Internal Revenue Bulletin 1996-27 (PDF rendition): IRS Revenue Rulings

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Bulletin No. 1996–27
July 1, 1996
HIGHLIGHTS
OF THIS ISSUE
These synopses are intended only as aids to the reader in
identifying the subject matter covered. They may not be
relied upon as authoritative interpretations.
INCOME TAX
T.D. 8673, page 4.
Final regulations under section 1394 of the Code relate to
enterprise zone facility bonds issued by state and local
governments.
Rev. Rul. 96–33, page 4.
Low-income housing credit; satisfactory bond; ‘‘bond
factor’’ amounts for the period April through June 1996.
This ruling announces the monthly bond factor amounts
to be used by taxpayers who dispose of qualified low-
income buildings or interests therein during the period
April through June 1996.
EMPLOYEE PLANS
Notice 96–36, page 11.
Guidelines are set forth for determining for June 1996
the weighted average interest rate and the resulting
permissible range of interest rates used to calculate
current liability for purposes of the full funding
limitation of section 412(c)(7) of the Code as amended
by the Omnibus Budget Reconciliation Act of 1987 and
by the Uruguay Round Agreements Act (GATT).
EXEMPT ORGANIZATIONS
Announcement 96–61, page 72.
A list is provided of organizations that no longer qualify
as organizations to which contributions are deductible
under section 170 of the Code.
ADMINISTRATIVE
Rev. Proc. 96–36, page 11.
Electronic filing; magnetic media; 1996 form specifica-
tions. Specifications are set forth for the magnetic or
electronic filing of 1996 Forms 1098, 1099, 5498,
and W–2G. The forms may be filed with the Service
using
1
⁄2 inch magnetic tape; IBM 3480/3490 or
AS400 compatible tape cartridges; 8 mm tape car-
tridges (pilot program) or 5
1
⁄4-, 3
1
⁄2-inch diskettes. Rev.
Procs. 95–29 and 95–29A superseded.
Finding Lists begin on page 75.
Announcement of Disbarments and Suspensions begins on page 73.

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Mission of the Service
The purpose of the Internal Revenue Service is to
collect the proper amount of tax revenue at the least
cost; serve the public by continually improving the
quality of our products and services; and perform in a
manner warranting the highest degree of public
confidence in our integrity, efficiency and fairness.
Statement of Principles
of Internal Revenue
Tax Administration
The function of the Internal Revenue Service is to
administer the Internal Revenue Code. Tax policy
for raising revenue is determined by Congress.
With this in mind, it is the duty of the Service to
carry out that policy by correctly applying the laws
enacted by Congress; to determine the reasonable
meaning of various Code provisions in light of the
Congressional purpose in enacting them; and to
perform this work in a fair and impartial manner,
with neither a government nor a taxpayer point of
view.
At the heart of administration is interpretation of the
Code. It is the responsibility of each person in the
Service, charged with the duty of interpreting the
law, to try to find the true meaning of the statutory
provision and not to adopt a strained construction in
the belief that he or she is ‘‘protecting the revenue.’’
The revenue is properly protected only when we as-
certain and apply the true meaning of the statute.
The Service also has the responsibility of applying
and administering the law in a reasonable,
practical manner. Issues should only be raised by
examining officers when they have merit, never
arbitrarily or for trading purposes. At the same
time, the examining officer should never hesitate
to raise a meritorious issue. It is also important
that care be exercised not to raise an issue or to
ask a court to adopt a position inconsistent with
an established Service position.
Administration should be both reasonable and
vigorous. It should be conducted with as little
delay as possible and with great courtesy and
considerateness. It should never try to overreach,
and should be reasonable within the bounds of law
and sound administration. It should, however, be
vigorous in requiring compliance with law and it
should be relentless in its attack on unreal tax
devices and fraud.

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Introduction
The Internal Revenue Bulletin is the authoritative
instrument of the Commissioner of Internal Revenue for
announcing official rulings and procedures of the
Internal Revenue Service and for publishing Treasury
Decisions, Executive Orders, Tax Conventions, legisla-
tion, court decisions, and other items of general
interest. It is published weekly and may be obtained
from the Superintendent of Documents on a subscrip-
tion basis. Bulletin contents of a permanent nature are
consolidated semiannually into Cumulative Bulletins,
which are sold on a single-copy basis.
It is the policy of the Service to publish in the Bulletin
all substantive rulings necessary to promote a uniform
application of the tax laws, including all rulings that
supersede, revoke, modify, or amend any of those
previously published in the Bulletin. All published
rulings apply retroactively unless otherwise indicated.
Procedures relating solely to matters of internal
management are not published; however, statements of
internal practices and procedures that affect the rights
and duties of taxpayers are published.
Revenue rulings represent the conclusions of the
Service on the application of the law to the pivotal facts
stated in the revenue ruling. In those based on
positions taken in rulings to taxpayers or technical
advice to Service field offices, identifying details and
information of a confidential nature are deleted to
prevent unwarranted invasions of privacy and to comply
with statutory requirements.
Rulings and procedures reported in the Bulletin do not
have the force and effect of Treasury Department
Regulations, but they may be used as precedents.
Unpublished rulings will not be relied on, used, or cited
as precedents by Service personnel in the disposition of
other cases. In applying published rulings and proce-
dures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be
considered, and Service personnel and others con-
cerned are cautioned against reaching the same
conclusions in other cases unless the facts and
circumstances are substantially the same.
The Bulletin is divided into four parts as follows:
Part I.—1986 Code.
This part includes rulings and decisions based on
provisions of the Internal Revenue Code of 1986.
Part II.—Treaties and Tax Legislation.
This part is divided into two subparts as follows:
Subpart A, Tax Conventions, and Subpart B, Legislation
and Related Committee Reports.
Part III.—Administrative, Procedural, and Miscellaneous.
To the extent practicable, pertinent cross references to
these subjects are contained in the other Parts and
Subparts. Also included in this part are Bank Secrecy
Act Administrative Rulings. Bank Secrecy Act Admin-
istrative Rulings are issued by the Department of the
Treasury’s Office of the Assistant Secretary
(Enforcement).
Part IV.—Items of General Interest.
With the exception of the Notice of Proposed Rulemak-
ing and the disbarment and suspension list included in
this part, none of these announcements are consoli-
dated in the Cumulative Bulletins.
The first Bulletin for each month includes an index for
the matters published during the preceding month.
These monthly indexes are cumulated on a quarterly
and semiannual basis, and are published in the first
Bulletin of the succeeding quarterly and semi-annual
period, respectively.
The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.
For sale by the Superintendent of Documents U.S. Government Printing Office, Washington, D.C. 20402.

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Part I. Rulings and Decisions Under the Internal Revenue Code of 1986
Section 42.—Low-Income Housing
Credit
Low-income housing credit; satisfac-
tory bond; ‘‘bond factor’’ amounts for
the period April through June 1996.
This ruling announces the monthly
bond factor amounts to be used by
taxpayers who dispose of qualified
low-income buildings or interests
therein during the period April through
June 1996.
Rev. Rul. 96–33
In Rev. Rul. 90–60, 1990–2 C.B. 3,
the Internal Revenue Service provided
guidance to taxpayers concerning the
general methodology used by the
Treasury Department in computing the
bond factor amounts used in calculating
the amount of bond considered satisfac-
tory by the Secretary under §42(j)(6)
of the Internal Revenue Code. It further
announced that the Secretary would
publish in the Internal Revenue Bul-
letin a table of ‘‘bond factor’’ amounts
for dispositions occurring during each
calendar month.
This revenue ruling provides in
Table 1 the bond factor amounts for
calculating the amount of bond consid-
ered satisfactory under §42(j)(6) for
dispositions of qualified low-income
buildings or interests therein during the
period April through June 1996.
Table 1
Rev. Rul. 96–33
Monthly Bond Factor Amounts for Dispositions Expressed
As a Percentage of Total Credits
Calendar Year Building Placed in Service or, if Section 42(f)(1)
Election Was Made, the Succeeding Calendar Year
Month of
Disposition1987198819891990199119921993199419951996
Apr ’9676.7678.2679.9181.9484.4387.3890.4093.1695.6197.21
May ’9676.5478.0379.6881.7184.1987.1290.1292.8695.3297.21
Jun ’9676.3277.8179.4681.4883.9586.8689.8592.5895.0697.21
For a list of bond factor amounts
applicable to dispositions occurring
during other calendar years, see the
following revenue rulings: Rev. Rul.
90–60, 1990–2 C.B. 3, for dispositions
occurring during calendar years 1987,
1988, and 1989; Rev. Rul. 90–88,
1990–2 C.B. 7, for dispositions occur-
ring during calendar year 1990; Rev.
Rul. 91–67, 1991–2 C.B. 13, for dis-
positions occurring during calendar
year 1991; Rev. Rul. 92–101, 1992–2
C.B. 9, for dispositions occurring dur-
ing calendar year 1992; Rev. Rul 93–
83, 1993–2 C.B. 6, for dispositions
occurring during calendar year 1993;
Rev. Rul. 94–71, 1994–2 C.B. 4, for
dispositions occurring during calendar
year 1994; Rev. Rul. 95–83, 1995–52
I.R.B. 5, for dispositions occurring
during calendar year 1995; and Rev.
Rul. 96–16, 1996–11 I.R.B. 4, for dis-
positions occurring during the period
January through March 1996.
DRAFTING INFORMATION
The principal author of this revenue
ruling is Jack Malgeri of the Office of
Assistant Chief Counsel (Passthroughs
and Special Industries). For further
information regarding this revenue rul-
ing, contact Mr. Malgeri at (202)
622-3040 (not a toll-free call).
Section 1394.—Tax-Exempt
Enterprise Zone Facility Bonds
26 CFR 1.1394–1: Enterprise zone facility
bonds.
T.D. 8673
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
Enterprise Zone Facility Bonds
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Final regulations.
SUMMARY: This document contains
final regulations relating to enterprise
zone facility bonds issued by State and
local governments. These regulations
reflect changes to the law made by the
Omnibus Budget Reconciliation Act of
1993. These regulations affect issuers
of enterprise zone facility bonds.
EFFECTIVE DATE: These regulations
are effective May 31, 1996.
For dates of applicability of these
regulations to enterprise zone facility
bond issues, see §1.1394–1(q) of these
regulations.
FOR FURTHER INFORMATION
CONTACT: Loretta J. Finger, (202)
622-3980 (not a toll-free number).
SUPPLEMENTARY INFORMATION:
Background
On December 30, 1994, proposed
regulations (FI–72–88 [1995–1 C.B.
859]) were published in the Federal
Register (59 FR 67658) to provide
guidance under sections 141 (relating
to private activity bonds and to

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qualified bonds), 145 (relating to
qualified 501(c)(3) bonds), 148 (relat-
ing to arbitrage), 150 (relating to
change of use), and 1394 (relating to
enterprise zone facility bonds). On June
8, 1995, the IRS held a public hearing
on the proposed regulations. Written
comments responding to the proposed
regulations were received.
This Treasury decision addresses the
issues relating to enterprise zone facil-
ity bonds. Later guidance will be pub-
lished relating to sections 141, 145,
148, and 150. After consideration of all
the comments, the proposed regulations
under section 1394 (relating to en-
terprise zone facility bonds) are
adopted as revised by this Treasury
decision. The principal revisions to the
proposed regulations under section
1394 are discussed below.
Explanation of Provisions
Section 1394 applies to bonds issued
to provide enterprise zone facilities in
both empowerment zones and en-
terprise communities (zones).
A.Period of compliance.
The proposed regulations in general
require compliance with the require-
ments applicable to enterprise zone
facility bonds throughout the term of
the enterprise zone facility bonds. The
proposed regulations provide two ex-
ceptions to this general rule: (i) a
business that is first established in
connection with the issuance of en-
terprise zone facility bonds does not
need to meet the requirements of an
enterprise zone business and enterprise
zone property until the ‘‘testing date,’’
which is the later of one year after the
issue date or one year after the date on
which the financed property is placed
in service, and (ii) the issuer and
principal user of the facility are permit-
ted a one-year period to cure non-
compliance.
The final regulations modify the
general rule to require compliance with
the requirements applicable to en-
terprise zone facility bonds throughout
the greater of (i) the remainder of the
period during which the zone designa-
tion is in effect under section 1391
(zone designation period), and (ii) the
period that ends on the weighted
average maturity date of the enterprise
zone facility bonds. The final regula-
tions also provide that, in general,
compliance with the requirements ap-
plicable to enterprise zone facility
bonds is not required after the date on
which the last of the enterprise zone
facility bonds of the issue cease to be
outstanding.
1.Start of compliance period.
Commentators requested that the
testing date provisions be extended to
all businesses, not just start-up busi-
nesses. Commentators also suggested
lengthening the start-up period. The
final regulations follow the recommen-
dation to expand the testing date
provisions to all issuers and principal
users of property financed with en-
terprise zone facility bonds if the issuer
and the principal user reasonably ex-
pect that the requirements will be met
by the testing date and proceed with
due diligence to comply with the
requirements. The start-up period is
increased to the later of 18 months
after the issue date or 18 months after
the date on which the financed property
is placed in service.
2.Compliance period for certain
requirements.
Commentators suggested that com-
pliance with the requirements for an
enterprise zone business should be
based only on reasonable expectations
on the issue date. Commentators sug-
gested that, alternatively, the required
compliance period should be reduced to
either (i) three years (similar to the test
period for qualified small issue man-
ufacturing bonds), or (ii) the remainder
of the zone designation period.
Issuers and principal users should be
required to meet the requirements
applicable to enterprise zone facility
bonds for a meaningful period of time
in order to further the goals of
economic development in the zones.
Therefore, for purposes of meeting the
requirements applicable to enterprise
zone facility bonds, the final regula-
tions in general require issuers and
principal users of financed property to
meet the requirements throughout the
greater of (i) the remainder of the zone
designation period, and (ii) the period
that ends on the weighted average
maturity date of the enterprise zone
facility bonds.
While compliance is generally not
required after the enterprise zone facil-
ity bonds are retired, the final regula-
tions do require issuers and principal
users to meet the requirements of an
enterprise zone business and enterprise
zone property for a minimum com-
pliance period of at least three years
after the initial testing date. The final
regulations permit the issuer to identify
an alternative initial testing date. This
alternative initial testing date is a date
after the issue date of the enterprise
zone facility bonds and prior to the
initial testing date that would have
been otherwise determined under the
final regulations.
Principal users are subject to the
change in use penalty of section
1394(e) throughout the greater of (i)
the remainder of the zone designation
period, and (ii) the period that ends on
the weighted average maturity date of
the enterprise zone facility bonds.
3.Measurement of compliance.
The proposed regulations provide
guidance on meeting the enterprise
zone business definitions. Commenta-
tors pointed out several difficulties in
meeting the tests in the proposed
regulations and in curing non-
compliance within a one-year period.
Commentators also asked for guidance
on how part-time employees are to be
treated for the 35 percent resident
employee requirement.
In general, each of the enterprise
zone business requirements applies
over taxable year periods. The begin-
ning and end of the period of required
compliance, however, may not corre-
spond to the beginning and ending
dates of the principal user’s taxable
year. The proposed regulations do not
address the treatment of a taxable year
only a part of which falls in a required
compliance period. The final regula-
tions provide that a taxable year is
disregarded if the part of the year that
falls in a required compliance period
does not exceed 90 days.
Although the final regulations gener-
ally require annual compliance for the
requirements under sections 1397B and
1397C, the final regulations allow a
five-year averaging, taking into account
only immediately preceding years
going back to the taxable year that
includes the initial testing date. The
requirements under sections 1397B and
1397C include requirements relating to
location of performance of employee
services, location of tangible and intan-
gible property, source of gross income

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from the active conduct of business,
and the residence of employees. The
averaging approach permits principal
users who exceed the requirements to
provide a cushion for future unantici-
pated noncompliance (for example, a
non-recurring extraordinary payment
for services performed outside the
zone).
The final regulations allow the 35
percent resident employee requirement
to be met on any reasonable basis (for
example, on a per-employee basis or on
the basis of employee actual work
hours). For purposes of the per-
employee fraction, employees working
less than 15 hours a week are not
included in the numerator or the
denominator. The principal user must
consistently apply the method to deter-
mine compliance with the 35 percent
resident employee requirement through-
out the required compliance period.
The final regulations also provide
that a zone employee who moves out
of the zone may continue to be treated
as a resident of the zone, provided that
employee was a bona fide resident of
the zone, that employee continues to
perform services for the principal user
in an enterprise zone business in the
zone and substantially all of those
services are performed in the zone, and
the principal user hires a resident of the
zone for the next available comparable
(or lesser) position.
The final regulations reduce the
‘‘substantially all’’ requirement for
purposes of various tests under sections
1397B and 1397C from 90 percent to
85 percent.
B.Qualified zone property definition.
The proposed regulations provide that
property that has been abandoned for
more than one year meets the original
use requirement. The final regulations
provide that if real property is vacant
for at least a one-year period including
the date of zone designation, use prior
to that period is disregarded for pur-
poses of determining original use.
C. Other rules.
Commentators requested guidance on
the appropriate method for treating
activities within the zone as though
they constituted a separately incorpo-
rated business for purposes of the
enterprise zone business test.
The final regulations allow a business
to treat its activities within a zone as
part of a separately incorporated busi-
ness if it allocates income and activities
attributable to the business within the
zone using a reasonable allocation
method and has evidence of its alloca-
tions sufficient to establish compliance
with the various requirements.
D. Principal user.
The proposed regulations do not
address the requirement that ‘‘the prin-
cipal user’’ of the enterprise zone
facility bond proceeds be an enterprise
zone business. Commentators suggested
that principal user generally be defined
in the same manner as in the regula-
tions applicable to qualified small issue
bonds and qualified 501(c)(3) bonds,
which relate to use of bond proceeds
by ‘‘any’’ principal user, but without
applying the definition to customers.
One commentator (relying on the defi-
nition of a qualifying business) sug-
gested that financing for commercial
real estate owned by a business that is
not an enterprise zone business should
be permitted, so long as 50 percent of
the gross rental income comes from
lessees that are enterprise zone
businesses.
The final regulations provide that an
owner of financed property is the
principal user except that, in the case
of commercial real estate, the lessee
may be treated as the principal user if
the rental of the property is a qualified
business under section 1397B(d)(2).
Special Analyses
It has been determined that this
Treasury decision is not a significant
regulatory action as defined in EO
12866. Therefore, a regulatory assess-
ment is not required. It also has been
determined that section 553(b) of the
Administrative Procedure Act (5 U.S.C.
chapter 5) and the Regulatory Flex-
ibility Act (5 U.S.C. chapter 6) do not
apply to these regulations, and, there-
fore, a Regulatory Flexibility Analysis
is not required. Pursuant to section
7805(f) of the Internal Revenue Code,
the notice of proposed rulemaking
preceding these regulations was submit-
ted to the Small Business Administra-
tion for comment on its impact on
small business.
Drafting Information
The principal author of these regula-
tions is Loretta J. Finger, Office of
Assistant Chief Counsel (Financial In-
stitutions and Products). However,
other personnel from the IRS and
Treasury Department participated in
their development.
******
Adoption of Amendments to the
Regulations
Accordingly, 26 CFR part 1 is
amended as follows:
PART 1—INCOME TAXES
Paragraph 1. The authority citation
for part 1 is amended by adding an
entry in numerical order to read as
follows:
Authority: 26 U.S.C. 7805 ** *
Section 1.1394–1 also issued under 26
U.S.C. 1397D.
Par. 2. Sections 1.1394–0 and
1.1394–1 are added under the undesig-
nated centerheading ‘‘DEFINITIONS;
SPECIAL RULES’’ to read as follows:
§1.1394–0 Table of contents.
This section lists the major para-
graph headings contained in §1.1394–1.
§1.1394–1 Enterprise zone facility
bonds.
(a)Scope.
(b)Period of compliance.
(1)In general.
(2)Compliance after an issue is
retired.
(3)Deemed compliance.
(c)Special rules for requirements of
sections 1397B and 1397C.
(1)Start of compliance period.
(2)Compliance period for certain
prohibited activities.
(3)Minimum compliance period.
(4)Initial testing date.
(d)Testing on an average basis.
(e)Resident employee requirements.
(1)Determination of employee
status.
(2)Employee treated as zone
resident.
(3) R e s i d e n t e m p l o y e e p e r -
centage.
(f)Application to pooled financing
bond and loan recycling
programs.
(g)Limitation on amount of bonds.
(1)Determination of outstanding
amount.

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(2) P o o l e d f i n a n c i n g b o n d
programs.
(h)Original use requirement for pur-
poses of qualified zone property.
(i)Land.
(j)Principal user.
(1)In general.
(2)Rental of real property.
(3)Pooled financing bond pro-
gram.
(k)Treatment as separately incorpo-
rated business.
(l)Substantially all.
(m)Application of sections 142 and
146 through 150.
(1)In general.
(2)Maturity limitation.
(3)Volume cap.
(4)Remedial actions.
(n)Continuing compliance and
change of use penalties.
(1)In general.
(2) Coordination with deemed
compliance provisions.
(3)Application to pooled financ-
ing bond and loan recycling
programs.
(4) S e c t i o n 1 5 0 ( b ) ( 4 ) i n a p -
plicable.
(o)Refunding bonds.
(1)In general.
(2)Maturity limitation.
(p)Examples.
(q)Effective dates.
(1)In general.
(2)Elective retroactive applica-
tion in whole.
§1.1394–1 Enterprise zone facility
bonds.
(a)Scope. This section contains
rules relating to tax-exempt bonds
under section 1394 (enterprise zone
facility bonds) to provide enterprise
zone facilities in both empowerment
zones and enterprise communities
(zones). See sections 1394, 1397B, and
1397C for other rules and definitions.
(b)Period of compliance—(1) In
general. Except as provided in para-
graphs (b)(2) and (c) of this section,
the requirements under sections 1394(a)
and (b) applicable to enterprise zone
facility bonds must be complied with
t h r o u g h o u t t h e g r e a t e r o f t h e
following—
(i)The remainder of the period
during which the zone designation is in
effect under section 1391 (zone desig-
nation period); and
(ii)The period that ends on the
weighted average maturity date of the
enterprise zone facility bonds.
(2)Compliance after an issue is
retired. Except as provided in para-
graph (c)(3) of this section, the require-
ments applicable to enterprise zone
facility bonds do not apply to an issue
after the date on which no enterprise
zone facility bonds of the issue are
outstanding.
(3)Deemed compliance—(i) General
rule. An issue is deemed to comply
with the requirements of sections
1394(a) and (b) if—
(A)The issuer and the principal user
in good faith attempt to meet the
requirements of sections 1394(a) and
(b) throughout the period of com-
pliance required under this section; and
(B)Any failure to meet these re-
quirements is corrected within a one-
year period after the failure is first
discovered.
(ii)Exception. The provisions of
paragraph (b)(3)(i) of this section do
not apply to the requirements of section
1397B(d)(5)(A) (relating to certain pro-
hibited business activities).
(iii)Good faith. In order to satisfy
the good faith requirement of paragraph
(b)(3)(i)(A) of this section, the princi-
pal user must at least annually demon-
strate to the issuer the principal user’s
monitoring of compliance with the re-
quirements of sections 1394(a) and (b).
(c)Special rules for requirements of
sections 1397B and 1397C—(1) Start
of compliance period. Except as pro-
vided in paragraph (c)(2) of this
section, the requirements of sections
1397B (relating to qualification as an
enterprise zone business) and 1397C
(relating to satisfaction of the rules for
qualified zone property) do not apply
prior to the initial testing date (as
defined in paragraph (c)(4) of this
section) if—
(i)The issuer and the principal user
reasonably expect on the issue date of
the enterprise zone facility bonds that
those requirements will be met by the
principal user on or before the initial
testing date; and
(ii)The issuer and the principal user
exercise due diligence to meet those
requirements prior to the initial testing
date.
(2)Compliance period for certain
prohibited activities. The requirements
of section 1397B(d)(5)(A) (relating to
certain prohibited business activities)
must be complied with throughout the
term of the enterprise zone facility
bonds.
(3)Minimum compliance period.
The requirements of sections 1397B(b)
or (c) and 1397C must be satisfied for
a continuous period of at least three
years after the initial testing date,
notwithstanding that—
(i)The period of compliance re-
quired under paragraph (b)(1) of this
section expires before the end of the
three-year period; or
(ii) The enterprise zone facility
bonds are retired before the end of the
three-year period.
(4)Initial testing date—(i) In gen-
eral. Except as otherwise provided in
paragraph (c)(4)(ii) of this section, the
initial testing date is the date that is 18
months after the later of the issue date
of the enterprise zone facility bonds or
the date on which the financed property
is placed in service; provided, however,
it is not later than—
(A)Three years after the issue date;
or
(B)Five years after the issue date, if
the issue finances a construction project
for which both the issuer and a
licensed architect or engineer certify on
or before the issue date of the en-
terprise zone facility bonds that more
than three years after the issue date is
necessary to complete construction of
the project.
(ii)Alternative initial testing date. If
the issuer identifies as the initial testing
date a date after the issue date of the
enterprise zone facility bonds and prior
to the initial testing date that would
have been determined under paragraph
(c)(4)(i) of this section, that earlier date
is treated as the initial testing date.
(d)Testing on an average basis.
Compliance with each of the require-
ments of section 1397B(b) or (c) is
tested each taxable year. Compliance
with any of the requirements may be
tested on an average basis, taking into
account up to four immediately preced-
ing taxable years plus the current
taxable year. The earliest taxable year
that may be taken into account for
purposes of the preceding sentence is
the taxable year that includes the initial
testing date. A taxable year is dis-
regarded if the part of the taxable year
that falls in a required compliance
period does not exceed 90 days.
(e)Resident employee require-
ments—(1) Determination of employee
status. For purposes of the requirement
of section 1397B(b)(6) or (c)(5) that at
least 35 percent of the employees are
residents of the zone, the issuer and the

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principal user may rely on a certifica-
tion, signed under penalties of perjury
by the employee, provided—
(i)The certification provides to the
principal user the address of the
employee’s principal residence;
(ii)The employee is required by the
certification to notify the principal user
of a change of the employee’s principal
residence; and
(iii)Neither the issuer nor the prin-
cipal user has actual knowledge that
the principal residence set forth in the
certification is not the employee’s
principal residence.
(2)Employee treated as zone re-
sident. If an issue fails to comply with
the requirement of section 1397B(b)(6)
or (c)(5) because an employee who
initially resided in the zone moves out
of the zone, that employee is treated as
still residing in the zone if—
(i)That employee was a bona fide
resident of the zone at the time of the
certification described in paragraph
(e)(1) of this section;
(ii)That employee continues to per-
form services for the principal user in
an enterprise zone business and sub-
stantially all of those services are
performed in the zone; and
(iii)A resident of the zone meeting
the requirements of section 1397B(b)-
(5) or (c)(4) is hired by the principal
user for the next available comparable
(or lesser) position.
(3)Resident employee percentage.
For purposes of meeting the require-
ment of section 1397B(b)(6) or (c)(5)
that at least 35 percent of the
employees of an enterprise zone busi-
ness are residents of a zone, paragraphs
(e)(3)(i) and (ii) of this section apply.
(i)The term employee includes a
self-employed individual within the
meaning of section 401(c)(1).
(ii)The resident employee percent-
age is determined on any reasonable
basis consistently applied throughout
the period of compliance required
under this section. The per-employee
fraction (as defined in paragraph
(e)(3)(ii)(A) of this section) or the
employee actual work hour fraction (as
defined in paragraph (e)(3)(ii)(B) of
this section) are both reasonable
methods.
(A)The term per-employee fraction
means the fraction, the numerator of
which is, during the taxable year, the
number of employees who work at
least 15 hours a week for the principal
user, who reside in the zone, and who
are employed for at least 90 days, and
the denominator of which is, during the
same taxable year, the aggregate num-
ber of all employees who work at least
15 hours a week for the principal user
and who are employed for at least 90
days.
(B)The term employee actual work
hour fraction means the fraction, the
numerator of which is the aggregate
total actual hours of work for the
principal user of employees who reside
in the zone during a taxable year, and
the denominator of which is the aggre-
gate total actual hours of work for the
principal user of all employees during
the same taxable year.
(f)Application to pooled financing
bond and loan recycling programs. In
the case of a pooled financing bond
program described in paragraph (g)(2)
of this section or a loan recycling
program described in paragraph (m)(2)-
(ii) of this section, the requirements of
paragraphs (b) through (e) of this
section apply on a loan-by-loan basis.
See also paragraphs (g)(2) (relating to
limitation on amount of bonds), (m)(2)
(relating to maturity limitations), (m)(3)
(relating to volume cap), and (m)(4)
(relating to remedial actions) of this
section.
(g)Limitation on amount of bonds—
(1) Determination of outstanding
amount. Whether an issue satisfies the
requirements of section 1394(c) (relat-
ing to the $3 million and $20 million
aggregate limitations on the amount of
outstanding enterprise zone facility
bonds) is determined as of the issue
date of that issue, based on the issue
price of that issue and the adjusted
issue price of outstanding enterprise
zone facility bonds. Amounts of out-
standing enterprise zone facility bonds
allocable to any entity are determined
under rules contained in section 144(a)-
(10)(C) and the underlying regulations.
Thus, the definition of principal user
for purposes of section 1394(c) is
different from the definition of princi-
pal user for purposes of paragraph (j)
of this section.
(2)Pooled financing bond pro-
grams—(i) In general. The limitations
of section 1394(c) for an issue for a
pooled financing bond program are
determined with regard to the amount
of the actual loans to enterprise zone
businesses rather than the amount lent
to intermediary lenders as defined in
paragraph (g)(2)(ii) of this section. This
paragraph (g)(2) applies only to the
extent the proceeds of those enterprise
zone facility bonds are loaned to one or
more enterprise zone businesses within
42 months of the issue date of the
enterprise zone facility bonds or are
used to redeem enterprise zone facility
bonds of the issue within that 42-month
period.
(ii)Pooled financing bond program
defined. For purposes of this section, a
pooled financing bond program is a
program in which the issuer of en-
terprise zone facility bonds, in order to
provide loans to enterprise zone busi-
nesses, lends the proceeds of the
enterprise zone facility bonds to a bank
or similar intermediary (intermediary
lender) which must then relend the
proceeds to two or more enterprise
zone businesses.
(h)Original use requirement for
purposes of qualified zone property. In
general, for purposes of section
1397C(a)(1)(B), the term original use
means the first use to which the
property is put within the zone. For
purposes of section 1394, if property is
vacant for at least a one-year period
including the date of zone designation,
use prior to that period is disregarded
for purposes of determining original
use. For this purpose, de minimis
incidental uses of property, such as
renting the side of a building for a
billboard, are disregarded.
(i)Land. The determination of
whether land is functionally related and
subordinate to qualified zone property
is made in a manner consistent with the
rules for exempt facilities under section
142.
(j)Principal user—(1) In general.
Except as provided in paragraph (j)(2)
of this section, the term principal user
means the owner of financed property.
(2)Rental of real property—(i) A
lessee as the principal user. If an
owner of real property financed with
enterprise zone facility bonds is not an
enterprise zone business within the
meaning of section 1397B, but the
rental of the property is a qualified
business within the meaning of section
1397B(d)(2), the term principal user
for purposes of sections 1394(b) and
(e) means the lessee or lessees.
(ii)Allocation of enterprise zone
facility bonds. If a lessee is the
principal user of real property under
paragraph (j)(2)(i) of this section, then
proceeds of enterprise zone facility
bonds may be allocated to expenditures

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for real property only to the extent of
the property allocable to the lessee’s
leased space, including expenditures for
common areas.
(3)Pooled financing bond program.
An intermediary lender in a pooled
financing bond program described in
paragraph (g)(2) of this section is not
treated as the principal user.
(k)Treatment as separately incorpo-
rated business. For purposes of section
1394(b)(3)(B), a trade or business may
be treated as separately incorporated if
allocations of income and activities
attributable to the business conducted
within the zone are made using a
reasonable allocation method and if
that trade or business has evidence of
those allocations sufficient to establish
compliance with the requirements of
paragraphs (b) through (f) of this
section. Whether an allocation method
is reasonable will depend upon the
facts and circumstances. An allocation
method will not be considered to be
reasonable unless the allocation method
is applied consistently by the trade or
business and is consistent with the
purposes of section 1394.
(l)Substantially all. For purposes of
sections 1397B and 1397C(a), the term
substantially all means 85 percent.
(m)Application of sections 142 and
146 through 150—(1) In general. Ex-
cept as provided in this paragraph (m),
enterprise zone facility bonds are
treated as exempt facility bonds that
are described in section 142(a), and all
regulations generally applicable to ex-
empt facility bonds apply to enterprise
zone facility bonds. For this purpose,
enterprise zone businesses are treated
as meeting the public use requirement.
Sections 147(c)(1)(A) (relating to lim-
itations on financing the acquisition of
land), 147(d) (relating to financing the
acquisition of existing property), and
142(b)(2) (relating to limitations on
financing office space) do not apply to
enterprise zone facility bonds. See also
paragraph (n)(4) of this section.
(2)Maturity limitation—(i) Require-
ments. An issue of enterprise zone
facility bonds, the proceeds of which
are to be used as part of a loan
recycling program, satisfies the require-
ments of section 147(b) if—
(A)Each loan satisfies the require-
ments of section 147(b) (determined by
treating each separate loan as a sepa-
rate issue); and
(B)The term of the issue does not
exceed 30 years.
(ii)Loan recycling program defined.
A loan recycling program is a program
in which—
(A)The issuer reasonably expects as
of the issue date of the enterprise zone
facility bonds that loan repayments
from principal users will be used to
make additional loans during the zone
designation period;
(B) Repayments of principal on
loans (including prepayments) received
during the zone designation period are
used within six months of the date of
receipt either to make new loans to
enterprise zone businesses or to redeem
enterprise zone facility bonds that are
part of the issue; and
(C) Repayments of principal on
loans (including prepayments) received
after the zone designation period are
used to redeem enterprise zone facility
bonds that are part of the issue within
six months of the date of receipt.
(3)Volume cap. For purposes of
applying section 146(f)(5)(A) (relating
to elective carryforward of unused
volume limitation), issuing enterprise
zone facility bonds is a carryforward
purpose.
(4)Remedial actions. In the case of
a pooled financing bond program de-
scribed in paragraph (g)(2) of this
section or a loan recycling program
described in paragraph (m)(2)(ii) of this
section, if a loan fails to meet the
requirements of paragraphs (b) through
(f) of this section, within six months of
noncompliance (after taking into ac-
count the deemed compliance provi-
sions of paragraph (b)(3) of this
section, if applicable), an amount equal
to the outstanding loan principal must
be prepaid and the issuer must—
(i)Reloan the amount of the prepay-
ment; or
(ii)Use the prepayment to redeem an
amount of outstanding enterprise zone
facility bonds equal to the outstanding
principal amount of the loan that no
longer meets those requirements.
(n)Continuing compliance and
change of use penalties—(1) In gen-
eral. The penalty provisions of section
1394(e) apply throughout the period of
compliance required under paragraph
(b)(1) of this section.
(2)Coordination with deemed com-
pliance provisions. Section 1394(e)(2)
does not apply during any period
during which the issue is deemed to
comply with the requirements of sec-
tion 1394 under the deemed compliance
provisions of paragraph (b)(3) of this
section.
(3)Application to pooled financing
bond and loan recycling programs. In
the case of a pooled financing bond
program described in paragraph (g)(2)
of this section or a loan recycling
program described in paragraph
(m)(2)(ii) of this section, section
1394(e) applies on a loan-by-loan
basis.
(4)Section 150(b)(4) inapplicable.
Section 150(b)(4) does not apply to
enterprise zone facility bonds.
(o)Refunding bonds—(1) In gen-
eral. An issue of bonds issued after the
zone designation period to refund en-
terprise zone facility bonds (other than
in an advance refunding) are treated as
enterprise zone facility bonds if the
refunding issue and the prior issue, if
treated as a single combined issue,
would meet all of the requirements for
enterprise zone facility bonds, except
the requirements in section 1394(c).
For example, the compliance period
described in paragraph (b)(1) of this
section is calculated taking into account
any extension of the weighted average
maturity of the refunding issue com-
pared to the remaining weighted aver-
age maturity of the prior issue. The
proceeds of the refunding issue are
allocated to the same expenditures and
purpose investments as the prior issue.
(2)Maturity limitation. The maturity
limitation of section 147(b) is applied
to a refunding issue by taking into
account the issuer’s reasonable expecta-
tions about the economic life of the
financed property as of the issue date
of the prior issue and the actual
weighted average maturity of the com-
bined refunding issue and prior issue.
(p)Examples. The following exam-
ples illustrate paragraphs (a) through
(o) of this section:
Example 1. Averaging of enterprise zone
business requirements. City C issues enterprise
zone facility bonds, the proceeds of which are
loaned by C to Corporation B to finance the
acquisition of equipment for its existing business
located in a zone. On the issue date of the
enterprise zone facility bonds, B meets all of the
requirements of section 1397B(b), except that
only 25% of B’s employees reside in the zone. C
and B reasonably expect on the issue date to
meet all requirements of section 1397B(b) by the
date that is 18 months after the equipment is
placed in service (the initial testing date). In each
of the first, second, and third taxable years after
the initial testing date, 35%, 40% and 45%,
respectively, of B’s employees are zone re-
sidents. In the fourth year after the testing date,
only 25% of B’s employees are zone residents. B

