02 Nov Stimulus “Math Error” IRS Notice
Now that the October 15th extension filing deadline has passed, many taxpayers are receiving notices stating they owe more taxes or they aren’t receiving the refund they thought they were. What did my Accountant do wrong?! Likely nothing, the adjustments are for many reasons the IRS computer program finds when it processes your return. For 2020, its mostly related to the Recovery Rebate Credit, or those wildly random COVID stimulus payments you got….
Why is there a math error?
Well, you may have entered the incorrect stimulus amount in your returns this year. Or, the amount you were eligible for based on your Adjusted Gross Income may now mean you owe some of that Rebate back (or you’re owed more!). Various reasons, some so obscure that your preparer nor TurboTax would foresee!
What can I do about a math error letter?
Call the IRS at (800) 829-8374 and review your account with a representative. You have 60 days to request an abatement for the amount owed. In that time, you can provide additional documentation to the IRS to explain why you shouldn’t have to pay. Be careful, this additional information is reviewed closely, and they may forward your case for audit. If you don’t contact the IRS within 60 days, you lose all rights to reverse the charges, but you can claim a refund after it’s paid.
But, good luck getting through to a representative, gross lack of resources and huge backlogs make it almost impossible. Review your return carefully or call your Accountant just to doublecheck. But be gracious and give your preparer time to review.
Ugh!
Right?! And next year, it’ll be worse. For 2021 returns, you’ll have to deal with another stimulus, state level funds and child tax credit advance payments. Be extremely detail oriented with your documentation, and timely file to beat the crowds. Of course, call Tax Defense Ohio to set up an appointment with one of our amazing accountants!
