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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121335  
Subject: Re: IRS - What Next? Date: 6/26/2007 4:31 PM
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I put my wife's SS# on line 31b of the 1040 instead of my ex-wife's SS# for court ordered alimony. The IRS picked this up and sent me a letter June 11, 2007 disallowing the alimony payment. I called the IRS about how to correct this error and was told to send a complete copy of our tax return to the Richmond IRS office with a letter of explanation. We did this and the return card says it was received June 21st.

Now we have received a second IRS letter dated June 24th stating that (a) We failed to pay our taxes on time (though the return was mailed by certified mail on April 11 and received by them on April 14th), and (be) we owed for the entire additional tax on the IRA plus penalty and interest. There was no acknowledgment of our letter or the Waver Explanation or that what we paid wasn't enough or that the additional tax owed was in fact listed on line 60 of the 1040 so included in the calculations. They said we owed the whole thing, apparently again!

So I called the IRS again. After considerable consideration, the man I was talking to said he thought we should wait to hear a reply to our SS# dis-allowance correction, i.e. we should do nothing now. He thought the SS# error was the cause of the problem. He confirmed that our check to the Treasury had, indeed, been received.

Question: Is this last advice sound that we should wait for a response to the SS# screwup?


It's hard to say without seeing the notices.

The SSN problem, if uncorrected, would result in recalculated tax (without the alimony deduction), and you'd get a notice showing the tax as reported and as corrected, the payments credited, and the balance due. Ignore P&I. It would be coincidence to the nth degree if that amount was exactly the same as the line 60 penalty.

I'm unclear as to whether you sent a separate request for abatement of the 50% penalty or attached it to the return. If you sent it with the return there's a good chance nobody's ever going to look at it. If you sent it separately it's too soon to expect a response.

To keep yourself from going totally bonkers, keep the two issues totally separate in your mind. You really have two separate cases going on the one return, and they will have separate dispositions.

So, all that said, I'd wait for the next communication. In the meantime, look at the back of the canceled check to make sure it was properly credited.

Phil
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