I Got a Letter from the IRS! What Do I Do?

Steve Ganns, https://gannsblog.wordpress.com explains what to do when you receive a letter from the IRS.The vast majority of taxpayers will never get a notice from the IRS from one year to the next. Notices go out to maybe 2% of the population at most since most tax returns prepared by professionals are done correctly. However, if you get a letter from the IRS, absolutely do not ignore it.

“I got a phone call from the IRS.”

When the IRS is notifying you about a mistake, or some error on your tax return, they will first notify you by mail, and only by mail. They will not email you. They will not call you.

Actually the first 4 notices will be by mail. If they are ignored, the IRS may start to levy your account or come to your home, but let’s not get ahead of ourselves.

I want to emphasize, in this time of identity theft, do not respond to the IRS unless they send you something in the mail.

“What did I do wrong?”

As many people know, when it’s time to fill out their taxes, taxpayers get a plethora of documents from banks, brokerage houses, etc. These include retirement statements, W2s, 1099s, etc.

The IRS also gets these documents. From time to time, a taxpayer may have forgotten to give something to his tax preparer, or a tax preparer may have forgotten to include something. The IRS matches everything up. If something is missing, they send you a notice, which includes the computed tax that would be due if what they have is correct.

Should I involve my tax preparer?”

Most of these issues are readily taken care of by the taxpayers themselves.

  • If you get a notice and the IRS is correct, you don’t need to do anything unless a payment is due. In that case, instructions will be on the notice telling you exactly how to proceed with payment.
  • If you get a notice and you don’t agree with the IRS, it’s important that you respond and explain why you don’t agree. You don’t automatically have to involve your tax preparer, because unless the tax preparer is at fault, the tax preparer will usually charge for these kinds of services.

“Do I have to visit the IRS?”

You can handle most notices without visiting the IRS. If you have questions, you call the phone number in the upper right-hand corner of the notice. Make sure you have a copy of your tax return and the notice in front of you when you call.

Unfortunately, because there are hundreds of millions of taxpayers and not hundreds of millions of IRS employees, you may be on hold for quite a while. That’s the nature of the beast, and little or nothing can be done about that.

Remember:

  • If you get a notice from the IRS, don’t ignore it. Deal with it, and involve your tax preparer if necessary.
  • Do not fall for phone or email phishing scams. The IRS will not contact you that way.

For more information, you could always look at Publication 594 on the IRS website. Or you can call your business tax preparer, your personal tax preparer, or our offices.

 

Stephen J. Ganns

Stephen J. Ganns, CPA
914-682-7007
steve@gannscpa.com
www.gannscpa.com

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