Of all the seasons, tax season ranks generally low on the list of favorites for many people. The process involves many different forms full of complicated combinations of letters and numbers. Only a few people truly understand what to do with any of them. One such form is the IRS Letter 2645C. Receiving letters from the IRS can cause anyone’s heart to skip a beat, particularly after already filing taxes. This letter, however, may not be as discouraging as it appears on the surface. Understanding your IRS letter 2645C and its implications for your business can empower you to take the necessary next steps.

What Is an IRS Letter 2645C?

Classified as an inquiry letter, and sometimes referred to as an interim letter, it is simply a notification to a taxpayer that the IRS has received something. However, no action may have been taken yet. These letters, vague in nature, may not indicate what has been received. They merely state that they are going to review the document sometime within the next 60 days. Although it does not directly state it, the document will provide some information that may help taxpayers understand exactly what was sent. Documentation could be sent directly from you or a person authorized to do so. As an example, if copies of employment records are needed, and your employer needs to send them directly, it could be a letter that acknowledges that the IRS has received them.

The letter will list the following as potential types of information they may have received:

  • Correspondence
  • Telephone inquiry
  • Payment
  • Form
  • Response to our inquiry or notice
  • Penalty abatement request
  • Installment agreement
  • Other

In addition, the letter will state the date it originated. From that, you may be able to determine which specific document was received. The letters are harmless in nature and are generally mailed out in the hundreds of thousands each year. Often, these letters are an attempt at showing courtesy to the taxpayer. For the IRS, however, it usually means a further delay in processing documentation on an open case.

What Are My Next Steps After Receiving IRS Letter 2645C?

If you receive an interim letter, and you were expecting it, then there are no further steps other than to continue making payments as planned. Think of this letter as if you are on the phone and have been placed on hold. The letter will further state that there is no further action required at the time of the letter. The documentation sent may not have been processed yet. This is just an acknowledgement that it has been received.

Generally, the letter will acknowledge that contact will be made with the taxpayer, or their power of attorney, within 45 to 90 days for next steps. If you receive one of these letters, a good practice is to simply keep it with the rest of your tax documentation.

If you were not expecting this letter, you will want to review your tax account or contact the IRS for clarification. There may be times that you have been in communication with the IRS, but the case was resolved prior to the letter being sent. Some people report receiving refunds or next steps before receiving a 2645C. This can also heighten the feeling that the refund was incorrect. However, it could just be slow turnaround times at the IRS and not be further indicative of tax troubles.

Essentially, a 2645C is more of a formality and an attempt at communication with the taxpayer from the IRS. It is their way of saying, “We haven’t solved the problem, but we did receive something from you.” It can be frustrating and confusing, but it is not necessarily a precursor to any sort of further tax troubles.

FAQs

Q: Is IRS Letter 2645C an Audit Letter?

A: An IRS Letter 2645C is not a notice of audit. It is simply an acknowledgement that they have received documentation or information from a taxpayer or their authorized representative. The letter does not indicate the specific item received, and the IRS may not have processed the information yet. It is simply explaining that it is still reviewing the case and has added the item to the information for review.

Q: What Does My IRS Letter Mean?

A: The IRS sends notification letters for a multitude of reasons. Letters will always come via the United States Post Office. Examples of situations the IRS will send letters for include:

  • There is a balance due.
  • There is a change to your refund amount.
  • There is a question about your tax return.
  • Your identity needs to be verified.
  • There is additional information needed.
  • There are delays in processing a return.

Q: What Does It Mean When the IRS Says They Need an Additional 60 Days?

A: You might receive a notice from the IRS that states they need an additional 60 days to review your information. It could be for several reasons and does not indicate an audit is pending. At times, the IRS could see a delay in processing times. They might also simply need additional time to verify information in your tax return before processing any appropriate returns.

Q: What Is a “C” Notice From the IRS?

A: C notices are sent to taxpayers who misreport or underreport the interest and dividends earned from investments. Letters will be sent to the taxpayer. If the taxpayer fails to respond, a C letter will be issued. This authorizes payers, like banks and corporations, to withhold future interest from investments at a rate of 24%.

Tax Planning Attorneys in California

Taxes come with many complications, and not everyone employs tax professionals in their business. Do not allow the undue anxiety caused by tax season or letters from the IRS overwhelm you. Get the answers to your tax questions to keep your business running smoothly. If the IRS is requesting information from you or you received an IRS Letter 2645C, contact Fishman, Larsen & Callister. Let our knowledgeable and experienced tax planning attorneys help you and your business.