCRC32>
3. <TaxableIncome>
4. <TotalTax>
The taxpayer/ERO should check the data in the <EmbeddedCRC32> element and the
<ComputedCRC32> element to ensure that the size of the file transmitted to the IRS is
the same size as the file computed by the IRS. If there is a discrepancy between the
75
two values, it is the responsibility of the ERO to contact the transmitter to see if the file
was changed before transmission
____________________________________________________________________
Checksum for Other MeF Type Filers
The check sum for all other MeF Type filers is the same as stated above for the 1120
filers. The MeF system will add the same following 4 new XML elements in the
submission acknowledgement, regardless of whether the submission is accepted or
rejected, but the <TaxableIncome> and <TotalTax> values will default to zero.
1. <EmbeddedCRC32>
2. <ComputedCRC32>
3. <TaxableIncome>
4. <TotalTax>
The taxpayer/ERO should check the data in the <EmbeddedCRC32> element and the
<ComputedCRC32> element to ensure that the size of the file transmitted to the IRS is
the same size as the file computed by the IRS. If there is a discrepancy between the
two values, it is the responsibility of the ERO to contact the transmitter to see if the file
was changed before transmission
76
______________________________________________________________________
TY2006 - 1120/1120-S/1120POL Due Dates
Tax Period Tax Period Due Date 6 Month Extension Tax Year of
Beginning & (Weekends & Due Date (Weekends Return
Ending Dates Holidays & Holidays
Considered) Considered)
#
1/1/06—12/31/06 200612 3/15/07 9/17/07 2006
2/1/06—1/31/07 200701 4/17/07 10/15/07 2006
3/1/06—2/28/07 200702 5/15/07 11/15/07 2006
4/1/06—3/31/07 200703 6/15/07 12/17/07 2006
5/1/06—4/30/07 200704 7/16/07 1/15/08 2006
6/1/06—5/31/07 200705 8/15/07 2/15/08 2006
7/1/06—6/30/07 200706 9/17/07 3/17/08 2006
8/1/06—7/31/07 200707 10/15/07 4/15/08 2006
9/1/06—8/31/07 200708 11/15/07 5/15/08 2006
10/1/06—9/30/07 200709 12/17/07 6/16/08 2006
11/1/06—10/31/07 200710 1/15/08 7/15/08 2006
12/1/06—11/30/07 200711 2/15/08 8/15/08 2006
# Legal Due Date is the 15th of each month.
77
_____________________________________________________________________________
Tax Year 2004
Accepted Forms and Schedules for Forms 1120/1120-S
Note: Form 7004 does not have any additional forms or schedules that can be attached.
The chart below identifies the 1120/1120-S forms and schedules that will be accepted
for Tax Year 2004 and the maximum number of forms that may be submitted with each
return.
For forms marked with a single asterisk; the preparer can only attach one form to Form
1120 or 1120-S, and only one to each Form 8865. For example, Form 3468 can be
attached to Form 1120 or Form 1120-S, and to each Form 8865. As a result, you can
have multiple Forms 3468 attached to a return.
Schedule M-3 (Form 1120) is marked with the double asterisks because when filing
Form 1120-S, if the corporation meets the criteria outlined in Revenue Procedure 2004-
45, then the preparer can attach one Schedule M-3 (Form 1120) in lieu of Form 8886.
Forms marked with triple asterisks will not be accepted. On October 22, 2004, the
President signed H.R. 4520, the "American Jobs Creation Act of 2004." This
legislation repeals the extraterritorial income exclusion in current tax law; provides
domestic manufacturing and other business tax relief, including energy-related tax
credits; allows for itemized deduction of State and local sales taxes; provides for reform
of tobacco subsidies; includes international tax reform and simplification provisions; and
includes various revenue-raising provisions. Due to the extensive nature of the changes
and timing of when the bill was signed, IRS plans are to restrict acceptance of the
impacted forms until a later date. When these forms become accepted electronically by
the MeF, notification will be published on the irs.gov website.
Form 1120 1120-S

Form 1120 1 0
Schedule D (Form 1120) 1 0
Schedule H (Form 1120) 1 0
Schedule M-3 (Form 1120) 1 1**
Schedule N (Form 1120) 1 1
Schedule PH (Form 1120) 1 0
Form 1120-S 0 1
Schedule D (Form 1120-S) 0 1
Schedule K-1 (Form 1120-S) 0 Unbounded
Form 851 1 0
Form 926 Unbounded Unbounded
Form 970 1 1
Form 972 Unbounded 0
Form 973 1 0
Form 982 1 1
Schedule F (Form 1040)* Unbounded Unbounded
Schedule I (Form 1118) Unbounded Unbounded
78
Form 1120 1120-S
Schedule J (Form 1118) 1 1
Form 2220 1 1
Form 3468* Unbounded Unbounded
Form 3800 1 0
Form 4136 1 1
Form 4466 1 1
Form 4626 1 1
Form 5452 1 1
Schedule J (Form 5471) Unbounded Unbounded
Schedule M (Form 5471) Unbounded Unbounded
Schedule O (Form 5471) Unbounded Unbounded
Form 5712-A Unbounded 0
Schedule A (Form 5713) Unbounded Unbounded
Schedule B (Form 5713) Unbounded Unbounded
Schedule C (Form 5713) 1 1
Schedule P (Form 5735) Unbounded 0
Form 6781 1 1
Form 8050 1 1
Form 8082 1 1
Form 8275-R* Unbounded Unbounded
Schedule A (Form 8609)* Unbounded Unbounded
79
Form 1120 1120-S
Form 8716 1 1
Form 8810 1 0
Form 8825* 0 Unbounded
Form 8827 1 1
Form 8864*** Unbounded Unbounded
Schedule K-1 (Form 8865) Unbounded Unbounded
Schedule P (Form 8865) Unbounded Unbounded
Form 8866 1 1
Form T (Timber)* Unbounded Unbounded
80
______________________________________________________________________
Tax Year 2005
Note: Form 7004 does not have any additional forms or schedules that can be attached.
The chart below identifies the 1120/1120-S forms and schedules that will be accepted
for Tax Year 2005 and the maximum number of forms that may be submitted with each
return.
For forms marked with a single asterisk; the preparer can only attach one form to Form
1120 or 1120-S, and only one to each Form 8865. For example, Form 3468 can be
attached to Form 1120 or Form 1120-S, and to each Form 8865. As a result, you can
have multiple Forms 3468 attached to a return.
Schedule M-3 (Form 1120) is marked with the two asterisks because when filing Form
1120-S, if you meet the criteria outlined in Revenue Procedure 2004-45, you can attach
one Schedule M-3 (Form 1120) in lieu of Form 8886.
Form 1120 1120-S

Form 1120 1 0
Schedule M-3 (Form 1120) 1 1**
Form 1120L PDF only
Form 1120PC PDF only
Form 1120-S 0 1
Form 1128 PDF only
Form 851 1 0
Form 970 1 1
Form 973 1 0
Form 982 1 1
Schedule J (Form 1118) 1 1
Form 2220 1 1
81
Form 1120 1120-S
Form 3800 1 0
Form 4136 1 1
Form 4466 1 1
Form 4626 1 1
Form 5452 1 1
Form 5712-A Unbounded 0
Schedule P (Form 5735) Unbounded 0
Form 5884-A* PDF only
Form 6781 1 1
Form 8050 1 1
Form 8082 1 1
Form 8275-R* Unbounded Unbounded
Form 8609-A (replaces Form Unbounded Unbounded
8609, and 8609 Schedule A )*
Form 8716 1 1
Form 8810 1 0
82
Form 1120 1120-S
Form 8825* 0 Unbounded
Form 8827 1 1
Form 8866 1 1
Form 8895 1 0
Form 8900 1 0
Form 8903 1 0
Form 8906 PDF only
Form 8907 PDF only
Form 8908 PDF only
Form 8909 PDF only
Form 8910 PDF only
Form 8911 PDF only
Form 8912 PDF only
83
______________________________________________________________________
Tax Year 2006
Form 1120 1120-S

