SECTION 12. MONITORING AND

SUSPENSION OF AN ON-LINE FILER

.01 The Service will monitor an OnLine Filer for conformity with this revenue procedure. The Service can immediately suspend, without notice, an On-Line Filer from the On-Line Filing Program. However, in most circumstances, a suspension from participation in the On-Line Filing Program is effective as of the date of the

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letter informing the On-Line Filer of the suspension. Before suspending an On-Line Filer, the Service may issue a warning letter that describes specific corrective action for deviations from this revenue procedure.

.02 If a Principal or Responsible Official is suspended from the On-Line Filing Program, every entity that listed the suspended Principal or Responsible Official on its Form 8633 may also be suspended.

.03 The Service will monitor the timely receipt of Forms 8453–OL, as well as their overall legibility (especially the recording of the DCN).

.04 The Service will monitor the quality of an On-Line Filer’s transmissions throughout the filing season. The Service will also monitor electronic returns and tabulate rejections, errors, and other defects. If quality deteriorates, the On-Line Filer will receive a warning from the Service.

.05 The Service will monitor complaints about an On-Line Filer and issue a warning or suspension letter as appropriate.

.06 The Service reserves the right to suspend the electronic filing privilege of any On-Line Filer that violates any provision of this revenue procedure. Generally, the Service will advise a suspended On-Line Filer concerning the requirements for reacceptance into the On-Line Filing Program. The following reasons may lead to a warning letter and/or suspension of an On-Line Filer from the On-Line Filing Program (this list is not all-inclusive):

(1) the reasons listed in section 4.11 of this revenue procedure; (2) deterioration in the format of individual transmissions;

(3) unacceptable cumulative error or rejection rate;

(4) stockpiling returns at any time while participating in the On-Line Filing Program;

(5) failure on the part of a Transmitter to retrieve acknowledgement files within two work days of transmission by the Service;

(6) failure on the part of a Transmitter to notify the taxpayer, as prescribed in section 5.17 of this revenue procedure, of the status of a transmitted return within two work days of receipt of the acknowledgement files from the Service;

(7) failure on the part of a Transmitter to batch and send Forms 8453–

OL to the Austin Service Center on a weekly basis;

(8) significant complaints about an On-Line Filer;

(9) failure on the part of an OnLine Filer to ensure that no other entity uses its EFIN and/or ETIN;

(10) having more than one EFIN for the same business entity at the same location (the business entity is generally the entity that reports on its return the income derived from electronic filing), unless the Service has issued more than one EFIN to a business entity.

(11) failure on the part of an OnLine Filer to cooperate with the Service’s efforts to investigate electronic filing abuse;

(12) violation of the advertising standards described in section 11 of this revenue procedure;

(13) failure to maintain and make available records as described in section 5.19 of this revenue procedure;

(14) failure to supply a taxpayer with an accurate DCN;

(15) failure to give effective instructions to a taxpayer concerning the entry of the DCN on Form 8453-OL;

(16) failure to timely pay any applicable fees, as implemented by subsequent guidance; or

(17) failure to timely submit a revised Form 8633 notifying the Service of changes described in section 4.03 of this revenue procedure.

.08 The Service will list in the Internal Revenue Bulletin, district office listings, district office newsletters, and on the EFS Bulletin Board the name and owner(s) of any entity suspended from the On-Line Filing Program and the effective date of the suspension.

.09 Denials of applications and suspensions of participation in the OnLine Filing Program will result in:

(1) a rejected applicant not being reconsidered for participation in the On-Line Filing Program for at least two years; and

(2) a suspended On-Line Filer not being reconsidered for participation in the On-Line Filing Program for at least two years. For purposes of this section 12.09, two years means the remaining months in the calendar year of denial of participation or suspension and the following two calendar years.