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continues to meet the 35% resident employee
requirement, because the average of zone re-
sident employees for those four taxable years is
approximately 36%. The percentage of zone
residents employed by B before the initial testing
date is not included in determining whether B
continues to comply with the 35% resident
employee requirement.
Example 2. Measurement of resident employee
percentage. Authority D issues enterprise zone
facility bonds, the proceeds of which are loaned
to Sole Proprietor F to establish an accounting
business in a zone. In the first year after the
initial testing date, the staff working for F
includes F, who works 40 hours per week and
does not live in the zone, one employee who
resides in the zone and works 40 hours per week,
one employee who does not reside in the zone
and works 20 hours per week, and one employee
who does not reside in the zone and works 10
hours per week. F meets the 35% resident
employee test by calculating the percentage on
the basis of employee actual work hours as
described in paragraph (e)(3)(ii)(B) of this
section. If F uses the per-employee basis as
described in paragraph (e)(3)(ii)(A) of this
section to determine if the resident employee test
is met, the percentage of employees who are
zone residents on a per-employee basis is only
33% because F must exclude from the numerator
and the denominator the employee who works
only 10 hours per week. If F calculates the
resident employee test as a percentage of
employee actual work hours as described in
paragraph (e)(3)(ii)(B) of this section in the first
year, F must calculate the resident employee test
as a percentage of employee actual work hours
each year.
Example 3. Active conduct of business within
the zone. State G issues enterprise zone facility
bonds and loans the proceeds to Corporation H
to finance the acquisition of equipment for H’s
mail order clothing business, which is located in
a zone. H purchases the supplies for its clothing
business from suppliers located both within and
outside of the zone and expects that orders will
be received both from customers who will reside
or work within the zone and from others outside
the zone. All orders are received and filled at,
and are shipped from, H’s clothing business
located in the zone. H meets the requirement that
at least 80% of its gross income is derived from
the active conduct of business within the zone.
Example 4. Enterprise zone business defini-
tion. City J issues enterprise zone facility bonds,
the proceeds of which are loaned to Partnership
K to finance the acquisition of equipment for its
printing operation located in the zone. All orders
are taken and completed, and all billing and
accounting activities are performed, at the print
shop located in the zone. K, on occasion, uses its
equipment (including its trucks) and employees
to deliver large print jobs to customers who
reside outside of the zone. So long as K is able
to establish that its trucks are used in the zone at
least 85% of the time and its employees perform
at least 85% of services for K in the zone, K
meets the requirements of sections 1397B(b)(3)
and (5).
Example 5. Treatment as a separately incorpo-
rated business. The facts are the same as in
Example 4 except that six years after the issue
date of the enterprise zone facility bonds, K
determines to expand its operations to a second
location outside of the boundaries of the zone.
Although the expansion would result in the
failure of K to meet the tests of 1397B(b), K,
using a reasonable allocation method, allocates
income and activities to its operations within the
zone and has evidence of these allocations
sufficient to establish compliance with the
requirements of paragraphs (b) through (f) of this
section. The bonds will not fail to be enterprise
zone facility bonds merely because of the
expansion.
Example 6. Treatment of pooled financing
bond programs. Authority L issues bonds in the
aggregate principal amount of $5,000,000 and
loans the proceeds to Bank M pursuant to a
loans-to-lenders program. M does not meet the
definition of enterprise zone business contained
in section 1397B. Prior to the issue date of the
bonds, L held a public hearing regarding
issuance of the bonds for the loans-to-lenders
program, describing the projects of identified
borrowers to be financed initially with
$4,000,000 of the proceeds of the bonds. The
applicable elected representative of L approved
issuance of the bonds subsequent to the public
hearing. The loan agreement between L and M
provides that the other proceeds of the bonds
will be held by M and loaned to borrowers that
qualify as enterprise zone businesses, following a
public hearing and approval by the applicable
elected representative of L of each loan by M to
an enterprise zone business. None of the loans
will be in principal amounts in excess of
$3,000,000. The loans by M will otherwise meet
the requirements of section 1394. The bonds will
be enterprise zone facility bonds.
Example 7. Original use requirement for
purposes of qualified zone property. City N
issues enterprise zone facility bonds, the pro-
ceeds of which are loaned to Corporation P to
finance the acquisition of equipment. P uses the
proceeds after the zone designation date to
purchase used equipment located outside of the
zone and places the equipment in service at its
location in the zone. Substantially all of the use
of the equipment is in the zone and is in the
active conduct of a qualified business by P. The
equipment is treated as qualified enterprise zone
property under section 1397C because P makes
the first use of the property within the zone after
the zone designation date.
Example 8. Principal user. State R issues
enterprise zone facility bonds and loans the
proceeds to Partnership S to finance the con-
struction of a small shopping center to be located
in a zone. S is in the business of commercial real
estate. S is not an enterprise zone business, but
has secured one anchor lessee, Corporation T, for
the shopping center. T would qualify as an
enterprise zone business. S will derive 60% of its
gross rental income of the shopping center from
T. S does not anticipate that the remaining rental
income will come from enterprise zone busi-
nesses. T will occupy 60% of the total rentable
space in the shopping center. S can use
enterprise zone facility bond proceeds to finance
the portion of the costs of the shopping center
allocable to T (60%) because T is treated as the
principal user of the enterprise zone facility bond
proceeds.
Example 9. Remedial actions. State W issues
pooled financing enterprise zone facility bonds,
the proceeds of which will be loaned to several
enterprise zone businesses in the two enterprise
communities and one empowerment zone in W.
Proceeds of the pooled financing bonds are
loaned to Corporation X, an enterprise zone
business, for a term of 10 years. Six years after
the date of the loan, X expands its operations
beyond the empowerment zone and is no longer
able to meet the requirements of section 1394. X
does not reasonably expect to be able to cure the
noncompliance. The loan documents provide that
X must prepay its loan in the event of non-
compliance. W does not expect to be able to
reloan the prepayment by X within six months of
noncompliance. X’s noncompliance will not
affect the qualification of the pooled financing
bonds as enterprise zone facility bonds if W uses
the proceeds from the loan prepayment to redeem
outstanding enterprise zone facility bonds within
six months of noncompliance in an amount
comparable to the outstanding amount of the
loan immediately prior to prepayment. X will be
denied an interest expense deduction for the
interest accruing from the first day of the taxable
year in which the noncompliance began.
(q)Effective dates—(1) In general.
Except as otherwise provided in this
section, the provisions of this section
apply to all issues issued after July 30,
1996, and subject to section 1394.
(2)Elective retroactive application
in whole. An issuer may apply the
provisions of this section in whole, but
not in part, to any issue that is
outstanding on July 30, 1996, and is
subject to section 1394.
Margaret Milner Richardson,
Commissioner of Internal Revenue.
Approved May 22, 1996.
Leslie Samuels,
Assistant Secretary of the Treasury.
(Filed by the Office of the Federal Register on
May 30, 1996, 8:45 a.m., and published in the
issue of the Federal Register for May 31,
1996, 61 F.R. 27258)

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Part III.Administrative, Procedural, and Miscellaneous
Weighted Average Interest Rate
Update
Notice 96–36
Notice 88–73 provides guidelines for
determining the weighted average inter-
est rate and the resulting permissible
range of interest rates used to calculate
current liability for the purpose of the
full funding limitation of §412(c)(7) of
the Internal Revenue Code as amended
by the Omnibus Budget Reconciliation
Act of 1987 and as further amended by
the Uruguay Round Agreements Act,
Pub. L. 103–465 (GATT).
The average yield on the 30-year
Treasury Constant Maturities for May
1996 is 6.93 percent.
The following rates were determined
for the plan years beginning in the
month shown below.
MonthYear
Weighted
Average
90% to 108%
Permissible
Range
90% to 110%
Permissible
Range
June19966.926.23 to 7.486.23 to 7.61
Drafting Information
The principal author of this notice is Donna Prestia of the Employee Plans Division. For further information regarding this
notice, call (202) 622-6076 between 2:30 and 4:00 p.m. Eastern time (not a toll-free number). Ms. Prestia’s number is (202)
622-7377 (also not a toll-free number).
Rev. Proc. 96–36
Use this revenue procedure to prepare Tax Year 1996 information returns for submission to Internal Revenue Service
(IRS) using any of the following:
—Magnetic Tape
—Tape Cartridge
—8mm (.315-inch) Tape Cartridge
*(Pilot for AS400 Operating Systems)
— 5
1
⁄4-inch Diskette
— 3
1
⁄2-inch Diskette
—Electronic Filing
—(Bisynchronous)
—(Asynchronous)
IRS/MCC has discontinued processing 8-inch diskettes for tax year 1996, calendar year 1997. If you currently file
information returns on 8-inch diskette, you need to change to one of the options listed above.
*For Tax Year 1996, the processing of 8mm tape cartridge as an acceptable form of magnetic media is offered as a
pilot program for transmitters using AS400 systems only.
Please read this publication carefully. Persons or businesses required to file information returns may be subject to
penalties for failure to file or include correct information if they do not follow the instructions in this revenue procedure.
Table of Contents
Part A. General
Section 1.Purpose
Section 2.Nature of Changes—Current Year (Tax Year 1996)
Section 3.Where to File and How to Contact the IRS, Martinsburg Computing Center
Section 4.Filing Requirements
Section 5.Form 8508, Request for Waiver from Filing Information Returns on Magnetic Media
Section 6.Vendor List
Section 7.Form 4419, Application for Filing Information Returns Magnetically/Electronically
Section 8.Test Files
Section 9.Filing of Information Returns Magnetically/Electronically and Retention Requirements

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Section 10.Due Dates
Section 11.Extensions of Time
Section 12.Processing of Information Returns Magnetically/Electronically
Section 13.Corrected Returns
Section 14.Taxpayer Identification Number (TIN)
Section 15.Effect on Paper Returns
Section 16.Combined Federal/State Filing Program
Section 17.Definition of Terms
Section 18.State Abbreviations
Section 19.Major Problems Encountered
Part B. Magnetic Media Specifications
Section 1.General
Section 2.Tape Specifications
Section 3.Tape Cartridge Specifications
Section 4.8mm (.315-inch) Tape Cartridge Specifications
Section 5.5
1
⁄4-inch and 3
1
⁄2-inch Diskette Specifications
Section 6.Payer/transmitter ‘‘A’’ Record—General Field Descriptions
Section 7.Payer/transmitter ‘‘A’’ Record—Record Layout
Section 8.Payee ‘‘B’’ Record—General Field Descriptions and Record Layouts
Section 9.End of Payer ‘‘C’’ Record—Record Layout
Section 10.State Totals ‘‘K’’ Record—Record Layout
Section 11.End of Transmission ‘‘F’’ Record—Record Layout
Part C. Bisynchronous (Mainframe) Electronic Filing Specifications
Section 1.General
Section 2.Electronic Filing Approval Procedure
Section 3.Test Files
Section 4.Electronic Submissions
Section 5.Transmittal Requirements
Section 6.IBM 3780 Bisynchronous Communication Specifications
Section 7.Bisynchronous Electronic Filing Record Specifications
Part D. Asynchronous (IRP–BBS) Electronic Filing Specifications
Section 1.General
Section 2.Electronic Filing Approval Procedure
Section 3.Test Files
Section 4.Electronic Submissions
Section 5.Transmittal Requirements
Section 6.Information Reporting Program Bulletin Board System (IRP–BBS) Specifications
Section 7.IRP–BBS First Logon Procedures
Part E. Magnetic/Electronic Specification for Extensions of Time
Section 1.General Information
Section 2.Magnetic Tape, Tape Cartridge, 5
1
⁄4- and 3
1
⁄2-inch Diskette, and IRP–BBS Specifications
Section 3.Record Layout
Part F. Miscellaneous Information
Section 1.Addresses for MCC
Section 2.Phone Numbers for Contacting IRS/MCC Magnetic Media Reporting Program/ Information Returns Branch
Section 3.Preparation Instructions for External Label
Section 4.Related Forms for Filing Information Returns Magnetically/Electronically

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Part A. General
Revenue procedures are generally
revised annually to reflect legislative
and form changes. Comments concern-
ing this revenue procedure, or sugges-
tions for making it more helpful, can
be addressed to:
Internal Revenue Service
Martinsburg Computing Center
Attn: IRB, Information Support
Section
P. O. Box 1359, MS–360
Martinsburg, WV 25401
Sec. 1. Purpose
.01The purpose of this revenue
procedure is to provide the specifica-
tions for filing Forms 1098, 1099
series, 5498, and W–2G electronically
or on magnetic media, which includes
1
⁄2-inch magnetic tape; IBM 3480, 3490
or AS400 compatible tape cartridges;
or 5
1
⁄4- and 3
1
⁄2-inch diskettes with IRS.
IRS/MCC has discontinued processing
8-inch diskettes. This revenue proce-
dure must be used for the preparation
of Tax Year 1996 information returns
and information returns for years prior
to 1996 that are required to be filed.
This revenue procedure must be used to
prepare current and prior year informa-
tion returns filed between January 1,
1997, and December 31, 1997. Specifi-
cations for filing the following forms
a r e c o n t a i n e d i n t h i s r e v e n u e
procedure.
(a)Form 1098, Mortgage Interest
Statement.
(b)Form 1099–A, Acquisition or
Abandonment of Secured
Property.
(c)Form 1099–B, Proceeds from
Broker and Barter Exchange
Transactions.
(d)Form 1099–C, Cancellation
of Debt.
(e)Form 1099–DIV, Dividends
and Distributions.
(f)Form 1099–G, Certain Gov-
ernment Payments.
(g)Form 1099–INT, Interest
Income.
(h)F o r m 1 0 9 9 – M I S C , M i s -
cellaneous Income.
(i)Form 1099-OID, Original Is-
sue Discount.
(j)Form 1099–PATR, Taxable
Distributions Received from
Cooperatives.
(k)Form 1099–R, Distributions
from Pensions, Annuities, Re-
tirement or Profit-Sharing
Plans, IRAs, Insurance Con-
tracts, etc.
(l)
Form 1099–S, Proceeds from
Real Estate Transactions.
(m)Form 5498, Individual Retire-
m e n t A r r a n g e m e n t
Information.
(n)Form W–2G, Certain Gam-
bling Winnings.
.02Specifications for filing Forms
W–2 on magnetic media are available
from the Social Security Administration
(SSA) only. Filers can call 1-800-
SSA-1213 to obtain the phone number
of the SSA Magnetic Media Coordina-
tor for their area.
.03The Internal Revenue Service,
Martinsburg Computing Center (IRS/
MCC) has the responsibility for proc-
essing Forms 1098, 1099 series, 5498,
and W–2G filed magnetically or
electronically. IRS/MCC does not proc-
ess Forms W–2. Paper and/or magnetic
media for Forms W–2 must be sent to
SSA. IRS/MCC does, however, process
waiver requests (Form 8508) and ex-
tension of time requests (Form 8809)
for filing Forms W–2.
.04In most cases, the box numbers
on the paper forms correspond with the
amount codes used to file magnetically/
electronically; however, if discrepan-
cies occur, the instructions in this
revenue procedure govern.
.05This revenue procedure also
provides the requirements and specifi-
c a t i o n s f o r m a g n e t i c m e d i a o r
electronic filing under the Combined
Federal/State Filing Program.
.06The following revenue proce-
dures and publications provide more
detailed filing procedures for certain
other information returns.
(a)1996 ‘‘Instructions for Forms
1099, 1098, 5498, and W–
2G’’ provides specific in-
structions on completing and
submitting information re-
turns to IRS.
(b)Rev. Proc. 84–33, 1984–1
C.B. 502, regarding the op-
tional method for agents to
report and deposit backup
withholding.
(c)Publication 1179, Rules and
Specifications for Private
Printing of Substitute Forms
1096, 1098, 1099 Series,
5498, and W–2G.
(d)Publication 1239, Specifica-
tions for Filing Form 8027,
Employer’s Annual Informa-
tion Return of Tip Income
and Allocated Tips, on Mag-
netic Tape and 5
1
⁄4- or 3
1
⁄2-
inch Diskettes.
(e)Publication 1187, Specifica-
tions for Filing Form 1042–S,
Foreign Person’s U.S. Source
Income Subject to Withhold-
ing, Electronically or on
Magnetic Tape, and 5
1
⁄4- or
3
1
⁄2-inch Magnetic Diskettes.
(f)Publication 1245, Specifica-
tions for Filing Form W–4,
Employee’s Withholding Al-
lowance Certificate, on Mag-
netic Tape, and 5
1
⁄4- or 3
1
⁄2-
inch Magnetic Diskette.
.07This revenue procedure super-
sedes Rev. Proc. 95–29 and 95–29A
published as Publication 1220 (Rev. 6–
95), Specifications for Filing Forms
1098, 1099, 5498, and W–2G Magnet-
ically or Electronically.
.08Refer to Part A, Sec. 17, for
definitions of terms used in this
publication.
Sec. 2. Nature of Changes—Current
Year (Tax Year 1996)
.01In this publication, all pertinent
changes for Tax Year 1996 have been
emphasized by the use of italics. This
has been done for the convenience of
the filers in identifying new informa-
tion. Filers are still advised to read the
publication in its entirety.
.02Programming Changes
a. Payer/Transmitter ‘‘A’’ Record
Changes:
(1)For all forms, Payment Year,
Field Positions 2–3 must be incre-
mented by one (from 95 to 96) unless
reporting prior year data.
b. Payer/Transmitter ‘‘B’’ Record
Changes:
(1)For all forms, Payment Year,
Field Positions 2–3 must be incre-
mented by one (from 95 to 96) unless
reporting prior year data.
(2)Part B, Sec. 8: For Form
1099–R Distribution Codes, Field Posi-
tions 4–5, acceptable combinations of
numeric distribution codes now include
codes 8 and 4.
(3)Part B, Sec. 8: For Form 5498,
a SEP Indicator has been added in
Field Position 44.
.03Editorial Changes—General
(a)Eight inch diskette processing
has been eliminated by IRS/MCC. All
references to 8-inch diskette processing
h a v e b e e n d e l e t e d f r o m t h i s
publication.
(b)Part A, Sec. 4.04 was included
to inform payers of electronic filing

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methods; i.e., Mainframe and Informa-
tion Reporting Program Bulletin Board
System (IRP–BBS) electronic filing,
and a brief overview of options avail-
able on the IRP–BBS.
(c)Part A, Sec. 5.14: Instructions
have been added for obtaining an
automatic waiver for filing Form 5498
for participants of Operation Joint
Endeavor (Bosnia Region).
(d)Part A, Sec. 7.01: A chart has
been added to clarify the guidelines for
applications for a transmitter control
code (TCC).
(e)Part A, Sec. 12.02 and 12.03:
Information has been added regarding
the Media Tracking Slip (Form 9267)
which accompanies media returned to
filers due to processing problems.
(f)Part A, Sec. 17: The Definition
of Terms section has been expanded.
(g)Part B, Sec. 3.01(a): Tape car-
tridge specifications have been ex-
panded to include IBM 3490E as
acceptable media.
(h)Part F: Information in this part
has been provided as a quick reference
point for addresses and telephone num-
bers for IRS/MCC.
(i)Numerous statements have been
added and bolded throughout the pub-
lication instructing filers not to report
duplicate data which may result in
erroneous penalty notices being
generated.
.04 Editorial Changes—Magnetic
Media Specifications
(a)Part B, Sec. 4: 8mm (.315-inch)
tape cartridge specifications have been
added. This is a pilot program for
transmitters with AS400 operating sys-
tems only.
(b)Part B, Sec. 6: Instructions have
been included for reporting IRA contri-
butions for Operation Joint Endeavor
(Bosnia Region) participants.
(c)Part B, Sec. 6, Payer/Transmitter
‘‘A’’ Record—General Field Descrip-
tions—Field Positions 23–31, Form
5498: A note was added directing the
filer to enter ‘‘1’’ in the IRA/SEP
Indicator Field (position 44 of the
Payee ‘‘B’’ Record) for a simplified
employee pension (SEP).
(d)Part B, Sec. 8: A separate Payee
‘‘B’’ Record Layout Position 322–420,
has been created for Form 1099–R.
(e)Part B, Sec. 8, Payee ‘‘B’’ Field
Positions 4–5, Document Specific
Code/Distribution Code for the Tax
Year of Refund for 1099–G: A state-
ment has been added to instruct filers
to report the distribution code that
reflects the tax year for which the
REFUND was made, not 1996. Refund
Years have been added to identify the
valid corresponding code.
(f)Part B, Sec. 8, Payee ‘‘B’’
Record General Field Descriptions and
Record Layout—IRA/SEP Indicator,
Field Position 44: Text was added to
the Description and Remarks to enter
‘‘1’’ for Form 5498 if reporting a
contribution to a simplified employee
pension (SEP). A note was also added
to reflect the change.
(g)Part C, Sec. 6: IBM 3780
Bisynchronous communication has
been expanded to include the specifica-
t i o n s a n d c i r c u i t n u m b e r o f
304-264-7045 for Hayes OPTIMA 288
V.FC Smartmodem for 14400 bps
transmissions.
(h)Part C, Sec. 7: A Type of File
Indicator has been added in Field
Position 44 for Extension File in the
Bisynchronous Electronic Filing Record
Specifications.
(i)Part E, Sec. 3, RECORD LAY-
OUT, Field Positions 6–14: Reference
to the Foreign Entity Indicator has been
corrected to read, Field Position 176,
must be set to ‘‘X.’’
Sec. 3. Where to File and How to
Contact the IRS, Martinsburg
Computing Center (MCC)
.01 All information returns filed
magnetically or electronically are proc-
essed at IRS/MCC. Files containing
information returns, requests for IRS
magnetic media and electronic filing
information, undue hardship waivers,
and requests for extensions of time to
file returns or to furnish the statements
to recipients are to be sent to the
following addresses:
)
If by Postal Service:
IRS-Martinsburg Computing Center
P. O. Box 1359, MS-360
Martinsburg, WV 25401-1359
or
(
If by truck or air freight:
IRS-Martinsburg Computing Center
Information Reporting Program
Route 9 and Needy Road, MS-360
Martinsburg, WV 25401
.02Send a magnetically filed exten-
sion of time request to one of the
following addresses:
If by Postal Service:)
I R S - M a r t i n s b u r g C o m p u t i n g
Center
A t t n : E x t e n s i o n o f T i m e
Coordinator
P. O. Box 879, MS-360
Kearneysville, WV 25430
If by truck or air freight: (
I R S - M a r t i n s b u r g C o m p u t i n g
Center
A t t n : E x t e n s i o n o f T i m e
Coordinator
Route 9 and Needy Road, MS-360
Martinsburg, WV 25401
.03Inquiries may be made between
8:30 a.m. and 4:30 p.m. Eastern time.
The telephone numbers for magnetic
media inquiries or electronic submis-
sions are:
=
304-263-8700—Call Site—PART A,
Sec 3.19
304-264-7070—IRP–BBS (Informa-
tion Reporting Program Bulletin
Board System)—PART D
3 0 4 - 2 6 4 - 7 0 8 0 — 4 . 8 M o d e m s —
PART C
3 0 4 - 2 6 4 - 7 0 4 0 — 9 . 6 M o d e m s —
PART C
3 0 4 - 2 6 4 - 7 0 4 5 — 1 4 . 4 M o d e m s —
PART C
3 0 4 - 2 6 7 - 3 3 6 7 — T D D ( T e l e c o m -
munication Device for the Deaf)
304-264-5602—FAX MACHINE
(These are not toll-free telephone
numbers.)
TO OBTAIN FORMS, CALL:
1 - 8 0 0 - T A X - F O R M ( 1 - 8 0 0 -
829-3676)
.04The 1996 ‘‘Instructions for
Forms 1099, 1098, 5498, and W–2G’’
have been included in the Publication
1220 for transmitter convenience. The
Form 1096 is used only to transmit
Copy A of paper Forms 1099, 1098,
5498, and W–2G. If filing paper
returns, follow the mailing instructions
on the Form 1096 and submit the paper
returns to the appropriate IRS Service
Center.
.05Requests for paper Forms 1096,
1098, 1099 and W–2G, and publica-
tions unrelated to magnetic media/
electronic filing should be requested by
calling the ‘‘Forms Only Number’’
listed in your local telephone directory
or by calling the IRS toll-free number
1-800-TAX-FORM (1-800-829-3676).
.06Questions pertaining to magnetic
media filing of Forms W–2 must be

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directed to the Social Security Admin-
istration (SSA). Filers can call 1-800-
SSA-1213 to obtain the phone number
of the SSA Magnetic Media Coordina-
tor for their area.
.07Payers should not contact IRS/
MCC if they have received a penalty
notice and need additional information,
or are requesting an abatement of the
penalty. Penalty notices contain an IRS
representative’s name and/or phone
number for contact purposes; or, the
payer may be instructed to respond in
writing to the address provided. IRS/
MCC does not issue penalty notices
and does not have the authority to
abate penalties. For penalty informa-
tion, refer to the Penalty section of
1996 ‘‘Instructions for Forms 1099,
1098, 5498, and W–2G.’’
.08A taxpayer or authorized repre-
sentative may request a copy of a tax
return or a Form W–2 filed with a
return by submitting Form 4506, Re-
quest for Copy or Transcript of Tax
Form, to IRS. This form may be ob-
tained by calling 1-800-TAX-FORM
(1-800-829-3676).
.09The IRS Centralized Call Site
answers both magnetic media and tax
law questions relating to the filing of
information returns (Forms 1096, 1098,
1099, 5498, 8027, W–2, W–2G, W–3,
Questionable W–4’s, and 1042S). The
IRS/MCC Call Site also handles in-
quiries dealing with backup withhold-
ing due to missing and incorrect
taxpayer identification numbers. The
Call Site is located at IRS/MCC and
operates in conjunction with the Infor-
mation Reporting Program. The Call
Site provides service to the payer
community (financial institutions,
employers, and other transmitters of
information returns). Recipients of in-
formation returns (payees) should con-
tinue to contact 1-800-829-1040 or
other numbers specified in the tax
return instructions with any questions
on how to report information returns.
The Call Site accepts calls from all
areas of the country. The number to
call is 304-263-8700 or Telecom-
munications Device for the Deaf
(TDD) 304-267-3367. These are toll
calls. Hours of operation for the Call
Site are Monday through Friday, 8:30
a.m. to 4:30 p.m. Eastern Time. The
Call Site is in operation throughout the
year to handle payers’, transmitters’,
and employers’ questions. Due to the
high demand for assistance at the end
of January and February, it is advisable
to call as soon as possible to avoid
these peak filing seasons.
Sec. 4. Filing Requirements
.01Under section 6011(e)(2)(A) of
the Internal Revenue Code, any person,
including a corporation, partnership,
individual, estate, and trust, who is
required to file 250 or more informa-
tion returns must file such returns
magnetically/electronically. The 250 or
more requirement applies separately
for each type of return and also to
each type of corrected return. Even
though payers may not be required to
file magnetically/electronically, IRS en-
courages them to do so.
.02All filing requirements that fol-
low apply individually to each report-
ing entity as defined by its separate
Taxpayer Identification Number (TIN)
[Social Security Number (SSN), or
E m p l o y e r I d e n t i f i c a t i o n N u m b e r
(EIN)]. For example, if a corporation
with several branches or locations uses
the same EIN, the corporation must
aggregate the total volume of returns to
be filed for that EIN and apply the
filing requirements to each type of
return accordingly.
.03Payers who are required to sub-
mit their information returns on mag-
netic media may choose to submit their
documents by electronic filing. Payers
who submit their information returns
electronically are considered to have
satisfied the magnetic media filing
requirements.
.04IRS/MCC has two methods by
which payers may submit their files
electronically. Bisynchronous (main-
frame) electronic filing, which can be
found in Part C of this publication, or
Asynchronous (Information Reporting
Program Bulletin Board System), which
is in Part D. An overview of some
features provided on the IRP-BBS are
as follows:
●Electronic filing of information
returns to the IRS using dial-up
modems
●Return notification of the accept-
ability of the data transmitted
within 24 to 48 hours
●Electronic communication with
IRS and Social Security bulletin
board systems
●Access to information reporting
publications
●Access to shareware
●Access to forms relating to the
Information Reporting Program
●News about the latest changes and
updates that affect the Information
Reporting Program at IRS
●Answers to messages and ques-
tions left on the bulletin board
●IRP–BBS is available for public
use and can be reached by dialing
304-264-7070
●Telephone lines are available 24
hours a day, 7 days a week.
Routine maintenance is performed
daily, at approximately 7:00 a.m.
Eastern Time Zone.
●Questions, comments, or sugges-
tions can be directed to the
S y s t e m s O p e r a t o r ( S Y S O P )
through IRP–BBS.
.05The following requirements ap-
ply separately to both originals and
c o r r e c t i o n s f i l e d m a g n e t i c a l l y /
electronically:
1098
1099–A
1099–B
1099–C
1099–DIV
1099–G
1099–INT
1099–MISC
1099–OID
1099–PATR
1099–R
1099–S
5498
W–2G
250 or more of any of
these forms require mag-
netic media or electronic
filing with IRS. These are
stand alone documents
and are not to be aggre-
gated for purposes of de-
termining the 250 thresh-
old. For example, if you
must file 100 Forms
1099–B and 300 Forms
1099–INT, Forms 1099–B
need not be filed magnet-
ically or electronically
since they do not meet the
threshold of 250. How-
ever, Forms 1099–INT
must be filed magnetically
or electronically since
they meet the threshold of
250.
.06The above requirements do not
apply if the payer establishes undue
hardship (see Part A, Sec. 5).
Sec. 5. Form 8508, Request for
Waiver from Filing Information
Returns on Magnetic Media
.01If a payer is required to file on
magnetic media but fails to do so (or
fails to file electronically, in lieu of
magnetic media filing) and does not
have an approved waiver on record, the
payer will be subject to a penalty of
$50 per return. (For penalty informa-
tion, refer to the Penalty section of the
1996 ‘‘Instructions for Forms 1099,
1098, 5498, and W–2G.’’)

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.02If payers are required to file
original or corrected returns on mag-
netic media, but such filing would
create an undue hardship, they may
request a waiver from these filing
requirements by submitting Form 8508,
Request for Waiver From Filing Infor-
mation Returns on Magnetic Media, to
IRS/MCC.
.03Even though a payer may submit
up to 249 corrections on paper, IRS/
MCC encourages magnetically or
electronically submitted corrections.
Once the 250 threshold has been met,
filers are required to submit any returns
of 250 or more magnetically or elec-
tronically. However, if a waiver for
original documents is approved, any
corrections for the same type of returns
will be covered under this waiver.
.04Generally, only the payer may
sign the Form 8508. A transmitter may
sign if given power of attorney; how-
ever, a letter signed by the payer
stating this fact must be attached to the
Form 8508.
.05A transmitter must submit a
separate Form 8508 for each payer.
Do not submit a list of payers.
.06All information requested on the
Form 8508 must be provided to IRS for
the request to be processed.
.07The waiver, if approved, will
provide exemption from magnetic me-
dia filing for the current tax year only.
Payers may not apply for a waiver for
more than one tax year at a time;
application must be made each year a
waiver is necessary.
.08Form 8508 may be photocopied
or computer-generated as long as it
contains all the information requested
on the original form.
.09Filers are encouraged to submit
Form 8508 to IRS/MCC at least 45
days before the due date of the returns.
However, new brokers and new barter
exchanges may request an undue hard-
ship waiver by the end of the second
month following the month in which
they became a broker or barter
exchange.
.10File Form 8508 for Forms W–2
with IRS/MCC, not SSA.
.11Waivers are evaluated on a case-
by-case basis and are approved or
denied based on criteria set forth under
section 6011(e) of the Internal Revenue
Code. The transmitter must allow a
minimum of 30 days for IRS/MCC to
respond to a waiver request.
.12If a waiver request is approved,
the transmitter should keep the ap-
proval letter on file. The transmitter
should not send a copy of the ap-
proved waiver to the service center
where the paper returns are filed.
.13An approved waiver from fil-
ing information returns on magnetic
media does not provide exemption
from all filing. The payer must timely
file information returns on acceptable
paper forms with the appropriate sub-
mission processing site.
.14Desert Storm/Operation Joint
E n d e a v o r ( B o s n i a R e g i o n )
Contributions—If a payer is required
to file a Form 5498 magnetically/
electronically, the payer may request an
automatic waiver to file Forms 5498
on paper for participants of Desert
Storm or Operations Joint Endeavor.
The payer should clearly mark Desert
Storm or Operations Joint Endeavor on
the waiver request form.
Sec. 6. Vendor List
.01IRS/MCC prepares a list of
vendors who support magnetic media
or electronic filing. The Vendor List
(Pub. 1582) contains the names of
service bureaus that will produce files
on the prescribed types of magnetic
media or via electronic filing. It also
contains the names of vendors who
provide software packages for payers
who wish to produce magnetic media
or electronic files on their own com-
puter systems. This list is provided,
upon request, as a courtesy and in no
way implies IRS/MCC approval or
endorsement.
*Note:If filers meet the filing
requirements and engage a
service bureau to prepare
media on their behalf, the
filers should be careful not
to report duplicate data,
which may cause penalty
notices to be generated.
.02A payer may request a Vendor
List (Pub. 1582) by contacting IRS/
MCC at 304-263-8700 or by way of
letter (see Part A, Sec. 3). This in-
formation is also available from the
Information Reporting Program Bul-
letin Board System (refer to Part D).
Vendor names will not be provided
over the telephone.
.03A vendor, who offers a software
package, has the ability to produce
magnetic media for customers, or has
the capability to electronically file
information returns, and would like to
be included on the list, must submit a
written request to IRS/MCC. The re-
quest should be submitted by August
15 and must include:
(a)Company name
(b)Address (include city, state,
and ZIP code)
(c)Telephone number (include
area code)
(d)Contact person
(e)Type(s) of service provided
(e.g., service bureau and/or
software)
(f)Type(s) of media offered
(e.g., magnetic tape or tape
cartridge, 5
1
⁄4- or 3
1
⁄2-inch
diskettes, or electronic filing)
(g)Type of return
.04The vendor list is updated an-
nually. Therefore, any changes to infor-
mation already on the vendor list must
also be received by IRS/MCC no later
than August 15 to be included on the
most current vendor list.
Sec. 7. Form 4419, Application for
Filing Information Returns
Magnetically/Electronically
.01Transmitters are required to sub-
mit Form 4419, Application for Filing
Information Returns Magnetically/
Electronically, to request authorization
to file information returns with IRS/
MCC. A single Form 4419 should be
filed no matter how many types of
returns the transmitter will be submit-
ting magnetically/electronically. For ex-
ample, if a transmitter plans to file
Forms 1099–INT, one Form 4419
should be submitted. If, at a later date,
another type of form is to be filed, the
transmitter does not need to submit a
new Form 4419.

