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What does this letter from the IRS mean?
Don't understand what it means or how to respond? See below some examples and explanations,
Federal Levy on Income Tax Refunds
Levying your federal payments through the Federal Payment Levy Program (SITLP) Under the State Income Tax Levy Program, the IRS
may levy (take) your state tax refund. Currently, this only applies to individual state tax refunds, but may include business state
tax refunds in the future. SITLP matches federal tax delinquent accounts against a database of state tax refunds If your state
tax refund is levied, the state will issue a notice advising you of the levy. The IRS will also issue a notice, after the levy, offering you the
opportunity to appeal the levy. The IRS notice will NOT be issued if you previously received a notice of intent to levy that
advised you of your right to a hearing.
IRS Letter-CP 91 - addressing Social Security Benefits
What is the notice telling me?
This notice is telling you that we intend to issue a levy against fifteen (15) percent of your Social Security benefits that you are entitled to
because you still have a balance due.
What do I have to do?
Pay the amount due as shown on the notice. If you can't pay the whole amount now, call The Sentry Tax Group.
How much time do I have?
You should contact us, The Sentry Tax Group, or pay your balance due immediately.
You have 30 days from the date of this notice to pay the debt in full before the IRS issues a levy.
What happens if I don't pay?
If you don't pay or make arrangements to pay, the IRS will issue a levy against your Social Security benefits to collect the money.
Who should I contact?
If you have any questions about the notice, call The Sentry Tax Group by phone or email.
Do not call the Social Security Administration as they cannot help you they are just processing the demand from the IRS.
What if I don't agree or have already taken corrective action?
If you do not agree with the information in this notice, call The Sentry Tax Group immediately by phone or email to have a
Professional Tax Consultant discuss your options.
What is the notice telling me?
This notice is telling you that the IRS intends to issue a levy against any federal payments due you, such as contractor/vendor payments,
OPM retirement benefits, SSA benefits, salary, or employee travel advances or reimbursements because you still have a balance due on your
tax account. Property, or rights to property, such as real estate, automobiles, business assets, bank accounts, wages, commissions,
and other income are also subject to levy. It is also telling you that the IRS may also file a Federal Tax Lien, if the IRS has not already done so.
What do I have to do?
Pay the amount due as shown on the notice. If you can't pay the whole amount now, contact The Sentry Tax Group.
How much time do I have?
You should contact The Sentry Tax Group immediately for a consultation or pay your balance due to the IRS immediately.
You have 30 days from the date of this notice to pay the IRS before they issue a levy on your benefits or levy your wages.
What happens if I don't pay?
If you don't pay or make arrangements to pay, The Sentry Tax Group can evaluate your options to see what is available to solve you tax debt.
One option the IRS will use is to issue a levy against your federal payments. Another option is to file a Notice of Federal Tax Lien.
The lien gives the IRS a legal claim to your property as security or payment for your tax debt.
Who should I contact?
You can call the IRS yourself or contact The Sentry Tax Group for a Professional Tax
Consultant to evaluate your options to best benefit you, not the IRS!
IRS Letter-CP-2000 - Proposed changes to your tax return
Why did I receive this notice?
Notice CP 2000 shows proposed changes to your income tax return. This proposal is based on a comparison of the income, payments,
credits, and deductions reported on your tax return with information on these items reported to the IRS by employers, banks,
businesses, and other payers. The CP 2000 also reflects any corrections the IRS made to your original return
when they processed it. Note: If the IRS made any changes, they would have sent you a notice at that time.
Is this a bill?
No. They are asking you to verify the income, credits, and deductions reported on your tax return because they're different from the
information IRS received from other sources. They may even be proposing a decrease to your tax.
The CP 2000 is only a proposal that offers you an opportunity to disagree, partially agree, or agree with the proposed changes.
They haven't charged any additional tax at this time.
Why did it take you so long to contact me about this?
Tax years generally end on Dec. 31, but the IRS doesn't receive information from employers, banks, businesses, and other payers until
much later. Once they receive all the tax returns and payer information, our computer system compares the information you reported
with the information the payers provided. This process is very complicated and takes a long time to complete. You may be contacted as early
as 12 months from the date you file your tax return.
What do I need to do?
Review the information in the column marked "Shown on Return" and compare it with the information shown in the column marked
"Reported to IRS (or Proposed by IRS). "
Did you receive the income? If you received the income, was it reported on your tax return? IRS employees search the tax return
and try to locate all income. Sometimes, however, several income items are combined and the employees can't determine the source.
If it wasn't reported on your tax return, was it an oversight? If so, don't file an amended return to report the income.
Just check box "A" on the CP 2000 response page and return it with your check or money order made payable to the United States Treasury.
If you agree with the increase but you can't pay the entire balance due, you may have other options.
Should I call with my response or mail it in?
Your response may be as simple as directing the IRS to a line on your original return where you included the income with another
income source. If this is the case, please call the IRS and provide the information.
If the notice was generated from Brookhaven, Ogden, or Philadelphia the number is 800-829-8310.
