Question from a reader:”I received a letter from the IRS and it is scaring the pants off of me. What should I do? I mean other than respond within 60 days?”
My answer is first to take a deep breath and exhale. Then, take your letter to the person who helped prepare your tax return. If you did it yourself, you may want to either read and re-read slowly and carefully the letter or take it to a tax professional for help.
It may just be a spooky letter that is asking you to substantiate something that was either incorrectly reported, possibly incorrectly reported or maybe the IRS or FTB have made a mistake at their end.
Generally, if you are getting a letter and it has no tax penalties or fees levied or underpayment information, the letter may be just a request for clarification. If the letter refers to a prior year’s tax return (and most of them do) there may be listings of where the taxing authority differs from what you filed and what they have calculated as the penalty, interest and things like that.
Remember, you are guilty until you prove your innocence.
Read carefully the options that are presented to you and again, go talk to a decent tax professional who can help you draft a response and if need be, the appropriate tax forms. If an amended return is being asked for, provide it. If they are looking only for a specific form, just give them what they want and any supporting evidence that they ask for to substantiate your claim.
I have answered a lot of letters for clients and myself and the bottom line is to be thorough and think about what they are asking for and give it to them.
Make the answers and responses as clear as possible and as detailed. It will go a long way to trying to get their claim reversed.
Please overcome your fear and just wanting to throw the letter out or stash it away. The response deadlines generally are serious and you want to clear the books as soon as possible.
Good luck and hope that answered your question.
March 24 2009
Interested in any of my books? You may want to make a stop over here. Please click through to purchase my books and some other interesting items that actually ARE on sale. Have you read my book, “Bad Tax Idea, Good Tax”? Please order it today. The tips inside can save you hundreds if not thousands of dollars!
If you are looking for a day job, part time work, suggestions for saving money or investing, please check out my book listed below. Part of all the proceeds from the sales of that book go to Rett Syndrome research. One girl is born with Rett Syndrome worldwide every fifteen minutes. My daughter Arianna has Rett Syndrome and we are working to do all we can to make her life easier and find a cure in her lifetime. Boys born with the Rett gene generally die at birth.
Kim Isaac Greenblatt
More On Spooky Tax Letters from IRS or FTB
Tags: Business, FTB, IRS, tax letter
[...] More On Spooky Tax Letters from IRS or FTB « profitable [...]