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Background:
Tax year 2009; self-prepared 1040, MFJ. At 12/31/2009, taxpayers were 62 and 58.

Selected lines: line 7 = 10k; line 12 = $20k; line 32 = $12k. (Self-employment income relates to wife.)

$6k each transferred to 2 IRA trustees on 4/12/2010, one for husband (traditional), one for wife (SEP).

CP2000 received in late July, 2010. IRS states :
1. Wages per return exceed w-2’s reported to IRS (a list of W-2’s is provided, and one W-2 related to husband is missing from the IRS list).
2. Only one IRA trustee verified IRA contribution (the CP2000 shows that the missing verification relates to the wife’s IRA contribution).

In early August 2011, taxpayer provides to the IRS:
1. Copy of the “missing” W-2.
2. Copy of the wife’s 6/30/2010 quarterly statement from Vanguard reporting : “2009SEP-IRA Contribution $6,000” and showing the transaction dated 4/12/2010 captioned “2009 SEP-IRA contrib” for $6,000.
3. Copy of Vanguard’s 2010 Form 5498 for wife’s account showing in box 8 (SEP contributions) 6,000. The instructions for box 8 state in pertinent part: “Shows SEP contributions made in 2010, including contributions made in 2010 for 2009 . . .. If you made the contributions as a self-employed person (or partner), they may be deductible. See Pub. 560.”

My understanding of the pertinent section(s) of Pub. 560 is that the wife can certainly contribute to her SEP-IRA for 2009.

Received a letter dated September 8, 2011, stating that IRS has received my correspondence and will be in touch.

Received a second CP2000 dated October 3, 2011. IRS accepted the copy of the W-2 and agrees with me that husband was paid the small amount included thereon.

IRS still asserts that the wife’s SEP-IRA contribution is not verified by the trustee. Having provided the quarterly statement and 5498 from Vanguard, I am at a loss as to what to send them now. Any advice on how to respond to this second CP2000? Would I have any luck with a telephone call? To whom?

Thanks in advance,
Will
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No. of Recommendations: 1
Any advice on how to respond to this second CP2000? Would I have any luck with a telephone call? To whom?

I'd call the number on the CP2000. If there isn't one, call the Taxpayer Advocate.

Phil
Rule Your Retirement Home Fool
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No. of Recommendations: 1
Called toll free assistance number on the CP2000. After 25 minutes on hold, got disconnected.

Called taxpayer advocate number per IRS website. Very nice lady listened to my story and said that she was unable to assist me because I had not talked to the assistance line. She transferred me back to the assistance number on the CD2000.

Finally talked to the assistance line noted on the CP2000. I reviewed the contents of the previous CP2000, what documents I had submitted in response, and the contents of the current CP2000. The assistance line guy indicated that they were "only a call center" and that he could not view or verify any documents that I may have submitted. He advised to submit the same information again.

So, I will submit the same documents again and hope for a different result.

This sounds a lot like the definition of insanity.

Will
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