Some taxpayers will receive a letter from the IRS this summer. First, don’t panic and remember that taxpayers have fundamental rights when interacting with the agency.
These rights are in the Taxpayer Bill of Rights. Among other things, these rights dictate that letters from the IRS must include:
Details about what is owed such as tax, interest, and penalties.
An explanation about why the taxes are owed.
Specific reasons about why the IRS may have denied a refund claim.
If you receive a letter from the IRS there are some simple things to do when it arrives. The first step is to give us a call.
Read the entire letter carefully. Most letters deal with a specific issue and provide instructions on what to do.
Compare it with the tax return. If a letter indicates a changed or corrected tax return, review the information and compare it with their original return.
How to Respond
Respond to a letter if you do not agree by mailing a letter explaining why you disagree. Mail the response to the address listed at the bottom of the letter. Include information and documents for the IRS to consider. Allow at least 30 days for a response.
Reply timely if necessary. If you agree with the information, there’s no need to contact the IRS. Some letters have a specific respond by date. Make sure to respond by that time in order to minimize additional interest and penalty charges as well as to preserve your appeal rights.
If you owe money, pay as much as you can, even if it’s not the full amount owed. Pay online or apply for an Online Payment Agreement or Offer in Compromise.
Contacting the IRS
For most letters, there’s no need to call the IRS. If a call seems necessary, call the phone number in the upper right-hand corner of the letter. Have a copy of the tax return and letter on hand when calling.
Keep copies of any IRS letters or notices received with your tax records.
Disclaimer: The items included in the Tax Tip Tuesday Video Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation. IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.