IRS Letter Follow-up
L1: IRS Letter Follow-upI posted previously, see Wayne 3/28/09. I received an IRS letter claiming I owed back taxes. I’ve been taking 72t/q for 7 years. I had $100k of penalties at stake.
Today I recieved a letter saying the IRS had dropped their claim for back taxes. Apparently they didn’t read my return and this inquiry was without foundation. After being concerned for months, this appears to be over.
I though I’d let anyone interested know the outcome. You can read my previous post to see how I responded and more details. If you have any questions let me know.
2009-06-02 00:59, By: Wayne, IP: [126.96.36.199]
L2: IRS Letter Follow-upWayne,
Thanks for posting back on the positive results. I am not sure whether this means that the IRS agrees that interest rates have more flexibility prior to 2002-62 or that they just backed off for some other undisclosed reason.2009-06-02 22:05, By: Alan S., IP: [188.8.131.52]
L3: IRS Letter Follow-upI did not tell them about the interest rate that I used or explain any details about my plans. I just said that I began withdrawals per the 89-25 rules and have withdrawn the same amount since I started.I simply said that I was taking SEPP from three different accountsandthat my return includeda 5329 because my 1099’s werecoded with a 1 due to changing of custodians.
I’m not sure why they were questioning my return but they dropped the claim that I owed a penalty.
Maybe alesson here is that giving them less information might be better than giving them more.
Hopefull this will be the end of it, I have5 more years until I am 59.5. It’s stressful not knowing what they are thinking for the months it takes to get a reply from them.
I faxed them my reply.2009-06-02 22:20, By: Wayne, IP: [184.108.40.206]
L4: IRS Letter Follow-upYou made a wise decision in what you provided them. Generally, a person is better off to provide a basic response only, particularly when there is an element of doubt whether the additional detail will be well received, in this case your use of a higher interest rate than that dictated by 2002-62, notwithstanding that you started the plan prior to 2002-62.2009-06-02 23:51, By: Alan S., IP: [220.127.116.11]