IRS Letter 5041 – Follow Up Notice
The IRS needs additional information on the unusually low portion of gross receipts from non-credit card sources (cash, checks).
Type of Notice: Return accuracy
Likely next step: Address a business audit
Also see: Business penalties, Unpaid business taxes
Why you received IRS Letter 5041
- You received income through a credit card merchant account and/or through other third-party network transactions.
- You filed a tax return reporting business income.
- The IRS thinks that your tax return shows an unusually high portion of gross receipts attributable to credit card payments. The IRS would typically expect a higher portion of gross receipts from cash and checks for your type of business.
- Letter 5039 was sent to ask you to complete Form 14420, Verification of Income and you responded.
- The IRS sent Letter 5041 as a request to provide additional information. The notice lists the specific items you need to address. You can use the attached Form 14420 to complete the outstanding items.
Notice deadline: 30 days
If you miss the deadline: Failure to respond may result in the IRS auditing the tax return or sending a notice proposing additional tax, penalties and interest.
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