The April 18th tax filing deadline has finally passed. Many managed to successfully beat the clock, even if that meant filing an extension. For some, the stress to get 2016 (and perhaps earlier years) is still a struggle.
If getting the tax return filed timely isn’t stressful enough, receiving Internal Revenue Service (IRS) notices adds an additional layer of anxiety and pressure that many taxpayers simply don’t have the time, energy, or know-how to deal with.
Here are some things to keep in mind should you be one of the “lucky” taxpayers who receives an IRS notice.
First, don’t panic. The IRS sends letters for many reasons. For instance, it could be to inform a taxpayer about a simple correction to the tax return. For instance, they may have updated the street address on the return. If prior year returns filed generally show an address of 21 Jump Street, but the current return now has 21 Jump St., the IRS may correct the information and send a letter referencing the change. In this example, the key is staying consistent in reporting tax demographics.
The IRS could also make changes to other areas such as the adjusted gross income, which could potentially lead to more taxes due. If you agree with the correction, there is no need to reply – just pay the balance if a payment is due. If you disagree with the correction, make sure you respond in writing to explain why you disagree and include documents to support your position. Allow at least 30 days to receive a response from the IRS.
In conclusion, if you receive an IRS notice, make sure to review it carefully, don’t panic, and follow proper steps according to nature of the letter. Remember, seek the help of your local Enrolled Agent, Tax Attorney, or CPA should your tax situation become too overwhelming to manage on your own.
Angelia White, MBA, EA is a tax advisor and financial management consultant with AcctPier Business Solutions LLC. For more helpful tips and information, visit www.acctpier.com. Follow them on facebook.com/acctpier and twitter.com/AcctPier.