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3.28.3 
Individual Income Tax Returns

3.28.3.1 
(01-01-2009)
Introduction

  1. This section of the Internal Revenue Manual (IRM) provides instructions for processing:

    • The tax returns and accounts of the President and Vice President of the United States of America

    • Blind trust individual income tax returns for Presidential appointees

  2. These procedures apply to all functions within the campuses.

  3. The tax returns of the President and Vice President will be mailed to the Field Director, Austin Submission Processing Campus.

  4. The Field Director of Austin can delegate the “walk through”
    processing of the President and Vice Presidents returns to a subordinate. This person should make sure that the original
    returns are not unnecessarily folded or bent, and the edit marks and stamps are neatly placed on the returns, since they will
    remain permanent documents in the National Archives.

  5. The tax returns of the Presidential appointees with income in a “Blind Trust”
    can be filed at the respective campus, based on the “Where to File”
    Instructions for Form 1040.

  6. The President, Vice President, or any Presidential appointee who has placed their assets in a Blind Trust must request permission
    in writing to permit an Agent to prepare and file their return. This Request letter is sent to the Field Director of any Submission
    Processing (SP) Campus. The Field Director will respond with an automatic Approval letter. The Approval letter must be attached to the return, when filed. See Exhibit 3.28.3-1 for a SAMPLE copy of an Approval letter. Route a copy of the Approval letter to Headquarters (HQ) Analyst to keep on file.

  7. The President, Vice President, or any political appointee who moves their assets into a Blind Trust, must also submit a Form 2848, Power of Attorney. The Agent or taxpayer can mail or fax the Form 2848 to any Centralized Authorization File (CAF) Unit prior to filing the
    tax return. If received by any CAF Unit, other than Ogden, the unit will route to Ogden for processing. If the Form 2848 is
    attached to the return, the Code and Edit Tax Examiner who is in receipt of the return will contact the Ogden CAF Unit and
    fax the completed Form 2848 to them for processing to the CAF.

3.28.3.2 
(01-01-2009)
Processing Returns and Accounts of the President and Vice President

  1. Follow the instructions in this subsection of the manual when processing the tax returns and accounts of the President and
    Vice President of the United States.

  2. The instructions include the following procedures:

    • Individual and Gift Tax Returns Processing

    • Account Data Storage and Access

    • Document Perfection Procedures

    • Mandatory Examination

3.28.3.2.1 
(01-01-2010)
Tax Return Processing

  1. Follow the normal Returns Processing procedures for all tax returns of the President and Vice President of the United States.

  2. Monitor the location of the tax returns of the President and Vice President at all times during processing.

    • Ensure that the returns are not exposed to viewing by other employees in your immediate area;

    • Keep the returns locked in a secure drawer or cabinet while you are away from your work area and the returns are still under
      your control.

  3. Once the return has posted, make a photocopy of the return and stamp “COPY”
    in the top margin. Route to Files.

  4. The original processed income tax returns will be “hand delivered”
    to:


    Internal Revenue Service
    Deputy Commissioner for Services and Enforcement
    1111 Constitution Ave NW, Room 3000 IR
    Washington, DC 20224
    Attention: Dianne Grant
     

  5. Handle any Gift Tax return of the President or Vice President in accordance with the same procedures applicable to all taxpayers.

    Note:

    Enclose each of the processed Form 1040 tax returns in double-sealed envelopes to prevent any damage to the original returns.

3.28.3.2.2 
(01-01-2008)
Account Data

  1. Carry the account data of the President and Vice President on the appropriate Master File.

  2. Do not subject the accounts to restricted access procedures.

3.28.3.2.3 
(01-01-2009)
Mandatory Examination

  1. Individual Income Tax returns for the President and Vice President are subject to mandatory examinations. See IRM 4.2.1.8.

  2. Copies of the returns to be examined will be transmitted by the Office of the Deputy Commissioner for Services and Enforcement
    to the Small Business/Self Employed (SB/SE) Director of Examination.

  3. The SB/SE Director of Examination will determine the area office responsible for the examination of the return. The transmittal
    memorandum will contain the following directions:

    1. Regardless of the Discriminant Index Function (DIF) score, the returns will be examined.

    2. IRS personnel, including specialists, will be assigned to the examination as appropriate.

    3. The Examination Area Director, or his/her designee, will arrange for contact with the authorized representatives of the President
      and Vice President for the beginning of the examination.

    4. All relevant Internal Revenue Manual (IRM) procedures will apply to these return examinations.

    5. The copies of the tax returns, any related examined returns, and the work papers and examination reports will be subject to
      regular filing and retention procedures.

