The IRS sends millions of letters and notices to taxpayers every year.  Panic is the first response most recipients experience as they tear open the letter.  However, don’t immediately assume the contents of the envelope will be bad.

First of all, many of these letters are merely asking for additional information and can be dealt with fairly easily.  In fact, most correspondence can be handled without calling or visiting an IRS office.  So don’t panic.  Other reasons why the IRS may send you a notice include:

• To inform you of proposed changes to a previously filed tax return,
• To request payment of taxes, interest and penalties,
• To ask you to file a past due tax return.

All IRS correspondence includes specific instructions on what you must do to satisfy the inquiry.  You should never ignore an IRS notice.  If you agree with a proposed correction, then usually no further action is required unless a payment is due or the notice requests additional action.  Read the notice carefully and follow the instructions provided.  If you have questions, call the IRS phone number printed on the notice or call your CPA for additional help.

Be sure to keep copies of all correspondence for your records.  The IRS website – www.irs.gov – provides additional information regarding IRS notices.