Do you owe the IRS a lot of money, and they have not contacted you for a long time? That is great! But now they are back with LT38. It was just because they had suspended some notices during the pandemic.
In February 2022, the IRS stopped sending some collection notices while they continued to process tax returns and correspondence because of the Covid-19 pandemic. However, they have been gradually starting to send out reminders again since January 2024.
If you owe individual taxes before the 2022 tax year or your business owes taxes before the 2023 tax year, you may receive one of these notices. So, it is time to remember your tax obligations.
What is IRS Notice LT38?
LT38 is a special reminder from the IRS about outstanding tax balance, not an audit. With this letter, the IRS nudges you to take action on a tax balance you may have forgotten about or have been putting off dealing with. It explains “how much you owe”, “how to contact the IRS”, “deadlines”, and “what might happen if you ignore”.
ATTENTION: In the past, if you received a collection notice like a “CP504 Notice of Intent to Levy” from the IRS and these notices were stopped, the next notice you receive could be the “LT11 Final Notice of Intent to Levy”. That means, if you do not make a payment by the specified deadline on LT38, the IRS may start taking action against your assets. You will have 30 days to find a resolution or request a CDP (Collection Due Process) hearing.
How Can You Respond Effectively to an IRS LT38 Notice?
- Read the LT38 carefully and understand the instructions on your notice. The notice will explain everything about what you need to do next. Make sure you follow them.
- As soon as possible, gather any document they request from you and file any missing tax returns.
- Double-check everything you did. Is all information and documents complete and accurate?
- If you need help, contact a tax lawyer to find the most suitable options for your situation.
- Pay your unpaid balance by the deadline stated in the notice. This will stop extra interest and penalties. Need more time? Ask for an extension from the IRS.
- Keep a copy of the notice, gathered documents, your emails, etc.
IRS LT38 phone number: (800) 829-1040
Payment Options for IRS LT38
Visit the official IRS website and use their online payment portal. Once you open the page, you will see the “Pay now with direct pay” or “Pay now by card or digital wallet” options. Choose the suitable payment option for you.
Keep in mind that paying online is usually the fastest and easiest way, and you will receive a confirmation right away. But you can also send a check or a money order by mail. It is up to you.
Can You View IRS Notices Online?
Yes, you can. All you need to do is sign in to your online account. If you are a new user, create an account but also have your photo identification ready.
In the online platform, you can access your tax records, make and view payments. View your balance, or manage various details about your tax responsibilities. That is, you will also find LT38 or other notices here.
Highlight: If you paid your balance in full within the last 21 days, you can ignore the LT38 you received.
What If I Cannot Pay the Balance In Full?
Pay what you can now. It is always better than not paying anything. However, for financial hardships, the IRS also provides payment plans.
Next, we will talk about payment agreement options based on financial situations.
Feeling Overwhelmed?
IRS Fresh Start Program 2024 and IRS Forgiveness
The IRS is not the bad guy; it wants to create a solution for both sides. That is why, it has programs for forgiveness or fresh start. You can apply by submitting the necessary forms to support your claim. Then, the IRS will review your case and decide if you qualify for a reduction or forgiveness in the amount owed.
Will the IRS Forgive Penalties and Interest?
It may forgive some penalties and interest under certain conditions. For example, if you can show that you had a good reason for not paying on time, such as serious illness, the IRS might reduce or remove these extra charges.
IRS One-Time Forgiveness
This program’s purpose is to give taxpayers a second chance by waiving penalties that might have been added due to late payments or filing errors. If you made a mistake or missed a deadline just once, it is good to manage your tax debt.
Sure, you must have a clean record with the IRS over the past few years. This means no previous penalties, no late filings, and no other serious tax issues. If you meet these conditions, you can apply by filling out the necessary forms and explaining why you missed a payment or filing deadline.
Remember to use it wisely because one-time forgiveness is only available once. And this program does not cover all types of taxes or penalties, so make sure it applies to your situation before you apply.
What is the IRS Fresh Start Program 2024?
It is a tax relief option for taxpayers who are struggling to pay tax debts. Once your application is accepted, the IRS notifies you about payment options.
- Offer in Compromise (OIC) helps you settle your tax debt for less than the full amount you owe.
- If you owe less than $50,000, you may qualify for an Installment Agreement. Before applying online, read our article about eligibility for installment agreements. Here is the Installment Agreement Request PDF.
- Currently Non-Collectable Status can allow you to defer paying your tax bill for a time. However, this status does not stop any tax debts; it just provides you more time to find a better financial solution.
- Penalty Abatement provides penalty relief.
To learn more about it, please read our detailed article about IRS Fresh Start Program.
Tips for Avoiding Future IRS Notices
- Keep accurate tax records. Always organize all documents (income statements, receipts, and other records that support your tax filing) in a way that is easy to find, so you can quickly provide proof as the IRS asks for it.
- Always file your tax return by the deadline. If you can’t file on time, ask for an extension. Besides, get help from a tax expert to learn your rights and options.
- Take time to check your financial statements for any errors and missing information. Doing this regularly helps you catch mistakes.
- Do not ignore any IRS notices.
Do not let LT38 IRS cause you a headache! And the longer you wait, the more complicated it can get. The whole process will be smoother with Precision Tax Relief’s lawyers. We have managed thousands of similar cases, so we can guide you in the best way.
Call us for your free initial consultation.
