Nobody wants to see a letter from the Internal Revenue Service (IRS) in their mailbox. The IRS could be sending you a tax letter for several reasons. They might ask you for additional information or notify you of an audit. If you've received a notice in the mail from the IRS, contact a California Tax Attorney to know your rights and options.
Why Does the IRS Send Tax Letters?
The IRS generally sends notices for two reasons. They're either informing you of something or letting you know that you owe taxes. Informational notices may not require action and are just for your records. They might also ask you to change or update information.
The second type of tax letter the IRS sends is to let you know that you owe taxes. They'll notify you if there's a balance on your tax account, telling you how much you owe, when it's due, and how to pay.
Common reasons the IRS sends tax letters and notices:
- Notifying you of a balance due
- Notifying you of a larger or smaller refund
- Asking you a question about your tax return
- Verifying your identity
- Asking for additional information
- Notifying you that they changed your return
- Notifying you of delays in processing your return
What Kind of Letter Could You Receive from the IRS
Both individuals and businesses can receive IRS tax letters. Below is a list of common tax notices that you could receive in California:
- CP 12 – Changes to correct a miscalculation
- CP 49 – All or part of your refund used to pay a tax debt
- CP 90 – Intent to seize assets and notice of your right to a hearing
- CP 2000 – Discrepancy in income or payment information
- CP 504 – Urgent notice of balance due and IRS intends to Levy
- CP 501 – Reminder notice that you have a balance due with the IRS
- CP 91 – Final notice that IRS intends to levy up to 15% of your social security benefits
- CP 14 – You owe money on unpaid taxes
- LT 11 or Letter 1058 – Urgent notice of intent to seize your property or your rights to property for overdue taxes
What to Do If You Receive an IRS Tax Letter
If you receive an IRS tax letter and aren't sure what to do, you can contact an experienced tax attorney. Your tax attorney can help you understand your rights and obligations with the IRS. They can also correspond with the IRS on your behalf. With a detailed knowledge of the U.S. tax code, your attorney may be able to resolve the matter more quickly than if you contact the IRS yourself.
Some IRS letters require no action. If you still have a question, however, you can contact the IRS. The letters they send you will always provide information on how to respond. You may have to fill out and sign forms, or send the IRS additional information.
How to Read an IRS Letter
The first step to reading an IRS letter is opening it. Never ignore a letter from the IRS. You can toss it in the trash, unopened, but doing so won't make your problem go away.
Next, look at the details in the top right corner. You'll see the notice number or code, the tax year involved, the date of the notice, your social security or tax ID number, and the IRS's contact information. The notice number will be like the ones listed above (CP 14, CP 504, etc.). You can search the notice number on the IRS website for an explanation of the letter and steps you should take to respond.
Another thing to notice in your letter is the sending address in the top left corner. The main locations the IRS will send from are Holtsville, KY, Ogden, UT, Kansas City, MO, or Cincinnati, OH. On some letters, however, you'll see a more local address. California residents, for example, might receive notices from the IRS Office in Fresno. If the sending address is local, a local revenue officer may be working on your account, meaning you've been singled out for special attention.
Finally, you should read the “amount due” number carefully. It'll be the boldest text on the page and shows the full amount you owe the IRS for that tax year. Don't let the number alarm you, and read the text that comes after the amount due. If you already have an installment plan in place to pay your balance, the letter will confirm it.
What to Do If You Lose Your Notice from the IRS
You should take care not to lose your IRS tax letter. Immediately after opening it, place it somewhere safe, or put it in your files.
However, if you lose the letter, the IRS has toll-free numbers you can call for help.
- Individuals call 800-829-1040
- Businesses call 800-829-4933
A Scam Phone Call from the IRS
Did you receive a phone call from the IRS instead of a letter? The call was likely a scam. The IRS primarily contacts taxpayers via mail or in-person, not by phone. The IRS is aware of these fraudulent phone calls and has guidance for dealing with them.
The IRS will never do the following:
- Demand immediate payment over a phone call. If you owe taxes, the IRS will always send you a bill in the mail first.
- Demand payment without allowing you to question or appeal the amount.
- Demand that you pay your taxes in a specific way, such as with a prepaid debit card.
- Ask for credit or debit card information over the phone.
- Threaten to arrest you or contact local authorities if you don't pay.
- Threaten legal action like a lawsuit.
Contact a California Tax Attorney
After receiving a notice from the IRS, you may have several questions about your rights or what to do next. An experienced California tax attorney can answer your questions, make sense of your IRS tax letter, and help you avoid unnecessary tax penalties. Call a California Tax Attorney at 310-571-5092 or go online now to schedule a free consultation.