Got a Tax Notice? Here’s What to Do

Receiving a letter in the mail from the IRS or your state or local tax authority can be stressful. We get it! Before you panic, take a deep breath – tax notices are more common than you think, and not all of them have major implications. MPB can always help! Here’s what you should do (and what you shouldn’t do) when you receive a notice.

1. Don’t Ignore the Notice

The worst thing you can do is nothing. Most notices have a deadline to respond, and failure to respond can lead to additional penalties, interest, or enforcement actions like wage garnishment or bank levies. The earlier you address the issue, the better the outcome.

2. Send It to Your Accountant Right Away

Here at MPB, we want to see the notice as soon as possible. Send us a clear scan or picture of all pages of the notice (front and back). Sometimes the key information is on the back of a page or buried in a random paragraph.

Do not try to resolve it on your own until we’ve had a chance to review it. Don’t make any payments or do anything else to deal with it. Let us help determine the best course of action and response.

3. Read (But Don’t Overread) the Notice

Tax notices typically include key information you should look for:

· A tax year

· A reason for the notice (eg. Math errors, missing information, underreported income, balance due, identify verification, etc.)

· An amount owed (if any)

· A due date or a response deadline

It’s helpful for you to read the notice, but don’t stress about interpreting it and figuring it out. That’s our job! Just don’t neglect it.

4. Stay Calm and Be Patient

Getting a notice doesn’t mean you’re being audited or that something major is wrong. Many letters are often just requests for additional information, notifications

of changes, or automatic adjustments. If you are selected for an audit, we’re here to help guide you through it. But many of the notices are simple to resolve.

The thing to keep in mind is that it may take time to resolve. MPB can communicate with tax agencies on your behalf, but those agencies may not process responses quickly. They may say to wait weeks or months to see a resolution, or to reach back out later. We understand how frustrating this can be. Please know that we do everything we can to get these notices resolved as quickly as possible, but also know that the agencies need time to process the requests.

5. Keep a Copy for Your Records

Always save a digital or physical copy of any notice you receive, even after it’s been resolved. These can be helpful if questions arise about prior returns or account activity. MPB will also keep a copy on file, but you should too!

6. Be Proactive About Avoiding Future Notices

After resolving the notice, we may make suggestions for moving forward. We may suggest making estimated tax payments, increasing your withholding, tracking income better, etc. Sometimes a notice is a nudge to address something in your tax process, and we’re here to help if you’ll let us!

Seeing a notice from a taxing authority in your mail can be unsettling, but please don’t let it ruin your day. The key things to remember are:

Don’t ignore it. Don’t panic. Send it to your accountant and let us help.

We deal with letters like these all the time. In most cases, they can be resolved quickly with little headache or correction. If you’ve recently received a notice, let MPB help. Contact one of our offices or reach out to your CPA. We’re here to help give you peace of mind!