Most mail from the IRS is thick. Whether you realize it or not, we are all conditioned to not freak out when such a letter comes. It is forms and we inherently know this. Ah, but what if you get a thin letter. This one is different and different means bad news.
An IRS notice. It sounds fairly bland, but this is the stuff of heart attacks. Why? The innocuous sounding IRS notice is issued for one purpose. It is notifying you the agency thinks there is something dubious about your taxes. You might want to put 911 on speed dial.
Now, it can be said in truth that the ubiquitous notice sometimes is a good thing. The problem can be that you paid too much money. I had this happen once. Eighteen dollars. This is, however, admittedly a rare event and the news usually is not positive.
The bad news is you are probably being audited if you receive this letter. Go ahead, cry. Let it out. Once you are done, actually read the full letter. The audit may not be the torturous event you are imagining. In fact, it rarely is.
For the majority of people, the indication you are being audited is not the foreshadowing of a rough time you might expect. Instead, you stand a good chance of receiving what is called a correspondence audit. Yep, you get to deal with everything by letter.
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.
At this point, you have a couple of choices. You can agree to the change by usually doing nothing. Alternatively, you can contest it by sending in a letter indicating as much and why you disagree. Finally, you can get on the phone and argue about it.
Most of the proposed changes from the agency are deemed acceptable by taxpayers and the just accept them. If you fall into this category, you can end the audit by doing with the agency asks. If you don't, you can fight the IRS with all that entails.
If you receive the dreaded thin letter from the Internal Revenue Service, don't panic until you actually read it from beginning to end. It may be easy to resolve. If it looks ugly, get professional help or risk the IRS rolling over you like a bug.
