What to Do If You Receive a Letter from the IRS

Getting a letter from the IRS can be stressful, but it doesn’t always mean trouble. Before you panic, take a deep breath. Most of the time, these letters aren't as scary as you might think.

The IRS sends out millions of notices every year, and many are routine correspondence. Sometimes, these letters are informational, such as confirming a payment, requesting additional information or documentation, or letting you know about an adjustment to your return. Sometimes, it's even good news, such as notifying you about a refund or credit you've missed. Other times, they may alert you to an issue that can be fixed with the right response.

If you’ve received an IRS notice or letter, the most important thing is to stay calm. While we will outline the general steps below, the smartest move is often to have a professional (like us) review your letter first.

Why You Might Receive an IRS Notice or Letter

The IRS typically sends letters for pretty straightforward reasons: 

• You have a balance due

• Your refund amount has changed

• They have a question about your tax return

• They need to verify your identity

• They have changed or corrected your return

• They are delayed in processing your return

Common IRS Notices and What They Mean

Here are some of the most frequent notices and what they're about:

• CP 09 – Earned Income Credit you may be entitled to

• CP 10 – Changes to tax return; reduced amount applied toward payment of estimated tax

• CP 11  – Changes to tax return, the amount you owe has changed

• CP 12 – Changes to tax return; overpayment

• CP 13  – Changes to tax return; no refund and no balance due

• CP 14 – Balance due

• CP 16 – Overpayment applied to balance due

• CP 21B – Changes you requested to your tax return, refund within 2-3 weeks of your notice

• CP 22A  – Made the changes to your tax return; balance due

• CP 23 – Estimated tax payment discrepancy; balance due

• CP 32A – Refund check not cashed, need to send a new one

• CP 45 – Reduced amount applied toward payment of estimated tax

• CP 49 – Overpaid taxes applied to other taxes you owe

• CP 59 – Request for your tax return

• CP 161 – Balance due reminder

• CP 504 – Balance due, Notice of Intent to Levy

• CP 523 – You defaulted on your installment agreement

• CP 2000 – Notice of underreported income

• Letter 531 – Notice of Deficiency

• Letter 525 – General 30-Day Letter

• Letter 12C – Information request

Tip: You can search for details about any IRS notice or letter by using its CP or LTR number, located in the upper right corner of the letter, on the IRS website.

What to Do When You Receive an IRS Letter

1. Read the Entire Letter

When you receive an IRS notice or letter, the first step is to read the entire document thoroughly. The IRS is good at explaining what's going on, what they need from you, and when they need it.

The letter will outline the specific issue, such as a discrepancy they found, a correction made to your tax return, or a request for additional information. It will also state any actions you need to take and any important deadlines. 

However, before taking any action based on the letter, we strongly recommend sending it to us first for professional review. This can save you time, stress, and potentially costly mistakes.

2. Don't Stick Your Head in the Sand

Ignoring an IRS letter is like ignoring a check engine light for your car. It won’t fix itself, and it will probably get worse. Sometimes the letter could lead to penalties, interest, or collection actions.

Even if you need more time to gather information, you should still act now to avoid further complications. Always be sure to respond by the deadline printed in the letter to protect your rights and keep the issue from escalating.

This is the perfect time to reach out to a tax professional before taking any action.

3. Let Us Review Your Records

If the letter indicates changes to your return, send it to us right away. We will compare the numbers with your original return and identify any discrepancies. We can quickly determine whether the IRS is correct or if they missed something or misunderstood your situation.

If they got it right, we will make sure we get your records up to date so that they match. If not, you'll need to gather documentation to support your position.

Keep this notice and your updated records together in a safe place for future reference, especially in case of any follow-up questions or audits. Maintaining organized and accurate records helps you stay informed about your tax status and makes it easier to respond to any future correspondence.

4. Take Action Based on Your Situation

Send us your letter first. 

We'll guide you through the best response strategy for your specific situation, whether you need to:

• Follow payment instructions

• Dispute with supporting documentation

• Make partial payments to reduce penalties

• Provide additional information by the deadline

5. Be Alert for Scams

Unfortunately, scammers love to impersonate the IRS. If something feels off about the letter, maybe the tone is threatening, they're asking for payment via gift cards, or you can't find the notice number on the IRS website, contact us directly at (828) 570-5760.

We can verify whether it's legitimate and handle any necessary IRS communication for you.

Additional IRS Communication Options

• Paperless Notices – Sign up for certain IRS notices through your online account.

• Accessible Formats – To receive notices in Braille, large print, or audio, complete Form 9000, Alternative Media Preference.

How We Can Help

Getting a letter from the IRS doesn't mean you have to figure everything out alone. At Denise Stubbs CPA, we've helped countless clients understand their IRS notices and respond appropriately. We can review your letter, explain what it means for your specific situation, help you gather the right documentation, and make sure you respond correctly and on time.

Don’t stress about it, let us help! Give us a call at (828) 570-5760 or email Info@DeniseStubbsCPA.com to schedule a consultation.

---

This blog post is provided for educational purposes only and does not constitute personalized financial, tax, or investment advice. Tax laws are complex, change frequently, and vary based on individual circumstances. Before implementing any strategies discussed, please consult with qualified financial advisors, tax professionals, or CPAs who can assess your specific situation. This content should not be relied upon as a substitute for professional consultation.