I’ve written about James Smith before. A few years ago, Mr. Smith was the victim of IRS “help” when they changed the Employer Identification Number (EIN) without his knowledge; that saga ended in 2022. Unfortunately, Mr. Smith is now suffering through an Identity Protection Unit saga with no end in sight.
In 2021 Mr. Smith’s 2020 personal tax returns were timely filed with the IRS and Arkansas. Mr. Smith’s 2020 federal return showed a refund of approximately $30,000; his Arkansas return showed a refund of about $10,000. He promptly received his Arkansas refund. However, about four months after filing Mr. Smith received an IRS 5071C letter requesting he verify his identity.
The process when you receive such a letter is that you must create an account on IRS.gov. That’s now done through a third-party company, ID.me. That company requires you to verify your identity–so you end up having to verify your identity twice. The IRS now includes this important piece of information in their FAQ:
Yes, you must come back to this page and sign in to answer questions about your tax return.
But Mr. Smith did his verification in November 2021, not May 2022, and he didn’t realize that he had to verify his identity twice. In late 2022 he called me to check on his refund. I obtained an IRS Power of Attorney form covering 2020-2022 and called the Practitioner Priority Service in January 2023. They told me he had never verified his identity online, and he would now need to call the Identity Protection Unit.
Calling the IP Unit is an adventure, and Mr. Smith is a busy businessman. After several attempts he successfully verified his identity on March 23, 2023. The IP Unit told him the return and refund should be processed within nine weeks. Well, since I’m writing this you probably realize that didn’t happen. We’ll cover the next steps in Part 2 of this saga next week.
Tags: Identity.Protection.Unit