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Don’t Be Surprised If You Get a Verification Letter

Updated: Feb 13, 2021

Letter 4464, is generally a letter generated by the Internal Revenue Service, letting a taxpayer know that they have received their tax return, and are holding on to their refund. This is part of the identity theft review that the Internal Revenue Service started a couple of years ago. What was happening, was that, unscrupulous people, were filing fake tax returns, using other people Social Security numbers. They were claiming inflated refunds, and ripping the government off for millions of dollars. When the real taxpayer went to file their tax return, their return would be rejected by the Internal Revenue Service, because a return had already been filed. This was a mess. I had a couple of clients, have this happen to them. It was hard to clean up, and became a big problem. A couple years ago, the Internal Revenue Service realized that this was a bigger issue, so they began doing checks on large refunds.

That brings us to the new verification letters that are going out to select taxpayers this year. The Internal Revenue Service, is now selecting (randomly they say) taxpayers to verify their identities. A letter is generated from the Internal Revenue Service, and sent to a taxpayer. The taxpayer needs to go to a website, and verify information to make sure that it is them. This can be a cumbersome process, however it is necessary. Identity theft has run rampant at the Internal Revenue Service, and with the hundreds of millions of dollars the Internal Revenue Service has given to identity thieves, they need some sort of way to verify if a taxpayer really filed a tax return.

The question that I would have with this E-verify process, is how reliable is it? What information does the IRS have, that they are trying to verify? I don’t have any clients, yet (knock on wood), that have received such a letter. We have been alerted as practitioners, to be on the lookout for these letters. I can only imagine, what verifications the IRS is looking for. As we know, their computer system, can sometimes be a hamster on a wheel.

A few months ago, I wrote an article about a pilot program going on in a couple of states. Our home base, is Florida, and was one of the states that was allowed to take part of this pilot process. In the pilot process, you could go to a website, and receive a verification number. When you filed your tax return, you couldn’t file it without this verification number. This seems like a better idea, then sending out letters to people. Every time I see a client that has a large refund, I always warn them that their refund will be held up. Let’s hope, the IRS does not make this a cumbersome process, as they do with everything else.

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