IRS Letter 1226: What It Means When the IRS Clears Your Audit
Summary:
IRS Letter 1226 is sent to notify taxpayers that an audit of their tax return has been closed with no changes. This means the IRS found no discrepancies in the information provided. While receiving a notice from the IRS can be unsettling, this particular letter is good news. There’s no immediate deadline or action required, but understanding why you received it and keeping a copy for your records is essential.
Have you received IRS Letter 1226 notifying you about the closure of an audit with no changes to your tax return? If so, don’t worry—this letter confirms that the IRS has reviewed your return and found no issues requiring adjustment. It’s important to understand the purpose of this letter and the steps to take to maintain accurate tax records moving forward. Let’s dive into what IRS Letter 1226 means, why you received it, and how to handle it effectively.
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What is IRS Letter 1226?
IRS Letter 1226 is a formal communication from the Internal Revenue Service (IRS) that informs taxpayers their audit has been concluded without any changes to their tax return. Commonly referred to as the “Closing Letter – No Change,” this notice indicates that the IRS found no discrepancies in the reported income, deductions, credits, or other details provided on the tax return.
Why is this letter important?
This letter is significant because it confirms the closure of an IRS audit—a process many taxpayers find intimidating. Audits are conducted to ensure compliance with tax laws, and receiving this notice provides peace of mind that your return was accurate. Additionally, IRS Letter 1226 serves as official documentation that no further investigation is needed for the tax year in question.
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Pro Tip
Set up IRS account alerts online to get real-time notifications on any changes to your tax return or account. This helps you stay updated on adjustments and due dates.
Key details in IRS Letter 1226
IRS Letter 1226 serves as an important communication from the IRS, formally notifying taxpayers about the conclusion of an audit without any changes to their tax return. The letter confirms that the IRS has thoroughly reviewed the return and found all reported information, including income, deductions, and credits, to be accurate. This outcome indicates that the taxpayer has successfully substantiated their claims and complied with the agency’s requirements.
The issuance of this letter typically follows a detailed review process, during which the IRS may have requested supporting documentation to verify the accuracy of the return. Once the IRS confirms that no adjustments are necessary, the taxpayer is informed through IRS Letter 1226. It’s important to understand that this letter not only signifies the closure of the audit but also serves as official documentation that your return was examined and approved.
Maintaining this letter in your tax records is crucial for future reference. Should similar issues arise in the future, having this document readily available can help you resolve questions more efficiently and demonstrate compliance with IRS standards. In essence, IRS Letter 1226 is not just a closing notice but also a valuable record that reassures you of your tax filing accuracy.
Pro Tip
Create a dedicated folder for tax documents each year, including any IRS correspondence like Letter 1226. Organized records make it easier to respond to future inquiries or audits.
Why you might receive IRS Letter 1226
Receiving IRS Letter 1226 typically follows an audit of your tax return. While audits are often viewed negatively, this specific letter is a favorable outcome. Here’s why you might receive it:
1. Your tax return was selected for audit
Every year, the IRS audits a small percentage of tax returns to ensure compliance with tax laws. Returns are selected for audits either randomly or because they contain elements that trigger closer scrutiny, such as:
- High-income earners with complex tax filings
- Large deductions or unusual claims compared to previous years
- Discrepancies between income reported on tax forms and other records, such as W-2s or 1099s
Despite these triggers, an audit doesn’t necessarily mean you’ve made a mistake. Often, the IRS just needs additional documentation to verify the information you provided.
2. You submitted required documentation
If the IRS requested supporting documentation during the audit, such as receipts for deductions or proof of income, and you provided sufficient evidence, they may conclude that your tax return was accurate. This thorough review process can take weeks or even months.
3. No discrepancies were identified
After evaluating your return and the supporting documents, the IRS determined that everything matched their records and the tax code requirements. IRS Letter 1226 confirms that the audit has been closed without any adjustments to your return.
Pro Tip
Review your tax return annually for common audit triggers, such as unusually large deductions or mismatched income reporting. Addressing potential issues before filing can reduce audit risks.
How to respond to IRS Letter 1226
Receiving IRS Letter 1226 doesn’t typically require immediate action, but there are steps you should take to ensure proper record-keeping and preparation for future tax seasons.
1. Review the letter
Read the letter carefully to ensure it confirms the audit closure with “no changes.” If there are any discrepancies in the letter’s content, contact the IRS for clarification.
2. Retain a copy for your records
Keep a copy of the letter with your tax records for the audited year. This documentation can be helpful if similar questions or audits arise in the future, as it proves the IRS has already reviewed and approved your return.
