The Senate passed the Internal Revenue Service Math and Taxpayer Help Act , following the bill's passage back in April by the House, sending it to President Trump for his signature.
The IRS MATH Act, would require the tax agency to clearly communicate tax-filing errors to taxpayers, identify the item that's being changed, and explain why a tax refund is higher or lower than expected. This bill requires the IRS to provide specific information on a notice related to a math or clerical error, send a notice related to an abatement of taxes assessed due to a math or clerical error, provide procedures for requesting such an abatement, and implement a pilot program for sending notices of a math or clerical error.
Under the bill, a notice sent by the IRS about a math or clerical error needs to include:
- A clear description of the error, including the type of error and the specific federal tax return line on which the error was made;
- An itemized computation of adjustments required to correct the error;
- The phone number for the automated transcript service; and,
- The deadline for requesting an abatement of any tax assessed due to the error.
The bill requires the IRS to send a notice related to an abatement of tax assessed due to a math or clerical error clearly describing the abatement and including an itemized computation of adjustments to be made to the items described in the notice of the error.
This bill also requires the IRS to:
- Provide procedures for requesting in writing, electronically, by phone, or in person an abatement of tax assessed due to a math or clerical error;
- Implement a pilot program to send notices of a math or clerical error by certified or registered mail; and,
- Report to Congress certain information about the pilot program.
From: NTA BLOG: Erin Collins
“Typically, the IRS issues several million “math error” notices annually — letters informing taxpayers of discrepancies or clerical issues on their returns and summarily assessing additional tax. These notices arise under Internal Revenue Code § 6213(b), which allows the IRS to make quick adjustments without first issuing a formal “notice of deficiency.” While math error authority helps the IRS quickly fix certain mistakes, overreliance on automated or math error assessments shifts the balance away from taxpayer rights and toward administrative convenience. While intended to streamline processing, math error notices carry serious consequences.
It is important for taxpayers understand they only have 60 days to request abatement of the IRS’s adjustment. If they fail to act within that 60-day window, the assessment becomes final, and they generally lose their right to challenge the IRS’s position in Tax Court. Usually, once a tax has been assessed, the taxpayer’s only remedy is to pay the tax, submit a claim for refund to the IRS, and, if necessary, file a refund suit in either the U.S. district court or the U.S. Court of Federal Claims.
Unfortunately, math error notices often leave taxpayers confused or unaware of their rights. Notices can be vague, failing to explain what the IRS changed or why. In some cases, notices have even omitted the critical 60-day abatement information altogether leaving taxpayers uncertain about what action to take.
Clarity and transparency in IRS communications are essential to protecting taxpayers’ rights. This legislation makes that clarity a statutory requirement.”
