Notice of Deficiency

[TaxmannEA]

I just recieved a notice of deficiency for a client that shows possible under reported income for 2008. Shouldn't there have been some other correspondence such as a CP2000 before he gets this notice?

[JohnH]

What are the odds he did receive a CP2000 and ignored it, hoping the problem would go away?

I'd choose something between 99% and 100%. (Unless there has been a recent change of address.)

[TaxmannEA]

I have had POA's on this TP for the last several years due to problems in prior years. I also did not receive anything except for the notice of deficiency. I will admit that this particular client might overlook or mis-lay a prior notice, but I have seen nothing either. E-services does not have any notations of a CP2000 or the like on the account transcripts before this notice is listed.

[JohnH]

Sorry for being flippant - but as you know, one gets jaded after a few years of this sort of thing. From the additional info you've posted, it sounds like there may be some sort of bureaucratic hiccup here. Maybe you can use that to your client's advantage to gain some extra time to respond.

[BulldogTom]

TaxmannEA,

Not sure what the issue is in the tax return, but if you have everything ready to go to represent the client, the IRS just handed you the ticket to the tax court. It may be a blessing in diguise. I love dealing with the auditors that are assigned at the final level before tax court. They are generally very knowledgable, easy to work with, and professional. The few times I have had the opportunity to deal with an auditor reviewing the file prior to the tax court date, I have have always gotten the proper result.

If you are ready to proceed to tax court, just think of this as a way to bypass the beaurocracy and get straight to resolving the taxpayer's issue.

And no, I have never heard of a NOD coming as the first contact. You should call the IRS and see if they have any additional info for you.

Tom

Lodi, CA

[Lynn EA USTCP in Louisiana]

And, if the tax due is less than $50,000 it will be a 'small tax case', which the client may ask to be assigned to the Appeals Division at your nearest IRS office.

Lynn Jacobs, EA, FNTPI, NP

Kenner, La