The first thing you will notice about the letter is it is thin. This should worry you. If it contained forms it would be thick. As you open it, you see at first glance that it is not a form letter. This one has your name and social security number on it.



A thin letter from the IRS usually contains something known as a notice statement. A notice statement is issued for one reason only. The reason is the IRS has determined there is something fishy with your taxes. Okay, now you can panic.

While panic may be the first thing on you mind, once in a blue moon the message in the thin envelope can be good news. Once in a blue moon, the agency will let you know that too much was paid in. Once in a very rare blue moon.

Audit. It is a word that can make a grown man or women weep like a small child. Well, most of these letters are notices of audits. Sorry. Ah, but the audit will rarely be the type of horrific experience you have heard of from someone who knew someone.

The IRS is understaffed. As a result, it does not have the ability to do a massive number of audits. Instead, it does many of them by mail, known as correspondence audits. This means you get to skip a meeting with an agent and try to resolve things through the post.

With a correspondence audit, the nature of the dispute will be identified in the letter. The agency will often indicate it doesn't buy one of your deductions. It will also suggest a revised amount due on your taxes. In short, the problem and solution is provided.

Once you receive the letter, the burden is on you. You are usually allowed to do nothing if you agree with the proposal of the agency. If you want to fight it, you have 30 days to send a letter saying as much and why.

If you accept the proposed changes, the audit is over as long as you take any required action such as sending in more money. If you want to fight the agency, you can. Understand, however, you might be opening yourself up to a full audit.

The IRS issues millions of notices to taxpayers each year. A huge percentage are resolved without blowing up into a bigger audit. If yours does, make sure to get professional help. Tax attorneys offer the best prospect of getting the IRS to back off.