CP 162E Adjustment of Previously Assessed Penalty Even Balance Form 1065, Form 1066 or…

The CP 162E was developed to more clearly explain adjustments to previously assessed penalties in lieu of issuing a CP 210/220 adjustment notice when the resulting module balance will be between $1.00 credit and $4.99 debit.

An adjustment of the previously assessed penalties in the table below will generate a CP 162E:

MFT/Form

With a

And a resulting Module Balance between

MFT 02 & TC 150 doc code = 16 (Form 1120-S), MFT 06 (Form 1065 or 1065-B), or MFT 07 (Form 1066)

TC 29X/TC 30X manual or systemic adjustment to TC 161

$1.00 credit and $4.99 debit

MFT 02 & TC 150 doc code = 16 (Form 1120-S), MFT 06 (Form 1065 or 1065-B),or MFT 07 (Form 1066)

TC 24X with PRN 722 manual or systemic adjustment in current cycle with or without PRN 688 adjusted in current cycle

$1.00 credit and $4.99 debit

MFT 02 & TC 150 doc code = 16 (Form 1120-S) or MFT 06 (Form 1065 or 1065-B)

TC 24X with PRN 723 manual or systemic adjustment in current cycle with or without PRN 688

$1.00 credit and $4.99 debit

For more information on the specific penalties being abated see IRM 3.14.2.6.10.1, CP 162 Failure to File Electronic Partnership Return, IRM 3.14.2.6.10.2, CP 162A Failure to File Form 1065, Form 1066 or Form 1120-S General Review Procedures, and IRM 3.14.2.6.10.3, CP 162B Missing Information on Form 1065 and Form 1120-S General Review Procedures.

Follow general review procedures in IRM 3.14.2.6 to determine the timeliness of the return.

Research the module and return if the return is available, to verify the return received date and the notice information in Control D and OLNR matches IDRS for base penalty amount, adjustment amount, and module balance.