Publication 3112 (Rev. 5-2013) - Internal Revenue Service

The IRS may list in the Internal Revenue Bulletin, newsletters, or othermedia the name and owner of any entity suspended, expelled, or revokedfrom participation in IRS e-file and the effective date of the IRS action.Levels of Infraction,Level One Infractions — Level One Infractions are violations of IRS e-filerules and requirements that, in the opinion of the IRS, have little or no adverseimpact on the quality of electronically filed returns or on IRS e-file.The IRS may issue a written reprimand for a Level One Infraction.Level Two Infractions — Level Two Infractions are violations of IRS e-filerules and requirements that, in the opinion of the IRS, have an adverse impactupon the quality of electronically filed returns or on IRS e-file. Level TwoInfractions include continued Level One Infractions after the IRS has broughtthe Level One Infraction to the attention of the Authorized IRS e-file Provider(Provider).Depending on the infractions, the IRS may either restrict participationin IRS e-file or suspend the Authorized IRS e-file Provider from participationin IRS e-file for a period of one year beginning with the effective date ofsuspension.Level Three Infractions — Level Three Infractions are violations of IRS e-filerules and requirements that, in the opinion of the IRS, have a significantadverse impact on the quality of electronically filed returns or on IRS e-file.Level Three Infractions include continued Level Two Infractions after the IRShas brought the Level Two Infraction to the attention of the Provider.A Level Three Infraction may result in suspension from participation inIRS e-file for two years beginning with the effective date of the suspensionyear, or depending on the severity of the infraction, such as fraud or criminalconduct, it may result in expulsion without the opportunity for future participation.The IRS reserves the right to suspend or expel a Provider prior toadministrative review for Level Three Infractions.The firm, Principalsand ResponsibleOfficials of deniedapplicants andsanctioned AuthorizedIRS e-file Providersare entitled to anadministrative review.Administrative Review,The firm, Principals and Responsible Officials of denied applicants andsanctioned Authorized IRS e-file Providers (Providers) are entitled to anadministrative review. The administrative review process is usually a two-stepprocess. Firms, Principals or Responsible Officials request administrativereview by the office that denied or sanctioned it. If the reviewing officeaffirms the denial of the sanction, firms, Principals or Responsible Officials27