Form 1120 1 0
1120-L Unbounded 0
Schedule M-3 (Form 1120L) 1 0
1120-PC Unbounded 0
Schedule M-3 (Form 1120PC) 1 0
Schedule M-3 (Form 1120) 1 0
Schedule O (Form 1120) 1 0
Form 1120-S 0 1
Schedule M-3 (Form 1120-S) 0 1
Form 851 1 1
Form 973 1 0
Form 982 1 1
Form 1118 AMT Unbounded Unbounded
Form 1128 PDF only
Form 2220 1 1
Form 3800 1 0
Form 4136 1 1
Form 4466 1 1
Form 4626 1 1
Form 5452 1 1
84
Form 1120 1120-S
Form 5735 PDF only
Form 5884-A Unbounded Unbounded
Form 6781 1 1
Form 8050 1 1
Form 8275-R Unbounded Unbounded
Form 8716 1 1
Form 8810 1 0
Form 8827 1 1
85
Form 1120 1120-S
Form 8866 1 1
Form 8886*PDF accepted until xml Unbounded Unbounded
schema available
Form 8903 1 0
Form 8923 PDF only
86
Part IX
MeF Section
For
FORM 1065
And
FORM 1065-B
87
______________________________________________________________________
Tax Year 2006 Due Dates For 1065/1065/B
Tax Period Beginning Tax Earliest Due Date Extension Tax

& Ending Dates Period Date (Weekends Due Date Year of
Return & Holidays (Weekends Return
can be Considered) & Holidays
Filed * Considered)
1/1/06 - 12/31/06 200612 1/1/2007 4/17/2007 10/17/2007 2006
2/1/06 – 1/31/07 200701 2/1/2007 5/16/2007 11/15/2007 2006
3/1/06 – 2/28/07 200702 3/1/2007 6/15/2007 12/15/2007 2006
4/1/06 – 3/31/07 200703 4/1/2007 7/15/2007 1/17/2008 2006
5/1/06 – 4/30/07 200704 5/1/2007 8/16/2007 2/15/2008 2006
6/1/06 - 5/31/07 200705 6/1/2007 9/15/2007 3/15/2008 2006
7/1/06 -6/30/07 200706 7/1/2007 10/17/2007 4/15/2008 2006
8/1/06 - 7/31/07 200707 8/1/2007 11/15/2007 5/15/2008 2006
9/1/06 - 8/31/07 200708 9/1/2007 12/15/2007 6/15/2008 2006
10/1/06 -9/30/07 200709 10/1/200 1/17/2008 7/17/2008 2006
7
11/1/2006 - 10/31/07 200710 11/1/200 2/15/2008 8/15/2008 2006
7
12/1/06 - 11/30/07 200711 12/1/200 3/15/2008 9/15/2008 2006
7
* Legal Due Date is the 15th of each month.
88
Accepted Forms and Schedules for Forms 1065 and 1065-B
Forms Maximum Numbers

1065 1
1065-B 1
Schedule D (Form 1065) 1
Schedule K-1 (Form 1065) Unbounded
Schedule K-1 (Form 1065-B) Unbounded
Form 8308 Unbounded
Schedule M-3 (Forms 1065/1065-B) Unbounded
Form 8916-A 1
Form 970 Unbounded
Form 982 1
Schedule F (Form 1040) Unbounded
Form 3115 Unbounded
Form 3468 Unbounded
Form 4136 1
Form 4255 Unbounded
Form 4562 Unbounded
Form 4684 Unbounded
Form 4797 Unbounded
Form 5471 Unbounded
Schedule J (Form 5471) Unbounded
Schedule M (Form 5471) Unbounded
Schedule N (Form 5471) Unbounded
Schedule O (Form 5471) Unbounded
Form 5713 Unbounded
Schedule A (Form 5713) Unbounded
Schedule B (Form 5713) Unbounded
Schedule C (Form 5713) Unbounded
Form 5884 Unbounded
Form 5884-A Unbounded
Form 6252 Unbounded
Form 6478 Unbounded
Form 6765 Unbounded
Form 6781 1
Form 8082 Unbounded
Form 8271 Unbounded
Form 8275 Unbounded
Form 8275-R Unbounded
Form 8283 Unbounded
Form 8586 Unbounded
Form 8594 Unbounded
Form 8609-A Unbounded
Form 8611 Unbounded
Form 8621 Unbounded
89
Form 8697 Unbounded
Form 8716 1
Form 8820 Unbounded
Form 8824 Unbounded
Form 8825 Unbounded
Form 8826 Unbounded
Form 8832 Unbounded
Form 8834 Unbounded
Form 8835 Unbounded
Form 8844 Unbounded
Form 8845 Unbounded
Form 8846 Unbounded
Form 8847 Unbounded
Form 8858 Unbounded
Schedule M (Form 8858) Unbounded
Form 8860 Unbounded
Form 8861 Unbounded
Form 8864 Unbounded
Form 8865 Unbounded
Schedule K-1 (Form 8865) Unbounded
Schedule O (Form 8865) Unbounded
Schedule P (Form 8865) Unbounded
Form 8866 1
Form 8873 Unbounded
Form 8874 Unbounded
Form 8881 Unbounded
Form 8882 Unbounded
Form 8883 Unbounded
Form 8886 PDF only until the xml schema is Unbounded
available
Form 8896 Unbounded
Form 8900 Unbounded
Form 8902 Unbounded
Form 8903 1
Form 8904 Unbounded
Form 8906 Unbounded
Form 8907 Unbounded
Form 8908 Unbounded
Form 8909 Unbounded
Form 8910 Unbounded
Form 8911 Unbounded
Form 8912 Unbounded
Form 8913 Unbounded
Form T (Timber) Unbounded
90
Part X
MeF Section
For Form
990, 990EZ, 990PF,
1120POL, 8868
91
______________________________________________________________________
Extension Request for Forms 990, 990EZ, 990PF, 990T, 1041A, 4720, 5227
Form 8868, Application for Extension of Time to File an Exempt Organization Return,
MeF will accept electronic filings of Form 8868 (Part I – Automatic Extension) for the
following returns: Form 990, 990-EZ, 990-PF, 990-T (corporation), 990-T (sec. 401(a) or
408(a) trust), 990-T (trust other than above), 1041-A, 4720, and 5227. No signature is
required as part of this filing. However, a payment record may be attached to this form,
as appropriate, and if so, a signature is required for the Electronic Funds Withdrawal
(EFW) authorization. A Practitioner Pin (using Form 8879-EO) or Form 8453-EO may
be used for this authorization. Form 8453-EO is the only attachment/binary file that will
be accepted. An extension will be rejected if it is not received by the IRS due date of the
applicable return. (Note: For purposes of determining timeliness of the extension, the
received date is the electronic postmark, if present, or the IRS received date in the GTX
Key. To avoid rejecting extensions from filers or transmitters in a different time zone
from the IRS’ system, the time zone differences are taken into consideration.)
An accepted acknowledgement of the electronic Form 8868 serves as IRS approval of

the extension.
92
________________________________________________________________________________________________________
Tax Year 2006 Due Dates For Forms 990, 990EZ, 990PF, 990T, 1041A, 4720, 5227
When the 15th of the month falls on a weekend or holiday, IRS considers the return timely filed if postmarked by the next business
day. (Due Dates are always on the 15th of the month.)
Tax Period Tax Forms 990, Form 990-T Forms 990, Form 990-T Form 990-T Tax
Beginning & Period 990-EZ, 990- (sec. 401(a) 990-EZ, 990- (corporation) (sec. 401(a) Year of
Ending Dates PF, 990-T or 408(a) PF, 990-T or 408(a) Return
(trust other trust) (trust other 6 Month trust)
than above), than above) & Extension
4720 & 990-T Timely Filed 4720 Due Date 3 Month
(corporation) Due Date Extension
3 Month Due Date
Timely Filed Extension Due
Due Date Date
01/01/06—12/31/06 200612 05/15/07 04/17/07 08/15/07 11/15/07 07/15/07 2006

