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The IRS is sending incorrect notices of tax delinquency

On Behalf of | Mar 1, 2021 | Federal And State Tax Collections |

Have received a notice from the IRS that they haven’t received your federal return? If you filed, you may have received that notice in error. You see, the IRS is still catching up on its unprocessed mail from the pandemic. Currently, there are more than 11 million unprocessed individual and business tax returns sitting around at IRS offices.

The problem is that many IRS employees are working from home during the pandemic, or not working at all. Meanwhile, the agency has processed two rounds of quick-turnaround economic stimulus payments for millions of taxpayers at the same time it was supposed to be processing those returns.

The IRS has admitted the delinquency notices were sent in error and posted a statement on its website saying that they can be disregarded. The statement applies to at least 260,000 taxpayers who were sent CP59 delinquency notices saying they had failed to file their 2019 returns.

The agency has made clear that taxpayers who have, indeed, filed their 2019 returns can completely disregard the CP59 notices. There is no need to call the IRS or respond in any way. The agency is working to process 2019 returns as quickly as it can.

If you haven’t filed your 2019 taxes, you should do so immediately.

This isn’t the first time the IRS has sent out inaccurate collection notices. Last year, it sent about 1.5 million balance-due notices that had incorrect dates. Also last year, notices were also sent to many taxpayers claiming that they had not made required payments. In reality, many of the taxpayers had paid on time but the payments remained unopened due to the mail backlog. And, in October, the IRS sent erroneous revocation notices to over 30,000 tax-exempt organizations.

Members of Congress have harshly criticized the agency for these errors.

“In light of these severe processing delays, it is very likely that many taxpayers receiving CP59 notices already filed the returns that the IRS claims are outstanding,” wrote two House Ways and Means Committee members in a letter to the IRS commissioner.

“For taxpayers who have dutifully complied with their filing obligations, these notices impose unnecessary stress and sow confusion. For IRS employees, these notices create unnecessary work while they struggle to meet the current demand.”

If the IRS is unsure whether a taxpayer has filed and/or paid their taxes, it should not send out a delinquency notice or other communication. However, it is happening.

If you are unsure whether you have met your tax obligations and receive a notice from the IRS, talk to an experienced tax attorney.