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EXCEPTIONS
An additional Form 4419 is required for filing each of the following types of returns: Forms 1042–S, 8027, and
Questionable W–4.
FORMTITLEEXPLANATION
1042–SForeign Person’s U.S. Source
Income Subject to Withholding
Payments subject to withholding under Chapter 3 of the Code,
including interest, dividends, royalties, pensions and annuities,
gambling winnings and compensation for personal services.
8027Employer’s Annual Information
Return of Tip Income and
Allocated Tips
Receipts from food or beverage operations, tips reported by
employees, and allocated tips.
Questionable W–4
(See Note)
Employee’s Withholding Al-
lowance Certificate
Forms received during the quarter from employees still
employed at the end of the quarter who claim the following:
(a)More than 10 withholding allowances or
(b)Exempt status and wages normally would be more than
$200 a week.
*Note:Employers are not required to send other Forms W–4 unless notified to do so by the IRS.
I f f i l e r s w i s h t o r e p o r t b o t h
electronically and magnetically, only
one Form 4419 needs to be submitted.
.02Magnetic tape, tape cartridge,
diskette, and electronically-filed returns
may not be submitted to IRS/MCC
until the application has been approved.
Please read the instructions on the back
of Form 4419 carefully. A Form 4419
is included in the Publication 1220 for
the filer’s use. This form may be
photocopied. Additional forms may be
obtained by calling 1-800-TAX-FORM
(1-800-829-3676).
.03Upon approval, a five-character
alpha/numeric Transmitter Control
Code (TCC) will be assigned and
included in an approval letter. The
TCC must be coded in the Payer ‘‘A’’
Record. If a transmitter uses more than
one TCC to file, each TCC must be
reported on separate media or in
s e p a r a t e t r a n s m i s s i o n s i f f i l i n g
electronically.
.04A magnetic media reporting
package containing the current revenue
procedure, forms, and instructions will
be sent to the attention of the contact
person indicated on Form 4419. This
package will be sent annually.
.05If any of the information on the
Form 4419 changes, please notify IRS/
MCC in writing so that the IRS/MCC
database can be updated. The transmit-
ter should include the TCC in all
correspondence.
.06Form 4419 can be submitted at
any time during the year; however, it
must be submitted to IRS/MCC at least
30 days before the due date of the
return(s). For documents to be filed
electronically using IBM 3780 bi-
synchronous protocols, Form 4419
must be submitted at least 45 days
prior to the due date of the returns
(See Part C, Sec. 2). This will allow
IRS/MCC the minimum amount of time
necessary to process and respond to
applications. In the event that computer
equipment or software is not compat-
ible with IRS/MCC, a waiver may be
requested to file returns on paper
documents.
.07IRS/MCC encourages transmit-
ters who file for multiple payers to
submit one application and to use the
assigned TCC for all payers. Include a
list of all payers and TINs with the
Form 4419. Transmitters are en-
couraged to provide an updated list to
IRS/MCC annually.
.08If a payer’s files are prepared by
a service bureau, the payer may not
need to submit an application to obtain
a TCC. Some service bureaus will pro-
duce files, code their own TCC on the
media, and send it to IRS/MCC for the
payer. Other service bureaus will pre-
pare magnetic media and return the
media to the payer for submission to
IRS/MCC. These service bureaus may
require the payer to obtain a TCC to be
coded in the ‘‘A’’ Record. Payers
should contact their service bureaus for
further information.
.09Once a transmitter is approved
to file magnetically or electronically, it
is not necessary to reapply each year
unless:
(a)The payer has discontinued
filing magnetically or elec-
tronically for three years; the
payer’s TCC may have been
reassigned by IRS/MCC.
(b)The payer’s magnetic media
files were transmitted in the
past by a service bureau
using the service bureau’s
TCC, but now the payer has
computer equipment compat-
ible with that of IRS/MCC
and wishes to prepare his or
her own files. The payer must
request a TCC by filing Form
4419.
.10One Form 4419 may be submit-
ted regardless of how many types of
media or methods used to file the
return. A payer may apply for more
than one TCC, but must code only one
TCC per media. Notify IRS/MCC of
any TCCs that will not be used so
these numbers may be reassigned.
.11In accordance with Regulations
section 1.6041–7(b), payments by sepa-
rate departments of a health care carrier
to providers of medical and health care
services may be reported on separate
returns on magnetic media. In this case,
the headquarters will be considered the
transmitter, and the individual depart-
ments of the company filing reports
will be considered payers. A single
Form 4419 covering all departments
filing on magnetic media should be
submitted. One TCC may be used for
all departments.
.12Approval to file does not imply
endorsement by IRS/MCC of the com-
puter software or of the quality of tax
preparation services provided.
Sec. 8. Test Files
.01IRS/MCC does not require test
files, except for filers wishing to

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participate in the Combined Federal/
State Filing Program (see Part A, Sec.
16, for further information concerning
the Combined Federal/State Filing
Program).
.02IRS/MCC encourages first-time
magnetic media or electronic filers to
submit a test. The test file should
consist of a sample of each type of
record:
(a)Payer ‘‘A’’ Record (must not
be fictitious data)
(b)Multiple Payee ‘‘B’’ Records
(at least 11 ‘‘B’’ Records
per each ‘‘A’’ Record)
(c)End of Payer ‘‘C’’ Record
(d)State Totals ‘‘K’’ Record, if
participating in the Combined
Federal/State Filing Program
(e)End of Transmission ‘‘F’’
Record
See PART B for record formats.
.03Use the Test Indicator in the
‘‘A’’ Record to show that this is a test
file.
.04IRS/MCC will check the file to
ensure it meets the specifications of
this revenue procedure. For current
filers, sending a test file will provide
the opportunity to ensure that their
software reflects any programming
changes.
If unable to submit a magnetic or
electronic test file, a hardcopy printout
that shows a sample of each record
type (A, B, C, and F) may be sub-
mitted. The hard copy print test is
not acceptable for Combined Federal/
State Filing approval.
.05Tests should be sent to IRS/
MCC between November 1 and De-
cember 31. The test file must be
received at MCC by December 31 in
order to be processed. Filers may begin
submitting test tapes and diskettes after
October 1; however, the data will not
be processed until on or after Novem-
ber 1.
.06For tests filed electronically, the
transmitter must send the signed Form
4804, Transmittal of Information Re-
turns Reported Magnetically/Elec-
tronically, the same day the transmis-
sion is made. For tests filed on
magnetic tape, tape cartridge, 5
1
⁄4- and
3
1
⁄2-inch diskette, the transmitter must
include the signed Form 4804 in the
same package with the corresponding
magnetic media. Mark the ‘‘TEST’’
box in block 1 on the form. Also,
check ‘‘TEST’’ on the external media
label.
If submitting a hard copy printout,
mark the printout as ‘‘TEST’’ and
include name, telephone number, and
address of a person who can be
contacted to discuss its acceptability.
.07IRS/MCC will send a letter of
acknowledgment to indicate the test
results. Unacceptable magnetic media
files, along with documentation identi-
fying the errors, will be returned.
Resubmission of test files must be
received by IRS/MCC no later than
December 31.
.08Successfully processed media
will not be returned to filers.
Sec. 9. Filing of Information Returns
Magnetically/Electronically and
Retention Requirements
.01Form 4804, Transmittal of Infor-
mation Returns Reported Magnetically/
Electronically, Form 4802, Transmittal
of Information Returns Reported
Magnetically/Electronically (Continua-
tion), or computer-generated substitute,
must accompany all magnetic media
shipments. For electronic transmissions,
the Form 4804 and Form 4802, if ap-
plicable, must be sent the same day as
the electronic transmission. Form 4802,
Transmittal of Information Returns Re-
ported Magnetically/Electronically
(Continuation), is a continuation of
Form 4804 and should only be used if
the filer is reporting more than four
types of returns and/or more than four
payers. Form 4802 is not a stand-alone
form; it can only accompany Form
4804.
.02IRS/MCC encourages the use of
computer-generated substitutes for
Form 4804/4802 (See Note). The sub-
stitutes must contain all information
requested on the original forms includ-
ing the affidavit and signature line.
Photocopies are acceptable but an
original signature is required.
*Note: When using computer-
generated forms, be sure to
very clearly mark which
tax year is being reported.
This will eliminate a phone
communication from IRS/
MCC to question the tax
year.
.03A transmitter may report for any
combination of payers and/or docu-
ments in a submission. For example, if
reporting Forms 1099–INT for Bank A,
Forms 1099–DIV for Bank B, and
Forms 1098 for Bank C, three separate
tapes or diskettes need not be created.
All three banks and all types of docu-
ments can be coded on one tape or
diskette as long as each filing entity or
type of return is separated by an ‘‘A’’
Record. Only one ‘‘F’’ Record may be
used at the end of a transmission.
Multiple tapes or diskettes can be sent
in one package. Filers must include
Form 4804, 4802, or computer-
g e n e r a t e d s u b s t i t u t e w i t h t h e i r
shipment.
.04Multiple types of media may be
submitted in a shipment. However,
submit a separate Form 4804 for each
type of media.
.05Current and prior year data may
be submitted in the same shipment;
however, each tax year must be on
separate media, and a separate Form
4804 must be prepared to clearly
indicate each tax year.
.06Filers who have prepared their
information returns in advance of the
due date are encouraged to submit this
information to IRS/MCC no earlier
than January 1 of the year the return is
due.
.07Do not report duplicate infor-
mation. If a filer submits returns
magnetically/electronically, identical
paper documents must not be filed.
This may result in erroneous penalty
notices.
.08Form 4804 may be signed by the
payer or the transmitter, service bureau,
paying agent, or disbursing agent (all
hereafter referred to as agent), on
behalf of the payer. An agent may sign
the Form 4804 if the agent has the
authority to sign the affidavit under an
agency agreement (either oral, written,
or implied) that is valid under state law
and adds the caption ‘‘FOR: (name of
payer).’’
*Note:Failure to sign the affidavit
on Form 4804 may delay
processing or could result
in the files being returned
unprocessed.
.09Although an authorized agent
may sign the affidavit, the payer is
responsible for the accuracy of the
Form 4804 and the returns filed. The
payer will be liable for penalties for
f a i l u r e t o c o m p l y w i t h f i l i n g
requirements.
.10An external media label, must be
affixed to each tape and diskette. If
diskettes are used, and the operating
system is not MS–DOS compatible, the
operating system and hardware infor-
mation must be provided. Failure to
provide this information may result in
the diskettes being returned to the filer.
For instructions on how to prepare an

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external media label, refer to PART F
‘‘Miscellaneous Information.’’
.11On the outside of the shipping
container, affix or attach a label which
reads IRBofreflecting
the number of containers in the ship-
ment (See labels in PART F). If there
is only one container, mark the outside
as Box 1 of 1. For multiple containers,
include the sequence (for example, Box
1 of 3, 2 of 3, 3 of 3).
.12When submitting files include
the following:
(a) A signed Form 4804;
(b)Form 4802, if applicable;
(c)External media label affixed to
magnetic media;
( d )I R B
o fo u t s i d e
label.
*Note:See Parts C and D for
e l e c t r o n i c s u b m i s s i o n
requirements.
.13If returns from different loca-
tions (using the same name and TIN)
are submitted on the same file, IRS
encourages the filer to consolidate each
type of information return under one
‘‘A’’ Record. For example, all ‘‘B’’
Records for the same type of return
should be together under one ‘‘A’’
Record and followed by the End of
Payer ‘‘C’’ Record.
.14IRS/MCC will not pay for or
a c c e p t ‘ ‘ C a s h - o n - D e l i v e r y ’ ’ o r
‘‘Charge to IRS’’ shipments of tax
information that an individual or orga-
nization is legally required to submit.
.15In general, payers should retain a
copy of the information returns filed
with IRS or have the ability to recon-
struct the data for at least 3 years from
the reporting due date, with the excep-
tion of Form 1099–C. A financial
entity must retain a copy of Form
1099–C, Cancellation of Debt, or have
the ability to reconstruct the data
required to be included on the return,
for at least 4 years from the date such
return is required to be filed. Whenever
backup withholding is imposed, a 4
year retention is required.
Sec. 10. Due Dates
.01The due dates for filing paper
returns with IRS also apply to magnetic
media or electronic filing. Filing of
information returns is on a calendar
year basis, except for Form 5498,
which is used to report amounts con-
tributed during, or after (but not later
than April 15) of the calendar year.
. 0 2I n f o r m a t i o n r e t u r n s f i l e d
magnetically/electronically for Forms
1098, 1099, and W–2G must be sub-
mitted to IRS/MCC postmarked no
later than February 28. If using a
delivery service other than postal serv-
ice, the actual date of receipt by IRS/
MCC will be used as the submission
date. This should be considered in
meeting filing requirements timely.
.03The due date for furnishing
statements to recipients is January 31.
Form 5498 statements are due to the
participants by January 31 for the fair
market value of the account and by
May 31 for contributions made to IRAs
for the prior calendar year.
.04Form 5498 filed magnetically/
electronically must be submitted to
IRS/MCC postmarked no later than
May 31. Form 5498 is filed for con-
tributions to be applied to 1996 that are
made January 1, 1996, through April
15, 1997, and/or to report the fair
market value of the IRA/SEP.
.05If any due date falls on a
Saturday, Sunday, or legal holiday, the
return or statement is considered timely
if filed or furnished on the next day
that is not a Saturday, Sunday, or legal
holiday.
.06Use this revenue procedure to
prepare information returns filed mag-
netically or electronically beginning
January 1, 1997, and received by IRS/
MCC no later than December 31, 1997.
Sec. 11. Extensions of Time
.01An extension of time to file may
be requested for Forms 1099, 1098,
5498, W–2G, W–2, and 1042–S.
.02Form 8809, Request for Exten-
sion of Time to File Information
Returns, should be submitted to IRS/
MCC. This form may be used to re-
quest an extension of time to file
information returns submitted on paper,
magnetically or electronically.
.03Requesting an extension of time
for multiple payers may be done by
submitting Form 8809 and attaching a
list of the payer names and their TINs
(EIN or SSN). The listing must be
attached to ensure that the extension
is recorded for all payers. Form 8809
may be computer-generated or pho-
tocopied. Be sure that all the pertinent
information is included.
.04Requests for an extension of
time to file for more than 50 payers are
required to be submitted magnetically
or electronically (See Note). Requests
for an extension of time for 10 to 50
payers are encouraged to be filed
magnetically or electronically via IRP–
BBS. (See Part E, Sec. 3, for the record
format.) The request may be filed on
tape, tape cartridge, 5
1
⁄4- or 3
1
⁄2-inch
diskette, or electronically through the
IRP–BBS or mainframe.
*Note:Form 4419, Application for
Filing Information Returns
Magnetically/Electronically,
must be completed in order
to file an extension request
magnetically/electronically.
.05A magnetically filed request for
an extension of time should be sent
using the following addresses:
If by Postal Service: )
I R S - M a r t i n s b u r g C o m p u t i n g
Center
A t t n : E x t e n s i o n o f T i m e
Coordinator
P. O. Box 879, MS-360
Kearneysville, WV 25430
If by truck or air freight: (
I R S - M a r t i n s b u r g C o m p u t i n g
Center
A t t n : E x t e n s i o n o f T i m e
Coordinator
Route 9 and Needy Road, MS-360
Martinsburg, WV 25401
.06Requests for extensions of time
for multiple payers will be responded
to with one approval letter, accom-
panied by a list of payers covered
under that approval.
.07As soon as it is apparent that a
30 day extension of time to file is
needed, Form 8809 may be submitted.
It will take a minimum of 30 days for
IRS/MCC to respond to an extension
request. Under certain circumstances a
request for an extension of time could
be denied. When a denial letter is
received, any additional or necessary
information may be resubmitted within
20 days.
.08If an additional extension of
time is needed, a second Form 8809
must be requested before the end of the
initial extension. Line 7 on the form
should be checked to indicate that an
additional extension is being requested.
A second 30-day extension will be
approved only in cases of extreme
hardship or catastrophic events. When
requesting a second 30-day extension
of time, do not hold your files waiting
for a response.
.09 Form 8809 must be post-
marked no later than the due date of

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the return for which an extension is
requested. If requesting an extension
of time to file several types of forms,
use one Form 8809, but the Form
8809 must be postmarked no later
than the earliest due date. For
example, if requesting an extension
of time to file both Forms 1099–INT
and 5498, submit Form 8809 post-
marked on or before February 28.
Complete more than one Form 8809
to avoid this problem.
.10If an extension request is ap-
proved, the approval letter should be
kept on file. (The approval letter or
copy of the approval letter for exten-
sion of time should not be sent to IRS/
MCC with the magnetic media file or
to the service center where the paper
returns are filed.)
.11Request an extension for only
one tax year.
.12The extension request must be
signed by the payer or a person who is
duly authorized to sign a return,
statement or other document for the
payer.
.13Failure to properly complete and
sign the Form 8809 may cause delays
in processing the request or result in a
denial. Carefully read and follow the
instructions on the back of the Form
8809.
.14Form 8809 may be obtained by
calling 1-800-TAX-FORM (1-800-
829-3676).
.15Request an extension of time to
furnish the statements to recipient of
Forms 1098, 1099, 5498, W–2G, W–2,
and 1042–S by submitting a letter to
IRS/MCC or to the payer’s local
District Director containing the follow-
ing information:
(a)Payer Name
(b) TIN
(c)Address
(d)Type of Return
(e)Specify that the extension re-
quest is to provide statements
to recipients.
(f)Reason for Delay
(g)Signature of Payer or Person
Duly Authorized
Requests for an extension of time to
furnish the statements of Forms 1098,
1099, 5498, W–2G, W–2, and 1042–S
to recipients are not automatically
approved; however, if approved, gener-
ally an extension will allow a max-
imum of 30 additional days from the
due date to furnish the statements to
the recipients. If the request is denied,
the statements must be sent to the
recipients timely. The request must be
postmarked by the date on which the
statements are due to the recipients.
Sec. 12. Processing of Information
Returns Magnetically/Electronically
.01All data received at IRS/MCC
for processing will be given the same
protection as individual income tax
returns (Form 1040). IRS/MCC will
process the data and determine if the
records are formatted and coded ac-
cording to this revenue procedure.
.02If the data is formatted incor-
rectly, the file will be returned for
replacement accompanied with a Media
Tracking Slip (Form 9267). If media is
returned, it is because IRS/MCC en-
countered errors (not limited to format)
and was unable to process the media,
therefore, requiring a replacement.
Open all packages immediately.
.03Files must be corrected and
returned with the Media Tracking Slip
(Form 9267) to IRS/MCC within 45
days from the date of the letter IRS/
MCC included with the returned files.
A penalty for failure to file correct
information returns by the due date will
be assessed if the files are not cor-
rected and returned within the 45 days
or if the incorrect files are returned
by IRS/MCC for replacement more
than two times. A penalty for inten-
tional disregard of filing requirements
will be assessed if a replacement file is
not received. (For penalty information,
refer to the Penalty section of the 1996
‘‘Instructions for Forms 1099, 1098,
5498, and W–2G.’’) When possible,
IRS/MCC may return only the portion
of the file that needs replacement.
.04Sample records identifying errors
encountered will be provided with the
returned media. It is the responsibility
of the transmitter to check the entire
file for similar errors.
.05The following definitions have
been provided to help distinguish be-
tween a correction and a replacement:
●A correction is an information
return submitted by the transmitter
to correct an information return
that was previously submitted to
IRS/MCC, but contained er-
roneous information.
●A replacement is an information
return file that IRS/MCC has
returned to the transmitter due to
errors encountered during process-
ing. After necessary changes have
been made, the file must be re-
turned for processing along with
the blue and white Media Track-
ing Slip (Form 9267) which was
included in the shipment from IRS/
MCC.
●Filers should never send any-
thing to IRS/MCC marked ‘‘RE-
PLACEMENT’’ unless IRS/
MCC returned media to them.
.06IRS/MCC will not return media
after successful processing. Therefore,
if the transmitter wants proof that IRS/
MCC received a shipment, the trans-
mitter should select a service with
tracing capabilities or one that will
provide proof of delivery.
.07IRS/MCC will work with filers
as much as possible to assist with
processing problems.
*Note:If the filer is contacted by
IRS/MCC, a prompt re-
sponse is important. IRS/
MCC may have informa-
tion that the filer needs to
correct his or her file.
.08IRS/MCC contacts payers who
have submitted payee data with missing
TINs in an attempt to prevent errors
that could result in penalties. Payers
who submit data with missing TINs
and have taken the required steps to
obtain this information are encouraged
to attach a letter of explanation to the
required Form 4804. This will prevent
unnecessary contact from IRS/MCC.
This letter, however, will not prevent
backup withholding notices (CP2100 or
CP2100A Notices) or penalties for
missing or incorrect TINs.
.09Do not use special shipping con-
tainers for transmitting data to IRS/
MCC. Shipping containers will not be
returned.
Sec. 13. Corrected Returns
.01The magnetic media filing re-
quirements of 250 information returns
applies separately to both original and
corrected returns.
E
X
A
M
P
L
E
If a payer has 100 Forms 1099–A to
be corrected, they can be filed on
paper since they fall under the 250
threshold. However, if the payer has
300 Forms 1099–B to be corrected,
they must be filed magnetically or
electronically since they meet the
250 threshold. If for some reason a
payer cannot file the 300 corrections
on magnetic media, to avoid penal-
ties, a request for a waiver must be
submitted before filing on paper. No
waiver is required for corrections that
fall under the required threshold.

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.02Corrections should be filed as
soon as possible. Corrections filed
after August 1 may be subject to the
maximum penalty of $50 per return.
Corrections filed prior to August 1 may
be subject to a lesser penalty. (For
information on penalties, refer to the
Penalty Section of the 1996 ‘‘Instruc-
tions for Forms 1099, 1098, 5498, and
W–2G.’’) However, if payers discover
errors after August 1, they may still be
required to file corrections so that they
will not be subject to a penalty for
intentional disregard of the filing re-
quirements. Failure to correct informa-
tion returns may result in penalties for
failure to provide correct information.
All fields must be completed with the
correct information, not just the data
fields needing correction. Submit cor-
rections only for the returns filed in
error, not the entire file. Furnish
corrected statements to recipients as
soon as possible.
.03There are numerous types of
errors, and in some cases, more than
one transaction may be required to
correct the initial error. If the original
return was filed as an aggregate, the
filers must consider this in filing
corrected returns.
.04Corrected returns may be in-
cluded on the same medium as original
returns; however, separate ‘‘A’’ Rec-
ords are required. Corrected returns
must be identified on the Form 4804
and the external media label by indicat-
ing ‘‘Correction.’’
*Note:If filers discover that cer-
tain information returns
were omitted on their
original file, they must
not submit these docu-
ments as corrections.
They must submit them
as originals.
.05If a payer discovers errors for
prior years that affect a large number
of payees, in addition to sending IRS
the corrected returns and notifying the
payees, a letter containing the follow-
ing information should be sent to IRS/
MCC:
(a) Name and address of payer
(b)Type of error (please explain
clearly)
(c) Tax year
(d) Payer TIN
(e) TCC
(f) Type of Return
(g) Number of Payees
This information will be forwarded
to the appropriate office in an attempt
to prevent erroneous notices from being
sent to the payees. The correction must
be submitted on an actual information
return document or filed magnetically/
electronically. Provide the correct tax
year in Box 2 of the Form 4804 and
the external media label.
.06Prior year data, original and
corrected, must be filed according to
the requirements of this revenue proce-
dure. If submitting prior year correc-
tions, use the record format for the
current year and submit on separate
media. However, use the actual year
designation of the correction in field
positions 2–3. If filing electronically, a
separate transmission must be made for
each tax year.
.07In general, filers should submit
corrections for returns to be filed
within the last three calendar years
(four years if the payment is a report-
able payment subject to backup with-
holding under section 3406 of the
Code).
.08All paper returns, whether origi-
nal or corrected, must be filed with the
appropriate service center.
.09Form 4804 and Form 4802, must
be submitted with corrected files sub-
mitted magnetically or electronically.
.10The ‘‘B’’ Record provides a 20-
position field for the Payer’s Account
Number for the Payee. This number
will help identify the appropriate incor-
rect return if more than one return is
filed for a particular payee. Do not
enter a TIN in this field. A payer’s
account number for the payee may be a
checking account number, savings ac-
count number, serial number, or any
other number assigned to the payee by
the payer that will distinguish the
specific account. This number should
appear on the initial return and on the
corrected return in order to identify and
process the correction properly.
.11The record sequence for filing
corrections is the same as for original
returns.
.12Review the chart that follows.
Errors normally fall under one of the
two categories listed. Next to each type
of error made is a list of instructions
on how to file the corrected return.
Guidelines for Filing Corrected Returns Magnetically/Electronically
Error Made on the Original ReturnHow To File the Corrected Return
Two (2) separate transactions are required to make the
following corrections properly. Following directions for both
Transations 1 and 2 (See Note 1).
Transaction 1: Identify incorrect returns
1. Original return was filed with one or more of the
following errors:
A. Prepare a new Form 4804/4802 that includes information
related to this file.

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Guidelines for Filing Corrected Returns Magnetically/Electronically (Continued)
Error Made on the Original ReturnHow To File the Corrected Return
(a) No Payee TIN (SSN or EIN)
(b) Incorrect Payee TIN
(c) Incorrect Payee Name
(d) Wrong type of return indicator
B. Mark ‘‘Correction’’ in Block 1 of Form 4804.
C. Prepare a new file.
Make a separate ‘‘A’’ Record for each type of return
being reported. The information in the ‘‘A’’ Record will
be exactly the same as it was in the original submission.
D. The Payee ‘‘B’’ Record must contain exactly the same
information as submitted previously, except, insert a
‘‘G’’ in field position 7 of the ‘‘B’’ Record, and for all
payment amounts, enter ‘‘0’’ (zero).
E. Corrected returns submitted to IRS/MCC using a ‘‘G’’
coded ‘‘B’’ Record may be on the same tape or diskette
as those returns submitted without the ‘‘G’’ code;
however, separate ‘‘A’’ Records are required.
F. Prepare a ‘‘C’’ Record.
Transaction 2: Report the correct information
A. Prepare a new file with the correct information in all
records.
B. Make a separate ‘‘A’’ Record for each type of return and
each payer being reported.
C. The ‘‘B’’ Record must show the correct Information as
well as a ‘‘C’’ in field position 7.
D. Corrected returns submitted to IRS/MCC using a ‘‘C’’
coded ‘‘B’’ Record may be on the same tape or diskette
as those returns submitted without the ‘‘C’’ code;
however, separate ‘‘A’’ Records are required.
E. Prepare a ‘‘C’’ Record.
F. Indicate ‘‘Correction’’ on the external media label.
*Note 1:Payers who can show that they have reasonable cause (defined in the regulations under sections 6721-6724
of the Internal Revenue Code) are not required to make corrections for returns filed with a missing or
incorrect name and/or TIN. These payers should change their records in order to submit correct
information in the future. Payers who cannot show reasonable cause are encouraged to make corrections
for the current processing year by August 1 to reduce applicable penalties. Corrections filed by August 1
will reduce the $50 per return penalty for filing returns with missing or incorrect information to $15 or
$30. (For penalty information, refer to the Penalty section of the 1996 ‘‘Instructions for Forms 1099, 1098,
5498, and W–2G.’’) Corrections filed after August 1 will not reduce the penalty but will allow IRS to
update the payee’s records. The regulations for IRC sections 6721-6724 are available in Publication 1586,
Reasonable Cause Regulations and Requirements as They Apply to Missing and Incorrect TINs. The
publication may be obtained by calling 1-800-TAX-FORM (1-800-829-3676).
ONE TRANSACTION IS REQUIRED TO MAKE THE
FOLLOWING CORRECTIONS PROPERLY (See Note 2).
2. Original return was filed with one or more of the
following errors:
(a)Incorrect Payment Amount Codes in the ‘‘A’’
Record
(b)Incorrect Payment amounts in the ‘‘B’’ Record
(c)Incorrect Code in the Document Specific/
Distribution Code Field in the ‘‘B’’ Record
(d)Incorrect Payee Address
(e)Direct Sales Indicator
A. Prepare a new Form 4804/4802 that includes information
relating to this new file.
B. Mark ‘‘Correction’’ in Block 1 of Form 4804.
C. Prepare a new file. Make separate ‘‘A’’ Records for each
type of return being reported. Information in the ‘‘A’’
Record may be the same as it was in the original
submission.
D. The ‘‘B’’ Record must show the correct information as
well as a ‘‘G’’ in field position 7.
E. Corrected returns submitted to IRS/MCC using a ‘‘G’’
coded ‘‘B’’ Record may be on the same tape or diskette
as those returns submitted without the ‘‘G’’ code;
however, separate ‘‘A’’ Records are required.
F. Prepare a ‘‘C’’ Record.
G.Mark ‘‘Correction’’ on the external media label.

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Guidelines for Filing Corrected Returns Magnetically/Electronically (Continued)
Error Made on the Original ReturnHow To File the Corrected Return
*Note 2:If a filer is correcting the name and/or TIN in addition to any errors listed in item 2 of the chart, then
two transactions will be required. If a filer is reporting ‘‘G’’ coded, ‘‘C’’ coded, and/or ‘‘Non-coded’’
(original) returns on the same media, they must be reported under separate ‘‘A’’ Records.
Sec. 14. Taxpayer Identification Number (TIN)
.01Section 6109 of the Internal Revenue Code requires a person to furnish his/her TIN to the person obligated to file the
information return.
.02The payee’s TIN and name combination is used to associate information returns reported to IRS/MCC with
corresponding information on tax returns. It is imperative that correct Social Security and Employer Identification Numbers
for payees be provided to IRS/MCC. Do not enter hyphens or alpha characters. Entering all zeros, ones, twos, etc., will
have the effect of an incorrect TIN.
.03The payer and payee names with associated TINs should be consistent with the names and TINs used on other tax
returns. Also, the name and TIN provided must belong to the owner of the account. If the account is recorded in more than
one name, furnish the name and TIN of one of the owners of the account. The TIN provided must be associated with the
name of the payee provided in the first name line of the ‘‘B’’ Record. For individuals, the payee TIN is generally the
payee’s Social Security Number. For other entities, the payee TIN is the payee’s Employer Identification Number. For sole
proprietors, the payee TIN may be either an SSN or EIN but the sole proprietor’s name (not the business name) must be
used.
.04Failure to provide the correct name and corresponding TIN could result in a penalty and/or backup withholding notice
(sometimes referred to as a ‘‘B’’ notice). (For penalty information, refer to the Penalty Section of the 1996 ‘‘Instructions for
Forms 1099, 1098, 5498, and W–2G.’’ For ‘‘B’’ Notice information, refer to the Backup Withholding Section of the same
publication.)
.05The following charts will help payers determine the TIN to be furnished to IRS/MCC for those persons for whom
they are reporting information (payees).
Chart 1. Guidelines for Social Security Numbers
For this type of account-
In the Taxpayer Identification Number
field of the Payee ‘‘B’’ Record, enter
the SSN of-
In the First Payee Name Line of the
Payee ‘‘B’’ Record, enter the name of-
1. IndividualThe individualThe individual
2. Joint account (Two or more individ-
uals, including husband and wife)
The actual owner of the account or, if
combined funds, the first individual on
the account.
The individual whose SSN is entered
3. Custodian account of a minor
(Uniform Gift, or Transfers, to Minors
Act)
The minorThe minor
4. The usual revocable savings trust
account (grantor is also trustee)
The grantor-trusteeThe grantor-trustee
5. A so-called trust account that is not
a legal or valid trust under state law
The actual ownerThe actual owner
6. Sole proprietorshipThe owner (An SSN or EIN)The owner, not the business name (the
filer may enter the business name on
the second name line).
Chart 2. Guidelines for Employer Identification Numbers
For this type of account-
In the Taxpayer Identification Number
field of the Payee ‘‘B’’ Record, enter
the EIN of-
In the First Payee Name line of the
Payee ‘‘B’’ Record, enter the name of-
1. A valid trust, estate, or pension trustLegal entity
1
The legal trust, estate, or pension trust
2. CorporateThe corporationThe corporation
3. Association, club, religious, chari-
table, educational, or other tax-exempt
organization
The organizationThe organization

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Chart 2. Guidelines for Employer Identification Numbers (Continued)
For this type of account-
In the Taxpayer Identification Number
field of the Payee ‘‘B’’ Record, enter
the EIN of-
In the First Payee Name line of the
Payee ‘‘B’’ Record, enter the name of-
4. Partnership account held in the name
of the business
The partnershipThe partnership
5. A broker or registered nominee/
middleman
The broker or nominee/middlemanThe broker or nominee/middleman
6. Account with Department of Agri-
culture in the name of a public entity
(such as a state or local government,
school district, or prison), that receives
agriculture program payments
The public entityThe public entity
7. Sole proprietorshipThe business (An EIN or SSN)The owner, not the business name (the
filer may enter the business name on
the second name line).
1
Do not furnish the identification number of the personal representative or trustee unless the name of the representative or
trustee is used in the account title.
Sec. 15. Effect on Paper Returns
.01 Magnetic/electronic reporting of
information returns eliminates the need
to submit paper documents to the IRS.
CAUTION! Do not send Copy A of
the paper forms to IRS/MCC in
addition to magnetic media and
electronic filing. This will result in
duplicate filing; therefore, erroneous
notices could be generated.
.02 Payers are responsible for
providing statements to the payees as
outlined in the 1996 ‘‘Instructions for
Forms 1099, 1098, 5498, and W–2G.’’
Refer to these instructions for filing
information returns on paper with the
IRS and furnishing statements to
recipients.
.03 Statements to recipients should
be clear and legible. If the official IRS
form is not used, the filer must adhere
to the specifications and guidelines in
Publication 1179, ‘‘Rules and Specifi-
cations for Private Printing of Sub-
stitute Forms 1096, 1098, 1099 Series,
5498, and W–2G.’’
Sec. 16. Combined Federal/State
Filing Program
.01 The Combined Federal/State Fil-
ing Program was established to sim-
plify information returns filing for the
taxpayer. IRS/MCC will forward this
information to participating states free
of charge for approved filers. Separate
reporting to those states is not
necessary.
The following Information Returns
may not be filed under this program:
Form 1098—Mortgage Interest
Statement
Form 1099–A—Acquisition or
Abandonment of Secured Property
Form 1099–B—Proceeds for
B r o k e r a n d B a r t e r E x c h a n g e
Transactions
Form 1099–C—Cancellation of
Debt
Form 1099–S—Proceeds From
Real Estate Transactions
and
Form W–2G—Certain Gambling
Winnings
.02 To request approval to partici-
pate, a magnetic media or electronic
test file coded for this program must
be submitted to IRS/MCC between
November l and December 31. Hard
copy print tests are not acceptable
for Combined Federal/State Filing
approval.
.03 Attach a letter to the Form 4804
submitted with the test file to indicate a
desire to participate in this program.
.04 A test file is only required for
the first year. Each record, both in the
test and the actual data file, must
conform to this revenue procedure.
.05 If the test file is acceptable, IRS/
MCC will send the filer an approval
letter, and a Form 6847, Consent for
Internal Revenue Service to Release
Tax Information, which the payer must
complete, sign, and return to IRS/MCC
before any tax information can be
released to the state. Filers must write
their TCC on Form 6847. If the test
file is not acceptable, IRS/MCC will
return the media with a letter indicating
the problems. The replacement test file
m u s t b e r e t u r n e d t o I R S / M C C
postmarked on or before December 31.
.06 A separate Form 6847 is re-
quired for each payer. A transmitter
may not combine payers on one Form
6847 even if acting as Attorney-in-Fact
for several payers. Form 6847 may be
computer-generated as long as it in-
cludes all information that is on the
original form or it may be photocopied.
If the Form 6847 is signed by an
Attorney-in-Fact, the written consent
from the payer must clearly indicate
that the Attorney-in-Fact is empowered
to authorize release of the information.
.07 Only code the records for par-
ticipating states and for those payers
who have submitted Form 6847.
.08 Some participating states require
separate notification that the payer is
filing in this manner. Since IRS/MCC
acts as a forwarding agent only, it is
the payer’s responsibility to contact
the appropriate states for further
information.
.09 All corrections properly coded
for the Combined Federal/ State Filing
Program will be forwarded to the
participating states.
.10 Participating states and corre-
sponding valid state codes are listed in
Table 1 of this section. The appropriate
state code must be entered for those
documents that meet the state filing
requirements; do not use state abbre-
viations.
.11 To simplify filing, some of the
participating states have provided their
information return reporting require-
ments (see Table 2). Each state filing

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regulations are subject to change by
the state. It is the payer’s respon-
sibility to contact the participating
states to verify the criteria provided
in this table.
.12 Upon submission of the actual
files, the transmitter must be sure of
the following:
(a)All records should be coded
exactly as required by this reve-
nue procedure.
(b)The ‘‘C’’ Record must be fol-
lowed by a state total ‘‘K’’
Record for each state being
reported.
(c)Payment amount totals and the
valid participating state code
must be included in the State
Totals ‘‘K’’ Record.
(d)The last ‘‘K’’ Record must be
followed by an ‘‘A’’ Record or
an End of Transmission ‘‘F’’
Record (if this is the last record
of the entire file).
Table 1. Participating States And Their Codes
StateCodeStateCodeStateCode
Alabama01Iowa19North Carolina37
Arizona04Kansas20North Dakota38
Arkansas05Maine23Oregon41
California06Massachusetts25South Carolina45
Delaware10Minnesota27Tennessee47
District of Columbia11Mississippi28Wisconsin55
Georgia13Missouri29
Hawaii15Montana30
Idaho16New Jersey34
Indiana18New Mexico35
Table 2. Dollar Criteria For State Reporting
STATE1099–DIV1099–G1099–INT1099–MISC1099–OID1099–PATR1099–R5498
Alabama$1500$ NR$1500$1500$1500$1500$1500NR
Arkansas10025001002500250025002500
a
District of Columbia
b
600600600600600600600NR
Hawaii10
a
106001010600
a
Idaho1010106001010600
a
Iowa100100010001000100010001000NR
Minnesota1010106001010600
a
Mississippi600600600600600600600NR
MissouriNRNRNR1200
c
NRNRNRNR
Montana1010106001010600
a
New Jersey1000100010001000100010001000NR
North Carolina100100100600100100100
a
Tennessee25NR25NRNRNRNRNR
WisconsinNRNRNR600NRNR600NR
The preceding list is for information purposes only. The state filing requirements are subject to change by the states. For
complete information on state filing requirements, contact the appropriate state tax agencies.
Filing requirements for any state in TABLE 1 not shown in TABLE 2 are the same as the federal requirement.
NR = No filing requirement.
Footnotes:
a. All amounts are to be reported.
b. Amounts are for aggregates of several types of income from the same payer.
c.Missouri would prefer those returns filed with respect to non-Missouri residents to be sent directly to their state agency.

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Sec. 17. Definition of Terms
ElementDescription
Asynchronous ProtocolsThis type of data transmission is most often used by
m i c r o c o m p u t e r s , P C s a n d s o m e m i n i c o m p u t e r s .
Asynchronous transmissions transfer data at arbitrary time
intervals using the start-stop method. Each character
transmitted has its own start bit and stop bit.
b/Denotes a blank position. Enter blank(s) when this symbol is
used (do not enter the letter ‘‘b’’). This appears in numerous
areas throughout the record descriptions.
Bisynchronous ProtocolsFor purposes of this publication, these are electronic
transmissions made using IBM 3780 protocols. These
transmissions must be in EBCDIC character code and use
the Bell 208B (4800bps) or AT&T 2296A (9600bps)
modems. Standard IBM 3780 space compression is
acceptable.
CorrectionA correction is an information return submitted by the payer
to correct erroneous information previously submitted to
IRS/MCC.
*Note:A correction should not be confused with a REPLACEMENT. Only media returned to the filer by IRS/
MCC due to processing problems should be marked REPLACEMENT.
CUSIP NumberA number developed by the Committee on Uniform Security
Identification Procedures to serve as a common denominator
in communications among users for security transactions and
security information.
Employer Identification Number (EIN) Electronic FilingA nine-digit number assigned by IRS for federal tax
reporting purposes. Submission of information returns using
switched telecommunications network circuits. These trans-
missions use modems, dial-up phone lines, and asynchronous
or bisynchronous protocols. See Parts A, C, and D of this
publication for specific information on electronic filing.
FileFor purposes of this revenue procedure, a file consists of all
records submitted by a payer or transmitter, either magnet-
ically or electronically.
FilerPerson responsible for submitting information returns to IRS.
Filing YearThe year in which the information returns are being
submitted to IRS/MCC (if magnetically) or service center (if
paper).
Golden Parachute PaymentA payment made by a corporation to a certain officer,
shareholder, or highly compensated individual when a
change in the ownership or control of the corporation occurs
or when a change in the ownership of a substantial part of
the corporate assets occurs.
Incorrect Taxpayer Identification Number (Incorrect TIN)A TIN may be incorrect for several reasons:
(a)The payee gave a wrong number (e.g., the payee is listed
as the only owner of an account but provided someone
else’s TIN).
(b)A processing error (e.g., the number was typed
incorrectly).
(c)The payee’s status changed (e.g., a payee name change
was not conveyed to the IRS or SSA so that they could
enter the change in their records).
Information ReturnThe vehicle for submitting required information about
another person to IRS.
Information returns are filed by financial institutions and by
others who make certain types of payments as part of their
trade or business.

