Reminder:

A secondary TC 290 .00 will not be input when a TC 150 return has not been received. Refer to IRM 25.23.4.3.1, CII and IDRS Case Controls, for additional information.

When EIP 3 was issued to the invalid taxpayer via direct deposit, input TC 971 AC 850 to flip future refunds to paper. Post delay adjustments, as needed.

When EIP 3 was computed based on a valid return (or benefits when an exception applies) but was issued to the invalid taxpayer due to direct deposit information being updated, take the following actions:

Input TC 971 AC 850.

Adjust the account to remove the EIP. Input TC 290 .00 with BS 05, SC 0, the appropriate CRN(s) and amount(s), RC(s), and HC 4. Post delay this adjustment by 1 cycle.

Input a second TC 290 .00 with BS 05, SC 0, HC 3, and RC 139. Post delay this adjustment by 2 cycles.

Follow procedures in IRM 25.25.4.6, Reversing Identity Theft (IDT) Lost Refunds, to resolve EIPs issued to the invalid taxpayer.

For cases that meet streamline criteria for the tax year EIP 3 was based on, follow the procedures outlined in the table below according to the determination you have made:

Determination for the Tax Year used for EIP 3 Eligibility

Valid Taxpayer

Tax Year 2021 Module and Entity Actions

(1)

One return IDT

Invalid/Valid

Invalid/Invalid

Did receive EIP 3 (in whole or part)

If the invalid taxpayer received a portion of EIP 3, reduce the amount of EIP 3 on the module to reflect the exact amount of EIP 3 received by the valid taxpayer. Input TC 290 .00 with BS 05, SC 0, the appropriate CRN(s) and amount(s), RC(s), and HC 4. If TC 971 AC 850 was input, post delay the adjustment by 1 cycle.

Input TC 290 .00 with BS 05, SC 0, RC 139, and HC 3 (4 if issuing a manual refund). Post delay this adjustment by 1 cycle (2 cycles if TC 971 AC 850 was input).

Follow procedures in IRM 25.25.4.6, Reversing Identity Theft (IDT) Lost Refunds, to resolve the EIP 3 payment issued to the invalid taxpayer.

See paragraph (7) below for letter requirements.

(2)

One return IDT

Invalid/Valid

Invalid/Invalid

Did not receive any portion of EIP 3

Adjust the account to remove the EIP 3. Input TC 290 .00 with BS 05, SC 0, the appropriate CRN(s) and amount(s), RC(s), and HC 4. If TC 971 AC 850 was input, post delay this adjustment by 1 cycle.

Input TC 290 .00 with BS 05, SC 0, RC 139, and HC 3 (4 if issuing a manual refund). Post delay this adjustment by 1 cycle (2 cycles if TC 971 AC 850 was input).

Follow procedures in IRM 25.25.4.6, Reversing Identity Theft (IDT) Lost Refunds, to resolve the EIP 3 payment issued to the invalid taxpayer.

See paragraph (7) below for letter requirements.