Wednesday, April 4, 2012, AM | Leave Comment
Notices sent by the IRS regarding Form 1040, 1040A, 1040EZ or any of the related schedules, forms or other attachments are called individual filer notices. The IRS may send you a letter or notice to request payment for taxes, notify you of a change to your account, or request additional information.
If and when you receive such correspondence from IRS, don’t be afraid. Open it, read it and see what is required of you to do. In any case, review the correspondence and compare it with the information on your return.
Agree or Disagree
If you agree with the correction to your account, no reply is generally necessary unless a payment is due in which case you should follow the instructions in the letter or notice for sending your payment.
If you do not agree with the correction made to your account, it is extremely important that you respond as requested in the notice on a timely basis.
Write to explain why you disagree, include any documents and information you wish to have considered by IRS and send the information to its office. The address for IRS is generally shown in the upper left-hand corner of the notice. Allow at least 30 days for response.
Handling an IRS notice
Most notices can be handled without calling or visiting an IRS office if you follow the instructions in the notice. If you happen to have questions, call the phone number that is usually found in the upper right-hand corner of the notice.
Be sure to have a copy of the tax return and the notice available when you call so your account can be readily accessible by the IRS.
The Taxpayer Advocate Service (TAS) is an independent organization within the IRS whose employees assist taxpayers who experience economic harm. who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should.
You can contact TAS by calling toll-free 1-877-777-4778. You can also call or write to your local taxpayer advocate, whose phone number and address are listed in your local telephone directory. You can also file Form 911, Application for Taxpayer Assistance Order, or ask an IRS employee to complete it for you.
The Internal Revenue Service (IRS) accepts most tax returns as filed. However, the IRS examines or audits some returns to determine if income, expenses, and credits are being reported accurately.
If your return is selected for examination, it does not mean that you made an error or are dishonest. Returns are chosen by computerized screening, by random sample, or by an income document matching program.
The matching program compares what you reported on your return with what employers, banks, etc., sent to the IRS on W-2s, 1099s, etc. Many examinations result in a refund or acceptance of the tax return without change.
When dealing with the IRS, you may choose to represent yourself or you may have an attorney, a certified public account, an enrolled agent, or any person enrolled to practice before the IRS represent you.
Handling an IRS Audit
The examination of your tax return may take place in any of several ways. Some examinations are handled entirely by mail. Examination not handled by mail can take place in your home, your place of business, an IRS office, or the office of your attorney, accountant, or enrolled agent.
If the time, place or method is not convenient for you, the examiner will try to work out something more suitable. The IRS makes determination of when, where, and how the examination will take place.
After the examination, if any changes to your tax are proposed, you can either agree with those changes and pay any additional tax you may owe, or you can disagree with the changes and appeal the decision.
If you do not agree with the proposed changes, the examiner will explain your appeal rights. If your examination takes place in an IRS office, you can request an immediate meeting with the examiner’s supervisor to explain your position. If an agreement is reached, your case will be closed.
If you cannot reach an agreement with the supervisor at this meeting, of if the examination took place outside of an IRS office, the examiner will write up your case explaining your position and that of the IRS. The examiner will then forward your case for processing.
In a Nutshell
Receiving a notice from IRS does not necessarily mean you are at fault. Read it carefully. If your action upon it is requested, attend to it promptly.