September 27, 2022
If you’ve ever gotten an official notice from the IRS, you know the feeling of dread that may settle into your body. While getting a letter from the IRS is no reason to cause alarm, taking care of it in a timely manner could help the matter from become something worse.
Thoroughly read the notice. The notice should be read over with care. Letters regarding federal tax returns or tax accounts make up most of the notices received. The notice will detail the specific issue they are corresponding about and contain all necessary information on next steps and details on how to resolve the issue. It will generally detail taxes owed, any changes noted on accounts, payment requests or other specific issues.
Compare and contrast. Take a look at the information you have versus what the IRS has detailed. If you agree with their statement(s), follow the steps described in the letter.
Get advice. Businesses and individuals with a trusted accountant should immediately reach out to them for advice. You can certainly work though issues brought to light by the IRS on your own. However, having a seasoned professional with the intimate knowledge of your tax situation and the tax code can help minimize tax liabilities and penalties, and the time it takes to deal with the issue.
Contact the IRS for changes. If you or your accounting team have any questions or don’t agree with the information, the IRS will need to be contacted. Be prepared to be patient while waiting for a response.
Save all documentation. Any notices and records of any adjustments should be kept with the correlating year’s tax return for minimum of 3 years from the date the tax return was filed. Make note of any changes on a copy of the return for future reference. Keep copies of all correspondences - what you receive from the IRS and your responses.
Beware of scammers. The IRS will never initially contact a taxpayer via social media channels, text messages or email. They will not threaten police action, jail or prison time. They will not offer gift cards or other irregular forms of payment.
Keep in mind that while the IRS is a government agency, they aren’t infallible. In recent years, especially, they have become extremely short staffed resulting in erroneous tax notices, long response time and other complications. If you receive a notice, stay calm and work through the steps above.