Michael Lodge, NCPM, CRTP: According to recent reports, the IRS has a backlog of more than 6 million unprocessed individual returns; however, it has opened the majority of its mail and processed the payments accompanying these returns. As a result, many taxpayers received a CP-80 notice, which states the IRS has a credit on the taxpayer’s account but has not yet received a 2020 tax return. In most cases, though, the IRS has received the tax return, but just haven’t processed it.

This erroneous notice contains more conflicting information, as the CP-80 notice states, “Please file today. Send your signed tax return to the address shown on the top of your notice.” However, the IRS has stated in many news releases NOT to resubmit a tax return. The notice also states “If you don’t file your return or contact us, you may lose this credit. The Internal Revenue Code sets strict time limits for refunding or transferring credits.”

In addition, NATP (National Association of Tax Professional) has heard reports of taxpayers receiving their payments back in the mail from the IRS. Other taxpayers have received, in addition to the CP-80 notice, failure to file notices resulting in penalties, liens, etc.

NATP reached out to our IRS liaison to find out what taxpayers and tax professionals should do when these situations occur. We’ll be in communication with our members when we receive additional guidance.

I have had my own clients experience this same situation where they filed the tax return, sent the check, and the IRS sends them a letter that they did not file. I will keep you informed as this is addressed by the IRS.