You Got a Notice or Letter from the IRS...Now What?
Every year, the IRS sends out millions of notices and letters to taxpayers for a variety of reasons. Upon receiving one in your mailbox, you may be compelled to respond without consulting a tax professional or simply ignore it altogether. In most cases, neither is recommended. At theALG Group, we’re committed to ultimate transparency and approach every tax-related issue armed with the knowledge to make the best and most informed decisions possible.
Here are some tips of what to do and not to do when you receive a notice or letter from the IRS:
- DON’T Ignore It - Most IRS letters regard changes or inquiries about federal tax returns or tax accounts. Some are pretty serious. Some are purely for informational purposes. Either way, they should all be addressed no matter what.
- DON’T Panic - The IRS and its authorized private collection agencies send letters by mail all the time to people allover the country - not just to harass you personally. Keep calm and know that you’re not alone. Panic can only lead to hasty, misinformed decisions that result in worse consequences than if you approached the situation with a clear head.
- DON’T Reply Unless Instructed to Do So - Instead, simply make a note of the contents of the letter for your records. On the other hand, if you owe the IRS or have been selected for an audit, a more strategic approach is in order that only tax professionals like those of the ALG Group can effectively help you devise.
- DO Review the Information - If the letter is regarding a change or correction made to your tax return, it is recommended that you compare the information against the original return under the guidance of a tax professional. If you agree to the changes, make a note of them on your personal copy of the tax return, attach the IRS letter, and retain it for your records.
- DO Take Action As Soon As Possible – The letter might reference changes to your account, taxes owed, payment requests or specific issues pertaining to a tax return. Acting in a timely manner could help you avoid additional interest and penalty fees, as well as preserve your right to appeal if you don’t agree with the notice.
- DO Respond to Disputed Notices – If you don’t agree with the notice you’ve received from the IRS, mail them a letter explaining why to the address on the contact stub included with the notice. Be sure to send along any relevant information and documentation to the dispute for the IRS to review. They typically will issue a response within 30 days.
- DO Remember That There’s Usually No Need toCall the IRS - If you need to contact the IRS by phone, use the number located in the upper right-hand corner of the letter or notice. Make sure to have a copy the tax return in question as well as the letter or notice when doing so. Keep in mind that the IRS is a collection agency, and anything you say during the call can be used to further collection pursuits.
- DO Avoid Scams - The IRS will NEVER initiate contact with you via social media, text message, email or phone.
Use Our FREE IRS Letter Decoder Tool
While the notice or letter you received does provide an explanation of why as well as instructions on how to handle the issue, the reality is that the average person doesn’t speak the same bureaucratic language as the IRS, making it difficult to understand what you’re reading which results in more panic than action.
Located at either the top or bottom right-hand corner of your letter should be a notice (CP) or letter (LTR) number. Simply input this number into our IRS Letter Decoder Tool and click“DECODE”. It will identify the type of notice or letter you’ve received and provide potential next steps - all without the cryptic jargon. Click the button below to get started!ALG IRS LETTER DECODER
If you have any additional questions or concerns, don’t hesitate to give us a call. We’re always here to help: (855) 648-2943.