0160.000.00 THE IRS MATCH

The Internal Revenue Service (IRS) sends a monthly file and an annual file to the Family Support Division (FSD) that contains income reported to the IRS by a third party that is paid by the third party to individuals who are:

• Active on a Temporary Assistance (TA) case;
• Active on a Food Stamp case, even disqualified members;
• Active on a MO HealthNet adult case (i.e.: Supplemental Aid to the Blind (SAB), MO HealthNet for Aged, Blind, Disabled (MHABD), Supplemental Nursing Care (SNC), or Supplemental Payments (SP));
• NOTE:  Blind Pension (BP) cases are not included in the match.
• Active on a Refugee Resettlement case.

This is the income reported to IRS by banks, savings and loans, etc.  The unearned income reported by IRS in the monthly or annual match may be monthly income, a lump sum, or may indicate a resource which may affect eligibility.

IRS matches are generated in September every year. Matches are generated for new applicants the month following approval.

0160.005.00 HOW THE IRS MATCH IS ACCOMPLISHED

Family Support Division (FSD) sends a tape to the IRS listing all individuals to be matched.  IRS returns a tape to FSD containing unearned income information for the individuals.  FSD completes the match by deleting irrelevant data and loading the information into the system.

When FSD receives the tape, the information is recorded on the IIRS screen.

Eligibility specialists are informed that IRS matches are available on recipients in the following ways:

• For FAMIS Cases:

  If the IRS match is on a recipient active in FAMIS, an Alert is sent to the eligibility specialist and the supervisor. The eligibility specialist:

  • Selects the alert and presses F15=REVIEW;
  • On the Select Interface (FMK0) screen, select the row containing the IRS match notice; and
  • Press F6=DETAIL to flow to the IIRS screen.
• For Legacy Cases:

  If the IRS match is on a recipient inactive in FAMIS, the eligibility specialist and supervisor receive an e-mail notice that IRS information is available on the IIRS screen.

The eligibility specialist has 45 days from the date the match is generated to determine continuing eligibility or ineligibility for the case.

0160.010.00 FIELD ENTRY INSTRUCTIONS FOR THE IIRS SCREEN

This section gives instructions on the purpose and use of the IIRS screen and the information found on it.

Notices of any matches are sent to the eligibility specialist by alert or email.  If the individual is on a case in FAMIS, the eligibility specialist receives an alert. The alert reads as follows:  “#4026 IRS MATCH RECEIVED”.

The IIRS screen:

• Displays applicant and recipient unearned income information;
• Provides a field for the eligibility specialist to indicate that the information reported by IRS has already been verified in the case record; and
• Allows the eligibility specialist to request system generated IEV-06, IM-6 and IEV-80 letters to the applicant or recipient.

0160.010.05 Review The IRS Information On The IIRS Screen

Step 1. In Legacy:

• Type the tran-id IIRS, space, and the individual DCN.
• Press Enter.

The IIRS screen displays the following case information at the top of the screen:

• The individual’s DCN, name, SSN, and SSN verification code;
• The Legacy case number, case name and current case status for all the cases the individual is associated with; and
• The individual’s current status within each case.

The IIRS screen displays the following unearned income information reported by IRS at the bottom of the screen:

• The date the IRS information was loaded into the system:
• The individual’s SSN, name (payee) and address;  (on the left)
• The name of the source of the income (payer) and the payer’s address; (on the right)
• The tax year;
• The amount of income;
• The code for the type of income (IRS Income Code chart); and
• A description of the type of income.

Step 2.

• If only one type of income was reported a message “Inquiry Complete” displays at the bottom of the screen.

Step 3.

• If more than one type of income has been reported by IRS for the individual, a message “More Data Available” displays at the bottom of the screen.
• Press Enter to access the additional information.  The system continues to display the available information as Enter is pressed.  When all information has been accessed, the message “Inquiry Complete” displays at the bottom of the screen.
• Press Enter to return to the first page of the IIRS screen.

Step 4.

• The message “Do Not Print This Screen” displays at the bottom of each screen.  This is a reminder of the IRS security requirements.

DO NOT PRINT THIS SCREEN.

Step 5

• To indicate that the unearned income reported has already been verified in the case record:
  • After viewing unearned income information and comparing it to information in the case record, type X in the verify field above the payee’s SSN if the information is already known to the case.
  • Press Enter.
• The IIRS screen displays the current date in the Date field after the Enter key is pressed.
  • If the verify indicator (X) is entered in error, type a zero over the X to erase the indicator.

0160.015.00 GENERATING THE IEV-06 AND IEV-80

When income reported on the IIRS screen is not known or included in the case record, request a system-generated IEV-06 (The IEV-06 is a form telling the recipient that income has been reported to the Family Support Division (FSD))and the Authorization for Release of Information (IM-6) letter(s).

0160.015.05 Request A System-Generated IEV-06 and IM-6 letter(s)

Step 1.

• After viewing all available unearned income information, use the first IIRS screen to request system generated IEV-06/IM-6 letters.

