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Knowing What To Do About The IRS Notice You Get In The Mail

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If there's a problem with the federal income tax return you file, the Internal Revenue Service (IRS) will mail you a notice explaining the trouble. While it can be unnerving to receive a letter from the IRS, it's usually not a major reason for alarm. Most issues are resolved easily by mail. But depending on the problem, in some cases, you may need to call or visit an IRS office.

Although there are a number of reasons why the IRS may mail you a notice, some of the most common include:

  • Asking you for more information the IRS needs to process your return.

  • Notifying you of miscalculations you've made resulting in owing a balance due on your tax.

  • Discovering that you've under reported your income. Besides owing more tax, you also may have to pay a fine.

  • Holding your refund until completing a review of the deductions you claimed on Schedule A.

  • Letting you know you may qualify for Additional Child Tax Credit or Earned Income Credit you didn't claim on your return, entitling you to a larger refund.

  • Notifying you of your eligibility for tax deferment because you or your spouse served in a combat zone or hazardous duty station during the tax year.

  • Telling you that because you've been a victim of identity theft, the IRS will monitor your account for future fraudulent activity.

How to handle a notice you receive from the IRS:

  • Don't ignore the letter. Follow the specific instructions that the notice outlines.

  • Provide the additional personal or financial information the IRS requests.

  • Review any corrections the IRS has made to your tax return. Compare the changes to the tax return you filed. In most cases, if you agree with the changes, the IRS doesn't expect you to respond unless it instructs you otherwise.

  • If you disagree with information on the notice, write a letter to the IRS explaining why. Mail your letter and additional documentation you want the IRS to consider to the address that appears in the upper left-hand corner of the notice.

  • Send in a payment you owe if that's the reason for the letter.

  • If the notice is for your child or teen who filed a tax return, let the IRS know the taxpayer is a minor. The IRS will attempt to work out the issue with you as the minor child's parent or guardian.

  • Keep a copy of the notice with your tax return for that year. That way, if you have questions now or in the future, you can call the telephone number listed in the upper right-hand corner of the notice. Have a copy of the notice and your tax return on hand when you contact the IRS.

  • Talk to an expert like Kevin S Hughes CPA for more information.