You filed your tax return on time and paid the taxes due, yet you received a notice from the IRS. Why?
By: Luci Roseman, CPA, Manager
Due to the COVID-19 pandemic, the IRS is experiencing delays in processing paper submissions. There were about 10 million pieces of unopened mail accumulating as of June and the IRS is trying to catch up on the processing of all that mail.
If you receive a Balance Due Notice from the IRS, consider the following questions:
- Is the tax due on the notice the same amount you paid?
- Did you file electronically and pay by check?
If you answer YES to both questions, it is likely that the electronically filed return was posted to your account before the paper check was processed.
I received a Balance Due notice. What now?
Do not send in another letter or payment! It will just add to the backlog of mail for the IRS to sort through and may take months to be processed.
Do not do a stop payment on the check you mailed! Otherwise you may be charged penalties and interest.
Instead, ask your tax professional to call on your behalf to explain the situation and have the IRS agent research your account. They may be able to correct it over the phone. If not you can request a four week hold on any subsequent balance due notices which will give time for the IRS to process the original check you mailed.
How can I avoid this in the future?
Going forward you may want to consider paying electronically to avoid the time delay between when the return is posted and when your check is processed. The IRS Website (https://www.irs.gov/payments) has a number of electronic payment options to choose from.
Looking for updates on the situation?
CLICK HERE to read official IRS updates on this matter. As always, please contact Cover & Rossiter if we can be of any assistance.
Luci M. Roseman, CPA is a Manager in the Tax Department at Cover & Rossiter. She joined the firm in 2011.