Here with The Oasis Firm, we do our best to help and make our clients’ lives easier. Part of our job is to check our clients’ refund status, and the only way for us to do that is by checking the IRS website. It usually takes within 21 days for you to receive your refund. Unfortunately, there are clients who still have not gotten their refunds after more than 21 days.
If you are one of these clients, your refund may be on hold. The reasons for keeping your refund on hold is procedural and it has nothing to do with auditing. Rather, it is the IRS’ way of preventing fraud.
If you are flagged by the IRS, they will send you the “5071C” letter. This is not an audit letter, it is important to pay attention because it is an important step to get your money. This is just a reminder and this notice only comes as a letter. You will not receive it via email or text.
To process your refund, the IRS just needs to verify your identity. The 5071C letter informs you that there are 2 ways to do this.
The first method is online verification. Just go to their Identity Verification Service and register. It is a 24 hour service and you can register at any time. Registration is a requirement before you are verified. Prepare all of the documents needed to complete the registration. You should have a copy of the 5071C letter, and the income tax return for the year shown in the letter. If you did not file an income tax return, you can indicate that on the service’s website.
The second and better option is to call the toll-free IRS Verification telephone number. The 5071C letter states that you should reply within 30 days, however, the IRS will still work with you on the refund even after the set period. You should expect to have a long wait on the phone. Once you get through, there will be several questions you need to answer.
You should have the following documents with you when you make the call:
- 5071C letter;
- tax return that was mentioned in the letter, for the particular year;
- the prior year’s income tax return. This is different from the income tax return stated in the letter;
- any supporting document that was referenced in the above tax returns.
As much as we, The Oasis Firm, would want to represent you before the IRS, in this situation we cannot make the phone call for you. However, as an authorized party, we are allowed to be on the call to assist you with the discussion.
You might ask, “Who is the IRS targeting?” Well, it seems like these are people who have recently had life changes like getting out of jail, a move, marriage or divorce. In the worst case, there is the possibility of identity theft. But in some cases, it could be just random. One example is, if you had gotten divorced and got married again, there could be a possibility that their system would not have a record of you getting married again. So you have to answer questions to prove and verify your identity.
So what happens if you do not verify or you cannot verify successfully? Well, if you do not verify, the IRS will not be able to process your tax return, issue funds, or credit any overpayments to your account. If you are not verified successfully, then you have to book an appointment with the IRS and bring the necessary documents to their office.
Once your identity is successfully verified by the IRS, they will process your tax refund and you will receive it in 3 weeks, but this will likely come by mail and not a direct deposit to your bank account.
So please, once you receive the “5071c” letter, please make that important step!