02/01/06—01/31/07 200701 06/15/07 05/15/07 09/15/07 12/15/07 08/15/07 2006
03/01/06—02/28/07 200702 07/16/07 06/15/07 10/15/07 01/15/08 09/15/07 2006
04/01/06—03/31/07 200703 08/15/07 07/16/07 11/15/07 02/15/08 10/15/07 2006
05/01/06—04/30/07 200704 09/17/07 08/15/07 12/15/07 03/17/08 11/15/07 2006
06/01/06—05/31/07 200705 10/15/07 09/17/07 01/15/08 04/15/08 12/15/07 2006
07/01/06—06/30/07 200706 11/15/07 10/15/07 02/15/08 05/15/08 01/15/08 2006
08/01/06—07/31/07 200707 12/17/07 11/15/07 03/15/08 06/16/08 02/15/08 2006
09/01/06—08/31/07 200708 01/15/08 12/17/07 04/15/08 07/15/08 03/17/08 2006
10/01/06—09/30/07 200709 02/15/08 01/15/08 05/15/08 08/15/08 04/15/08 2006
12/01/06—12/30/07 200710 03/17/08 02/15/08 06/15/08 09/15/08 05/15/08 2006
12/01/06—11/30/07 200711 04/15/08 03/17/08 07/15/08 10/15/08 06/16/08 2006
Note: Forms 1041-A and 5227 are calendar year returns and are due on April 16. The extended due date will be July 16.
93
______________________________________________________________________
Tax Year 2006 - Accepted Forms and Schedules for Exempt Organizations
The following chart identifies the forms and schedules accepted for Exempt
Organizations and the maximum number that may be submitted with each return.
Form 990 990-EZ 990-PF 1120-POL 8868

Form 990/990- 1 1 0 0 0
EZ, Schedule A
Form 990/990- 1 1 1 0 0
EZ/990-PF,
Schedule B
Form 1040, Unbounded Unbounded Unbounded 0 0
Schedule F
Form 1120, 0 0 0 1 0
Schedule D
Form 926 1,000 1,000 Unbounded 0 0
Form 970 1 1 0 0 0
Form 1118 0 0 0 Unbounded 0
Form 1118, 0 0 0 Unbounded 0
Schedule I
Form 1118, 0 0 0 1 0
Schedule J
Form 2220 0 0 1 0 0
Form 2439 Unbounded Unbounded Unbounded Unbounded 0
Form 3115 1 1 0 0 0
Form 3468 Unbounded Unbounded Unbounded 1 0
Form 3800 0 0 0 1 0
Form 4136 0 0 0 1 0
Form 4466 0 0 1 0 0
Form 4562 10,000 10,000 Unbounded Unbounded 0
Schedule J
Schedule M
Schedule O
Form 5884A Unbounded Unbounded Unbounded 0 0
Form 8271 1 1 Unbounded 0 0
Form 8275 1 1 Unbounded 0 0
Form 8275-R 1 1 Unbounded 0 0
94
Form 8609, Unbounded Unbounded Unbounded Unbounded 0
Schedule A
Schedule M
Schedule K-1
Schedule O
Schedule P
Form 8900 Unbounded Unbounded Unbounded Unbounded 0
Form 8903 0 0 0 1 0
Form 8913 0 0 0 1 0
Form T 100 100 Unbounded 0 0
95
Part XI
MeF Section
For Form 7004

______________________________________________________________________
Form 7004 Significant Changes
Form 1120-C extension type has been added to the Form 7004 for tax year
2006. See Form 7004 Instructions, What’s New, for information regarding filing
an extension for Form 990-C, Form 1120 (subchapter T cooperatives), and Form
1120-C.
The December 2006 revision of Form 7004 replaces the following extension
forms:
o Form 2758, Application for Extension of Time to File Certain

Excise, Income, Information, and Other Returns
o Form 7004, Application for Automatic 6-Month Extension of Time

To File Certain Business Income Tax, Information, and Other
Returns
o Form 8736, Application for Automatic Extension of Time to File U.S.

Return for a Partnership, REMIC, or for Certain Trusts
o Form 8800, Application for Additional Extension of Time to File U.S.

Return for a Partnership, REMIC, or for Certain Trusts
______________________________________________________________________
Form 7004 Application for Automatic 6-Month Extension of Time to File Certain
Business Income Tax, Information, and Other Returns
In tax year 2005, IRS granted an automated 6-month extension for the following
returns: Form 990-C, 1041, 1041-, 1041-QFT, 1042, 1065, 1065-B, 1066, 1120,
1120-A, 1120-C, 1120-F, 1120-FSC, 1120-H, 1120-L, 1120-ND, 1120-PC, 1120-
POL, 1120-REIT, 1120-RIC, 1120-S, 1120 (subchapter T cooperative), 1120-SF,
3520-A, 8804, 706-GS(T). Extension type for Form 1120-C has been added to
the Form 7004 for tax year 2006. See Form 7004 Instructions, What’s New, for
information regarding filing for an extension for Form 990-C, Form 1120
(subchapter T cooperatives), and Form 1120-C.
For these returns, the requirements for a signature and an explanation of the
need for an extension of time to file has also been removed. No notification will
be sent that an extension has been approved. Notification will only be sent if the
request for an extension is not allowed.
Only one extension form will need to be filed on or before the due date of the
appropriate form. A separate Form 7004 will need to be filed for each return. The
extension will apply only to the specific return identified on the Form 7004. See
the form instructions for specific information about consolidated group returns.
97
With the exception of the forms listed below in the Note, an extension request
may be filed electronically for most returns on the Modernizied e-File system.
All the returns shown on Form 7004 are eligible for an automatic 6-month
extension of time to file from the due date of the return. See the Form 7004
instructions for exceptions pertaining to foreign corporations with no office or
place of business in the United States and for foreign and certain domestic
corporations and for certain partnerships.
Generally, Form 7004 must be filed on or before the due date of the applicable
tax return. The due dates of the returns can be found in the instructions for the
applicable return; as well as the Due Date Chart for Form 7004 as referenced in
this Publication.
The Form 7004 does not extend the time for payment of tax. Refer to the Form
7004 Instructions for additional information on payment of tax and balance due.
Note: Form 7004 cannot be filed electronically for the following: Forms
8612, 8613, 8725, 8831, 8876, or 706-GS (D), instead a paper extension must
be mailed to the IRS.
98
______________________________________________________________________
Tax Year 2006 Extension Due Dates For Specific Form Types
Form 7004 - Tax Period 200612 only - Form 706-GS (T)
Form Extension Due Date Extended Return

Due Date
706-GS(T) 04/17/07 10/15/07
Note: Form 706GS (T) return is due April 15th of the year following the calendar year in
which the termination occurred.
______________________________________________________________________
Form 7004 - Tax Period 200612 only – Form 1042
Form Extension Due Date Extended Return

Due Date
1042 03/15/07 09/15/07
Note: Form 1042 return is due on or before March 15th of each year
______________________________________________________________________
Form 7004 Due Dates – Form 1120 series (not 1120-C), and Form 3520-A
Tax Period Extension Due Extension Due Extended Return

Date Date for Filing Due Date
Under Reg Sec
1.6081-5
200612 03/15/07 06/15/07 09/17/07
200701 04/17/07 07/16/07 10/15/07
200702 05/15/07 08/15/07 11/15/07
200703 06/15/07 09/17/07 12/17/07
200704 07/16/07 10/15/07 01/15/08
200705 08/15/07 11/15/07 02/15/08
200706 09/17/07 12/17/07 03/17/08
200707 10/15/07 01/15/08 04/15/08
200708 11/15/07 02/15/08 05/15/08
200709 12/17/07 03/17/08 06/16/08
200710 01/15/08 04/15/08 07/15/08
200711 02/15/08 05/15/08 08/15/08
______________________________________________________________________
99
Form 7004 Due Dates - Form 990C, Form 1120 (subchapter T cooperative), and
Form 1120-C
Tax Period Extension Due Date Extended Return Due

