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Part 4. Examining Process

Chapter 3. Midwest Automated Compliance System (MACS)

Section 6. Special Features and Procedures

4.3.6  Special Features and Procedures

4.3.6.1  (11-13-2008)
Overview

  1. This section describes special features and procedures of MACS.

4.3.6.2  (05-18-1999)
National MACS Database

  1. The National MACS Database is a multi-functional compliance tool containing MACS data for three or more years for the entire country and has expanded programming capability. It is located at MDC and operated under the direction and control of the Director, Compliance.

  2. The National MACS Database can produce profiles of identified segments of the filing population using return, Masterfile and geographical criteria submitted by the requester.

  3. The National MACS Database can also provide electronic subsets and extracts for installation and use only on MACS machines or other C2 secure computer systems. The data will not be in a compressed format. This allows manipulation using commercial software. Other internal and external databases can be compared to the subset/extract. Hardcopy data can also be provided if a profile extract is requested or if there is no C2 secure computer system available.

4.3.6.3  (05-18-1999)
Subsets and Extracts

  1. Subsets and extracts are smaller segments of the MACS database, available only from the National MACS Database at MDC. They may be requested in either hard copy or electronic format.

  2. Because the data is uncompressed, the request should have a limited number of fields. To estimate the hard drive space needed to hold the data, calculate the number of bytes in the requested fields and multiply by the number of returns to be included in the subset/extract. Examples:

    1. Amount fields for individual returns are 10 bytes; business returns are 19 bytes.

    2. Entity fields have 35 bytes each for the name and the address and 25 bytes for city and state (IMF has a combined city/state field).

    3. Other fields are determined by their length, e.g., tax period is six bytes (YYYYMM).

  3. Approximately four times this amount of drive space will be necessary to manipulate the file with database software.

4.3.6.3.1  (05-18-1999)
Subset Requests

  1. Users may request a subset from MDC. All requests must be in writing and signed by the PSP Area Support Manager/Compliance Services Exam Operation Program Manager in the requesting office. Additionally, the request must include all of the following items:

    1. The location of the MACS computer on which the subset will reside (if an electronic subset is requested)

    2. The area number(s) and the file year(s) requested

    3. The MACS filter used to identify the requested segment

    4. The specific fields needed

    5. A file layout similar to the Matcher Program, if a separate file is to be matched against MACS

    6. The name and phone number of a contact person

4.3.6.3.1.1  (05-18-1999)
Subset Request Form

  1. The subset request should be made using the MACS Subset Request form. See Exhibit 4.3.6–1, MACS Subset Request. Note the following requirements which are included on the form:

    1. No downloads or other electronic transmission of MACS subset data will be permitted. All information output from the MACS machine will be in the form of paper reports.

    2. The subset will be destroyed when the project is completed, abandoned or when the data is no longer needed. CD ROM’s containing the subset will be returned to MDC.

    3. All actions will be taken in compliance with the requirements of IRM 25.10, Information Systems Security Handbook.

    4. The request must be mailed, not faxed to:
       MACS Development Center
       Attention: Subset Request
       6040 Earle Brown Drive, Room 306
       Brooklyn Center, MN 55430

4.3.6.3.2  (05-18-1999)
Extract Requests

  1. All extract requests (including profiles) originating in Compliance/Compliance Services areas other than Headquarters will be submitted to the appropriate Area Director. The Area Director will forward the request to the Director, Compliance Policy, ATTN: Centralized Workload for approval. The approved request will then be forwarded to MDC for action.

  2. All extract requests (including profiles) originating in Headquarters and functions outside Compliance/Compliance Services will be routed through their territory manager, etc. for evaluation and approval. The approved request will then be forwarded to Director, Compliance Policy, ATTN: Centralized Workload and after approval, forwarded to MDC for processing.

4.3.6.3.2.1  (05-18-1999)
Requests from Compliance/Compliance Services

  1. Requests for extracts will be made by completing the extract request form and will include the following information as appropriate:

    1. A copy of the CIP or other approved project authorization, if appropriate (with the project and ERCS tracking codes if available)

    2. The name and telephone number of a contact person who can answer questions about the request

    3. For electronic extracts a statement that it will be placed only on the C2 secure system for which it was requested (a copy of the certification must be attached)

    4. For electronic extracts, a statement that no electronic downloads of data will be made (only paper reports may be output)

    5. A statement that the extract will be destroyed when the project is completed, abandoned, or no longer needed. CD ROM’s containing the extract will be returned to MDC.

