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Interpreting Letters from the IRS & Other Taxing Authorities
Today I went to the Colorado Department of Revenue to help a client who has received letters stating that they owe money to the state for the past 3 years. I went down there because I thought it would give me some understanding and closure regarding the case. There seemed to be many other invididuals equally confused at the Colorado Department of Revenue.
In regards to my client’s case, the state of Colorado claimed that my client only made 3 of the 4 required payments to the state and penalized them for nonpayment, even though my client and I sent the state a copy of their missing payment about a year ago. As it turns out, the state applied my client's estimated payment to 2009, instead of where it belonged in 2010. The state should have realized this, as the final payment was an odd amount of money identical to the other 3 payments they had accepted for 2010, and was submitted on time. Instead, the state of Colorado sent my client a check back because they did not owe money for 2009, and my client cashed it without letting me know.
My trip to the Colorado Department of Revenue was successful because I explained to my client exactly what had happened and what we needed to do to fix it. Many Denver taxpayers receive a letter from the IRS or other taxing authority (the IRS sends out millions every year) and have no idea what it says, except that they owe money. Many of these people pay the money because they don’t know what else to do.
One of the Denver accounting services that Bloch, Rothman and Associates, Ltd. provides to clients is the correct handling of this type of IRS or tax authority correspondence. Our Denver accountants have been handling these types of letters for decades and can figure out exactly what they mean and what has to be done to lower or eliminate your bill with them. The IRS reports that about 30% – 40% of these initial letters are wrong, yet many people pay them, simply to keep the authorities away from them.
If you receive one of these letters from the IRS or other tax authority, our Denver accountants at Bloch, Rothman and Associates, Ltd. can help you interpet it. Please call us for a free consultation; we will let you know what the letter is about, along with the best and cheapest way to handle it.