How to Write a Clear IRS Explanation Letter
Explain the issue in plain language, show which records support your answer, and tell the IRS what you want reviewed.
A clear IRS explanation letter answers four questions: Which notice are you answering? What is your position? What do your records show? What should the IRS review? Use the notice as your outline. Start with the issue the IRS raised, then point to the evidence that answers it.
Read the instructions before drafting. A letter can explain your position. If the IRS requires a signed response form, include it. If you received a statutory notice of deficiency, sending an explanation to the IRS does not file a Tax Court petition or extend the petition deadline.
State your position
Say what you agree with, dispute, or are supplying.
Show the facts
Use dates, amounts, and attachment labels the reviewer can check.
Make a request
Name the item you want the IRS to review or correct.
What to include in an IRS explanation letter
- Identify the notice. Put the notice number, notice date, and tax year in the subject line. Add the reference information the notice asks you to provide.
- State why you are replying. Say whether you are providing requested records, disputing a proposed change, or explaining why you agree with only part of it.
- Explain one issue at a time. Name the item, say what your records show, and explain the difference. For several issues, use the order shown on the notice.
- Point to the exact evidence. Write “Attachment A, page 2, shows the payment date and confirmation number.” That is easier to verify than “See attached paperwork.”
- Close with a specific request. Ask the IRS to review the payment, reconcile the income amount, or reconsider the specific change. Sign as instructed.
If you are waiting for a record, say which document is missing and when you requested it. Contact the office listed on the notice before the due date to ask how to proceed. Keep the original deadline on your calendar unless an applicable extension is confirmed.
Show where the amount appears on the return
Too vague: “I already reported this income. Please fix my account.”
Clearer: “I disagree with adding the $2,400 from [payer] as additional income. I included that amount in the $12,600 of gross receipts reported on Schedule C, line 1. Attachment A shows the $12,600 total and identifies the $2,400 from [payer]. Attachment B shows the reported total on my filed Schedule C. Please review whether the proposed adjustment counts the $2,400 twice.”
The example gives the reviewer a way to follow the numbers from the notice to the worksheet to the return. Use it only if your own records support the same explanation.
Re: [Notice number] • Tax year [year] • Notice dated [date]
[Your name and mailing address]
[Date of your reply]
[Reference information requested on the notice]
I am responding to [notice number] regarding [specific issue]. I [am providing the requested information / disagree with the proposed change / agree with part of the proposed change].
Item 1: [Issue and amount, if applicable]
The notice states [brief summary]. My records show [specific fact, date, or amount]. Attachment A, page [number], shows [what the record establishes].
Item 2: [Use only if needed]
I [agree or disagree] with this item because [brief explanation]. See Attachment B, page [number].
Please review [specific item] in light of the enclosed records. [Add any next step the notice asks you to address.]
[Signature as required]
[Printed name and contact information as requested]
Enclosures: [Required response form or notice pages], Attachment A: [document], Attachment B: [document].
Before you send your letter
- Confirm the notice number, tax year, and reply deadline. Check separately for appeal or petition instructions.
- Make sure each disputed item has a short explanation and a clear reference to its supporting records.
- Include required forms, signatures, and notice pages. Send legible copies of supporting records.
- Use a submission method authorized for your notice. Keep a copy of the full reply and any upload, fax, or mailing confirmation.
Frequently asked questions
How long should my IRS explanation letter be?
One page is a useful target for one straightforward issue. Use more space if needed for multiple items. Put longer calculations and records in labeled attachments.
Can I use this letter instead of amending my return?
Follow the notice. For example, if you agree with a CP2000 and have no other income, credits, or expenses to report, the IRS says you do not need to amend. If you disagree with an item, follow the notice’s instructions for explaining your position and providing evidence.
Does proof of delivery mean the IRS accepted my explanation?
No. Keep the confirmation as proof of submission, then read any follow-up notice for the IRS decision and any new deadline.
Make the issue easy to verify
State your position, show where the facts come from, and ask for a specific review.