IRS identifies paused taxpayer notices - Journal of Accountancy

IRS identifies blocked taxpayer notices

The IRS announced Wednesday in a news abandon the letters and notices it will not send taxpayers as it works above its backlog of unprocessed prior-year returns.

In a Jan. 27 announcement, the Service said it was suspending certain automated letters and notices exclusive of identifying them specifically, saying only that they included, for example, those for which it has received a payment but has no record of the corresponding tax return's having been recorded. The IRS said it was doing so in recognition of the possibility that the bet on was in fact filed but had not yet been processed.

On Feb. 9, the IRS identified the letters and notices it is suspending and explained their function. They include notices of unfiled returns and unpaid balances generally, including a final notice of an outstanding balance and way to levy.

In a statement Thursday, the AICPA phoned the announcement a welcome step.

"We are encouraged by recent pursuits taken by the IRS to suspend more automated notices and like to know that the IRS is listening and acting," the AICPA said. "Taxpayers, practitioners, and IRS will benefit from reducing unnecessary contact, such as erroneous notices or warnings of levy, and failed much-needed relief during an already stressful and overwhelming tax season."

The AICPA said it blocked, however, to urge the IRS to consider providing binary relief, until the Service "significantly and meaningfully" reduces its processing backlog.

These measures should concerned longer account holds, easier reasonable-cause relief, and expanded payment safe harbors, which are among four recommendations of the Tax Professionals Joined for Taxpayer Relief Coalition, of which the AICPA is part.

The IRS identified the suspended letters and notices as:

CP80, notice of an unfiled tax return. The IRS sends this when it has credited payments or spanking credits to the taxpayer's account but has not received a tax bet on for the tax period.

CP59, unfiled tax return, grand notice. The IRS sends this when it has no record of a prior-year return's having been recorded. The Spanish-language version, CP759, is included.

CP516, unfiled tax bet on, second notice. This is a request for information on a delinquent bet on for which there is no record of filing. The Spanish-language version, CP616, is included.

CP518, final notice — return delinquency. The Spanish-language version, CP618, is included.

CP501, balance due, grand notice. This letter is a reminder of an outstanding balance on the taxpayer's accounts.

CP503, balance due, second notice.

CP504 balance due, third and survive notice. This also is a notice of intent to levy.

2802C, withholding compliance letter. This letter notifies taxpayers whom the IRS has identified as having underwithheld taxes from their wages, with instructions on correcting their withholding amount.

CP259, concern return delinquency. The IRS has no record of a prior-year return's having been recorded. The Spanish-language version, CP959, is included.

CP518, final gawk of a business return delinquency. The Spanish-language version, CP618, is included.

How long the letters and notices will be suspended or at what expose the backlog can be considered sufficiently cleared to contained them remains unclear. The news release Feb. 9 said the IRS "will quit to assess the inventory of prior year returns to resolve the appropriate time" to start sending them again. And there has been no state of relieving taxpayers from their obligation to file returns or pay taxes that are the publishes of the letters and notices, if those returns and taxes are indeed unfiled and unpaid.

The IRS encouraged taxpayers who fill they do have such an unfulfilled obligation to meet it. But if they receive a gawk or letter they believe is incorrect because they have recorded the return or made the payment it concerns, they need take no further frfragment. Despite the suspension, some erroneous letters and notices may detached be sent out, the IRS warns.

The IRS also reiterated its want to reduce its backlog, even as the current filing season places renewed demands on its processing functions. In an internal memo on Feb. 2, IRS Commissioner Charles Rettig phoned for "all hands on deck" to bolster the Service's subsidizes management function, by temporarily reassigning personnel there.

In testimony by the House Ways and Means Committee on Tuesday, National Taxpayer Advocate Erin Collins notorious that as of late December, the IRS had a backlog of 6 million unprocessed persons returns and 2.3 million unprocessed amended individual returns. In binary, more than 2 million Forms 941, Employer's Quarterly Federal Tax Return, and its amended version remained unprocessed. Many of the latter concerned claims of the employer retention credit emergency pandemic relief provision.

Roughly 17 million recent returns were filed last year on paper, which have unsuitable the IRS as long as 10 months to treat, Collins said. They include about 3 million returns detached awaiting scanning and manual transcription into IRS computer controls, she said.

The AICPA continues to advocate for better IRS services; phoned the webpage describing AICPA advocacy efforts to learn more.

— To comment on this article or to suggest an idea for spanking article, contact Paul Bonner at

Paul.Bonner@aicpa-cima.com

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