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Why is the IRS Sending Me This?!? IRS turns off some notices

2/18/2022

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In a recent announcement, the IRS is telling taxpayers it's turning off some of its automated notices. Here is what you need to know.


Background
With the pandemic, incredibly late tax law changes from Congress, the congressional imposition on the IRS to send out three rounds of stimulus checks, and the requirement to create a new, automatic payment system of child tax credits has created a huge backlog at the IRS. In fact, there are over 6 million tax returns from last year that have still not been processed.


In the meantime, there are automated notices that go out to taxpayers that have not filed tax returns or corrected errors as deemed by IRS audit programming. To make matters worse, payments are being processed without an underlying tax return and the IRS is telling you they will return the money if you do not file your return. Penalties are imposed, there are demands for payment, even repeated notices to fix errors that have been fixed months ago!


Current situation
The IRS is now acknowledging the angst and hardship these notices are causing, at least for some taxpayers. So effective immediately, the IRS is turning off the following notices:
  • Unfiled Tax Return
  • Return Delinquency Notice
  • Balance Due Notices
  • Withholding Compliance Letter
Source: IR 2022-31


What you should know
Don’t fret. IRS notices almost always raise your blood pressure. So open the notice and ask for help.
If you receive a notice, reply to it. While the IRS says it is not necessary to reply, you should probably still do so. Your reply must be timely AND be sent with confirmation of date sent. You can use certified mail or express mail service with tracking information. You don’t want to get caught up in the IRS machine while they try to sort it out.


Compliance is required. While the IRS is turning off many notices, the penalties and interest will still accrue if you have not filed your tax return or owe tax. So file your tax return and pay the tax as it is still required.


E-file helps. While some forms must still be processed via mail, most individual tax returns can be sent via e-file. Continue to file your return digitally whenever possible. Unfortunately, handling these correspondence audits often requires a written response.
It is temporary. The IRS will turn these notices back on after the backlog of tax returns is brought under control.


Sanity will hopefully return and all future tax law changes will be made before the next tax year starts. Just don’t hold your breath and be quick to ask for help if you need 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.
 
We are trusted CPA advisors servicing Burr Ridge, Hinsdale, Willowbrook, Darien, Naperville, and all Chicagoland area. 

Do you need assistance with your business and/or personal tax returns? Would you like to have a trusted source for your accounting, allowing you additional time to focus on increasing your business? Do you use QuickBooks, or plan to in the future, for your accounting? We include these in all our service packages, customized to fit your personal or business needs.   
 
We are currently accepting new clients. Your initial consultation is free, so you have nothing to lose and everything to gain. Our experienced staff is available to help you streamline your accounting, giving you more free time for yourself. Set up an appointment today by calling (630) 320-3720 or email us at info@monarchaccountinggroup.com. 
 
For more free resources, such as Tax Rates, Tax Organizers, and Record Retention Schedules, access our website www.monarchaccountinggroup.com.

Monarch Accounting Group, Inc
145 Tower Drive, Suite 10
Burr Ridge, IL 60527
Phone (630) 320-3720
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Phone: (630) 320-3720

Monarch Accounting Group Inc
145 Tower Drive, Suite 4
Burr Ridge, IL 60527-7836
Email: Info@MonarchAccountingGroup.com


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  • Home
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