I have never received Letter 12C in the past, requesting verification of Federal Taxes withheld, each and every letter relates to a 1099-R and SSA-1099. The payers would have reported the Federal Tax withheld and the IRS should have this information. Is anyone else getting these letters this year? Very time consuming to respond and then to find out the IRS will take 6-8 weeks before processing their return after mailing in copies of the 1099-R and SSA-1099's. WHY!!! Is this a problem with the software or is the IRS just being ridiculous?
I had one last year that I sent in documentation 3 times for, they still only credited withholding on one of the damn forms, it seriously took until just last month to finally straighten out his 2022 refund...and now hes got the same damn letter again for 2023!!!
Same 1099s as hes had every year for a decade, suddenly the withholding isnt appearing in his account. Its crazy!
client of mine just got one. first i ever had an issue.. the guy has zero taxable income yet withholds like $ 7,000 from social security and IRA withdrawal.. I tell him he can stop the withholding but he says "He likes the refund", lol
Thanks for sharing that information with us. I have never had that at the federal level, but years ago Taxsylvania wanted one of my clients to obtain a statement from his employer that the amount withheld on the W-2 filed with the return was correct. Even though they already had the information, since Employers in Pennsylvania file W-2s with the state, as well as the quarterly returns, and of course they have the money. You should consider contacting your federal congressman, if more people do this than maybe this nonsense will stop. There's no reason for this, like you said they already have the information.
Back in 2018 or 2019 California did it to like 12-15 of my clients, huge PITA.
It also happens when either the employer or the payroll company fails to turn over the money to the governments.
3 of my clients have Fed withholding on their SSA-1099 who received this letter. I would like to think that SSA is sending the withholding to the IRS, hence, there should never be a 'matching' problem.
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