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ElementDescription
The information required to be reported on an information
return includes interest, dividends, pensions, nonemployed
compensation for personal services, stock transactions, sales
of real estate, mortgage interest, and other types of
information. For this revenue procedure, an information
return is Form 1098, 1099–A, 1099–B, 1099–C, 1099–DIV,
1099–G, 1099–INT, 1099–MISC, 1099–OID, 1099–PATR,
1099–R, 1099–S, 5498, or W–2G.
Magnetic MediaFor this revenue procedure, the term ‘‘magnetic media’’
refers to
1
⁄2-inch magnetic tape; IBM 3480/3490/3490E or
AS400 compatible tape cartridge; or 5
1
⁄4- and 3
1
⁄2-inch
diskette.
Media Tracking SlipForm 9267 accompanies media that IRS/MCC has returned
to the filer for correction due to format or fatal errors
encountered when trying to process media. THIS MUST BE
RETURNED WITH THE REPLACEMENT FILE.
Missing Taxpayer Identification Number (Missing TIN)The payee TIN on an information return is ‘‘missing’’ if:
(a)there is no entry in the TIN field,
(b)includes one or more alpha characters (a character or
symbol other than an Arabic number) as one of the nine
digits, OR
(c)payee TIN has less than nine digits
PS 58 CostsThe current cost of life insurance under a qualified plan
taxable under section 72(m) and Regulations section 1.72–
16(b). (See Part B, Sec. 7, Payee ‘‘B’’ Record, Document
Specific/Distribution Code, Category of Distribution, Code
9.)
PayeePerson or organization receiving payments from the payer,
or for whom an information return must be filed. The payee
includes a borrower (Form 1099–A), a debtor (1099–C), a
participant (Form 5498), and a gambling winner (Form W–
2G). For Form 1098, the payee is the individual paying the
interest. For Form 1099–S, the payee is the seller or other
transferor.
PayerIncludes the person making payments, a recipient of
mortgage interest payments, a broker, a person reporting a
real estate transaction, a barter exchange, a creditor, a
trustee, or an issuer of an IRA or SEP, or a lender who
acquires an interest in secured property or who has reason to
know that the property has been abandoned. The payer will
be held responsible for the completeness, accuracy, and
timely submission of magnetic media files.
ReplacementA replacement is an information return file that IRS/MCC
has returned to the transmitter due to errors encountered
during processing.
*Note:Filers should never submit media to IRS/MCC marked ‘‘REPLACEMENT’’ unless IRS/MCC returned media to
the filers. When sending ‘‘REPLACEMENT’’ media, be sure to include the Media Tracking Slip (Form 9267)
which will accompany media returned by IRS/MCC. Media that has been incorrectly marked as
REPLACEMENT may result in duplicate filing.
Service BureauPerson or organization with whom the payer has a contract
to prepare and/or submit information return files to IRS/
MCC. A parent company submitting data for a subsidiary is
not considered a service bureau.
Social Security Number (SSN)A nine-digit number assigned by SSA to an individual for
wage and tax reporting purposes.
Special CharacterAny character that is not a numeral, an alpha, or a blank.
SSASocial Security Administration.

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ElementDescription
Statement to RecipientFor purposes of this revenue procedure, the copy of Form
1099, 1098, 5498, or W–2G that is required to be sent by
the payer to the recipient to provide information to be
reported on the recipient’s tax return. When reporting Form
1098, the payer is the receiver of the mortgage interest and
the recipient is the person making the interest payment.
When reporting Form 1099–S, the payer is the entity
reporting the transaction and the recipient is the seller or
other transferor.
Taxpayer Identification Number (TIN)May be either an Employer Identification Number (EIN) or
Social Security Number (SSN).
Tax YearThe year in which payments were made by a payer to a
payee.
Transfer AgentThe transfer agent, or paying agent, is the entity who has
been contracted or authorized by the payer to perform the
services of paying and reporting backup withholding (Form
945). The payer may be required to submit to IRS/MCC a
Form 2678, Employer Appointment of Agent Under Section
3504 of the Internal Revenue Code, which notifies IRS/MCC
of the transfer agent relationship.
TransmitterPerson or organization submitting file(s) magnetically/
electronically. May be payer or agent of payer.
Transmitter Control Code (TCC)A five character alpha/numeric number assigned by IRS/
MCC to the transmitter prior to actual filing magnetically or
electronically. This number is inserted in the ‘‘A’’ Record of
the files and must be present before the file can be
processed. An application Form 4419 must be filed with
IRS/MCC to receive this number.
VendorService bureaus that will produce information return files on
the prescribed types of magnetic media or via electronic
filing for payers who meet the 250 threshold or may be
unable to prepare their own media. Companies who provide
software for payers who wish to produce their own media or
electronic files.
Sec. 18. State Abbreviations
.01 The following state abbreviations are to be used when developing the state code portion of address fields. This table
provides state abbreviations only, and does not represent those states participating in the Combined Federal/State Filing
Program.
StateCodeStateCodeStateCode
AlabamaALKentuckyKYOhioOH
AlaskaAKLouisianaLAOklahomaOK
American SamoaASMaineMEOregonOR
ArizonaAZMarshall IslandsMHPennsylvaniaPA
ArkansasARMarylandMDPuerto RicoPR
CaliforniaCAMassachusettsMARhode IslandRI
ColoradoCOMichiganMISouth CarolinaSC
ConnecticutCTMinnesotaMNSouth DakotaSD
DelawareDEMississippiMSTennesseeTN
District of ColumbiaDCMissouriMOTexasTX
Federated StatesMontanaMTUtahUT
of MicronesiaFMNebraskaNEVermontVT
FloridaFLNevadaNVVirginiaVA
GeorgiaGANew HampshireNHVirgin IslandVI
GuamGUNew JerseyNJWashingtonWA
HawaiiHINew MexicoNMWest VirginiaWV
IdahoIDNew YorkNYWisconsinWI

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StateCodeStateCodeStateCode
IllinoisILNorth CarolinaNCWyomingWY
IndianaINNorth DakotaND
IowaIANorthern
KansasKSMariana IslandsMP
.02Filers must adhere to the city, state, and ZIP code format for U.S. addresses in the ‘‘B’’ Record. This also includes
American Samoa, Federated States of Micronesia, Guam, Marshall Islands, Northern Mariana Islands, Puerto Rico, and the
Virgin Islands.
.03For foreign country addresses, filers may use a 40 position free format which should include city, province or state,
postal code, and name of country in this order. This is allowable only if a ‘‘1’’ (one) appears in the Foreign Country
Indicator Field of the ‘‘B’’ Record.
.04When reporting APO/FPO addresses use the following format:
EXAMPLE:
Payee NamePVT Willard J. Doe
Mailing AddressCompany F, PSC Box 100
167 Infantry REGT
Payee CityAPO (or FPO)
*Payee StateAE, AA, or AP
Payee ZIP Code098010100
* AE is the designation for ZIPs beginning with 090-098, AA for ZIP 340, and AP for ZIPs 962-966.
Sec. 19. Major Problems Encountered
IRS/MCC encourages filers to verify the format and content of each type of record to ensure the accuracy of the data.
This may eliminate the need for IRS/MCC to return files for replacement. This may be important for those payers who have
either had their files prepared by a service bureau (see Note) or who have purchased preprogrammed software packages. If a
filer purchased a software package for a previous tax year, it may no longer be valid for reporting current tax year
information returns. Following are some of the most frequently encountered problems with magnetic/electronic files
submitted to IRS/MCC.
Some of the problems listed in the Major Problems Encountered may result in media being returned for replacement.
*Note:If filers meet the filing requirements and engage a service bureau to prepare media on their behalf, the
filers should be careful not to report duplicate data which may generate penalty notices.
1.Discrepancy between IRS/MCC totals and totals in Payer ‘‘C’’ Records
The ‘‘C’’ Record is a summary record for a type of return for a given payer as reported in the ‘‘B’’ Records. IRS balances
the total number of payees and payment amounts and compares them with totals in the ‘‘C’’ Records. Filers should verify
the accuracy of the records because imbalances may necessitate return of files for replacement.
2.The Payment Amount Fields in the ‘‘B’’ Record do not correspond to the Amount Codes in the ‘‘A’’ Record
If codes 2, 4, and 7 appear in the Amount Codes Field of the ‘‘A’’ Record, then the ‘‘B’’ Record must show payment
amounts in only Fields 2, 4, and 7, right-justified and unused positions must be zero (0) filled.
EXAMPLE:‘‘A’’ RECORD247bbbbbb—(‘b’ denotes a blank)
(Pos. 23–31)
‘‘B’’ RECORD0000867599—(Payment Amount 2)
(Pos. 61–70)
0000709097—(Payment Amount 4)
(Pos. 81–90)
0000044985—(Payment Amount 7)
(Pos. 111–120)

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3.Blanks or invalid characters appear in Payment Amount Fields in the ‘‘B’’ Record
Money amounts must be right-justified and zero (0) filled. Do not use blanks.
4. Incorrect TIN in Payer ‘‘A’’ Record
The Payer’s TIN reported in positions 7–15 of the ‘‘A’’ Record must be correct in order for IRS/MCC to process the media.
The TIN provided in the ‘‘A’’ Record should correspond with the name provided in the first payer name line.
5. Bad Format
IRS/MCC receives data in prior year format. Be sure to use the current revenue procedure (Publication 1220) for
formatting data.
6.Incorrect tax year in the Payer ‘‘A’’ Record and the Payee ‘‘B’’ Record
The tax year in both the payee and payer record should reflect the year of the information that is being reported. Filers need
to check their files to ensure that this information is correct.
7. Incorrect reporting of Form W–2 information to IRS
Form W–2 information is submitted to SSA, and not to IRS/MCC. SSA has its own magnetic media reporting program and
specifications for wage information, and the media containing Forms W–2 is submitted to SSA. Any media received at IRS/
MCC that contains Form W–2 information will be returned to the filer. The local SSA office should be contacted for
information concerning filing Forms W–2 on magnetic media.
8. Excessive withholding credits
Generally, for most information returns, other than Forms 1099–MISC, 1099–R, and W–2G, Federal withholding amounts
should not exceed 31 percent of the income reported. Validate the total reported in the withholding field against the total
income reported.
9. Incorrect format for TINs in the Payee ‘‘B’’ Record
A check of ‘‘B’’ Records should be made to ensure the Taxpayer Identification Numbers (TINs) are formatted correctly.
There should be nine numerics, no alphas, hyphens, commas, or blanks. Incorrect formatting of TINs may result in a
penalty. (For penalty information, refer to the Penalty section of the 1996 ‘‘Instructions for Forms 1099, 1098, 5498, and
W–2G.’’)
IRS/MCC contacts filers who have submitted payee data with missing TINs in an attempt to prevent erroneous notices.
Payers/transmitters who submit data with missing TINs and have taken the required steps to obtain this information are
encouraged to attach a letter of explanation to the required Form 4804. This will prevent unnecessary contact from IRS/
MCC. This letter, however, will not prevent backup withholding notices (CP2100 and CP2100A Notices) or penalties for
missing or incorrect TINs. (For penalty information, refer to the Penalty section of the 1996 ‘‘Instructions for Forms 1099,
1098, 5498, and W–2G.’’)
10. Distribution Codes for Form 1099–R reported incorrectly
Distribution Codes for Form 1099–R are being reported incorrectly or not being reported. See valid distribution codes for
1099–R in the Payee ‘‘B’’ Record layout.
11. Incorrect Record Totals Listed on Form 4804
The Combined Total Payee Records listed on the Form 4804 (Box 9) are used in the verification process of information
returns. The figure in this box should be the total number of Payee ‘‘B’’ Records contained on the media submitted with the
Form 4804. The figures on the Form 4804 are compared against the total number of Payee ‘‘B’’ Records processed on the
media. Imbalances may necessitate the return of the files for replacement.
12. Invalid Use of IRA/SEP Indicator
The IRA/SEP Indicator for Form 1099–R should be used only for the reporting of a distribution from an IRA or SEP. The
total amount distributed from an IRA or SEP should be reported in Payment Amount Field 2 (IRA/SEP Distribution).

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Part B. Magnetic Media Specifications
Sec. 1. General
.01 The specifications contained in
this part of the revenue procedure
define the required format and contents
of the records to be included in the
magnetic media file.
.02 A provision is made in the ‘‘B’’
Records for Special Data Entries. These
entries are optional. If the field is not
utilized, enter blanks to maintain a
fixed record length of 420 positions.
The field is intended to serve one or
both of these purposes:
(a)Contain information required
by state or local governments. Filers
who wish to use this option for
satisfying state or local reporting re-
quirements should contact the state or
local department of revenue for filing
instructions. (Also refer to Part A, Sec.
16.)
(b)Contain information for the
filer’s own personal use and used at the
discretion of the filer to include infor-
mation related to each individual re-
turn. IRS/MCC will not use the infor-
mation supplied in this field. The
length of this field will vary depending
on the type of return.
.03Transmitters should be consistent
in the use of recording codes and
density on files. If the media does not
meet these specifications, it could be
returned to the transmitter for replace-
ment. Filers are encouraged to submit a
test prior to submitting the actual file.
Contact IRS/MCC for further informa-
tion at 304-263-8700.
.04Use ‘‘K’’ Records only if the
payer is an approved Combined
Federal/State filer.
Sec. 2. Tape Specifications
.01 IRS/MCC can process most
magnetic tape files if the following
specifications are followed:
(a)9 track EBCDIC (Extended
Binary Coded Decimal Inter-
change Code) with:
(1) Odd parity.
(2)A density of 1600 or 6250
CPI.
(3)If transmitters use UNISYS
Series 1100, they must sub-
mit an interchange tape.
(b)9 track ASCII (American
Standard Coded Information
Interchange) with:
(1) Odd parity.
(2)A density of 1600 or 6250
CPI.
Transmitters should be consistent in
the use of recording codes and density
on files.
.02 All compatible tape files must
have the following characteristics: Type
of tape—
1
⁄2-inch (12.7 mm) wide,
computer-grade magnetic tape on reels
of up to 2,400 feet (731.52 m) within
the following specifications:
(a)Tape thickness: 1.0 or 1.5 mils
and
( b )R e e l d i a m e t e r : 1 0
1
⁄2- i n c h
(26.67 cm), 8
1
⁄2-inch (21.59
cm), 7-inch (17.78 cm), or
6-inch.
.03 The tape records defined in this
revenue procedure may be blocked
subject to the following:
(a)A block must not exceed
32,760 tape positions.
(b)If the use of blocked records
would result in a short block,
all remaining positions of the
block must be filled with 9’s;
however, the last block of the
file may be filled with 9’s or
truncated. Do not pad a block
with blanks.
(c)All records, except the header
and trailer labels, may be
blocked or unblocked. A rec-
ord may not contain any con-
trol fields or block descriptor
fields which describe the
length of the block or the
logical records within the
block. The number of logical
records within a block (the
blocking factor) must be con-
stant in every block with the
exception of the last block
which may be shorter (see
item b above). The block
length must be evenly divisible
by 420.
(d)Records may not span blocks.
.04 Labeled or unlabeled tapes may
be submitted.
.05 For the purposes of this revenue
procedure the following must be used:
Tape Mark:
(a)Used to signify the physical
end of the recording on tape.
(b)For even parity, use BCD
configuration 001111 (8421).
(c)May follow the header label
and precede and/or follow the
trailer label.
.06IRS/MCC can only read one
data file on a tape. A data file is a
group of records which may or may not
begin with a tapemark, but must end
with a trailer label. Any data beyond
the trailer label cannot be read by IRS
programs.
Sec. 3. Tape Cartridge Specifications
.01 In most instances, IRS/MCC can
process tape cartridges that meet the
following specifications:
(a)Must be IBM 3480, 3490,
3490E, or AS400 compatible.
(b)Must meet American National
Standard Institute (ANSI)
standards, and have the fol-
lowing characteristics:
(1)Tape cartridges will be
1
⁄2-
inch tape contained in plas-
tic cartridges which are ap-
proximately 4-inches by
5 - i n c h e s b y 1 - i n c h i n
dimension.
(2)Magnetic tape will be chro-
mium dioxide particle based
1
⁄2-inch tape.
(3)Cartridges must be 18-track
or 36-track parallel (See
Note).
(4)Cartridges will contain
37,871 CPI or 75,742 CPI
(characters per inch).
(5)Mode will be full function.
(6)The data may be com-
pressed using EDRC (Mem-
o r e x ) o r I D R C ( I B M )
compression.
(7)Either EBCDIC (Extended
Binary Coded Decimal In-
terchange Code) or ASCII
(American Standard Coded
Information Interchange)
may be used.
.02 The tape cartridge records de-
fined in this revenue procedure may be
blocked subject to the following:
(a)A block must not exceed
32,760 tape positions.
(b)If the use of blocked records
would result in a short block,
all remaining positions of the
block must be filled with 9’s;
however, the last block of the
file may be filled with 9’s or
truncated. Do not pad a block
with blanks.
(c)All records, except the header
and trailer labels, may be
blocked or unblocked. A rec-

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ord may not contain any con-
trol fields or block descriptor
fields which describe the
length of the block or the
logical records within the
block. The number of logical
records within a block (the
blocking factor) must be con-
stant in every block with the
exception of the last block
which may be shorter (see
item b above). The block
length must be evenly divisible
by 420.
(d)Records may not span blocks.
.03 Tape cartridges may be labeled
or unlabeled.
.04 For the purposes of this revenue
procedure, the following must be used:
Tape Mark:
(a)Used to signify the physical
end of the recording on tape.
(b)For even parity, use BCD
configuration 001111 (8421).
(c)May follow the header label
and precede and/or follow the
trailer label.
*Note:Filers should indicate on
the external media label
and transmittal Form 4804
whether the cartridge is 36-
track or 18-track.
Sec. 4. 8mm (.315-inch) Tape
Cartridges
For Tax Year 1996, the processing
of 8mm tape cartridge (also referred to
as cassette) as an acceptable form of
magnetic media is offered as a pilot
program for transmitters with AS400
operations systems only.
.01In most instances, IRS/MCC can
process tape cartridges that meet the
following specifications:
(a)Must meet American National
Standard Institute (ANSI)
standards, and have the fol-
lowing characteristics:
(1)8mm (.315-inch) tape car-
tridges will be 2
1
⁄2-inch by
3
3
⁄4-inch.
(2)Magnetic tape will be chro-
mium dioxide particle based
8mm tape.
(3)Mode will be full function.
(4)Compressed data is not
acceptable.
(5)Either EBCDIC (Extended
Binary Coded Decimal In-
terchange Code) or ASCII
(American Standard Coded
Information Interchange)
may be used. However, IRS/
MCC encourages the use of
EBCDIC. This information
must appear on the external
media label affixed to the
cartridge.
(6)A file may consist of more
than one cartridge, how-
ever, no more than 250,000
documents may be transmit-
ted per file or per cartridge.
The filename, for example;
IRSTAX will contain a three
digit extension. The exten-
sion will indicate the se-
quence of the cartridge
within the file 1 of 3, 2 of 3,
and 3 of 3 and would
appear in the header label
IRSTAX.001, IRSTAX.002,
and IRSTAX.003 on each
cartridge of the file.
.02 The 8mm (.315-inch) tape car-
tridge records defined in this revenue
procedure may be blocked subject to
the following:
(a)A block must not exceed
32,760 tape positions.
(b)If the use of blocked records
would result in a short block,
all remaining positions of the
block must be filled with 9’s;
however, the last block of the
file may be filled with 9’s or
truncated. Do not pad a
block with blanks.
(c)All records, except the header
and trailer labels, may be
blocked or unblocked. A rec-
ord may not contain any con-
trol fields or block descriptor
fields which describe the
length of the block or the
logical records within the
block. The number of logical
records within a block (the
blocking factor) must be con-
stant in every block with the
exception of the last block
which may be shorter (see
item b above). The block
length must be evenly divisible
by 420.
(d)‘COPY’ or ’SAVE’ command
must be used to store data on
the cartridge.
(e)Extraneous data following the
‘‘F’’ record will result in
media being returned for re-
placement.
(f)Records may not span blocks.
(g)No more than 250,000 docu-
ments per cartridge and per
file.
.03 For faster processing, IRS/MCC
encourages transmitters to use header
labeled cartridges. IRSTAX may be
used as a suggested filename.
.04 For the purposes of this revenue
procedure, the following must be used:
Tape Mark:
(a)Used to signify the physical
end of the recording on tape.
(b)For even parity, use BCD
configuration 001111 (8421).
(c)May follow the header label
and precede and/or follow the
trailer label.
.05If extraneous data follows the
end of the file ‘‘F’’ Record, the file
must be returned for replacement.
Therefore, IRS/MCC encourages trans-
mitters to use blank tape cartridges
rather than cartridges previously used,
in the preparation of data when sub-
mitting information returns.
.06 IRS/MCC can only read one data
file on a tape. A data file is a group of
records which may or may not begin
with a tapemark, but must end with a
trailer label. Any data beyond the
trailer label cannot be read by IRS
programs.
Sec. 5. 5
1
⁄4-inch and 3
1
⁄2-inch
Diskette Specifications
.01To be compatible, a diskette file
must meet the following specifications:
(a)5
1
⁄4- or 3
1
⁄2-inches in diameter.
(b)Data must be recorded in
standard ASCII code. For 5
1
⁄4-
inch diskettes, data may be
recorded using EBCDIC if the
diskette is created on an IBM
System 36.
(c)Records must be a fixed length
of 420 bytes per record.
(d)Delimiter character commas
(,) must not be used.
(e)Positions 419 and 420 of each
record have been reserved for
use as carriage return/line feed
(cr/lf) characters if applicable.
(f)Filename of IRSTAX must be
used. Do not enter any other
data in this field. If a file will
consist of more than one dis-
kette, the filename IRSTAX
will contain a three-digit exten-
sion. This extension will indi-
cate the sequence of the dis-

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kettes within the file. For example, the first diskette will be named IRSTAX.001, the second diskette will be
IRSTAX.002, etc.
(g)A diskette file may consist of multiple diskettes as long as the file naming conventions are followed.
(h)Diskettes must meet one of the following specifications:
CapacityTracksSides/DensitySector Size
1.44 mb96tpihd512
1.44 mb135tpihd512
1.2 mb96tpihd512
720 kb48tpids/dd512
360 kb48tpids/dd512
320 kb48tpids/dd512
180 kb48tpiss/dd512
160 kb48tpiss/dd512
.02 IRS/MCC encourages transmit-
ters to use blank or currently formatted
diskettes when preparing files (See
Note). If extraneous data follows the
end of file ‘‘F’’ Record, the file must
be returned for replacement.
.03 IRS/MCC prefers that 5
1
⁄4- and
3
1
⁄2-inch diskettes be created using MS-
DOS; however, diskettes created using
other operating systems may be accept-
able.
*Note:3
1
⁄2-inch Diskettes Created
on a System 36 or AS400
Are Not Acceptable.
IRS/MCC has equipment that can
convert diskettes created under most
operating systems to the appropriate
MS-DOS format. IRS/MCC strongly
recommends that transmitters submit a
test file for 5
1
⁄4- and 3
1
⁄2-inch diskettes,
especially if their data was not created
using MS-DOS.
.04 Transmitters are encouraged to
use high density diskettes. Low density
diskettes are acceptable but must be
formatted in low density.
.05 Transmitters should check media
for viruses before submitting media to
IRS/MCC.
Sec. 6. Payer/Transmitter ‘‘A’’
Record—General Field Descriptions
.01 The Payer/Transmitter ‘‘A’’ Rec-
ord identifies the payer and transmitter
of the magnetic media file and provides
parameters for the succeeding Payee
‘‘B’’ Records. IRS computer programs
rely on the absolute relationship be-
tween the parameters and data fields in
the ‘‘A’’ Record and the data fields in
the ‘‘B’’ Records to which they apply.
.02 The number of ‘‘A’’ Records
depends on the number of payers and
the different types of returns being
reported. The payment amounts for one
payer and for one type of return should
be consolidated under one ‘‘A’’ Record
if submitted on the same file.
.03 Do not submit separate ‘‘A’’
Records for each payment amount
being reported. For example, if a payer
is filing Form 1099–DIV to report
Amount Codes 1, 2, and 3, all three
amount codes should be reported under
one ‘‘A’’ Record, not three separate
‘‘A’’ Records. For ‘‘B’’ Records that
do not contain payment amounts for all
three amount codes, enter zeros for
those which have no payment to be
reported.
.04 The first record on the file must
be an ‘‘A’’ Record. A transmitter may
include ‘‘B’’ Records for more than
one payer on a tape or diskette.
However, each group of ‘‘B’’ Records
must be preceded by an ‘‘A’’ Record
and followed by an End of Payer ‘‘C’’
Record. A single tape or diskette may
contain different types of returns but
the types of returns must not be
intermingled. A separate ‘‘A’’ Record
is required for each payer and each
type of return being reported.
.05 All records must be a fixed
length of 420 positions.
.06 An ‘‘A’’ Record may be blocked
with ‘‘B’’ Records, however, the initial
record on a file must be an ‘‘A’’
Record. IRS/MCC will accept an ‘‘A’’
Record after a ‘‘C’’ Record.
.07 Do not begin any record at the
end of a block or diskette and continue
the same record into the next block.
.08 All alpha characters entered in
the ‘‘A’’ Record must be upper-case.
.09 When filing Form 1098, Mort-
gage Interest Statement, the ‘‘A’’ Rec-
ord will reflect the name of the
recipient of the interest referred to as
the payer in these instructions. The
‘‘B’’ Record will reflect the individual
paying the interest (borrower/payer of
record) and the amount paid.
*Note:For all fields marked Re-
quired, a transmitter must
provide the information de-
scribed under Description
and Remarks. For fields not
marked Required, a trans-
mitter must allow for the
field, but may be instructed
to enter blanks or zeros in
the indicated media posi-
tion(s) and for the indicated
length. All records are now a
fixed length of 420 positions.
Record Name: Payer/Transmitter ‘‘A’’ Record
Field
PositionField TitleLengthDescription and Remarks
1Record Type1Required. Enter ‘‘A.’’
2–3Payment Year2Required. Enter ‘‘96’’ (unless reporting prior year data).

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
4–6Reel Sequence
Number
3The reel sequence number is incremented by 1 for each tape or diskette on the
file starting with 001. The transmitter may enter blanks or zeros in this field.
IRS/MCC bypasses this information. Indicate the proper sequence on the
external media label.
7–15Payer’s TIN9Required. Must be the valid nine-digit Taxpayer Identification Number assigned
to the payer. Do not enter blanks, hyphens, or alpha characters.
All zeros, ones, twos, etc., will have the effect of an incorrect TIN. For foreign
entities that are not required to have a TIN, this field may be blank. However,
the Foreign Entity Indicator, position 49 of the ‘‘A’’ Record, should be set to
‘‘1’’ (one).
16–19Payer Name
Control
4Not a required field. The Payer Name Control can be obtained only from the
mail label on the Package 1099 that is mailed to most payers each December.
To distinguish between Package 1099 and the Magnetic Media Reporting
(MMR) Package, the Package 1099 contains instructions for paper filing only,
and the mail label on the package contains a four (4) character name control.
The MMR Package contains instructions for filing magnetically or electronically.
The mail label does not contain a name control. Names of less than four (4)
characters should be left-justified, filling the unused positions with blanks. If a
Package 1099 has not been received or the Payer Name Control is unknown, this
field must be blank filled.
20Last Filing
Indicator
1Enter a ‘‘1’’ (one) if this is the last year the payer will file, otherwise, enter
blank. Use this indicator if the payer will not be filing information returns under
this payer name and TIN in the future either magnetically, electronically, or on
paper.
21Combined Federal/
State Filer
1Required for the Combined Federal/State Filing Program. Enter ‘‘1’’ (one) if
participating in the Combined Federal/State Filing Program, otherwise, enter
blank. Refer to Part A, Sec. 16, for further information. Forms 1098, 1099–A,
1099–B, 1099–C, 1099–S, and W–2G cannot be filed under this program.
22Type of Return1Required. Enter the appropriate code from the table below:
Type of ReturnCode
10983
1099–A4
1099–BB
1099–C5
1099–DIV1
1099–GF
1099–INT6
1099–MISCA
1099–OIDD
1099–PATR7
1099–R9
1099–SS
5498L
W–2GW
23–31Amount Codes
(See Note)
9Required. Enter the appropriate amount codes for the type of return being
reported. Generally, for each amount code entered in this field, a corresponding
payment amount must appear in the Payee ‘‘B’’ Record. In most cases, the box
numbers on paper information returns correspond with the amount codes
used to file magnetically/electronically. However, if discrepancies occur, this
revenue procedure governs.

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Example of Amount Codes:
If position 22 of the Payer/Transmitter ‘‘A’’ Record is ‘‘A’’ (for 1099–MISC) and positions 23–31 are
‘‘1247bbbbb’’, this indicates the payer is reporting any or all four payment amounts (1247) in all of the
following ‘‘B’’ Records. (In this example, ‘‘b’’ denotes blanks in the designated positions. Do not enter the
letter ‘b’.)
The first payment amount field will represent rents;
the second will represent royalties;
the third will be all ‘‘0’’ (zeros);
the fourth will represent federal income tax withheld;
the fifth and sixth will be all ‘‘0’’ (zeros);
the seventh will represent nonemployed compensation;
and
the eighth and ninth will be all ‘‘0’’ (zeros).
Enter the amount codes in ascending sequence (i.e., 1247bbbbb, left justify information, and fill unused
positions with blanks. For further clarification of the amount codes, contact IRS/MCC. (In this example, ‘‘b’’
denotes blanks in the designated positions. Do not enter the letter ‘b’.)
*Note:A type of return and an amount code must be present in every Payer ‘‘A’’ Record even if no money
amounts are being reported. For a detailed explanation of the information to be reported in each amount
code, refer to the 1996 ‘‘Instructions for Forms 1099, 1098, 5498, and W–2G.’’
Amount Codes Form 1098—
Mortgage Interest Statement
For Reporting Mortgage Interest Received From Payers/Borrowers (Payer of
Record) on Form 1098:
Amount
CodeAmount Type
1Mortgage interest received from payer(s)/borrower(s)
2Points paid on purchase of principal residence
3Refund of overpaid interest
Amount Codes Form 1099–A—
Acquisition or Abandonment of
Secured Property (See Note 1)
For Reporting the Acquisition or Abandonment of Secured Property on Form
1099–A:
Amount
CodeAmount Type
2Balance of principal outstanding
4Fair market value of property
*Note 1:If, in the same calendar year, a debt is canceled in connection with the acquisition or abandonment of
secured property and the filer would be required to file both Forms 1099–A and 1099–C (Cancellation of
Debt) for one debtor, the filer is required to file Form 1099–C only. See the 1996 ‘‘Instructions for Forms
1099, 1098, 5498, and W–2G’’ for further information on coordination with Form 1099–C.
Amount Codes Form 1099–B
Proceeds From Broker and
Barter Exchange Transaction
For Reporting Payments on Form 1099–B:
Amount
CodeAmount Type
2Stocks, bonds, etc. (For forward contracts, See Note 1)
3Bartering (Do not report negative amounts.)
4Federal income tax withheld (backup withholding) (Do not report
negative amounts.)
6Profit or (loss) realized on Closed Regulated Futures or Foreign
Currency Contracts in 1996 (See Note 2).
7Unrealized profit or (loss) on open contracts—12/31/95 (See Note 2).
8Unrealized profit or (loss) on open contracts—12/31/96 (See Note 2).
9Aggregate profit or (loss) (See Note 2).
*Note 1:The payment amount field associated with Amount Code 2 may be used to represent a loss from a closing
transaction on a forward contract. Refer to the ‘‘B’’ Record — General Field Descriptions, Payment
Amount Fields, for instructions on reporting negative amounts.

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
*Note 2:Payment Amount Fields 6, 7, 8, and 9 are to be used for the reporting of regulated futures or foreign
currency contracts.
Amount Codes
Form 1099–C—Cancellation
of Debt (See Note 1)
For Reporting Cancellation of Debt on Form 1099–C:
Amount
CodeAmount Type
2Amount of debt canceled (See Note 2)
3Interest included in Amount Code 2
4Penalties, fines, or administrative costs included in Amount Code 2
7Fair market value of property (See Note 3)
*Note 1:If, in the same calendar year, a debt is canceled in connection with the acquisition or abandonment of
secured property for one debtor and the filer would be required to file both Forms 1099–C and 1099–A
(Acquisition or Abandonment of Secured Property) the filer is required to file Form 1099–C only. See the
1996 ‘‘Instructions for Forms 1099, 1098, 5498, and W–2G’’ for further information on coordination with
Form 1099–A.
*Note 2:A debt is any amount owed to the debtor including principal, interest, penalties, administrative costs, and
fines, to the extent they are indebtedness under section 61(a)(12). The amount of debt discharged or
canceled may be all or only part of the total amount owed. See the 1996 ‘‘Instructions for Forms 1099,
1098, 5498, and W–2G’’ for further information.
*Note 3:Amount Code 7 will be used only if a combined Form 1099–A and 1099–C is being filed. See the 1996
‘‘Instructions for Forms 1099, 1098, 5498, and W–2G’’ for further information on reporting the fair
market value of property and coordination with Form 1099–A.
Amount Codes
Form 1099–DIV—Dividends
and Distributions
For Reporting Payments on Form 1099–DIV:
Amount
CodeAmount Type
1Gross dividends and other distributions on stock (See Note)
2Ordinary dividends (See Note)
3Capital gain distributions (See Note)
4Nontaxable distributions (if determinable) (See Note)
5Investment expenses (See Note)
6Federal income tax withheld (backup withholding)
7Foreign tax paid
8Cash liquidation distributions
9Noncash liquidation distributions (show fair market value)
*Note:Amount Code 1 MUST be present (unless the payer is using Amount Codes 8 or 9 only) and must equal the
sum of amounts reported for Amount Codes 2, 3, 4, and 5. If an amount is present for Amount Code 1,
there must be an amount present for Amount Codes 2-5 as applicable.
Amount Codes
Form 1099–G—Certain
Government Payments
For Reporting Payments on Form 1099–G:
Amount
CodeAmount Type
1Unemployment compensation
2State or local income tax refunds, credits, or offsets
4Federal income tax withheld (backup withholding)
6Taxable grants
7Agriculture payments
Amount Codes
Form 1099–INT—Interest
Income
For Reporting Payments on Form 1099–INT:

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Amount
CodeAmount Type
1Interest income not included in Amount Code 3
2Early withdrawal penalty
3Interest on U.S. Savings Bonds and Treasury obligations
4Federal income tax withheld (backup withholding)
5Foreign tax paid
Amount Codes
Form 1099–MISC—
Miscellaneous Income
For Reporting Payments on Form 1099–MISC:
Amount
CodeAmount Type
1Rents (See Note 1)
2Royalties (See Note 2)
3Other income
4Federal income tax withheld (backup withholding and withholding on
payments of Indian gaming profits)
5Fishing boat proceeds
6Medical and health care payments
7Nonemployed compensation or crop insurance proceeds (See Note 3)
8Substitute payments in lieu of dividends or interest
9Excess golden parachute payments
(Filers: See Note 4)
*Note 1:If reporting the Direct Sales Indicator only, use Type of Return Code A for 1099–MISC in position 22,
and Amount Code 1 in position 23 of the Payer ‘‘A’’ Record. All payment amount fields in the Payee
‘‘B’’ Record will contain zeros.
*Note 2:Do not report timber royalties under a ‘‘pay-as-cut’’ contract; these must be reported on Form 1099–S.
*Note 3:Amount Code 7 is normally used to report nonemployed compensation. However, Amount Code 7 may
also be used to report crop insurance proceeds. See positions 4-5 of the ‘‘B’’ Record for instructions. If
nonemployed compensation and crop insurance proceeds are being paid to the same payee, a separate
‘‘B’’ Record for each transaction is required.
*Note 4:For the convenience of the payer, the Special Data Entries Field in the Payee ‘‘B’’ Record may be used to
report state and local income tax withheld. This information does not need to be reported to IRS.
Amount Codes
Form 1099–OID—Original
Issue Discount
For Reporting Payments on Form 1099–OID:
Amount
CodeAmount Type
1Original issue discount for 1996
2Other periodic interest
3Early withdrawal penalty
4Federal income tax withheld (backup withholding)
Amount Codes
Form 1099–PATR—Taxable
Distributions Received From
Cooperatives
For Reporting Payments on Form 1099–PATR:
Amount
CodeAmount Type
1Patronage dividends
2Nonpatronage distributions
3Per-unit retain allocations
4Federal income tax withheld (backup withholding)
5Redemption of nonqualified notices and retain allocations
Pass-Through Credits (See Note)
6For filers’ use

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Amount
CodeAmount Type
7Energy investment credit
8Jobs credit
9Patron’s Alternative Minimum Tax (AMT) Adjustment
*Note:Amount Codes 6, 7, and 8 are reserved for the patron’s share of unused credits that the cooperative is
passing through to the patron. Other credits, such as the Indian employment credit may be reported in
Amount Code 6. The title of the credit reported in Amount Code 6 should be reported in the Special Data
Entries Field in the Payee ‘‘B’’ Record. The amounts shown for Amount Codes 6, 7, 8, and 9 must be
reported to the payee. These Amount Codes and the Special Data Entries Field are for the convenience of
the filer. This information is not needed by IRS/MCC.
Amount Codes Form 1099–R—
Distributions From Pensions,
Annuities, Retirement or Profit-
Sharing Plans, IRAs, Insurance
Contracts, etc. (See Note 1)
For Reporting Payments on Form 1099–R:
Amount
CodeAmount Type
1Gross distribution (See Note 2)
2Taxable amount (See Note 3)
3Capital gain (included in Amount Code 2)
4Federal income tax withheld (See Note 4)
5Employee contributions or insurance premiums
6Net unrealized appreciation in employers’ securities
8Other
9Total employee contributions
*Note 1:Additional information may be required in the ‘‘B’’ Record. Refer to positions 44 through 48 of the ‘‘B’’
Record.
*Note 2:If the payment shown for Amount Code 1 is a total distribution, enter a ‘‘1’’ (one) in position 47 of the
‘‘B’’ Record. An amount must be shown in Amount Field 1.
*Note 3:If a distribution is a loss, do not enter a negative amount. For example, if stock is distributed but the
value is less than the employee’s after-tax contributions, enter the value of the stock in Amount Code 1,
enter ‘‘0’’ (zero) in Amount Code 2, and enter the employee’s contributions in Amount Code 5.
If the taxable amount cannot be determined, enter a ‘‘1’’ (one) in position 48 of the ‘‘B’’ Record. If
reporting an IRA/SEP distribution, generally include the amount of the distribution in the Taxable
Amount (Payment Amount Field 2, positions 61-70) and enter a ‘‘1’’ (one) in the IRA/SEP Indicator Field
(position 44). A ‘‘1’’ (one) may be entered in the Taxable Amount Not Determined Indicator Field
(position 48) of the Payee ‘‘B’’ Record, but the amount of the distribution must still be reported in
Payment Amount Fields 1 and 2. See the explanation for Box 2a of Form 1099–R in the 1996
‘‘Instructions for Forms 1099, 1098, 5498, and W–2G’’ for more information on reporting the taxable
amount.
*Note 4:See the 1996 ‘‘Instructions for Forms 1099, 1098, 5498, and W–2G’’ for information concerning federal
income tax withheld for Form 1099–R.
*Note:For payers who wish to report state or local income tax, see Part B, Section 7 (6) Payee ‘‘B’’ Record—
Record Layout Positions 322-420 Form 1099–R.
Amount Codes Form 1099–
S—Proceeds From Real
Estate Transactions
For Reporting Payments on Form 1099–S:
Amount
CodeAmount Type
2Gross proceeds (See Note)
5Buyer’s part of real estate tax
*Note:Include payments of timber royalties made under a ‘‘pay-as-cut’’ contract, reportable under section 6050N.
If timber royalties are being reported, enter ‘‘TIMBER’’ in the description field of the ‘‘B’’ Record. For
more information, see Announcement 90–129, 1990–48 I.R.B. 10.

