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Often delinquent filers and non-filers will find that their tax returns have been filed for them. These are called Substitutes For Return (SFR) or as they are sometimes called "Service Filed Returns." A taxpayer would have been given official notice of this action at the last known address. These SFR returns often lack the information a taxpayer would have included on a filed return. The tax calculation on a SFR return is usually the highest it could be, plus penalties and interest. The amount due on these returns, usually, can not be satisfied through bankruptcy. Even if the tax has been paid by the taxpayer or through offsets and levies, a return must be filed. If the tax is adjusted and a refund is due, the three year forfeiture rule for refunds will apply. Most States have a similar process, often called Notice of Proposed Assessments (NPA). While the title of the document may change, the effect is the same as with the Internal Revenue Service. There are taxes, penalties and interest due. The State of California has two additional charges; a demand penalty and a collection fee. Most states as well as the IRS will abate (forgive) some of the penalties for reasonable cause ( a good reason).
SFR's are createed under the ASFR system: ASFR System Overview Automated Substitute for Return is an IRS-developed National Standard Application written in XXXXX and currently installed XXXXXXXXXXXXXXX. ASFR is a batch-processing application that performs complex computations and tax calculations enabling tax examiners to issue accurate notices and assessments based on IRP information and to resolve return delinquency cases on individual taxpayers. Currently, cases of delinquent modules are received in ASFR from the Integrated Data Retrieval System (IDRS). The data is then transmitted to the XXXXXXXXXX via File Transfer Protocol (FTP) from XXXXXXXXXXXXXX. When funding is available ASFR will be XXXXXX XXXXXXXXXXXXXXXX
A. Taxpayer Data: Compilation of all data available on any individual type of tax return, to include Taxpayer’s name, address, phone number, Taxpayer’s Social Security Account Number, Tax Owed, and Taxpayer Income B. Employee Data: Employee Name (First, middle, last), Employee Identification Number (EIN). C. Audit Trail Information: Password associated with the EIN D. Other: ASFR does not contain other data or files. 2. Describe/identify which data elements are obtained from files, databases, individuals, or any other sources. A. IRS - All above information. B & C. Taxpayer & Employee - Information will be collected from taxpayers if the taxpayer responds or files a return. All other ASFR information is in the form of extracts from current IRS databases. ASFR only processes Individual Master File (IMF) cases, no Business Master File (BMF) cases. Information about payers of income is from IRS files. It is not received from other sources.
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April 15, 2008 TraderStatus™, TradersTaxPlan™, TradersAdvantage™, TraderStatus.com™, TradersTaxPlan.com™, TradersAdvantage.com™, DoYourOwnDaytraderTaxes™, DoYourOwnTaxes™, DoingYourOwnTaxes™, DoYourOwnDaytraderTaxes.com™, DoYourOwnTaxes.com™, DoingYourOwnTaxes.com™, DoYourTaxesOnline™, DoYourOwnTaxesOnline™, DoYourTaxesOnline.com™, and DoYourOwnTaxesOnline.com™ are trademarks and service marks of Colin M. Cody, CPA and TraderStatus.com, LLC, Trumbull Connecticut Copyright© 2004 & 2005 Colin M. Cody, CPA and TraderStatus.com, LLC, All Rights Reserved |