If from Andover, Atlanta, Austin, or Fresno the number is 800-829-3009. It may be necessary to write if the issue is more complicated
and you disagree with some or all of the proposed changes. In that case, write a complete explanation of the reasons you disagree. Also,
attach copies of any relevant documents. These may include copies of Form 1099, Miscellaneous Income, Form W-2c, Corrected
Wage and Tax Statement, letters received from payers explaining any changes or corrections, or any other items that support your position.
If you have an unusual tax situation, attach a written statement explaining the reasons you're reporting specific income items
in a certain manner or why you're not reporting the income at all.
I need more time to find my records and go through them all.
Will the IRS allow me additional time to respond? It's important that you respond to the CP 2000 by the due date shown on the notice.
If you don't, the IRS will assume the proposed changes are correct and continue processing the proposal ultimately to an assessment.
If you find you can't respond by the due date on the notice because you need more time to research your records,
please call the toll free number at the top of your notice. The IRS update your records to show you've requested an extension.
Generally, the IRS allow an extension 30 days beyond the response date shown on the notice. It's important to remember that additional
interest and any applicable penalties will accrue on the account during the period of the extension if the tax increase is correct.
Do I have to pay the interest? Can you remove it?
The law requires us to charge interest on any tax that isn't paid by the return due date (Internal Revenue Code Section 6601).
The IRS Restructuring and Reform Act of 1998, however, requires them to notify taxpayers of the proposed discrepancies within 36 months
of the original filing date in order to charge normal interest. They may need to adjust the charge if they make initial contact after that time.
The law allows the IRS to reduce or remove interest on tax increases attributable to errors or delays they made in the performance of
ministerial acts (Tax Reform Act of 1986). A ministerial act is a procedural, mechanical, or processing act that doesn't involve the exercise of
judgment and occurs even though you did everything we required you to do. If you believe you qualify for abatement of interest
based on this provision, you should include your reasons in your response.
The law doesn't permit the IRS to reduce or remove interest for reasonable cause. Reasonable cause only applies to penalties and
refers to an acceptable explanation of circumstances that prevented you from paying the tax when it was due.
What should I do to avoid problems like this in the future?
It's always in your best interest to keep good records of the income you receive throughout the year. By keeping records, you'll know
if you've received all your payment information from employers, banks, and other payers. Note that some states pay taxable
unemployment benefits and report them to you on Form 1099-G, Unemployment Benefits, so be sure to keep that information as well.
It's also important to keep accurate information on any mortgage interest you've paid. This information is reported on Form 1098,
Mortgage Interest Statement.
IRS Letter-CP504 - Notice before Levy
What is the notice telling me? This notice is telling you that IRS intends to issue a levy against your state tax refund or bank account
and even your wages because you still have a balance due on one of your tax accounts. You must pay this amount immediately
to avoid this. It is also telling you that we will begin searching for other assets on which to issue a levy. They may also file a Federal Tax Lien,
if the IRS has not already done so.
What do I have to do? Pay the amount due shown on the notice. If you can't pay the whole amount now, contact The Sentry Tax Group by
phone or email to have a Professional Tax Consultant evaluate your situation to see what your options are, but you have little time to waste.
How much time do I have? You must pay your balance due by the due date shown on your notice.
What happens if I don't pay or contact the IRS? If you don't pay the amount due, the IRS may seize ("levy") any state tax refund to
which you're entitled. This is your notice of intent to levy as required by Internal Revenue Code section 6331(d).
If you still have an outstanding balance after they seize ("levy") your state tax refund, the IRS may send you a notice giving you a right
to a hearing before the IRS Office of Appeals, if you have not already received such a notice.
They may then seize ("levy") or take possession of your other property or your rights to property.
Wages, real estate commissions, and other income
Personal assets (including your car and home)
Social Security benefits
If you don't pay the amount due the IRS can file a Notice of Federal Tax Lien on your property at any time, if they haven’t already done so.
If the lien is in place, you may find it difficult to sell or borrow against your property. The tax lien would also appear on your credit report ―
which may harm your credit rating ― and your creditors would also be publicly notified that the IRS has priority to seize your property.
Can a levy be stopped?
Yes, but you must have all of your tax returns filed up-to-date. An evaluation of your current finances (form 433) needs to be done to
determine what action plan will work best for you, such as an "Installment agreement", "Currently Non Collectable status",
"Offer in compromise", are among the top areas to approach in resolving your tax issues and addressing the problems that
caused you to be in trouble with the IRS or State.
What’s Next? How do I stop the collection process?
By getting into compliance, then arranging an agreement with the IRS or State, whether that is done through an "Installment Agreement",
"Currently Non Collectible Status", or even an "Offer In Comprise", which can be determined with (form433) when
discussing your situation with our Tax Consultants to determine the best approach for your situation.
Can they seize my assets and property?
If you don't deal with your tax issues, Yes, the IRS or State can seize assets and property.
Do I have to file my tax returns?
If you meet the income requirements, Yes, you must file your unfiled returns. Your specific requirements can be determined after reviewing
your IRS or State files. If needed The Sentry Tax Group can assist you in preparing them professionally.
**An extension form (form 4868)can be filed to extend your due date until October 15th.
What do I do if I don't know where I stand with the IRS / State?
Contact The Sentry Tax Group to set up a consultation . Call or click 855-442-5410
Our Enrolled Agents will determine exactly where you are in the collection process and proceed accordingly.