Thursday, April 15, 2010

Don’t Panic! Eight Things to Know If You Receive an IRS Notice

The Internal Revenue Service sends millions of letters and notices to taxpayers every year. Here are eight things taxpayers should know about IRS notices – just in case one shows up in your mailbox.
  1. Don’t panic. Many of these letters can be dealt with simply and painlessly.
  2. There are a number of reasons why the IRS might send you a notice. Notices may request payment of taxes, notify you of changes to your account, or request additional information. The notice you receive normally covers a very specific issue about your account or tax return.
  3. Each letter and notice offers specific instructions on what you are asked to do to satisfy the inquiry.
  4. If you receive a correction notice, you should review the correspondence and compare it with the information on your return.
  5. 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.
  6. If you do not agree with the correction the IRS made, it is important that you 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-hand corner of the notice. Allow at least 30 days for a response.
  7. 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-hand corner of the notice. Have a copy of your tax return and the correspondence available when you call to help us respond to your inquiry.
  8. It’s important that you keep copies of any correspondence with your records.
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 or by calling 800-TAX-FORM (800-829-3676).

Friday, April 9, 2010

Ten Last Minute Filing Tips from the IRS

With the tax filing deadline close at hand, the IRS offers 10 tips for those still working on their tax returns:
  1. File Electronically Consider filing electronically instead of using paper tax forms. If you file electronically and choose to have your tax refund deposited directly into your bank account, you will have your money in as few as 10 days. Virtually everyone can prepare a return and electronically file it for free.   For the second year, the IRS and its partners are offering the option of Free File Fillable Forms.   Another option is Traditional Free File.  About 98 million taxpayers – 70 percent of all taxpayers – are eligible for the IRS Traditional Free File. 
  2. Check the Identification Numbers When filing a paper return carefully check the identification numbers — usually Social Security numbers — for each person listed. This includes you, your spouse, dependents and persons listed in relation to claims for the Child and Dependent Care Credit or Earned Income Tax Credit. Missing, incorrect or illegible Social Security numbers can delay or reduce a tax refund. 
  3. Double-Check Your Figures If you are filing a paper return, you should double-check that you have correctly figured the refund or balance due. 
  4. Check the Tax Tables If you are filing using the Free File Fillable Forms or a paper return you should double-check that you have used the right figure from the tax table. 
  5. Sign your form You must sign and date your return. Both spouses must sign a joint return, even if only one had income. Anyone paid to prepare a return must also sign it. 
  6. Mailing Your Return Use the coded envelope included with your tax package to mail your return. If you did not receive an envelope, check the section called "Where Do You File?" in the tax instruction booklet. 
  7. Mailing a Payment People sending a payment should make the check out to “United States Treasury” and should enclose it with, but not attach it to the tax return or the Form 1040-V, Payment Voucher, if used. The check should include the Social Security number of the person listed first on the return, daytime phone number, the tax year and the type of form filed.
  8. Electronic Payments Electronic payment options are convenient, safe and secure methods for paying taxes. You can authorize an electronic funds withdrawal, or use a credit or a debit card. For more information on electronic payment options, visit
  9. Extension to File By the April due date, you should either file a return or request an extension of time to file. Remember, the extension of time to file is not an extension of time to pay.
  10. Forms and publications and helpful information on a variety of tax subjects are available around the clock at You can also check the status of your refund after you file your return by clicking on Where’s My Refund?.