What Do I Need To Know About Letter 4903?
Letter 4903 (LT 26) is a notice issued by the IRS warning you that the agency has no record of receiving your federal tax returns for a certain duration of time, according to TaxHelpAudit.com. LT 26 explains that previous requests to file the returns have gone without responses. Unless you file the returns or contact the IRS as soon as possible, the IRS may file the return for you.
Why Did I Receive This?
You may have received this letter because of capital gain, self-employed income or you reported excess deductions to the IRS without income. It’s a notification that the government believes you’re not current on your obligatory tax filing. If you don’t take action to file the returns, the IRS will prepare a Substitute Return and file on your behalf.
What Do I Do Now?
You’re being informed because the government believes you owe taxes. If you did file taxes, it may just be easier to re-file your taxes, rather than fight the claim. You can argue the unknown tax return record with proof of the filing and date, such as the certified mailing receipt or postal date stamp verification. Keep in mind electronic filing can help mitigate the issue of no record of receiving tax returns.
Should I Contact the IRS?
Call the IRS immediately if your don’t agree with the notice or don’t have the requisite records to complete the return. The IRS explains that the agency can usually provide income and withholding information for wage earners. The Office of the Taxpayer Advocate is also available for taxpayers who have called the IRS to rectify the problem, and it went uncorrected. The number to call is printed at the top of the notice. Make sure to call in a timely manner. You have 10 days following the date on the letter to address the issue. It’s your responsibility to either provide a copy of the return or contact the IRS for more details about the situation. For example, you may request more time to file the return if a tax professional was supposed to e-file the return, and you’re without a valid copy, explains TaxesWillTravel.com.
What if I Ignore the Notice?
The IRS may file your return for you, which means the tax liability could be higher than a return filed by you, according to IRS.gov. A voluntarily filed return by the taxpayer is more likely to “reflect a lower net tax and/or a higher refund amount” than a return filed by the government, explains an IRS FAQ.
Should I Get Professional Assistance?
A tax specialist may be beneficial for further researching of the issue and gathering of the right information, especially if you believe you don’t owe or misplaced necessary documents. By not paying owed taxes, you’ll likely get hit with a high penalty and interest. To prevent this from happening in the future, taxpayers, especially those who are self-employed, should maintain proper and updated financial records with organized accounting and bookkeeping preparation. Further information can be found here:
Before making any tax decision, enlist the support of a tax professional. Enroll in financial literacy programs or use the plethora of financial education resources available to improve your financial capabilities.