What to Do When You Receive an IRS Notice

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Aug 01, 2016

According to a 2016 report from the Treasury Inspector General for Tax Administration, the IRS mailed more than 188 million notices and letters to taxpayers during 2014. There is no reason to believe the number of notices will be slowing down anytime soon. If you are on the IRS mailing list, here is what to do.

Scan the heading. The first line, generally printed in bold type and centered beneath your name and address, will tell you why the IRS is contacting you. Questions about missing information, additional taxes owed, or payments due mean you will want to take prompt action to avoid more notices or assessments of interest and penalties.

Review the discrepancy. You will find the tax form and the year to which the notice applies printed in the upper right corner. Pull out your copy of the corresponding tax return, along with the supporting documents, and compare what you filed with what the IRS is questioning.

Prepare your explanation. Are the proposed changes correct? Did the IRS misapply a payment? Whatever the issue, there is usually no need to file an amended return. However, the IRS typically wants a response, by either phone or mail, in order to clear the notice from your account.

Do not delay. Ignoring IRS correspondence will not make it go away. Reply to the IRS in a timely manner even if you do not have all the information being requested.

Please contact us when you receive a notice from the IRS or state or local taxing authority. We are here to help you resolve the matter as quickly as possible! Reach out to your accountant at 319.364.2945 in Cedar Rapids, or 319.339.4884 in Iowa City.