notice from IRS for not including income that is clearly reported

[schirallicpa]

This is an older client.  We efiled his return in March of last year. He had 2 1099Rs last year for 30K and 40K.  IRS sent him letter CP2057 "you may need to amend your return" letter.  IRS says they are missing.  They clearly show up on front page of 1040 on lines 4a and b and 5a and b.  I don't even know how to respond to this.  "Dear IRS - did you look at the return?  Please see lines 4 and 5."  Good grief.  What a PITA.

 

[Abby Normal]

Were these IRA or non-IRA?

[Lee B]

Does the name address and EIN of the Fiduciaries that you entered in the return match the 1099 Rs?

Sometimes the fiduciaries' names, addresses and EIN change from year to year.

[schirallicpa]

8 minutes ago, Lee B said:

Does the name address and EIN of the Fiduciaries that you entered in the return match the 1099 Rs?

Sometimes the fiduciaries' names, addresses and EIN change from year to year.

checked already.  also double checked it was the correct year.  and one is a pension and one is an IRA and they are coded correctly.

[schirallicpa]

And no transcript alert on my software for him.  Wouldn't this normally show?  It would have generated a code.

 

[kathyc2]

If you have looked over the issue from a CP2057 notice and determined the original return is correct you do not NEED to do anything.  However, if you want to I'd send page 1 of 1040 along with the 2 1099R's. 

[Lee B]

If you don't respond then there is a good chance your client will receive the same notice next year.

[Gail in Virginia]

Interesting. I had a client bring in the same type of notice yesterday that listed all all of the income from the 1099Rs and 1099SSA as being reported to the IRS but not included on the return.  It almost looked as though the return was not filed at all because the only other income on the return was income that would not have been reported to the IRS at all (farming, etc).  The return was electronically filed with that income, so the taxpayer was going to go home and put his feet up to call them and see what they could tell him about why he got the letter.  I am waiting to hear what he finds out.  

[Catherine]

I wonder what is going on with the computers that these letters are being generated in the first place. Please report back!

[Lee B]

The IRS is in the middle of a total redesign of all of the notice letters.

[DANRVAN]

On 1/22/2024 at 9:28 AM, schirallicpa said:

you may need to amend your return" letter. 

If you filed it correctly then there is nothing to do but move on.

[Christian]

This very much parallels what a client of mine got as noted in my post today. they must be upgrading the system or something.  

[grandmabee]

Notice came out yesterday that IRS is simplifying their letters.  NOW we are in trouble... every time they simplify something it makes it worse.  Remember the postcard tax return turned into 8 pages.

[Gail in Virginia]

My client that called the IRS was told that he needed to file a 1040X with no change to remove the flag from his account.  Of course he wanted to file since the IRS told him to do that.  So i printed him a return, put in the explanation that it was being filed in response to a CP2057 notice and gave it to him to mail in.  I suggested that he attach a copy of the notice to the return.  It made him feel better.  I can't imagine that it will do anything but create more confusion with the IRS.  

[Lee B]

At the end of October there were 1.9 Million unprocessed amended tax returns