TN 13 (08-10)

RS 01804.165 Establishing Unposted Prelag SEI-Tax Returns Destroyed by IRS

A. Background

The IRS tax return disposal program calls for the destruction of returns 7 years after the year of filing. See RS 01804.410D.2. and RS 01804.410D.3. for a discussion of Retention and Availability of Tax Information.

B. Policy

The absence of an entry on an earnings record for a year for which the tax return was destroyed is strong evidence that the individual did not report SEI for that year.

However, this must be developed in accordance with RS 01804.165C in this section if:

  • The SEI cannot be established per RS 01804.150;

  • The claimant maintains SEI was reported for that year; and

  • The alleged SEI would affect insured status or increase the PIA by $1.00 or more.

C. Procedure

Proceed as follows if the individual presents a copy of the tax return but does not have proof of filing.

1. Tax return available/no proof of timely filing

  • Determine if the tax return was filed within the time limitation. Consider the following: The appearance of the taxpayer’s tax return, the date of the tax form, and the date of preparation. Does it appear to be authentic?

  • Does the Form W-2 or evidence of estimated tax payments indicate the filing of a timely tax return?

  • Is there consistency in the reportings? Do the posted earnings indicate that returns reporting SEI were filed for other years when required?

  • Was the Schedule SE completed incorrectly or does it contain pertinent omissions such as name or SSN?

  • Is there a statement from the claimant's accountant or tax preparer as to the authenticity?

Credit the SEI if all the evidence establishes that a timely tax return was filed.

If the claimant submits a tax return that appears to be authentic but the evidence is insufficient to establish that it was timely filed and the claimant still contends that it was filed timely, contact the designated IRS Disclosure Office based on the State where the taxpayer (TP) currently resides. See RS 01804.400B.4. for a list of IRS Disclosure Offices by State.

NOTE: IRS can provide “Tax Return Transcripts” reflecting information extracted from Schedules C, CEZ, E, F or SE and other schedules where self-employment income or SECA tax is reported on Forms 1040 for the current and three previous years rather quickly. IRS cannot provide an actual copy of a “tax return” beyond the seven most recent years. Further, IRS cannot retrieve information extracted from Forms 1099 or W-2’s beyond the 10 most recent years. See RS 01804.410D.3., Information Returns (Forms 1099).

2. IRS contact procedures

Request tax return information as provided in RS 01804.400. Ensure that the IRS Request Form (click on PDF file in RS 01804.400C to view or print a copy of the IRS Request Form) used to request the tax information is complete and correct; i.e. it provides all of the information requested about the taxpayer (e.g. names as shown on tax return, TP’s SSN(s), types of Schedules requested (e.g. Schedule C, F, SE, etc.), Fact of Filing Date(s) (i.e. the approximate date the tax return was filed if known and the tax periods involved, etc.) to assist IRS in locating the tax records. IRS will return the request for tax information to SSA if the required information is not provided.

If IRS confirms that a timely tax return was filed, credit the amount of SEI shown on the tax return submitted by the claimant.

If IRS advises that a timely tax return was not filed, do not credit the SEI.

If IRS has no record of a return, submit the case as indicated in RS 01804.165C.3. in this section.

3. No copy of tax return available

If IRS has no record of the return, determine if the totality of the evidence strongly suggests that a return was filed. (For example, SEI is credited in years prior to and after the year in question. The claimant or a third party provides statements of income earned or cancelled checks or other substantive evidence which shows that SE taxes were paid and the alleged amount of SEI earned for the year(s) in question.)

Submit such cases to

OISP/OEEMP
6401 Security Blvd.
2514 RMB Blg.
Baltimore, Md 21235