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Those confusing IRS notices may soon make sense to taxpayers like you

The IRS is reviewing and redesigning around 170 million tax notices it sends to individuals each year to make them shorter and simpler.
Internal Revenue Service tax forms are seen.
Posted at 10:03 PM, Jan 24, 2024

You might finally understand the complicated letters you receive from the Internal Revenue Service every tax season.

The federal agency announced Tuesday, just six days before the 2024 tax season begins, that it's overhauling the way it designs common tax documents to make them simpler and shorter for the average reader. 

The effort, named the Simple Notice Initiative, targets the more than 170 million letters the IRS sends to individual taxpayers ahead of filing season each year, which can include information about how much they owe, their eligible deductions or if they have made a filing error. 

With the redesign, the tax collector says these often long and difficult-to-understand notices will be made to better communicate the tax issue at hand and what the next steps would be for the taxpayer to confidently resolve it.

"Redesigned notices will be shorter, clearer and easier to understand," Treasury Secretary Janet Yellen said during a press call Tuesday, per The Associated Press. "Taxpayers will see the difference when they open the mail and when they log into their online accounts."

IRS Commissioner Dany Werfel said the Simple Notice Initiative will also help reduce headaches not only for taxpayers but for IRS staff as well, as they'll soon receive fewer calls from taxpayers needing help deciphering the legal jargon typically filling the notices.

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"We need to put more of these letters into plain language — something an average person can understand," Werfel said, per the AP. "The clearer our notices are — for example, when a balance is due — the more rapidly and effectively those balance dues will be understood by the taxpayer and paid."

The Simple Notice Initiative is paid for with funding from the 2022Inflation Reduction Act, which provides the IRS with roughly $78 billion over the next decade. These resources have also allowed the agency to increase customer callbacks, recover debts from corporations and millionaires who haven't paid taxes and to build its Paperless Processing Initiative.

Announced in August 2023, the goal of the initiative is to convert all paper forms to digital forms by the 2025 filing season.

The Simple Notice Initiative builds on these efforts by making the notices first available online, then making them easier to understand.

But the confusion won't go away all at once, as the IRS has only reviewed and redesigned 31 notices — sent to about 20 million in 2022 — in time for the 2024 tax season starting Jan. 29.

By 2025, the federal tax collector says it will overhaul up to 200 notices that make up around 90% of the total sent to individual taxpayers, and by 2026, it says it will expand the redesign to also include notices sent to businesses.