Moving?  Be Sure To Tell The IRS

(Published July 2010)

Reprinted from PAYROLL LEGAL ALERT, a widely read payroll management newsletter that keeps payroll executives up-to-date on the latest IRS regulations, DOL guidance, and government rulings that affect your payroll administration responsibilities. Click here to get more information, or sign up for a risk-free subscription. 

Moving a business is tough enough. Making sure employees get paid in the process only complicates matters. So it's understandable that informing the IRS of a new address may fall to the bottom of your to-do list. But it's a must-do activity. Reason: Deficiency notices, statements, and other documents are sufficient if they're mailed to a business's last known address, even if you never actually receive them. Help for the moving-distracted: a new revenue procedure that instructs taxpayers on how to inform the IRS that they've moved. The revenue procedure became effective June 1, 2010. [Rev. Proc. 2010-16, IRB 2010-19.]

You've got mail. The IRS taps into the Post Office's database to update its files. Even so, it's possible to fall between the change-of-address cracks.

Example. On June 15, 2010, Mega changed its address with the Post Office, which included the change in its weekly database update. On June 29, the IRS received the Post Office's data and updated Mega's address. However, eight days before, on June 21, the IRS mailed a deficiency notice to the address it had in its records (i.e., the old address). Result: The deficiency notice was properly mailed to Mega's last known address.

As the example shows, it's to your advantage to directly notify the IRS of your new address. To do so, you must provide a clear and concise notice of a change of address. To provide a clear and concise notice, take one of the following actions:

• file payroll/corporate returns with the new address;
  
  
• file Form 8822, Change of Address;
  
  
• return correspondence from the IRS that requires a response with the new address;
  
  
• write to the IRS specifying that your letter relates to a change of address. Include: the business's full name, Employer Identification Number (EIN), and old address. Caution: A letterhead reflecting the new address isn't enough;
  
  
• e-mail the IRS through one of the secure applications on its website. Caution: Run-of-the-mill e-mails to the IRS don't count for this purpose; or
  
  
• inform the IRS in person or over the phone, but the person with whom you speak must have access to the Service Master File. You must also provide the company's name, old address, and EIN.

Related Topic(s): Payroll Management