3. Reflect on the audit process
While receiving IRS Letter 1226 is a positive outcome, the audit itself may reveal areas where you can improve your tax filing practices. Consider working with a tax professional to identify any potential red flags in your returns and implement better record-keeping habits.
What should you do if you lose IRS Letter 1226?
If you misplace the letter, you can request a transcript of your account for the relevant tax year from the IRS. This transcript will show that your audit was closed with no changes. Here’s how you can request it:
- Log in to your online IRS account and access your transcripts.
- Contact the IRS directly by phone or mail to request a copy.
- Work with a tax professional to retrieve the necessary documentation if needed.
Pro Tip
If you’re audited in the future, request professional tax assistance early. A certified tax expert can help gather necessary documentation and navigate the audit process efficiently.
How to prevent future audits
Although audits can happen randomly, there are steps you can take to reduce the likelihood of being audited in the future:
1. Ensure accurate reporting
Double-check all information on your tax return, including income, deductions, and credits. Use reliable tax preparation software or work with a professional to avoid common errors.
2. Maintain detailed records
Keep all relevant tax documents, such as receipts, invoices, and bank statements, for at least three to seven years. These records will be invaluable if the IRS questions any items on your return.
3. Avoid red flags
While you should always claim the deductions and credits you’re entitled to, be cautious about making claims that significantly deviate from typical amounts for someone in your income bracket. For example, unusually large charitable deductions relative to your income could trigger an audit.
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Frequently asked questions
what is the purpose of IRS letter 1226?
The purpose of IRS Letter 1226 is to notify you that an audit of your tax return has been completed, and no changes are necessary. It serves as confirmation that the IRS found your tax return accurate based on their review.
does receiving IRS letter 1226 mean I am safe from future audits?
Receiving IRS Letter 1226 means the audit for the specific tax year in question is resolved with no issues. However, it doesn’t prevent the IRS from auditing your returns for other tax years or reviewing future filings. Maintaining accurate records and following tax laws will help minimize future audit risks.
should you take any action after receiving IRS letter 1226?
No immediate action is required after receiving IRS Letter 1226. However, it’s wise to retain the letter for your records as proof that the IRS reviewed and approved your tax return without changes. This may be useful if similar issues arise in the future.
can you appeal an IRS audit if you disagree with the findings of letter 1226?
IRS Letter 1226 confirms an audit with no changes, meaning the IRS agreed with your original tax return. Since no changes were made, there is no basis for appeal. If you have further questions or concerns, consider consulting a tax professional for clarification.
how long should you keep IRS letter 1226 for your records?
You should keep IRS Letter 1226, along with your tax return and supporting documentation, for at least seven years. This is the standard timeframe for retaining records in case of future disputes or audits. Keeping organized records can make it easier to address any future issues.
Need help understanding other IRS letters and notices? Visit our comprehensive guide to IRS Letters and Notices or search for the document you received in the table below.
| CP01 | The IRS verified your claim of identity theft and will monitor your account. |
| CP01H | The IRS received a tax return with a social security number that belongs to a dead person. |
| CP02H | Money is due on an amended return based on a grant received due to Hurricane Katrina, Rita, or Wilma. |
| CP03C | You received the First-Time Homebuyer Credit for a house you purchased. |
| CP04 | You may be eligible for tax deferment because either you or a spouse served in a combat zone, a qualified contingency operation, or a hazardous duty station during the tax year specified on your notice. |
| CP08 | You may be entitled to additional money due to the Additional Child Tax Credit. |
| CP10 | Your tax return changed due to a miscalculation, and the refund you wanted to apply to an estimated tax payment has changed. |
| CP10A | Your tax return changed due to a miscalculation of the Earned Income Credit, and the refund you wanted to apply to an estimated tax payment has changed. |
| CP11 | You owe money because the IRS amended your return due to a miscalculation. |
| CP11A | Your tax return changed due to a miscalculation of the Earned Income Credit, and the refund you wanted to apply to an estimated tax payment also changed. |
| CP11M | Your tax return changed due to a miscalculation of the Making Work Pay and Government Retiree Credit, and the refund you wanted to apply to an estimated tax payment has changed. |
| CP12 | You are due a bigger refund because the IRS corrected one or more mistakes on your tax return. |
| CP12A | The IRS made changes to correct the Earned Income Credit (EIC) claimed on your tax return. |
