So, You Got an IRS Letter? Don't Panic - Yet.

It’s not a love letter, clever invitation to Church, or one of those letters with your name or "current resident". But it is important.

Why You’re Probably Reading This- You Got an IRS Letter. . .

You opened your mailbox expecting coupons, political flyers, or an HOA violation. Instead, boom: “Department of the Treasury – Internal Revenue Service.” Your blood pressure spikes. You briefly consider fleeing the country.

Deep breath.

Getting a letter from the IRS is not a guaranteed ticket to audit-land. It’s more like a traffic light: red means trouble, yellow means respond, green means… well, that rarely happens, let’s be honest. The key is understanding what kind of letter you’ve received, and then handling it correctly and on time.

Let’s walk through it—panic-free and penalty-averse.

Step 1: Actually Open the Letter. Really.

You wouldn’t believe how many people delay this step, hoping the problem will magically go away. Spoiler: the IRS does not ghost. And unlike your ex, if they don’t hear from you, they will follow up—with interest and penalties.

IRS letters typically include:

• A notice number (like CP2000, LT11, or 5071C)

• The tax year in question

• A summary of what the issue is

• The deadline to respond or take action

• Any amounts due or documentation requested

Put that deadline on your phone, on your fridge, and maybe even on your bathroom mirror. Hell tell you mother-in-law.... she WILL remind you, because while you can wait on the IRS, they WILL NOT wait for you.

Step 2: Figure Out What They’re Saying (and Not Saying)

Most IRS letters fall into one of the following categories:

Type of Letter	What It Usually Means
CP2000	The IRS found unreported income (usually from W-2s, 1099s, crypto, etc.). They're proposing an adjustment.
LT11 or CP504	You're behind on taxes and they're warning of collections or levy action.
5071C or 6331C	Identity verification is needed before they process your return.
CP3219A (Statutory Notice of Deficiency)	The IRS says you owe more, and you're about to lose the chance to fight it unless you respond.
Letter 12C	They're missing documentation—common with things like Premium Tax Credit forms or identity verification.

And sometimes... it’s just a polite confirmation. Like, “Hey, we got your payment. Thanks.” But let’s not get our hopes up.

Don't mind if I do.

Step 3: Don't Spiral Into Worst-Case Scenarios

Unless the letter has the word “audit,” “levy,” or “seizure” in it (yikes), you’re likely not in as much trouble as you think. Common triggers include:

• A mismatched W-2 or 1099

• An underreported stock sale (thanks, Robinhood)

• Claiming credits you didn’t fully qualify for

• A typo or transposed number

• Income the IRS knows about but you forgot (hi, Venmo side hustle) - Hello Form 1099-K (disaster zone)

Good people make mistakes. The IRS knows that. That’s why there’s a process for responding. And appealing. And explaining.

Step 4: Don’t Call the IRS (Yet)

Unless the letter explicitly tells you to call, hold off. Most matters can be handled by mail or a representative.

Here’s the thing: the IRS phone lines are… well, let’s say they’re ambitiously understaffed. Even if you get through, you might spend 2 hours on hold only to be told to “respond in writing.”

Instead of calling, start gathering your documents. This is where it’s time to…

Step 5: Call Someone Who Used to Work There (Hi, That’s Us.)

At ExFed Tax, we’re not just tax pros. We’re former IRS agents and leaders. We’ve been on the other side of those letters. We helped trained the folks sending the letters to you.

That means we know how to:

• Decode the IRS’s confusing language

• Identify what they’re really asking for

• Draft clean, professional responses that solve problems

• Negotiate payment plans, penalty relief, and fix misreported items

• Shield you from triggering unnecessary audits

In short: We make the IRS behave… and we help you sleep better at night.

Step 6: Respond On Time. Always.

Even if you disagree with what the IRS says in the letter, you must respond by the deadline listed. Otherwise, they assume you agree—and start moving forward with penalties, interest, or collections.

✉️ Silence = Consent in the eyes of the IRS.

That face when you hear an antiquated policy.

Even a short response requesting more time, or acknowledging receipt while you gather documents, is better than nothing. Let the IRS know you're not ignoring them. That alone can buy you options.

Step 7: Do NOT Pay First and Ask Questions Later

This one’s tricky. Many taxpayers panic, write a check, and think, “I'll figure out the details later.” But if the IRS made a mistake (and yes, it happens), you could be paying more than you owe—or losing appeal rights.

Let a professional help you confirm the accuracy of the notice before you send money. We’ll tell you if it’s legit, negotiable, or straight-up wrong.

Final Thoughts: You’re Not Alone. But You Do Need to Act.

The IRS sends out millions of letters a year. Most are resolved easily with a little paperwork, a good tax pro, and a level head.

But the longer you wait, the fewer options you have—and the more expensive things can get.

So:

• Don’t ignore it.

• Don’t assume the worst.

• Don’t go it alone.

  
  

Ready to Get Help?

We’ve been in the IRS. Now we’re on your side. If you’ve received a letter (or have a stack you’ve been avoiding), let’s tackle it together.

Contact ExFed Tax today to schedule a consultation. Let's chat in-person if you're in Houston, or virtually anywhere else. We’ll bring the coffee, the calm, and the confidence.