IRS to Simplify, Redesign Notices for Upcoming Tax Seasons

The IRS announced plans to make mailed notices easier for taxpayers to read and understand over the course of the next couple years to reduce preventable customer service call volumes as the agency continues to shift towards modernization using Inflation Reduction Act (PL 117-169) funds. (IR 2024-19)

“Today, we’re announcing the Simple Notice Initiative, an ambitious plan to redesign hundreds of different notices and other correspondence sent to taxpayers each year,” Treasury Secretary Janet Yellen told reporters January 23. “Until now, these letters have not been as taxpayer friendly as they could be. They’ve been criticized as too long, filled with complex legal jargon, and difficult to understand. With the Simple Notice Initiative, redesigned notices will be shorter, clearer, and easier to understand.”

“Taxpayers will see the difference when they open the mail and when they log into their online accounts,” she assured.

An accompanying IRS fact sheet said the agency sends about 170 million notices to individuals each year. IRS Commissioner Danny Werfel, piggybacking off Yellen’s comments, explained the impetus behind the initiative was feedback from taxpayers and tax professionals who agree the notices aren’t easy on the eyes.

“With our current systems and machines, the letters can be a mishmash of looks. They do not always have a consistent, familiar look you might get from a credit card company or a bank,” said Werfel. “We need to put more of these letters into plain language, something an average person can understand without needing to hire a tax or legal professional.”

Last year, IRS redesigned 31 notices in time for tax filing season starting next week. In total, 20 million of these notices were sent in calendar 2022. Also part of these early efforts was a pilot Notice 5071C, which saw the notice trimmed in length and improved with a larger font, graphical elements, clear instructions, and a QR code.

“In all, 60,000 taxpayers received this pilot letter compared to the taxpayers who received the original notice,” Werfel said. “There was a 16% reduction in taxpayers who call the IRS as their first action and a 6% increase in taxpayers who use the online option. The IRS will apply the lessons learned from this pilot to a larger notice redesign initiative.”

By the 2025 filing season, the IRS intends to apply this philosophy to 200 notices that comprise 90% of all notices sent to individuals (150 million in 2022). Those notices pertain to income, payments, credits and deductions, error correction, and balance reminders. Work on business taxpayer notices will be the next areas of focus for the 2026 filing season and moving forward.

“If we have clear letters, this can cut down on taxpayers needing to call or visit that frees up time for our customer service representatives to help other taxpayers,” said Werfel. “And fewer calls means our employees can work on other things, including dealing with some of the paper we receive. So making our letters simpler to understand is a core improvement that we need to do. Simpler notices can create a positive ripple effect throughout the IRS, the nation’s tax system as well as saving taxpayers time and stress.”