IRS Tips and advice to Taxpayers don't go far enough when responding to IRS letters and notices

Editor’s Note: below is the IRS tip entitled “Eight Facts to Know if You Receive an IRS Letter or Notice.” I would add a few more tips as well: (1). make certain that whatever correspondence you send in response is sent via certified mail, return receipt requested from the U.S. Post Office as proof of mailing and receipt is critical in response to a notice/letter; (2) include a copy of the letter or notice IRS sent you; (3) make a complete copy of the correspondence you send back to IRS; (4). in your response, get the name of the individual you spoke with, his Employee ID number, or any other useful identifying information. Frequently, the IRS gives wrong advice on the telephone and you need to prove to someone that you were told to do one thing and were simply following directions (particularly if the directions prove to be wrong). It is too difficult to envision every situation but remember that if you owe money to IRS, the interest and penalty meter continues to run, as a general rule. And if you do not take advantage of your rights, such as the right to a Collection Due Process Hearing, you may lose the right to negotiate a favorable installment agreement (i.e., payment plan), Offer in Compromise, or penalty abatement, to name a few rights.

IRS Tax Tip 2012-73. The IRS sends millions of letters and notices to taxpayers for a variety of reasons. Many of these letters and notices can be dealt with simply, without having to call or visit an IRS office.

Here are eight things to know about IRS notices and letters.

1. There are a number of reasons why the IRS might send you a notice. Notices may request payment, notify you of account changes, or request additional information. A notice normally covers a very specific issue about your account or tax return.

2. Each letter and notice offers specific instructions on what action you need to take.

3. If you receive a correction notice, you should review the correspondence and compare it with the information on your return.

4. If you agree with the correction to your account, then usually no reply is necessary unless a payment is due or the notice directs otherwise.

5. If you do not agree with the correction the IRS made, it is important to respond as requested. You should send a written explanation of why you disagree and include any documents and information you want the IRS to consider along with the bottom tear-off portion of the notice. Mail the information to the IRS address shown in the upper left of the notice. Allow at least 30 days for a response.

6. Most correspondence can be handled without calling or visiting an IRS office. However, if you have questions, call the telephone number in the upper right of the notice. Have a copy of your tax return and the correspondence available when you call to help the IRS respond to your inquiry.

7. It’s important to keep copies of any correspondence with your records.

8. IRS notices and letters are sent by mail. The IRS does not correspond by email about taxpayer accounts or tax returns.

For more information about IRS notices and bills, see Publication 594, The IRS Collection Process. Information about penalties and interest is available in Publication 17, Your Federal Income Tax (For Individuals). Both publications are available at www.irs.gov or by calling 800-TAX-FORM (800-829-3676).
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