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What happens when you receive a letter from the IRS?

On Behalf of | May 30, 2022 | Internal Revenue Service


It can be an unsettling feeling to receive a letter from the Internal Revenue Service, especially when it doesn’t contain a check. While a letter from the IRS isn’t always bad news, it’s important to know what to do to avoid any potential issues. 

Why did the IRS send a letter?

There are only two main reasons why the IRS will contact you. Either they have some information you need to be aware of, or there is an issue concerning your tax status. These general categories cover the main reasons behind an IRS letter:

  • The agency believes you have a balance due.
  • You are due a larger refund or a reduced tax.
  • There is a query concerning your return.
  • The agency is missing information regarding your identity.
  • The agency needs additional information to process your return.
  • Your return needs to be modified.
  • There is a delay in processing your return.

What should you do now?

The first thing to do is read the letter or notice carefully. The IRS makes a great effort to clearly communicate what the situation entails and what you need to do.

Compare what the letter says and what you believe is accurate regarding your tax filing. If the agency is requesting an adjustment to your tax return, double-check the information you provided. Many taxpayers accept whatever the paperwork says before daring to challenge any discrepancies that may exist. 

If the IRS assessment is correct, and you do owe additional money on your tax filing, be sure to send your payment in as soon as possible. If the sum is greater than your budget allows, you can sign up for a payment plan. The IRS offers flexible terms to help you manage installments on your remaining balance.

Responding to the IRS

Contact information for the IRS will be found in the letter. If there is a specific date required for you to respond, be sure to reply in a timely manner to avoid penalties or interest fees. Responding on time also preserves your right to appeal if you choose to pursue this path.

When responding to the IRS, be sure to keep all original documents related to the communication. Keep these documents in an organized, safe place where you can easily retrieve them for any future needs. Send out copies wherever permissible. 

Receiving a letter from the IRS can feel intimidating, but rest assured, there is typically an amicable solution. The IRS understands that a vast majority of tax filing issues are due to innocent mistakes, so they do their best to help rectify the situation in an easy, nonconfrontational manner. 



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