IRS Audit Letter: Understanding Your Tax Audit Notification
The standard way for the IRS to communicate to taxpayers about audits is through various IRS audit letters. When it comes to audits there are a few different types of notifications the IRS will send depending upon how the IRS is planning on auditing you or has audited you. Below are the common IRS audit letters and notifications you may receive from an IRS audit.
- Notice of Audit and Examination Scheduled – This is the standard notice that will be received as the notification to the taxpayer that they will be audited and the IRS wants to meet with them to discuss their tax return.
- IRS Letter 525: General 30 Day Letter – This letter is to inform you that the IRS has a proposed adjustment to your tax return. This can be from a math error or something else that the IRS is fairly confident you have made a mistake on. If you agree with the proposed change made by the IRS then you can sign and return the agreement form. If you don’t agree with the adjustment made by the IRS then you can request an appeal/protest with the IRS office that sent you the letter.
- IRS Letter 531: Notice of Deficiency – This letter is to notify you that you owe additional tax for the tax year/years identified in the letter. This letter will explain how to dispute the adjustments if you do not agree. You can either agree and pay or file a petition with the tax court within ninety days from the date you received the notice.|
- IRS Letter 692: Request for Considering of Additional Findings – This letter is sent along with a report that will give you detailed adjustments made to your tax return. If all looks good and you agree to the adjustments made then you can sign the agreement and return it to the IRS. If you do not agree, you can submit a request to appeal/protest with the office that sent you the letter. You will have to act quickly on this letter if you do not agree because you only have 15 days from the date you received it to request an appeal.
- IRS CP 2000 Notice: Automatic Adjustment Notice – This is one of the most common automated adjustment notices. This notice will show proposed changes to your tax return. The information the IRS uses when sending these out is when it compares income, payments, credits, and other deductions reported on your tax return with the information provided by third parties. Be careful with this notice because many times they are wrong. If you agree, you can agree and pay the amount owed. If you don’t agree you can call the IRS or contest it in writing. If you don’t contest within 60 days then the IRS will make the adjustment final within 60 days.
- IRS CP75 Notice: Exam Initial Contact Notice – This notice states that the IRS is auditing your tax return. You will need to provide additional documentation to support credits that were claimed on your return. Generally, this notice is questioning the Earned Income Credit. They will be holding the Earned Income Credit, additional Child Tax Credit, and Recovery Rebate Credit parts of your tax refund until they receive the results of the audit/documentation from you.
- IRS Form 4564 (IDR): Information Document Request – An information document request (IDR) is the primary tool for the IRS to obtain information from the taxpayer under audit. This is a guide on how an IDR request works, how to respond to the IDR, what happens if you don't respond to the request, and who can help you with this type of audit.
- IRS Letter 915: Letter to Transmit Examination Report – This letter is to notify you of adjustments in your tax amount. If you agree with the adjustment the IRS has made then you can sign and return the agreement form. If you don’t agree, you will need to file an appeal/protest within 30 days of the letter being received.
- IRS Letter 950: 30 Day Letter Straight Deficiency or Over Assessment – This letter is sent after IRS field audits. It is used for un-agreed, straight deficiency, straight over-assessment. This letter will state the findings and if you agree with them then you can sign and return the agreement form to the IRS. If you don’t agree with the findings then you will have 30 days to file an appeal/protest.
- IRS Letter 3391: 30 Day Nonfiler Letter – The IRS will send this letter if it believes you have a tax liability due from returns that you have not filed. The letter includes a proposed adjustment to your tax liability. If you agree with the adjustment proposed by the IRS then you can sign and return the agreement to the IRS. If you don’t agree with the adjustment then you will have 30 days to file for an appeal/protest with the IRS.
It is important to not overlook IRS audit letters because an action is typically required on your part. Just remember that if you don’t agree with the IRS findings you will always have a chance to dispute them with the IRS, but action must be taken soon or it will make it much more difficult. If you are unsure of the appropriate actions to take it is a good idea to consider hiring a tax professional to help you with the audit.
If you are looking for help with a tax audit, review this list of tax professionals who have experience resolving IRS audits or start a search below and click "audit or examination" using the filters on the search page under "problem experience."