This one taxpayer mistake is so simple and sadly so common that taxpayers who make it should kick themselves. Here it is: read your IRS notice. If you receive a notice from the IRS, read it. It’s that simple. Throwing the notice into a pile of other papers, where it will promptly be forgotten, or finding shelter in a concrete bunker is the worst thing you can do. Ignorance is not bliss when dealing with an IRS notice. Typically, IRS notices used to request certain actions by the taxpayer (e.g. agree or disagree with any changes the IRS makes on the return) or seek additional information regarding a tax return (e.g. please provide proof of certain expenses claimed on the return). By ignoring the notice, the taxpayer is often giving up certain rights including the right to later contest any IRS actions. Simply reading the notice can preserve important taxpayer rights.
Now I understand that IRS notices are not always models of clarity so if you don’t understand what the IRS is looking for you can go to the IRS website and read about the notice (the link is provided below). In the upper right hand corner of the IRS notice is a notice number, let’s use CP05A, as an example. CP05A is a common notice number and if you look down the list you will find a quick description of what the notice is for, in this case the IRS states that it is examining the taxpayer’s return and it needs additional documentation. If you click on the notice number you will see additional information on the notice, including what the taxpayer can do to resolve the notice. How very nice of the IRS!
So if you find yourself in possession of an IRS notice don’t panic, just follow the link provided below. Once at the IRS website, find the notice number and read about what the IRS needs from you. If things are too complicated for you, then you should contact an accountant or tax attorney but hiding from the problem or ignoring it is the worst thing you can do. Do not miss out on an opportunity to quickly and inexpensively resolve your IRS matter!
Here is the link to the IRS website with information about IRS notices: http://www.irs.gov/Individuals/Understanding-Your-IRS-Notice-or-Letter
James D. Wade, Esq.
Beacon Tax Advocates, LLC
57 Portland Road, Ste. 3
Kennebunk, ME 04043
207-502-7181
jwade@beacontaxadvocates.com
www.beacontaxadvocates.com