Just the letters IRS can invoke fear and immediate stress with a taxpayer. The IRS sends thousands of letters off each year to taxpayers and the subject of the letters ranges from a missing form to a calculation error in the taxpayers favor. The way a taxpayer responds to these letters normally dictates the positive or negative outcome. Here are 5 simple techniques to effectively and efficiently deal with the IRS.
1. Before calling make sure you understand what the letter you received from the IRS is asking for. If you have a professional tax preparer complete and file your return, talk with them about what the IRS is requesting. If you complete and file your taxes yourself, make sure you understand what part of the return the IRS is talking about. By knowing what the IRS is asking for, your communication with them should be cut in half.
2. Before you call or write the IRS, make sure you have all the facts of your case as well as any backup you may need. If you are amending a return, make sure you have the documentation attached to the amended return. For example, if you received an amended K-1 from a partnership and need to amend your personal 1040, attached the new amended K-1’s with the amended return. If the letter you received asks for specific documents, such as a K-1 or a copy of your W-2, make sure you attach them to the written response or have them on hand when calling the IRS. Also, if you are calling the IRS to complete the communication process make sure you have access to a fax machine. Many times the agent will simply ask for the forms to be faxed over while you are on the phone and you can wrap up the confusion within minutes.
3. Know which section of the IRS you need to talk with. There are several different phone numbers for the IRS customer service line. The individual tax line is 1-800-829-1040, business line is 1-800-829-4933, exempt organizations is 1-877-829-5500 and so on. Knowing which number to call lessens the frustration level of the taxpayer after being on hold for 15 minutes just to be transferred to a different unit. If the letter you received from the IRS has a phone number to call that is the number you should try first.
4. Do not take any comments personally. Many times a taxpayer forgets that the agent has a job to do and they are not personally attacking the taxpayer. The agent normally tries to understand the taxpayer’s situation, the question the taxpayer has and is also working at finding a solution. If you believe the agent you are currently talking with is not being responsive or helpful simply explain to the agent you need leave the conversation, thank them for their help, hang up and call the customer service number again. This process will take some time, but it is worth it to not get into a shouting match with an IRS agent. That will ruin anyone’s day.
5. The last technique is the simplest – tell the truth. Somewhere along the way taxpayers and IRS agents have become weary of one another. Around 45% of IRS agents believe that taxpayers are lying to them. Prove them wrong! Tell the truth without revealing too much information. Answer all the questions with short, direct and honest answers. Do not elaborate on your answer unless otherwise asked. The agent doesn’t want to listen to the sordid story of why you received the letter. They just want the answer to the question so they can go on to the next question.
Nothing will guarantee that the IRS will resolve your situation positively. However, if you incorporate the above 5 techniques into your communications with the IRS, your experience should be much more pleasant.