IF you receive an IRS notice, keep the following suggestions in mind:
• Be alarmed, but do not panic. Call your tax professional for guidance. Do not delay your response. Mail your response at least one-week before the specified deadline.
• Do not ignore the notice. Read the notice very carefully and understand what have caused the trigger. Most IRS notices are about your income tax return.
• Read the instruction. Each notice deals with a particular issue and includes explicit instructions on what to do. Understand the instructions and the requirements. If you are confused and clueless, seek advice from your tax professional.
• Respond timely. A timely response could save you from additional charges of penalty and interest.
• Understand the notice. A notice could be about changes to 1) tax return; 2) taxes owed; 3) payment request; and 4) additional information about a specific item on a tax return.
• If you AGREE to changes in your income tax return. Compare your original return versus per IRS income tax return as changed. Double check the information if changes are appropriate. If you agree of the IRS changes and assessment of additional taxes due, pay the tax liability either in full or on installment. Be aware that penalties plus interest continues until the tax liabilities are fully paid.
• If you DO NOT AGREE with the IRS notice. Mail a letter to the IRS: 1) explain why you do not agree; 2) include information and documents to support your disagreement; 3) scan all documents prior to mailing as you might need it for reference if more documentation is required or in case of lost mail; 5) send your mail via certified mail with return receipt for your records and tracking; 6) Use the IRS address provided on the notice; 7) Wait for the IRS to consider; 8) allow at least 30 days for IRS to respond.
• Call if necessary. Use the phone number provided in the notice to call. Be sure to have a copy of: 1) the notice, and 2) tax return with you when calling.
• Keep copies of all IRS notices. Always keep copies of any notices received with your tax records. Make sure to provide copy of the notice to your tax professional.
• Beware of IRS payment scam. You have several payment options for taxes owed. To make a payment, visit IRS.gov/payments or mail your payment to the address provided in the notice. If in doubt, call your tax professional. n
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Disclaimer: Any accounting, business or tax advice contained in this communication is neither intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.
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Al-os & Associates Accountancy Corporation provides accounting and tax services to individuals, corporations, LLCs and business entities. The Firm has a niche in defending taxpayers audited by the IRS and other governmental agencies.
