What Are IRS Computer Notices?
Many queries can plague you if you have IRS problems: Are there errors in my tax return from an IRS computer audit? Do I need to pay more money to the IRS? Am I going to get an IRS notice?
The IRS doesn’t have the manpower to personally audit every taxpayer, so it uses the IRS computer system to review tax returns and send notices. If an error was found on your tax return, you will receive a notice telling you of it and you may be required to pay more money or given a refund, which is not likely. Interest and penalties will be on the balance due. The IRS computers use information from its own files and from other sources.
There are more than 300 kinds of IRS computer notices, commonly:
- Claims you failed to file your tax return – The IRS computer will tell if you filed a return as required.
- Claims you did not report all your income – By scanning its files and comparing information, the IRS computer can tell if you reported all your income.
- Claims you made a math or clerical error – Clerical and math errors are verified when the IRS computer checks your tax return.
Write to the IRS right away and ask for a correction if you receive any of the 300 notices from the IRS and it’s not correct. Don’t hesitate to ask the IRS if you do not agree with their calculations. Most importantly, keep copies of all IRS correspondences in your records.
If you got a notice and indeed owe the IRS money, you have a month to pay before you will start getting the “500 series”, a series of computer-generated bills. You will be reminded that you have tax debt with a CP-501, your immediate action is required through a CP-503, and threatened with a levy if you do not respond immediately with a CP-504.
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