Don't put a tax notice in a drawer. Read it, confirm it's real, note the deadline, and send it the same day to whoever handles that tax: your CPA for income tax, your payroll provider for payroll tax.
Read it before you react
Look for four things on the first page:
- Who sent it: the IRS, a state tax agency, or a state workforce or unemployment agency.
- The notice or letter number. On IRS notices, it's in the right corner.
- The tax year or quarter it's about.
- The response date.
Some notices only give you information. Others ask for money or information by a date. The notice number tells your CPA or payroll provider which kind it is.
Make sure it's real
The IRS starts most contact by regular mail. It doesn't start contact by email to ask for personal or financial information, and it doesn't call to demand payment by gift card, prepaid debit card or wire transfer. If anything feels off, don't call the number on the notice. Log in to your IRS online account, or call the IRS at the number on its website, and check whether the balance or letter shows up there.
Send it to the right person
- Income tax notices, including ones about your personal return or estimated payments, go to your CPA.
- Payroll tax notices, from the IRS or your state, go to your payroll provider first. If they filed the returns, ask whether they will answer the notice for you.
- Send a copy to your bookkeeper too, so any payment or adjustment gets recorded right.
Scan the whole notice, every page, and the envelope if it shows a postmark date.
Don't miss the date
Even when you think the notice is wrong, respond by the deadline. If you need more time, ask your CPA what your options are. Letting the date pass can add penalties or take away your chance to dispute it.
In a made-up example, a practice gets a state notice saying a payroll return for the third quarter is missing. The owner forwards it to the payroll provider the same afternoon. The provider finds the return was filed under an old account number, sends proof, and the notice closes in two weeks with no penalty. The same notice ignored for three months would have turned into a bill.
Why notices happen
Causes can include a payment applied to the wrong quarter, a name or tax ID that doesn't match, a payroll account that changed when a provider switched, or an estimated payment that was missed or late. Have your records in hand when you deal with any of these. That's one more reason to keep payment confirmations and payroll reports where you can find them.
What I'd do this week
- Open any tax mail sitting unopened and note each response date.
- Make sure your payroll provider has your current mailing address for every agency.
- Save every estimated payment and payroll filing confirmation in one folder.
Common questions
Should I call the IRS myself?
You can, but I'd talk to your CPA first. Ask them what the notice means and whether they can handle it for you.
What if the notice says I owe money I already paid?
Send your CPA or payroll provider the payment confirmation.
Can my bookkeeper respond for me?
Your CPA or payroll provider is the one to respond. Your bookkeeper supplies records and records whatever gets paid or refunded.
Want records that make notices easy to answer?
We keep your tax payments, payroll reports and statements organized every month, so answering a notice takes minutes. If that's what you need, apply to work with us.