Cryptic letter from the IRS.

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Topic Author
protagonist
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Cryptic letter from the IRS.

Post by protagonist »

I applied for an extension on my 2021 federal return in March 2022 and sent a check for what I owed in taxes plus $5000.

On April 11 I filed my 2021 return requesting my $5000 refund in I-bonds. For reasons I couldn't comprehend, according to the H+R Block software I used to do my return, the software would not let me e-file though it did not find any errors. I looked over the return carefully and could not figure out why...the error code was not helpful either. So I mailed my return (4/11/22).

I hadn't heard from the IRS until today and haven't received my refund.

Today I got a letter from the IRS stating:

"We received your Dec. 31,2021 Form 1040SR...but we need more information to process the return accurately".

It came with a demand for a copy of the first 3 pages of my return, amounts and dates of any estimated payments I made, and any supporting documents verifying income.

No mention was made as to what the issue was, but I sent everything they asked for by certified mail today. But it's nothing really different than what they should already have, I don't think.

Of course they are impossible to reach by phone, and there is no meaningful info on "Where's my Refund?" online....it just says I don't owe anything when I go to my irs.gov page.

Has anybody else received a similar letter?

Any ideas what this might be all about?

I don't want to have to wait another 6 months to receive another cryptic letter and still be out my $5000 refund.

Thanks.
MrDrinkingWater
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Re: Cryptic letter from the IRS.

Post by MrDrinkingWater »

Maybe you qualified for some pandemic-related economic payment that you did not think you were qualified to receive? The IRS may want to help you complete your 1040-SR correctly. If you are married and your spouse is over 65, you could file 1040-SR even if you aren't over 65.
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celia
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Re: Cryptic letter from the IRS.

Post by celia »

The letter sounds clear to me. By reading the thread title, I was expecting a letter using hieroglyphics, such as a strange font was accidentally used.

It sounds to me like they are trying to comfirm you pre-paid most of your tax liability through withholdings or estimated tax payments but they may not be seeing all the pieces you claimed were already paid.

Add up all the tax withholdings on the income tax forms you received, credits of excess taxes withheld and carried over from the previous year (if any), and your estimated taxes you paid quarterly (if any) to see if it matches the amount you claimed. They could also be checking that you withheld properly throughout the year since it might be unusual to get a large lump sum at the end. (See Form 2210 to understand my last sentence.)
Raycpact
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Re: Cryptic letter from the IRS.

Post by Raycpact »

The reason you couldn't efile may be because someone efiled using your number or when you thought you were extending you actually filed.

Either way they may have two filings and are trying to figure out which filing is right.
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Kevin M
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Re: Cryptic letter from the IRS.

Post by Kevin M »

I have not got a letter like that.

I was unable to e-file for a friend of mine a couple of years ago. I had him double-check his previous year tax, which is required to e-file, and it was correct. He mailed his return that year. Had the same problem for 2021, but what I finally tried was leave the last year tax blank (or $0), and then was able to e-file.

Was your check cashed?

My IRS account shows my payment history, including tax payments and estimated tax payments, but all of these are electronic payments (from our checking account). The payment history shows my 9/12/22 estimated tax payment, so is up to date for me.

Kevin
If I make a calculation error, #Cruncher probably will let me know.
placeholder
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Re: Cryptic letter from the IRS.

Post by placeholder »

Raycpact wrote: Tue Sep 20, 2022 6:45 pm The reason you couldn't efile may be because someone efiled using your number or when you thought you were extending you actually filed.

Either way they may have two filings and are trying to figure out which filing is right.
If someone already filed you get a code for that when your efile is rejected.
RubyTuesday
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Re: Cryptic letter from the IRS.

Post by RubyTuesday »

Check your transcripts at irs.gov
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tunafish
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Re: Cryptic letter from the IRS.

Post by tunafish »

Why did you not contact the software company and ask for an explanation of the error code, not that it would necessarily help the current state of things.
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nisiprius
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Re: Cryptic letter from the IRS.

Post by nisiprius »

"No mention was made as to what the issue was, but I sent everything they asked for by certified mail today. But it's nothing really different than what they should already have, I don't think."