Step 2.

• Type 6 in the space(s) to the left of the case ID for each case needing an IEV-06/IM-6 letter.  The IEV-06 letter contains each type of assistance selected.

  The IIRS screen displays the date the IEV-06/IM-6 letter was requested at the right of the screen following the individual status after the Enter key is pressed.

Step 3.

• A second page listing all incomes for the individual displays.  This page lists the individual’s DCN, name, SSN, and SSN verification code at the top.  All sources of income are then listed showing the income source (payer), tax year, amount, and type for each source.

Step 4.

• Enter the pay county number and load number to be printed on the IEV-06 and IM-6 letters.  The system uses the FAMIS data base to obtain the eligibility specialist’s name and telephone number.  If the pay county and load number entered are not valid, an on-line edit “Invalid Pay County or Load Number” displays at the bottom of the screen after the incomes are selected and Enter is pressed.

Step 5.

• Select the unearned income(s) to be printed on the IEV-06/IM-6 letters by typing X in the space to the left of the payer’s name.  Even if only one payer is listed, it is necessary to type the X in order to generate the letters.

• Press Enter.

  The system generates and sends one IEV-06 letter listing all the types of assistance and all the unearned incomes selected.  Along with the IEV-06, the system generates a separate IM-6 letter for each type of unearned income selected.  A return envelope is included for the recipient to return the completed IM-6 letter(s).

  There is a maximum of three unearned incomes per IEV-06/IM-6 letters.  If more than three unearned income types are selected, the system sends additional IEV-06/IM-6 letters.

  Only nine unearned incomes may be selected per transaction.  If it is necessary to request IEV-06/IM-6 letters for more than nine unearned incomes, select the first nine, then in a separate transaction, request the next nine until all incomes have been selected.

Copies of the IEV-06 letter and the IM-6 letters are sent to the eligibility specialist for tracking purposes.   Copies are received in a brown envelope marked confidential and are sent through state mail.  Upon receiving the copies of the IEV-06 and IM-6’s, they must be logged on the IRS Notice Log with the date of receipt, client’s DCN and type of letter received.  The log must be kept in a locked cabinet.

DO NOT FILE THESE LETTERS IN THE CASE RECORD.  THIS INFORMATION IS CONFIDENTIAL AND MUST BE MAINTAINED UNDER LOCK AND KEY AND DESTROYED WHEN THE RECIPIENT RETURNS THE REQUESTED INFORMATION.

When the IM-6 is returned by the client, staff must log the date of return on the IRS Notice Log. When the IM-6 is destroyed, staff must also log the date and method of destruction on the IRS Notice Log.

If the recipient does not return the requested information, use the IRS Notice Log to document the date the information was requested and the date the IEV-80 was generated.

0160.015.10 Request A System-Generated Adverse Action Notice (IEV-80)

If the client does not respond to the IEV-06, use the IIRS screen to request a system generated IEV-80 for the appropriate type of assistance.

Step 1

• Type 80 in the spaces to the left of the case ID for each case you are requesting an IEV-80.  Press Enter.  The IEV-80 contains each type of IEV-06 assistance selected.

  The IIRS screen displays the date the IEV-80 was requested at the right of the screen after the individual status after the Enter key is pressed.

  It is not necessary to select a type of unearned income for the IEV-80.

Step 2

• Enter the pay county number and load number to be printed on the IEV-80 letter.  The system uses the FAMIS data base to obtain the eligibility specialist’s name and telephone number.  If the pay county and load number entered are not valid, an on-line edit “Invalid Pay County or Load Number” displays at the bottom of the screen after the incomes are selected and Enter is pressed.

  The system uses the current pay county and load number in the IMU5/FSU5 systems and obtains the worker name and telephone number from IWKR.  If the pay county and load number in IMU5/FSU5 systems are not valid pay county and load numbers in IWKR, the County Manager name and telephone number is printed on the IEV-80.  The system generates and sends an IEV-80 listing all the types of assistance selected.  Only one IEV-80 is sent for all cases selected.  The closing reason given on the IEV-80 is “you did not cooperate in providing information requested of you regarding your unearned income (7CFR 273.2 (f) (9) and/ or 45DFR 205.56).”

  A copy of the IEV-80 is sent to the eligibility specialist for tracking purposes and closing action.  The IEV-80 does not contain confidential IRS information and may be filed in the case record.

Step 3

• THE SYSTEM WILL NOT CLOSE THE CASE WHEN THE 10 DAYS EXPIRE.  The eligibility specialist must close the case.  Follow instructions for Worker Initiated Closing found in the FAMIS User Guide.  Enter Action code “WICL” (worker initiated closing) and Reason code “COO” (failed to cooperate).

NOTE:   An IEV-06 and an IEV-80 cannot be requested at the same time in the same transaction on the IIRS screen.

