Solving Specific IRS Tax Problems

Solving Specific IRS Tax Problems

Dealing with the IRS can be really stressful and confusing. I totally get it — the tax code is super complicated! But don’t worry, this article will walk you through some common IRS tax problems and give you some tips on how to handle them. I’m not a tax professional, but I’ll try to break things down in simple terms.

Getting Notices from the IRS

If you get a notice from the IRS, don’t panic! Lots of people get them. The notice will explain what issue the IRS identified and what they need from you to fix it. The most important thing is to respond to the notice and send them what they’re asking for. If you ignore it, you’ll likely have bigger problems down the road.

Some common notices are for:

• Math errors on your return – double check your calculations!
• Forgetting to report income – be thorough when you file
• Requesting more information to verify deductions or credits you claimed

You typically have 30 days to respond after receiving a notice. I’d recommend calling the IRS right away so you can get on top of it.

Owing Back Taxes

If you get hit with a big tax bill, don’t freak out. Here are some options:

• Payment plans – The IRS may let you pay what you owe in installments over several months or even years. This avoids getting hit with penalties.
• Offer in compromise – You can settle your tax debt for less than the full amount if you can show you don’t have the means to pay in full.
• Penalty abatement – The IRS may waive penalties if you have a reasonable explanation for why you underpaid initially.

The key is communicating with the IRS early and showing you’re acting in good faith to resolve things. They can be pretty reasonable if you work with them.

Audits

Getting picked for an audit sounds scary. But really, it just means the IRS is double-checking your return to verify you reported everything accurately. They don’t audit people they think were intentionally cheating (that’s the criminal investigation division).

If you get audited, stay calm and gather all the documentation that supports the deductions, income, etc. you reported. Be polite in your interactions with the IRS auditor and explain anything that’s unclear. With good records, most audits go fine and you may just get a small change.

Appealing an IRS Decision

If you disagree with something the IRS decides — like the results of an audit or a penalty — you can appeal it! First, request a manager review your case. If you’re still unhappy, you can take it to Tax Court.

Through the appeals process, the IRS may reduce what you owe or reverse their decision entirely. It’s worth trying if you really think you’re in the right.

Getting Help

Dealing with IRS issues can be overwhelming, I know! Here are some good options for getting help:

• Hire a tax pro like a CPA or enrolled agent – they’re experts at navigating IRS problems
• Contact the Taxpayer Advocate Service – they assist taxpayers free of charge
• Call the IRS hotline or visit your local office – they can answer questions
• Check out IRS information online at IRS.gov

The main thing is don’t ignore IRS letters — communicate with them to resolve issues quickly. And don’t be afraid to get help from a pro if you need it. This stuff is complicated, but the IRS isn’t out to get you. They want people to comply voluntarily. Good luck!