To assist taxpayers and practitioners, the IRS will provide taxpayers with transcripts of the information that the IRS has on file. There are three main types of IRS transcripts that taxpayers should be aware of before checking their account. These are IRS account transcripts, IRS return transcripts, and IRS wage and income transcripts.
The most important transcript for checking activity on your account for any given year. Reports when the return was filed, when any payments made on the account were received, the balance owed on the account, the assessment date of any liability, penalty assessments, adjustments made by the IRS, when representatives were appointed, and most other activity on the account. IRS account transcripts are available for most types of returns filed and can either be requested over the phone (via fax delivery or US mail), online, or by submitting a transcript request via US mail.
IRS account transcripts should be reviewed thoroughly to ensure that all information is correct on your account. The first thing that you should check for is to make sure that your return appears on this transcript as being filed. This will ensure that your return has been received and processed by the IRS. Also, you should check your transcript to ensure that you have been credited with any and all payments, collections proceeds (wage or bank levies), and any refunds that were issued on the account. It is not uncommon for the IRS to make a mistake on an IRS account transcript and I have seen several IRS account transcript errors in my time practicing tax law. You want to make sure that all payments and credits are correctly applied to your account so that you have an accurate account balance of what is owed.
If you are still having difficulty understanding how your liability was calculated, you have a number of options. Calling the IRS directly (1-800-829-1040) and having them explain the liability is one idea. In addition, you can visit your local IRS office for an in person explanation, seek help from a local volunteer tax clinic, or consult with an experienced tax attorney or CPA. When verifying the information on your IRS account transcript, it is a good idea to have tax notices, cancelled checks, and bank records at your disposal. If your calculations do not match what the IRS has on file, contact the IRS immediately to remedy the problem. Prepare an explanation of what you believe is incorrect about your account and attach any and all supporting documentation supporting the discrepancy.
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