    6. A statement that all necessary actions will be taken relative to privacy and safeguarding the data to be in compliance with the requirements of IRM 25.10, Information Systems Security Handbook.

  2. MDC will take the following actions:

    1. Upon receipt of the request, review it for completeness and proper approval. MDC personnel will contact the person indicated on the form if the request is incomplete. If no resolution is reached, the request will be returned to the originator.

    2. Service requests in order of date received on a first-in, first-out basis unless otherwise instructed by the Program Manager, Centralized Workload, Examination Return Selection, or delegate.

    3. Send any electronic extracts to the SCP/Configuration Management of the requesting office. Any hardcopy extracts will be sent to the requester.

    4. Retain the ability to recreate electronic extracts for six years.

4.3.6.3.2.2  (05-18-1999)
Requests from Headquarters and Functions Other Than Compliance/Compliance Services

  1. Requests for extracts (including profiles) originating in areas other than Compliance/Compliance Services will be made by the extract request form from the appropriate Field Territory Manager, Area Director or equivalent at the area level through the Headquarters Executive of the requesting office to the Director, Compliance.

  2. The extract request will describe the information needed and the intended use of the data. It should incorporate the following information and language with the expectation that all approvers and users understand and adhere to these requirements:

    1. A copy of the CIP or other approved project authorization, if appropriate (with the project and ERCS tracking codes if available)

    2. The name and telephone number of a contact person who can answer questions about the request

    3. For electronic extracts, a statement that it will be placed only on the C2 secure system for which it was requested (a copy of the certification must be attached)

    4. For electronic extracts, a statement that no electronic downloads of data will be made (only paper reports may be output)

    5. A statement that the extract will be destroyed when the project is completed, abandoned, or no longer needed. Tapes, floppy disks or CD ROM’s containing the extract will be returned to MDC for retention

    6. A statement that all necessary actions relative to privacy and safeguarding the data will be in compliance with the requirements of IRM 2.5.10 Information Systems Security Handbook.

  3. The Director, Compliance Policy or delegate is responsible for timely reviewing all extract requests. The reviewer should consider the appropriateness of the request and verify all mandatory information described above is included in the memorandum. In addition, the reviewer will evaluate whether the information should be obtained from another source. Invalid or incomplete requests will be returned to the requester. Approved requests will be forwarded to MDC for action. Documentation regarding requests will be maintained by the Program Manager, Centralized Workload, Examination Return Selection for review.

  4. MDC will take the following actions:

    1. Upon receipt of the request, review it for completeness and proper approval. MDC personnel will contact the person indicated on the form if the request is incomplete. If no resolution is reached, the request will be returned to the originator. Requests without proper approval will also be returned.

    2. Service requests in order of date received on a first-in first-out basis unless otherwise instructed by the Program Manager, Centralized Workload, Examination Return Selection or delegate.

    3. Send any electronic extracts to the SCP/Configuration Management of the requesting office. Any hardcopy extracts will be sent to the requester.

    4. Retain the ability to recreate electronic extracts for six years.

4.3.6.3.3  (05-18-1999)
Use and Disposition of Subsets and Extracts

  1. Electronic subsets and extracts will be loaded and used only on the C2 secure computer specified in the request.

  2. Any hardcopy data necessary to document the audit trail will be kept for six years. Any electronic subset/extract data on CD ROM will be returned to MDC for disposal. All other data will be destroyed when the project is completed, abandoned, or no longer needed.

4.3.6.3.4  (05-18-1999)
Alternative DIF Delivery and Processing Tool

  1. The Alternative DIF Delivery and Processing Tool (ADDAPT) is a MACS inventory and delivery program for business returns with adjusted gross receipts between $100,000 and $10,000,000. It groups Forms 1040, Schedule C, 1120, 1120S, and 1065 into 23 predetermined major market segments in descending DIF score order.

  2. For returns selected for examination using ADDAPT, information is stored in an inventory area to be accessed when workload is needed. Audits can be started using a MACS facsimile print, or the original return can be ordered.

  3. ADDAPT is a separate program within MACS that uses the MACS database. It organizes business returns within a area into groups by:

    • Market segment

    • Form type

    • PBA/PIA/NAICS Code

    • Income Range

    • Post of Duty

    • Activity Code

    • Grade of Examiner

4.3.6.3.4.1  (05-18-1999)
ADDAPT User Guide

  1. The ADDAPT User Guide is a desk reference produced and periodically updated by MDC.

4.3.6.4  (05-18-1999)
Matcher Program

  1. The Matcher program compares TIN’s in an external file with those on the MACS database. Its primary purpose is to identify nonfilers. In order to run the Matcher Program a research request must be approved. The system administrator is the only person authorized to operate the Matcher program.

