Dealing with the IRS is never any easy conversation or thought for anyone. The IRS is a strong and powerful 3 letter abbreviation that can stop anyone in their tracks.
For many people, dealing with the IRS isn’t too difficult. They file a tax return each year, and either enjoy a refund or pay the balance due. But for others, dealing with the IRS is a little more fraught with challenges. Those challenges could come from a simple mistake—either on the part of the IRS or the taxpayer—or they may occur when you can’t pay the balance due or your tax return is selected for audit. Whatever the cause, handling IRS problems successfully means following certain rules and knowing your rights. Here are five of the biggest mistakes people make in dealing with the IRS.
In this era of email and paperless billing, who sends mail anymore? The IRS does, and if they have important information for you, your mailbox is the first place you’ll hear about it.
Some people don’t check their mail very often because it’s typically full of junk. Others avoid opening envelopes addressed from the IRS because they just dread hearing what the IRS has to say. But ignoring IRS correspondence won’t make them go away. In fact, it could make your problems worse. If you owe money, delays will just incur more interest and penalties on your taxes, and failing to respond could mean losing out on some of the rights you would have had to contest IRS decisions.
The IRS is a massive agency. Mail gets lost, payments get misapplied and unfortunately, sometimes promises get broken. In these cases, your best defense is a complete record of all correspondence and conversations.
When you mail returns, extension requests, or letters to the IRS, send them Certified Mail Return Receipt Requested, so you’ll have proof of the mailing date. Keep copies of all correspondence received from the IRS. When you make a payment online, keep a copy of the receipt that shows the payment confirmation number. When you have a phone conversation with an IRS employee, maintain a record of the date, their name and badge number, and notes about the call. If an IRS agent agrees to anything, get it in writing.
Dealing with the IRS is important and can be done in many ways. Make sure you have adequate information and do your research before trying to handle any situation.