Elective Payment Election (EPE) Account and Notice Impact

IRA of 2022, IRC 6417(d)(4) provides that the EPE is treated as having been made on the later of the due date (determined without regard to extensions) of the return of tax for the taxable year or the date on which such return is filed. In other words, EPE is treated as having been made on the latest of the return due date (RDD), extended return due date (XRDD) or disaster due date (DDD) on an original return for the taxable year. Therefore, all refunds including an EPE in excess of total tax, cannot be released before the RDD of the tax return claiming the EPE.

Tax returns filed before the RDD that include "refundable" EPE will be held with a C- freeze until the due date of the return.

EPE is disallowed for late filed returns. If the taxpayer is claiming EPE on a late filed return, a systemic math error notice will be issued to the taxpayer. These notices will only be selected for review if the notice also contains a TPNC 90.

Notices with EPE can be identified in NRPS with EPE at the top of the notice record and in OLNR with notice status type of "Q" . The systemic paragraph is not visible in OLNR or on the NRPS quick print.

The only disposition available for these notices is retype. Entity information and the addition of a label, if necessary, will need to be edited using retype disposition.