Letter 5599: How to Resolve IRS Account Issues

Last updated 11/01/2024 by

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Summary:

IRS Letter 5599 is issued during an audit review when discrepancies are found in your tax return or if further clarification is needed. The letter typically outlines changes to your tax return or requests more information to process your audit accurately. Receiving Letter 5599 is a critical moment for taxpayers, as it can lead to significant tax adjustments, penalties, or further investigations if not handled properly. This article will help you understand what Letter 5599 entails, how to respond, and the actions to take to resolve it promptly.

Receiving an IRS letter is never a pleasant experience, especially when it involves an audit. Letter 5599 can be particularly unsettling because it indicates that there is a discrepancy or issue with your tax return that requires your immediate attention. Often, it’s part of an ongoing audit, and how you respond can greatly influence the final outcome of your tax situation. This guide provides a thorough explanation of IRS Letter 5599, its implications, and how to address it to avoid penalties or further complications with your taxes.

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What is Letter 5599?

IRS Letter 5599 is a formal communication used by the IRS in the context of tax audits. It is typically sent to taxpayers when the IRS requires additional information or has made adjustments to your tax return based on an audit review. Audits can occur for various reasons, including discrepancies in reported income, unverified deductions, or potential fraud. The letter often contains the IRS’s findings, proposed changes to your tax return, and requests for further documentation to verify claims or correct errors.

The main goal of Letter 5599 is to inform taxpayers about audit findings and give them an opportunity to respond before the IRS finalizes its decision. It serves as a final notice before the audit’s conclusion, allowing taxpayers to submit additional information or challenge the IRS’s findings if they believe an error has been made.

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How Letter 5599 affects you

Receiving Letter 5599 indicates that your tax return has been flagged for audit and that the IRS has identified issues that need clarification. This letter can affect you in the following ways:

– Delayed Refunds: If the IRS is reviewing your return, any refunds you’re expecting will likely be delayed until the audit is resolved.
– Tax Adjustments: The IRS may propose changes that could increase your tax liability. This can lead to additional taxes owed, along with potential penalties and interest.
– Penalties and Interest: Failing to respond or resolve the issue outlined in Letter 5599 could result in penalties for underpayment, along with accruing interest on any additional taxes owed.
– Further Investigation: If discrepancies are not adequately addressed, the IRS may escalate the audit or even pursue further legal actions depending on the severity of the issues identified.

It’s essential to take this letter seriously and respond promptly to avoid these outcomes.

Pro tip

Always respond to IRS Letter 5599 within the specified deadline to avoid further penalties or delays in processing your tax return.

What should you do when you receive Letter 5599?

Here’s a step-by-step guide to handling IRS Letter 5599 effectively:

Read the letter carefully: Take note of the specific issues the IRS has highlighted. Ensure you understand the nature of the audit, the proposed changes, and the documentation or responses they’re requesting.
Gather supporting documents: Review your tax return and gather any documentation that supports the information you originally provided. This may include receipts, bank statements, or other records that can verify your claims.
Respond to the IRS: Submit the requested information promptly. You can mail in the documents along with a written explanation addressing the IRS’s concerns. Make sure to keep copies of everything for your records.
Consult a tax professional: If you’re unsure about how to respond or if the audit seems complex, it’s a good idea to consult a tax professional, such as a CPA or tax attorney, who can guide you through the process.
Request an extension if needed: If you need more time to gather documents or respond, you can request an extension by contacting the IRS. They are often willing to provide additional time as long as you are cooperative and transparent about your situation.

Acting quickly and accurately is key to resolving any issues without facing additional penalties.

How to respond to Letter 5599

Steps to take when responding to Letter 5599

When responding to IRS Letter 5599, it’s important to stay organized and follow the steps outlined by the IRS. Typically, you will need to:

1. Review the IRS findings: Understand the specific changes the IRS has made or proposed to your tax return.
2. Gather necessary documents: Collect any paperwork, such as receipts or tax forms, that can support your case.
3. Write a response letter: Include a formal letter explaining why you disagree with the IRS’s changes or why certain deductions or claims were made. Be specific and provide references to the tax code if possible.
4. Mail everything to the IRS: Send your response along with the requested documentation by the deadline provided in the letter. Make sure to use certified mail to track your submission.

