SEC. 20. SPECIFICATIONS FOR

OCR SCANNABLE APPLICATION FORMS FOR EMPLOYEE PLANS

.01 Forms 4461, 4461–A, 4461–B, 5300, 5303, 5307, 5310, 5310–A, and 6406 are OCR scannable documents submitted to key district offices for employee plans matters. They may be submitted as Computer-generated substitute forms if the requirements of this section are satisfied.

.02 An OCR data sheet must be generated according to the following requirements:

1 Set at least 1� margin at top, bottom, and both sides.

2 A data element consists of a less than sign, information or at least 5 blank spaces, and a greater than sign (delimiters). All data elements from page one of the application forms in .01 above must be printed on the OCR data sheet, even if no information is entered between the delimiters.

3 Add at least 2 spaces before and after each delimiter.

4 Each data element must start at the left margin.

5 One line for each data field, except employer and plan name fields may be two lines. However, only one set of delimiters may bracket the field, even if the field is on two lines.

6 Each data element must appear on the OCR data sheet in the same sequence as printed on the preprinted form, reading top to bottom and from left to right.

7 Each data field must be sequentially numbered at left commencing with

1. See Notice 90–38 for examples of the acceptable format.

8 The data sheet must be printed on 8 ¹ ⁄2� X 11� white nonrecycled paper suitable for use with printing equipment and duplicating machines. A photocopy is not acceptable. Heavyweight bond paper and onion skin paper are not acceptable.

9 Use 10 pitch type in a standard business font (e.g., courier, elite, pica).

10 Add at least two spaces before and after each less than and greater than sign (delimiters).

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U.S. Persons With Respect To Certain Foreign Corporations, and their accompanying Schedules J, M, N, and O, and Forms 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged In a U.S. Trade or Business (Under Sections 6038A and 6038C of the Internal Revenue Code).

1 Paper and Computer-Generated Substitutes for Form 5471 and the accompanying Schedules J, M, N, and O, and Form 5472 that totally conform to the specifications contained in this procedure may be privately printed, but must have prior approval and are subject to annual review from the Internal Revenue Service.

2 Copies of the official forms for the reporting year may be obtained from most Service offices. The Service provides only cut sheets of these forms. Continuous fan-folded/pin-fed forms are not provided.

3 The Service will accept QUALITY substitute tax forms that are consistent with the official forms they represent, AND that do not have an adverse impact on our processing. Therefore, only those substitute forms that conform to, and do not deviate from the corresponding official forms, are acceptable.

.02 Computer-Prepared Tax Forms If the substitute returns and schedules meet the guidelines prescribed herein, the Service will for filing purposes accept computer-prepared Forms 5471 and 5472 filled in by a computer, word processing equipment or similar automated equipment or a combination of computer-prepared/generated and filled in information, filed separately or attached to individual or business income tax returns.

.03 Format Arrangement 1 The substitute must follow the design of the official form as to format, arrangement, item caption, line numbers, line references, and sequence. It must be an exact textual and graphic MIRROR image of the official form for it to be acceptable.

2 The filer must use one of the official ten character amount formats. All entries in the amount column should have a decimal point following the whole dollar amounts whether or not the vertical line that separates the dollars from the cents is present. It must follow a consistent format.

3 The reference code must be printed to the left of the corresponding captioned line and also immediately preceding the data entry field EVEN if there is

no reference code preceding the data entry field on the official form. The reference code that is immediately before the data field must either be followed by a period or enclosed in parentheses. There also must be at least two blank spaces between the period or the right parenthesis and the first digit of the data field.

4 The size of the page must be the same as the official form (8 ¹ ⁄2� X 11�).

5 The acceptable print is ‘‘Helvetica’’.

6 The spacing of the print must be 6 lines/inch vertical, 10 or 12 print characters per inch horizontally.

7 A 1⁄2 to 1⁄4 inch margin must be maintained across the top, bottom, and both sides (exclusive of any pin feed holes).

8 The substitute form must be of the same number of pages as the official one.

9 The preprinted brackets in the money fields should be retained.

10 The filer must COMPLETELY fill in all the specified numbers or referenced lines as they appear on the official form, (not just totals), BEFORE attaching any supporting statement.

11 Supporting statements are NEVER to be used until the required official form they support are first totally filled in (completed). A blank or incomplete form that refers to a supporting statement, in lieu of completing a tax return is unacceptable.

12 Descriptions for captions, lines, etc., appearing in the substitute forms may be limited to one print line by using abbreviations and contractions, and by omitting articles, prepositions, etc. However, sufficient key words must be retained to permit ready identification of the caption, line or item.

13 Text prescribed for the official form, which is solely instructional in nature, e.g., ‘‘Attach this schedule to Form 1040’’, ‘‘See instructions,’’ etc., may be omitted from the form.

.04 Filing Instructions Instructions for filing substitute forms are the same as for filing official forms.