You did the right thing, which is to keep calm, patiently jump through whatever hoops the IRS asks you to jump through, and help the overworked IRS employees check off whatever boxes they think they need to check off. Try not to get upset if it is unnecessary, repetitive, or stupid. Try not to get upset at brusque or curt language in the material they send you. If there is no real problem, the quickest way to resolve the situation is to help them do their job by providing them exactly what they ask for, in the exact form they are asking.

(I was once very annoyed by a letter that said they had found "an error" in my return because two entries were both exactly $2,000. One was $2,000 because that was a cap on what could be entered in that box, and the other was $2,000 because by sheer coincidence that particular entry happened to be a round $2,000. I sent a letter explaining that and they accepted it, but I'm still steaming that the computer-printed letter used the word "error" when I hadn't made one).

The time lag on finding out if the IRS is satisfied could be many months.

During the height of the pandemic in 2020, because of a technicality I had to file on paper, and my refund was delayed many months, I'm thinking maybe seven or eight. When I received the refund, they paid me interest based on the delay. If your payment is delayed a long time I hope you get interest, too.
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Topic Author
protagonist
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Re: Cryptic letter from the IRS.

Post by protagonist »

Kevin M wrote: Tue Sep 20, 2022 6:56 pm Had the same problem for 2021, but what I finally tried was leave the last year tax blank (or $0), and then was able to e-file.

Was your check cashed?


Kevin
That's interesting, Kevin.
Yes, my check was cashed.
Using H+R Block, I saved a lot of time by uploading my previous year's data file.
When you say you left the last year's tax blank, can you explain how you did that? Did you not load the data from the previous year (2020) into the software?
I'm asking for when I do my 2022 return next year, if I have the same problem.
Topic Author
protagonist
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Re: Cryptic letter from the IRS.

Post by protagonist »

nisiprius wrote: Wed Sep 21, 2022 7:25 am "No mention was made as to what the issue was, but I sent everything they asked for by certified mail today. But it's nothing really different than what they should already have, I don't think."

You did the right thing, which is to keep calm, patiently jump through whatever hoops the IRS asks you to jump through, and help the overworked IRS employees check off whatever boxes they think they need to check off. Try not to get upset if it is unnecessary, repetitive, or stupid. Try not to get upset at brusque or curt language in the material they send you. If there is no real problem, the quickest way to resolve the situation is to help them do their job by providing them exactly what they ask for, in the exact form they are asking.

(I was once very annoyed by a letter that said they had found "an error" in my return because two entries were both exactly $2,000. One was $2,000 because that was a cap on what could be entered in that box, and the other was $2,000 because by sheer coincidence that particular entry happened to be a round $2,000. I sent a letter explaining that and they accepted it, but I'm still steaming that the computer-printed letter used the word "error" when I hadn't made one).

The time lag on finding out if the IRS is satisfied could be many months.

During the height of the pandemic in 2020, because of a technicality I had to file on paper, and my refund was delayed many months, I'm thinking maybe seven or eight. When I received the refund, they paid me interest based on the delay. If your payment is delayed a long time I hope you get interest, too.
Thanks.
I'm calm as a cucumber (I never used that expression before, btw, but it's pretty funny). Anger serves no purpose when it comes to things that one cannot change.
That said, my $5000 in "would-be" I-bonds could be earning 9.62% interest right now.
I assume it will be sorted out at some point...hopefully before the end of the decade. It's just a lot of hassle, and they are impossible to reach by phone (several times I have gone through a long menu, only to be told they are too busy to take my call and to call back later).
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Kevin M
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Re: Cryptic letter from the IRS.

Post by Kevin M »

protagonist wrote: Wed Sep 21, 2022 9:28 am
Kevin M wrote: Tue Sep 20, 2022 6:56 pm Had the same problem for 2021, but what I finally tried was leave the last year tax blank (or $0), and then was able to e-file.

Was your check cashed?