| CP12E or CP12F | The IRS corrected a miscalculation on your return. |
| CP12M | The IRS made changes to the computation of the Making Work Pay and/or Government Retiree Credits on your return. |
| CP12R | The IRS made changes to the computation of the Rebate Recovery Credit on your return. |
| CP13 | The IRS made changes to your return due to a miscalculation. There is no refund or amount due. Your balance is zero. |
| CP13A | The IRS made changes to your return due to a miscalculation of the Earned Income Credit. There is no refund or amount due. Your balance is zero. |
| CP13M | The IRS made changes to your return due to a miscalculation of the Making Work Pay credit or the Government Retiree Credit. There is no refund or amount due. Your balance is zero. |
| CP13R | The IRS made changes to your return due to a miscalculation of the Recovery Rebate Credit. There is no refund or amount due. Your balance is zero. |
| CP14 | You owe money on unpaid taxes. |
| CP16 | The IRS made changes to your return due to a miscalculation. The refund you were due was applied to other tax debts. |
| CP21A | You owe money due to the changes you requested that the IRS make on your tax returns. |
| CP21B | You are due a refund due to the changes you requested that the IRS make on your tax returns. The money should arrive within 2 to 3 weeks. |
| CP21C | The IRS made the requested changes to your tax return. You will not receive a refund, and there is no tax due. Your balance is zero. |
| CP21E | As a result of your recent audit, the IRS made changes to your tax return, and you owe money as a result of those changes. |
| CP21I | The IRS made changes to your tax return relating to the Individual Retirement Arrangement (IRA) taxes. You owe money due to the changes. |
| CP22A | The IRS made the changes you requested, and you owe money as a result. |
| CP22E | As a result of your recent audit, the IRS changed your tax return, and you now owe money. |
| CP22I | The IRS made changes to your tax return relating to the Individual Retirement Arrangement (IRA) taxes. You owe money due to the changes. |
| CP23 | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. You owe taxes due to these changes. |
| CP24 | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. This resulted in an overpayment of estimated taxes. |
| CP24E | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. This resulted in an overpayment of estimated taxes. |
| CP25 | The IRS changed your return because there was a difference between the amount of estimated tax payments listed on your tax return and the amount actually posted to your account. You are not due a refund, nor do you owe any money. Your balance is zero. |
| CP31 | You need to update your address because your refund check was returned to the IRS. |
| CP45 | The IRS was unable to apply your overpayment to your estimated tax as you requested. |
| CP49 | The IRS used all or part of your refund to pay a tax debt. |
| CP53 | Your refund check will be sent by mail because the IRS can’t provide your refund through direct deposit. |
| CP57 | The bank declined your payment, so the IRS was unable to draft funds from your bank account. |
| CP71 | A reminder of the amount you owe in tax, penalty, and interest. |
| CP71A | A reminder of the amount you owe in tax, penalty, and interest. |
| CP71C | A reminder of the amount you owe in tax, penalty, and interest. |
| CP71D | A reminder of the amount you owe in tax, penalty, and interest. |
| CP88 | The IRS is holding your refund because you haven't filed one or more tax returns, and it believes you will owe tax. |
| CP90 | The IRS is notifying you of its intent to levy certain assets for unpaid taxes. You have the right to dispute the levy in a Collection Due Process hearing. |
| CP91 | The IRS will levy up to 15% of your social security benefits for unpaid taxes. |
| CP120 | The IRS needs documentation of your tax-exempt status. |
| CP120A | Your organization’s tax-exempt status has been revoked because it failed to file a Form 990 series return for three consecutive years. |
| CP130 | You may no longer need to pay the Alternative Minimum Tax (AMT) because your tax return filing requirements changed. |
| CP152 | The IRS received your return. |
| CP153 | The IRS will send your refund by mail because your direct deposit did not go through. |
| CP161 | You have an unpaid balance due to the IRS. |
| CP166 | Your monthly payment to the IRS did not go through due to insufficient funds in your bank account. |
| CP178 | You may no longer owe excise tax because your tax return filing requirements changed. |
| CP231 | You need to update your address because your refund was returned to the IRS. |
| CP259 | You did not file the business tax return identified in the notice. |
| CP259A | You should have filed these forms but did not – Form 990/990-EZ, Return of Organization Exempt From Income Tax, or Form 990-N (e-Postcard). |
| CP259B | The IRS requires you to file these forms but did not – Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation. |
| CP259C | The IRS believes that you are a private foundation, but did not file the required Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation. |
| CP259D | You must file this form, but you did not – Form 990-T, Exempt Organization Business Income Tax Return. |
