In the normal course of business you will receive notices from various governmental entities. Many are standard type notices, informing you of tax rate changes, new laws, or confirming receipt of returns you’ve filed.
You will also receive notices regarding errors on your tax return filings, which usually result in additional tax owed, but occasionally a refund. In some cases you may receive a refund check you weren’t expecting.
In all cases, you must investigate the problem and then communicate with the entity that sent you the notice. These communications can be written or oral. I usually choose written communication if the issue requires detailed explanation and backup.
When writing a letter, keep these points in mind:
- Make it clear what notice you are responding to. Reference it on the line right above the greeting, for example re: Notice Number xxx;
- Restate briefly what their letter said. This should be done in a sentence or two. I also include the date of their letter in this part;
- Indicate your response – that you disagree with their findings, along with your reason. Include backup to show why yours is the correct position;
- Tell the entity what you want. You have to be crystal clear on this point. Since it is so direct, I like to include ‘respectfully request’ as part of the sentence. For example, ‘we respectfully request that the penalty be abated.’
- A helpful closing statement. Indicate that you are happy to provide any additional information needed to process the request. Include your phone number (even if it is also on the letterhead) to show that you are willing to discuss the issue further in the event of disagreement;
- Always include a thank you line, for example, ‘thank you for considering this request.’
- Enclose a copy of the notice as well as any backup you’ve referenced in the letter.
One final thought – if you receive a refund check you weren’t expecting, particularly from the IRS, don’t cash it right away. Call the issuer to see if they can provide more information. If you cash the check and it turns out it was issued in error, penalties and interest may be charged until the money is returned. It doesn’t seem fair, but I’ve had it happen. Of course you may be able to sweet talk your way out of it, but it doesn’t always work. Better not to put yourself in that situation at all.
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