IRS matching program (continues...)

IRS matching program example

Suppose that the IRS receives several forms w2 from a tax payer' s social security number, which add up to $30,000 in wages for the year. On a tax payer' s tax return, the tax payer reports $25,000 in wages. The IRS computer system will automatically adjust the tax payer' s income by $5000 and send the tax payer a bill for the additional tax due on this alleged unreported income.

This may have been a mistake on the tax payer' s part. Or, the tax payer may have reported the correct amount of wages and that one or more of the information on tax returns the IRS received was incorrect. Incorrect tax information could result from the employer listed the wrong social security number on one of the form w2. A tax payer should always check the accuracy of any IRS attempt to increase the amount of taxes due if the IRS sends a tax bill.