0165.000.00 SAFEGUARD REQUIREMENTS FOR IRS INFORMATION

This section discusses the Income Eligibility Verification System (IEVS) matches with the Internal Revenue Service (IRS).  Through this system, the Family Support Division (FSD) matches tapes with IRS to obtain unearned income information reported to IRS by a third party, such as a bank or savings and loan.  FSD obtains information on applicants (payees and heads of households) and recipients for all FSD programs.  The information is used to:

• Verify eligibility;
• Verify proper benefits;
• Investigate possible overpayments and over issuances; and
• Obtain information for criminal or civil prosecution.

Any information reported by the IRS is not verified.  This information must be verified by a third party.  When verifying IRS information, you cannot indicate this information was received from the IRS, or connect the information to the IRS in any way.

All information reported by IRS is considered confidential.  Access to federal tax information (FTI) must be strictly on a “need to know” basis.  Copies of screens and letters containing information on unearned income reported by IRS may not be maintained in case records or shared with anyone except:

• the client;
• the client’s representative as authorized by the client;
• the employees who are  responsible for maintaining the locked file of IEV-06 and IM-6 forms;
• the Hearing Officer;
• the quality control analyst; and
• the third party that reported income.

When the IRS data is verified by a third party, the verification must be recorded in FAMIS and the case record.  Once the third party verification is received, normal confidentiality rules apply as the information is now normal case information, not IRS information and must not be identified as IRS information in any way.

• Program Managers and County Managers have an ongoing responsibility for ensuring all staff is knowledgeable about IRS security requirements and that the security provisions are enforced.
• FSD staff is prohibited from releasing certain types of confidential information under any circumstances.
• Federal regulations require FSD to develop safeguarding procedures for proper storage and the destruction of confidential data.
• Any office that requests and receives IRS confidential information is responsible for securing that information.
• The office must store IRS confidential information in a designated area that is restricted to authorized personnel only.

• FSD staff must keep IRS confidential documents in this area and stored in a locked container when not in use.  The key/combination to the container must be kept by the individual in charge of the files or locked in a safe place.
• IRS confidential material and the key/combination to the storage area must never be left in open view.
• Access to file keys or safe combinations must be limited to the office manager or his/her designee and a maximum of two alternates.
• After the eligibility specialist looks at the information, the designated personnel must safeguard it until it is destroyed.

0165.005.00 DESTRUCTION OF FEDERAL TAX INFORMATION

When destroying federal tax information (FTI), you must take the following actions:

1. Complete the IRS Notice Log for destruction of IRS material showing:
   • The date the document was received;
   • The individual to whom the information was given;
   • The destruction date; and
   • Method of destruction.
2. Destroy the copies of the IEV-06 letters after the Authorization for Release of Information (IM-6) signed by the applicant or participant is sent with the verification request.  Upon return of the IM-6 by the applicant or participant, enter the date returned on the IRS Notice Log. When the verification is received back in the FSD office, destroy any attached IM-6 produced as a result of an IRS match. Upon destruction of the IM-6 enter the date and method of destruction on the IRS Notice Log.
3. Destroy all FTI information locally (i.e.: in the office);

   Approved methods of destruction are:

   • Burning, mulching, pulping, shredding, or disintegrating.

   The following precautions should be observed when destroying FTI:

   • Burning precautions: the material is to be burned in either an incinerator that produces enough heat to burn the entire bundle or the bundle should be separated to ensure that all pages are consumed.
   • Shredding precautions: to make reconstruction more difficult, the paper should be inserted so that lines of print are perpendicular to the cutting line. The paper should be shredded to effect 5/16 inch wide or smaller strips. If shredding is part of the overall destruction of FTI, strips can in effect be set at the industry standard (currently ½”). However, when deviating from IRS’ 5/16” requirement, FTI as long as it is in this condition (i.e., strips larger than 5/16”), must be safeguarded until it reaches the stage where it is rendered unreadable.
   • Pulping of data should be accomplished only after material has been shredded.
   • If the office uses a shredding contract and disposes of FTI in this manner, the office must maintain FTI in the locked file cabinet until the shredding contractor arrives on site.  At that time, a designated staff person must retrieve the FTI and place it in the shredding bin.  The designated staff person must then observe the shredding of the data contained in that bin.  Upon completion of the shredding, the date must be entered in the IRS Notice log.

     NOTE:  Hand tearing, recycling, or burning information in a landfill are unacceptable methods of disposal.

FSD employees must take a training course on the Electronic Learning Center (ELC) at the time of hire and annually thereafter to ensure they are aware of federal regulations governing the handling of IRS confidential information.

0165.010.00 INTERNAL INSPECTIONS REPORT FOR IRS

The Family Support Division (FSD) must perform annual internal audits of Internal Revenue Service (IRS) safeguard procedures at each of FSD field office.  Each office must complete the Internal Inspections Report/Field Office.  The report must be completed each year in June and received by Central Office by the 30th of June.

FSD must complete the internal inspection to be in compliance with the IRS Safeguard procedures.

The Internal Inspections Report/Field Office and instructions for completion are found in the IM Forms Manual Volume 2.