| CP259E | You should have filed this form, but you did not – Form 990-N (e-Postcard) or Form 990/990-EZ, Return of Organization Exempt From Income Tax. |
| CP259F | The IRS requires you to file this form but did not – Form 5227, Split-Interest Trust Information Return. |
| CP259G | The IRS requires you to file this form, but you didn’t – Form 1120-POL, U.S. Income Tax Return for Certain Political Organizations. |
| CP259H | As a tax-exempt political organization, you must file this form, but you did not – Form 990/990-EZ, Return of Organization Exempt From Income Tax. |
| CP276A | You submitted your tax liability schedule incorrectly. The IRS typically charges a Federal Tax Deposit (FTD) penalty for this but did not this time. |
| CP276B | The IRS did not receive the correct amount of tax deposits. It normally charges a Federal Tax Deposit (FTD) penalty but did not this time. |
| CP297 | The IRS is notifying you of its intent to levy certain assets for unpaid taxes. You have the right to dispute the levy at a Collection Due Process hearing. |
| CP297A | The IRS has levied your assets for unpaid taxes. You have the right to dispute the levy at a Collection Due Process hearing. |
| CP298 | The IRS notifying you of its intent to levy up to 15% of your social security benefits for unpaid taxes. |
| CP501 | You have a balance due on one of your tax accounts. |
| CP503 | You have an unpaid balance on one of your accounts, and the IRS has not heard from you. |
| CP504 | You have an unpaid amount due on your account. If you do not pay immediately, the IRS will levy your state income tax refund to apply it to the amount you owe. |
| CP504B | You have an unpaid amount due on your account. If you do not pay immediately, the IRS will levy certain property or rights to property to apply it to the amount you owe. |
| CP521 | A reminder that you have an installment agreement payment due. |
| CP523 | You have defaulted on your payment agreement. Therefore the IRS is terminating the agreement and will levy your assets. |
| CP601 | Usted tiene un saldo pendiente de pago (dinero que le debe al IRS) en una de sus cuentas contributivas. |
| CP603 | No hemos recibido respuesta de parte de usted y todavía tiene un saldo sin pagar en una de sus cuentas contributivas. |
| CP604 | Usted tiene un saldo sin pagar en su cuenta. De no pagar esta cantidad inmediatemente, el IRS embargará cualquier reembolso de impuestos estatales al que tenga derecho y aplicarlo al pago de su deuda. |
| CP604B | Usted tiene un saldo sin pagar en su cuenta. De no pagar esta cantidad inmediatemente, el IRS embargará ciertas propiedades o derechos de propiedad y lo aplicará al pago de su deuda. |
| CP621 | Este aviso es para notificarle que usted tiene un plan de pagos a plazos vencido. Por favor, envíe el pago inmediatamente. |
| CP623 | Este aviso es para informarle nuestra intención de cancelar su plan de pagos a plazos y confiscar (embargar) sus bienes. Usted incumplió en su acuerdo. |
| CP711 | Nosotros realizamos cambios a su planilla debido a que entendemos que hubo un cálculo erróneo. Como resultado de estos cambios, usted adeuda dinero por sus contribuciones. |
| CP721 | Hicimos el(los) cambio(s) que usted solicitó a su declaración de impuestos para el año tributario que aparece en su aviso. Como resultado de éste(estos) cambio(s) usted debe dinero en sus impuestos. |
| CP722 | Hicimos el(los) cambio(s) que usted solicitó a su declaración de impuestos para el año tributario que aparece en su aviso. Como resultado de éste(estos) cambio(s) usted debe dinero en sus impuestos. |
| CP771 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP772 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP773 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP774 | Usted recibió este aviso para recordarle sobre la cantidad que adeuda en contribuciones, multas e intereses. |
| CP959 | Usted no radicó su planilla de contribución de negocios identificada en este aviso. |
| CP2000 | The income or payment information on file doesn’t match your tax return. The discrepancy may result in an increase or decrease in your tax due. |
| CP3219A | The IRS has received information that is different from what you reported on your tax return. This may result in an increase or decrease in your tax. |
| CP3219N | The IRS didn’t receive your tax return, so it calculated your return based on the information received from employers, financial institutions, and others. If you want to challenge the proposed tax, you have 90 days from the date of this notice. If you are outside the country, you have 150 days. |
| Letter 0012C | The IRS needs additional information to process your tax return. |
| Letter 0484C | The IRS wants a completed |
| Letter 0525 | Updates you on proposed changes after an IRS examination. Any changes are explained and details the refund due or taxes owed. |
| Letter 531 | IRS Notice of Deficiency. The information the IRS received about you was different from what you reported on your return. |
| Letter 0668D(LP 68) | The IRS released their levy. |
| Letter 0549C | Your tax bill was paid. |
| Letter 0681C | The IRS accepted your payment proposal. However, this is not a formal Installment Agreement. |
| Letter 0757C | You did not adhere to the terms of your Installment Agreement. |
| Letter LT 11 | The IRS plans to seize your property or rights to property. |
