What do people want to know when they get a letter from the IRS?
SAN MATEO, CA: The dreaded letter from the IRS arrives at the worst possible time. You are making holiday plans, the kids are busy in school, and work is out of control. NOW WHAT???
Here are some important points of what to look for on that IRS letter:
1. Reason for the Notice: Is it related to taxes, refunds, payments, or something else? Look in the upper right hand corner of the letter. There will be a letter number or notice number. This is a great starting point to discover what is going on. A good resource to search for the reason behind the letter is the National Taxpayer Advocate website.
2. Deadline: What is the deadline for responding to the notice or taking action, especially if it's related to unpaid taxes. Deadlines are very important because the IRS has a system of automatically jumping to the next level if no response is received.
3. Amount Owed: If the notice is about taxes owed, what is the specific amount and how it was calculated. The letter or notice is required to specify how they arrived at the amount due.
4. Documentation Requested: Sometimes the letter or notice is asking for additional information or documentation that is needed to properly process your tax return or prove a deduction, etc. Carefully read what the IRS is asking for and be sure to include that in your response.
5. Options for Payment: If you determine that the notice or letter requesting an additional payment is correct, what happens if you can't pay the full amount immediately. There are options for payment plans OR if you are unable to pay due to financial hardship you may be made uncollectible OR qualify for an offer in compromise.
6. Penalties and Interest: What are the associated penalties and interest charges in the letter that are included in the amount due? Do I have a case to have some of those? The calculation of penalties and interest are required to be in your letter, if applicable.
7. Consequences of Ignoring: What are the consequences of ignoring the notice, such as liens, levies, or legal actions? Will the IRS simply go away?
8. Seeking Professional Help: Some people want professional advice and should consult a tax attorney or tax professional to help them respond to the notice effectively. Know your taxpayer rights and get the full picture of how to respond to the IRS letter or notice.
Kevin Rego
Law Office of Kevin Rego
650.933.5222