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Amount Codes Form 5498—
Individual Retirement
Arrangement Information (See
Note)
For Reporting Payments on Form 5498:
Amount
CodeAmount Type
1Regular IRA contributions made in 1996 and 1997 for 1996.
2Rollover IRA contributions
3Life insurance cost included in Amount Code 1
4Fair market value of the account
*Note:For information regarding Inherited IRAs, refer to the 1996 ‘‘Instructions for Forms 1099, 1098, 5498, and
W–2G’’ and Rev. Proc. 89–52, 1989–2 C.B. 632. Beneficiary information must be given in the Payee Name
Line Field of the ‘‘B’’ Record.
If reporting IRA contributions for a Desert Storm/Shield participant for other than 1996 or an Operations
Joint Endeavor (Bosnia Region) participant, enter ‘‘DS,’’ for Desert Storm or ‘‘JE’’ for Joint Endeavor, the
year for which the contribution was made, and the amount of the contribution in the Special Data Entries
Field of the ‘‘B’’ Record. Do not enter the contributions in Amount Code 1.
For information concerning Desert Storm/Shield participant reporting, refer to the 1994 ‘‘Instructions for
Forms 1099, 1098, 5498, and W–2G,’’ or Notice 91–17, 1991–1 C.B. 319. The instructions for filing Form
5498 for Desert Storm/Shield participants will also apply to participants of Operation Joint Endeavor of the
Bosnia Region.
Amount Codes Form W–2G—
Certain Gambling Winnings
For Reporting Payments on Form W–2G:
Amount
CodeAmount Type
1Gross winnings
2Federal income tax withheld
3State income tax withheld (See Note)
7Winnings from identical wagers
*Note:State income tax withheld is added for the convenience of the payer but need not be reported to IRS/MCC.
32Test Indicator1Required. Enter ‘‘T’’ if this is a test file, otherwise enter a blank.
33Service Bureau
Indicator
1Enter ‘‘1’’ (one) if a service was used to develop and/or transmit files,
otherwise, enter blank. See Part A, Sec. 17 for the definition of service bureau.
34–41Blank8Enter blanks.
42–43Magnetic Tape
Filer Indicator
2Required for magnetic tape/tape cartridge filers only. Enter the letters ‘‘LS’’ (in
uppercase only). Use of this field by filers using other types of media will be
acceptable but is not required.
44–48Transmitter
Control Code
(TCC)
5Required. Enter the five character alpha/numeric Transmitter Control Code
assigned by IRS/MCC. A TCC must be obtained to file data on this program.
Do not enter more than one TCC per file.
49Foreign Entity
Indicator
1Enter a ‘‘1’’ (one) if the payer s a foreign entity and income is paid by the
corporation to a U.S. resident. If the payer is not a foreign entity, enter a blank
(See Note).
*Note:If payers erroneously report entities as foreign, they may be subject to a penalty for providing incorrect
information to IRS. Therefore, payers must be sure to code only those records as foreign entities that
should be coded.
50–89First Payer Name
Line
40Required. Enter the name of the payer whose TIN appears in positions 7–15 of
the ‘‘A’’ Record. Any extraneous information must be deleted. Left justify
information, and fill unused positions with blanks. (Filers should not enter a
transfer agent’s name in this field. Any transfer agent’s name should appear in
the Second Payer Name Line Field.)

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Record Name: Payer/Transmitter ‘‘A’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
*Note:When reporting Form 1098, Mortgage Interest Statement, the ‘‘A’’ Record will reflect the name and TIN
of the recipient of the interest/the filer of Form 1098 (the payer). The ‘‘B’’ Record will reflect the
individual paying the interest (the payer of record) and the amount paid. For Form 1099–S, the ‘‘A’’
Record will reflect the person responsible for reporting the transaction (the filer of Form 1099–S) and the
‘‘B’’ Record will reflect the seller/transferor.
90–129Second Payer
Name Line
40If the Transfer (or Paying) Agent Indicator (position 130) contains a ‘‘1’’ (one),
this field must contain the name of the transfer (or paying) agent. If the
indicator contains a ‘‘0’’ (zero), this field may contain either a continuation of
the First Payer Name Line or blanks. Left justify information and fill unused
positions with blanks.
130Transfer Agent
Indicator
1Required. Identifies the entity in the Second Payer Name Line Field. (See Part
A, Sec. 17 for a definition of transfer agent.)
CodeMeaning
1The entity in the Second Payer Name Line Field is the transfer (or
paying) agent.
0(zero)The entity shown is not the transfer (or paying) agent (i.e., the
Second Payer Name Line Field contains either a continuation of the
First Payer Name Line Field or blanks).
131–170Payer Shipping
Address
40Required. If the Transfer Agent Indicator in position 130 is a ‘‘1’’ (one), enter
the shipping address of the transfer (or paying) agent. Otherwise, enter the
actual shipping address of the payer. The street address should include number,
street, apartment or suite number (or P. O. Box if mail is not delivered to street
address). Left justify information, and fill unused positions with blanks.
171–210Payer City, State,
and ZIP Code
40Required. If the Transfer Agent Indicator in position 130 is a ‘‘1’’ (one), enter
the city, town, or post office, state abbreviation and ZIP Code of the transfer
agent. Otherwise, enter the city, town, or post office, state, and ZIP Code of the
payer. Left justify information, and fill unused positions with blanks.
211–290Transmitter Name80Required if the payer and the transmitter are not the same. Enter the name of
the transmitter in the manner in which it is used in normal business. The name
of transmitter must be reported in the same manner throughout the entire file.
Left justify information, and fill unused positions with blanks. If the payer and
transmitter are the same, this field may be blank.
291–330Transmitter
Mailing Address
40Required if the payer and transmitter are not the same. Enter the mailing
address of the transmitter. Street address should include number, street,
apartment or suite number (or P.O. Box if mail is not delivered to street
address). Left justify information, and fill unused positions with blanks. If the
payer and transmitter are the same, this field may be blank.
331–370Transmitter City,
State, and ZIP
Code
40Required if the payer and transmitter are not the same. Enter the city, town, or
post office, state, and ZIP Code of the transmitter. Left justify information and
fill unused positions with blanks. If the payer and transmitter are the same, this
field may be blank.
371–418Blank48Enter blanks.
419–420Blank2Enter blanks or Carriage Return/Line Feed (CR/LF).

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Sec. 7. Payer/Trasmitter ‘‘A’’ Record—Record Layout
Record
Type
Payment
Year
Reel
Sequence
Number
Payer’s
TIN*
Payer
Name
Control*
Last
Filing
Indicator
12–34–67–1516–1920
Combined
Federal/State
Filer
Type
of
Return
Amount
Codes
Test
Indicator
Service
Bureau
Indicator
212223–313233
Blank
Magnetic
Tape
Filer
Indicator
Transmitter
Control
Code
Foreign
Entity
Indicator
First
Payer
Name
Line*
Second
Payer
Name
Line*
34–4142–4344–484950–8990–129
Transfer
Agent
Indicator
Payer
Shipping
Address*
Payer City
State And
Zip Code*
Transmitter
Name
Transmitter
Mailing
Address
130131–170171–210211–290291–330
Transmitter
City, State,
and Zip Code
Blank
Blank
or
CR/LF
331–370371–418419–420
*Note:When reporting Form 1098, Mortgage Interest Statement, the ‘‘A’’ Record will reflect the name and TIN of
the recipient of the interest (the payer). For Form 1099–S, the ‘‘A’’ Record will reflect the person
responsible for reporting the transaction.
Sec. 8. Payee ‘‘B’’ Record—General Field Descriptions and Record Layouts
.01 The ‘‘B’’ Record contains the payment information from the information returns. When filing information returns, the
format for the ‘‘B’’ Records will remain constant and is a fixed length of 420 positions. The record layout for positions 1
through 321 is the same for all ‘‘B’’ Records. Positions 322 through 420 vary for Forms 1099–A, 1099–B, 1099–C, 1099–
OID, 1099–S, and W–2G to accommodate variations within these forms. In the ‘‘A’’ Record, the amount codes that appear
in tape or diskette positions 23 through 31 will be left-justified and filled with blanks. In the ‘‘B’’ Record, the filer must
allow for all nine Payment Amount Fields. For those fields not used, enter ‘‘0’s’’ (zeros). For example, a payer reporting on
Form 1099–MISC, should ENTER ‘‘A’’ in tape position 22 of the ‘‘A’’ Record, Type of Return. If reporting payments for
Amount Codes 1, 2, 4, and 7, the payer would report media positions 23 through 31 of the ‘‘A’’ Record as ‘‘1247bbbbb.’’
(In this example, ‘‘b’’ denotes blanks. Do not enter the letter ’b’.) In the ‘‘B’’ Record:

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Positions 51 through 60 for Pay-
ment Amount 1 will represent
Rents.
Positions 61–70 for Payment
A m o u n t 2 w i l l r e p r e s e n t
Royalties.
Positions 71–80 for Payment
Amount 3 will be ‘‘0’s’’
(zeros).
Positions 81–90 for Payment
Amount 4 will represent Federal
income tax withheld.
Positions 91–110 for Payment
Amounts 5 and 6 will be ‘‘0’s’’
(zeros).
Positions 111–120 for Payment
Amount 7 will represent Non-
employee compensation.
Positions 121–140 for Payment
Amounts 8 and 9 will be ‘‘0’s’’
(zeros).
.02 The following specifications in-
clude a field in the payee records
called ‘‘Name Control’’ in which the
first four characters of the payee’s
surname are to be entered by the filer.
.03 If filers are unable to determine
the first four characters of the surname,
the Name Control Field may be left
blank. Compliance with the following
will facilitate IRS computer programs
in generating the name control:
(a)The surname of the payee
whose TIN is shown in the
‘‘B’’ Record should always
appear first. If, however, the
records have been developed
using the first name first, the
filer must leave a blank space
between the first and last
names.
(b)In the case of multiple payees,
only the surname of the payee
whose TIN (SSN or EIN) is
shown in the ‘‘B’’ Record
must be present in the First
Payee Name Line. Surnames
of any other payees may be
entered in the Second Payee
Name Line.
.04 See Part A, Sec. 14 for further
information concerning Taxpayer Iden-
tification Numbers (TINs).
.05 A field is also provided in these
specifications for Special Data Entries.
This field may be used to record
information required by state or local
governments, or for the personal use of
the filer. IRS does not use the data
provided in the Special Data Entries
Field, therefore, the IRS program does
not check the content or format of the
data entered in this field. It is the
filer’s option to use the Special Data
Entry Field. If this field is coded, it
will not affect the processing of the
‘‘B’’ Records.
.06 Those payers participating in the
Combined Federal/State Filing Program
must adhere to all of the specifications
in Part A, Sec. 16, in order to
participate in this program. Forms
1098, 1099–A, 1099–B, 1099–C, 1099–
S, and W–2G cannot be filed under the
C o m b i n e d F e d e r a l / S t a t e F i l i n g
Program.
.07 All alpha characters entered in
the ‘‘B’’ Record must be uppercase.
.08 Do not use decimal points (.) to
indicate dollars and cents. Ten dollars
must appear as 0000001000 in the
payment amount field.
.09 IRS strongly encourages trans-
mitters to review the data for accuracy
before submission to prevent issuance
of erroneous notices. Transmitters
should be especially careful that the
names, TINs, account numbers, types
of income, and income amounts are
correct.
.10 When reporting Form 1098,
Mortgage Interest Statement, the ‘‘A’’
Record will reflect the name and TIN
of the recipient of the interest, the filer
of the Form 1098 (the payer). The
‘‘B’’ Record will reflect the individual
paying the interest (borrower/payer of
record) and the amount paid. For Form
1099–S, the ‘‘A’’ Record will reflect
the person responsible for reporting the
transaction (the filer of the Form 1099–
S) and the ‘‘B’’ Record will reflect the
seller/transferor.
*Note:For all fields marked Re-
quired, the transmitter
must provide the informa-
tion described under De-
scription and Remarks. For
those fields not marked
Required, the transmitter
must allow for the field,
but may be instructed to
enter blanks or zeros in the
indicated position(s) and
for the indicated length. All
records are a fixed length
of 420 positions.
Record Name: Payee ‘‘B’’ Record
Field
PositionField TitleLengthDescription and Remarks
1Record Type1Required. Enter ‘‘B.’’
2–3Payment Year2Required. Enter ‘‘96’’ (unless reporting prior year data).
4–5Document
Specific/
Distribution Code
2Required for Forms 1099–G, 1099–MISC, 1099–R and W–2G. For all other
forms, or if not used, enter blanks.

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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Tax Year of Refund (Form
1099–G only)
For Form 1099–G, use only for reporting the tax year for which the *refund,
credit, or offset (Amount Code 2) was issued. Enter in position 4; position 5
must be blank. If the refund, credit, or offset is not attributable to income from a
trade or business, enter the numeric year from the table below for which the
refund, credit, or offset was issued (e.g., for 1995, enter 5). If the refund, credit
or offset is exclusively attributable to income from a trade or business and is not
of general application, enter the alpha equivalent of the year from the table
below (e.g., for 1995, enter E).
Code For Tax Year
Which Refund Was Issued
Tax Year
For Which
Refund Was
Issued
*Code
For
General
Refund
*Code For
Trade/Business
Refund (Alpha
Equivalent)
19911A
19922B
19933C
19944D
19955E
19866F
19877G
19888H
19899I
19900J
*Be sure the distribution code reflects the tax year for which the REFUND was made, not the tax year of the Form
1099–G.
Crop Insurance Proceeds
(Form 1099–MISC only)
For Form 1099–MISC, Enter ‘‘1’’ (one) in position 4 if the payments reported
for Amount Code 7 are crop insurance proceeds. Position 5 will be blank.
Distribution Code (Form
1099–R only) (For a
detailed explanation of the
Distribution Codes, see the
1996 ‘‘Instructions for
Forms 1099, 1098, 5498,
and W–2G.’’)
For Form 1099–R, enter the appropriate distribution code(s). More than one
code may apply for Form 1099–R. If only one code is required, it must be
entered in position 4 and position 5 must be blank. Enter at least one (1) dis-
tribution code. A blank in position 4 is not acceptable.
Enter the applicable code from the table that follows. Position 4 must contain a
numeric code in all cases except when using P, D, E, F, G, or H. Distribution
Code A, B, or C, when applicable, must be entered in position 5 with the
applicable numeric code in position 4.
When using Code P for an IRA distribution under section 408(d)(4) of the
Internal Revenue Code, the filer may also enter Code 1 if applicable.
Only three numeric combinations are acceptable, Codes 8 and 1, Codes 8 and 2
and Codes 8 and 4, on one return. These three combinations can be used only if
both codes apply to the distribution being reported. If more than one numeric
code is applicable to different parts of a distribution, report two separate ‘‘B’’
Records.

SEQ 0046 JOB IRS27-012-005 PAGE-0044 PT 3 PGS 44-
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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Form 1099–R
Continued
Distribution Codes E, F, and H cannot be used in conjunction with other codes.
Distribution Code G may be used in conjunction with Distribution Code 4 only,
if applicable.
CategoryCode
Early (premature) distribution, no known exception1*
Early (premature) distribution, exception applies (as defined in sec-
tion 72(q), (t), or (v) of the Internal Revenue Code) (other than
disability or death)
2*
Disability3*
Death (includes payments to an estate or other beneficiary)4*
Prohibited transaction5*
Section 1035 exchange6
Normal distribution7*
Excess contributions plus earnings/excess deferrals (and/or earnings)
taxable in 1996
8*
PS 58 costs9
Excess contributions plus earnings/excess deferrals taxable in 1995P*
May be eligible for 5- or 10-year tax optionA
May be eligible for death benefit exclusionB
May be eligible for both A and BC
Excess contributions plus earnings/excess deferrals taxable in 1994D*
Excess annual additions under section 415E
Charitable gift annuityF
Direct rollover to IRAG
Direct rollover to qualified plan or tax-sheltered annuityH
* If reporting an IRA or SEP distribution, code a ‘‘1’’ (one) in position 44 of the ‘‘B’’ Record.
Type of Wager (Form
W–2G only)
For Form W–2G, enter the applicable code in position 4. Position 5 will be
blank.
CategoryCode
Horse race track (or off-track betting of a horse track nature)1
Dog race track (or off-track betting of a dog track nature)2
Jai-alai3
State-conducted lottery4
Keno5
Bingo6
Slot machines7
Any other type of gambling winnings8

SEQ 0047 JOB IRS27-012-005 PAGE-0045 PT 3 PGS 44-
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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
62nd TIN Notice1For Forms 1099–B, 1099–DIV, 1099–INT, 1099–MISC, 1099–OID, and 1099–
PATR only.
Enter ‘‘2’’ to indicate notification by IRS/MCC twice within three calendar
years that the payee provided an incorrect name and/or TIN combination,
otherwise, enter a blank.
7Corrected Return
Indicator
1Indicate a corrected return.
CodeDefinition
GIf this is a one-transaction correction or the first of a two-transaction
correction
CIf this is the second transaction of a two transaction correction
BlankIf this is not a return being submitted to correct information already
processed by IRS.
*Note:C, G, and non-coded records must be reported using separate Payer ‘‘A’’ Records. Refer to Part A, Sec. 13,
for specific instructions on how to file corrected returns.
8–11Name Control4If determinable, enter the first four (4) characters of the surname of the person
whose TIN is being reported in positions 15–23 of the ‘‘B’’ Record, otherwise,
enter blanks. This is usually the payee. If the name that corresponds to the
TIN is not included in the first or second payee name line and the correct
name control is not provided, a backup withholding notice may be
generated for the record. Surnames of less than four (4) characters should be
left-justified, filling the unused positions with blanks. Special characters and
imbedded blanks should be removed. In the case of a business, other than a sole
proprietorship, use the first four significant characters of the business name.
Disregard the word ‘‘the’’ when it is the first word of the name, unless there are
only two words in the name. A dash (-) and an ampersand (&) are the only
acceptable special characters. Surname prefixes are considered part of the
surname, e.g., for Van Elm, the name control would be VANE.
*Note:Although extraneous words, titles, and special characters are allowed (i.e., Mr., Mrs., Dr., apostrophe, or
dash), this information may be dropped during subsequent IRS/MCC processing.
The following examples may be helpful to filers in developing the Name Control:
NameName Control
Individuals:
Jane BrownBROW
John A. LeeLEE*
James P. En, Sr.EN*
John O’NeillONEI
Mary Van BurenVANB
Juan De JesusDEJE
Gloria A. El-RoyEL-R
Mr. John SmithSMIT
Joe McCarthyMCCA
Pedro Torres-LopesTORR
Maria Lopez Moreno**LOPE
Binh To LaLA*
Nhat Thi PhamPHAM
Mark D’AllesandroDALL
Corporations:
The First National BankFIRS
The HideawayTHEH
A & B CafeA&BC
11TH Street Inc.11TH

SEQ 0048 JOB IRS27-012-005 PAGE-0046 PT 3 PGS 44-
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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
Sole Proprietor:
NameName Control
Mark Hemlock DBAHEML
The Sunshine Club
Partnership:
Robert Aspen and Bess WillowASPE
Harold Fir, Bruce Elm, and Joyce Spruce et al PtrFIR*
Estate:
Frank White EstateWHIT
Sheila Blue EstateBLUE
Trusts and Fiduciaries:
Daisy Corporation Employee Benefit TrustDAIS
Trust FBO The Cherryblossom SocietyCHER
Exempt Organization:
Laborer’s Union, AFL-CIOLABO
St. Bernard’s Methodist Church Bldg. FundSTBE
* Name Controls of less than four (4) significant characters must be left-justified and blank-filled.
**For Hispanic names, when two last names are shown for an individual, derive the name control from the first last name.
12Direct Sales
Indicator
11099 MISC only. Enter a ‘‘1’’ (one) to indicate sales of $5,000 or more of
consumer products to a person on a buy/sell, deposit/commission, or any other
commission basis for resale anywhere other than in a permanent retail
establishment. Otherwise, enter a blank.
*Note:If reporting direct sales only, use Type of Return ‘‘A’’ in position 22, and Amount Code 1 in position 23 of
the Payer ‘‘A’’ Record. All payment amount fields in the Payee ‘‘B’’ Record will contain zeros.
13Blank1Enter blank.
14Type of TIN1This field is used to identify the Taxpayer Identification Number (TIN) in
positions 15–23 as either an Employer Identification Number (EIN), or a Social
Security Number (SSN).* Enter the appropriate code from the following table:
* While not a ‘‘Required’’ field, this information is important for the correct processing of the payee’s TIN.
Type of TINType of Account
1EINA business, organization, sole proprietor, or other entity
2SSNAn individual, including a sole proprietor
BlankN/AIf the type of TIN is not determinable, enter a blank.
15–23Taxpayer
Identification
Number
9Required. Enter the nine digit Taxpayer Identification Number of the payee
(SSN or EIN). If an identification number has been applied for but not
received, enter blanks. Do not enter hyphens or alpha characters. All zeros,
ones, twos, etc. will have the effect of an incorrect TIN. If the TIN is not
available, enter blanks (See Note).
*Note:IRS/MCC contacts payers who have submitted payee data with missing TINs in an attempt to prevent
erroneous notices. Payers who submit data with missing TINs, and have taken the required steps to obtain
this information are encouraged to attach a letter of explanation to the required Form 4804. This will
prevent unnecessary contact from IRS/MCC. This letter, however, will not prevent backup withholding
notices (CP2100 or CP2100A) or penalties. (Refer to the Penalty section of the 1996 ‘‘Instructions for Forms
1099, 1098, 5498, and W–2G’’ for missing or incorrect TINs.)

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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
24–43Payer’s Account
Number for Payee
20Enter any number assigned by the payer to the payee (e.g., checking or savings
account number). Filers are encouraged to use this field. This number helps to
distinguish individual payee records and should be unique for each
document. Do not use the payee’s TIN since this will not make each record
unique. This information is particularly useful when corrections are filed. This
number will be provided with the backup withholding notification and may be
helpful in identifying the branch or subsidiary reporting the transaction. Do not
define data in this field in packed decimal format. If fewer than twenty
characters are used, filers may either left or right justify, filling the remaining
positions with blanks.
44IRA/SEP Indicator1Form 1099–R. Enter ‘‘1’’ (one) if reporting a distribution from an IRA or SEP;
otherwise, enter a blank (See Note). Form 5498. Enter ‘‘1’’ (one) if reporting
Simplified Employee Pension (SEP).
*Note:For Form 1099–R, generally, report the total amount distributed from an IRA or SEP in Payment Amount
Field 2 (Taxable Amount), as well as Payment Amount Field 1 (Gross Distribution) of the ‘‘B’’ Record.
Filers may indicate the taxable amount was not determined by using the Taxable Amount Not Determined
Indicator (position 48) of the ‘‘B’’ Record. However, still report the amount distributed in Payment Amount
Fields 1 and 2. Refer to the 1996 ‘‘Instructions for Forms 1099, 1098, 5498, and W–2G’’ for exceptions.
45–46Percentage of
Total Distribution
2Form 1099–R only. Use this field when reporting a total distribution to more
than one person, such as when a participant is deceased and a payer distributes
to two or more beneficiaries. Therefore, if the percentage is 100, leave this field
blank. If the percentage is a fraction, round off to the nearest whole number (for
example, 10.4 percent will be 10 percent; 10.5 percent or more will be 11
percent). Enter the percentage received by the person whose TIN is included in
positions 15–23 of the ‘‘B’’ Record. This field must be right-justified, and
unused positions must be zero-filled. If not applicable, enter blanks. Filers
need not enter this information for IRA or SEP distributions or for direct
rollovers.
47Total Distribution
Indicator (See
Note)
1Form 1099–R only. Enter a ‘‘1’’ (one) only if the payment shown for Amount
Code 1 is a total distribution that closed out the account; otherwise, enter a
blank.
*Note:A total distribution is one or more distributions within one tax year in which the entire balance of the
account is distributed. Any distribution that does not meet this definition is not a total distribution.
48Taxable Amount
Not Determined
Indicator
1Form 1099–R only. Enter a ‘‘1’’ (one) only if the taxable amount of the
payment entered for Payment Amount Field 1 (Gross Distribution) of the ‘‘B’’
Record cannot be computed; otherwise, enter blank. If Taxable Amount Not
Determined Indicator is used, enter ‘‘0’s’’ (zeros) in Payment Amount Field 2 of
the Payee ‘‘B’’ Record unless the IRA/SEP Indicator is present (See Note).
Please make every effort to compute the taxable amount.
*Note:If reporting an IRA or SEP distribution for Form 1099–R, the Taxable Amount Not Determined Indicator
may be used; but, it is not required. If the IRA/SEP Indicator is present, generally, the amount of the
distribution must be reported in both Payment Amount Fields 1 and 2. Refer to the 1996 ‘‘Instructions for
Forms 1099, 1098, 5498, and W–2G’’ for more information.

SEQ 0050 JOB IRS27-014-011 PAGE-0048 PT 3 PGS 48-
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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
49–50Blank2Enter blanks.
Payment Amount Fields
(Must be numeric) (See
Note 1)
Required. Filers should allow for all payment amounts. For those not used,
enter zeros. For example: If position 22, Type of Return, of the ‘‘A’’ Record is
‘‘A’’ (for 1099–MISC) and positions 23–31, Amount Codes, are ‘‘1247bbbbb’’.
This indicates the payer is reporting any or all four payment amounts (1247) in
all of the following ‘‘B’’ Records. (In this example, ‘‘b’’ denotes blanks in the
designated positions. Do not enter the letter ’b.’) Payment Amount 1 will
represent rents; Payment Amount 2 will represent royalties; Payment Amount 3
will be all ‘‘0’s’’ (zeros); Payment Amount 4 will represent Federal income tax
withheld; Payment Amounts 5 and 6 will be all ‘‘0’s’’ (zeros); Payment amount
7 will represent nonemployed compensation, and Payment Amounts 8 and 9 will
be all ‘‘0’s’’ (zeros). Each payment field must contain 10 numeric characters
(See Note 2). Each payment amount must be entered in U.S. dollars and cents.
The right-most two positions represent cents in the payment amount fields. Do
not enter dollar signs, commas, decimal points, or negative payments, except
those items that reflect a loss on Form 1099–B. Positive and negative amounts
are indicated by placing a ‘‘+’’ (plus) or ‘‘-’’ (minus sign) in the left-most
position of the payment amount field. A negative over punch in the units
position may be used, instead of a minus sign, to indicate a negative amount.
If a plus sign, minus sign, or negative over punch is not used, the number is
assumed to be positive. Negative over punch cannot be used in PC created files.
Payment amounts must be right-justified and unused positions must be zero-
filled. Federal income tax withheld cannot be reported as a negative amount on
any form.
*Note 1:Filers are instructed to enter numeric information in all payment fields when filing magnetically or
electronically. However, when reporting information on the statement to recipient, the payer may be
instructed to leave a box blank. Follow the guidelines provided in the paper instructions for the statement
to recipient.
*Note 2:If a payer is reporting a *money amount in excess of 9999999999 (dollars and cents), it must be reported
as follows:
(1)The first Payee ‘‘B’’ Record MUST contain *9999999999.
(2)The second Payee ‘‘B’’ Record will contain the remaining money amount.
*DO NOT SPLIT THIS FIGURE IN HALF.
51–60Payment
Amount 1*
10The amount reported in this field represents payments for Amount Code 1 in the
‘‘A’’ Record.
61–70Payment
Amount 2*
10The amount reported in this field represents payments for Amount Code 2 in the
‘‘A’’ Record.
71–80Payment
Amount 3*
10The amount reported in this field represents payments for Amount Code 3 in the
‘‘A’’ Record.
81–90Payment
Amount 4*
10The amount reported in this field represents payments for Amount Code 4 in the
‘‘A’’ Record.
91–100Payment
Amount 5*
10The amount reported in this field represents payments for Amount Code 5 in the
‘‘A’’ Record.
101–110Payment
Amount 6*
10The amount reported in this field represents payments for Amount Code 6 in the
‘‘A’’ Record.
111–120Payment
Amount 7*
10The amount reported in this field represents payments for Amount Code 7 in the
‘‘A’’ Record.
121–130Payment
Amount 8*
10The amount reported in this field represents payments for Amount Code 8 in the
‘‘A’’ Record.

SEQ 0051 JOB IRS27-014-011 PAGE-0049 PT 3 PGS 48-
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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
131–140Payment
Amount 9*
10The amount reported in this field represents payments for Amount Code 9 in the
‘‘A’’ Record.
* If there are discrepancies between the payment amount fields and the boxes on the paper forms, the instructions in this
revenue procedure govern.
141–160Blank20Enter blanks.
161Foreign Country
Indicator
1If the address of the payee is in a foreign country, enter a ‘‘1’’ (one) in this
field; otherwise, enter blanks. When filers use this indicator, they may use a free
format for the payee city, state, and ZIP Code. Address information must not
appear in the First or Second Payee Name Line.
162–201First Payee Name
Line
40Required. Enter the name of the payee (preferably surname first) whose
Taxpayer Identification Number (TIN) was provided in positions 15–23 of the
‘‘B’’ Record. Left justify and fill unused positions with blanks. If more space is
required for the name, utilize the Second Payee Name Line Field. If there are
multiple payees, only the name of the payee whose TIN has been provided
should be entered in this field. The names of the other payees may be entered in
the Second Payee Name Line Field. If reporting information for a sole
proprietor, the individual’s name must always be present, preferably on the First
Payee Name Line. The use of the business name is optional in the Second Payee
Name Line Field.
*Note:When reporting Form 1098, Mortgage Interest Statement, the ‘‘A’’ Record will reflect the name of the
recipient of the interest (the payer). The ‘‘B’’ Record will reflect the individual paying the interest (the
borrower/payer of record) and the amount paid. For Form 1099–S, the ‘‘B’’ Record will reflect the seller/
transferor information.
For Form 5498 Inherited IRAs, enter the beneficiary’s name followed by the word ‘‘beneficiary.’’ For example, ‘‘Brian
Young as beneficiary of Joan Smith’’ or something similar that signifies that the IRA was once owned by Joan Smith. Filers
may abbreviate the word ‘‘beneficiary’’ as, for example, ‘‘benef.’’ Refer to the 1996 ‘‘Instructions for Forms 1099, 1098,
5498, and W–2G.’’ The beneficiary’s TIN must be reported in positions 15–23 of the ‘‘B’’ Record.
202–241Second Payee
Name Line
40If there are multiple payees, (e.g., partners, joint owners, or spouses), use this
field for those names not associated with the TIN provided in position 15–23 of
the ‘‘B’’ Record or if not enough space was provided in the First Payee Name
Line, continue the name in this field. Do not enter address information. It is
important that filers provide as much payee information to IRS/MCC as possible
to identify the payee assigned the TIN. Left justify and fill unused positions
with blanks. Fill with blanks if no entries are present for this field.
242–281Payee Mailing
Address
40Required. Enter mailing address of payee. Street address should include
number, street, apartment or suite number (or P.O. Box if mail is not delivered
to street address). Left justify information and fill unused positions with blanks.
This field must not contain any data other than the payee’s mailing address.
For U.S. addresses, the payee city, state, and ZIP Code must be reported as a 29, 2, and 9 position field, respectively.
Filers must adhere to the correct format for the payee city, state, and ZIP Code. For foreign addresses, filers may use
the payee city, state, and ZIP Code as a continuous 40 position field. Enter information in the following order: city, province
or state, postal code, and the name of the country. When reporting a foreign address, the Foreign Country Indicator in
position 161 must contain a ‘‘1’’ (one).
282–310Payee City29Required. Enter the city, town or post office. Left justify information and fill
the unused positions with blanks. Enter APO or FPO if applicable. Do not enter
state and ZIP Code information in this field.
311–312Payee State2Required. Enter the valid U.S. Postal Service state abbreviations for states or
the appropriate postal identifier (AA, AE, or AP) described in Part A, Sec. 18.
313–321Payee ZIP Code9Required. Enter the valid nine digit ZIP Code assigned by the U.S. Postal
Service. If only the first five digits are known, left justify information and fill
the unused positions with blanks. For foreign countries, alpha characters are
acceptable as long as the filer has entered a ‘‘1’’ (one) in the Foreign Country
Indicator Field, located in position 161 of the ‘‘B’’ Record.

