ot: has anyone ever been audited by the IRS?

[AnnieW625]

This is in regards to our 2007 federal income taxes. We got a notice today stating that we owe $4,966 on or before December 16, 2009. The issue is that the IRS claims that we did not pay a total of $28,702 in mortgage interest in 2007. They claim that we only paid Citi Mortgage (our second loan holder) a total of $7,281.00 . Right now it looks like all they need is proof that we paid American Home Mortgage Servicing, Inc. (our main loan holder) the rest of the interest we claimed. I sent a message to AMHSI requesting the document because the 2007 mortgage interest statement I used (probably printed off the computer) can not be found. Shouldn't AHMSI provided that to the IRS already?

FWIW we use Turbo Tax and have been doing so since 2003. I have never had a problem with it. I also went back into Turbo Tax and printed out the mortgage interest worksheet to prove that we paid another loan holder interest in 2007.

So is there any way if I can prove to the IRS that we did pay the remaining $21,421 in interest in question that they will tell me I might still owe them money?

At this time because I believe I should have all of the proof I need to prove we filed our taxes correctly I am not going to consult a tax attorney (although I do know one) or should I consult a tax attorney anyways?

TIA

[dhano923]

Having the IRS recalculate taxes owed isn't the same as being audited. An audit is when they want verification that what you claimed is correct, either because you are under suspicion for some reason or you were randomly chosen. They request documents, copies of receipts, and you meet with someone to present those items. A recalculation is when your numbers don't match the info they have on file. We've had our taxes recalculated twice before because one of DH's former employers kept changing the amount on his W2, even after we submitted our taxes.

Just call the IRS, give them your letter number (shown on the letter you got) and they will pull up your account. Explain the situation and ask what documentation they need from you, or if your mortgage holder needs to provide it for you. They are actually very helpful.

[kozachka]

Ditto, this is not the same as audit. Get a copy of the mortgage statement, mail it to IRS and keep another copy on file.

[dcmom2b3]

My mom has had similar notices and it's been pretty easy to resolve. We sent in the documentation re the mortgage interest deduction -- the 1098 from the lender, a copy of a mortgage document that indicated she was obligated on the mortgage -- along with an explanatory letter. They were satisfied and went away.

Check with your mortgage co., though, to make certain that they're reporting the interest under your SSN (or your spouse's if you're filing jointly). That's how mom's problems started. After dad died, the mortgage co was reporting the interest under his SSN, while mom was filing under her SSN as single. So the IRS didn't match it up.

[clc053103]

Yep, that's definitely different than an audit- and should be quickly resolved with documentation.

This is happening more and more (both recalculations and audits)- it was explained to me by my accountant and also financial advisor that when Bush was in office, he signed off on hiring more auditors at the IRS so they could scrutinize and audit more tax returns.

[trales]

This has happened to us twice, it is no big deal at all, send them the stuff and keep a copy. It will all be over soon.

[mominmarch]

We are going through the same things now. And honestly, we seem to go through this about every other year with either the IRS or some state tax agency (I have to pay state taxes in 11 states because I am a partner in a lawfirm that has offices in each state, so some of that income is attributed to me). I hate taxes with a vengeance.

But like others have said, yes, you are not getting audited. And you don't need a tax attorney.

But you do need to call them, and have a good 30 minutes to do so, try not to let the voice menu system irritate you, and have all of your paperwork there. There is a chance that they have the original document in the file and will just "find it" as you talk through it and that will be the end of it. If not, you will need to get a sheet from the primary mortgage holder (not a print out from your computer or their website) and send it to them. Your primary mortgage holder will still have this record (1099 I guess) so they can send it to you and you, in turn, can send it to the IRS.

[AnnieW625]

Thanks so much! I see the difference now. One thing I did notice with Turbo Tax is that it doesn't automatically print out the Mortgage Interest paid screen with your taxes. Next year I will be printing that out and including it in our tax packet. Hopefully I'll get the form I need from the mortgage company pronto.

[codex57]

Ditto, this is not the same as audit. Get a copy of the mortgage statement, mail it to IRS and keep another copy on file.

Yup. I see that all the time. The mortgage company should have sent notice to the IRS, but things slip through all the time. Might not even have been the mortgage company's fault. IRS and FTB screw up all the time too.

Just get documentation, send it in to the IRS (you can always tell them you're getting docs to ease your mind; the reps will just say "ok, send it in as soon as possible").

It's no biggie really.