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How to Handle IRS Notices Without Stress

Finding an envelope stamped with "Internal Revenue Service" in your mailbox can be unsettling, triggering an instinctive sense of dread. However, even for those who have meticulously organized their financial affairs, an IRS notification should not be a cause for immediate concern.

Here’s a reassuring fact: most IRS notices are not emergencies. They are usually routine inquiries that can be addressed methodically once you understand the situation.

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So, let’s take a deep breath and proceed systematically.

Why Does the IRS Send Notices?

Every year, the IRS issues millions of notices, typically for a few common reasons:

  • Discrepancy in Data
    The IRS might find that a document like a 1099 or W-2 doesn’t match your tax return, prompting an automatic notice—this isn’t an accusation.
  • Requests for Additional Information
    Missing forms or computational errors may generate queries, often due to minor oversights.
  • Payment Issues
    This could involve misallocated or delayed payments, or discrepancies in amounts submitted.
  • Adjustments in Refunds or Deductions
    These include changes in your refunds or credits based on revised information.
  • Identity Verification
    With heightened identity theft protections, the IRS occasionally requests confirmation of your identity. These notifications are informational.

The Key: Seek Professional Guidance Before Responding

A frequent misstep is reacting to IRS notices without professional assistance. Avoid the impulse to:

  • Instantly pay any stated amount
  • Immediately contact the IRS
  • Submit documents without context
  • Ignore the notice, hoping it will resolve itself

Such actions typically complicate matters. Your best course of action is consulting with a financial expert who can help discern:

  • If the notice is accurate
  • If you actually owe funds
  • If the IRS has made a mistake
  • The necessity of representation or if a simple fix is sufficient
  • The required documentation
  • If a response is needed
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These matters aren’t meant to be navigated solo.

Understanding the IRS Notice Codes

IRS notices include codes such as CP2000, CP14, or CP75, which rapid identification of the issue. Here’s a brief overview:

CP2000 — Underreported Income
This indicates a potential discrepancy in reported income. Often, it results from late or incorrect form filing by others.

CP14 — Balance Due
This reflects an unpaid tax balance, though it might stem from timing issues.

Gain Year-Round Financial Clarity and Confidence
Partner with Lizza & Carullo CPAs & Advisors for ongoing guidance, proactive tax planning, and strategic financial support. Whether you’re growing a business or navigating personal taxes, our year-round advisory approach helps you stay organized, tax-efficient, and in control — with a team that’s here when you need us, not just at tax time.
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CP75 — Audit Documentation Request
This necessitates proof for claimed credits or deductions; it's a standard request.

Letter 5071C — Identity Verification
Part of fraud prevention, not an indication of error on your return.

Notice of Intent to Levy (LT11/CP504)
This demands urgent attention but is resolvable with professional assistance.

Avoiding Common Missteps

A thoughtful, accurate reaction often facilitates resolution, whereas common errors can exacerbate the situation:

Do not disregard the notice—deadlines are critical.
Avoid contacting the IRS without consulting a professional—you might inadvertently consent to incorrect terms.
Refrain from automatically paying the listed amount—errors can occur.
Avoid sending uncontextualized documents—provide clarity.
Do not presume an audit—most notices aren't audit-related.

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Resolution Path

Resolution typically follows these steps:

  1. Consult your financial advisor and review the notice.
  2. Analyze your tax returns and IRS data to identify triggers for the notice.
  3. Assess the validity of the IRS claims.
  4. Formulate a response if required, or state no response necessary.
  5. Verify the accuracy of any owed amounts and allocate payments correctly.
  6. If the IRS erred, craft a compelling explanation with evidence.

Many issues resolve with a single correspondence; a few may require additional exchanges, yet are generally manageable.

The Value of Professional Assistance

IRS correspondence can be daunting, but seasoned professionals encounter these situations frequently. They understand how to:

  • Decipher notice codes effectively
  • Match notices to your tax records
  • Identify common IRS errors
  • Correct misapplied payments
  • Engage with the IRS for clarity
  • Determine when escalation is necessary
  • Decide when non-response is prudent

Most importantly, they provide assurance and protection throughout the process.

If you receive an IRS notice, remember that professional support can illuminate the steps forward.

If you’ve been notified by the IRS — whether bewildered or alarmed — contact us at Lizza & Carullo CPAs & Advisors. We’ll clarify the situation and guide you to resolution.

No panic. No speculation. Just transparent, thorough assistance.

Gain Year-Round Financial Clarity and Confidence
Partner with Lizza & Carullo CPAs & Advisors for ongoing guidance, proactive tax planning, and strategic financial support. Whether you’re growing a business or navigating personal taxes, our year-round advisory approach helps you stay organized, tax-efficient, and in control — with a team that’s here when you need us, not just at tax time.
Schedule Your Discovery Call
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