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Standard Payee ‘‘B’’ Record Format For
All Types of Returns up to Position 321
Record
Type
Payment
Year
Document
Specific/
Distribution
Code
2nd
TIN
Notice
(Optional)
Corrected
Return
Indicator
12–34–567
Name
Control
Direct
Sales
Indicator
Blank
Type
of
TIN
Taxpayer
Identification
Number
Payer’s
Account
Number
For Payee
8–1112131415–2324–43
IRA/SEP
Indicator
Percentage of
Total
Distribution
Total
Distribution
Indicator
Taxable
Amt Not
Determined
Indicator
Blank
4445–46474849–50
Payment
Amount 1
Payment
Amount 2
Payment
Amount 3
Payment
Amount 4
Payment
Amount 5
51–6061–7071–8081–9091–100
Payment
Amount 6
Payment
Amount 7
Payment
Amount 8
Payment
Amount 9
101–110111–120121–130131–140
Blank
Foreign
Country
Indicator
First
Payee Name
Line
Second
Payee Name
Line
Payee
Mailing
Address
141–160161162–201202–241242–281
Payee
City
Payee
State
Payee
Zip
Code
282–310311–312313–321

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Record Name: Payee ‘‘B’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
The following sections define the field positions for the different types of returns in the Payee ‘‘B’’ Record (positions
322–420):
(l)Forms 1098, 1099–DIV, 1099–G, 1099–INT, 1099–MISC, 1099–PATR, and 5498
(2)Form 1099–A
(3)Form 1099–B
(4)Form 1099–C
(5)Form 1099–OID
(6)Form 1099–R
(7)Form 1099–S
(8)Form W–2G
(1)Payee ‘‘B’’ Record—Record Layout Positions 322–420 Forms 1098, 1099–DIV, 1099–G, 1099–INT, 1099–MISC,
1099–PATR, and 5498
322–349Blank28Enter blanks.
350–416Special Data
Entries
67This portion of the ‘‘B’’ Record may be used to record information for state or
local government reporting or for the filer’s own purposes. Payers should
contact the state or local revenue departments for filing requirements. If this
field is not utilized, enter blanks.
417–418Combined Federal/
State Code
2If this payee record is to be forwarded to a state agency as part of the Combined
Federal/State Filing Program, enter the valid state code from Part A, Sec. 16,
Table 1. For those payers or states not participating in this program or for forms
not valid for state reporting, enter blanks.
419–420Blank2Enter blanks, or carriage return/line feed (cr/lf) characters.
Payee ‘‘B’’ Record—Record Layout Positions 322–420
Forms 1098, 1099–DIV, 1099–G, 1099–INT, 1099–MISC, 1099–PATR, and 5498
Blank
Special
Data
Entries
Combined
Federal/
State
Code
Blank
or
CR/LF
322–349350–416417–418419–420
(2)Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–A
322–349Blank28Enter blanks.
350–370Special Data
Entries
21This portion of the ‘‘B’’ Record may be used to record information for state or
local government reporting or for the filer’s own purposes. Payers should
contact the state or local revenue departments for the filing requirements. If this
field is not utilized, enter blanks.
371–376Date of Lender’s
Acquisition or
Knowledge of
Abandonment
6Form 1099–A only. Enter the acquisition date of the secured property or the
date they first knew or had reason to know the property was abandoned, in the
format MMDDYY (i.e., 052296). Do NOT enter hyphens or slashes.
377Liability Indicator1Form 1099–A only. Enter the appropriate indicator from the table below:

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Record Name: Payee ‘‘B’’ Record—Continued
Form 1099–a
Field
PositionField TitleLengthDescription and Remarks
Liability
Indicator
IndicatorUsage
1Borrower was personally liable for repayment of the debt.
BlankBorrower was not liable for repayment debt.
378–416Description of
Property
39Form 1099–A only. Enter a brief description of the property. For real property,
enter the address, or if the address does not sufficiently identify the property,
enter the section, lot and block. For personal property, enter the type, make and
model (e.g., Car-1995 Buick Regal or office equipment). Enter ‘‘CCC’’ for
crops forfeited on Commodity Credit Corporation loans. If fewer than 39
positions are required, left justify information and fill unused positions with
blanks.
417–418Blank2Enter blanks.
419–420Blank2Enter blanks, or carriage return/line feed (cr/lf) characters.
Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–A
Blank
Special
Data
Entries
Date of
Lender’s
Acquisition
or Abandonment
Liability
Indicator
Description
of Property
Blank
Blank
or
Cr/lf
322–349350–370371–376377378–416417–418419–420
(3)Payee ‘‘B’’ Record—Record Layout Position 322–420 Form 1099–B
Field
PositionField TitleLengthDescription and Remarks
322–349Blank28Enter blanks.
350–359Special Data
Entries
10This portion of the ‘‘B’’ Record may be used to record information for state or
local government reporting or the filer’s own purposes. Payers should contact the
state or local revenue departments for the filing requirements. If this field is not
utilized, enter blanks.
360Gross
Proceeds
Indicator
1Form 1099–B only. Enter the appropriate indicator from the following table,
otherwise, enter blanks.
IndicatorUsage
1Gross proceeds
2Gross proceeds less commissions and option premiums
361–366Date of Sale6 Form 1099–B only. For broker transactions, enter the trade date of the
transaction. For barter exchanges, enter the date when cash, property, a credit, or
scrip is actually or constructively received in the format MMDDYY (e.g.,
052196). Enter blanks if this is an aggregate transaction. Do NOT enter hyphens
or slashes
367–379CUSIP Number13Form 1099–B only. For broker transactions only, enter the CUSIP (Committee on
Uniform Security Identification Procedures) number of the item reported for
Amount Code 2 (stocks, bonds, etc.). Enter blanks if this is an aggregate
transaction. Enter ‘‘0’’ (zeros) if the number is not available. Right justify
information and fill unused positions with blanks.

SEQ 0004 JOB IRS27-018-008 PAGE-0053 PT 3 PGS 53-
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Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–A—Continued
Field
PositionField TitleLengthDescription and Remarks
380–418Description39Form 1099–B only. If fewer than 39 characters are required, left justify
information and fill unused positions with blanks. For broker transactions, enter
a brief description of the disposition item (e.g., 100 shares of XYZ Corp.). For
regulated futures and forward contracts, enter ‘‘RFC’’ or other appropriate
description and any amount subject to backup withholding (see Note). For
bartering transactions, show the services or property provided.
*Note:The amount withheld in these situations is to be included in Amount Code 4.
419–420Blank2Enter blanks, or carriage return/ line feed (cr/lf) characters.
Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–B
Blank
Special
Data
Entries
Gross
Proceeds
Indicator
Date of
Sale
CUSIP
Number
Description
322–349350–359360361–366367–379380–418
Blank
or
CR/LF
419–420
(4) Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–C
Field
PositionField TitleLengthDescription and Remarks
322–349Blank28Enter blanks.
350–370Special Data
Entries
21This portion of the ‘‘B’’ Record may be used to record information for state or
local government reporting or for the filer’s own purposes. Payers should
contact the state or local revenue departments for filing requirements. If this
field is not utilized, enter blanks.
371–376Date
Canceled
6Form 1099–C only. Enter the date the debt was canceled in the format of
MMDDYY (i.e., 052296). Do not enter hyphens or slashes.
377Bankruptcy
Indicator
1Form 1099–C only. Enter ‘‘1’’ (one) to indicate the debt was discharged in
bankruptcy.
IndicatorUsage
1Debt was discharged in bankruptcy.
BlankDebt was not discharged in bankruptcy.
378–416Debt
Description
39Form 1099–C only. Enter a description of the origin of debt, such as student
loan, mortgage, or credit card expenditure. If a combined Form 1099–C and
1099–A is being filed, also enter a description of the property.
417–418Blank2Enter blanks.
419–420Blank2Enter blanks, or carriage return/line feed (cr/lf).

SEQ 0005 JOB IRS27-018-008 PAGE-0054 PT 3 PGS 53-
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Payee ‘‘B’’ Record—Record Layout Positions 322–422 Form 1099–C
Blank
Special
Data
Entries
Date
Canceled
Bankruptcy
Indicator
Debt
Description
322–349350–370371–376377378–416
Blank
Blank
Or
CR/LF
417–418419–420
(5) Payee ‘‘B’’ Record—Record Layout Position 322–420 Form 1099–OID
Field
PositionField TitleLengthDescription and Remarks
322–349Blank28Enter blanks.
350–377Special Data
Entries
28This portion of the ‘‘B’’ Record may be used to record information for state
or local government reporting or for the filer’s own purposes. Payers should
contact the state or local revenue departments for filing requirements. If this
field is not used, enter blanks.
378–416Description39Required 1099–OID only. Enter the CUSIP number, if any. If there is no
CUSIP number, enter the abbreviation for the stock exchange and issuer, the
coupon rate, and year of maturity (e.g., NYSE XYZ 12 1/2 98). Show the
name of the issuer if other than the payer. If fewer than 39 characters are
required, left justify information and fill unused positions with blanks.
417–418Combined
Federal/
State Code
2If payee record is to be forwarded to a state agency as part of the Combined
Federal/State Filing Program, enter the valid state code from Part A, Sec. 16,
Table l. For those payers or states not participating in this program and for
forms not valid for state reporting, enter blanks.
419–420Blank2Enter blanks or carriage return/line feed (cr/lf) characters.
Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–OID
Blank
Special
Data
Entries
Description
Combined
Federal/
State Code
Blank
or
CR/LF
322–349350–377378–416417–418419–420
(6) Payee ‘‘B’’ Record—Record Layout Positions 322–420 1099–R
Field
PositionField TitleLengthDescription and Remarks
322–349Blank28Enter blanks.
350–396Special Data
Entries
47This portion of the ‘‘B’’ Record may be used to record information for state or
local government reporting or for the filer’s own purposes. Payers should
contact the state or local revenue departments for filing requirements. If this
field is not utilized, enter blanks.

SEQ 0006 JOB IRS27-018-008 PAGE-0055 PT 3 PGS 53-
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Record Name: Payee ‘‘B’’ Record Form 1099–R—Continued
Field
PositionField TitleLengthDescription and Remarks
397–406State Income
Tax Withheld
(Form 1099–R
only)
10State income tax withheld is for the convenience of the filers. This information
does not need to be reported to IRS. The payment amount must be right justified
and unused positions must be zero-filled. If not reporting state tax withheld, this
field may be used as a continuation of the Special Data Entries field.
407–416Local Income
Tax Withheld
(Form 1099–R
only)
10Local income tax withheld is for the convenience of the filers. This information
does not need to be reported to IRS. Payment amount must be right justified and
unused positions must be zero-filled. If not reporting local tax withheld, this
field may be used as a continuation of the Special Data Entries field.
417–418Combined
Federal/State
Code
2If this payee record is to be forwarded to a state agency as part of the Combined
Federal/State Filing Program, enter the valid state code from Part A, Sec. 16,
Table 1. For those payers or states not participating in this program or for forms
not valid for state reporting, enter blanks.
419–420Blank2Enter blanks, or carriage return/line feed (cr/lf) characters.
Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–R
Blank
Special
Data
Entries
State Income
Tax Withheld
(Form 1099–R
Only)
Local Income
Tax Withheld
(Form 1099–R
Only)
Combined
Federal/
State
Code
322–349350–396397–406407–416417–418
Blank
or
CR/LF
419–420
(7) Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–S
Field
PositionField TitleLengthDescription and Remarks
322–349Blank28Enter blanks.
350–372Special Data
Entries
23 This portion of the ‘‘B’’ Record may be used to record information for state or
local government reporting or for the filer’s own purposes. Payers should
contact the state or local revenue departments for filing requirements. If this
field is not utilized, enter blanks.
373–378Date of
Closing
6Required Form 1099–S only. Enter the closing date in the format MMDDYY
(e.g., 052296). Do not enter hyphens or slashes.
379–417Address or
Legal
Description
39Required Form 1099–S only. Enter the address of the property transferred
(including city, state, and ZIP Code). If the address does not sufficiently identify
the property, also enter a legal description, such as section, lot, and block. For
timber royalties, enter ‘‘TIMBER.’’ If fewer than 39 positions are required, left
justify information and fill unused positions with blanks.

SEQ 0007 JOB IRS27-019-009 PAGE-0056 IRS 3 PGS 56-
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Record Name: Payee ‘‘B’’ Record—Form 1099–S—Continued
Field
PositionField TitleLengthDescription and Remarks
418Property or
Services
To Be Received
1Required Form 1099–S only. Enter ‘‘1’’ (one) if the transferor received or will
receive property (other than cash and consideration treated as cash in computing
gross proceeds) or services as part of the consideration for the property
transferred. Otherwise, enter a blank.
419–420Blank2Enter blanks or carriage return/line feed (cr/lf) characters.
Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form 1099–S
Blank
Special
Data
Entries
Date of
Closing
Address
Or
Legal
Description
Property
Or
Services
Received
Blank
or
CR/LF
322–349350–372373–378379–417418419–420
*Note:When reporting Form 1099–S, the ‘‘B’’ Record will reflect the seller/transferor information.
(8)Payee ‘‘B’’ Record—Record Layout Positions 322–420 Form W–2G
Field
PositionField TitleLengthDescription and Remarks
322–352Blank31Enter blanks.
353–358Date Won6Required Form W–2G only. Enter the date of the winning event in the format
MMDDYY (e.g., 052296). Do not enter hyphens or slashes. This is not the
date the money was paid, if paid after the date of the race (or game).
359–373Transaction15Required Form W–2G only. For state-conducted lotteries, enter the ticket or
other identifying number. For keno, bingo, and slot machines, enter the ticket or
card number (and color, if applicable), machine serial number, or any other
information that will help identify the winning transaction. All others, enter
blanks.
374–378Race5Form W–2G only. If applicable, enter the race (or game) relating to the
winning ticket. Otherwise, enter blanks.
379–383Cashier5Form W–2G only. If applicable, enter the initials of the cashier making the
winning payment; otherwise, enter blanks.
384–388Window5Form W–2G only. If applicable, enter the window number or location of the
person paying the winnings; otherwise, enter blanks.
389–403First ID15Form W–2G only. For other than state lotteries, enter the first identification
number of the person receiving the winnings; otherwise, enter blanks.
404–418Second ID15Form W–2G only. For other than state lotteries, enter the second identification
number of the person receiving the winnings; otherwise, enter blanks.
419–420Blank2Enter blanks, or carriage return/line feed (cr/lf) characters.
Payee ‘‘B’’ Record — Record Layout Positions 322–420 Form W–2G
BlankDate WonTransactionRaceCashierWindow
First
Id
322–352353–358359–373374–378379–383384–388389–403

SEQ 0008 JOB IRS27-019-009 PAGE-0057 IRS 3 PGS 56-
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Second
Id
Blank
or
CR/LF
404–418419–420
Sec. 9. End of Payer ‘‘C’’ Record—Record Layout
.01 The End of Payer ‘‘C’’ Record is a fixed record length of 420 positions. The control total fields are each 15
positions in length.
.02 The ‘‘C’’ Record consists of the total number of payees and the totals of the payment amount fields filed by a given
payer and/or a particular type of return. The ‘‘C’’ Record must be written after the last ‘‘B’’ Record for each type of return
for a given payer. For each ‘‘A’’ Record and group of ‘‘B’’ Records on the file, there must be a corresponding ‘‘C’’
Record.
.03 In developing the ‘‘C’’ Record, for example, if a payer used Amount Codes 1, 3, and 6 in the ‘‘A’’ Record, the totals
from the ‘‘B’’ Records will appear in Control Totals 1, 3, and 6 of the ‘‘C’’ Record. In this example, positions 26–40, 56–
85, and 101–145 would be zero filled. Positions 146–420 would be blank filled.
.04 Payers/Transmitters should verify the accuracy of the totals since data with missing or incorrect ‘‘C’’ Records may be
returned for replacement.
Field
PositionField TitleLengthDescription and Remarks
1Record Type1Required. Enter ‘‘C.’’
2–7Number of
Payees
6Required. Enter the total numberof ‘‘B’’ Records covered by the preceding
‘‘A’’ Record. Right justify information and fill unused positions with zeros.
8–10Blank3Enter blanks.
Required. Accumulate totals of any payment amount fields in the ‘‘B’’ Record into the appropriate control total fields of
the ‘‘C’’ Record. Control totals must be right-justified and unused control total fields zero-filled. All control total fields
are 15 positions in length.
11–25Control15
Total 1
26–40Control15
Total 2
41–55Control15
Total 3
56–70Control15
Total 4
71–85Control15
Total 5
86–100Control15
Total 6
101–115Control15
Total 7
116–130Control15
Total 8
131–145Control15
Total 9
146–420Blank275Enter blanks. Filers may enter carriage return/line feed (cr/lf) characters in
positions 419-420.
End of Payer ‘‘C’’ Record—Record Layout
Record
Type
Number of
Payees
Blank
Control
Total 1
Control
Total 2
Control
Total 3
12–78–1011–2526–4041–55

SEQ 0009 JOB IRS27-019-009 PAGE-0058 IRS 3 PGS 56-
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End of Payer ‘‘C’’ Record—Record Layout—Continued
Control
Total 4
Control
Total 5
Control
Total 6
Control
Total 7
Control
Total 8
Control
Total 9
Blank
or
CR/LF
56–7071–8586–100101–115116–130131–145146–420
Sec. 10. State Totals ‘‘K’’ Record—Record Layout
.01 The State Totals ‘‘K’’ Record is a fixed record length of 420 positions. The control total fields are each 15 positions
in length.
.02 The ‘‘K’’ Record is a summary for a given payer and a given state in the Combined Federal/State Filing Program,
used only when state reporting approval has been granted.
.03 The ‘‘K’’ Record will contain the total number of payees and the totals of the payment amount fields filed by a given
payer for a given state. The ‘‘K’’ Record(s) must be written after the ‘‘C’’ Record for the related ‘‘A’’ Record.
.04 In developing the ‘‘K’’ Record, for example, if a payer used Amount Codes 1, 3, and 6 in the ‘‘A’’ Record, the totals
from the ‘‘B’’ Records coded for this state will appear in Control Totals 1, 3, and 6 of the ‘‘K’’ Record.
.05 There must be a separate ‘‘K’’ Record for each state being reported.
.06 Refer to Part A, Sec. 16 for the requirements and conditions that must be met to file via this program.
.07 Control total fields have been added for the accumulated totals of state and local withholding fields from the ‘‘B’’
Records for Form 1099–R only for each state being reported.
(1) State Totals ‘‘K’’ Record—Record Layout Forms 1099–DIV, 1099–G, 1099–INT, 1099–MISC, 1099–OID, 1099–
PATR, and 5498
Field
PositionField TitleLengthDescription and Remarks
1Record Type1Required. Enter ‘‘K.’’
2–7Number of
Payees
6Required. Enter the total number of ‘‘B’’ Records being coded for this state.
Right justify information and fill unused positions with zeros.
8–10Blank3Enter blanks.
Required. Accumulate totals of any payment amount fields in the ‘‘B’’ Records for each state being reported into the
appropriate control total fields of the appropriate ‘‘K’’ Record. Control totals must be right-justified, and unused control
total fields zero-filled. All control total fields are 15 positions in length.
11–25Control15
Total 1
26–40Control15
Total 2
41–55Control15
Total 3
56–70Control15
Total 4
71–85Control15
Total 5
86–100Control15
Total 6
101–115Control15
Total 7
116–130Control15
Total 8
131–145Control15
Total 9
146–416Blank271Reserved for IRS use. Enter blanks.
417–418Combined
Federal/
State Code
2Required. Enter the code assigned to the state which is to receive the
information. (Refer to Part A, Sec. 16 Table l.)

SEQ 0010 JOB IRS27-020-010 PAGE-0059 PT 3 PGS 59-
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Record Name: State Totals ‘‘K’’ Record—Continued
Field
PositionField TitleLengthDescription and Remarks
419–420Blank2Enter blanks or carriage return/line feed (cr/lf) characters.
State Totals ‘‘K’’ Record—Record Layout
Record
Type
Number of
Payees
Blank
Control
Total 1
Control
Total 2
Control
Total 3
12–78–1011–2526–4041–55
Control
Total 4
Control
Total 5
Control
Total 6
Control
Total 7
Control
Total 8
Control
Total 9
56–7071–8586–100101–115116–130131–145
Blank
Combined
Federal/
State Code
Blank
or
CR/LF
146–416417–418419–420
(2) State Totals ‘‘K’’ Record—Record Layout Form 1099–R
Field
PositionField TitleLengthDescription and Remarks
1Record Type1Required. Enter ‘‘K.’’
2–7Number of
Payees
6Required. Enter the total number of ‘‘B’’ Records being coded for this state.
Right justify and fill unused positions with zeros.
8–10Blank3Enter blanks.
Required. Accumulate totals of any payment amount fields in the ‘‘B’’ Records for each state being reported into the
appropriate control total fields of the appropriate ‘‘K’’ Record. Control totals must be right justified, and unused control
total fields zero-filled. All control total fields are 15 positions in length.
11–25Control15
Total 1
26–40Control15
Total 2
41–55Control15
Total 3
56–70Control15
Total 4
71–85Control15
Total 5
86–100Control15
Total 6
101–115Control15
Total 7
116–130Control15
Total 8
131–145Control15
Total 9
146–386Blank241Reserved for IRS use. Enter blanks.

SEQ 0011 JOB IRS27-020-010 PAGE-0060 PT 3 PGS 59-
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Record Name: State Totals ‘‘K’’ Record 1099–R—Continued
Field
PositionField TitleLengthDescription and Remarks
387–401Control Total
State Income
Tax Withheld
(Form 1099–R
only)
15Accumulate totals of the state income tax withheld field in the Payee ‘‘B’’
Record. Otherwise, enter blanks.
402–416Control Total
Local Income
Tax Withheld
(Form 1099–R
only)
15Accumulate totals of the local income tax withheld field in the Payee ‘‘B’’
Record. Otherwise, enter blanks.
417–418Combined
Federal/State
Code
2Required. Enter the code assigned to the state which is to receive the
information. (Refer to Part A, Sec. 16, Table 1.)
419–420Blank2Enter blanks or carriage return/line feed (cr/lf) characters.
State Totals ‘‘K’’ Record—Record Layout—1099–R
Record
Type
Number of
Payees
Blank
Control
Total 1
Control
Total 2
Control
Total 3
12–78–1011–2526–4041–55
Control
Total 4
Control
Total 5
Control
Total 6
Control
Total 7
Control
Total 8
Control
Total 9
56–7071–8586–100101–115116–130131–145
Blank
Control Total
State Income
Tax Withheld
(Form 1099–R
Only
Control Total
Local Income
Tax Withheld
(Form 1099–R Only)
Combined
Federal/
State
Code
Blank
or
CR/LF
146–386387–401402–416417–418419–420
Sec. 11. End of Transmission ‘‘F’’ Record—Record Layout
.01 The end of transmission ‘‘F’’ Record is a fixed record length of 420 positions. The ‘‘F’’ Record is a summary of
the number of payers in the entire file.
.02 This record should be written after the last ‘‘C’’ Record (or last ‘‘K’’ Record, when applicable) of the entire file.
Record Name: End of Transmission ‘‘F’’ Record
1Record Type1Required. Enter ‘‘F.’’
2–5Number of ‘‘A’’
Records
4Enter the total number of Payer ‘‘A’’ Records in the entire file (right justify and
zero fill) or enter all zeros.
6–30Zero25Enter zeros.
31–420Blank390Enter blanks. Filers may enter carriage return/line feed (cr/lf) characters in
positions 419–420.

SEQ 0012 JOB IRS27-020-010 PAGE-0061 PT 3 PGS 59-
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End of Transmission ‘‘F’’ Record—Record Layout
Record
Type
Number of
‘‘A’’ Records
Zeros
Blank
or
CR/LF
12–56–3031–420
Part C. Bisynchronous (Mainframe)
Electronic Filing Specifications
Sec. 1. General
.01 Bisynchronous electronic filing
of Forms 1098, 1099, 5498, and W–2G
information returns is offered as an
alternative to magnetic media (tape,
tape cartridge, or diskette) or paper
filing, but is not a requirement. This
method uses IBM 3780 communica-
tions protocols and is used primarily by
mainframe filers. Electronic filing will
fulfill the magnetic media requirements
for those payers who are required to
file magnetically. It may also be used
by payers who are under the filing
threshold requirement, but would prefer
to file their information returns this
way.
.02 The electronic filing of informa-
tion returns is not affiliated with the
Form 1040 electronic filing program.
These two programs are totally inde-
pendent, and filers must obtain separate
approval to participate in each of them.
All inquiries concerning the electronic
filing of information returns should be
directed to IRS/MCC. IRS/MCC per-
sonnel cannot answer questions or
assist taxpayers in the filing of Form
1040 tax returns. Filers with questions
of this nature will be directed to the
Taxpayer Service toll free number
(1-800-829-1040) for assistance.
.03 Filers participating in the
electronic filing program for informa-
tion returns will submit their returns to
IRS/MCC by way of modems, and not
through magnetic media or paper filing.
.04 If a request for extension is
approved, transmitters who file elec-
tronically will be granted an extension
of 30 days to file. Part A, Sec. 11,
explains procedures for requesting ex-
tensions of time. Filers are encouraged
to file their data as soon as possible.
.05 The formats of the ‘‘A’’, ‘‘B’’,
‘‘C’’, ‘‘K’’, and ‘‘F’’ Records are the
same for electronically filed records as
they are for 5
1
⁄4- and 3
1
⁄2-inch diskettes,
tapes, and tape cartridges. For
electronically filed documents, each
transmission is considered a separate
file; therefore, each transmission must
have an End of Transmission (EOT)
‘‘F’’ Record.
Sec. 2. Electronic Filing Approval
Procedure
.01 Filers must obtain, or already
have, a Transmitter Control Code
(TCC) assigned to them prior to
submitting their files electronically.
(Filers who currently have a TCC for
magnetic filing do not have to request
a second TCC for electronic filing.)
Refer to Part A, Sec. 7, for information
on how to obtain a TCC.
.02 Filers using bisynchronous pro-
tocols must obtain an IRS/MCC-
assigned password prior to submitting
test or actual data files. To obtain a
password, the following steps must be
taken:
(a)Bisynchronous filers who al-
ready have a TCC must submit
either Form 4419 or a letter to
indicate that they wish to file
information returns electroni-
cally. Another TCC will not
be assigned. If a letter is
submitted, it must contain the
following:
1 )N a m e a n d a d d r e s s o f
transmitter.
2)Transmitter Control Code.
3)Name and phone number of
a contact person within the
filer’s organization to whom
a password will be assigned.
(b)Within 30 days of receiving
the application or letter, IRS/
MCC will send Form 6086,
T i m e S h a r i n g O p e r a t i o n
(TSO) Password Assignment,
to the filer which will contain
the password to be used for
electronic submissions.
(c)Upon receipt of Form 6086,
the user (person who will
actually transmit the data) will
separate the acknowledgment
from the password. Both the
user and the user’s manager
must sign the acknowledgment
and mail to:
)Chief, Security and Disclosure
Branch
IRS, Martinsburg Computing Center
P. O. Box 1208, MS-370
Martinsburg, WV 25401
(d)The users or filers should retain
a copy of the signed acknowl-
edgment for their records. It is
the filer’s responsibility to en-
sure that the password is not
compromised. Access to IRS/
MCC computers will not be al-
lowed without a valid password.
After a password is received and
the acknowledgment returned,
the filer may submit a data file.
(e)For security reasons, all bi-
synchronous passwords will ex-
pire periodically, and a new
password will automatically be
assigned. If filers have any ques-
tions relating to the security
procedures, and/or they need to
report their password has been
compromised, they must contact
IRS/MCC as soon as possible at:
)IRS/MCC
Information Returns Branch
P. O. Box 1359, MS-360
Martinsburg, WV 25401
or by calling: 304-263-8700.
.03It is the user’s responsibility to
remember the password and not allow
the password to be compromised.
Sec. 3. Test Files
.01Filers are not required to submit
a test file; however, the submission of
a test file is encouraged for first time
electronic filers in order to resolve any
data or communication problems prior
to the filing season. If filers wish to
submit an electronic test file for Tax
Year 1996 (returns to be filed in 1997),
it must be submitted to IRS/MCC no
earlier than November 1, 1996,
through December 31, 1996.
.02If a filer encounters problems
while transmitting electronic test files,
contact IRS/MCC for assistance.
.03A password must be obtained
before submitting an electronic test file.

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.04Bisynchronous electronic test
files will be processed and filers will
be notified as to the acceptability of
their data within 5 workdays of the
date the data and transmittal Form
4804 are received by IRS/MCC.
.05A test file is required from filers
who want approval for the Combined
Federal/State Filing Program. See Part
A, Sec. 16, for further details.
Sec. 4. Electronic Submissions
.01Electronically filed information
may be submitted to IRS/MCC 7 days
a week, 24 hours a day, except for
routine maintenance/backup which is
performed at 4:00 a.m. Eastern Time.
Technical assistance will be available
Monday through Friday between 8:30
a.m. and 4:30 p.m. Eastern Time by
calling 304-263-8700.
.02Lengthy transmissions (100,000
or more records) are not encouraged
since the transmission may be inter-
rupted by line noise problems. It is
advisable to break lengthy files into
multiple transmissions.
.03The time required to transmit
information returns electronically will
vary depending on the modem speed, if
IBM 3780 data compression is used,
and if the records are blocked. The
following transmission rate was based
on an actual test file received at MCC
using 4800 bps, no compression, and
one record per block:
4500 records50 minutes
Sec. 5. Transmittal Requirements
.01All data submitted electronically
is verified by transmittal Form 4804.
The transmitter must send the signed
Form 4804 the same day the transmis-
sion is made. No return is considered
filed until a Form 4804 is received by
IRS/MCC.
.02Form 4804 can be ordered by
calling the IRS toll free forms and
publications order number 1-800-TAX-
FORM (1-800-829-3676) or it may be
computer-generated. If a filer chooses
to computer-generate Form 4804, all of
the information contained on the origi-
nal form, including the affidavit, must
also be contained on the computer-
generated form.
.03The filer whose TCC is used in
the ‘‘A’’ Record is responsible for
submitting the transmittal Form 4804.
.04Forms 4804 may be mailed to
the following addresses:
If by Postal Service:
IRS-Martinsburg Computing Center
)Attn: Electronic Filing Coordi-
nator
P. O. 1359, MS-360
Martinsburg, WV 25401-1359
If by truck or air freight:
IRS-Martinsburg Computing Center
(Attn: Electronic Filing Coordi-
nator
Route 9 and Needy Road, MS-360
Martinsburg, WV 25401
.05A signed Form 4804 submitted
for electronically filed information re-
turns may be faxed to IRS/MCC at the
following number: 304-264-5602.
Faxed transmittals will allow IRS/MCC
to begin processing the file imme-
diately; however, a filer must still send
the actual signed Form 4804 the same
day as the electronic submission.
Sec. 6. IBM 3780 Bisynchronous
Communication Specifications
.01Transmissions using IBM 3780
bisynchronous protocols must be in
EBCDIC character code. Modems must
be compatible with either Bell 208B
for 4800 bps transmissions, AT&T
2296A for 9600 bps transmissions, or
Hayes OPTIMA 288 V.FC Smartmodem
for 14400 bps transmissions. These
modems are dial-up type modems using
the Public Switched Telephone Net-
work. IBM 3780 data compression is
acceptable for any bisynchronous trans-
mission. Records may be blocked up to
4096 bytes with INTER RECORD
SEPARATORS.
.02 IRS/MCC will accept informa-
tion returns filed electronically over
switched telecommunications network
circuits. For 4800 bps, the circuit will
be 304-264-7080. For 9600 bps, the
circuit will be 304-264-7040. For
14400 bps, the circuit will be
304-264-7045. These circuits are
equipped for bisynchronous transmis-
sion using the IBM 3780 protocol.
.03 The 4800 bps line terminates at a
Bell 208B modem. The Bell 208B
modem uses phase-shift keying and
eight-phase modulation to transmit bin-
ary serial data signals over the tele-
phone line in half-duplex mode. The
following options have been selected:
—Transmit Level set to –4 dBm
—Compromise Equalizer in (4–Db
Slope)
—DSR off in Analog Loop Mode
—Automatic Answer
—Transmitter Internally Timed
—RS–CS Interval of 50 ms
.04The 9600 bps line terminates at
an AT&T Dataphone II 2296A modem.
The AT&T 2296A modem is a full-
duplex, CCITT V.32 compatible unit
which operates at 9600 bps or 4800 bps
(fallback). The following options have
been selected:
—Receiver Responds to Remote
Loopback
—Loss-of-Carrier Disconnect
—Received-Space Disconnect
—Send-Space Disconnect
—Automatic Answer
—Answer on Ring 1
—DTR Interlock
—Retrain Enable
—Internal Timing
—CTS Controlled by RTS
—0—1 ms RTS to CTS Delay
—CTS Dependent on Carrier
—RR Indicates Carrier
—9600 Trellis Coding
—4800 bps Fallback
—4 dB Compromise Equalization
.05The 14400 bps line terminates at
a Hayes OPTIMA 288 V.FC smart-
modem. The Hayes OPTIMA smart-
modem is a half-duplex, ITU-T (for-
merly CCITT) V.32 and V.32 bis
compatible unit which operates at
14400 bps, 9600 bps, or 4800 bps
(fallback). The following options have
been selected:
—Monitor DTR signal
—Assert DSR signal after hand-
shake negotiation, but before connect
result code
—Ring control S=1
Sec. 7. Bisynchronous Electronic
Filing Record Specifications
.01For bisynchronous filing there
are two additional identifier records
which must be used to transmit data.
These records are 420 positions in
length and are the first ($$REQUEST)
and second ($$ADD) records sent in an
electronic transmission. The purpose of
these records is to provide the pass-
word and identity of the transmitter.
The $$REQUEST, $$ADD, and the
data file should be transmitted as one
file. In some cases, filers have at-
tempted to send the $$REQUEST and

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$$ADD as separate files. Doing this will result in a failed transmission.
.02With the exception of these additional records, the file format for electronic filing is the same as for magnetic media
filing. The format of each of these records is as follows:
Record Name: $$REQUEST
Field
PositionField TitleLengthDescription and Remarks
1–20$$REQUEST
Identifier
Record
20Enter the following characters:
$$REQUEST ID=MSGFILE
21–420Blank400Enter blanks.
Electronic Filing Identifier $$REQUEST RECORD—Record Layout
$$REQUEST
Identifier
Record
Blank
1–2021–420
.03Upon making contact with IRS/MCC and furnishing a valid password in the $$ADD identifier record, a data
transmission session will commence. The transmission will continue until an End of Transmission (EOT) ‘‘F’’ record is
received. At the end of each transmission, the following message should be received electronically by the filer: ‘‘DATA
RECEIVED AT MCC’’ and the line will be disconnected. If this message is not received, there was a problem with the
submission, and the filer should contact IRS/MCC immediately.
.04Upon receiving a data file and transmittal Form 4804, IRS/MCC will release the data for further processing. If the
media cannot be processed, the filer will be notified by either letter or telephone that the data must be retransmitted. This
file name, if necessary, will be provided by IRS/MCC and is to be placed in positions 45–51 of the $$ADD record when the
file is retransmitted.
Record Name: $$ADD
Field
PositionField TitleLengthDescription and Remarks
1–9$$ ADD
Identifier
Record
9Enter the following characters: $$ADD ID=
10–17Password8Enter the password assigned by IRS/MCC. For information concerning the
password, see Part C, Sec. 2.
18Blank1Enter a blank.
19–26BATCHID8Enter the following characters: BATCHID=
27Quote1Enter a single quote (’).
28–43Transmitter Name16Enter the transmitter’s name. This name should remain consistent in all
transmissions. If the transmitter’s name exceeds 16 positions, truncate the name.
44Type of File
Indicator
1Enter the Type of File Indicator from the list below:
O =Original filing
T =Test File
C =Correction file
R =Replacement file
E =Extension File
45–51Replacement File
Name
7Use this field only if this is a replacement file. Enter the replacement file
name which IRS/MCC has assigned to this file. This file name will be provided
to the filer in the letter notifying them that a replacement file is necessary. If
contact is made by telephone, the replacement file name will be given to the
filer by IRS/MCC at that time. For other than replacement files, this field will
contain blanks.

