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1040SCANverify FAQ
This FAQ is designed to assist users in optimizing their document submission and scanning processes, ensuring a seamless experience with SurePrep's tax preparation services.
Navigating the complexities of document processing for tax preparation can be challenging. This FAQ article will cover frequently asked questions about SurePrep Barcodes, Dependent Documents, SSN Policy, Scanning Documents, and the 1040SCAN Policy. Each section addresses common queries and guides best practices for efficient and accurate document handling.
Topics:
- Barcodes
- Dependent Documents
- SSN Policy
- Scanning Documents
- 1040SCAN Policy
Barcodes
Understanding how to properly use SurePrep barcodes is crucial for ensuring some documents are processed correctly.
- What happens when I resubmit a document in the same binder with a 'Bookmark Only' barcode?Resubmitting a document in the same binder will make the previous submission superseded and data will be deleted. As a result of using aBookmark Onlybarcode on the new document, only identifier fields (e.g., Partnership Name, EIN, SSN) will be captured and the document will be placed under the correct bookmark in theINDEX TREE(in SPbinder), but will not preserve the original data. To prevent this, avoid applying theBookmark Onlybarcode to previously submitted documents.
- How should barcodes be placed on a consolidated statement with multiple account numbers?For multi-account consolidated statement packages, place a Barcode for each unique Account Number in the Package to ensure the appropriate treatment is applied to the Account.
- How will SurePrep process a document that does not belong to the taxpayer or spouse but has an "INCL" barcode on it?For documents with an "INCL" barcode where the SSN does not match the taxpayer's or spouse's, the data will be considered. Pages with an incorrect SSN will be processed using the taxpayer's SSN, which is the first SSN available on the list.
- How will a current tax year document be treated if it is submitted with a BKMG (i.e., Bookmark Only) barcode?If a document, such as Form 1099-R, is submitted with a BKMG barcode, the OCR system captures only identifier fields from the page (e.g., Partnership Name, EIN, SSN). The document skips the Verification Wizard and moves to the next applicable step, so verifiers will not review the document during the verification step.
Dependent Documents
Dependent documents require special attention to ensure they are indexed correctly without capturing unnecessary data.
- Why are Educational Credits (e.g., Form 1098-T and Form 1099-Q) documents auto-indexed under the "Other Information" folder in SPbinder without any data captured?When a taxpayer is marked as a "Dependent of another" in the tax file, educational credit documents like Form 1098-T and Form 1099-Q are auto-indexed under the "Other Information" folder in SPbinder, and their tax data is not captured.
- Why are the dependent’s documents not marked as Incorrect SSN?Dependent documents are not marked asIncorrect SSNbecause the dependent's SSN is proforma'd in the tax file, allowing the documents to be captured. To avoid capturing data from these documents, create anExclude Dependent Documentsverification rule for your firm. To create verification rules, go toAdmin,Review Wizard, then theVerification Rulespage.
SSN Policy
Handling Social Security Numbers (SSNs) accurately is essential for compliance and data integrity. This section explains procedures for when names and SSNs do not match, and how documents are processed with dummy SSNs.
- What should I do if the recipient’s name on the source document does not match the tax file, but capturing the tax data is necessary?Apply the ‘Include’ barcode. Then the tax data from the source document will be captured regardless of the standard policy (e.g. Incorrect SSN, Prior Tax Year, etc).
- Why were Schedule K-1 documents and Consolidated Statements captured if they don't pertain to the taxpayer, spouse, or dependents?For Schedule K-1 documents, Consolidated Statements, and Grantor Trust Letters if the recipient's TIN is in EIN format (XX-XXXXXXX) and the recipient's name includes the taxpayer's or spouse's last name, then the recipient ID is marked as 'EIN,' and the tax data is captured.
- When is Form W3 captured as Form W2? And when is W2 captured as W3?Form W3 is captured as Form W2 when the recipient's Taxpayer Identification Number (TIN) matches the proforma'd SSNs, but the employer's name on the document is not an identical match to the taxpayer's or spouse's proforma'd names.FormCaptured asDoes the recipient's TIN match proforma SSN?Does the employer's name match proforma?W2W3SSN does not matchName matchesW3W2SSN matchesDoes not match
- How are documents handled in 1041 binders when the Recipient's TIN on the document does not match the Proforma'd Trust/Estate EIN?For 1041 binders, if the Recipient's TIN (on the document) does not match the Proforma'd Trust/Estate EIN, the document will be marked asIncorrect EIN. The recipient's last name is not considered in this process.
- Does the EIN/SSN rule apply to 1041 binders?No, the EIN and SSN rule does not apply to 1041 binders. If the recipient's identification number on the document is not pre-filled in the tax file, the document will be marked as "Incorrect EIN."
- How does SurePrep process a document when a dummy SSN is used in the tax software instead of the actual SSN?If a standard document has a dummy SSN (for example, 111-11-1111) in the tax file and the name on the document matches the taxpayer's or spouse's name in the software, the document will be linked to the taxpayer or spouse by selecting the corresponding dummy SSN. This ensures that the document is correctly associated with the individual in the tax software, even when a dummy SSN is used.
