Identifying IRC 965 Elections and Payments

It is important to identify cases that have IRC 965 inclusion, so account and notice actions are correct. Applicable MFTs for IRC 965(h) elections are only applicable to MFTs 02, 05, 06, 34 and 44. IRC 965(i) elections are only applicable to MFT 05.

All taxpayers with IRC 965 inclusion and deferred taxes must attach Form 965-A, Individual Report of Net 965 Tax Liability, or Form 965-B, Corporate and Real Estate Investment Trust (REIT) Report of Net 965 Tax Liability and Electing REIT Report of 965 Amounts, as applicable to their tax return every year until all deferred tax liability has been paid in full.

IRC 965 notices should be worked by leads or experienced personnel. NRPS selects these notices with keys 016 and 050. See IRM 3.14.2.6.5.4, IRC 965 CP Notices, for more information.

Many cases that have IRC 965 impact do not have keys 016 and 050. Oftentimes, due to misapplied IRC 965 payments a case will be selected by NRPS as a refund transcript or a payment discrepancy notice. This causes non-inclusion year modules to be overpaid or have payment discrepancies.

For BMF returns and modules with an IRC 965 inclusion, there will be a CCC J present on BRTVU Response Screen R1 and/or TRBDV Codes Response Screen. View Computer Condition Codes on the TXMODA response screen in the Posted Return Information section.