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Record Name: $$ADD—Continued
Field
PositionField TitleLengthDescription and Remarks
52Quote1Enter a single quote (’).
53–420Blanks368Enter blanks.
Electronic Filing Identifier $$ADD Record—Record Layout
$$ ADD
Identifier
Record
PasswordBlankBatchidQuote
Transmitter
Name
1–910–171819–262728–43
Type of
File
Indicator
Replacement
File Name
QuoteBlanks
4445–515253–420
Part D. Asynchronous (IRP–BBS)
Electronic Filing Specifications
Sec. 1. General
.01 Asynchronous electronic filing of
Forms 1098, 1099, 5498, and W–2G,
originals, corrections, and replacements
of information returns is offered as an
alternative to magnetic media (tape,
tape cartridge, or diskette) or paper
filing, but is not a requirement.
Electronic filing using the Information
Reporting Program Bulletin Board Sys-
tem (IRP–BBS) will fulfill the mag-
netic media requirements for those
filers who are required to file magnet-
ically. It may also be used by those
payers who are under the filing thresh-
old requirement, but would prefer to
file their information returns this way.
If the original file was sent magnet-
ically, but was returned for replace-
ment, the replacement may be transmit-
ted electronically. Also, if the original
file was submitted via magnetic media,
any corrections may be transmitted
electronically.
.02The electronic filing of informa-
tion returns is not affiliated with the
Form 1040 electronic filing program.
These two programs are totally inde-
pendent, and filers must obtain separate
approval to participate in each of them.
All inquiries concerning the electronic
filing of information returns should be
directed to IRS/MCC. IRS/MCC per-
sonnel cannot answer questions or
assist taxpayers in the filing of Form
1040 tax returns. Filers with questions
of this nature will be directed to the
Taxpayer Service toll-free number
(1-800-829-1040) for assistance.
.03 Filers participating in the
electronic filing program for informa-
tion returns will submit their returns to
IRS/MCC by way of modems and not
through magnetic media or paper filing.
Files submitted in this manner must be
in standard ASCII code.
.04 If a request for extension is
a p p r o v e d , t r a n s m i t t e r s w h o f i l e
electronically will be granted an exten-
sion of 30 days to file. Part A, Sec. 11,
explains procedures for requesting ex-
tensions of time. Filers are encouraged
to file their data as soon as possible.
.05 The formats of the ‘‘A’’, ‘‘B’’,
‘‘C’’, ‘‘K’’, and ‘‘F’’ Records are the
same for electronically filed records as
they are for 5
1
⁄4- and 3
1
⁄2-inch diskettes,
tapes, and tape cartridges and must be
i n s t a n d a r d A S C I I c o d e. F o r
electronically filed documents, each
transmission is considered a separate
file; therefore each transmission must
have an End of Transmission (EOT)
‘‘F’’ Record.
Sec. 2. Electronic Filing Approval
Procedure
.01 Filers must obtain, or already
have, a Transmitter Control Code
(TCC) assigned to them prior to sub-
mitting their files electronically. (Filers
who currently have a TCC for magnetic
filing do not have to request a second
TCC for electronic filing.) Refer to
Part A, Sec. 7 for information on how
to obtain a TCC.
.02Once a TCC is obtained, filers
using IRP-BBS assign their own pass-
words and do not need special
approval.
.03With all passwords, it is the
user’s responsibility to remember the
password and not allow the password
to be compromised. However, if filers
d o f o r g e t t h e i r p a s s w o r d , c a l l
304-263-8700 for assistance.
* Note:Passwords on the IRP–
BBS are case sensitive.
Sec. 3. Test Files
.01 Filers are not required to submit
a test file; however, the submission of
a test file is encouraged for first time
electronic filers in order to resolve any
data or communication problems prior
to the filing season. If filers wish to
submit an electronic test file for Tax
Year 1996 (returns to be filed in 1997),
it must be submitted to IRS/MCC no
earlier than November 1, 1996,
through December 31, 1996.
.02 If a filer encounters problems
while transmitting the electronic test
files, contact IRS/MCC for assistance.
.03Filers can verify the status of
their transmitted test data by dialing the

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65
IRP–BBS. This information will be
available within two workdays after
their transmission is received by IRS/
MCC.
.04A test file is required from
filers who want approval for the
Combined Federal/State Filing Pro-
gram. See Part A, Sec. 16 for further
details.
Sec. 4. Electronic Submissions
.01Electronically filed information
may be submitted to IRS/MCC 24
hours a day, 7 days a week. Technical
assistance will be available Monday
through Friday between 8:30 a.m. and
4:30 p.m. Eastern Time by calling
304-263-8700.
.02Filers may submit as many docu-
ments as they choose electronically.
Filers are allowed 240 minutes a day;
however, more time may be re-
quested if needed. It may be advan-
tageous to break down large files (files
in excess of two hours of transmission
time) into several smaller files. For
example, if large files contain several
types of returns or payers, transmit each
return or payer as a separate file. As a
result, if only one of the files is
incorrect, a replacement would be
needed for only the incorrect file.
.03Do not transmit data using
IRP–BBS January 1 through Janu-
ary 7. This will allow time for the
IRP–BBS to be updated to reflect
current year changes.
.04Data compression is encouraged
when submitting information returns by
way of the IRP–BBS. MCC has the
ability to decompress files created
using several popular software com-
pression programs such as ARC,
LHARC, and PKZIP. Software data
compression can be done alone or in
conjunction with V.42bis hardware
compression.
The time required to transmit infor-
mation returns electronically will vary
depending on the modem speed and the
type of data compression used, if any.
However, transmissions to IRP–BBS
will be significantly faster than
electronic filing to the mainframe. The
time required to transmit a file can
be reduced by as much as 85 percent
by using software compression and
hardware compression.
The following are actual transmission
rates achieved in test uploads at MCC
using compressed files (PKZIP) and the
xmodem protocol. The actual transmis-
sion rates will vary depending on the
protocol that is used. (Uploads will be
approximately 25 percent faster when
using the XMODEM-1K or ZMODEM
protocols.)
Transmission
Speed in bps500 Records2500 Records10000 Records
24002 min 55 sec10 min 25 sec55 min 10 sec
96001 min 5 sec4 min 35 sec21 min 20 sec
1920041 sec2 min 51 sec13 min 23 sec
3840025 sec1 min 55 sec9 min 10 sec
.05Files submitted to IRP–BBS
must have a unique filename; therefore,
the IRP–BBS will build the filename
that must be used. The name will con-
sist of the filer’s TCC, submission type
(T = Test, P = Production, C =
Correction, and R = Replacement) and
a sequence number. Filers may call the
file anything they choose on their end.
The sequence number will be incre-
mented every time they send, or at-
tempt to send, a file. Record the upload
date, time, and filename. This informa-
tion will be needed by MCC in order to
identify the file if assistance is required
and to complete Form 4804.
Sec. 5. Transmittal Requirements
.01The results of the electronic
transmission will be posted to the (F)ile
Status area of the IRP–BBS, however,
no further processing will occur until
the signed Form 4804 is received. The
transmitter must send the signed Form
4804 the same day the electronic
transmission is made. No return is
considered filed until a Form 4804 is
received by IRS/MCC.
.02Form 4804 can be ordered by
calling the IRS toll-free forms and
publication order number 1-800-TAX-
FORM, (1-800-829-3676), downloaded
from the IRP–BBS, or it may be
computer-generated. A copy of the
form is also available in the back of
this publication. If a filer chooses to
computer-generate Form 4804, all of
the information contained on the origi-
nal form, including the affidavit, must
also be contained on the computer-
generated form.
.03The filer whose TCC is used in
the ‘‘A’’ Record is responsible for
submitting the transmittal Form 4804.
.04Forms 4804 may be mailed to
the following addresses:
If by Postal Service:
I R S - M a r t i n s b u r g C o m p u t i n g
Center
)Attn: Electronic Filing Coordi-
nator
P. O. Box 1359, MS-360
Martinsburg, WV 25401-1359
If by truck or air freight:
I R S - M a r t i n s b u r g C o m p u t i n g
Center
(Attn: Electronic Filing Coordi-
nator
Route 9 and Needy Road,
MS-360
Martinsburg, WV 25401
Sec. 6. Information Reporting
Program Bulletin Board System
(IRP–BBS) Specifications
.01The IRP–BBS is an electronic
bulletin board system available to filers
of information returns. In addition to
filing information returns electronically,
the IRP–BBS provides other ca-
pabilities. Some of the advantages of
IRP–BBS are as follows:
(1)Notification within two work-
days as to the acceptability of
the data transmitted.
(2)Immediate access to the latest
changes and updates that af-
fect the Information Reporting
Program at IRS/MCC (pro-
gram, legislative, etc.).
(3)Access to publications such as
the Publication 1220 as soon
as they are available.

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(4)Capability to communicate
with IRS/MCC personnel.
(5)Ability to retrieve information
and files applicable to the
IRP–BBS.
.02The IRP–BBS is available for
public use and accessible using various
personal computer communications
equipment; however, electronic submis-
sion of information returns is limited to
holders of valid TCCs. A TCC is not
needed to access those portions of the
IRP–BBS that contain forms and pub-
lications or to leave questions or
messages for IRS/MCC personnel.
.03Filers using IRP–BBS can deter-
mine the acceptability of files submit-
ted by checking the file status area of
the bulletin board. These reports are
not immediately available but will be
available two workdays after the trans-
mission is received by IRS/MCC.
.04Contact the IRP–BBS by dialing
304-264-7070. The communication
software settings for IRP–BBS are:
—No parity
—Eight data bits
—One stop bit
—Full duplex
The communication software should be
set up to use the fastest speed allowed
by the filer’s modem.
.05Due to the large number of com-
munication products available, it is
impossible to provide specific informa-
tion on a particular software package or
hardware configuration. Filers should
contact their software or hardware
supplier for assistance.
.06IRP–BBS software provides a
menu-driven environment allowing ac-
cess to different parts of IRP–BBS.
Whenever possible, IRS/MCC person-
nel will provide assistance in resolving
any communication problems with
IRP–BBS.
.07IRP–BBS can be accessed at
speeds from 1200 to 28,800 bps. The
speed is automatically negotiated for
connection at the speed of the calling
modem. The communication standards
supported include Industry Standard
212A, V.22bis, V.32, V.32bis, V.34,
and V.FC. Point-to-point error control
is supported using the V.42 ITU-T
standard or MNP 2–4. Data compres-
sion is supported using V.42bis ITU-T
standard or MNP5.
Sec. 7. IRP–BBS First Logon
Procedures
.01The following information will
be requested to set up the filer’s user
profile when logging onto the IRP–
BBS for the first time.
(A)Enter the letter, that corre-
sponds to the filer’s terminal,
from the following:
,A.IBM PC,B.IBM w/ANSI,C.Atari
,D.ADM–3,E.H19/Z19/H89,F.Televid 925
,G.TRS–80,H.Vidtex,I.VT–52
,J.VT–100,CR.if none of the above
Most PCs, clones, etc., will select the IBM PC emulation. Machines with color, CGA, EGA, or VGA should select IBM
w/ANSI.
(B)Upper/lower case, line feed needed, O (zero) nulls after each ,CR., do you wish to modify this? (Most users
answer no.)
Common User Problems
ProblemProbable CauseSolution
File does not upload/downloadNot starting communication when
prompted by ‘Awaiting Start Signal’
Start upload/download on filers end
All files not processedCompressing several files into one
filename
Compress only one file for every
filename
Replacement neededOriginal data incorrectReplacement must be submitted
within 45 days of original
transmission
Cannot determine file statusNot dialing back thru IRP–BBS to
check the status of the file
Within 24 to 48 hours after sending
a file, check under (F)ile Status for
notification of acceptability
Transfer aborts before it startsTransfer protocol mismatchEnsure protocols match on both the
sending and receiving ends
Loss of carrier during sessionIncorrect modem setting on user’s
end
Reference your modem manual about
increasing the value of the S10
register
Unreadable screens after selecting
‘‘IBM w/ANSI’’
ANSI.SYS driver not loaded in the
user’s PC
Select non ANSI under (Y)our
settings

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IRS Encountered Problems
ProblemProbable CauseSolution
IRS cannot complete final processing
of data
User did not mail the Form 4804Mail completed Form complete final
4804 the same day as the electronic
transmission
IRS cannot determine which file is
being replaced
User did not indicate which file is
being replaced
Must enter the filename that is being
being replaced under the replacement
option
IRS cannot determine the type of file
being sent
User incorrectly indicated T, P, C, or
R for the type of file
When prompted, enter the correct
type of file for data being sent
Incorrect file not replaced within 45
days
User did not dial back thru IRP–BBS
to check the status of file
Within two workdays check under
(F)ile Status for notification of
acceptability
Duplicate dataTransmitter sends corrections for en-
tire file
Only submit corrections for incorrect
records
Part E. Magnetic/Electronic
Specification for Extensions of Time
Sec. 1. General Information
.01The specifications in Part E
include the required 200-byte record
format for extensions of time to file
requests submitted on magnetic media
or via electronically. Also included are
the instructions for the information that
is to be entered in the record. Filers
are advised to read this section in its
entirety to ensure proper filing.
.02Only filers who have been as-
signed a Transmitter Control Code may
request an extension of time magnet-
ically or electronically. If you meet the
threshold of more than 50 payers when
requesting an extension but are below
the 250 documents threshold, you must
still submit a Form 4419, Application
f o r F i l i n g I n f o r m a t i o n R e t u r n s
Magnetically/Electronically. Requests
for extensions of time may be made for
Forms 1098, 1099, 5498, W–2G, W–2,
and 1042–S.
.03For Tax Year 1996 (returns due
to be filed in 1997), transmitters
requesting an extension of time to file
for more than 50 payers (not payees)
are required to file the extension
request on magnetic media or
electronically. Transmitters requesting
an extension of time for 10 to 50
payers (not payees) are encouraged to
file the request magnetically or elec-
tronically. The request may be filed on
tape, tape cartridge, 5
1
⁄4- and 3
1
⁄2-inch
diskette, or electronically through the
IRP–BBS.
.04For extension requests filed on
magnetic media, the transmitter must
fax the completed, signed Form 8809,
Request for Extension of Time to File
Information Returns, in the same pack-
age as the corresponding media. For
extension requests filed electronically,
the transmitter must FAX the Form
8809 the same day the transmission is
made.
.05Transmitters should not sub-
mit a list of payer names and TINS
with the Form 8809 with the mag-
netic media or electronic files. Box 6
of the Form 8809 must be completed
with the total number of payer records
(total number of payers) on the
transmitter’s extension of time file.
.06To be considered, an extension
request must be postmarked or trans-
mitted by the due date of the returns;
otherwise, the request will be denied.
.07The extension record format is
also on the IRP–BBS and can be
downloaded. See Part D for more
information on how to contact the
IRP–BBS.
.08A magnetically-filed request for
an extension of time should be sent
using the following addresses:
If by Postal:
I R S - M a r t i n s b u r g C o m p u t i n g
Center
)Attn: Extension of Time Coordi-
nator
P. O. Box 879, MS-360
Kearneysville, WV 25430
If by truck or air freight:
I R S - M a r t i n s b u r g C o m p u t i n g
Center
(Attn: Extension of Time Coordi-
nator
Route 9 and Needy Road,
MS-360
Martinsburg, WV 25401
*Note:Due to the large volume of
mail received by IRS/MCC
and the time factor in-
volved in processing the
Form 8809, it is imperative
that the attention line be
present on all envelopes or
packages containing Exten-
s i o n o f T i m e ( E O T )
requests.
.09If using a delivery service other
than postal service, the actual date of
receipt by IRS/MCC will be used as
the submitted date. This should be
considered in meeting filing require-
ments timely.
.10Transmitters who submit their
extensions of time requests magnet-
ically or electronically will receive a
letter from IRS/MCC with an attached
list of the payers specifying approval
and/or denial.
.11Do not submit tax year 1996
extensions of time to file requests on
magnetic media or electronically before
January 1, 1997.
.12Filers may request an extension
of time as soon as they are aware that
an extension is necessary but not later
than the due date of the return. It will
take a minimum of 30 days for IRS/
MCC to respond to an extension
request. Under certain circumstances a
request for an extension of time could
be denied. In such cases, the transmit-
ter receives a denial letter. When this
denial letter is received, the transmitter
has 20 days to provide the additional or
necessary information and resubmit the
extension request to IRS/MCC.

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.13Each piece of magnetic media
must have an external media label
containing the following information:
(a)Transmitter name
(b)Transmitter Control Code
(TCC)
(c)Tax year
(d)The words ‘‘Extension of
Time’’
(e)Record count
.14A request for an extension of
time to file is not automatically
granted. Approval or denial is depend-
ent on information provided on the
Form 8809.
.15If the first request for an exten-
sion of time to file was submitted
magnetically or electronically, addi-
tional extension requests should be
submitted in the same manner.
.16If an additional extension of
time is needed, a second Form 8809
may be submitted before the end of the
initial extension with a postmark re-
flecting the date mailed. Line 7 on the
form should be checked to indicate that
the original extension has been re-
ceived and the additional extension is
being requested.
.17 See Part A, Sec. 11, for complete
information on requesting an extension
of time to file information returns. If
there are additional questions or con-
cerns, contact IRS/MCC.
Sec. 2. Magnetic Tape, Tape
Cartridge, 5
1
⁄4- and 3
1
⁄2-inch Diskette
and IRP–BBS Specifications
.01Tape specifications are as
follows:
(a)9 track.
(b)EBCDIC (Extended Binary
Coded Decimal Interchange
Code) or ASCII (American
Standard Coded Information
Interchange) recording mode.
(c)1600 or 6250 BPI.
(d)A block must not exceed
32,600 tape positions and must
be a multiple of 200.
(e)Record length of 200 bytes.
(f)Labeled or unlabeled tapes
may be submitted.
.02Tape cartridge specifications are
as follows:
(a)Must be IBM 3480, 3490, or
AS400 compatible.
(b)Must meet American National
Standard Institute (ANSI)
standards and have the follow-
ing characteristics:
(1)Tape cartridges will be 1/2-
inch tape contained in plas-
tic cartridges which are ap-
proximately 4-inches by
5 - i n c h e s b y 1 - i n c h i n
dimension.
(2)Magnetic tape will be chro-
mium dioxide particle based
1/2-inch tape.
(3)Cartridges will be 18-track
or 36-track parallel. Indicate
on the external media label
if the tape cartridge is 18-
or 36-track.
(4)Mode will be full function.
(5)The data may be com-
pressed using EDRC (Mem-
o r e x ) o r I D R C ( I B M )
compression.
(6)Either EBCDIC or ASCII.
(c)A block must not exceed
32,600 tape positions and must
be a multiple of 200.
(d)Record length of 200 bytes.
(e)Labeled or unlabeled tape car-
tridges may be submitted.
.03Diskette specifications are as
follows:
(a)5
1
⁄4- or 3
1
⁄2-inches in diameter.
(b)ASCII recording mode only.
Additional specifications may
be found in Part B, Sec. 3, of
this revenue procedure.
(c)Record length of 200 bytes.
(d)Diskettes must be created
using the MS-DOS operating
system.
(e)Filename of IRSEOT must be
used. No other filenames are
acceptable. If a file will con-
sist of more than one diskette,
the filename IRSEOT will
contain a three-digit extension.
This extension will indicate
the sequence of the diskettes
within the file. For example,
the first diskette will be named
IRSEOT.001, the second dis-
kette will be named IR-
SEOT.002, etc.
(f)Delimiter character commas (,)
must not be used.
(g)Positions 199 and 200 of each
record have been reserved for
use as carriage return/line feed
(cr/lf) characters, if applicable.
.04Bisynchronous electronic specifi-
cations include:
(a)Transmitter must have Trans-
mitter Control Code number
(TCC).
(b)Access phone numbers :
4800 bps304-264-7080
9600 bps304-264-7040
14400 bps304-265-7045
(c)Data compression is en-
couraged.
*Note:See Part C, Bisynchronous
(Mainframe) Electronic Fil-
ing Specifications, for de-
tailed information on filing
with IRS/MCC via bi-
synchronous protocols.
.05IRP–BBS specifications include:
(a)Transmitter must have Trans-
mitter Control Code number
(TCC).
(b)IRP–BBS access phone num-
ber is 304-264-7070.
(c)Communications software set-
tings are:
—No parity
—Eight data bits
—One stop bit
—Full duplex
(d)Access speeds from 1200 to
28,800 bps.
( e )D a t a c o m p r e s s i o n i s
encouraged.
*Note: See Part D, IRP–BBS
Electronic Filing Specifica-
tions, for detailed informa-
tion on filing with IRS/
MCC via IRP/BBS.
Sec. 3. Record Layout
.01 Positions 6 through 174 of the
following record should contain infor-
mation about the payer for whom the
extension of time to file is being
requested. Do not enter transmitter
information in these fields. Only one
TCC may be present in a file.

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Record Layout
Field
PositionField TitleLengthDescription and Remarks
1–5Transmitter
Control Code
(TCC)
5Required. Enter the five digit Transmitter Control Code issued by IRS. Only
one TCC per file is acceptable.
6–14Payer TIN9Required. Must be the valid nine-digit EIN/SSN assigned to the payer. Do not
enter blanks, hyphens or alpha characters. All zeros, ones, twos, etc. will
have the effect of an incorrect TIN. For foreign entities that are not required to
have a TIN, this field may be blank; however, the Foreign Entity Indicator,
position 176, must be set to ‘‘X.’’
15–54Payer Name40Required. Enter the name of the payer whose TIN appears in positions 6-14.
Left justify information.
55–94Second Payer
Name
40If additional space is needed, this field may be used to continue name line
information (e.g., % First National Bank), otherwise, enter blanks.
95–134Payer Address40Required. Enter the payer’s address. Street address should include number,
street, apartment or suite number (or P.O. Box if mail is not delivered to a street
address).
135–163Payer City29Required. Enter payer city, town, or post office.
164–165Payer State2Required. Enter payer valid U.S. Postal Service state abbreviation (refer to Part
A, Sec. 18).
166–174Payer ZIP Code9Required. Enter payer ZIP code. If using a five-digit ZIP code, left justify
information and fill unused positions with blanks.
175Document
Indicator (See
Note)
1Required. Enter the document you are requesting an extension of time for using
the following code:
CodeDocument
1W–2
21098, 1099–A, 1099–B, 1099–C, 1099–DIV, 1099–G, 1099–INT, 1099–
MISC, 1099–OID, 1099–PATR, 1099–R, 1099–S, or W–2G
35498
41042–S
5REMIC Documents (1099–INT or 1099– OID)
*Note:Do not enter any other values in this field. Submit a separate record for each document. For example, if
you are requesting an extension for 1099–INT and 5498 for the same payer, submit one record with ‘‘2’’
coded in this field and another record with ‘‘3’’ coded in this field. If you are requesting an extension for
1099–DIV and 1099–MISC for the same payer, submit one record with ‘‘2’’ coded in this field.
176Foreign Entity
Indicator
1Enter character ‘‘X’’ if Indicator the payer is a foreign entity.
177–198Blank22Enter blanks.
199–200Blank2Enter blanks. Diskette filers may code the ASCII carriage return/line feed (cr/
lf) characters.
Extension of Time Record Layout
Transmitter
Control
Code
Payer
EIN
Payer
Name
Second
Payer
Name
Payer
Address
Payer
City
1–56–1415–5455–9495–134135–163

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70
Payer
State
Payer
Zip
Code
Document
Indicator
Foreign Entity
Indicator
Blank
164–165166–174175176177–198
Blank
or
CR/LF
199–200
Part F. Miscellaneous Information
Sec. 1. Addresses for Martinsburg Computing Center
To submit an application to file, waiver request (forms), correspondence, and magnetic media files, use the following:
Mailing by U. S. Postal Service: )
IRS—Martinsburg Computing Center
P. O. Box 1359, MS-360
Martinsburg, WV 25401-1359
Shipping by truck or air freight: (
IRS—Martinsburg Computing Center
Information Reporting Program
Route 9 and Needy Road, MS-360
Martinsburg, WV 25401
To submit a magnetically filed extension of time request, use the following:
Mailing by U.S. Postal Service: )
IRS—Martinsburg Computing Center
ATTN: Extension of Time Coordinator
P. O. Box 879, MS-360
Kearneysville, WV 25430
Shipping by truck or air freight: (
IRS—Martinsburg Computing Center
ATTN: Extension of Time Coordinator
Route 9 and Needy Road, MS-360
Martinsburg, WV 25401
Sec. 2. Telephone Numbers for Contacting IRS/MCC
=
Phone Numbers for
Contacting the Martinsburg Computing Center
Information Reporting Program Call Site:
?
304-263-8700
Between 8:30 a.m. and 4:30 p.m. Eastern Time
304-267-3367
Telecommunication Device for the Deaf (TDD)
Information Returns FAX Machine:
304-264-5602

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71
Electronic Filing:
(IRP–BBS)
(Asynchronous)
304-264-7070
Mainframe Filing—(Bisynchronous Filing)
4.8 Modems 304-264-7080
9.6 Modems 304-264-7040
14.4 Modems 304-264-7045
HOURS OF OPERATION—
24 HOURS A DAY
7 DAYS A WEEK
Sec. 3 Preparation Instructions for Media Label
Media label, Form 5064, has been obsoleted. It is no longer necessary to use special labels from IRS for your media. Any
pressure sensitive label can now be used as long as it contains the following information:
Type of filing: Indicate whether data is Original, Replacement, Test or Correction.
Tax Year: Indicate tax year for which media is submitted.
IRS TCC: (Transmitter Control Code): Provide TCC assigned to the transmitter. (See Part A, Section 7.)
Transmitter’s name
Operating system/Hardware:Recommended label format:
For 5
1
⁄4- and 3
1
⁄2-inch diskette files,Type of filing
indicate the type of personal computerTax YearIRS TCC
operating system, and software packageTransmitter name
used to create the media (for example:Operating system/Hardware
IBM.PC/AT-MSD/DOS, Apple MacIntosh/Number of payees
MacWrite V2.2).Transmitter number for media
Media sequenceof
For tape, indicate either EBCDIC or ASCII.
For tape cartridge, indicate operating system, either EBCDIC or ASCII, and either 18- or 36-track.
For 8mm tape cartridge, indicate operating system, and either EBCDIC or ASCII.
Number of payees: Indicate the total number of Payee ‘‘B’’ Records, Recipient ‘‘Q’’ Records for
Form 1042S, or total number of establishments for Form 8027 reported on the media.
Transmitter number for media: If available, provide the in-house number assigned by your organization to the tapes, tape
cartridges or diskettes.
Media sequence: Indicate sequence number of media and total number of media in file (for example: Media sequence 1 of
3, 2 of 3, 3 of 3).
Please affix external label to appropriate area on magnetic media. Do not hinder the ability to process media when
affixing label.
This is the end of Publication 1220 for Tax Year 1996.

SEQ 0023 JOB IRS27-024-004 PAGE-0072 PT 4 PG 72
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721996 –26 I.R.B.
Part IV. Items of General Interest
Deletions from Cumulative List of
Organizations Contributions to Which
Are Deductible Under Section 170 of
the Code
Announcement 96–61
The names of organizations that no
longer qualify as organizations de-
scribed in section 170(c)(2) of the
Internal Revenue Code of 1986 are
listed below.
Generally, the Service will not dis-
allow deductions for contributions
made to a listed organization on or
before the date of announcement in the
Internal Revenue Bulletin that an orga-
nization no longer qualifies. However,
the Service is not precluded from
disallowing a deduction for any contri-
butions made after an organization
ceases to qualify under section
170(c)(2) if the organization has not
timely filed a suit for declaratory
judgment under section 7428 and if the
contributor (1) had knowledge of the
revocation of the ruling or determina-
tion letter, (2) was aware that such
revocation was imminent, or (3) was in
part responsible for or was aware of
the activities or omissions of the
organization that brought about this
revocation.
If on the other hand a suit for
declaratory judgment has been timely
filed, contributions from individuals
and organizations described in section
170(c)(2) that are otherwise allowable
will continue to be deductible. Protec-
tion under section 7428(c) would begin
on July 1, 1996, and would end on the
date the court first determines that
the organization is not described in
section 170(c)(2) as more particularly
set forth in section 7428(c)(1). For
individual contributors, the maximum
deduction protected is $1,000, with a
husband and wife treated as one
contributor. This benefit is not ex-
tended to any individual who was
responsible, in whole or in part, for the
acts or omissions of the organization
that were the basis for revocation.
American Society of Humanistic
Education (ASHE)
Maitland, FL
St. Albans 2700 Preservation and
Restoration Society
St. Albans, WV
Voices for Freedom
Alexandria, VA

SEQ 0024 JOB IRS27-050-005 PAGE-0073 ANN DISBARMENT
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73
Announcement of the Disbarment, Suspension, and Consent to Voluntary
Suspension of Attorneys, Certified Public Accountants, Enrolled Agents and
Enrolled Actuaries From Practice Before the Internal Revenue Service
Under 31 Code of Federal Regula-
tions, Part 10, an attorney, certified
public accountant, enrolled agent or en-
rolled actuary, in order to avoid the in-
stitution or conclusion of a proceeding
for his disbarment or suspension from
practice before the Internal Revenue
Service, may offer his consent to
suspension from such practice. The
Director of Practice, in his discretion,
may suspend an attorney, certified
public accountant, enrolled agent or
enrolled actuary in accordance with the
consent offered.
Attorneys, certified public account-
ants, enrolled agents and enrolled actu-
aries are prohibited in any Internal
Revenue Service matter from directly
or indirectly employing, accepting
assistance from, being employed by,
or sharing fees with, any practi-
tioner disbarred or suspended from
practice before the Internal Revenue
Service.
To enable attorneys, certified public
accountants, enrolled agents and en-
rolled actuaries to identify practitioners
under consent suspension from practice
before the Internal Revenue Service,
the Director of Practice will announce
in the Internal Revenue Bulletin the
names and addresses of practitioners
who have been suspended from such
practice, their designation as attor-
ney, certified public accountant, en-
rolled agent or enrolled actuary and
date or period of suspension. This an-
nouncement will appear in the weekly
Bulletin at the earliest practicable date
after such action and will continue to
appear in the weekly Bulletins for five
successive weeks or for as many weeks
as is practicable for each attorney,
certified public accountant, enrolled
agent or enrolled actuary so suspended
and will be consolidated and published
in the Cumulative Bulletin.
The following individuals have been
placed under consent suspension from
practice before the Internal Revenue
Service:
NameAddressDesignationDate of Suspension
Bruender, LawrenceLesueur, MNAttorneyIndefinite from April 18, 1996
Pallman, James J.New Haven, CTCPAApril 19, 1996 to October 18, 1996
Pribble Jr., William C.Minneapolis, MNAttorneyIndefinite from May 1, 1996
Pyburn, Richard E.Downers Grove, ILCPAMay 1, 1996 to October 31, 1997
Scalise, James J.New Britain, CTAttorneyMay 1, 1996 to July 31, 1996
Kieldaisch, Dale W.Manteno, ILCPAMay 1, 1996 to October 31, 1996
Ogorek, Charolotte F.Park Ridge, ILCPAMay 3, 1996 to July 2, 1996
Korman, Steven B.Mulford, CTCPAMay 3, 1996 to February 2, 1997
Myers, Donald L.Olney, MDCPAMay 7, 1996 to May 6, 1998
Sharrett, William R.Paradise, CAEnrolled AgentMay 8, 1996 to November 7, 1996
Cornwell, Douglas S.Norwalk, CTCPAMay 10, 1996 to November 9, 1996
Chang, Sun KunMcLean, VAEnrolled AgentMay 13, 1996 to July 12, 1996
Cariveau, StewartMinneapolis, MNCPAMay 30, 1996 to August 29, 1996
Carter, Gary E.Ashdown, ARCPAJune 1, 1996 to August 31, 1996
Underwood, Wendell L.Sedalia, MOCPAJune 1, 1996 to July 31, 1996
Candiloro, James A.Glastonbury, CTCPAJune 1, 1996 to November 30, 1996
Schwartz, Leonard J.Danbury, CTEnrolled AgentJune 1, 1996 to February 28 1997
Forrester, Donald F.Fairfield, OHCPAIndefinite from June 4, 1996
Shade, Stephen E.Clearwater, FLEnrolled AgentJune 8, 1996 to May 7, 1997
Woods, James G.Huntington, CTCPAJuly 1, 1996 to June 30, 1997
Grove, Michael J.Alliance, OHCPAJuly 1, 1996 to June 30, 1997
Jenkins, FrankMontgomery, ALCPAJuly 1, 1996 to December 31, 1996
Brewton III, George W.Greenville, MSCPAJuly 1, 1996 to September 30, 1996
Fischer, Randall E.Lombard, ILCPAJuly 1, 1996 to September 30, 1996
Rhoney, BrianWheaton, ILCPAJuly 1, 1996 to December 31, 1996
Devereux, Michael J.Florissant, MOCPAJuly 1, 1996 to March 31, 1997
Cranston, Robert S.Saugerties, NYCPAJuly 1, 1996 to December 31, 1996
Miller, Dwight W.Overland Pk, KSCPAJuly 1, 1996 to June 30, 1997
Beck, Clyde E.Salina, KSCPAJuly 1, 1996 to October 31, 1996
Seal, Ernest E.Cleveland, MSCPAAugust 1, 1996 to July 31, 1998
Dicker, Joseph W.Minneapolis, MNAttorneyAugust 1, 1996 to October 31, 1996

SEQ 0025 JOB IRS27-050-005 PAGE-0074 ANN DISBARMENT
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Under Section 330, Title 31 of the
United States Code, the Secretary of
the Treasury, after due notice and
opportunity for hearing, is authorized
to suspend or disbar from practice
before the Internal Revenue Service
any person who has violated the rules
and regulations governing the recogni-
tion of attorneys, certified public ac-
countants, enrolled agents or enrolled
actuaries to practice before the Internal
Revenue Service.
Attorneys, certified public account-
ants, enrolled agents, and enrolled
actuaries are prohibited in any Internal
Revenue Service matter from directly
or indirectly employing, accepting as-
sistance from, being employed by or
sharing fees with, any practitioner
disbarred or under suspension from
practice before the Internal Revenue
Service.
To enable attorneys, certified public
accountants, enrolled agents and
enrolled actuaries to identify such
disbarred or suspended practitioners,
the Director of Practice will announce
in the Internal Revenue Bulletin the
names and addresses of practitioners
who have been suspended from such
practice, their designation as attorney,
certified public accountant, enrolled
agent or enrolled actuary, and the date
of disbarment or period of suspension.
This announcement will appear in the
weekly Bulletin for five successive
weeks or as long as it is practicable for
each attorney, certified public account-
ant, enrolled agent or enrolled actuary
so suspended or disbarred and will be
consolidated and published in the
Cumulative Bulletin.
After due notice and opportunity
for hearing before an administrative
law judge, the following individuals
have been disbarred from further prac-
tice before the Internal Revenue
Service:
NameAddressDesignationEffective Date
Bushta, Patrick C.Sacramento, CACPAApril 18, 1996
Hart, Joel S.Beaumont, TXCPAApril 19, 1996
Riggs, Patricia A.Stockton, CAEnrolled AgentApril 19, 1996
Hammontree, Richard F.Ogunquit, MECPAApril 27, 1996
Otto, Judith M.Tucson, AZEnrolled AgentMay 18, 1996

SEQ 0026 JOB IRS27-051-003 PAGE-0075 TERMS
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75
Definition of Terms
Revenue rulings and revenue proce-
dures (hereinafter referred to as ‘‘rul-
ings’’) that have an effect on previous
rulings use the following defined terms
to describe the effect:
Amplified describes a situation where
no change is being made in a prior
published position, but the prior posi-
tion is being extended to apply to a
variation of the fact situation set forth
therein. Thus, if an earlier ruling held
that a principle applied to A, and the
new ruling holds that the same princi-
ple also applies to B, the earlier ruling
is amplified. (Compare with modified,
below).
Clarified is used in those instances
where the language in a prior ruling is
being made clear because the language
has caused, or may cause, some confu-
sion. It is not used where a position in
a prior ruling is being changed.
Distinguished describes a situation
where a ruling mentions a previously
published ruling and points out an
essential difference between them.
Modified is used where the substance
of a previously published position is
being changed. Thus, if a prior ruling
held that a principle applied to A but
not to B, and the new ruling holds that
it applies to both A and B, the prior
ruling is modified because it corrects a
published position. (Compare with am-
plified and clarified, above).
Obsoleted describes a previously
published ruling that is not considered
determinative with respect to future
transactions. This term is most com-
monly used in a ruling that lists
previously published rulings that are
obsoleted because of changes in law or
regulations. A ruling may also be
obsoleted because the substance has
been included in regulations subse-
quently adopted.
Revoked describes situations where
the position in the previously published
ruling is not correct and the correct
position is being stated in the new
ruling.
Superseded describes a situation
where the new ruling does nothing
more than restate the substance and
situation of a previously published
ruling (or rulings). Thus, the term is
used to republish under the 1986 Code
and regulations the same position pub-
lished under the 1939 Code and regula-
tions. The term is also used when it is
desired to republish in a single ruling a
series of situations, names, etc., that
were previously published over a
period of time in separate rulings.
If the new ruling does more than
restate the substance of a prior ruling, a
combination of terms is used. For
example, modified and superseded de-
scribes a situation where the substance
of a previously published ruling is
being changed in part and is continued
without change in part and it is desired
to restate the valid portion of the
previously published ruling in a new
ruling that is self contained. In this
case the previously published ruling is
first modified and then, as modified, is
superseded.
Supplemented is used in situations in
which a list, such as a list of the names
of countries, is published in a ruling
and that list is expanded by adding
further names in subsequent rulings.
After the original ruling has been
supplemented several times, a new
ruling may be published that includes
the list in the original ruling and the
additions, and supersedes all prior
rulings in the series.
Suspended is used in rare situations
to show that the previous published
rulings will not be applied pending
some future action such as the issuance
of new or amended regulations, the
outcome of cases in litigation, or the
outcome of a Service study.
Abbreviations
The following abbreviations in current use and
formerly used will appear in material published
in the Bulletin.
A—Individual.
Acq.—Acquiescence.
B—Individual.
BE—Beneficiary.
BK—Bank.
B.T.A.—Board of Tax Appeals.
C.—Individual.
C.B.—Cumulative Bulletin.
CFR—Code of Federal Regulations.
CI—City.
COOP—Cooperative.
Ct.D.—Court Decision.
CY—County.
D—Decedent.
DC—Dummy Corporation.
DE—Donee.
Del. Order—Delegation Order.
DISC—Domestic International Sales Corporation.
DR—Donor.
E—Estate.
EE—Employee.
E.O.—Executive Order.
ER—Employer.
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduciary.
FC—Foreign Country.
FICA—Federal Insurance Contribution Act.
FISC—Foreign International Sales Company.
FPH—Foreign Personal Holding Company.
F.R.—Federal Register.
FUTA—Federal Unemployment Tax Act.
FX—Foreign Corporation.
G.C.M.—Chief Counsel’s Memorandum.
GE—Grantee.
GP—General Partner.
GR—Grantor
IC—Insurance Company.
I.R.B.—Internal Revenue Bulletin.
LE—Lessee.
LP—Limited Partner.
LR—Lessor.
M—Minor.
Nonacq.—Nonacquiescence.
O—Organization.
P—Parent Corporation.
PHC—Personal Holding Company.
PO—Possession of the U.S.
PR—Partner.
PRS—Partnership.
PTE—Prohibited Transaction Exemption.
Pub. L.—Public Law.
REIT—Real Estate Investment Trust.
Rev. Proc.—Revenue Procedure.
Rev. Rul.—Revenue Ruling.
S—Subsidiary.
S.P.R.—Statements of Procedural Rules.
Stat.—Statutes at Large.
T—Target Corporation.
T.C.—Tax Court.
T.D.—Treasury Decision.
TFE—Transferee.
TFR—Transferor.
T.I.R.—Technical Information Release.
TP—Taxpayer.
TR—Trust.
TT—Trustee.
U.S.C.—United States Code.
X—Corporation.
Y—Corporation.
Z—Corporation.

