Letter 525 from IRS
L1: Letter 525 from IRSI received a Letter 525 from the IRS today concerning my 2007 Tax return charging me the 10% penalty on my distribution. Starting in 2007 Fidelity wouldn’t code the 1099R form with a “2”. I filed form 5329 with my 2007 return with a “2” for the exception.
I called Fidelity and they still won’t correct the 1099R.
In the letter it says to send supporting documentation. I could send them the numbers (account balance, ages) and the calculations on how I arrived at the distribution amount.
Should I call the IRS and explain? Should I just send the documentation. Should I get a tax attorney?
What really scares me is this was my 10th distribution and what if they come after me for all the others. Maybe it’s better to pay this hoping they don’t look at the earlier returns.
Any help would be appreciated.2009-07-13 21:09, By: daddy0, IP: [22.214.171.124]
L2: Letter 525 from IRSJust send them the documentation that justifies what you have done and that will show that you know what you are doing.
My opinion, but… Calling the IRS would be a waste of time and getting a tax attorney at this point would be a waste of money.2009-07-13 21:48, By: Gfw, IP: [126.96.36.199]
L2: Letter 525 from IRSDaddyo,
In my recent response to “D” on his posting, I mentioned thatpeople have been posting about being audited for their SEPP plans. If you do a search on topics for IRS AUDIT, you shd find some of those postings in the past few months. Some havefollowed up with comments that the IRS accepted their documentation for their plan after they submitted it in response tothe 525 letter. Here is a website I found on the subject of 525 letter that may also be of help. I would definitely reply with Certified mail, return receipt requested, so you have proof that you responded within 30 days. Others may give you info on specifics of what to submit to the IRS.
Here are some earlier posts that may be worth reading:
Change # of months to higher number and scroll down thru pages until you find them by date and name:
Wayne 3-28-009 and 6-2-09 with outcome
KEN2009-07-13 21:49, By: Ken, IP: [188.8.131.52]
L3: Letter 525 from IRSJust to let everyone know I sent my documentation to the IRS and I received a “No Change Letter” so I’m off the hook. It took a little over two months. What a relief. Thanks to everyone for their advice.
Mike2009-09-22 20:45, By: Daddy0, IP: [184.108.40.206]
L4: Letter 525 from IRSGlad to hear and thanks for letting us know.2009-09-22 20:51, By: Gfw, IP: [220.127.116.11]