My heart skipped a beat.
The letter from the Internal Revenue Service was sitting next to the microwave in my kitchen, nearly buried under a stack of junk mail. When I pulled it from the pile, I noticed it was a little thick, and that’s never a good sign. I was already worried and I hadn’t even opened the envelope. Why was the IRS sending my husband and me correspondence? We hadn’t filed our 2014 returns yet.
I opened the envelope and immediately focused on a line that said “the income and payment information we have on file from sources such as employers or financial institutions doesn’t match the information you reported on your tax return.”
Say what?
I could feel my heart rate go up with each paragraph.
The agency said, “If our information is correct, you will owe $12,255 (including interest and penalty), which you need to pay by April 15.” The letter was dated March 16.
The IRS compares what it receives on documents such as W-2s or 1099s with what people report on their income tax returns. My letter was generated as part of the agency’s “automated underreporter” program, which sends out notices if it appears that you haven’t reported income or that you miscalculated your tax payments, credits or deductions. When a discrepancy is found, the IRS sends you a proposal to adjust your return. It could result in additional tax owed or a refund.