(15th day of the 9th Date
month following the
end of the tax period)
200612 09/17/07 03/17/08
200701 10/15/07 04/15/08
200702 11/15/07 05/15/08
200703 12/17/07 06/16/08
200704 01/15/08 07/15/08
200705 02/15/08 08/15/08
200706 03/17/08 09/15/08
200707 04/15/08 10/15/08
200708 05/15/08 11/17/08
200709 06/16/08 12/15/08
200710 07/15/08 01/15/09
200711 08/15/08 02/17/09
______________________________________________________________________
Form 7004 Due Dates - Forms 1041 (estate & trust), 1041-QFT, 1041-N, 1065,
1065-B, & 1066
Form Extension Due Date Extended Return Due

Date
200612 04/17/07 10/15/07
200701 05/15/07 11/15/07
200702 06/15/07 12/17/07
200703 07/16/07 01/15/08
200704 08/15/07 02/15/08
200705 09/17/07 03/17/08
200706 10/15/07 04/15/08
200707 11/15/07 05/15/08
200708 12/17/07 06/16/08
200709 01/15/08 07/15/08
200710 02/15/05 08/15/08
200711 03/17/08 09/15/08
______________________________________________________________________
100
Part XII
e-file Information for Large Taxpayers
(Corporations, Partnerships and
Tax Exempt Organizations)
______________________________________________________________________
101
Corporations, partnerships and tax exempt organizations who are e-filing their own
return (whether required to by Treasury regulation or who wish to e-file voluntarily) need
to closely follow the instructions below. Although you are not considered an Electronic
Return Originator, you will need to follow certain procedures that EROs, Transmitters,
etc. follow to e-file your return. The steps for Large Taxpayers are:
1. Prepare your return using IRS-approved software that has all the forms and
schedules you need to file
2. Check your return to make sure it will be accepted by IRS
3. Transmit your return to IRS
“Large Taxpayer” Provider Option
It is important to understand the differences in the e-file Application process for

required/voluntary corporations versus those who want to e-file in a profit mode. First,
whether you are a corporation that is required to e-file or one that wants to e-file
voluntarily, you will be selecting a Provider Option of “Large Taxpayer”. When you do
this, you will notice that the Application automatically defaults your organization to a “not
for profit” status. That does not mean your corporation is not for profit; it only means
you are e-filing with IRS in a “not for profit” mode. Corporations or individuals who
apply to the e-file Program who are responsible for transmitting thousands of returns to
IRS are e-filing “for profit.” As a “not for profit” e-filer, you
(1) do not have to undergo suitability checks required of firms e-filing for profit
(i.e., suitability checks are not performed on the Responsible Officials or
Delegated Users of the corporation) and
(2) will be assigned both an Electronic Filing Identification Number (EFIN) and an
Electronic Transmitter Identification Number (ETIN) on the completion of your e-
file Application. As mentioned previously, if you elect Option 3, you will need
your own EFIN and for Option 4, your own EFIN and ETIN.
Preparing Your Return
Most corporations have been using software to prepare their return for years. Whether
you prepare your own return or have a third-party tax professional prepare it, you need
to ensure that the software you are purchasing has all the forms and schedules that you
need to file.
Tax software developers must be Authorized IRS e-file Providers – companies or

individuals who have registered with e-Services and have applied and been accepted
into the e-file program as software developers. They undergo a suitability check and
must test all the software products they are offering. Many forms change from year to
year, so each year software developers must test their software products with IRS’
Acceptance Testing System (ATS). Please note that passing ATS means that the
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software has met IRS requirements for electronic business returns. It does not mean
that a software package includes every possible schedule or attachment or that it will
meet the needs of all filers. You should choose your software based on your own
corporate, tax exempt or partnership return needs. Those software developers who
have passed ATS for Tax Year 2006 can be found on irs.gov at the following sites:
Form List of Authorized IRS e-file Providers

1120/1120-S http://www.irs.gov/efile/lists/0,,id=119096,00.html
1065/1065-B http://www.irs.gov/efile/lists/0,,id=100940,00.html
990, 990-EZ, 990-PF & 1120-POL http://www.irs.gov/efile/lists/0,,id=119598,00.html
With the requirement to e-file, the challenge will be to integrate all of the supporting
data, transactional data, elections, disclosure statements and other items with your
return. The following section discusses how to handle such things as dependencies,
foreign addresses and other items that may concern you.
Integrating Data/Elections into Your Return
As stated previously, with the requirement to e-file, the challenge will be to integrate all
of the supporting data, transactional data, elections, disclosure statements and other
items you normally compile to send with your return. These documents can be
prepared in a variety of software packages and, with paper filing, you would just attach
the document to your return. This Section discusses how to handle these attachments
in your electronic return. Complete instructions for all forms and potential attachments
are contained in Publication 4163 (Modernized e-File Information for Authorized IRS e-
file Providers of Forms 1120/1120-S) and on irs.gov at http://www.irs.gov.
Remember that you need to select a tax preparation software that meets all your
corporation’s return needs. IRS requires all tax preparation software from Software
Developers used for preparing electronic returns to pass the requirements for MeF
Assurance Testing (ATS) as briefly explained below:
1. IRS issues publications that have a series of test tax returns and instructions
(see the section “Process to Transmit Your Own Return).
2. Software vendors notify IRS that they plan to test and provide a list of forms they
plan to include in their tax preparation software.
Note: IRS does not require software vendors to support all forms! They are
allowed to develop their tax preparation software based on the needs of their
clients. The test returns issued by IRS also do not include all forms or schedules
that can be part of an actual return! Please check with your software vendor on
the availability of the forms/schedules you need to e-file your return!
3. Software vendors use the test tax returns to create test returns in the specified
XML format.
4. The software vendor transmits the XML formatted test tax returns to IRS.
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5. An IRS tax examiner checks every data entry field on the return.
a. These checks ensure tax calculations on the test return matches the
answers provided by IRS on the test returns.
b. These checks also ensure the software correctly formats the test tax
return data in XML format and the data can be successfully transmitted to,
received and the tax return viewed by IRS.
6. When IRS determines the software correctly performs all required functions, that
software is approved for electronic filing.
7. After approval from IRS is received, software vendors are allowed to market their
tax preparation software to corporations and/or professionals as “approved for
electronic filing”.
When taxpayers prepare paper consolidated corporate income tax returns,

spreadsheets are commonly used to report the required data for each subsidiary.
These spreadsheets are commonly used to report subsidiary data on Form 1120, other
attached IRS forms such as Form 4562, and for supporting data (other income
statement). These spreadsheets are attached to the consolidated return and mailed to
IRS.
MeF requires tax preparation software approved for electronic filing to use IRS forms for
reporting data for each subsidiary return. In addition to the parent return, tax preparation
software approved for electronic filing should allow taxpayers to create a separate
“stacked return” for each subsidiary. Tax preparation software should allow taxpayers
to report Eliminations and Adjustments as a separate “stacked return”. Tax
preparation software may also allow taxpayers to use spreadsheets for the internal
review of the return, but IRS requires all subsidiary data to be formatted, transmitted
and viewed by IRS as “stacked returns”.
Taxpayers use tax preparation software to prepare most of their paper corporate
income tax return but may use other formats (Word, Excel, etc) to prepare supporting
data. The documents containing supporting data are then attached to the portion of the
return prepared by tax preparation software and mailed to IRS.
MeF requires supporting data to be included in tax preparation software or attached as

scanned PDF files. IRS reviewed all of the forms (and instructions) that may be
attached to Form 1120 and/or 1120-S and identified every instance where taxpayers are
required to attach supporting data. IRS provided structured formats to software
developers or provided instructions to enter supporting data as PDF files (in instances
where IRS has not defined a format). Software developers are required to use these
formats for developing tax preparation software approved by IRS for electronic filing. It
is the responsibility of software vendors to provide appropriate instructions for taxpayers
to enter supporting data to meet the IRS guidelines. Most software vendors will allow
taxpayers to import/export data from other sources. Taxpayers are encouraged to
discuss available options with their software vendor early to determine how to prepare
supporting data.
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Check Your Return
Checking your e-file return involves running diagnostics that are built into the software.
In most cases, this just involves following the instructions provided in the software you
purchased. IRS provides all the business rules and XML schema requirements for each
form and schedule to the software developers to build into their software. For example,
a business rule for the Form 1120 is:
If Form 1120, Checkbox A2 “Personal Holding Company” is checked, then

