LT40

An LT40 says the IRS, while trying to collect unpaid taxes or unfiled returns, intends to contact other people or institutions — generally to get or verify your contact information. The law limits what it may disclose to them: generally no more than your name and what's necessary.

“We may contact third parties over the next year to verify how to reach you. We'll tell them only what the law allows, and once a year we'll send you a list of anyone we were required to tell you about. Meanwhile, the balance and any missing returns still need attention.”

The letter's real message is that the account is active enough for the IRS to start reaching outward. Resolving the balance or the filings is what ends that — the usual options (payment, plan, hardship, offer in compromise) all remain open.

• The notice
• Current contact information the IRS may not have — a moved address is often why this letter exists
• Records for the balance and any unfiled years
• Proof of recent payments (they can take up to 21 days to post)

• Getting the account current so third-party contact never actually happens
• Updating the address of record properly (Form 8822)
• Filing missing years from IRS transcripts
• Reviewing the annual third-party contact list if one arrives