Tax Notices

Getting a letter from IRS or State Department of Revenue could be alarming for all of us. However, it doesn’t always have to be as unnerving as it appears to be. Each year, the IRS sends out millions of notices to taxpayers. Some are only informational and others require a response. Generally, the IRS or state will send a notice if they believe the taxpayer owes additional tax, are due a larger refund, or if there is a question about their tax return or need additional information.

The letter would state what kind of notice it is, which year it pertains to, which tax matter it relates to and what action needs to be taken upon receiving the notice including the phone number to call to discuss the notice.

What should you do when you receive a letter from the IRS?

• Don’t Panic. You often only need to respond to take care of notice.
• Read the entire notice or letter carefully. Each notice has specific instructions about what you need to do.
• Respond within the required timeframe to minimize additional interest and penalty charges or to preserve your appeals if you disagree.
• If you agree with the notice, you usually don’t need to reply unless there are other instructions or you need to make a payment. Pay as soon as possible.
• If you disagree with the notice, it’s important to respond. You should write a letter explaining why you disagree. Include any information and documents you want the IRS to consider. Mail your reply with the bottom tear-off portion of the notice. Send the information to the address shown in the upper left-hand corner of the notice. Allow at least 30 days for a response.
• Keep a copy of all correspondence with your tax records.

Baldwin CPAs is equipped to resolve all of your tax issues. Please call us if you need assistance. 

/posted by Tripti Kedia, CPA