Other ways to handle Letter 5599

In addition to responding by mail, there are other options for dealing with Letter 5599:

– Phone the IRS: If you need clarification or guidance, you can contact the IRS directly using the number provided in the letter. They may help expedite the process if your case is urgent.
– IRS Appeals: If you disagree with the IRS’s findings and your response does not resolve the issue, you may be eligible to request an appeal. This involves presenting your case to a higher authority within the IRS for review.

In either case, acting promptly and providing thorough documentation will help ensure that your audit is resolved efficiently.

Pro tip

Make copies of all correspondence and documentation sent to the IRS. These records are essential if you need to appeal or clarify any issues later.

Further support options for addressing Letter 5599

If you find the process overwhelming or need professional assistance, there are several resources available to you:

Tax Professionals: CPAs, tax attorneys, or enrolled agents can represent you before the IRS, helping you navigate the audit process and ensuring that you respond correctly to Letter 5599.
IRS Taxpayer Advocate Service: If you’re facing difficulties in dealing with the IRS or believe that your case is causing unnecessary hardship, you can contact the IRS Taxpayer Advocate Service for additional support.
IRS Website: Visit the IRS’s official website for more detailed guidance and forms you may need to complete the audit process.

Professional help is particularly beneficial if your audit involves complex tax issues or you believe the IRS has made an error.

Potential penalties or next steps if you don’t respond

If you fail to respond to Letter 5599, you could face serious consequences:

Delayed Refunds: Any refunds you are expecting may be delayed indefinitely until the audit is resolved.
Additional Penalties: You may be subject to penalties for failure to respond or underpayment of taxes. Interest will accrue on any unpaid amounts.
IRS Enforcement: In extreme cases, the IRS may take enforcement actions such as garnishing your wages or placing a levy on your assets.

Responding in a timely manner is crucial to avoid these outcomes and keep your tax matters under control.

Pro tip

If you’re unsure how to proceed or if the situation becomes complicated, seeking guidance from a certified tax professional can help ensure a smooth resolution.

What potential outcomes are possible?

Once you’ve responded to Letter 5599, there are a few possible outcomes:

If you provide sufficient documentation: The IRS may accept your response, adjust their findings, and conclude the audit without further actions.
If the IRS finds an error: The IRS may modify their findings and issue you a corrected tax bill, which could include additional taxes owed, penalties, or interest.
If you disagree: You may request an appeal or challenge the IRS’s findings in tax court, especially if you believe they’ve made a significant error.

Taking prompt and thorough action will help ensure the best possible outcome for your situation.

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Frequently asked questions

Why did I receive IRS Letter 5599?

IRS Letter 5599 is typically sent during an audit when discrepancies in your tax return are found. The letter requests further information or outlines changes the IRS has made to your return based on their findings.

How should I respond to IRS Letter 5599?

To respond, gather the requested documentation, write a letter explaining your position, and send everything to the IRS by the deadline. You can also request an extension if needed.

What happens if I ignore Letter 5599?

Ignoring the letter could lead to delayed refunds, penalties, and interest charges. In some cases, the IRS may take further actions such as wage garnishments or asset levies.

Can I resolve this issue online?

In some cases, you can resolve issues with the IRS online using their secure portal. However, for most audits, you will need to send physical documentation as outlined in the letter.

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.

IRS Letter or Notice Number

Notice Description

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 5599 is part of the audit process and requires prompt attention to avoid penalties and delays in refunds.
Gather supporting documents, respond promptly, and consult a tax professional if needed.
Failure to respond can lead to additional penalties, interest, and potential legal action.
Timely and accurate responses can lead to a favorable audit outcome or reduction in tax liabilities.

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