Schedule PH (Form 1120) must be attached.
When the return is transmitted to IRS, each of the business rules and XML schema
requirements are checked. If there are no errors, the return is accepted. If the return
fails any of the business rules or schema requirements, the transmitter receives an
acknowledgement with the error description. If you are using a third-party Transmitter,
they will call you if they need your input to correct the error.
Transmitting Your Return
The IRS requires each electronic return to have both an Electronic Filing Identification
Number (EFIN) and an Electronic Transmitter Identification Number (ETIN). The EFIN
is IRS’ authorization for an organization/entity to e-file. The ETIN is IRS’ authorization
for an organization/entity to transmit returns directly to IRS.
You can either use a third-party tax professional or you can transmit your return to the
IRS yourself. The following describes each of these options and how the EFIN and
ETIN are provided for each option:
Use a third-party tax professional

There are basically three options if you choose to use a third-party tax
professional to transmit your return:
1. Using an Online Provider (has an EFIN and ETIN)

2. Using an Electronic Return Originator(ERO)/Transmitter (has an
EFIN and ETIN)
3. Using a Transmitter (has an ETIN; you must provide the EFIN)
Transmit your return yourself (you need your own EFIN and ETIN)
The next section provides the steps involved for each of these transmission methods.
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Methods to Transmit Your Returns
Using a Third-Party Tax Professional

For any third-party tax professional you choose, ensure that they are Authorized IRS e-
file Providers. These are companies or individuals who have registered with e-Services
and have applied and been accepted into the e-file program. They are considered “for
profit” entities and must have passed suitability and been accepted by IRS to e-file
individual or business income tax returns. In Section 3, we provided the links to
Authorized IRS e-file Providers who have passed testing. In their description of the
services they provide, they should have indicated whether they are Online Providers,
ERO/Transmitters or only Transmitters. You need to check with the vendor to ensure
they offer the type of transmission services you want.
Online Providers are Authorized IRS e-file Providers who have created software
and tested it with IRS. They have both an EFIN and an ETIN. You purchase their
software (online, from a distributor or direct from the Online Provider) and complete
your return. You then contact the Online Provider when you are ready to e-file your
return. The Online Provider checks the return using their software diagnostics.
Once the return has passed all diagnostics, the Online Provider inserts their EFIN
and ETIN in the return’s transmission header (information that IRS needs) and
transmits it directly to IRS.
Electronic Return Originators (ERO) and Transmitters are also Authorized IRS
e-file Providers who check your return to ensure it will pass the software diagnostics
and insert their EFIN and ETIN in the return’s transmission header. You purchase
the appropriate business tax software, complete your return and provide it to the
ERO/Transmitter. They check your return to ensure it is in the correct format, etc.
and then transmit your return directly to IRS. Not all EROs are Transmitters, so you
need to ensure that your selected company is both an ERO and a Transmitter.
A Transmitter is also an Authorized IRS e-file Provider who can transmit your return
directly to IRS. You may want to check with your selected software vendor, as most
have elected to become Transmitters. They have their own ETIN, but you will need
to provide your own EFIN if you select this option. You purchase the appropriate
business tax software, register with e-Services and create your corporation’s e-file
Application to obtain your own EFIN. You will provide your completed return and
your EFIN to your selected Transmitter. Your Transmitter will use their own ETIN to
transmit your return to IRS. Instructions on registering with e-Services and creating
your corporation’s e-file Application are shown in Section 5 (Registration and e-file
Application)
Transmitting your own return(s)

You will need your own EFIN and ETIN if you select this option. You purchase the
appropriate business tax software, register with e-Services and create your
corporation’s e-file Application to obtain your own EFIN and ETIN. You will need to
designate someone in your corporation to be your Internet Transmitter on your e-file
Application. You will complete your return and provide it to your corporation’s
designated Internet Transmitter. Before transmitting your official return, they will
perform a communications test with IRS to ensure connectivity between your system
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and that of IRS. Once you have successfully passed this connectivity test, your Internet
Transmitter will insert your EFIN and ETIN in the transmission header and transmit your
return directly to IRS. Again, instructions on registering with e-Services and creating
your corporation’s e-file Application are shown in Section 5 (Registration and e-file
Application). Section 6 (What’s the process to transmit my own return?) has detailed
information on performing your communications test and a link to IRS Publications 4162
and 4164 that provide instructions on transmitting your own return.
The following chart provides a quick overview of the transmission options discussed
above and whether you will need an EFIN or ETIN to e-file:
Transmission Option Large Large

Taxpayer Taxpayer
Needs Their Needs Their
Own EFIN? Own ETIN?
Online Provider NO NO
Electronic Return Originator (ERO)/Transmitter NO NO
Transmitter YES NO
Large Taxpayer Transmits Return YES YES
Transmission Channels
As you designate the types of forms you will transmit (1120/1120-S, 1065-1065-B, 990,
etc.), you will need to select the transmission channel you will use. There are currently
three transmission channels, but
It is important to become familiar with the rules and requirements for participation in IRS
e-file by reading the applicable IRS e-file documents. Publications and other
information about IRS e-file and related topics, including state filing information, can be
found on the IRS web site at www.irs.gov and are also included in a later section of this
document. If you are experiencing problems as you create your e-file Application, you
can also call the IRS’ e-Help Desk toll-free at 1-866-255-0654 for assistance. Make
sure you let them know that you are a corporation who is creating an e-file Application
with the “Large Taxpayer” Provider Option. Publication 3112 (Application and
Participation in IRS e-file) describes the e-file Application process, but keep in mind that
as a Provider Option of “Large Taxpayer”, you are not subject to the information on the
suitability checks.
Just as a reminder, when you are in e-Services, you are in a secure environment. Do
not use your browser “back” or “forward” arrows! Use the navigation buttons at the
bottom of every screen to navigate!
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Process to Transmit Your Returns
As referenced earlier, you will need to follow instructions in this section if you have
decided to transmit your own return to IRS. The process includes:
1. Selecting your transmission channel

2. Ensuring your ETIN is in “Test” status
3. Performing a communications test with the IRS
4. Having your ETIN changed to “Production” status
5. Transmitting your return to the IRS
You have already registered, created your e-file Application and been assigned an EFIN
and ETIN. Now you need to determine which transmission channel you will be using
to transmit your return to the IRS:
1. Internet Filing Application (IFA)

