Letter 12C: the IRS needs more information

Your return is stuck in processing until the IRS gets specific items from you. The letter says exactly what is missing. A common example is the Premium Tax Credit, where the IRS needs Form 8962 and Form 1095-A.

This is not an audit. It is a gap in the return that stops the IRS from finishing it. Until the gap is filled, any refund on that return waits, so the faster you reply, the sooner the return can move.

Twenty days. The irs.gov Letter 12C page says: "Send the information we requested within 20 days." Respond even if you disagree, with a clear explanation of what you disagree with.

The IRS will adjust your return without your input. Per the Taxpayer Advocate Service, that may increase the tax you owe or reduce your refund. A short reply now is far easier than undoing an adjustment later.

1. Read the letter and list each item requested.
2. Find the missing forms, schedules or proof.
3. Do not file Form 1040-X, an amended return, for this letter. IRS.gov says not to.
4. Send the reply the way the letter instructs, and keep a copy of everything you send, with the date you sent it.
5. If something on the list doesn't exist, say so in writing rather than leaving it out without a word.

It asks for whatever stopped your return from processing. According to the IRS, that can be a missing form or schedule, or proof of income, withholding, credits or Social Security numbers. The letter itself names the items, so there is no guessing.

A frequent case involves health coverage bought through the Marketplace. If you received advance payments of the Premium Tax Credit, the IRS needs Form 8962 to reconcile them, built from the Form 1095-A the Marketplace sent you. Another is withholding the IRS can't match, where a W-2 or 1099 copy settles it. Send exactly what is listed, with a copy of the letter on top.

Blaga works out exactly what the letter is asking for and gathers it with you. She prepares the reply, including Form 8962 and Form 1095-A when it is about the Premium Tax Credit, and makes sure you don't file an amended return by mistake. A signed Form 2848 lets her follow up with the IRS directly.

Her office is on FM 1960 W in Houston; the secure portal works for anyone farther out. If the original return was the issue, see individual tax preparation.

Once the IRS has what it needs, it finishes processing. Per irs.gov, any refund due comes about 6 to 8 weeks after it receives your response. If it adjusts the return instead, you may get a notice such as a CP22A. A related letter, the CP05, covers returns under review.