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If you received an envelope from the Internal Revenue Service (IRS) that does not contain a refund check, your heart rate likely increased. Before you fret, remember that most of the issues in these letters can be dealt with simply and painlessly.
There are a number of reasons the IRS might send you a letter: account change notifications, requesting additional information, and alerting you of upcoming payments. Generally, many of these letters are errors or issued due to a misinterpretation of facts. It isn’t always doomsday.
If you get such a letter, perhaps you overlooked an item of income or the reported amounts on your return don’t match other IRS documents. It is also possible that someone else is using your SSN or is claiming your child as a dependent. The list goes on from here.
What to do?
A notice from the IRS normally covers a very specific issue about your account or your tax return. This notice should offer specific instructions on what you need to do to satisfy the inquiry. Since the law requires that these letters advise you of your rights and other legal information, they can be very lengthy and difficult to understand. So if the IRS sends you a complicated and confusing letter, scan and send a copy of the letter to us so that we can review and handle it accordingly.
Ignoring the message will not make it go away; you’ll just end up getting more notices. As you might expect, each succeeding letter will become more aggressive and more difficult to deal with as time progresses. Procrastination only makes the situation worse!
If the letter says that you owe money, don’t automatically pay the amount the IRS is requesting unless you are positive it is correct. Quite often, taxpayers do not actually owe the billed amount, and it is quite difficult and time-consuming to get a refund should you make the incorrect payment. Our team can help you work through the letter to find out how much is really owed to avoid the confusion.
As letters from the IRS are important and time-sensitive, if you move, be sure to notify them (and your state) of your change of address as soon as possible. Relying on the IRS to be aware of your change of address by checking your annual tax return isn’t enough, especially if your return is on an extension or you are a few years behind.
If you are moving, the IRS provides Form 8822 (Change of Address) for taxpayers who have relocated between tax filings.
You might not like to receive correspondence from the IRS, but as mentioned before, it is always easier to deal with the first notice than to wait. The complications can only increase when notices go unanswered. Should you have any questions about IRS correspondence, please do not hesitate to reach out to us. We handle this all the time and are glad to help decipher what exactly is needed.