2. Application-to-Application (A2A)
IFA is a direct, secure internet connection that requires a person to initiate the
transmission session. IRS developed IFA specifically for large returns of over 500
pages, which applies to most Large Taxpayer returns. IFA provides a browser-based
interface that allows an individual the ability to easily upload a return and transmit it
securely over the internet. A test of IFA by IRS allowed a 50,000 page return to be
transmitted to IRS in approximately 15 minutes! The speed at which your return goes
over the Internet is, of course, dependent on the speed that is provided through your
corporation’s Internet Service Provider (ISP) (e.g., dial-up will be slower than a direct
service link). For Tax Year 2006 (process year 2007), IFA supports Federal/State filing.
A2A is a “system-to-system” connection that requires a web services connection to

have been established. IRS developed A2A as an option for transmitters sending large
volumes of transmissions and want to develop a “lights out” operation (i.e., you don’t
need a person to be there to do the actual transmission). To use A2A, you must
complete a manual enrollment of your system. You will also need to enable Web
Services. A2A was the only transmission option that supported Federal/State filing for
Tax Year 2005 (processing year 2006) but as shown above, for Tax Year 2006, both
IFA and A2A support this option. There is also the requirement to perform the
communications test with this transmission channel.
As identified in the e-file Application procedures in Section 5, you must designate one
(or more) of your Responsible Officials/Delegated Users as your Internet Transmitter
(it is always a good idea to have a back-up person designated).
Prior to transmitting your official return to the IRS, your Internet Transmitter will need to
perform a communications test (a “handshake” with the IRS) to ensure that you can
communicate with the IRS when you are ready to transmit your return. Most software
packages (IRS accepted e-file software) have communication tests built in so that
completing this communications test is relatively easy. Follow the directions in the
software or documentation package. If you have problems, you should contact the
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software developer who sold you the software or contact the technical support operation
that comes with the software package. You will use a test EIN and your assigned EFIN
and ETIN along with the test returns provided in your software. Prior to conducting the
test, call the IRS’ e-Help Desk (1-866-255-0654). They will monitor your communication
and, when you pass, change your ETIN from “test” to “production” status. Refer to
Publication 4162 (Modernized e-File Test Package for Forms 1120/1120S), for
complete instructions on performing a communications test.
The ETIN provided on your e-file Application is tied to the forms that you have indicated
you are going to transmit. If you access your e-file Application, you can ensure that
your ETIN is in a “Test Status” (click on the “ETIN Status” link in your e-file Application
menu list. The “Status” column on the ETIN table should indicate “Test Status”. . If it is
in the “Production Status” mode, the first test return you transmit to IRS will become
your official return! st. To ensure that it is, access your e-file Application and If it says
“Production”, you cannot change this yourself – you will need to call the IRS’ e-Help
Desk at 1-866-255-0654 and have them change your ETIN status to “Test”.The test
status of each form transmitted to the IRS can be viewed by accessing the firm’s IRS e-
file Application and clicking on the “FORMS” link. The form/format previously selected
on your IRS e-file Application will be displayed in a table along with the status. The
status is updated from “test” to “production” when required communication testing is
completed. For more information regarding communication testing, refer to the test
publications:
• Publication 4162 (Modernized e-File Test Package for Forms 1120/1120-S)
• Publication 4505 (Modernized e-File Test Package for Forms 1065/1065-B)
• Publication 4205 (Modernized e-File Test Package for Exempt Organization

Filings)
The Delegated User will access IFA through the e-Services MeF login screen (MeF
Internet Filing) and transmit your return directly to IRS. They will also need to come
back in to pick up the acknowledgement after IRS provides it.
The following is the screen your Internet Transmitter will see when they log in to
conduct the communications test, as well as when your return is ready to be transmitted
“in production” (official submission of your return to the IRS):
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When an IFA transmission is complete, a GTX key is generated immediately indicating
the transmission to IRS was successful. It is very important to print or capture the
screen shot that contains your GTX key. The next step is for MeF to validate the
transmission file and the electronic returns and generate an Acknowledgement File
which is the official notification that the electronic return was Accepted (no errors) or
Rejected (errors identified). If the electronic return is rejected the Acknowledgment File
will contain an Error Code Explanation(s) that can be used to identify and correct errors.
IRS makes the Acknowledgment File available for the Transmitter to “pick up” as soon
as MeF processing is completed. (Remember, if you use a third party to transmit your
return to IRS, the third party transmitter is responsible for retrieving the
Acknowledgment File from IRS and making the file available to the Large Taxpayer.)
MeF requires tax preparation software to create a “Hash” or “Check Sum” which counts
each byte of electronic tax return data and includes this total in the transmission file sent
to IRS. When IRS receives the transmission file, one of the first steps of processing the
electronic return is to count the bytes received. The Acknowledgment File will contain
the incoming hash (Embedded CRC32) and the IRS computed hash (Computed
CRC32) along with the Taxable Income amount and the Total Tax amount.
Just as with IFA, when an A2A transmission is complete, a receipt is immediately

generated indicating the transmission to IRS was successful. The next step is for MeF
to validate the transmission file and the electronic returns and generate an
Acknowledgement File which is the official notification that the electronic return was
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Accepted (no errors) or Rejected (errors identified). If the electronic return is rejected
the Acknowledgment File will contain an Error Code Explanation(s) that can be used to
identify and correct errors. IRS makes the Acknowledgment File available for the
Transmitter to “pick up” as soon as MeF processing is completed.
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____________________________________________________
Exhibits
______________________________________
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EXHIBIT 1
Business Name Controls
The following Business Name Control rules and examples are provided to assist you in
the preparation of the corporation tax return.
If after reading this section you still cannot determine your business name control, you
may contact the e-Help Desk at 1-866-255-0654.
Business Name Control General Information:
¾ The Name Control consists of up to four alpha and/or numeric characters; hypen
and ampersand are allowable characters.
¾ The Name Control should be determined from the information specified on the
first name line. Generally, the Name Control is derived from the first four
characters of the corporation name.
¾ The ampersand (&) and hyphen (-) are the only special characters allowed in the
Name Control.
¾ The Name Control can have less, but no more than four characters. Blanks may
be present only at the end of the Name Control.
¾ Note: Do not include ''dba'' as part of the Name Control. The acronym stands for
''doing business as’.
Business Name Control Valid Characters:
¾ Numeric (0- 9)
¾ Alpha (A-Z)
¾ Hyphen (-),
¾ Ampersand (&)
Business Name Control Special Rule:
¾ If an invalid character is used in the name line, drop the special character from
the taxpayer's name. Example: 4U.com. The Name Control should be “4UCO”.
Examples:
Name Control Underlined Name Control Rule
Sumac Field Plow Inc. SUMA Derive the Name Control
11TH Street Inc. 11TH from the first four
P & P Company P&PC significant characters of
Y-Z Drive Co Y-ZD the corporation name.
ZZZ Club ZZZC
Palm Catalpa Ltd. PALM
Fir Homeowners Assn. FIRH
The Willow Co. WILL When determining a

The Hawthorn THEH corporation name control,
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omit “The” when it is
followed by more than
one word. Include the
word “The” when it is
followed by only one
word.
John Hackberry PA John If a business name
Sam Sycamore SC SAMS contains any of the
Carl Eucalyptus M.D.P.A. CARL following abbreviations,
treat as the business
name of a corporation:
PC – Professional
Corporation
SC – Small Corporation
PA –Professional
Association
PS --Professional Service
The Joseph Holly Fund JOSE Apply Name Control rules
The Joseph Holly Foundation JOSE when the organization
Kathryn Fir Memorial Fdn. KATH name contains “Fund”,
“Foundation” or “Fdn”.
City of Fort Hickory Board CITY Apply the Name Control
Walnut County Employees WALN rules to chapter names of
Association national fraternal
Rho Alpha Chapter Alpha Tau RHOA organizations.
Fraternity
House Assn. of Beta XI Chapter HOUS
of Omicron Delta Kappa
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EXHIBIT 2
Forms and Attachment Listing

____________________________________________________________________________________
Click on this link to access Forms/Statements allowed as attachments to Form

1120/1120-S.
http://www.irs.gov//taxpros/providers/article/0,,id=97626,00.html/
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EXHIBIT 3
______________________________________________________________________
Foreign Country Codes__________________________________________________
This table provides acceptable foreign country codes. If a foreign country is not listed
use “XX”.
Country Foreign Country

