Some taxpayers who filed tax returns for 2021 using the married-filing-jointly filing status may receive or have already received an IRS notice CP14 erroneously demanding a remaining tax balance owed or an incorrect amount owed, the Service said in a statement posted on its website Wednesday.
Generally, the error occurs when a payment was made by a spouse who was the second-listed taxpayer on the return (secondary spouse). The IRS said its programming does not credit payments made by the secondary spouse to the couple's joint account when they are either (1) not made electronically; (2) made electronically but posted "before the joint return indicator is present to identify the primary taxpayer"; or (3) made by the secondary spouse via the Make a Payment feature of an online IRS account.
Affected taxpayers who have fully paid the correct amount of taxes due do not need to respond to an erroneous notice, the IRS said. Those who paid only part of their taxes due should pay the remaining correct balance either in full or enter into an installment agreement or other collection alternative. Taxpayers with an online account under the Social Security number of the taxpayer who made the payment can check the account to ensure the payment was credited.
Although it does not refer specifically to this glitch, a Tax Tip posted by the Taxpayer Advocate Service (TAS) on July 22 advises taxpayers generally on how to deal with a CP14 notice.
"The first thing to know is don't panic!" the article urges.
And it implies some notices may be erroneous. Under a subheading "What should I do if I receive a CP14 notice by mistake?" TAS recommends taxpayers retain the erroneous notice and verify their taxes were in fact paid and credited properly, which can be done with an IRS online account.
— To comment on this article or to suggest an idea for another article, contact Paul Bonner at Paul.Bonner@aicpa-cima.com.