Epson Stylus 1500 Reference Manual page 80

The perforation of continuous paper is not aligned with the
tear-off position.
Adjust the tear-off position using the Micro Adjust button in
micro adjust mode. See "Adjusting the Tear-off Position" in
Chapter 1.
The auto tear-off setting may be on. Turn this setting off. See
"Using the Default Setting Mode" in Chapter 2.
Make sure that the page length setting for continuous paper is
correct in the Default Setting mode. If not, change the setting.
See "Using the Default Setting Mode" in Chapter 2.
The tractor does not feed continuous paper.
The paper-release lever may be set to the wrong position. Move
the paper-release lever to the continuous-paper position.
The paper has come off the tractor feeder. Reattach the paper to
the tractor.
Continuous paper feeding is crooked or the paper jams.
Make sure the paper supply is not obstructed by a cable or
some other object.
Make sure that your paper supply is positioned within 3 feet
(1 meter) of the printer.
Check that the holes on the sides of the paper are aligned with
each other. Also, make sure the sprocket units are locked and
their covers are closed.
Check that the paper size and thickness is within the specified
range. See Appendix B.
There may be some slack in the paper. Adjust the position of
the sprocket units.
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Troubleshooting