IRS Letter 5071C/4883C: Identity Verification Request

IRS 5071C Letter and IRS 4883C Letter are official IRS notices sent by IRS authorities to verify your identity when there is a potential identity theft flagged on your tax return during processing. The IRS fraud detection unit generally does this to confirm that the return is genuine and that someone has not used the SSN (Social Security number) or the ITIN (Individual Tax Identification Number) to file the return in order to claim your refund.

NRIs living in the USA or outside the USA face additional challenges, as the IRS verification tool assumes you are only in the USA and, during verification, that you are physically present with a US phone number and ID.

In this blog, we will understand the difference between the two letters, how to respond to them, and more.

What Are IRS Letters 5071C and 4883C?

Let's decode both letters, starting with Letter 5071C. It is a letter sent by the Internal Revenue Service when they receive your income tax return with your name or SSN, but they need to verify your identity before finishing processing the return. The IRS conducts such checks when it suspects identity theft under their IRS identity theft protection

The IRS Form 4883C is a formal notice sent by the Internal Revenue Service. The IRS sends such a notice to verify your identity in a case where your income tax return is flagged for potential identity theft or fraud.

Both of these IRS letters are sent when the IRS receives a tax return filed under your ITIN or SSN, and before it finishes processing the return, it needs to confirm your identity. It is done as part of the IRS's broader effort to protect your identity from potential fraud.

Please do not worry when you receive letter 5071c or receive letter 4883c; it does not mean that you have done anything wrong. It is just the IRS's fraud-detection system flagging something on the return. Now, this could just be an unusual pattern that requires a human confirmation step before the tax authorities move your refund forward, or it could be suspicious activity.

Letter 5071C vs. 4883C - What Is The Difference

The sole difference between the two identity verification forms is how you can verify your return. The following table clearly demonstrates the difference between 4883c vs 5071c.

In case you receive the Letter 5071C, try verifying the density one first because it is the fastest way to do so. If you are served with Letter 4883C, you have no option but to wait for the phone confirmation.

A Detail is Especially Relevant for NRIs: if you are living outside the United States, the IRS will roll it as a related identity verification letter for you, called Form 5447C. This letter is specifically for identity verification for individuals with US tax obligations living outside the U.S. This letter offers both the online and the on-call version of verification.

Why Do NRIs Receive an Identity Verification Notice?

NRIs receive IRS identity verification letters for the same reason as any other U.S. citizen taxpayer would. However, there are other reasons that often come up more often in NRIs' cases.

The income tax return was filed using an SSN or an ITIN, which looks quite unusual to IRS authorities and IRS fraud detection systems. This often happens due to a mismatch in the filing patterns, address changes, or a return that does not match your prior year filing history.

The identity verification letters are sent when there is a genuine case of identity theft, in which someone else has used your SSN or ITIN to file a fraudulent return. People do so in the hope of claiming refunds before you file your return yourself.

First-time filing the US income tax return from a new address. Receiving letters for this reason is quite common for NRIs who have just moved back to India or have updated their mailing address with the IRS.

The IRS authorities have detected inconsistencies between years. Such as switching between the Form 1040 and Form 1040-NR due to a change in residence status.

How Should NRIs Respond To 5071C Letter and Letter 4883C?

The following are the steps to respond to 4883C letter and the 5071C letter:

1: Verify The Identity Online

If you are served with Letter 5071C or 5447C (if you are living outside the USA), to verify your identity, go to idverify.irs.gov and follow the prompts. Online verification is generally the easiest and most convenient way to complete the application process within minutes, provided everything is ready.

Verify the Identity by Phone

If you are served with letter 4883C or if the online verification website is not working, then you must call the number printed on your letter. However, be prepared to wait during peak filing sessions, and ensure you are calling from a location where you can easily spend time on hold.

Documents You May Need

Before you begin responding to the letter, gather the following documents for ease.

• A copy of your prior-year tax return.
• Along with all the supporting documents, a copy of the current year.
• W-2s, 1099s, or Form 1042-S documents relevant to the return.
• A valid government-issued photo ID, such as your own passport.
• Any letter or the notice number that is referenced on the identity verification letter itself.

However, for NRIs, the online verification tool often requires the taxpayer to prove identity using a US-based credit history, a US mobile number, or a US-issued identification, none of which an NRI living outside the US may have available. If the online verification tool is unable to verify you, use the phone option as the fallback, even if it takes longer.

What Is The Deadline To Respond To 5071C or 4883C?

Regarding the IRS 5071c letter deadline and IRS 4883C letter deadline to respond to the notice, you are generally expected to respond within 30 days of receiving the letter. However, the IRS does not always frame this as a hard legal cutoff, as it does for other income tax notices.

However, for NRIs, since international mail takes time to reach India and phone calls face geographical challenges, it is better to check the online option first, even if your letter primarily emphasizes the phone number.

What Happens After Identity Verification

After your identity has been successfully verified:

The IRS generally resumes the processing of your identity verification. The processing of the refund may take time, somewhere around nine weeks, depending on the IRS processing times and your individual situation.

To know the status of your IRS income tax refund, you can track it by using the "Where's My Refund" tool. However, as covered in the earlier guidance, this tool is known for its limitations for NRIs filing Form 1040-NR.

Further, for a refund that has been meaningfully delayed due to the verification process, the IRS will pay the applicable interest.

What If An NRI Did Not File The Tax Return?

If you have not filed the tax return and have received letters 5071C and 4883C, and you genuinely did not file the return as described, it is important to act quickly.

Contact the IRS immediately using either the online tool or the phone number. Do not ignore the return just because it isn't yours.

Tell the IRS that you did not file the return. This will flag the return as fraudulent and help the authorities secure your account.

You are not required to file Form 14039. The form is used for the Identity Theft Affidavit now unless the IRS specifically requires you to do this. This is done to report the non-filing through the verification channel as the first step.

You can also try additional security measures by requesting the IP PIN; this is a six-digit code the IRS issues that makes it harder for anyone else to file under your SSN or the ITIN in the future. Further, review your IRS account periodically for anything unusual. Let us understand the entire concept with an example:

Now that he uses the fast identity verification method rather than waiting for a callback, he has avoided weeks of delay. His case is a useful reminder that even if the letter is deemed the one called, it is always worth checking which elements of verification are valid and the dates.

The Bottom Line

IRS 5071C letter for NRIs, IRS 4883C letter for NRIs, and the specific 5447C letter all exist for the same reason: the IRS wants to confirm that you are the one filing the return, not someone else.

In case you are not sure which verification path applies to your specific letter, or the online tool is not recognizing you due to a lack of US-based credit history, consulting a tax professional is highly advisable, as they can help you sort the next steps out and ensure that everything went by seamlessly.

Savetaxs is such a professional, helping clients and NRIs with their identity verification and further helping you claim the applicable refunds.

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