It seems that all too often in this space I end up writing about tax scams and things that the IRS will not do. That space is warranted, as it has sadly become much more likely that you will hear from a tax scammer than from the IRS. I have come to realize, though, that I don’t spend a lot of time on what the IRS will do, and I thought that deserved to be highlighted.
The first step in almost all issues one has with the IRS comes in the form of a piece of actual mail. This is why you can default to not believing many phone calls that say they are from the IRS if you are not aware of any issue. If you happen to receive such correspondence in the mail, really read the letter and understand what the situation is. It is possible that you have made a payment that for some reason did not get recorded or got incorrectly recorded. Some situations can be fixed without too much of headache.
Even if you find that you are in a spot where you owe money, though, do not ignore the situation. Procrastination can open you up to owing more money through penalties and interest.
If you dispute what it says, this is when it becomes important to keep those documents squirreled away that we talked about a few weeks ago. If you hold onto them, and you know that everything in your return is legitimate, these can be used to dispute the IRS’s claims in the letter.
More frightening can be when an IRS representative actually shows up at your business. This does actually happen, and they may even be there to try to collect on a tax debt. If this happens, though, know that they will be carrying official credentials, and you should ask to see them. Legitimate officials will understand you are only carrying out a standard level of due diligence (if you respectfully voice the request).
But know that the IRS will only ever instruct you to make payments to “United States Treasury.” There are many different ways this can be done (debit card, credit card, check, wire, etc.), but it is the only place where legitimate tax payments will be sent.
I also want to mention here about calling the IRS. In general, this is something that is not always necessary, and is probably also something that you want to avoid. Their correspondence often will contain enough information to let you know what your next actions should be. There is a lot of information provided by the agency online, as well, which can answer questions that you have. If a call is necessary, however, I am sad to say that I can only confirm some of the horror stories you may have heard about how long the wait times can be.
I want to close by saying that I understand dealing with any of this is not a happy thing, (I’m pretty sure the only positive experience most ever have with the IRS is when you receive a tax refund), but it should not be seen as frightening or ominous. Handling it timely and with the proper steps will lessen any potential hardship. As always, if this is something you need help navigating, please do not hesitate to contact us.
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