IRS e-file validation requirements
Understand the 2 types of IRS validations—business rule and schema—that e-filed tax returns must pass to avoid rejection.
The IRS requires e-file tax returns to follow a rigid structure to ensure IRS systems can receive and view them. The IRS rejects returns that don’t meet these requirements.
The IRS performs 2 levels of validation on all received returns: business rule validation and schema validation.
Business rule validation
The MeF system verifies return data against a series of business rules that test for missing information, mismatched information, or incorrect data.
For example:
- If Form 1120, line 8 contains a non-zero value, you must attach Schedule D (Form 1120).
- If Form 1120, Schedule L is present, Form 1120, Item D Total Assets must equal Form 1120, Schedule L, line 15d.
A failed business rule generates a rejection diagnostic and prevents the return from being e-filed.
Types of business rule diagnostics
Internal validation diagnostics
compare information within the return to business rules. Clear these diagnostics by correcting the tax return information and computing the return.BRMS diagnostics
are generated by the Business Rules Management System (BRMS), which compares the e-file XML file to business rules. Clear these diagnostics by correcting the tax return information and re-creating the e-file or re-generating the validation file. An asterisk (*) appears in front of BRMS diagnostics.Database validation checks
ensure information in the e-file matches information in IRS databases. For example, the IRS rejects returns if the taxpayer's EIN and Name Control (the 1st 4 characters of the taxpayer name) don’t match data in the IRS e-file database. You can't detect this type of violation until you submit the return to the IRS.Schema validation
Schemas define basic requirements for elements—what is required, field length, data type, and allowable values. The MeF system validates each return against the schemas to verify data integrity. The IRS rejects returns with data format errors.
When you create an e-file, the system automatically validates the XML file against IRS schemas. If XML validation errors exist, the
Create E-file
screen reports the number of errors, and each error appears in the menu. You can't submit an e-file if validation errors exist.tip
Clear business validation rules before addressing schema validation errors, as resolving business validations may fix schema validations.
