CAN THE IRS MAKE A MISTAKE?
Apparently, the answer is yes. A client received a letter from the IRS recently and forwarded it on to this office. The IRS claimed that several calculations were made incorrectly on the tax return and requested that the taxpayer pay a modest amount of additional tax.
Some taxpayers who receive such a letter might conclude that the IRS was correct, the amount was small and therefore not worth bothering calling the office of the CPA who prepared the return.
This client did not do that. The letter was sent to us and I called the IRS number on the letter. At the first level, the screener decided that this was a matter that needed to be forwarded to another specialist. The specialist was very courteous and asked for specific information from the letter and tax return which was supplied. Almost immediately, the specialist indicated that the IRS was having trouble with their computer. They had not been able to fix the problem, but it was apparent that their letter was bogus. The specialist went off-line for about 15 minutes and then returned to inform me that the original calculations in the return were correct and the IRS had made a mistake. The client will be sent a letter in 2-3 weeks correcting the IRS error.
Unfortunately, the IRS only responds to inquiries. They are not determining whose returns were affected by this problem.
In any case where you receive a letter changing your tax liability, please do not hesitate to send it to me for validation. There is no charge for this review.