The Notice of Deficiency comes from the IRS through either registered or certified mail. This is a very important notice and it comes with a 90 day notice of your rights. This is why many tax attorneys call this the "90 day letter." It is also known as Letter 531 and CP 531. While you might think that nothing good ever comes registered or certified mail, how you handle this letter might be the first steps towards solving your tax problem.
I am a tax attorney in Minneapolis, Minnesota. I represent taxpayers before the IRS and state tax authorities all over the country. I help with tax debts, audit defense, payroll tax issues, and criminal tax matters. The Notice of Deficiency is one of those IRS notices that you don't want to ignore.
Many taxpayers don't even open their mail; especially when that mail is from the IRS. You know that the government wants money from you, but, since you can't pay them in full, you put the letter in a drawer unopened. Something to take care of another day. The Notice of Deficiency gives you notice of certain rights that you must exercise within 90 days.
In the upper right hand corner of the notice, you'll see a sentence that says "Last day to file petition in US Tax Court." That is just as important as it sounds. Once this deadline passes you lose many rights. You will have to exercise your rights within the 90 days or you'll lose them. If you ignore this notice not only are your rights lost, but the IRS will begin its collection efforts in earnest.
This means that levies and tax liens are on the table. You receive this notice potentially as the result of an audit. This is how the IRS assesses tax after the audit. Another way that you can receive this notice is because you were previously sent a 30 day notice and you didn't respond. This might be another one of those letters that ended up in your desk drawer unopened. You want to act quickly once you receive this notice and exercise your rights. Hiring a tax attorney might be necessary.
Attorney at Law
12800 Whitewater Dr.
Minnetonka, MN 55343