This might include: If the IRS takes your tax refund to satisfy one of these debts, it will send you a Tax Topic 151 letter to explain why. While filing within the IRS is probably the simplest way to appeal the IRS action, well give a brief rundown of the steps for both. Please read both of these documents as the changes affect your legal rights. Do you have more questions about your Tax Topic 151 letter? If you choose to pursue the option of filing a formal written protest, it is important that you read your IRS letter carefully, as there will be a given window of time in which you must send your response. Topic 152 is a code that the IRS uses to tell the status of each group of refunds. Topic 152 is a general reference code that some taxpayers may encounter while attempting to utilize the IRS refund status service. On the IRS 's webpage for Topic No. It's quick, easy and wont cost you anything. You have 30 days to respond in writing to the IRS. Your first step is to contact your local Appeals Office. Many Americans rely on their tax refunds to make ends meet, and an unexpected Tax Topic 151 notification can be quite financially unsettling. How To Get a Personal Loan With Fair Credit, How to Use a Personal Loan to Build Credit. If you choose to submit a small case request, fill out Form 12203, and outline your disagreements. This preview shows page 42 - 44 out of 89 pages. In addition, the BBB-accredited firm has a team of over 15 Enrolled Agents standing by, waiting to provide the help you need. Tax Topic 151 Letters communicate the IRSs intent to withhold a portion or all of your tax refund to satisfy a debt owed to the government, like unpaid taxes, child support or federal student loans in default. Having a tax professional help you file your appeal will prevent you from making mistakes that could cost you. The benefits of working with the Independent Office of Appeals include: Representatives there are trained to take your perspective into consideration, as well as that of the IRS. If you instead opt to file an appeal with the courts, you may do so within 90 days. 2021 - 2023 Banks.comAll Rights Reserved. This can be a time-consuming task, but its a critical one. Is tax Topic 151 bad? June 4, 2019 12:44 PM. Please be aware that there are reported 40 minute average hold times. Or, you might discover that the debt was equal to or larger than your refund, and you will not receive any money from the IRS at all. Your best bet it to wait until the IRS contacts you via letter which can take up to or more than 4 weeks for you to receive it. These legal professionals will understand how to appeal to the IRS and can help you navigate these next steps. Should You Use a HELOC to Pay Off Credit Card Debt? Frequently Asked Questions. The IRS is letting you know that it is reviewing your tax return and that your refund might be affected due to outstanding debts that you owe. But if money is still owed after your return is withheld, the IRS could pursue further collection action. If you can, you should try to resolve what caused the tax offset by paying off that debt, along with penalties and interest accrued. If the IRS decides to continue with the classification, youll get a more detailed explanation that clearly outlines whyits made this decision. In that case, they will notify you in the second letter and send your entire refund. There are a few outcomes you may experience after filing your federal income tax return with the IRS. The first step is to request an appeals conference through a small case request or a formal written protest. The code or tax topic indeed indicates that you should take action, but that should not be a bother. John, If you've recently received this notification in the mail, there's a chance that your taxes will end up getting offset. In this case, there are three potential institutions to which you could appeal your case: The U.S. Tax Court, the U.S. Court of Federal Claims, or your U.S. District Court. ZERO SPAM, UNSUBSCRIBE AT ANY TIME. Can Debt Collectors Take Your Tax Refund? An item is tax-deferred when the taxes are not collected until the funds are withdrawn. Official movie trailer for the shocking new full length movie from B.A. This blog does not provide legal, financial, accounting, or tax advice. Here are the answers to the most asked questions about Tax Code 151 and what to do if you received a Tax Topic 151 letter. If youve received this notice, it means that your tax refund is either being reduced or withheld entirely by the Department of Treasury so that they can use it to pay for things that they believe you owe. What does Topic 151 mean from the IRS? Finally, the second letter will also define the options that you can choose to take in response to the letter. Deductibly Yours, If the debt is large or the situation complex, seeking professional advice and enlisting the help of a tax professional will be essential. Compare real offers from multiple lenders. Filing an appeal to the courts can be an option if you have already tried and failed to reach a resolution at an appeals conference, or if you prefer to bypass the appeals conference altogether and appeal directly to the court system. Irs still reviewing my return 1242 Tax Topic 151 simply implies that you are receiving a tax offset, which may result in a smaller refund than you anticipated. If you have any sort of dispute with the IRS or believe the agency is taking an unjust action against you, its smart to go directly to this office. The first letter you receive from the IRS should explain if you qualify for a