  2. Detailed instructions for the Matcher Program are in the MACS System Guide.

4.3.6.5  (05-18-1999)
IS Support Networked Bulletin Board System (MACS Forum and Library)

  1. The IS Support Networked Bulletin Board System provides a nationwide network for sharing information. It contains the MACS forum and library.

  2. The MACS forum is used to share ideas, ask questions, obtain information from MDC and others, discuss hardware and software problems, etc. Specific filter criteria may not be shared through the MACS forum due to security restrictions.

  3. The MACS library contains information such as a current listing of MACS users and system administrators nationwide, specifications for MACS equipment, MACS newsletters, etc. Specific filter criteria may be uploaded through the MACS library. See Exhibit 4.3.6–2, Instructions for Uploading Filters.

4.3.6.6  (05-18-1999)
Filter Sharing

  1. Information on successful MACS filters should be shared with other areas/compliance services areas. MACS filters are Official Use Only. They may be shared:

    • Through the MACS library on the IS Support Networked Bulletin Board System

    • By direct personal, written, or telephone contact

    • Through industry and issue specialists (e.g., Passive Activity Losses, Construction, Partnership, etc.)

  2. Exhibit 4.3.6–2 contains instructions for uploading filters and other pertinent information to the MACS library on the Bulletin Board. Each entry must contain the name and phone number of a contact person.

  3. When sharing filter information, it is essential to differentiate between unproven filters (those that appear to be a good idea, but have incomplete results) and proven filters (those with closed case results). It is important to provide the file year, classification criteria and any other relevant information.

  4. Project information is available on the CIP database. The Headquarters CIP program analyst should be contacted for distribution information. The database contains the following:

    • A brief description of each project

    • Whether MACS was used

    • Project code

    • ERCS tracking code

    • PIA/PBA code(s)

    • Primary and secondary RGS issue codes

    • A contact person and phone number

4.3.6.7  (05-18-1999)
Procedures/System Change Requests

  1. MACS sites are encouraged to suggest enhancements or modifications to MACS.

  2. Form 5391, Procedures/System Change Request, is available for making these suggestions. The request should be routed to Program Manager, Centralized Workload , Examination Return Selection.

  3. Form 5391 should be prepared to:

    1. Request clarification of existing procedures

    2. Request new or additional procedures

    3. Identify procedural problems

    4. Request system changes

  4. See IRM Handbook for procedures on completing and forwarding the form.

Exhibit 4.3.6-1  (05-18-1999)
MACS Subset Request

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Exhibit 4.3.6-2  (07-31-2002)
Extract Request Form

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Exhibit 4.3.6-3  (05-18-1999)
Instructions For Uploading Filters

These procedures will enable MACS users to electronically share potentially productive filters with other MACS sites.
WARNING: These filters are not tested, approved, nor guaranteed by the MACS Development Center. If you have questions concerning the filters, please call the contact person.
How to Upload a Filter
1. Have the system administrator copy the filter you want to share onto a disk.
2. Provide the following information in a separate file. The file should be saved as an ASCII file.
  • Project Name
  • Description
  • Return Type(s): 1040, 1041, 1120, 11205, 1065
  • File Year(s)
  • Applicable IRC Section or other tax law cites, if any
  • Uniform Issue Listing Code(s), if known
  • Classification Instructions
  • Audit Results, if any
  • Area/Compliance Services Area
  • Contact Person
  • Phone Number
  • VMS Number, if available
3. Zip the filter file and the description file together. The program PKZIP can be used. Give the file a name that relates to the project. Use .FTR as the extension. (Having the file extension as .FTR will help distinguish filter files on the bulletin board.) e.g. The zipped file on Schedule C Advertising might be called SCHC_ADV.FTR.
4. Upload the zipped file onto the IS Bulletin Board, MACS Library. Include a description of the file. e.g. Sch C Advertising — Area No. Indicate in the long description area the file is zipped.
The MACS Librarian will verify completeness, i.e., all information in (2) above has been provided. Then they will approve the file for downloading.
Downloading Filters
1. Download the file from the IS Bulletin Board, MACS Library.
2. Unzip the file.
3. Have the system administrator copy the filter file to your directory on the MACS machine
4. Make any necessary geographical changes to the filter. e.g., Zipcode, POD.
5. Follow normal project procedures (CIP, testing, and tracking results, etc.).

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