What is a shortage notification?
The deficiency notification is a formal announcement of the income agency that the taxpayer currently has an outstanding balance on his tax account. This type of document is usually structured so that the taxpayer is also informed about various options related to the amount due, including questioning the claim. In the United States, the Internal Revenue Service uses a lack of shortage together with a number of individual countries that prepare documents that carry similar titles.
The main purpose of the lack of notification is to notify the taxpayer of the current tax liability. In most cases, the obligation concerns taxes due to the previous period plus all sanctions and interest that has been applied by the date of notification. The details contained in the document are given the tax period related to the balance. If more periods have outstanding tax debt, each of these periods and the relevant balances are listed in the text.
Receiving a shortage notification is not necessarily a hint that there has been some attempt to avoid tax liability or leakage. The origin of the error can be something as simple as the use of an outdated tax table or even less extra errors or subtraction. In some situations, errors in tax calculations are discovered later, which requires adjustment. If this arrangement meant that more taxes are due for this particular tax period, the notification is sent as a means of warning the taxpayer, which allows to prevent further accumulation of sanctions.
After receiving a shortage notice, three options are usually submitted to the taxpayer. One approach is to verify the amount listed in the document and pay the entire balance required by the income agency. If the taxpayer feels that the amount found in the notification is incorrect, he can follow specific procedures to question balance and quotedata that supports its position.
The third alternative is to contact the income agency and develop a type of repayment plan, allowing retirement taxes to be retired in monthly installments for several months. This last option usually means that interest and sanctions continue to increase from an outstanding balance, but these sanctions and interest can be competitive with the cost of accepting the repayment loan due. In this case, working with the income agency is usually faster and easier than to pass the loan application process.