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4 - Erroneous AbatementThe timely filed TC 150 return for TY 2018 is determined to be a nullity. The valid taxpayer filed a return reporting tax of $.00 and withholding of $2,500 which posted as a TC 976. Form 14039 is included with the return. The ASED for the valid return is expired. Based on the original return, the account shows TC 150 tax of $5,000, and withholding of $6,000. A CP 2000 proposing a tax increase of $2,000 based on unreported income is issued to the valid taxpayer’s last known

Note:

Internal Revenue Manual Part 25. Special Topics · 2026-10-03 edition · updated 2026-10-04 · United States

If a TC 534 is present and an adjustment is required because the valid taxpayer filed a return or there are credits to address, prepare and email Form 4442 using the subject line: CSED Expired with TC 534 (or similar) to ITVA HQ.

When the invalid return does not meet streamline criteria, refer to the scenarios below to determine if the invalid return needs to be moved to an IRSN.

When the module is not in retention, the invalid return will be moved to an IRSN after the CSED has expired when the valid taxpayer has filed a return that must be processed.

When the valid taxpayer has not filed a return, the invalid return will not be moved to an IRSN after the CSED has expired. Refer to IRM 25.23.4.11.3, Action Required if Not Moving Specific Year Account Information.

When an account is in balance due status as of the CSED expiration, a TC 608 will systemically credit the account, bringing the balance to zero. In situations where there is an impact, (i.e., a current year refund was offset to a prior year, levy payments, etc.), and the IDT allegation has been confirmed, credits must be resolved following normal procedures. Addressing these credits will create a balance due. As a result, the TC 608 will reset systemically.

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▸Contents — Internal Revenue Manual Part 25. Special Topics
Internal Revenue Manual Part 25. Special Topics

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