Why am I receiving an IRS Notice stating I owe for unpaid taxes?

Since Mid-March, the Internal Revenue Service has either furloughed or placed employees on work from home status closing offices. In having no one physically present in the offices, the Service has no one to process the tens of millions (yes, that is correct) pieces of mail that have been sent with either return, correspondence, or payments.

CP notices (the notice or letter-number appears in the upper right-hand corner of the correspondence) means that the notice was COMPUTER PROCESSED. The computers have continued to work and automatically generate, based on data in the system, of amounts shown due. If you electronically filed your return and then mailed in the payment there may not have been anyone to pair the payment with the tax return. Or, in the case of one client, the check had the spouse’s social security number on the check and the computer could not pair it with the correct return.

Luckily for most this may be a mere inconvenience and a momentary loss of breath as they contemplate IRS Agents swooping down to take their last penny. If you owe and have not paid or requested an installment agreement you can go to the IRS site and pay via direct pay through checking or savings or set up a payment agreement. Setting up a payment agreement stops penalties and garnishments and can be made for as long as 72 months. Interest continues to accrue. If you paid, and your check was cashed then it may be just a pairing of return to a payment that is needed. If your payment has not been processed, you can stop payment of the check and pay via the Direct Pay portal or on the IRS2Go app. Afterward, contact the Service to request the removal ( abatement) of penalties or interest if you can prove you timely mailed in your payment.

As of March 2020, there is a temporary hold on providing The Service financial information before the acceptance of the installment agreement if the amount due is LESS THAN $250,000. You can also combine a multiyear balance due IF you are under an automatic debit agreement ( drafts each month from your banking institution). You may call 800-829-1040 or go to IRS.GOV to set the payment plan up.

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