2021 Retirement Plan Limitations
On October 26, 2020, the Internal Revenue Service announced the cost-of-living adjustments (COLA) that will take effect January 1, 2021 (IRS Notice 2020-79). ...
What happens when you get a letter from the Internal Revenue Service?
Some clients have recently received IRS Letter 5071C, which seeks to confirm the identity of the taxpayer. These have been issued in as little as two weeks after a taxpayer has electronically filed an individual income tax return.
First off, don’t ignore the letter---it’s not fake. The IRS has some indication that a confirmation of the taxpayer’s identity is required. It does not mean that the taxpayer’s identity has been stolen. However, be certain to deal with this inquiry in a timely manner. If identity theft has occurred, it’s best to begin to mitigate the damage as soon as possible.
The taxpayer can complete the verification process by calling the IRS, using the number on the 5071C letter or by logging on to the IRS Identity Verification Service website at:
https://www.irs.gov/identity-theft-fraud-scams/identity-verification-for-irs-letter-recipients
Unfortunately, we, as your tax advisors, cannot complete this verification on your behalf. We may assist you and be a part of the telephone conversation, but, you (the taxpayer who received the letter) will still need to be part of this process.
Information that should be gathered prior to placing the phone call or logging on to the IRS website, includes the following:
If the IRS cannot verify your identity to its satisfaction, an in-person appointment at your local office may be required.
Once the IRS has confirmed the taxpayer’s identity, the return in question will be processed. Note, however, that refunds will be delayed due to these additional steps.
One final word on IRS notifications—remember that the IRS will never call, text or email taxpayers asking for information, payments, bank info, etc. If you or anyone you know receives this type of communication, do not give out your personal information. This is not a legitimate means of IRS communication.
As always, your Schneider Downs advisors are available to help you with this type of situation.
On October 26, 2020, the Internal Revenue Service announced the cost-of-living adjustments (COLA) that will take effect January 1, 2021 (IRS Notice 2020-79). ...
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