- How will SurePrep process documents where the SSN field is 'APPLIED FOR?For documents withAPPLIED FORtext instead of the proforma SSN, and where the recipient's name matches the taxpayer or spouse, the data will be considered and verified accordingly.
Scanning Documents
The quality of scanned documents significantly impacts the accuracy of data extraction. Find out what constitutes a poor scan, how watermarks affect OCR accuracy, and best practices for scanning multi-page documents.
- What is considered a poor scan for tax document processing?A poor scan can prevent accurate processing of tax documents due to issues with Optical Character Recognition (OCR). A scan is considered poor if it exhibits any of the following characteristics:
- Blurry
- Crooked
- Cut Off
- Too Dark or Too Light
- Dark Line Across
- Grainy
- Low-Quality Photo
- Photocopy of Document
- Overlapping Text
- Pale Text
- Skewed in an angle
- Wide Margins
- Whitespace at Edges
- Zoomed In or Out
- Non-Native Stamps, Marks, Text
Additionally, issues such as incomplete scanning, missing pages, improper sequence, or multiple documents scanned together on one page can disrupt the logical flow of information. Deleting primary and mandatory identifiers can also prevent proper data identification and extraction. These factors contribute to a scan being labeled as poor and can impede the processing of tax documents. - Do watermarks on scanned tax documents affect the accuracy of OCR for tax data extraction?Yes, watermarks on documents can interfere with the OCR's ability to accurately read the content. This may result in incorrect identification of the document or improper reading and extraction of the tax data.
- Why was the consolidated statement document marked as superseded when there was no other duplicate copy?Incorrect superseding can happen if document scanning requirements are not followed, especially with multi-page documents like Consolidated Statements. If pages are not submitted in the correct order (e.g., Cover Page, Page 1 of 15, Page 2 of 15, etc.), the system may mistakenly identify some pages as duplicate copies and mark them as superseded. Additionally, deleting the account number on a 1099 Consolidated Statement can disrupt the system's logic, causing broker statements to be incorrectly superseded.
- Why was only one tax document captured when there are multiple document scans on the page, even though all are listed in the Standard Document List?Each page can accommodate only one document for data capture. If a page contains multiple document scans, the system will extract data from only one of them. For example, if both a 1099-INT and a 1099-MISC are on the same page, only one form's data will be captured. To ensure all documents are captured correctly, make sure each document is scanned on its own individual page.
- Why was only the summary table data captured from the consolidated statement during the verification process?If a consolidated statement does not meet scanning requirements, such as having a landscape orientation or low image quality, these issues can impede the OCR technology's ability to read the data accurately. In such cases, only the summary tables will be captured manually. A sticky note will notify the tax preparer that only the summary tables were processed, prompting a detailed review.
- Why were the source documents not captured when I submitted a prior year's federal tax return PDF along with the source documents?When you submit a federal tax return PDF along with source documents in the same binder, it can lead to data processing errors, such as data duplication. To prevent these issues, data is not extracted from the source documents. Instead, they are automatically indexed with generic names under their respective folders in the SPbinder Index Tree. If you want data extracted from both the tax return and the source documents, please submit them separately in different submissions, and the data will be processed accordingly.
- How does SurePrep process Schedule K-1s with a "Do Not Use Part III" watermark?Schedule K-1s that have a "Do Not Use Part III" watermark will be bookmarked, and data from Part III will not be captured. This ensures that only the relevant parts of the document are processed, in accordance with the provided instructions.
1040SCAN Policy
The 1040SCAN Policy section provides insights into how SurePrep processes various forms, ensuring that your tax data is captured accurately and efficiently.
- How can I ensure the appropriate form is captured when submitting Form W-2 and Form W-3 with identical tax data in the same binder?If you submit W-2 and W-3 forms with identical tax data together in the same binder, only one form will be processed. To ensure a specific form is captured, apply the 'Include in return' barcode to the form you want processed. For the form that should not be captured, use theDelete DataorBookmark Onlyoption.
- How does SurePrep process a W-2 for a company?If a W-2 form belongs to a company rather than the taxpayer or their spouse, the document will be marked as having an incorrect SSN, and no data from it will be captured. This ensures that only relevant personal tax documents are processed and included in the tax return.
- How will SurePrep process a Form 1099 Consolidated Statement if the summary page(s) are missing?Missing summary pages on a Form 1099 Consolidated Statement can lead to incorrect or incomplete data capture, and Foreign Income and Tax Exempt details may not be considered. SurePrep will attach a sticky note requesting the client to verify the data's accuracy. To ensure accurate processing, please submit complete Form 1099 Consolidated Statements.
- How does SurePrep process documents when regular, crypto, and supplemental consolidated statements are received in the same binder along with the main consolidated statement set?When a Form 1099 consolidated statement is received along with crypto and supplemental consolidated statements for the same account or entity, data from all sets will be considered. None of the documents will be marked as duplicates, ensuring comprehensive data processing. This approach allows for the complete and accurate capture of all relevant financial information.
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