Letter from IRS

[ddcnga]

I filed my taxes thru TurboTax using the desktop version.  Our only income this year is Social Security, savings account interest and sale of company stock from my former employer where I cashed in approximately $11,200 in stocks (ISO) that were held for more than 5 years. All info was input into TT and I used all electronic forms for income, other than the 1099B,  when asked by TT.  When I filed our taxes, TurboTax refused to pull down the information from Morgan Stanley for the 1099B, so I used the 1099B to fill in the info manually, and following TT instructions and mailed the form to the IRS after our tax return was accepted by the IRS.

Our income is such that we are exempt from long term capital gains. Turbo Tax never changed our refund amount after entering the 1099B info and amount, so I assume that further affirms our exemption from capital gains.  If not, I would expect it would have deducted the tax from our refund?

Then this letter arrived today. It is asking for forms/documents to justify the refund amount (line 25D) on our tax return.  They are asking for a W-2 (neither of us works, only receive SS so no W-2s.) It is asking for a W-2G, Gambling winnings (we have never gambled or won anything anywhere.) It is asking for a 1099R (which we do not have nor did we have any income that would cause us to be issued a 1099R, only the 1099B).  Lastly it says, "Other forms reporting wage or withholding."  Would that be the 1099B and our SSA1099, along with the interest from our savings account (although none of those are actually wages but income)?  

I'm so confused. I truly regret using TT this year with the sale of the company stock, I thought TT could handle it, but I guess not. 

Please help. Thank you.

[SusanY1]

Can you tell us a bit about where the tax withholding came from that resulted in your refund?  Was there "voluntary federal withholding" on your Social Security 1099? (1099-SA)

It sounds like the IRS can't match up the withholdings (or estimated payments) with their records.  

If you see "voluntary federal withholding" on the 1099-SSA, send copies of those with your reply to the IRS.  If you don't see withholding there, send the documents in where you do.  The IRS should be able to then reconcile the data to process your refund. 

[ddcnga]

Yes, we do voluntary withholding that is the exact amount of our tax refund.  Our total income does not match our SSA 1099 totals because I sold the company stock, so I had to include it as income.  Do I also include the 1099B for the stock I sold?

[ddcnga]

And we had the savings account interest added to our income totals also. The letter is a 12C, by the way.

[AnnetteB6]

The only documents that you need to send are the ones that show the tax withholdings.  So, according to the information you shared, you should send copies of your SSA-1099 forms that show the voluntary Federal tax withheld from your Social Security payments.  

Do not send your original documents.  You should keep those and send a copy to the IRS.  

The letter should give you the address for where to send the SSA-1099 to the IRS.

@ddcnga 

[ddcnga]

Let me put in the exact text from the letter and see if you still feel as though I do not need to send anything other than the SSA1099 forms.

"To support the amount of wage or withholding entry of $xxxx, on line 25d of Form 1040SR submit:

-Form W-2, Wage and Tax Statement

-Form W-2G

-Form 1099R

-Other forms reporting wage or withholding"

Would the last request of "Other forms" include the 1099B?

Per the instructions I was given in TurboTax, I mailed a form 8949 and copy of 1099B to the IRS once our electronic return was accepted by the IRS.  I just want to be positive that I'm sending everything they need.

Thank you.

@AnnetteB6 

[AnnetteB6 · Accepted solution]

Take a look at your Form 1099-B and see if there is anything reported in box 4 for Federal taxes withheld.  If that box is empty or zero, then you do not need to send it to the IRS to satisfy the request of any documents showing tax withholdings.  

The Form SSA-1099 should be all that you need to send since you stated earlier that the amount of taxes withheld and shown on that form is the exact amount of refund that you are expecting from filing your return.

@ddcnga 

[ddcnga]

Thank you!

[fanfare]

I received the same letter.

If you don't work, your not going to be able to send a W-2 showing withholding.

IRS is asking for any and all documents showing federal withholding. If you read the paragraph, that's exactly what it says..

It has nothing to do with TurboTax, so don't blame TurboTax.

P.S.

Having responded to IRS notice on  April 1 2024, my issues with IRS was resolved Jan 31, 2025.

That's before Trump started firing workers.

Don't hold your breath for a rapid response.

[fanfare]

For your future information, if you enter the 1099-B details into your tax return,

there is no need to mail  another copy to the IRS.

If you go down the summarize path, you might need to mail the details. depending on what Box Categories you marked

@ddcnga