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From $55k to Nothing Owed

October 25, 2023 | Written by: Kaylie J.
Smiling woman on the phone and taking notes.

In August of 2021, Dave was teleworking from home and decided to check his mail during his lunch break, when he noticed he had received a letter from the IRS. Puzzled as to why he would receive such a letter, he ripped open the envelope – and his eyes went straight to the amount he owed: over $55,000! There was no way he could come up with that kind of money! Deciding that he was in no state to return to work after his lunch, he contacted his boss and got the rest of the day off. Once he could calm himself down, he looked at the notice again. On his second inspection, Dave saw that he received a CP11 because the IRS believed there was a miscalculation on his 2020 return. Since Dave now understood why he was being audited, he pulled out his computer and logged into TurboTax. He downloaded and printed off his 2020 tax return and began to review the pages. While doing his second review of the full return, he couldn’t find the miscalculation. He even referenced the documents and resources he used when filing this return; it all appeared to be correct. Fortunately, once he got to the final page of his return, Dave saw that he paid for audit defense through TaxAudit.  

After an initial wave of relief that he didn’t have to deal with this audit alone, Dave immediately gave us a call and was connected with Luke, one of our Customer Service Representatives. Luke gave him instructions on how to send in a copy of his notice and the corresponding tax return. He then told him what the process would look like and what to expect next: he would be assigned a Tax Professional to assist him with this case. After this initial call with Luke, Dave felt better about the whole process, knowing he would have proper assistance moving forward. A few days later, he received a call from his Tax Professional, Bistra, who wanted to know more about Dave’s unique tax situation. After Bistra checked the tax return and asked Dave a few questions, she came to the conclusion that this notice was a computer-generated error because the IRS was trying to tax his charitable donations. However, per the CARES Act in 2020, taxpayers were permitted an allowance of up to 100% of a taxpayer’s adjusted gross income to be donated in 2020. After Bistra identified this issue, she immediately prepared a response and shipped it to the IRS in no time!  

Unfortunately, due to the pandemic in 2020, the IRS was months behind in processing and responding to documentation. However, Bistra was motivated, thorough, and attentive, and she continued to work on this case and updated Dave every step of the way. Dave was thankful for the constant communication and dedication; he let Bistra know that he appreciated her hard work on his case.  

Weeks turned into months, but Bistra persisted, continuing to send the IRS follow-up documentation, and making phone calls to check on the status. Sadly, before the case could reach a resolution, Dave passed away, and the executor of his estate, Ryan, reached out to Bistra to check on the status of the case. Bistra first extended her condolences for Ryan’s loss and caught him up on the situation—the case was still waiting for a proper response from the IRS. Ryan conveyed that, to close Dave’s estate, he would like the case to be closed as quickly as possible. Bistra continued her above-and-beyond efforts on the case, maintaining constant communication with the IRS and Ryan. Even with Bistra's best efforts, however, because of the slow response times by the IRS, this cycle continued for almost another year. During that time, Bistra continued to investigate different channels in an effort to expedite the case. She was able to make contact with someone at the Taxpayer Advocate Service and less than a week later, the case was resolved!  

This case was difficult for both parties involved. However, the case was eventually closed. Our dedicated and motivated tax professional, Bistra, worked tirelessly and utilized every resource available to provide the best possible outcome for our members. She managed to reduce the notice from $55,000 to zero, which was a great relief for her after all her hard work. 

*Some names and identifying details have been changed to protect the privacy of the individuals. 

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