I have sent in my letter disputing the IRS's claim and I will need to await their response. In my letter, I did include a filled-out form 8833 noting the clauses of the US Treaty exempting my social security income from being taxable. I also pointed to the IRS note in:
https://www.irs.gov/individuals/international-taxpayers/claiming-tax-treaty-benefits
which specifically indicated that the form was not necessary. I don't know if this was important, but according to the IRS, failure to file a required form 8833 could subject you to a $1,000 fine. Therefore, I wanted to be sure that the IRS understood that inclusion of 8833 was for informational purposes only.
