The IRS has recently announced it is turning off some of its automated notices. Here’s what taxpayers need to know…

With everything that’s been going on – the pandemic, multiple rounds of stimulus checks, Congress’ tax law changes, the update to child tax credits – it’s caused quite a backlog for the IRS to work through. So much so that there are over 6 million tax returns from the previous year that still have yet to be processed. 

Up until this point, the IRS has sent out automated notices to taxpayers who need to correct errors on their returns or to those who have not filed a return. An issue is that payments are being processed without an underlying tax return. Then the IRS reaches out stating if the taxpayer does not file the return, they will return the money. This becomes a mess involving demands for money, penalties, and repeated notices asking for errors to be corrected that have already been corrected. 

This is why the IRS is turning off some of its notices. 

The IRS has acknowledged that these notices are causing confusion and stress for many taxpayers. So as of now, they have turned off the following: 

  • Notices for Return Delinquency 
  • Notices for Unfiled Returns
  • Notices for Balances Due
  • Notices for Withholding Compliance 

Source: IR 2022-31

What you need to know… 

Don’t worry! If you receive a notice from the IRS and don’t understand it, don’t stress. Just reach out and ask for help. 

Reply to any notices you receive. While the IRS does say that it’s not necessary to reply to their notices, it certainly doesn’t hurt to do so. It’s good practice to reply right away and keep proof of the date of your reply. If you reply via mail service, keep documentation of your tracking information. 

Always comply. Just because the notices have been turned off, it doesn’t mean that the penalties don’t still apply. If you have not filed a tax return, penalties and interest will be applied.

E-file when possible. If you’re able to do so, digitally file your tax return. But if a written response is required, you’ll need to send that in by mail. 

This is only temporary. Once the IRS has worked through their backlog, they will resume their automated notices. 

Hopefully going forward, any tax law changes will be made a year in advance. Just be patient and if you need help, ask for it.

And if you have questions about your personal or business tax return, give us a call at Minton CPAs & Associates: 757-546-2870.