What To Do If You Receive an IRS Letter — and How To Avoid It Next Year

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For many business owners and individuals, late spring brings more than warmer weather. It can also bring letters from the IRS.

These notices typically start arriving between late May and June and are often related to your most recent tax return. But before you worry, take a deep breath — these letters don’t necessarily mean something is wrong. They’re just the IRS’s way of saying, “We need a bit more information.”

Why Did I Get an IRS Letter?

Most IRS letters are triggered because the IRS found something that doesn’t quite match what you reported on your return. Common reasons include:

• Unreported income, like a 1099 or W-2 that didn’t make it into your filing

• Missing estimated tax payments or payment misapplications

• Clarification needed on deductions, credits, or documentation

Whatever the reason, don’t panic. These letters are routine, and most can be resolved fairly easily — especially when you have support.

What To Do if You Receive a Letter

1. Stay calm. This is a request for clarification, not a penalty or accusation.

2. Do not ignore it. IRS letters often have response deadlines. Delaying can cause unnecessary complications.

3. Send us a copy. As your advisory and tax team, we can interpret the notice, identify exactly what the IRS needs, and help you respond appropriately and accurately.

How To Avoid IRS Letters in the Future

While there’s no guaranteed way to avoid all IRS contact, being organized and proactive significantly reduces your chances of getting flagged. Here’s how:

• Track your estimated tax payments carefully. Be specific about what each payment is for — the year, whether it’s for your business or individual taxes, and the correct amounts.

  
  

• Keep detailed records. Designate a central place (physical or digital) to save documents like:

  • Purchase records

  • Donation receipts

  • Property tax statements

  • Mortgage interest statements

  • Stock sales documentation

    
    

• Communicate life changes. If you’re getting married, going back to school, buying a home, or making other major changes, let us know. These can all impact your tax situation.

Schedule a Mid-Year Review with Us

The best way to avoid surprises next tax season is to plan ahead. A Mid-Year Review helps us catch potential issues early and make sure you’re on track. We’ll review your income, deductions, and any big changes on the horizon, so next year’s taxes are smooth, accurate, and stress-free.