Kevin
That's interesting, Kevin.
Yes, my check was cashed.
Using H+R Block, I saved a lot of time by uploading my previous year's data file.
When you say you left the last year's tax blank, can you explain how you did that? Did you not load the data from the previous year (2020) into the software?
I'm asking for when I do my 2022 return next year, if I have the same problem.
HR Block loads your last year tax as the default, buy you can change it. I can't remember exactly, but I think I did a web search and found this as a solution, and it worked for me.
If I make a calculation error, #Cruncher probably will let me know.
Topic Author
protagonist
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Re: Cryptic letter from the IRS.

Post by protagonist »

Kevin M wrote: Wed Sep 21, 2022 12:22 pm
protagonist wrote: Wed Sep 21, 2022 9:28 am
Kevin M wrote: Tue Sep 20, 2022 6:56 pm Had the same problem for 2021, but what I finally tried was leave the last year tax blank (or $0), and then was able to e-file.

Was your check cashed?


Kevin
That's interesting, Kevin.
Yes, my check was cashed.
Using H+R Block, I saved a lot of time by uploading my previous year's data file.
When you say you left the last year's tax blank, can you explain how you did that? Did you not load the data from the previous year (2020) into the software?
I'm asking for when I do my 2022 return next year, if I have the same problem.
HR Block loads your last year tax as the default, buy you can change it. I can't remember exactly, but I think I did a web search and found this as a solution, and it worked for me.
Ah...so just don't load last year's data and enter everything manually instead?
I hope that works. I didn't have a problem prior to 2021. I'll give that a try next year.
Thanks!
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Kevin M
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Re: Cryptic letter from the IRS.

Post by Kevin M »

protagonist wrote: Thu Sep 22, 2022 10:11 am
Kevin M wrote: Wed Sep 21, 2022 12:22 pm
protagonist wrote: Wed Sep 21, 2022 9:28 am
Kevin M wrote: Tue Sep 20, 2022 6:56 pm Had the same problem for 2021, but what I finally tried was leave the last year tax blank (or $0), and then was able to e-file.

Was your check cashed?

Kevin
That's interesting, Kevin.
Yes, my check was cashed.
Using H+R Block, I saved a lot of time by uploading my previous year's data file.
When you say you left the last year's tax blank, can you explain how you did that? Did you not load the data from the previous year (2020) into the software?
I'm asking for when I do my 2022 return next year, if I have the same problem.
HR Block loads your last year tax as the default, buy you can change it. I can't remember exactly, but I think I did a web search and found this as a solution, and it worked for me.
Ah...so just don't load last year's data and enter everything manually instead?
I hope that works. I didn't have a problem prior to 2021. I'll give that a try next year.
Thanks!
No! Load last years data, for sure, since that makes completing the return much easier. When you get to the filing screen where you need to verify last year's AGI or tax or whatever it is, replace the default imported from last year's return with blank or zero (can't remember which one worked, but maybe it doesn't matter). I would try doing it with the default number imported from the previous year's return first, and if that doesn't work, try the blank or zero.
If I make a calculation error, #Cruncher probably will let me know.
Asyouwish
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Re: Cryptic letter from the IRS.

Post by Asyouwish »

The prior year AGI is used for security/identification. If the return was processed before November, the IRS should have the AGI. If the return gets delayed beyond late November, then the AGI is not in the system. That’s when you use zero/blank. It doesn’t mean your return doesn’t exist, it just means the AGI was recorded too late and is not available for efile verification purposes. November is the time of year efile gets shut down temporarily and doesn’t reopen until January sometime. By January, they have prepared for the new tax year.

See validating your return here. https://www.irs.gov/individuals/electro ... in-request

There could be other reasons efiling is not available due to certain tax forms not being supported for efile. If that’s the case, nothing will help and paper filing is a must.
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Kevin M
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Re: Cryptic letter from the IRS.

Post by Kevin M »

Asyouwish wrote: Thu Sep 22, 2022 1:20 pm The prior year AGI is used for security/identification. If the return was processed before November, the IRS should have the AGI. If the return gets delayed beyond late November, then the AGI is not in the system. That’s when you use zero/blank. It doesn’t mean your return doesn’t exist, it just means the AGI was recorded too late and is not available for efile verification purposes. November is the time of year efile gets shut down temporarily and doesn’t reopen until January sometime. By January, they have prepared for the new tax year.