Code
AA Aruba
AC Antigua & Barbuda
AE United Arab Emirates
AF Afghanistan
AG Algeria
AJ Azerbaijan
AL Albania
AM Armenia
AN Andorra
AO Angola
AR Argentina
AS Australia
AT Ashmore & Cartier Is
AU Austria
AV Anguilla
AX Akrotiri Base Area
AY Antarctica
BA Bahrain
BB Barbados
BC Botswana
BD Bermuda
BE Belgium
BF The Bahamas
BG Bangladesh
BH Belize
BK Bosnia-Herzegovina
BL Bolivia
BM Burma
BN Benin
BO Belarus
BP Solomon Islands
BQ Navassa Island
BR Brazil
BS Bassas da India
BT Bhutan
BU Bulgaria
BV Bouvet Island
BX Brunei
BY Burundi
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Code
CA Canada
CB Cambodia
CD Chad
CE Sri Lanka
CF Republic of Congo
CG Dem Rep of Congo (Kinshasa)
CH China
CI Chile
CJ Cayman Islands
CK Cocos Island
CM Cameroon
CN Comoros
CO Columbia
CR Coral Sea Islands Territory
CS Costa Rica
CT Central African Republic
CU Cuba
CV Cape Verde
CW Cook Islands
CY Cyprus
DA Denmark
DJ Djibouti
DO Dominica
DQ Jarvis Island
DR Dominican Republic
DX Dhekelia Base Area
EC Ecuador
EG Egypt
EI Ireland
EK Equatorial Guinea
EN Estonia
ER Eritrea
ES El Salvador
ET Ethiopia
EU Europa Island
EZ Czech Republic
FG French Guiana
FI Finland
FJ Fiji
FK Falkland Islands
FO Faroe Islands
FP French Polynesia
FQ Baker Island
FR France
FS Antarctic Lands
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Code
FS Fr Southern & Antarctic Lands
GA The Gambia
GB Gabon
GG Georgia
GH Ghana
GI Gibraltar
GJ Grenada
GK Guernsey
GL Greenland
GM Germany
GO Glorioso Islands
GP Guadeloupe
GR Greece
GT Guatemala
GV Guinea
GY Guyana
GZ Gaza Strip
HA Haiti
HK Hong Kong
HM Heard Island & McDonald Island
HO Honduras
HQ Howland Island
HR Croatia
HU Hungary
IC Iceland
ID Indonesia
IM Isle of Man
IN India
IO British Indian Ocean Territory
IP Clipperton Islands
IR Iran
IS Israel
IT Italy
IV Cote d’Ivoire
IZ Iraq
JA Japan
JE Jersey
JM Jamaica
JN Jan Mayen
JO Jordan
JQ Johnston Atoll
JU Juan de Nova Island
KE Kenya
KG Kyrgyzstan
KN Dem People’s Rep of Korea
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Code
KQ Kingman Reef
KR Kiribati
KS Republic of Korea
KS South Korea
KT Christmas Island
KU Kuwait
KZ Kazakhstan
LA Laos
LE Lebanon
LG Latvia
LH Lithuania
LI Liberia
LO Slovakia
LQ Palmyra Atoll
LS Liechtenstein
LT Lesotho
LU Luxembourg
LY Libya
MA Madagascar
MB Martinique
MC Macau
MD Moldova
MF Mayotte
MG Mongolia
MH Montserrat
MI Malawi
MJ Montenegro
MK Macedonia
ML Mali
MN Monaco
MO Morocco
MP Mauritius
MQ Midway Islands
MR Mauritania
MT Malta
MU Oman
MV Maldives
MX Mexico
MY Malaysia
MZ Mozambique
NC New Caledonia
NE Niue
NF Norfolk Island
NG Niger
NH Vanuatu
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Code
NI Nigeria
NL The Netherlands
NO Norway
NP Nepal
NR Nauru
NS Suriname
NT Netherlands Antilles
NU Nicaragua
NZ New Zealand
PA Paraguay
PC Pitcairn Islands
PE Peru
PF Paracel Islands
PG Spratly Islands
PK Pakistan
PL Poland
PM Panama
PO Portugal
PP Papua New Guinea
PU Guinea-Bissau
QA Qatar
RB Serbia
RE Reunion
RO Romania
RP Philippines
RS Russia
RW Rwanda
SA Saudi Arabia
SB St Pierre & Miquelon
SC Nevis
SC St Kitts & Nevis
SE Seychelles
SF South Africa
SG Senegal
SH St Helena
SI Slovenia
SL Sierra Leone
SM San Marino
SN Singapore
SO Somalia
SP Spain
ST St Lucia
SU Sudan
SV Svalbard
SW Sweden
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Code
SX S Georgia Island & S Sandwich Island
SY Syria
SZ Switzerland
TD Trinidad and Tobago
TE Tromelin Island
TH Thailand
TI Tajikistan
TK Caicos Islands
TK Turks & Caicos Islands
TL Tokelau
TN Tonga
TO Togo
TP Sao Tome and Principe
TS Tunisia
TT East Timor
TU Turkey
TV Tuvalu
TW Taiwan
TX Turkmenistan
TZ Tanzania
UG Uganda
UK United Kingdom
UP Ukraine
UV Burkina Faso
UY Uruguay
UZ Uzbekistan
VC Grenadines
VC St Vincent & Grenadines
VE Venezuela
VI British Virgin Islands
VM Vietnam
VT Vatican City
WA Namibia
WE West Bank
WF Wallis and Futuna
WI Western Sahara
WQ Wake Island
WS Western Samoa
WZ Swaziland
XA Ascension
XC Channel Islands
XE England
XI Aland Island
XM Myanmar
XN Northern Ireland
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Code
XR Slovak Republic
XS Scotland
XT Tristan Da Cunha
XW Wales
XX Other (country not identified elsewhere)
XY Canary Islands
XZ Azores
YI Yugoslavia
YM Yemen
ZA Zambia
ZI Zimbabwe
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EXHIBIT 4
Standard Street Address Abbreviations
Word Abbreviation
Air Force Base AFB
and &
Alley ALY
Annex ANX
Avenue AVE
Beach BCH
Boulevard BLVD
Branch BR
Bridge BRG
Brook BRK
Building BLDG
Bypass BYP
Camp CP
Care Of, %
or In Care Of
Center CTR
Circle CIR
Corner COR
Corners CORS
Court CT
Courts CTS
Creek CRK
Crossing XING
Drive DR
East E
Estates EST
Extension EXT
Expressway EXPY
Falls FLS
Forest FRST
Fork FRK
Forks FRKS
Fort FT
Freeway FWY
Gardens GDNS
General Delivery GEN DEL
Grove GRV
Harbor HBR
Haven HVN
Heights HTS
Highway HWY
123
EXHIBIT 4—Standard Street Address Abbreviations Continued
Word Abbreviation
Highway Carrier HC
Island IS
Islands ISS
Junction JCT
Lake LK
Lakes LKS
Lane LN
Lodge LDG
Manor MNR
Meadows MDWS
Mount MT
Mountain MTN
North N
Northeast NE
Northwest NW
One-fourth,* 1/4
One-Quarter*
One-half* 1/2
(*All fractions-space after
prior number-for example:
1012 1/2. St. )
Parkway PKY
Place PL
Plaza PLZ
Point PT
Port PRT
P.O.-Box No. PO BOX
River RIV
Road RD
Rural Route RR
Shore SHR
Shores SHRS
South S
Southeast SE
Southwest SW
Square SQ
Station STA
Street ST
Summit SMT
Terrace TER
Trail TRL
Trailer TRLR
Turnpike TPKE
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EXHIBIT 4—Standard Street Address Abbreviations Continued
Word Abbreviation
Union UN
Valley VLY
Village VLG
Vista VIS
West W
Note: Plurals for street, road, avenue, etc. should be abbreviated

