Oops! IRS Letter to Taxpayers Contains Misinformation

The IRS has issued a news release indicating that 286,000 letters were sent to people who claimed the Earned Income Tax Credit on their 1999 tax returns raising questions about whether these people were entitled to claim the credit.

The letter contained some misinformation about where taxpayers should call to resolve child custody issues. The letter mistakenly directed taxpayers to contact state revenue agencies. Instead, taxpayers with questions about the Earned Income Tax Credit should contact the IRS at 1-800-829-1040.

The reason for the letter was to ask taxpayers to review the rules for the Earned Income Tax Credit to make sure they had correctly claimed the credit. In particular, the IRS wants to point out to these people that any child who makes a taxpayer eligible to claim the Earned Income Tax Credit must have lived with the taxpayer for more than six months during 1999.

Taxpayers who claimed the EITC in error are encouraged to amend their tax returns and remove the credit claim.

All recipients of the original letter should expect a new letter soon, reiterating the IRS concerns and providing the correct telephone number for contacting the IRS.

You may like these other stories...

Starting in October, the IRS will send warning letters to tax return preparers who appear not to be complying with Earned Income Tax Credit (EITC) due diligence requirements.Section 6695(g) of the Internal Revenue Code...
BKD LLP adds Illinois accounting firm Wolf & Co.Springfield, Missouri-based CPA and advisory firm BKD LLP and Chicago-based accounting firm Wolf & Co. have agreed to merge, the firms announced on Monday. Wolf will...
A new government report on Monday found that the IRS may not be completing the required research steps in collecting delinquent taxes before considering the cases “not collectible.”The Treasury Inspector General...

Already a member? log in here.

Upcoming CPE Webinars

Oct 9In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards.
Oct 15This webinar presents the requirements of AU-C 600, Audits of Group Financial Statements (Including the Work of Component Auditors).
Oct 21Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience’s communication style.
Oct 23Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.