SECTION 7. ACH DEBIT ENTRY

.01 If a taxpayer chooses the A C H credit entry payment option to make an FTD or FTP, the taxpayer may use any financial institution capable of originating an ACH credit entry.

.02 For each TIN used by a taxpayer in making an FTD or FTP by an ACH credit entry, the taxpayer should request that its financial institution originate a prenotification ACH credit. See section 3.13 of this revenue procedure. The taxpayer’s financial institution should not originate an ACH credit entry until the financial institution has successfully completed the prenotification process. A prenotification ACH credit will verify the taxpayer information in the T X P addenda record, thereby minimizing the possibility that an ACH credit entry will be rejected.

.03 If the prenotification ACH credit is rejected, the financial institution should not originate an ACH credit entry for the taxpayer until the financial institution has successfully completed the prenotification process.

.04 To initiate a timely ACH credit e n t r y, a taxpayer must take into account its financial institution’s deadline for originating an ACH credit entry.

.05 The Service will deem an A C H debit entry to have been made at the time of the debit ( i . e ., when the amount is withdrawn from the taxpayer’s account and not returned or reversed).

.06 When a timely ACH debit entry cannot be made, a taxpayer may instruct the Financial Agent to complete the transaction at the next opportunity to submit an ACH debit entry. The taxpayer may also use the ACH credit entry payment option or ETA. See section 8 of this revenue procedure regarding the use of an A C H credit entry and section 9 regarding the use of ETA. A taxpayer that is not required to use EFT for FTDs may use the paper FTD coupon system. To avoid penalties, the FTD or FTP must be received by an appropriate means on or before the FTD or FTP due date.

.07 The ACH Rules will govern A C H debit entry returns and reversals.