Dealing with the IRS

Jim Buttonow, CPA CITP

Updated on: November 4, 2024

Key Facts

Each year, about 43% of all taxpayers (70 million taxpayers in total in 2017) must interact with the IRS outside of filing a tax return. There are three major areas of inquiries to the IRS:

Tax laws questions to determine how they apply to the taxpayer’s circumstances
Information about their account, such as payments/refund status, compliance status, amended return status, and copies of returns or transcripts
Respond or get information about a tax notice or problem, such as a penalty, unfiled return, unpaid balance, or an audit

Solutions

Getting Your IRS Records and Information

Taxpayers have four choices in getting their information from the IRS: call, write, or visit the IRS – or use a tax professional to intervene. Currently, the IRS does not answer tax law interpretation questions. Taxpayers are left to research their question or get a professional opinion from a CPA or other tax professional. Taxpayers who need information about their account can call or visit the IRS. If they want tax records, they can ask for their IRS transcripts (electronic records of their account, tax return info, and W-2s/1099s filed under their taxpayer identification number.)

It is difficult for taxpayers to understand IRS transcripts and get answers about their account, notices they receive, and any issues they have regarding penalties, filing errors, and owing back taxes. It is also difficult for taxpayers to get in contact and speak with an IRS person about their situation. The IRS pushes most taxpayers to get their questions answered on the IRS website. Tax professionals have a special hotline that they can contact (called the Practitioner Priority Service) that they can use to get complete answers to taxpayer’s questions.

Resolving Tax Problems

Taxpayers have two options to resolve a problem: deal with the IRS directly or hire a tax professional who can represent you before the IRS. Whether you go it alone or hire a tax pro, you will need to follow specific steps to resolve the issue(s).

If you get a tax pro to help, you will need to authorize the person with a Form 2848, Power-of-attorney, to represent you before the IRS. States have similar forms. The authorized person needs to be a CPA, attorney, or an enrolled agent. The person who completed your tax return for the year and is a designated “Annual Filing Season Program” professional can also help with an audit, but no other issues with the IRS.

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