What to do about mail from the IRS??

Question

got a letter in the mail from the IRS stating they need an explanation(like reciepts) from 2006 for my work expenses. I dont have any of that stuff anymore and i dont know what to do. I have 30 days to mail it in, but i dont have it. I am scared to death! what do i do????

ahhhhh.

Answer 1

You have a major problem that needs to be approached with diligence.  You should make every effort to reconstruct your records.  Depending on your reason for not having them the IRS may accept a reasonable approach to reconstruction.  However they are not required to do so and they could deny any of the items for which they have asked for further explanation.  I have succeeded in such matters when the reason for not having the originals is persuasive.  However ignoring this matter can cause you great discomfort with penalties and interest from the date of the original return.    

Answer 2

You don't have proof to show IRS then IRS will not accept your expenses and you will probably owe them now.  Why in the world would you not save your receipts and copy of your tax return, everyone says 3 years but i would save them for at least 7 years.  

You should be scared to death, you are making it look like you lied on your tax return.

Contact IRS at the phone number listed on your letter they are the only ones that can assist you and let you know what the next step is.

Good luck! Relax, if you end up owing IRS you can always ask for an installment agreement.

Answer 3

That's why you should keep receipts for at least three years.  It generally takes a year or two for them to contact you - initially only the most obvious items are verified.  Too late now, I know.  Can you go back and prove any of the expenses, at least any big ones?  If you can't substantiate the deductions, they'll most likely be disallowed.

Answer 4

The supporting documentation was part of your return, you were supposed to keep EVERYTHING for at least 3 years.

Since you admit you don't have any of it and are unlikely to be able to get new copies of it (without a mileage log, you can't claim mileage, for example), you need to simply say so in response.  If true, stress why you no longer have the receipts.  The IRS will disallow the expenses, adjust your tax bill and allow you to set up an installment agreement.

Unfortunately, the IRS will probably also do the same to your 2005 and 2007 tax returns.  If they think you padded the numbers (as opposed to losing the receipts), you could find them going back to earlier years.  There is no statute on fraud.    

Of course, that means that your 2005, and 2007 tax returns will be reviews looking for similar expenses.

Answer 5

Call them, tell them you don't have it and ask them when they would like to audit you.  What they will probably do is disallow your deductions and require you to make up the taxes.  

In the future, remember to keep all receipts you base your deductions on for 5 years.

Answer 6

Start getting this together. . . .go through old records

You KNEW you were supposed to keep this stuff

Whatever you do, don't ignore them.  

They are tenacious and will follow you.  So find your records, or get together what you can, or admit that your records are gone and be prepared to have your nonreimbursed work expenses disallowed and to pay the tax due. .  .and be prepared for last 3 years taxes to be closely scrutinized on same issues. . . .start searching for whatever supporting papers you can find. . .something is better than nothing. . . .and hope they don't just decide it's fraud on your part. . . .