The IRS is Not Always Right

Joseph A. Lux

October 1, 2019

If you are like me, your heart starts to beat a little faster whenever you open the mail box and find a letter showing the sender to be the Internal Revenue Service. Even after thirty years of experience dealing directly with the IRS for both myself and hundreds of clients, I still get anxious whenever I see that return address. Sometimes it is a refund check! Often it is not a refund but a bill! And, to make matters worse, the cover letter says, “if we do not hear from you by…… we will…….”. Now my heart (and my imagination) is really racing.

A letter in the mailbox with IRS as the return address is sure to raise your blood pressure. Here are some tips for handling the situation if this happens to you:


Stay calm. Try not to overreact to the correspondence. They are often in error. This is easier said than done, but remember the IRS sends out millions of notices each year. The vast majority of them correct simple oversights or common filing errors.

Open the envelope. You would be surprised at how often people are so stressed by receiving a letter from the IRS that they cannot bear to open the envelope. If you fall into this category, try to remember that the first step in making the problem go away is to simply to open the envelope.

Carefully review the letter. Understand exactly what the IRS thinks needs to be changed and determine whether or not you agree with its findings. Unfortunately, the IRS rarely sends correspondence to correct an oversight in your favor, but its assessment of your situation is often wrong. Take time to compare their figures to your tax return.

Respond timely. The correspondence should be very clear about what action the IRS believes you should take and within what timeframe. Delays in responses could generate penalties and additional interest payments.

Get help. You are not alone. Getting assistance from someone who deals with this all the time makes going through the process much smoother.

Correct the IRS error. Once the problem is understood, a clearly written response with copies of documentation will cure most of these IRS correspondence errors. Often the error is due to the inability of the IRS computers to conduct a simple reporting match. Pointing the information out on your tax return might be all it takes to solve the problem.

Use certified mail. Any responses to the IRS should be sent via certified mail. This will provide proof of your timely correspondence. Lost mail can lead to delays, penalties and additional interest on your tax bill.

Don't assume it will go away. Until a definitive confirmation that the problem has been resolved is received, you need to assume the IRS still thinks you owe the money. If no correspondence confirming the correction is received, a written follow-up will be required.

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