In January, the Internal Revenue Service started sending taxpayers letters regarding the amounts they received on advance payments of the Child Tax Credit. The IRS requested that taxpayers use this information to fill out their 2021 tax return. However, it has been found that these letters may have outdated information listed on them.
Due to the error that occurred, the IRS has relaunched a website for the Child Tax Credit with up-to-date information on the amounts that taxpayers should put on their returns. The IRS is also requesting that individuals use their online taxpayer accounts to collect information that they can use to complete their tax return.
For those being impacted by advance child tax credit payments, you should receive Letter 6419 which provides the total amount of 2021 advance Child Tax Credit payments and the number of qualifying children used to calculate these payments. Those who received this document last month should be aware that these may contain outdated information, especially if your check or direct deposit payments were undeliverable, if you recently changed bank accounts, or if you recently moved.
If you have questions or concerns regarding the letter you received, the IRS is asking you go to www.IRS.gov and login to your account for up-to-date information. It is currently unclear how the IRS is going to notify taxpayers and preparers that they need to go to the website for updated information when individuals were recently informed by mail to rely on the information found in their letters.
The IRS may need to mail out a follow-up letter in order to spread the word that taxpayers may not be able to rely on the letters that they received. The biggest concern is that individuals may not be aware that their letter is incorrect if the IRS doesn’t send out some type of notification to those affected.
Earlier in January, the coalition of 11 accounting and tax professional groups mailed a letter to the IRS requesting that they discontinue automated notices, give taxpayers relief from penalties, offer reasonable cause penalty waivers, and more. The coalition hopes that the IRS will be more thoughtful moving forward when it comes to taxpayer service issues. Overall, they hope that the IRS will take a better customer service approach so that they can take care of taxpayers and provide them better access to the resources they need.
One large barrier for many parents who are forced to rely on the Child Tax Credit web portal is technology. Some individuals do not have access to the proper technology to E-File their returns so using the web portal will be difficult. Besides this, if they do not have the proper technology that allows them to be notified of the error that occurred, then they may never know that their letter has incorrect information listed thus negatively affecting their tax return.
The coalition found that 40% of individuals prepare their own tax returns. This means that some individuals will not be notified that they need to visit the web portal for up-to-date information regarding the Child Tax Credit as they do not have a tax professional to make them aware of the potentially erroneous data.
The coalition believes this is a big customer service issue especially when it comes to minority taxpayers as they do not have the resources to comply with the changes. In conclusion, the coalition feels that if the IRS follows their recommendations to having better customer service and providing notifications when changes occur, then these concerns can be addressed and resolved more efficiently.
If you received a notice giving details for your child tax credit, be sure to double-check the information on the IRS website to verify the accuracy of the information.
