What to Do When You Get an IRS Notice

The short answer: do not ignore it

If you get a letter from the IRS, open it, read it, and check the deadline. Do not assume it is a mistake. Do not panic either. Many notices are about missing information, a balance due, identity checks, or a change the IRS made to a return.

Your first job is simple:
1. Confirm the letter is really from the IRS.
2. Find the tax year involved.
3. Find the response date.
4. Compare the notice to your tax return and records.
5. Decide whether you agree, disagree, or are not sure.

If you are not sure what the notice means, it is smart to talk to a licensed accountant, such as a CPA or IRS Enrolled Agent. BalancedRow is a free matching service. We help you connect with licensed accountants for tax preparation and related tax help. We do not give tax advice, prepare returns, or represent people before the IRS.

Before you share anything sensitive, verify the accountant's credential and PTIN yourself through the IRS Directory of Federal Tax Return Preparers or your state board of accountancy, and confirm the fee and scope in writing.

Also protect yourself: never send your Social Security Number, ITIN number, bank login, or tax documents to anyone you have not verified. BalancedRow only collects contact and request details for matching. We never ask for SSNs, ITIN numbers, financial-account numbers, or tax documents.

First, make sure the notice is real

Scam texts, emails, and phone calls often pretend to be from the IRS. A real IRS notice usually comes by mail and has a notice or letter number in the top or upper right area, plus tax year details.

Here are practical checks:
- Look for the notice number. Common examples start with CP or LT.
- Match the tax year and your name to your records.
- Read what action the IRS says it took or wants from you.
- Check whether it asks you to reply by mail, pay, or do nothing.
- Compare it to your copy of the return for that year.

Be careful with urgency. Scammers push fear and fast payment. The IRS does send real balance-due notices, but you should still verify before acting.

A few warning signs of fraud:
- A demand for payment by gift card, crypto, or wire only
- A threat of immediate arrest or deportation on the spot
- A message asking you to click a link and enter your SSN or bank login
- A caller refusing to let you verify the notice independently

If English is not your first language, slow down and get help reading the letter. That is normal. Many taxpayers, including new immigrants and ITIN filers, need someone to explain IRS language in plain English. You can ask to be matched through our immigrant and ITIN help page, then compare your options and choose who to hire.

How to read the notice and decide what it means

Not every IRS notice means the same thing. Some are informational. Some say you owe money. Some say the IRS changed your return. Some ask you to verify identity or send documents.

A good way to review it is to answer four questions:

1. What tax year is involved?
Sometimes people look at the wrong return. Make sure you pull the correct year.

2. What is the IRS saying happened?
Common examples:
- You have a balance due.
- The IRS changed items on the return because numbers did not match what third parties reported.
- The IRS wants identity verification.
- The IRS says it is holding a refund.
- The IRS needs supporting documents.
- The IRS applied a payment differently than you expected.

3. Do you agree, disagree, or need more time to understand?
If you agree, the next step may be payment or signing a response. If you disagree, you may need to write back with documents. If you are not sure, get a licensed CPA or EA to review it.

4. What is the deadline?
Deadlines matter. Missing one can limit your options or add interest and penalties.

If you run a business, pull your bookkeeping, payroll records, prior notices, and a copy of the filed return for that year. If your records are messy, a licensed accountant may need to help sort what was reported and what the IRS is challenging. Typical fee ranges vary by the work involved, your situation, the records you bring, and your area. As a rough guide, an hourly CPA may cost $150-$400 per hour, monthly bookkeeping often runs $150-$600 per month by volume, and a small-business tax return often falls around $500-$1,800. These are estimates, not quotes or guarantees.

What to do next, step by step

If the notice is real, use this checklist.

1. Keep the envelope and the full notice
The date matters. So do page numbers and response instructions.

2. Pull your records
Find:
- the tax return for that year
- W-2s, 1099s, K-1s, or business income records
- proof of payments made
- any earlier IRS letters
- relevant receipts or payroll records if you own a business

3. Write down the deadline and the issue
Use one sentence, like: "IRS says 2023 income on a 1099 was not reported" or "IRS says payroll deposit was late." This helps you stay focused.

4. Do not send original documents unless the notice says to
Send copies if needed. Keep a complete copy of anything you mail.

5. Reply the way the notice tells you to reply
Some notices say no response is needed if you agree. Others require a signed response or payment. Follow the notice instructions closely.

6. If you cannot pay in full, do not ignore the bill
The IRS may have payment options, but the right choice depends on your facts. A licensed CPA or EA can review the notice and your situation with you. BalancedRow can help you get matched with licensed accountants. We do not give tax or legal advice.

7. If you disagree, organize your proof
Keep it clean and simple:
- a short cover letter
- a copy of the notice
- copies of supporting records
- a timeline if the issue is confusing

8. If the notice is about a business, act quickly
IRS payroll and business tax issues can grow fast because penalties and interest may continue. If you need broader cleanup, you may also want help with small-business accounting.

When hiring help, ask these questions:
- Are you a CPA or IRS Enrolled Agent?
- What is your PTIN?
- Have you handled this kind of notice before?
- What is your estimated fee range, and what could make it higher?
- What exactly is included in the scope?

Then verify the credential yourself and get the fee and scope in writing before any work starts.

When to get licensed help right away

Some notices are simple. Others are not. It is wise to get licensed help soon if:
- the amount due is large for you or your business
- the IRS changed your return and you do not understand why
- the notice involves self-employment, a business return, payroll, or multiple years
- you lost records, moved, or think you missed earlier letters
- you are an immigrant or ITIN filer and are worried about making a mistake because of language barriers
- you think the IRS is wrong but you are not sure how to prove it

A licensed CPA or IRS Enrolled Agent can review the notice, explain what it appears to mean, and tell you what records they would need if you hire them. BalancedRow is free for readers because participating accountants pay a flat fee to be listed and matched. You compare options, verify credentials, and choose who to hire.

Typical tax-return pricing can help you set expectations if the notice leads to return review or correction work. An individual return often costs around $180-$500. A small-business return often costs $500-$1,800. More complex notice work may be billed hourly, often $150-$400 per hour for a CPA. Again, these are typical estimates only. The real fee depends on the work involved, your situation, the records you bring, and your area.

If you have never hired an accountant before, read how to choose an accountant. If you are confused about credentials, see the difference between a CPA, an EA, and other preparers in this guide.