by adding “s” to the abbreviation. For example; STS, RDS, AVES, etc.
125
EXHIBIT 5
Valid ZIP Codes
STANDARD POSTAL SERVICE STATE ABBREVIATIONS AND ZIP CODES
State Abbr. ZIP Code
Alabama AL 350nn-369nn
Alaska AK 995nn-999nn
Arizona AZ 850nn, 852nn-853nn, 855nn-857nn,859nn-
860nn,863nn-865nn
Arkansas AR 716nn-729nn
California CA 900nn-908nn, 910nn-928nn, 930nn-961nn
Colorado CO 800nn-816nn
Connecticut CT 060nn-069nn
Delaware DE 197nn-199nn
District of Columbia DC 200nn, 202nn-205nn, 569nn
Florida FL 320nn-339nn, 341nn-342nn,
344nn, 346nn-347nn, 349nn
Georgia GA 300nn-319nn, 39815, 399nn
Hawaii HI 967nn, 968nn
Idaho ID 832nn-838nn
Illinois IL 600nn-620nn, 622nn-629nn
Indiana IN 460nn-479nn
Iowa IA 500nn-516nn, 520nn-528nn
Kansas KS 660nn-662nn, 664nn,679nn
Kentucky KY 400nn-427nn
Louisiana LA 700nn-701nn, 703nn-708nn, 710nn-714nn
Maine ME 039nn-049nn
Maryland MD 206nn-212nn, 214nn-219nn
Massachusetts MA 010nn-027nn, 055nn
Michigan MI 480nn-499nn
Minnesota MN 550nn-551nn, 553nn-567nn
Mississippi MS 386nn-397nn
Missouri MO 630nn-631nn, 633nn-641nn, 644nn-658nn
Montana MT 590nn-599nn
Nebraska NE 680nn-681nn, 683nn-693nn
Nevada NV 889nn-891nn, 893nn-895nn, 897nn-898nn
New Hampshire NH 030nn-038nn
New Jersey NJ 070nn-089nn
New Mexico NM 870nn-871nn, 873nn-875nn, 877nn-884nn
New York NY 005nn, 063nn, 100nn-149nn
North Carolina NC 270nn-289nn
North Dakota ND 580nn-588nn
Ohio OH 430nn-459nn
Oklahoma OK 730nn-731nn, 734nn-741nn, 743nn-749nn
126
EXHIBIT 5 - Valid ZIP Codes Continued
State Abbr. ZIP Code

Oregon OR 970nn-979nn
Pennsylvania PA 150nn-196nn
Rhode Island RI 028nn, 029nn
South Carolina SC 290nn-299nn
South Dakota SD 570nn-577nn
Tennessee TN 370nn-385nn
Texas TX 733nn, 750nn-770nn, 772nn-799nn
Utah UT 840nn-847nn
Vermont VT 050nn-054nn, 056nn-059nn
Virginia VA 201nn, 220nn-246nn
Washington WA 980nn-986nn, 988nn-994nn
West Virginia WV 247nn-268nn
Wisconsin WI 530nn-532nn, 534nn-535nn, 537nn-549nn
Wyoming WY 820nn-831nn, 834nn
STANDARD POSTAL SERVICE STATE ABBREVIATIONS AND ZIP CODES FOR

U.S.POSSESSIONS
U.S. Possession Abbr. ZIP Code
American Samoa AS 96799

Federated States of Micronesia FM 969nn
Guam GU 9691n
Marshall Islands MH 969nn
Commonwealth of the MP 969nn
Northern Mariana Islands
Palau PW 969nn
Puerto Rico PR 006nn, 007nn, 009nn
U.S. Virgin Islands VI 008nn
Corporate and Exempt Organization returns with addresses in the American

Possessions are considered to have domestic addresses for processing purposes. The
return filer address must contain a state abbreviation to be treated as an American
Possession.
127
APO/FPO CITY/STATE/ZIP CODES FOR MILITARY OVERSEAS ADDRESSES
City State ZIP Code

APO or FPO AA 340nn
APO or FPO AE 090nn-098nn
APO or FPO AP 962nn-966nn
128
EXHIBIT 6
North American Industry Classification System (NAICS)

(Codes for Principal Business Activity) for use when filing Form 1120/1120A
129
130
131
EXHIBIT 7
______________________________________________________________________
Business Rules________________________________________________________
The schema validation business rules can be found on the irs.gov website as follows:
o For 1120/1120-S/7004 -
http://www.irs.gov/taxpros/providers/article/0,,id=97626,00.html.
o For 11065/1065-B -
http://www.irs.gov/efile/article/0,,id=153999,00.html
o For 990/990-EZ/990-PF/1120-POL/8868
http://www.irs.gov/charities/article/0,,id=105955,00.html
132

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Modernized e-File (MeF)

Information for Authorized

IRS e-file Providers

Tax Year 2006

Cat. No. 36165C

Provide America’s taxpayers top quality service

Part I – Introduction Page

Overview of Modernized e-File (MeF) 8

Benefits of IRS e-file 9

Publications for Tax and Information Returns 10

Request for Publications 11

IRS Services Phone List 14

The IRS Website 15

Application to Participate in the IRS e-file Program 16

Part II – Processing Year 2007 Information

Highlights of Tax Year 2006, Processing Year 2007 18

Amended and Superceded Corporate Returns 23

Return/Extension Due Date Charts 24

Returns Not Eligible For Mef 25

MeF Fed/State Program 28

Safeguarding of Modernized e-File from Fraud and Abuse 32

Returns Filed Through Modernized e-File 33

Submitting a Timely Filed Electronic Tax Return 35

Disclosure of Tax Return Information 35

Paperwork Reduction Act Notice 37

Obtaining, Handling, and Processing Return Information From Taxpayers 37

Safeguarding Modernized e-File From Fraud and Abuse 38

Part IV – Procedures for Electronic Return Originators of Corporate

Be Careful With Addresses 40

Balance Due Returns 43

Electronic Funds Withdrawal 43

Credit Card Payments 44

Electronic Federal Tax Payment System (EFTPS) 45

Signing an Electronic Tax Return 46

Scanned 8453 Option 48

Elections That Require Separate Signatures 48

Special Instructions When Attaching Binary Files 48

Special Instrucitons for Form 8865 48

Avoiding Refund Delays 48

Submitting the Electronic Return to the IRS 49

Record Keeping and Documentation Requirements 49

Providing Information to the Taxpayer 50

Acknowledgements of Transmitted Return Data 50

Resubmission of Rejected Extensions 51

Transmission Perfection Period For Corporate Returns 51

Part V – Procedures for Transmitters of Corporate MeF Returns

Additonal Transmitters Responsibilities for On-Line Providers 57

Part VI – Procedures other Authorized IRS e-file Providers

Intermediate Service Providers 61

Part VII – Guidelines For Tansition From Paper to Electronic Filing

Transition From Paper to Electronic Filing 64

Preparing Supporting Data Required by IRS Forms or Form Instructions 64

Creating Elections Required by Forms or Form Instructions 69

Creating Elections/Disclosure Statements Required by Regulations or 69

Preparing elections That Require Supporting Data 71

Part VIII – MeF Section for Forms 1120/1120-S

Forms Attached to For 1120/1120-S with Separate Signatures 73

Signing an Electronic Return 74

Special Instructions When Copies of Original Forms are Required Prior to 74

Special Instructions for Form 1120 , Line 32f Credits 75

Publication 3112, IRS e-file Application and Participation - contains information

Publication 4162, Modernized e-File Test Package for Forms 1120/1120-S -

Publication 4205, Modernized e-File Test Package for Exempt Organization

Publication 4505, Modernized e-File Test Package for Forms 1065/1065-B –

Tax Year 2006 – Temporary Treasury Regulation Section 301.6011-5T,

Short Period Returns (Corporate and Partnership Returns Only). If a short

Final Period Returns (Corporate, Partnership and Exempt Organization

Form 1065, U.S. Return of Partnership Income

Form 1065-B, U.S. Return of Income for Electing Large Partnerships