Question

If a taxpayer has not received her 90 day letter, how might she toll interest on a proposed deficiency while still maintaining her right to sue in tax court? How would your answer change if she had her 90 day letter in hand?

Answer 1

Ans :-

A 90-day letter is a Notice of Deficiency issued by the IRS, also known as "Notice CP3219A" or "Letter 531".

IRS issues a 90-day letter in case a tax payer owes some tax, interest or penalty to IRS and has not responded to the notices of IRS in respect of these Tax, interest or penalty due.

Once, the tax payer receives the Notice of Deficiency, he/she gets 90 days to respond to the notice, that's the reason this notice is called 90-day letter.

If the tax payer does not agree with the IRS, he/she might file a petition against this in the Tax court within 90 days of receipt of the Deficiency notice.

So, the tax payer has a right to file petiotion in Tax court until 90 days from the actual receipt of the 90-day letter(Notice of deficiency).

However, once the 90-day letter is received, but the tax payer does not file a petition within 90 days, it is assumed that tax payer agrees with the IRS in respect of taxes due as stated in the Notice of deficiency.

If tax payer does not file petiotion within 90 days, IRS can start collection of tax as shown in the 90-day letter.For collection of taxes, IRS shall issue the tax payer a bill in that respect.