New Features & Forms in Version 20.2.0.5 Server Patch 3 (Banker Edition)

The IRS is implementing a new IRS 4506-C Request for Transcript of Tax form that will replace the IRS 4506-T Request for Transcript of Tax for lenders using the Income Verification Express Service (IVES). The new form will be required on March 1, 2021.

With the Encompass 20.2 January Service Pack Release, a new Use IRS 4506-C checkbox (field ID IRS4506.X67) has been added to the Request for Transcript of Tax input form and the Request for Transcript of Tax (Classic) input form to indicate whether the 4506-T or 4506-C is used with a loan.

The checkbox is cleared by default for loan file created prior to the Encompass 20.2 January Service Pack release but is selected by default for loan files created after the release. The checkbox is reportable and can be configured in your Data Templates for the Request for Transcript of Tax (Classic).

Both the 4506-T and 4506-C are included in all Closing Packages unless the lender has previously elected to remove the 4506-T from their closing packages.

If the form selected is 4506-C, the Verification of Nonfiling section (section 7) is removed from the form and the remaining sections are renumbered (sections 8 and 9 from the 4506-T are renumbered as sections 7 and 8 on the 4506-C).

The checkbox selection also determines which version of the form is printed. When the checkbox is selected, the 4506-C prints. When the checkbox is cleared, the 4506-T prints.

On the Print window in Encompass, IRS4506T – Trans Request displays when printing either version, but the 4506-C will print when the Use IRS 4506-C check box is selected.

To track electronic versions of the 4506-C in the Encompass eFolder, lenders can first use the Documents setting (Encompass > Settings > eFolder Setup > Documents) to create a new Document container for the 4506-C form. After the document container is created in the Documents setting, users can then select the 4506-C option from the Name dropdown list in the Document Details window in the eFolder.

The recommended best practice for transitioning to the new 4506-C form are listed below:

• Coordinate with your investors to determine which versions of the 4506 form they require for loans closed between December 18, 2020 and March 1, 2021.

• After consulting with your investors and vendors, review your Encompass configuration (including business rules, DDM rules, data templates, SDK plugins) that interact with the Request for Transcript of Tax forms and make any adjustments required to migrate to the 4506-C.

• Review your operational processes and train staff on usage of the new field and how to use the 4506-C to order transcripts.