Small Case Request, and how to proceed. If the total amount due for any tax period is less than $25,000, then you can go this route. The first step to request an appeals conference in the instance of tax topic 151 is usually to file a small case request or a formal written protest with the appropriate office that was outlined in the IRS letter you received in the mail. Do you currently owe a tax debt that youd like to resolve, or have other important tax questions you need answered? Sitemap, Need Tax Help? While Tax Topic 152 indicates that you will get a tax refund following IRS . Then, mail it to your listed Appeals office by the deadline listed. Weve been helping people just like you for over 30 years. If you disagree with any of the information outlined in the letter, take note of those details for later. Instead, wait until you receive the second notice so youll know how to move forward. 1242. Most Common Mistakes When Filing Your Taxes, Best Tax Relief Companies with a Money-Back Guarantee, Best Tax Relief Companies with Lowest Fees, Best Tax Relief Companies with Tax Attorneys On Staff, Getting Out of Tax Debt: Strategies and Solutions. You should work with qualified tax attorneys who are experienced in tax court litigation and defense services. Best guide on how to become health information technician. If you choose to appeal directly with the IRS, you must do so within 30 days of receiving the Tax Topic 151 letter. There are two reasons why you might receive an IRS letter addressing Section 151. They will send you a letter that explains why you won't be getting your refund, or how much of the refund was taken. Before we dive into how to exercise your appeal rights, lets answer a basic question: Whatis IRS Tax Topic 151 and what does it mean? According to the IRS, 9 out of 10 tax refunds are processed in their normal time frame of fewer than 21 days. There are several reasons why you would receive a tax refund offset and have your refund taken or reduced. Did you receive a Tax Topic 151 letter in the mail, or did you receive a Tax Topic 151 alert when you attempted to log into the IRSs Wheres My Refund tool? If so, its important to understand your right to appeal. This editorial content is not provided by any financial institution. If youve recently received this notification in the mail, theres a chance that your taxes will end up getting offset. TaxAudit does not warrant or guarantee the accuracy, reliability, and completeness of the content of this blog. We created the Wiztax system to allow anyone to start the process of getting their tax issues resolved online and filed without having to spend thousands on high priced lawyers or tax resolution firms. To determine this score, the . Receiving a Tax Topic 151 letter is one of those consequences. Dave also holds a Master of Arts in Education and has been educating people since 1972. I understand the cruise industry has had its share of issues due to the pandemic but at these prices and needing to add airfare and trip insurance this is no longer an affordable vacation compared to other options. Is it good or bad? You will receive an official IRS letter/report outlining the specific offsets and changes made to your tax return, as well as instructions on how to appeal. Administrative Agencies, the Separation of Powers, and Chevron Deference. He is a frequent and popular guest speaker for the California Society of Tax Consultants, the California Society of Enrolled Agents and the National Association of Tax Professionals. So, it would be best if you took action to resolve the debt you owe. As such, you may notice that the amount on your refund check is lower than you expected. As long as you respond to the letter within 90 days, your case is valid. California Small Business Tax Guide: Your Questions Answered, Your Guide To 401(k) Hardship Withdrawals, How Enrolled Agents Can Help You with Tax Problems, A copy of the Tax Topic 151 letter and related tax years, A written statement expressing your intent to appeal the withholding, The reason for your appeal and any relevant references to tax laws. There are three different court systems you may work with if you file a case against the IRS. There should be no cause for worry. While tax avoidance is the process of minimizing your taxable income through legal methods, tax evasion is the illegal underpayment or failure to pay taxes. The tax is quite expensive, think mine is around 26 quid a month. It will also let you know how to appeal this action. We only index and link to content provided on other servers. Do you disagree with the IRS offset, the debt outlined in your letter, or something else? The offers that may appear on Banks.coms website are from companies from which Banks.com may receive compensation. 32813 Middlebelt Rd Suite BFarmington Hills, MI 48334855-900-1040Michigan Law Office, 4005 Guadalupe St Suite CAustin, TX 78751Austin, TX Law Office, 2022 Silver Tax Group. Topic 152 is a generic reference code that some taxpayers may see when accessing the IRS refund status tool. This video was also made on the basis of these guidelines. If you know about and agree with the debts listed on the tax topic 151 letter, then work to get them resolved. IRS trouble can be frustrating and intimidating. See if you qualify for student loan refinancing and compare real time offers. If you request an appeal, youll need to support your position with documentation. Below, learn more about what Tax Topic 151 means and what to do if you get this IRS notification. 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