3.28.3.3 
(01-01-2009)
Blind Trust Form 1040 Returns

  1. Follow the instructions in this subsection of the manual when processing Blind Trust individual Income Tax returns.

  2. The instructions included in this subsection of the manual include the following procedures:

    • General Information and Instructions

    • Tax Return Processing

    • Document Perfection Procedures

    • Accounts Management (CAF) Procedures – Processing the Form 2848

3.28.3.3.1 
(01-01-2009)
General Information and Instructions

  1. The President, Vice President and a Presidential appointee will be considered to have shown good cause for receiving permission—and
    will automatically be granted permission—to have their return filed by a Trustee when both of the following conditions are
    met:

    1. The President, Vice President, or appointee has an interest in a Blind Trust that meets the requirements of 202(f)(4)(B) of
      the Ethics in Government Act of 1978

    2. The President, Vice President, or appointee requests permission in writing, to the Field Director of any Submission Processing
      Campus for his/her federal income tax return to be filed by the Trustee of the Blind Trust in accord with Rev. Proc. 80–59
      as supplemented by Notice 2003–19.

    Note:

    A separate request must be made for each Tax Year (Tax Period).

  2. The Submission Processing Campus Field Director will approve the Request on behalf of the IRS. The original Request will be
    returned to the taxpayer along with the Approval letter by the Submission Processing Campus Field Director. See Exhibit 3.28.3-1.

  3. Taxpayers who are granted permission to have the return filed by a Trustee will be requested to have the Trustee attach both of the following to their filed return:

    • A copy of the Approval letter

    • A valid Power of Attorney (POA) for the Trustee, unless previously submitted to a CAF Unit

  4. The IRS must use extreme caution not to violate a Blind Trust.

    1. All correspondence and refunds concerning the Blind Trust tax return will be addressed to the authorized Trustee.

    2. No disclosure of any information regarding the source(s) or nature of the Blind Trust income will be made to the taxpayer.

  5. Generally, the taxpayers name will be in the Entity, but the address will belong to the Trustee to ensure that any correspondence
    and/or refund is mailed only to the Trustee. Any attached POA should be reviewed for completeness using the criteria in IRM
    3.28.3.3.2.1 by the Code and Edit Tax Examiner, then faxed to the Ogden CAF Unit to be posted.

  6. Do not disclose information regarding the source of the Blind Trust income if contact with the taxpayer is ever required.

3.28.3.3.2 
(01-01-2009)
Tax Return Processing

  1. Blind Trust returns can generally be identified by the presence of any of the following:

    • The notation “Blind Trust”
      in the signature area, or

    • An Income Statement or schedule indicating “Income from Blind Trust”
      , or

    • A trust Agreement which specifies “Blind Trust”
      , or

    • A POA attached indicating “Blind Trust”
      , or posted to the CAF with a Blind Trust Authorization Indicator, or

    • An Approval letter signed by any SP Campus Field Director. See Exhibit 3.28.3-1.

  2. The Approval letter must be attached to the return, and the POA must be either attached to the return, or already posted to
    the CAF with the Blind Trust Authorization Indicator. If the Form 2848 is attached to the return, it is the responsibility
    of the Code and Edit Tax Examiner to determine that it is complete before routing it to the Ogden CAF Unit. If the POA is
    already posted, the Code and Edit Tax Examiner should ensure that the Blind Trust Authorization Indicator is posted on the
    account. See IRM 3.28.3.3.2.1.

  3. If the Form 2848 is an original, or the CAF needs to be updated with the Blind Trust Indicator, the Code and Edit Tax Examiner
    will call the Ogden CAF Unit Manager to alert him/her that they are faxing a Power of Attorney for a “Blind Trust”
    to the Unit. Edit “Blind Trust”
    in the top margin of the Form 2848. Fax the original Form 2848 to the Ogden CAF Unit, then staple the Form 2848 to the
    back of the return. See IRM 3.28.3.3.2.1(3) for specific procedures to perfect the Form 2848.

  4. If Approval letter is attached and POA is posted correctly, continue processing the return. Leave the Approval letter (and
    any POA) attached to the return.

  5. If the POA is posted to the CAF, but the Blind Trust Indicator needs updating, refer to IRM 3.28.3.3.2.1(6) for instructions
    on how to contact the Ogden CAF Unit to update that field.

3.28.3.3.2.1 
(01-01-2009)
Document Perfection Procedures

  1. Determine that the Approval letter signed by a Submission Processing Campus Field Director is present, and POA is either posted
    or attached, when “Blind Trust”
    is indicated on a return of a political appointee.

    Note:

    The POA authorization may be contained in the Trust Agreement when a Blind Trust Agreement is attached. If all of the items, including the specific acts, are listed in the Trust Agreement, then it is acceptable. Edit the Taxpayers
    Name and Social Security Number (SSN), and “See Attached”
    on a Form 2848. Then, fax the “Form 2848″
    package to the Ogden CAF Unit for processing.

  2. If a Form 2848 is attached, check Command Code CFINK to determine if it is an original or copy of the POA. If the CAF is up to date (including Blind Trust Authorization Indicator), then continue processing the return
    and leave the copy of the Form 2848 attached to the return.

