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Simple Tax Return Mistakes Can Create a Large Tax Bill

December 13, 2022 | Written by: Courtney V.
Man talking on the phone with letter
Last October, Michael received a letter from the IRS. His eyes widened as they raced across the paper, and he began to understand what it was. The letter was a CP11 notice stating that the IRS had found some mistakes in his 2021 tax return, and he owed them over $5,000. As he continued to read on, the notice explained some of the issues found within Michael’s tax return.

First, the CP11 noted that Michael’s (or his spouse’s) social security number was either missing or incomplete. It also stated that Michael, or someone in his family, didn’t have an assigned ITIN (Individual Taxpayer Identification Number) by the due date of the tax return. As a result, the IRS had disallowed certain Child Tax Credits claimed on the return. To make things worse, the due date for the hefty $5,000 payment was just one month away.

After taking a few minutes to let this daunting information sink in, Michael remembered that he had purchased an Audit Defense membership while filing his taxes through TurboTax that year. He reached out to TaxAudit’s customer service team and was promptly paired with a Case Coordinator. The Case Coordinator walked Michael through the process of uploading his 2021 tax return along with the notice Michael had received from the IRS. Once he had sent in all the necessary documents, Michael was ready to be assigned to a Tax Professional.

Just a few days after uploading the documents, Michael was introduced to his Tax Professional, Jason. After thoroughly examining the documents and closely evaluating his case, Jason explained to Michael what had gone wrong.

One issue was that Michael had filed his return after the due date without filing for an extension. Second, Michael’s daughter had received her social security number after the due date, so it was not valid for use on the 2021 return. When Michael filed his return, he used the invalid social security number for his daughter instead of the valid ITIN. Additionally, while filing his return, he had marked that his son did not qualify for Child Tax Credit. These two mistakes affected what credits Michael’s tax return qualified for and resulted in him owing more money than he should have.

To work toward a resolution, Jason asked Michael to send him the valid social security and ITIN cards, along with his Record of Account Transcripts so he could review them. After doing so, he called the IRS on Michael’s behalf and provided the correct ITIN information for the daughter. He also worked with the IRS examiner to ensure that Michael’s son would qualify for Child Tax Credit. By correcting the mistake regarding the daughter's ITIN, and making the son eligible for Child Tax Credit, Jason was able to save Michael $2,000 from what the CP11 notice originally stated was due. The entire case took less than a month to resolve, and Michael was thrilled with the result and Jason’s diligent work with the IRS.

At TaxAudit, we strive to do whatever it takes to make sure that our members are only paying what is rightfully owed. If you are interested in learning more about an Audit Defense membership, click here!

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