See validating your return here. https://www.irs.gov/individuals/electro ... in-request

There could be other reasons efiling is not available due to certain tax forms not being supported for efile. If that’s the case, nothing will help and paper filing is a must.
The return for which I had the issue two years running was filed in March. The AGI was in their system, as verified on the irs.gov account, but for some reason they still wouldn't accept it with the AGI filled in the tax software. Maybe the system used for verification is different than what we see in our irs.gov accounts?

Note that this is the only one of many, many tax returns I have submitted electronically over many years, and for which I had this problem, and in this case, the previous year return had been filed on paper both years I had the problem. Since we were able to file the last return electronically with the work around, I assume we won't have this problem for the 2022 return.
If I make a calculation error, #Cruncher probably will let me know.
FireAway
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Re: Cryptic letter from the IRS.

Post by FireAway »

I received a similar letter this year, after efiling but before receiving my refund. While digging up payment info, etc. I found that I had made a pretty substantial estimated tax payment in Q3, then completely forgotten I had paid it (!!!) and not included it when filing my taxes. So, in addition to the info the IRS asked for, I included a cover letter stating that I had just noticed this mistake, that the IRS in fact owed me much more money in refund than I had indicated on my return, and asking their advice as to whether I should immediately file an amended return or what. Without further comment they just promptly issued my refund - for the corrected amount - including the $5K in ibonds I had requested.

So in my case it was just a discrepancy - on the payments side, and in my favor - between the information they already had, and what I stated on the return.
MarkNYC
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Re: Cryptic letter from the IRS.

Post by MarkNYC »

I'll offer a guess about the cause of the problem. Since the tax return was filed prior to April 15th and it showed an extension payment, perhaps that caused an efile rejection or an IRS processing issue, or both. You wouldn't think that would create a problem but it's an unusual fact pattern, so maybe.
donaldson
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Re: Cryptic letter from the IRS.

Post by donaldson »

MarkNYC wrote: Thu Sep 22, 2022 3:08 pm I'll offer a guess about the cause of the problem. Since the tax return was filed prior to April 15th and it showed an extension payment, perhaps that caused an efile rejection or an IRS processing issue, or both. You wouldn't think that would create a problem but it's an unusual fact pattern, so maybe.
This could very well be possible.

Also, if the e-file gets rejected during the prior year AGI verification process, there are often instructions in the provider's help topics on how to handle different situations.

For example, I had to paper file for 2020 due to needing to send a specific document with wet signatures, and when e-filing the 2021 return in TaxAct, it kept getting rejected. Eventually I learned from the TaxAct help section that I needed to mark the option that said I did not file a 2020 return, and it was accepted. Other e-file providers or other situations might call for putting $0 in the prior year AGI field, as Kevin M mentioned.
Topic Author
protagonist
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Re: Cryptic letter from the IRS.

Post by protagonist »

Kevin M wrote: Thu Sep 22, 2022 12:49 pm
protagonist wrote: Thu Sep 22, 2022 10:11 am
Kevin M wrote: Wed Sep 21, 2022 12:22 pm
protagonist wrote: Wed Sep 21, 2022 9:28 am
Kevin M wrote: Tue Sep 20, 2022 6:56 pm Had the same problem for 2021, but what I finally tried was leave the last year tax blank (or $0), and then was able to e-file.

Was your check cashed?

Kevin
That's interesting, Kevin.
Yes, my check was cashed.
Using H+R Block, I saved a lot of time by uploading my previous year's data file.
When you say you left the last year's tax blank, can you explain how you did that? Did you not load the data from the previous year (2020) into the software?
I'm asking for when I do my 2022 return next year, if I have the same problem.
HR Block loads your last year tax as the default, buy you can change it. I can't remember exactly, but I think I did a web search and found this as a solution, and it worked for me.
Ah...so just don't load last year's data and enter everything manually instead?
I hope that works. I didn't have a problem prior to 2021. I'll give that a try next year.
Thanks!
No! Load last years data, for sure, since that makes completing the return much easier. When you get to the filing screen where you need to verify last year's AGI or tax or whatever it is, replace the default imported from last year's return with blank or zero (can't remember which one worked, but maybe it doesn't matter). I would try doing it with the default number imported from the previous year's return first, and if that doesn't work, try the blank or zero.
Thanks!
JEC
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Re: Cryptic letter from the IRS.

