What To Do (and What Not To Do) When You Receive a Letter or Notice from the IRS

Offshore Account Update

Posted on September 16, 2022 |

Recently, the Internal Revenue Service (IRS) published a Tax Tip titled, Got a letter or notice from the IRS? Here are the next steps. In the Tax Tip, the IRS discusses seven steps to take after receiving correspondence from a revenue agent in the mail. These steps, which taxpayers can review in full on the IRS’ website, include:

  • Read the letter carefully
  • Review the information sent with the letter
  • Take any requested action (including making payment)
  • Reply only if instructed to do so
  • Let the IRS know if you dispute the notice
  • Keep the letter or notice for your records
  • Watch for scams

While these are all reasonable steps to take, taxpayers who receive communications from the IRS also need to be careful to avoid mistakes that could lead to problems. With this in mind, here are five tips for what not to do after receiving a letter or notice in the mail:

5 Things Taxpayers Should Not Do After Receiving an IRS Letter or Notice

1. Do Not Make Any Assumptions

When dealing with the IRS, it is important not to make any assumptions. Even if you think you know why the IRS is contacting you, you need to make sure you are addressing the specific issue identified in the IRS’ correspondence—and not some other issue that you might inadvertently put on the IRS’ radar.

2. Do Not Rely Solely On the IRS’ Determinations

While taxpayers have an obligation to pay what they owe, taxpayers should not rely solely on the IRS’ determinations of their liability. If the IRS’ letter or notice says that you owe more than you have paid, you should work with your tax professional or tax lawyer to assess the accuracy of the IRS’ calculation or interpretation of the law.

3. Do Not Submit an Unsubstantiated Dispute

When disputing IRS determinations, taxpayers must submit formal written responses that are fully supported by substantiating documentation. Simply stating that you disagree won’t make the issue go away, and the IRS will treat this type of response as being on par with ignoring the letter or notice entirely.

4. Do Not Ignore the Risks of Facing an IRS Audit or Investigation

While some IRS letters and notices are fairly mundane, others can signal an impending audit or investigation. If you are at risk of facing IRS scrutiny (or are currently facing IRS scrutiny), you will need to approach your response very carefully.

5. Do Not Try To Deal with the IRS On Your Own

Finally, due to the risks of facing an IRS audit or investigation, it is best not to try to deal with the IRS on your own. You can, and should, hire an experienced tax lawyer to help you, and your lawyer can help you make informed decisions while communicating with the IRS on your behalf.

Discuss Your IRS Letter or Notice with Tax Lawyer Kevin E. Thorn

If you need to respond to a letter or notice from the IRS in New Jersey, we encourage you to contact us to discuss your next steps. To schedule a consultation with tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, please call 201-842-7696, email or contact us confidentially online today.

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