Do I have a case of identity theft

[Naveen Mohan from New York]

One of my client got the notice of IRS Levy for form 941 for the quarter ending 12312012. They are saying this is the first time they heard of this liability.

the odd things about this assessment is that while corporation name and tax id number is correct but the corporation stopped doing business in 2009 and it was dissolved on March 13, 2010, yet IRS is looking for 941 balance due for quarter ending 12312012. The other odd thing is that the notice of Levy is showing Taxpayer address in the state of Oregon while my client formed this corporation in New York State and conducted business in New York State only. so obviously something is wrong somewhere.

How should I handle it.

Thanks for your help..

Naveen Mohan

[Guest Taxed]

Does look questionable. I would advise them to call the special # at IRS 800-908-4490x245 and request them to verify if it indeed is a legit IRS notice. If it is then you have to find out why? You could try the priority line with a POA.

[jklcpa]

I would also suggest calling. I'm wondering if it could be something as simple as another company having a typo in the EIN on their 941, where this unrelated company could have filed using your client's EIN. That may also explain the difference in the address.

BTW, speaking of the address, how did your client receive the notice of intent to levy if the address used is OR and you say they were only ever in NY? Was this notice sent to one of the officers of the now-dissolved corp?

Please update us when you do find out what caused this.

[Lee B]

Just the other day, I was reading an article about the filing of fraudulent W-2s & 941s with inactive EINs to

prepare the way for claiming bogus 1040 refunds. The article said that everyone should follow the procedures

for closing any inactive Federal EINs.

I didn't even know there was a procedure and I've been processing payrolls for 21 years.

I am going to have review my files to see if I have any EINs from any of my current clients which should be

closed.

[Margaret CPA in OH]

Would you please post or provide details about that article and/or procedures? Just recently I have deceased client with an EIN for employee purposes. It seems I need to follow procedures to inactivate.

Thanks!

[Gail in Virginia]

Even a link to where we could find details would be much appreciated. I don't need it today but I know in the course of events I will need this information.

[Guest Taxed]

1. How to Close an EIN for Sole Proprietorship

The IRS provides specific instructions for closing an account related to an EIN (Employer Identification Number). Reasons for closing the account vary and can be for any reason you decide to stop operating the sole proprietorship. When you make a request to close an account associated with the EIN, the IRS places the number in inactive status. If after closing the business account you wish to use the EIN again in the future, the IRS reactivates the account when you use it again. The IRS uses this method to ensure the EIN is never assigned to another entity.

Step 1

Verify that no business tax returns or tax liabilities associated with your EIN are outstanding. If you have taxes due or need to file a tax return, you must resolve the issue before you close your business account.

Step 2

Write the IRS a letter and state the reason you wish to close the account associated with your EIN. For example, if you no longer need the EIN to report employment-related taxes, you may state that as your reason. If you acquire the EIN and do not ever begin operating the sole proprietorship, you may state that as your reason.

Step 3

Attach a copy of the EIN assignment letter you received from the IRS if you have the letter available. If you do not have a copy of the letter, you may send your request without it.

Step 4

Mail your letter to the IRS at:

Internal Revenue Service

Cincinnati, OH 45999

[Margaret CPA in OH]

Thanks, Taxed! I needed that. Will do follow up for other business forms in time.

[Gail in Virginia]

But that sounds like they only place it on inactive status. If someone starts using it, whether or not authorized, they simply re-activiate it. I don't see how that would prevent the fraudulent use of your former EIN.

[Guest Taxed]

But I think if you write to IRS that the holder of the EIN is now deceased and the account should be closed, it would be difficult if not impossible to reactivate that particular #.

[Guest Taxed]

Frequently Used IRS Contact Numbers
Credit Card Payments 1.888.872.9829
Official Payments
1.888.972.9829

Pay 1040 Pay actual/estimated individual income tax
EFTPS Customer Service 1.800.555.4477
Business
1.800.316.6541
Individual Apply for a new EIN
Employer Identification Numbers 1.800.829.4933 Apply for a new EIN
Exempt Organization Business Assistance 1.877.829.5500 For assistance with Exempt Organization Business Returns
IRS Business Assistance 1.800.829.4933 For assistance with completing Business Returns
IRS E-File Help Desk 1.866.255.0654 For E-Filing assistance
Refund Status 1.800.829.1954 To check the status of a Taxpayer's refund
Identity Theft 1.800.908.4490 To report identity theft (automated and live assistance)
Tax Fraud 1.800.829.0433 To report tax fraud
Social Security Administration 1.800.772.1213 For assistance with SSN's, ITIN's, etc.
Taxpayer Advocate 1.800.777.4778 For assistance with resolving problems with IRS
Tax Assistance 1.800.829.1040 For assistance with individual tax returns
Practitioner Priority Service 1.800.860.4259 Help for tax practitioners
PTIN Information Line 1.877.613.7846 Answer all PTIN related questions

[kcjenkins]

But I think if you write to IRS that the holder of the EIN is now deceased and the account should be closed, it would be difficult if not impossible to reactivate that particular #.

And that is just for individual's EIN. For all EIN's going inactive, be sure you file the 'Final' 1096 with the X in box 7, but for a corp, you should also file Form 966. That has the same effect as a death of the holder of the individual's EIN.