3 Things to do when you receive a letter from the IRS

Don’t PANIC. It may not be a big deal. Take a deep breath and follow these 3 steps.

We’ve all been there. You’re thumbing through your mail and see “IRS” in the top left corner. Your heart skips a beat, your stomach drops.

Don’t PANIC.  It may not be a big deal. Take a deep breath and take these 3 steps.

Step 1: Open the Envelope

Yes, I know that sounds simple, but I can’t count the number of times clients have brought me unopened IRS letters.  I remember hearing a story of a man who waited 2 years to open an IRS letter only to find out it was an Address Change Confirmation. That was a lot of stress for nothing.

Sit down and open envelope.  Read through all the pages.  While it may be wordy and overly technical, it is important to get a full understanding of what the IRS wants to communicate.

Step 2: Respond to the letter

This step usually involves calling the IRS.  The IRS collects two things: information and money.  Your letter will be about one of these items.

The IRS sending you a letter is their “nicer” way of beginning a conversation with you.  If you don’t respond they will use “less nice” ways to get through to you.

Many times, a simple phone call will be all that is needed to resolve the issue.  Or, you may be able to get an extension of time to resolve your issue by asking.  There will be a number listed on the letter.

Step 3: Take Action to resolve

After you have made your initial response of acknowledgement to the letter, get to fixing the problem.

The IRS is a slow-moving organization, but they are moving.  In-action on your part will not make the matter go away. It may take the IRS a while to follow up, but they will follow up.  And each time they do, it gets nastier and harsher.

Maybe you haven’t filed a return because you don’t have the money. Filing the return even without paying the tax will GREATLY reduce your penalties and lessen the damage compared to not filing at all.

Maybe you owe more money than you have. Find a resolution.  Send the IRS a payment and set up an installment agreement.

At this point, any proactive action with the IRS will go a long way to working through, and eventually resolving your tax problem.


Taking these three simple steps will go a long way toward resolving any situation with the IRS.

Jeff Roltgen, Tax Rescue CPA

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