| Letter 1058 | The IRS has not received your payment. It plans to seize your property or rights to property. |
| Letter 1615 (LT 18) | You must respond to the IRS within 10 days of this notice regarding past due tax returns. |
| Letter 1737 (LT 27) | Complete and sign Form 433F, Collection Information Statement. |
| Letter 1961C | Your application for a Direct Debit Installment Agreement was declined. It explains why and what you need to do to qualify. |
| Letter 1962C | Your application for a |
| Letter 2050 (LT 16) | The IRS is trying to collect unpaid taxes from you from returns that have been filed or from returns that have not been filed. |
| Letter 2257C | The IRS is providing the payoff amount that you requested. |
| Letter 226-J | An IRS letter to large employers notifying them that they may be liable for an Employer Shared Responsibility Payment (ESRP). |
| Letter 2271C | A request for an Installment Agreement has been approved. It explains the fees and how to qualify for a Low Income Fee Reduction. The letter may also request missing information. |
| Letter 2272C | An IRS letter explaining why your request to pay the balance due in installments was declined. |
| Letter 2273C | A confirmation letter of your request to pay the balance due in installments. It contained the amount to pay, fees charged, and where to send payment. Instructions on how to apply for the Low Income Fee Reduction included. |
| Letter 2318C | A response to a request to pay taxes due to payroll deductions. It also explains the fees that are charged. |
| Letter 2357C | The IRS is admitting that it did not send you the balance due notices that it should have. |
| Letter 2603C | The IRS accepted your installment agreement. The IRS will file a Notice of Federal Tax Lien on your personal property. |
| Letter 2604C | The IRS has accepted your request for installment payments. This IRS letter provides the monthly payment, the address where to send it, and the fees charged. The letter also provides instructions on how to apply for the Low Income Fee Reduction. |
| Letter 2761C | The IRS is requesting your combat zone service dates to ensure that it provides you with the special provisions and protection of the combat zone deferment. Copies of military orders or other documentation to support your time served may be requested. Civilians working in support of the Armed Forces may be required to provide a Letter of Authorization or a letter from their employer. |
| Letter 2789C | An annual reminder notice, as required by law, of the balance due to the IRS. It explains that penalties and interest continue to accrue until the balance is fully paid. |
| Letter 2840C | Confirms your Installment Agreement request and includes the payment amount and due date. This IRS letter explains the fees charged for paying monthly and explains how to apply for the Low Income Fee Reduction (if you qualify). |
| Letter 3030C | Provides an explanation of the tax, penalty, and interest still due on your account. |
| Letter 3127C | A confirmation of your request to make a change to your Installment Agreement. This IRS letter explains the fees for the change. Changes can be to the payment amount or due date, or it can include additional liabilities. |
| Letter 3174 | A reminder of taxes due after the IRS has sent a Notice of Intent to Levy. |
| Letter 3217C | The IRS has accepted your request to pay the balance in installments. This IRS letter provides your payment amount, the due date, and fees charged. The letter also provides instructions on applying for the Low Income Fee Reduction (if you qualify). |
| Letter 3228 (LT 39) | A request to pay the balance due within 10 days using the envelope provided. |
| Letter 3500 | The IRS has received your documents, and it needs additional time to review them. |
| Letter 3572 | Your Federal Income Tax Return has been selected for examination. The IRS auditor requests that you call to schedule an audit appointment. |
| Letter 4883C | The IRS received your federal income tax return but needs more information to verify your identity in order to process your tax return accurately. |
| Letter 4903 (LT 26) | You must file your tax returns immediately. The IRS has previously contacted you, but it did not receive a response. |
| Letter LP 47 | The IRS is trying to locate the person identified in the letter and is requesting that you provide their new address. |
| Letter LP 59 | The IRS has not received a response to the notice of levy it previously sent. |
| Audit Letter 2205 | The IRS manages audits either by mail or through an in-person interview to review your records. The interview may be at an IRS office (office audit) or the taxpayer’s home, place of business, or accountant’s office (field audit). |
| Letter 915 | You recently underwent an audit, and the IRS informs you that you now owe taxes. |
Key takeaways
- IRS Letter 1226 informs taxpayers that an audit has been closed with no changes.
- This letter confirms that the IRS found no errors in your tax return.
- No immediate action is required upon receiving the letter, but it’s important to keep it for your records.
- Consider consulting a tax professional if you have questions or concerns.
- Maintaining accurate records and avoiding red flags can help prevent future audits.
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