Delray Beach, FL asked in Tax Law for Florida

Q: I received a Schedule C letter from the IRS. I don't know why? Please help!!!

The letter say that I'm been audited and need additional informations.I received 2 forms the first it's shedule C-4 (general explanation of items). The 2nd form shedule C-5(car and truck expenses).

I don't know what to respond, I never had or owned a business.

Please Help!! Thank you.

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1 Lawyer Answer
Joseph Wilson
Joseph Wilson
  • Tax Law Lawyer
  • Newport Beach, CA

A: Letters from the IRS are the start of a conversation and it is your turn to respond politely. They are asking about some items reported on your tax return. So the first step is to review the letter and indentify which tax year is being examined.

Then review your tax return and compare it with the issues identified in the IRS letter. It appears they are asking about expenses and maybe income reported on Schedule C. If you didn't have a business you wouldn't normally have a schedule C.

Sometimes a return preparer will include a Schedule C for various reasons, e.g., to attempt to qualify for an EIT credit. There is also a great deal of identity theft going around. Fraudsters use other people's SSNs to file tax returns, claiming false tax refunds, which they direct to themselves.

If your tax return doesn't have a Schedule C or the items listed in the IRS letter send a letter to the IRS at the address in the audit notice with a copy of your tax return, letting them know the issues in the IRS notice do not match the return you filed.

It would also be a good idea to contact a CPA, enrolled agent or tax attorney. You should provide them a copy of the IRS notice and your tax return to verify the issues to determine the best approach.

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