IRS: 'Limited group' getting erroneous Letters 6419 (Advance Child Tax Credit)

The IRS tamped down suggestions there may be widespread inaccuracies in Letters 6419, which report to taxpayers the total amount of advance child tax credit payments they received during 2021.


Nevertheless, the Service said in a fact sheet issued Friday (FS-2022-5) that if Letter 6419 reports a different total than expected, taxpayers should rely on the total shown in their online account with the IRS. However, advance child tax credit payment information will not be available on online accounts until Jan. 31, according to an "important message from the IRS" on the accounts.


"The IRS is reviewing the situation, but we believe this is a limited group of taxpayers involved out of a much larger set of advance child tax credit recipients," the Service said in a statement issued Thursday. "There is no indication to support speculation that this could involve hundreds of thousands of taxpayers."


In an IRS call with reporters on Monday, Ken Corbin, the Wage & Investment Division commissioner and chief taxpayer experience officer (the latter a new position within the Service created a year ago), said that a small group of taxpayers may receive incorrect Letters 6419, such as those who moved or changed bank accounts in December.

Some practitioners and commentators have recently raised the specter of systemic errors in the letters. Tax blogger Kay Bell at dontmesswithtaxes.com noted "anecdotal" reports on social media by tax professionals finding mismatches of the numbers on their own letters with those in their records.


The latest IRS statement, however, reiterated Corbin's earlier characterization of taxpayers receiving incorrect letters as a "small affected group" of taxpayers including those who moved or changed banks late in 2021.


"We are working this issue; we will provide resources to taxpayers to make sure they have access to the most up-to-date information when filing their returns," the statement continued. The Service is setting up procedures to handle questions about child tax credit payments to "help keep refunds moving."


And the IRS urged taxpayers to check other records of the payments, including their online account at irs.gov beginning Jan. 31. Taxpayers may also use the IRS's Child Tax Credit Update Portal to view their advance child tax credit payments received.

The fact sheet also emphasized relying upon the online account.


"If the person believes they received a different amount than what the letter indicates, they should check the IRS online account; this is the information the IRS has on file," the fact sheet said.


However, the "important message" on the online accounts, in noting that the accounts will provide the information starting Jan. 31, said on Friday that "until then, you can use the Letter 6419 sent by mail," and then, "Do not use the payment details in this portal."

Married taxpayers who file jointly for 2021 will need to combine information from two Letters 6419, one sent to each spouse, on Schedule 8812, Credits for Qualifying Children and Other Dependents, the IRS noted in the statement and highlighted with a "caution" heading in the fact sheet, which also noted that "each spouse can find their individual advance payment total in their online account."


The monthly advance payments began in July 2021 for most qualifying taxpayers and should in most cases total half the amount of the credit claimable for the full year. However, in frequently asked questions updated on Jan. 12, the IRS also noted one common situation in which taxpayers may have received excess advance payments, such as in a shared-custody arrangement where a taxpayer with a qualifying child on the taxpayer's 2020 return (information on which the IRS may have relied in issuing the advance payments) no longer could claim the child for 2021 as a qualifying child for the child tax credit.


In that and other situations with similar effects, the Letter 6419 may be correct, but the amount of the advance credit received may be excessive. The FAQs also discuss circumstances in which some taxpayers may have to repay an excess.


If you still need assistance with delinquent returns or have tax debt questions, please call Tony Silva at (619) 477-4357 for a free consultation.

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