Your clients may not see additional IRS letters this tax season due to a recent decision made by the agency.
Citing the need to provide additional assistance during tax return season, the IRS has announced that it suspending more than a dozen additional letters, including the mailing of automated collection notices normally issued when a taxpayer owes additional tax and the IRS has no record they filed a tax return (IR-2022-31, 2/9/22).
These mailings include balance due notices and unfiled tax return notices. The IRS entered this tax filing season with a backlog of several million original and amended returns filed by individuals and businesses. The agency claims that the returns haven’t been processed due mainly to challenges posed by the pandemic.
“IRS employees are committed to doing everything possible with our limited resources to help people during this period,” said IRS Commissioner Chuck Rettig in a statement. “We are working hard, long hours pushing creative paths forward in an effort to be part of the solution, rather than the problem. Our employees continue to expend every effort to balance a confluence of multiple, unprecedented demands − including successfully starting the filing season, working our inventory of unprocessed tax returns as well as looking for additional ways to minimize burden for taxpayers, tax professionals and businesses.
Rettig noted this that isn’t the only step the IRS is taking. He said that the agency has redeployed and reallocated resources and implemented innovative strategies in an ongoing effort to provide a meaningful reduction in inventory.
The automatic notices have been temporarily stopped until the IRS works its way through the backlog. It will continue to assess the inventory of prior year returns to determine the appropriate time to resume sending out notices.
Note: Some taxpayers and tax professionals may still receive these notices during the next few weeks. Generally, you don’t have to call or respond to the notice as the IRS continues to process prior year tax returns as quickly as possible. However, if you believe a notice is accurate, you should act promptly to rectify the situation for yourself or a client.
For example, a balance that is due will continue to accrue interest and penalties. Furthermore, IRS employees may issue notices to particular taxpayers to resolve specific compliance issues.
The IRS doesn’t have the authority to stop certain notices that are legally required to be issued within an allotted timeframe. It will continue to assess other changes and system modifications to assist taxpayers on a wide array of issues.
Ken Berry, Esq., is a nationally known writer and editor specializing in tax, financial, and legal matters. During his long career, he has served as managing editor of a publisher of content-based marketing tools and vice president of an online continuing education company. As a freelance writer, Ken has authored thousands of articles for a...