TN 43 (04-16)

GN 00502.118 Verifying and Updating EINs for Organizational Payees

A. Background

The Internal Revenue Service (IRS) assigns an Employer Identification Number (EIN) to identify a business entity for tax reporting purposes. Because of varying conventions in tax reporting practices, in some large organizations, (notably some state governmental entities); one EIN is used by all components of the organization. Thus, separate state institutions may use the same EIN. Conversely, some large organizations have been assigned several EINs, one for each part of the organization.

This section describes how field office management identify and process organizational EIN issues in eRPS.

IMPORTANT: Field office management must establish, update, and terminate organizational payee records. Claims representatives (CR’s) should not take actions establishing, updating, or terminating organizational payee records.

B. Policy for EIN Verification

An organizational applicant or payee is an entity serving or applying as payee as the agent representative or official of an institution

The law requires you to verify an organizational applicant/payee's EIN.

C. Process for EIN Verification

1. Federal, State, and Local Government Entities

Since each governmental entity has its own conventions for reporting taxes, you will see variations in the level at which EINs are assigned. Use your judgment and any knowledge you may have about a particular organization's conventions to verify the EIN.

  1. If one EIN is used by every component in a state or county (or other local government body) and the applicant's organization is not the name shown on the Employment Identification File (EIF), make sure the entity shown on the EIF is from the same geographical area as the organization applying to be payee. Tell the applicant that the EIN he or she provided is not assigned to his or her organization. If the applicant is persuasive in the explanation (e.g., “All state facilities use that number.”), consider the EIN verified. For cases where you are not satisfied by the explanation, do an EIF search using the DEQY or AEQY to check on other names.

    REMEMBER: The EIF does not list the names of all the entities properly assigned for each EIN.

  2. If a unique EIN is used by the organization, the EIF should reflect that organization's name. Verify that the EIN does belong to that institution if there is a discrepancy. If you are aware that the organization has changed names and are confident that the organization shown on the EIF is the same as the applicant, consider the EIN verified. If, however, you are not certain that the organization shown on the EIF is the same as the applicant, ask the applicant to provide documentation showing that this is indeed its EIN.

    NOTE: Acceptable documentation includes correspondence from IRS showing the EIN or legal documents relating to the name change.

  3. If several EINs are used by one institution, consider the EIN verified if the EIF shows the name of the institution as part of the name. If there is a discrepancy, obtain documentation of the EIN (see GN 00502.118D.1.b. in this section).

2. Private Entities

Private (non-governmental) entities are more likely to have a unique EIN assigned.

In those instances where a single entity uses the EIN of a parent or corporate organization, verify the EIN under the same general guidelines as verification for governmental entities' EINs (see GN 00502.118D.1.a. in this section).

Otherwise, the name shown on the EIF should be the same as the name given by the applicant. Obtain documentation that shows the EIN belongs to the applicant, if there is any discrepancy (see GN 00502.118D.1.b. in this section).

D. Procedure for Verifying EIN for an Organizational Payee in eRPS

When initially establishing an organizational payee in eRPS:

  1. Select “Establish Organization” under Manager Actions on the eRPS Home Screen (MS INTRANETERPS 001.002);

  2. Input the Organizations information on the Establish Organization/Institution screen (MS INTRANETERPS 014.002);

  3. Click on the “Verify EIN” tab.

After you click on “Verify EIN”, the EIF searches to identify the entered EIN. The EIN is displayed on the EIN Info from EIF screen (MS INTRANETERPS 014.003). Even though more than one name can be used by the entity assigned an EIN, the eRPS displays only the most recent name entry made for that EIN.

1. EIN found on EIF

When you input the EIN, the eRPS will check the EIF and verify a match. If the EIN is found on the EIF file the system will ask you the following:

Is the EIN correct for this organization?

If you select YES, the EIN is verified and you should continuing processing.

If you select NO, eRPS creates an EINVER issue with a 5-day tickle. You must correct the EIN. Once the EIN is corrected, the EINVER will be closed with the current date.

2. EIN Assigned But Not on EIF (OVERRIDE FUNCTION)

If the EIN does not appear on the EIF, you will see an error message “EIN NIF on EIF database”. If the applicant submits proof that the EIN is assigned to the applicant (e.g., IRS documentation), eRPS will allow you override and establish the EIN. If the override does not occur and the EIN is not verified in EIF, an issue will be generated by the system. The system asks:

Do you still want to use this EIN?

If you select YES, the system will ask to select one of the following as “Proof Type”

  • EIF

  • Federal, State, and Local government entities

  • Private entities

  • EIN assigned but not in EIF

  • Other

If Proof type of “Other” is selected, then user must enter description in Other text box

3. Procedure for EIN correction or change.

If an organization’s EIN changes, FO management can select the option to correct the EIN. You must input the new EIN or re-verify the current EIN against the EIF.

  • Go to “Manage Organization” under Manager Actions from the eRPS Home screen (MS INTRANETERPS 001.002);

  • Search the Organization by zip code, name, or State on the Organization Payee Search screen (MS INTRANETERPS 007.004);

  • Select the Organization and click on the “Update Organization” on the Organizational Payee Search Results screen (MS INTRANETERPS 007.001);

  • Under the Case Details, select the Organization data;

  • On the EIN Info from EIF screen (MS INTRANETERPS 014.003), enter the new EIN and select “Update EIN”;

  • If the EIN is correct, select yes to “Is the EIN correct for this organization?”

E. Applications Processed Outside the eRPS

If for any reason (other than no EIN on the EIF) the case cannot be processed via the eRPS, obtain a DEQY or AEQY to verify the EIN.

F. Example

Camarillo State Hospital files to be payee for John Doe alleging an EIN of xx-xxxxxxxx. The EIF query for that EIN shows:

State Controller State of Calif
Division of Unclaimed Property
PO Box 842850
Sacramento CA 94250-0001

You question whether this EIN is correct, since it shows the Division of Unclaimed Property. You tell the applicant that the number is shown as belonging to another entity and ask for an explanation. The applicant explains that every California governmental entity uses that EIN. Since the applicant's explanation is plausible, you decide the EIN is verified.

G. References

EIN Information from EIF screen, MS INTRANETERPS 014.003

Merge Organization/Institution screen MS INTRANETERPS 014.005

Using the DEQY to verify EIN, MSOM QUERIES 003.005.

Using the AEQY to search EIF, MSOM QUERIES 005.004.

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GN 00502.118 - Verifying and Updating EINs for Organizational Payees - 04/15/2016
Batch run: 04/15/2016