Eight things to know if you receive an IRS notice

Say, have you received a notice from the Internal Revenue Service lately?  Every year the IRS sends millions, upon millions of letters and notices to taxpayers.  However that doesn’t mean you need to panic.  Here are eight things every taxpayer should know about the Internal Revenue Service notices should one of them find its way to your mailbox.

  1. Do not panic.  Allot, I mean allot of these letters/notices can be dealt with simply and painlessly.
  2. There is usually a specific reason for the letter.  Sometimes it is a notice to make a payment on your install agreement.  Notify you of changes in your account or request information.  Each notice/letter offers specific instructions on what you need to do to satisfy the notices’ request.
  3. A correction notice is used to make changes to your return, usually a questionnaire is attached.  Review the notice, compare it with your information and reply.
  4. If you do not agree with the change/correction the IRS proposes, respond in writing and explain why you disagree.  Include any documentation that clarifies your position.  Mail with the coupon that is attached to their letter to the address it came from.
  5. Always mail the response to the IRS notice/letter in the time frame given on that letter.  Timetables are crucial.  Allow at least 30 days for a response.
  6. Usually the mail system works well enough that a phone call is not necessary.  However it could be an issue you do not understand, so call the phone number on the upper left hand corner of the notice/letter.
  7. Always have a copy of your tax return in front of you when you call the IRS. Remember to write down the date and time of your call and always get the name and ID number of the IRS employee you are talking to.
  8. It is important that you keep copies of any correspondence between you and the IRS.

Publication 594 from the IRS has expanded information on this subject.