  3. If an original Form 2848 (POA) is attached to the return, the Code and Edit Tax Examiner will edit “BLIND TRUST”
     in the top-center margin of the POA and ensure that the applicable parts of the POA are completed.

    1. Taxpayer Name(s) and address, SSN(s) – Line 1

    2. Representative(s) Name(s) and Address, CAF No., Phone No. – Line 2

    3. Type of Tax (Individual), Tax Form (1040), Tax Period (must be only ONE Tax Period) – Line 3

    4. Specific Use – Line 4 box should be checked and the following statement should be written on Line 5 granting the Trustee permission to sign the tax return. “This power
      of attorney is being filed pursuant to Regulation section 1.6012-1(a)(5), which requires a power of attorney to be attached
      to a return if a return is signed by an agent by reason of specific permission granted by IRS”
      .

    5. Sign the return – Statement shown above should be on Line 5

    6. Execute a waiver of restriction on assessment or collection – Must be specified on Line 5

    7. Execute a waiver of notice of disallowance – Must be specified on Line 5

    8. Execute a consent to extend the period for assessment or collection – Must be specified on Line 5

    9. Execute a closing agreement – Must be specified on Line 5

    10. Receive—but not endorse—a refund check – Line 6 must be initialed by the Taxpayer and the Representative must sign.

    11. Notices or Communication – Line 7 can be Blank or box a checked.

    12. Revocation – If Line 8 box is checked, research CC CFINK to determine if it should have been checked.

    13. Signature of Taxpayer(s) and Date – Line 9 is required.

    14. Designation, Jurisdiction, Signature, and Date of Agent – Part II is required. For this one, correspond with the agent if this is missing.

  4. If the POA is complete:

    1. Detach the POA from the return and call the Ogden CAF Unit Manager to notify him/her that you are faxing the Blind Trust POA
      for “expedite”
      processing.

    2. Fax the original POA to the Ogden CAF unit.

    3. Upon acknowledgement of receipt from the Ogden CAF Unit Manager that the POA was input correctly to the CAF, staple the
      Form 2848 to the back of the return and continue processing.

    Note:

    In addition to the Form 2848, also leave the Submission Processing Campus Field Directors Approval letter attached to the
    return.

  5. Correspond with the taxpayer (Presidential appointee) for the missing items, or authorizations when the POA does not grant
    the Trustee authority to perform all of the specific acts (Line 5 on Form 2848) on behalf of the Presidential appointee, or
    any other required items are missing, except Part II. If Part II is incomplete, correspond with the Trustee/Agent.

  6. The Approval letter signed by a SP Campus Field Director and POA must be present. If either one is missing or incomplete, use the table below to determine the proper action:

    If a POA is: and Approval Letter is: Then:
    Attached, or already correctly posted on the CAF with the Blind Trust Authorization Indicator Attached Continue processing.
    On the CAF, but the Blind Trust AuthorizationIndicator is not present Attached Contact the Ogden CAF Unit Manager. Fax the Approval letter to them for verification to allow the update to the CAF with the
    Blind Trust Indicator.
    Not found on the CAF, or attached to the return Attached Correspond with the Trustee (POA) for the missing POA.
    SSPND the return while corresponding for the missing POA.
    Attached, or already posted on the CAF Not attached Correspond with the Trustee (POA) for a copy of the Approval letter.
    Not found on the CAF, or attached to the return Not attached There is an indication of “Blind Trust”
    . The SP Campus Field Director (or designee) should contact the HQ Analyst. The Analyst will maintain a file copy of all
    Approval letters. If there is no Approval letter on file, then Code and Edit should correspond for a Form 2848 if another
    person signed the return.

  7. If the Approval letter signed by a SP Campus Field Director is attached, a valid POA has posted, and other correspondence
    conditions are present on the return, suspend the return and correspond with the Trustee (POA).

3.28.3.3.2.2 
(01-01-2009)
Accounts Management (CAF) Procedures – Processing the POA

  1. The Form 2848 (POA) for the “Blind Trust”
    can be mailed or faxed directly to any CAF unit by the Agent or Taxpayer. If any CAF Unit, other than Ogden, receives a Form 2848 (POA) with indication
    of “Blind Trust”
    , they should contact the Ogden CAF Unit Manager, and fax the Form 2848 directly to him/her for processing.

  2. When the Form 2848 (POA) is attached to a Blind Trust tax return, the Code and Edit Tax Examiner will review the Form for completeness, then phone the Ogden CAF
    Unit Manager and immediately fax the Form 2848 to them for input to the CAF. The CAF Unit Manager will acknowledge receipt
    and input the Form 2848. After input to the CAF, the Code and Edit Tax Examiner will continue processing the return.

  3. Ogden CAF Unit Only – Process the Blind Trust POA according to instructions. in IRM 21.3.7.9.12, Blind Trust Authorizations.

Exhibit 3.28.3-1 
(01-01-2009)
Approval Letter – Sample Copy

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