The IRS Reject Status settings are designed to allow an ERO more control over if or when any IRS Rejected tax returns are announced to their customers. Most EROs choose to never announce this type of return status and instead choose to contact the customer directly and work with them to resolve the issue.
For those EROs which choose to announce IRS Rejects it may be necessary to use a delay so any issues which might be worked out by the RO without engaging the customer have time to be worked. The IRS Reject delay allows the ERO to choose a time of day after which any returns with an IRS Rejection status will be announced to their customers. It’s important to understand that if this setting is enabled and the time for which once the delay was chosen has passed; setting the time to later in the day does not have any effect. If it is necessary to change the time to later in the day the ERO must do so before the delay has expired for the day.
It is important to understand this setting applies for only the day a tax return's status has changed to reflect an IRS Reject status. That is, if a tax return is rejected by the IRS on Monday the IRS Reject delay settings apply for Monday only, the day the IRS Reject status was initially noted and not for any day after. The one exception to this is when the ERO chooses to never annouce IRS Rejects, in that case IRS Rejects are never annouced and instead the tax return will retain a stauts of "Transmitted to the IRS".