Post by JEC »

protagonist wrote: Tue Sep 20, 2022 5:38 pm I applied for an extension on my 2021 federal return in March 2022 and sent a check for what I owed in taxes plus $5000.

On April 11 I filed my 2021 return requesting my $5000 refund in I-bonds. For reasons I couldn't comprehend, according to the H+R Block software I used to do my return, the software would not let me e-file though it did not find any errors. I looked over the return carefully and could not figure out why...the error code was not helpful either. So I mailed my return (4/11/22).

I hadn't heard from the IRS until today and haven't received my refund.

Today I got a letter from the IRS stating:

"We received your Dec. 31,2021 Form 1040SR...but we need more information to process the return accurately".

It came with a demand for a copy of the first 3 pages of my return, amounts and dates of any estimated payments I made, and any supporting documents verifying income.

No mention was made as to what the issue was, but I sent everything they asked for by certified mail today. But it's nothing really different than what they should already have, I don't think.

Of course they are impossible to reach by phone, and there is no meaningful info on "Where's my Refund?" online....it just says I don't owe anything when I go to my irs.gov page.

Has anybody else received a similar letter?

Any ideas what this might be all about?

I don't want to have to wait another 6 months to receive another cryptic letter and still be out my $5000 refund.

Thanks.
CPA here. Probably saw 25 or so of those letters this year. Nothing to worry about. Yes, I understand it's strange that they are asking for info they already have in their system, but this is mostly to confirm it's you filing the return/requesting the refund. Don't be surprised if you experience a pretty substantial delay receiving your refund.
Topic Author
protagonist
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Re: Cryptic letter from the IRS.

Post by protagonist »

JEC wrote: Fri Sep 23, 2022 2:34 pm
protagonist wrote: Tue Sep 20, 2022 5:38 pm I applied for an extension on my 2021 federal return in March 2022 and sent a check for what I owed in taxes plus $5000.

On April 11 I filed my 2021 return requesting my $5000 refund in I-bonds. For reasons I couldn't comprehend, according to the H+R Block software I used to do my return, the software would not let me e-file though it did not find any errors. I looked over the return carefully and could not figure out why...the error code was not helpful either. So I mailed my return (4/11/22).

I hadn't heard from the IRS until today and haven't received my refund.

Today I got a letter from the IRS stating:

"We received your Dec. 31,2021 Form 1040SR...but we need more information to process the return accurately".

It came with a demand for a copy of the first 3 pages of my return, amounts and dates of any estimated payments I made, and any supporting documents verifying income.

No mention was made as to what the issue was, but I sent everything they asked for by certified mail today. But it's nothing really different than what they should already have, I don't think.

Of course they are impossible to reach by phone, and there is no meaningful info on "Where's my Refund?" online....it just says I don't owe anything when I go to my irs.gov page.

Has anybody else received a similar letter?

Any ideas what this might be all about?

I don't want to have to wait another 6 months to receive another cryptic letter and still be out my $5000 refund.

Thanks.
CPA here. Probably saw 25 or so of those letters this year. Nothing to worry about. Yes, I understand it's strange that they are asking for info they already have in their system, but this is mostly to confirm it's you filing the return/requesting the refund. Don't be surprised if you experience a pretty substantial delay receiving your refund.
Thanks! (it's already a "pretty substantial delay", by the way.....).

Though I have taken a $5000 refund in I-bonds for several years running without serious issues, I am wondering if this is the new reality. And if so, if it is worth doing in the future. The IRS has already been sitting on my $5K for over 6 months with no end in sight. I fully expect to get my refund at some point, but it hardly seems like it is worth the effort.
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