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Numerical Finding List
1
—Continued
Bulletins 1996–1 through 1996–26
Revenue Rulings—Continued
96–2, 1996–2 I.R.B. 5
96–3, 1996–2 I.R.B. 14
96–6, 1996–2 I.R.B. 8
96–4, 1996–3 I.R.B. 16
96–5, 1996–3 I.R.B. 29
96–7, 1996–3 I.R.B. 12
96–8, 1996–4 I.R.B. 62
96–9, 1996–4 I.R.B. 5
96–10, 1996–4 I.R.B. 27
96–11, 1996–4 I.R.B. 28
96–12, 1996–9 I.R.B. 4
96–13, 1996–10 I.R.B. 19
96–14, 1996–6 I.R.B. 20
96–15, 1996–11 I.R.B. 9
96–16, 1996–11 I.R.B. 4
96–17, 1996–13 I.R.B. 5
96–18, 1996–13 I.R.B. 4
96–19, 1996–14 I.R.B. 24
96–20, 1996–15 I.R.B. 5
96–21, 1996–15 I.R.B. 7
96–22, 1996–15 I.R.B. 9
96–23, 1996–15 I.R.B. 11
96–24, 1996–19 I.R.B. 5
96–25, 1996–19 I.R.B. 4
96–26, 1996–21 I.R.B. 9
96–27, 1996–24 I.R.B. 9
96–28, 1996–24 I.R.B. 11
96–29, 1996–24 I.R.B. 5
96–30, 1996–24 I.R.B. 4
96–31, 1996–25 I.R.B. 4
96–32, 1996–25 I.R.B. 5
Treasury Decisions:
8630, 1996–3 I.R.B. 19
8631, 1996–3 I.R.B. 7
8632, 1996–4 I.R.B. 6
8633, 1996–4 I.R.B. 20
8634, 1996–3 I.R.B. 17
8635, 1996–3 I.R.B. 5
8636, 1996–4 I.R.B. 64
8637, 1996–4 I.R.B. 29
8638, 1996–5 I.R.B. 5
8639, 1996–5 I.R.B. 12
8640, 1996–2 I.R.B. 10
8641, 1996–6 I.R.B. 4
8642, 1996–7 I.R.B. 4
8643, 1996–11 I.R.B. 4
8644, 1996–7 I.R.B. 16
8645, 1996–8 I.R.B. 4
8646, 1996–8 I.R.B. 10
8647, 1996–9 I.R.B. 7
8648, 1996–10 I.R.B. 23
1
A cumulative list of all Revenue Rulings,
Revenue Procedures, Treasury Decisions, etc.,
published in Internal Revenue Bulletins 1995–
27 through 1995–52 will be found in Internal
Revenue Bulletin 1996–1, dated January 2,
1996.
Treasury Decisions—Continued
8649, 1996–9 I.R.B. 5
8650, 1996–10 I.R.B. 5
8651, 1996–11 I.R.B. 24
8652, 1996–11 I.R.B. 11
8653, 1996–12 I.R.B. 4
8654, 1996–11 I.R.B. 14
8655, 1996–12 I.R.B. 9
8656, 1996–13 I.R.B. 9
8657, 1996–14 I.R.B. 4
8658, 1996–14 I.R.B. 13
8659, 1996–16 I.R.B. 4
8660, 1996–17 I.R.B. 4
8661, 1996–17 I.R.B. 7
8662, 1996–23 I.R.B. 5
8663, 1996–23 I.R.B. 4
8664, 1996–20 I.R.B. 7
8665, 1996–21 I.R.B. 4
8666, 1996–26 I.R.B. 4
8667, 1996–20 I.R.B. 4
8668, 1996–22 I.R.B. 4
8669, 1996–23 I.R.B. 6
8670, 1996–24 I.R.B. 6
8671, 1996–26 I.R.B. 8
8672, 1996–26 I.R.B. 7

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Finding List of Current Action on
Previously Published Items
1
Bulletins 1996–1 through 1996–26
*Denotes entry since last publication
Delegation Orders:
232 (Rev. 1)
Superseded by
232 (Rev. 2), 1996–7 I.R.B. 49
236 (Rev. 1)
Superseded by
236 (Rev. 2), 1996–21 I.R.B. 7*
239
Amended by
239 (Rev. 1), 1996–7 I.R.B. 49
Revenue Procedures:
65–17
Modified by
96–14, 1996–3 I.R.B. 41
66–49
Modified by
96–15, 1996–3 I.R.B. 41
88–32
Obsoleted by
96–15, 1996–3 I.R.B. 41
88–33
Obsoleted by
96–15, 1996–3 I.R.B. 41
89–19
Superseded by
96–17, 1996–4 I.R.B. 69
89–48
Superseded in part by
96–17, 1996–4 I.R.B. 69
91–22
Modified by
96–1, 1996–1 I.R.B. 8
91–22
Amplified by
96–13, 1996–3 I.R.B. 31
91–23
Superseded by
96–13, 1996–3 I.R.B. 31
91–24
Superseded by
96–14, 1996–3 I.R.B. 41
91–26
Superseded by
96–13, 1996–3 I.R.B. 31
92–20
Modified by
96–1, 1996–1 I.R.B. 8
1
A cumulative finding list for previously
published items mentioned in Internal Revenue
Bulletins 1995–27 through 1995–52 will be
found in Internal Revenue Bulletin 1996–1, dated
January 2, 1996.
Revenue Procedures—Continued
96–31, 1996–20 I.R.B. 11
92–85
Modified by
96–1, 1996–1 I.R.B. 8
93–16
Superseded by
96–11, 1996–2 I.R.B. 18
93–46
Superseded in part by
96–17, 1996–4 I.R.B. 69
Superseded by
96–18, 1996–4 I.R.B. 73
94–16
Modified by
96–29, 1996–16 I.R.B. 24
94–18
Superseded in part by
96–17, 1996–4 I.R.B. 69
Superseded by
96–18, 1996–4 I.R.B. 73
94–59
Superseded in part by
96–17, 1996–4 I.R.B. 69
Superseded by
96–18, 1996–4 I.R.B. 73
94–62
Modified by
96–29, 1996–16 I.R.B. 24
94–77
Superseded by
96–28, 1996–14 I.R.B. 31
95–1
Superseded by
96–1, 1996–1 I.R.B. 8
95–2
Superseded by
96–2, 1996–1 I.R.B. 60
95–3
Superseded by
96–3, 1996–1 I.R.B. 82
95–4
Superseded by
96–4, 1996–1 I.R.B. 94
95–5
Superseded by
96–5, 1996–1 I.R.B. 129
95–6
Superseded by
96–6, 1996–1 I.R.B. 151
Revenue Procedures—Continued
95–66
Modified by
96–25, 1996–19 I.R.B. 4
95–7
Superseded by
96–7, 1996–1 I.R.B. 185
95–8
Superseded by
96–8, 1996–1 I.R.B. 187
95–13
Superseded by
96–20, 1996–4 I.R.B. 88
95–20
Superseded by
96–24, 1996–5 I.R.B. 28
95–50
Superseded by
96–3, 1996–1 I.R.B. 82
96–3
Amplified by
96–12, 1996–3 I.R.B. 30;
96–34, 1996–26 I.R.B. 14*
Revenue Rulings:
66–307
Obsoleted by
96–3, 1996–2 I.R.B. 14
72–437
Modified by
96–13, 1996–3 I.R.B. 31
78–294
Obsoleted by
8665, 1996–21 I.R.B. 4
80–80
Obsoleted by
96–3, 1996–2 I.R.B. 14
82–80
Modified by
96–14, 1996–3 I.R.B. 41
92–19
Supplemented in part
96–2, 1996–2 I.R.B. 5
92–75
Clarified by
96–13, 1996–3 I.R.B. 31
95–10
Supplemented and superseded by
96–4, 1996–3 I.R.B. 16
95–11
Supplemented and superseded by
96–5, 1996–3 I.R.B. 29
96–24
Modified and amplified by
96–24A, 1996–15 I.R.B. 12

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INDEX
Internal Revenue Bulletins 1996–1
Through 1996–26
For index of items published during
the last six months of 1995, see
I.R.B. 1996–1, dated January 2,
1996.
The abbreviation and number in pa-
rentheses following the index entry
refer to the specific item; numbers
in roman and italic type following the
parentheses refer to the Internal
Revenue Bulletin in which the item
may be found and the page number
on which it appears.
Key to Abbreviations:
RRRevenue Ruling
RPRevenue Procedure
TDTreasury Decision
CDCourt Decision
PLPublic Law
EOExecutive Order
DODelegation Order
TDOTreasury Department Order
TCTax Convention
SPRStatement of Procedural
Rules
PTEProhibited Transaction
Exemption
EMPLOYMENT TAXES
Backup withholding:
Substitute Form W–9 (RP 26) 8, 22
Forms, electronic filing, magnetic
media, Form 1042–S (RP 11) 2,
18; correction (Notice 20) 14, 30
Partial withdrawal of proposed regula-
tions INTL–52–86 (Notice 4) 4, 69
Proposed regulations:
26 CFR 31.3306(r)(2)–1, added;
FUTA taxation of amounts under
employee benefit plans (EE–55–
95) 12, 12
26 CFR 31.6302–1(h)(1)(ii)(A)(2),
added; 31.6302–1(h)(2), –(3), –(7)
and –(8), revised; federal tax
deposits by electronic funds trans-
fer (IA–03–94) 17, 12
26 CFR 31.9999–0, added; effective
date of temporary backup with-
holding regs (IA–33–95) 4, 99
26 CFR 301.6109–1, 301.7701–1, –1,
–3, –6, revised; 301.7701–4,
amended; 301.7701–7, removed;
simplification of entity classifica-
tion rules (PS–43–95) 24, 25
EMPLOYMENT TAXES—
Continued
Regulations:
2 6 C F R 3 1 . 3 4 0 2 ( r ) – 1 a d d e d ;
31.3402(r)–IT, removed; withhold-
ing on distributions of Indian
gaming profits to tribal members
(TD 8634) 3, 17
26 CFR 31.3406(g)–1(d), added; in-
formation reporting and backup
withholding (TD 8664) 20, 7
2 6 C F R 3 1 . 3 4 0 6 – 0 r e v i s e d ;
3 1 . 3 4 0 6 ( a ) – 1 — 3 1 . 3 4 0 6 ( i ) – 1 ,
31.6051–4, 31.6413(a)–3, added;
35a.9999.OT, 35a.3406–2, re-
moved; 301.6109–1, amended;
backup withholding statement
mailing requirements, and due dili-
gence (TD 8637) 4, 29
26 CFR 31.6011(a)–4(b), revised;
31.6011(a)–4T, removed; reporting
of nonpayroll withheld tax lia-
bilities (TD 8672) 26, 7
26 CFR 31.6051–1(d), 31.6071(a)–
1(a)(3), amended; 31.6051–2(c),
31.6081(a)–1(a)(3), 301.6011–
2(c)(4)(i), revised; time for fur-
nishing wage statements on termi-
nation of employer’s operations
(TD 8636) 4, 64; correction
(Notice 21) 14, 30
26 CFR 31.6302–IT(h)(1)(ii)(A)(2),
added; 31.6302–IT(h)(2), –(3),
–(7), –(8), revised; federal tax
deposits by electronic funds trans-
fer (TD 8661) 17, 7
26 CFR 33 and 38, removed; parts
declared obsolete (TD 8655) 12, 9
26 CFR 301.6109–1, amended gran-
tor trust reporting requirements
(TD 8633) 4, 20
26 CFR 301.7507–1, 301.7507–0,
amended; treatment of acquisition
of certain financial institutions
(TD 8641) 6, 4
26 CFR 301.7701–3, amended; cost
sharing arrangements (TD 8632) 4,
6
26 CFR 301.9100–7T, amended;
generation-skipping transfer tax
(TD 8644) 7, 16
Returns:
Information, electronic filing; Form
941 (RP 19) 4, 80
Magnetic tape reporting: Forms 940,
941, and 945 (RP 18) 4, 73
Reporting agents, Form 8655 (RP
17) 4, 69
ESTATE & GIFT TAXES
ADMINISTRATIVE
Proposed regulations:
26 CFR 301.6103(n)–1, amended;
disclosure of returns and return
information to procure property or
services for tax administration pur-
poses (DL–1–95) 6, 28
26 CFR 301.6109–1, 301.7701–1, –1,
–3, –6, revised; 301.7701–4,
amended; 301.7701–7, removed;
simplification of entity classifica-
tion rules (PS–43–95) 24, 25
Regulations:
26 CFR 20.2035–1; 26 CFR 23 and
24, 25.2517–1, removed; regula-
tions declared obsolete (TD 8655)
12, 9
26 CFR 301.6109–1, amended; gran-
tor trust reporting requirements
(TD 8633) 4, 20
26 CFR 301.6011–2(c)(4)(i), revised;
time for furnishing wage state-
ments on termination of em-
ployer’s operations (TD 8636) 4,
64
26 CFR 301.7507–1, 301.7507–0,
amended; treatment of acquisition
of certain financial institutions
(TD 8641) 6, 4
26 CFR 301.7701–3, amended; cost
sharing arrangements (TD 8632) 4,
6
26 CFR 301.9100–7T, amended;
generation-skipping transfer tax
(TD 8644) 7, 16
ESTATE TAXES
Annuities, valuation, terminally ill
measured life (RR 3) 1, 14
Regulations:
26 CFR 20.2035–1, removed; regula-
tions declared obsolete (TD 8655)
12, 9
26 CFR 20.7520–3, amended; ac-
turial tables exceptions (TD 8630)
3, 19
26 CFR Part 26, revised; 301.9100–
7T, amended; generation-skipping
transfer tax (TD 8644) 7, 16
Special use value; farms; interest rates
(RR 23) 15, 11
Tax conventions, competent authority
procedures (RP 13) 3, 31

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GIFT TAXES
Annuities, valuation, terminally ill
measured life (RR 3) 1, 14
Regulations:
26 CFR 25.2517–1, removed;
regulations declared obsolete (TD
8655) 12, 9
26 CFR 25.2522(c)–3, 25.7520–3
amended; actuarial tables
exceptions (TD 8630) 3, 19;
correction (Notice 22) 14, 30
26 CFR 25.2702–3, amended;
grantor trust reporting
requirements (TD 8633) 4, 20
26 CFR 25.2702–5, 25.2702–7,
amended; sale of residence from
qualified personal residence trust
(PS–4–96) 18, 5
Tax conventions, competent authority
procedures (RP 13) 3, 31
EXCISE TAXES
Proposed regulations:
26 CFR 48.4081–8; 48.4082–1, re-
vised; 41.4101–1, amended; gas-
oline and diesel fuel dye injection
systems (PS–6–95) 16, 27
26 CFR 48.4101–1(c), 48.4101–2T;
gasoline sale or removal and tax
bond requirements, withdrawn
(Notice 26) 18, 4
26 CFR 301.6103(n)–1, amended;
disclosure of returns and return
information to procure property or
services for tax administration pur-
poses (DL–1–95) 6, 28
Regulations:
26 CFR 48.4081–4, 48.4082–1, –2T,
48.4101–3T, –4T, 48.6427–8T,
–9T, removed; 48.4082–1, –2,
48.4101–1, –2, 48.6427–8, –9,
added; 48.4041–0T, removed;
48.4041–1, –2, –2T, removed;
48.4041–21, amended; 48.4041–
1 5 — 4 8 . 4 0 4 1 – 2 1 , t r a n s f e r r e d ;
48.4042–1, amended; 48.4064–
1(e)(2), amended; 48.4081–1, –2,
–3, revised; 48.4081–4, –5, –7,
amended; 48.4081–6, –8, revised;
48.4081–10T, –11T, –12T, re-
m o v e d ; 4 8 . 4 0 8 2 – 1 , r e v i s e d ;
48.4082–2T, –3T, –4T, 48.4083,
removed; 48.4082–2, –3, –4,
48.4083–1, added; 48.4101–2T,
–3, –3T, –4T, removed; 48.4102–
1, amended; 48.4221, removed;
48.4221–1, –2, –5, amended;
48.4221–8, –9, –10, –12, removed;
EXCISE TAXES—
Continued
Regulations—Continued
4 8 . 4 2 2 1 – 1 1 , r e d e s i g n a t e d ;
48.4222(a)–1, (b)–1, revised;
4 8 . 4 2 2 2 ( d ) – 1 , a m e n d e d ;
4 0 . 6 0 1 1 ( a ) – 1 ( b ) , a m e n d e d ;
40.6011(a)–3T, removed; Part 42,
removed; 48.6206–1, removed;
4 8 . 6 4 1 6 ( b ) ( 2 ) – 2 , a m e n d e d ;
48.6416(g)–1, removed; 48.6421–
3, amended; 48.6424–0—48.6424–
6, removed; 48.6427–3, –7,
amended; 48.6427–8, –9, added;
4 8 . 6 4 2 7 – 8 T , – 9 T , r e m o v e d ;
48.6675–1, removed; 48.6714–1,
added; gasoline and diesel fuel
registration requirements (TD
8659) 16, 4
26 CFR 301.7507–1, 301.7507–0,
amended; treatment of acquisition
of certain financial institutions
(TD 8641) 6, 4
26 CFR 301.9100–7T, amended;
generation-skipping transfer tax
(TD 8644) 7, 16
26 CFR 53.4941(d)–2, amended;
self-dealing for private foundations
(TD 8639) 5, 12
26 CFR 301.6011–2(c)(4)(i), revised;
time for furnishing wage state-
ments on termination of em-
ployer’s operations (TD 8636) 4,
64
26 CFR 301.6109–1, amended; gran-
tor trust reporting requirements
(TD 8633) 4, 20
26 CFR 301.7701–3, amended; cost
sharing arrangements (TD 8632) 4,
6
INCOME TAX
Administration:
Advance valuation of art (RP 15) 3,
41
Delegation of authority:
Authority of Taxpayer Ombuds-
man (DO 239 [Rev. 1]) 7, 49
Authority to modify or rescind
TAO (DO 232 [Rev. 2]) 7, 49
Unagreed issues, referral to Appeals
(RP 9) 2, 15
Annuities and pensions, valuation, ter-
minally ill measured life (RR 3) 2,
14
Application of appeals settlement to
coordinated examination program
taxpayers (D.O. 236 (Rev. 2)) 21, 7
INCOME TAX—Continued
Authority of exam case managers to
accept settlement offers and execute
closing agreements on ISP and
IFASP issues (D.O. 247) 21, 7
Automobiles:
Owners and lessees, limitations on
depreciation (RP 25) 8, 19
Books and records:
Imaging systems (Notice 10) 7, 47
Butyl benzyl phthalate determination
(Notice 28) 19, 7
Capital expenditures (Notice 7) 6, 22
Changes in computing depreciation or
amortization (RP 31) 20, 11
Checklist questionnaire (RP 30) 19, 8
Consolidated returns, single-entity elec-
tion (RP 21) 4, 96
Credit against tax:
Enpowerment zone employment, in-
tent to issue regulations (Notice 1)
3, 30
Differential earnings rate (Notice 15)
13, 19
Employee plans:
Administrative, COBRA premium is-
sues (RR 8) 4, 62
Closing agreements (RP 29) 16, 24
Determination letters (RP 6) 1, 51
Funding:
Full funding limitations, weighted
average interest rate, Dec. 1995
(Notice 2) 2, 15; Jan. 1996
(Notice 9) 6, 26; Feb. 1996
(Notice 11) 8, 19; March 1996
(Notice 16) 13, 20; April 1996
(Notice 24) 16, 23; May 1996
(Notice 32) 22, 7
Mortality tables (RR 7) 3, 12
Retirement Protection Act of 1994
(RR 20) 15, 5; (RR 21) 15, 7
Single sum distributions amounts,
cash balance plans (Notice 8) 6,
23
Estimate tax payments for individuals
(Notice 5) 6, 22
Estate and trusts:
Valuations, transfers to pooled in-
come funds (RR 1) 1, 7
Foreign insurance companies, domes-
tic asset/liability and investment
yield (RP 23) 5, 27
Forms:
Substitute Forms W–2 and W–3,
specifications (RP 24) 5, 28; (RP
24A) 15, 12
Fringe benefits aircraft valuation for-
mula (RR 25) 19, 4

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INCOME TAX—Continued
Insurance companies:
Life, interest rate tables (RR 2) 2, 5
Interest:
Investment:
Federal short-term, mid-term and
long-term rates, Jan. 1996 (RR
6) 2, 8; Feb. 1996 (RR 14) 6,
20; March 1996 (RR 15) 11, 9;
April 1996 (RR 19) 14, 24; May
1996 (RR 24) 19, 5; June 1996
(RR 27) 24, 9
Rates, underpayments and overpay-
ments (RR 17) 13, 5; (RR 28) 24,
11
Interest netting study (Notice 18) 14,
27
Inventories:
LIFO:
Price indexes, department stores,
Nov. 1995 (RR 9) 4, 5; Dec.
1995 (RR 12) 9, 4; Jan. 1996
(RR 18) 13, 4; Feb. 1996 (RR
22) 15, 9; March 1996 (RR 26)
21, 5; April 1996 (RR 31) 25, 4
Investment:
Inflation adjustment for 1996 (RR 4)
3, 16
Involuntary conversion of a residence;
deduction for qualified residence in-
terest (RR 32) 25, 5
Joint return study (Notice 19) 14, 28
Loans:
CPI adjustment for below market
loans—1996 (RR 5) 3, 29
S u b j e c t t o p r i n c i p a l - r e d u c t i o n
method of accounting and mark-to
market rules (Notice 23) 16, 23
Low-income housing credit:
Bond factor amounts Jan.–Mar. 1996
(RR 16) 11, 4
Tax credit (RR 27) 11, 27
Low-income housing guidelines (RP
32) 20, 14
Major disaster areas (RR 13) 10, 19
Mark to market, securities dealers
(Notice 12) 10, 29
Magnetic/electronic media filing pro-
gram; Form 1040NR (RP 35) 25, 8
Nonconventional source fuel credit
(Notice 29) 19, 7
Obsolete regulations (Notice 35) 25, 8
Operation Joint Endeavor tax relief
(Notice 34) 24, 15
Partnerships:
Charitable contribution of property
(RR 11) 4, 28
INCOME TAX—Continued
Partnerships—Continued
Sales between partners, basis (RR
10) 4, 27
Payments from Presidential Election
Campaign Fund (Notice 13) 10, 29
Per diem allowances (RP 28) 14, 31
Property (contributed or other) distribu-
tion; recognition of gain or loss by
contributing partner; correction
(Notice 17) 13, 20
Proposed regulations:
26 CFR 1.72–17A, amended: 1.72–
17A(d)(1), added; 1.72(p)–1,
added; loans to plan participants
(EE–106–82) 10, 31
26 CFR 1.125–3, added; effect of
Family and Medical Leave Act of
1993 on the operation of cafeteria
plans (EE–20–95) 5, 15
26 CFR 1.163–5, 1.165–12(c),
amended; 1.871–14, 1.1441–0,
added; 1.1441–1, revised; 1.1441–
3, –4, amended; 1.1441–4T, re-
moved; 1.1441–5, –6, –7, revised;
1.1441–8T, amended; 1.1441–9,
added; 1.1442–1, –2, revised;
1 . 1 4 4 2 – 3 , a d d e d ; 1 . 1 4 4 3 – 1 ,
amended; 1.1461–1, –2, revised;
1.1461–3, –4, removed; 1.1462–1,
a m e n d e d ; 1 . 4 6 3 – 1 , r e v i s e d ;
1.6041–1, –3, amended; 1.6041–4,
revised; 1.6041A–1, 1.6042–3,
1.6045–1, amended; 1.6049–4, re-
v i s e d ; 1 . 6 0 4 9 – 4 ( d ) ( 3 ) , – 5 ,
1 . 6 0 5 0 N – 1 , 3 1 . 3 4 0 1 ( a ) ( 6 ) – 1 ,
amended; 31.3406(d)–3, revised;
3 1 . 3 4 0 6 ( g ) – 1 ( e ) , a d d e d ;
3 1 . 3 4 0 6 ( h ) – 2 , 3 1 . 6 4 1 3 ( a ) – 3 ,
amended; 35a.9999–1—3A, –4T,
removed; 301.6109–1, 301.6114–1,
301.6402–3, amended; withholding
of tax under sections 1441 and
1442 on certain U.S. source in-
come paid to foreign persons
( I N T L – 6 2 – 9 0 ; I N T L – 3 2 – 9 3 ;
INTL–52–86; INTL–52–94) 19, 26
26 CFR 1.351–1(a)(3), 1.721–1(c),
added; treatment of underwriters in
sections 351 and 721 transactions
(TD 8665) 21, 4
26 CFR 1.367–9, added (INTL–9–
95) 5, 24
26 CFR 1.409–1(b)(2)(i), retirement
bonds withdrawn (EE–118–81) 11,
29
26 CFR 1.411(c)–1, amended; alloca-
tion of accrued benefits between
employer and employee contribu-
tions (EE–20–95) 5, 15
INCOME TAX—Continued
Proposed regulations—Continued
26 CFR 1.411(d)(6), added; future
benefit accrual (EE–34–95) 3, 49
26 CFR 1.501(c)(5)–1, amended;
requirements for tax-exempt orga-
nizations (EE–53–95) 5, 23
26 CFR 1.581–1, 1.761–1, revised;
1.581–1, amended; simplification
of entity classification rules (PS–
43–95) 24, 20
26 CFR 1.704–1, –4, 1.708–1,
amended; 1.743–1(d), 1.761–1(e),
added; 1.737–2(a), revised; termi-
nation of a partnership (PS–5–96)
25, 17
26 CFR 1.731–2, added; distribution
of marketable securities by a part-
nership (PS–2–95) 7, 50
26 CFR 1.863–0, added; 1.863–1, –2,
–3, revised; 1.863–4, amended;
1.863–5, removed; source of in-
come from sales of inventory and
natural resources produced in one
jurisdiction and sold in another
(INTL–3–95) 6, 29
26 CFR 1.882–5, 1.884–1, amended;
effectively connected income and
branch profits tax (INTL–54–95)
14, 39
2 6 C F R 1 . 1 2 5 4 – 0 , 1 . 1 2 5 4 – 4 ,
amended; treatment of gain from
disposition of interest in certain
natural resource recapture property
by S corporations (PS–7–89) 8, 24
26 CFR 1.6081–4(a), revised:
1.6081–4(d), added; automatic ex-
tension of time for filing individ-
ual tax returns (IA–41–93) 11, 29
26 CFR 1.6302–4, added; federal tax
deposits by electronic funds trans-
fer (IA–03–94) 17, 12
26 CFR 31.3121(v)(2)–1, –2, added;
FICA taxation amounts under
employee benefit plans (EE–142–
87) 12, 13
26 CFR 31.3306(r)(2)–1, added;
FUTA taxation amounts under
employee benefit plans (EE–55–
95) 12, 12
26 CFR 301.6651–1(c)(3), revised;
failure to file return or pay tax
(IA–41–93) 11, 29
26 CFR 301.6103(n)–1, amended;
disclosure of returns and return
information to procure property or
services for tax administration pur-
poses (DL–1–95) 6, 28
26 CFR 301.7811–1(d), –(h), re-
vised; authority to modify or re-
scind TAOs (GL–1–96) 21, 9

SEQ 0033 JOB IRS27-054-008 PAGE-0081 INDEX
REVISED 29JUL96 AT 22:41 BY LR DEPTH: 65.01 PICAS WIDTH 46 PICAS
COMPOSITE COLOR
778/20052/29JUL96/IRS27-054
81
INCOME TAX—Continued
Proposed regulations—Continued
Property (contributed or other) distribu-
tion; recognition of gain or loss by
contributing partner; correction
(Notice 17) 13, 20
Railroad retirement:
R a t e d e t e r m i n a t i o n , q u a r t e r l y
(January 1 and April 1, 1996) 26,
7
Regulations:
26 CFR 1.62–2(h)(1), 1.274–2,
amended; 1.132–5(s) and (t),
added; 1.274–1, revised; meals and
entertainment, club dues and
spousal travel expenses paid by
employer (TD 8666) 26, 4
26 CFR 1.162–27, added; dis-
allowance of deductions for
employee remuneration in excess
of $1,000,000 (TD 8650) 10, 5;
TD 8650 corrected (Notice 14) 12,
11
26 CFR 1.168(h)–1; 1.168(i)(2),
added; lease term tax-exempt use
property (TD 8667) 20, 4
26 CFR 1.305–3, –5, –7, amended;
distribution of stock and stock
rights (TD 8643) 11, 4
26 CFR 1.351–1, amended; transfers
to investment companies (TD
8663) 23, 4
26 CFR 1.367(a)–3T, amended; cer-
tain transfers of domestic stock or
securities by U.S. persons to for-
eign corporations (TD 8638) 5, 5
26 CFR 1.385–2(d), removed; 1.358–
6, 1.1032–2, 1.1502–30, added;
controlling corporation’s basis ad-
justment (TD 8648) 10, 23
26 CFR 1.401–12(n) redesignated
1.408–2(e); 1.401–12T, removed;
1.401(f)–1, 1.408–2, amended;
nonbank trustee net worth require-
ments (TD 8635) 3, 5
26 CFR 1.411(d)–6T, added; notice
of significant reduction in the rate
of future benefit accrual (TD
8631) 3, 7
26 CFR 1.469–0, 1.469–4, 1.469–11,
amended; 1.469–9, revised; rules
for certain rental real estate ac-
tivities (TD 8645) 8, 4
26 CFR 1.936–6, amended; deter-
mination of combined taxable in-
come under the profit split method
(TD 8669) 23, 6
INCOME TAX—Continued
Regulations—Continued
26 CFR 1.482–0, 301.7701–3,
amended; 1.482–7, added; 1.482–
7T, removed; section 482 cost
sharing arrangements (TD 8632) 4,
6
26 CFR 1.482–7, revised; cost shar-
ing regulations (TD 8670) 24, 6
26 CFR 1.508–1, 1.6033–2 amended;
exempt organization not required
to file annual returns, integrated
auxiliaries of churches (TD 8640)
2, 10
26 CFR 1.584–2, 1.584–4, amended;
diversification of common trust
funds (TD 8662) 23, 5
26 CFR 1.597–1—1.597–7, added;
301.7507–1, 301.7507–9, amended;
treatment of acquisition of certain
financial institutions (TD 8641) 6, 4
26 CFR 1.671–4, revised; 1.6012–3,
301.6109–1, amended; grantor
trust reporting requirements (TD
8633) 4, 20
2 6 C F R 1 . 6 7 1 – 4 , 1 . 6 7 7 ( a ) – 1 ,
amended; 301.7701–4(e), added;
environmental settlement funds
classification (TD 8668) 22, 4
26 CFR 1.704–4, 1.737–1 through
1.737–5, added; recognition of gain
or loss by contributing partner on
distribution of contributed property
or other property (TD 8642) 7, 4
26 CFR 1.861–8, amended; 1.861–17,
added; allocation and apportion-
ment of research and experimental
expenditures (TD 8646) 8, 10
26 CFR 1.861–9T, amended; 1.822–
0, added; 1.882–5, revised; interest
expense deduction of foreign cor-
porations (TD 8658) 14, 13
26 CFR 1.864–4, 1.871–12, 1.884–
0(b), amended; 1.884–1(d)(4),
1.884–2T(a)(5), 1.884–4(b)(1) and
(2), revised; 1.884–1(i)(4), 1.884–
2T(a)(6), 1.884–4(e)(1) and (2),
added; effectively connected in-
come and branch profits tax (TD
8657) 14, 4
26 CFR 1.936–6, amended; deter-
mination of combined taxable in-
come under the profit split method
(TD 8669) 23, 6
26 CFR 1.952–3, 1.957–1, corrected;
definition of a controlled foreign
corporation, foreign base company
income, and foreign personal hold-
ing company income of a con-
trolled foreign corporation (Notice
33) 22, 8
INCOME TAX—Continued
Regulations—Continued
26 CFR 1.1258–1, added; conversion
transactions (TD 8649) 9, 5
26 CFR 1.1301–1, 1.32–1, 1.103–12,
1.110–1, 1.114–1, 1.115–1, 1.116–
1, –2, 1.367(a)–7T, 1.383–1A,
–2A, –3A, 1.804–1, 1.805–1
through –8 and intermediate sec-
tions, 1.820–1, –2, –3, 1.824–1,
– 2 , – 3 , r e m o v e d ; 1 . 9 0 7 – 0 ,
amended; 1.907(e)(1), 1.907(a)–
0A, –1A, 1.907(b)–1A, –2A,
1.907(c)–1A, –2A, –3A, 1.907(d)–
1A, 1.907(e)–1A, 1.907(f)–1A,
1.995–7, 1301–0 through –3 and
intermediate sections, 1.1303–1,
1.1304–1 through –6 and inter-
mediate sections, removed; regula-
tions declared obsolete (TD 8655)
12, 9
26 CFR 1.1445–1, 1.1445–8(c)(2)(i),
revised; 1.1445–5, amended; with-
holding of tax on dispositions of
U.S. real property interests by
foreign persons (TD 8647) 9, 7
2 6 C F R 1 . 1 5 0 2 – 1 3 , r e v i s e d ;
1.267(f)–1(k), amended; 1.1502–
13(f)(6), added; 1.1502–13(g)(2)-
(i)(B), amended; consolidated
groups intercompany transactions
and related rules (TD 8660) 17, 4
26 CFR 1.6042–4, 1.6044–5, revised;
1.6049–6, 301.6109–1, amended;
1.6050N–1, added Backup with-
holding, statement mailing require-
ments and due diligence (TD
8637) 4, 29
26 CFR 1.6049–4, –5, –6, amended;
1.6049–8, added; information re-
porting and backup withholding
(TD 8664) 20, 7
26 CFR 1.6050I–0T, –2T, removed;
1.6050I–0, –2, added; cash report-
ing by court clerks (TD 8652) 11,
11
26 CFR 1.6050P–0, –1, added,
1.6050P–0T, –1T, removed; infor-
mation reporting for discharges of
indebtedness (TD 8654) 11, 14
26 CFR 1.6081–4, amended; 1.6081–
4T, added; automatic extension of
time for filing income tax returns
(TD 8651) 11, 24
26 CFR 1.6302–4T, added; federal
tax deposits by electronic funds
transfer (TD 8661) 17, 7
26 CFR 1.6662–0, –6T, removed;
1.6662.5T, revised; 1.6662–6,
added; imposition of accuracy-
related penalty (TD 8656) 13, 9

SEQ 0034 JOB IRS27-054-008 PAGE-0082 INDEX
REVISED 29JUL96 AT 22:41 BY LR DEPTH: 65.01 PICAS WIDTH 46 PICAS
COMPOSITE COLOR
778/20052/29JUL96/IRS27-054
82
INCOME TAX—Continued
Regulations—Continued
26 CFR 301.6109–1(a)(1)(b), (c) and
(d)(2), revised; 301.6109–1(d)(3), –(4),
added; 301.6109–1(f), (g), (h), revised;
taxpayer identifying numbers (TS
8671) 26, 8
26 CFR 301.6011–2(c)(4)(i), revised;
time for furnishing wage statements
upon termination of employer’s opera-
tions (TD 8636) 4, 64
26 CFR 301.6311–1, corrected; pay-
ment of tax by check or money order
(Notice 27) 18, 4
26 CFR 1.7520–3, amended; actu-
arial tables exceptions (TD 8630) 3, 19
26 CFR 301.6676–1, 301.7424–1,
removed; regulations declared obsolete
(TD 8655) 12, 9
26 CFR 301.9100–7T, amended;
generation-skipping transfer tax (TD
8644) 7, 16
Relief from filing Form 3115 for
501(c) orgs. (Notice 30) 20, 11
R e o r g a n i z a t i o n s u n d e r s e c t i o n
368(a)(1)(f); series of steps in overall
plan (RR 29) 24, 5
Returns:
Form 990, church affiliated organiza-
tions exempt from filing (RP 10)
2, 17
On-line service electronic filing pro-
gram; Form 1040 (RP 20) 4, 88
INCOME TAX—Continued
Regulations—Continued
Renewable electricity production credit:
1996 inflation adjustment factor and
reference prices (Notice 25) 17, 11
Rulings:
Areas in which advance rulings
willing to be issued:
Associate Chief Counsel (Domes-
tic), Associate Chief Counsel
(Employee Benefits and Exempt
Organizations) (RP 3) 1, 86
Associate Chief Counsel (Interna-
tional) (RP 7) 1, 185
Areas in which advance rulings will
not be issued (RP 12) 3, 30; (RP
34) 26, 14
Employee plans and exempt organi-
zations user fees correction (RP
8A) 9, 10
Letter rulings, determination letters,
and information letters, Associate
Chief Counsel (Domestic), Associ-
ate Chief Counsel (Employee Ben-
efits and Exempt Organizations),
Associate Chief Counsel (Enforce-
ment Litigation) and Associate
Chief Counsel (International) (RP
1) 1, 8
No-rule provision, combining trans-
actions (RP 22) 5, 27 (Notice 6) 5,
27
Tax-exempt bonds, issuance pro-
cedrues (RP 16) 3, 45
INCOME TAX—Continued
Rulings-Continued
Technical advice, employee plans
and exempt organizations (RP 5)
1, 129
Technical advice to the District
Directors and Chiefs, Appeals Of-
fices, from the Associate Chief
Counsel (Domestic), Associate
Chief Counsel (Employee Benefits
and Exempt Organizations), Asso-
ciate Chief Counsel (Enforcement
Litigation), and Associate Chief
Counsel (International) (RP 2) 1,
60
Rulings and determination letters, issu-
ance procedures (RP 4) 1, 94
Spin-off of subsidiary, followed by its
merger with unrelated corporation (RR
30) 24, 4
Tax conventions:
Competent authority procedure (RP
13) 3, 31
Relief in treaty cases (RP 14) 3, 41
U.S.-Canada income tax treaty, RRSPs
and RRIFs (Notice 31) 22, 7
User fees for employee plans and exempt
organizations (RP 8) 1, 187
Waiver Rev. Proc., section 911(d)(4) (RP
33) 22, 8