The IRS mails letters or notices to taxpayers for a variety of reasons including:
• They have a balance due.
• They are due a larger or smaller refund.
• The agency has a question about their tax return.
• They need to verify identity.
• The agency needs additional information.
• The agency changed their tax return.
If a taxpayer receives an IRS letter or notice, they should:
• Not ignore it. Most IRS letters and notices are about federal tax returns or tax accounts. The notice or letter will explain the reason for the contact and gives instructions on what to do.
• Not panic. The IRS and its authorized private collection agencies generally contact taxpayers by mail. Most of the time, all the taxpayer needs to do is read the letter carefully and take the appropriate action.
• Read the notice carefully and completely. If the IRS changed the tax return, the taxpayer should compare the information provided in the notice or letter with the information in their original return. In general, there is no need to contact the IRS if the taxpayer agrees with the notice.
• Respond timely. If the notice or letter requires a response by a specific date, taxpayers should reply in a timely manner to:
• Pay amount due. Taxpayers should pay as much as they can, even if they can't pay the full amount. People can pay online or apply online for a payment agreement, including installment agreements, or an Offer in Compromise. The agency offers several payment options.
• Keep a copy of the notice or letter. It's important that taxpayers keep a copy of all notices or letters with other tax records. They may need these documents later.
• Remember there is usually no need to call the IRS. If a taxpayer must contact the IRS by phone, they should use the number in the upper right-hand corner of the notice. The taxpayer should have a copy of their tax return and letter when calling. Typically, taxpayers only need to contact the agency if they don't agree with the information, if the IRS requests additional information, or if the taxpayer has a balance due. Taxpayers can also write to the agency at the address on the notice or letter. Taxpayer replies are worked on a first-come, first-served basis and will be processed based the date the IRS receives it.
"Tax Tips" are published to provide current tax information, tax-cutting suggestions, and tax reminders. If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list to receive other tax information from time to time, please contact our office.
The tax information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance.
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Mia Verc, CPA; Janice Papais, CPA
To better serve our clients and friends, to keep you up-to-date and informed, our blog is a resource for tax tips and overall accounting related articles. We hope you find this useful!