A client received a letter from the NJ Division of Taxation yesterday, which he, correctly so, immediately faxed to me.
The letter read:
“Dear Taxpayer(s):
Our records indicate that you claimed a property tax deduction of $10,000.00 on your 2004 Gross Income Tax Return. However, information we received from your Local Property Tax Assessor’s office indicates that you only paid $X,XXX.XX in property taxes on your principal residence for the tax year 2004.
There, the Division has adjusted your 2004 property tax deduction to $X,XXX.XX which resulted in a balance due on your account in the amount of $XX.XX.
The above amount due should be forwarded to this office within thirty (30) days to avoid the imposition of additional penalty and interest charges.
If our records are not correct and you paid more than the amount indicated above in property taxes for the tax year 2004 please forward a photocopy of your 2004 final tax bill, assessment notice or 1098 Mortgage Statement showing the amount of your property taxes.
Please remember that you may only claim the deduction for property taxes paid on your principal residence. If you lived at more than one location for the year, along with above documentation, please indicate the time period during 2004 that you occupied each address as your principal residence.
If you have any additional questions about your account, information may be obtained by contacting our Customer Service Center at (609) 292-6400.”
This is the first time I have ever seen such a letter. Actually, kudos to the NJDOT for attempting to match NJ-1040s to Property Tax Assessor information. The letter was for tax year 2004, as 2004 will only still be an “open” year (available for audit or review) until April 15, 2008. I expect that once the 2004 letters have been completed NJDOT will send out similar ones for 2005, if they have not already done so.
In my case the taxpayers actually “lived at more than one location for the year”, and I will need to send them documentation of the taxes paid at each location for the period of residence. This should not be a problem.
Have any of you also received such letters from your clients?
TAFN
The letter read:
“Dear Taxpayer(s):
Our records indicate that you claimed a property tax deduction of $10,000.00 on your 2004 Gross Income Tax Return. However, information we received from your Local Property Tax Assessor’s office indicates that you only paid $X,XXX.XX in property taxes on your principal residence for the tax year 2004.
There, the Division has adjusted your 2004 property tax deduction to $X,XXX.XX which resulted in a balance due on your account in the amount of $XX.XX.
The above amount due should be forwarded to this office within thirty (30) days to avoid the imposition of additional penalty and interest charges.
If our records are not correct and you paid more than the amount indicated above in property taxes for the tax year 2004 please forward a photocopy of your 2004 final tax bill, assessment notice or 1098 Mortgage Statement showing the amount of your property taxes.
Please remember that you may only claim the deduction for property taxes paid on your principal residence. If you lived at more than one location for the year, along with above documentation, please indicate the time period during 2004 that you occupied each address as your principal residence.
If you have any additional questions about your account, information may be obtained by contacting our Customer Service Center at (609) 292-6400.”
This is the first time I have ever seen such a letter. Actually, kudos to the NJDOT for attempting to match NJ-1040s to Property Tax Assessor information. The letter was for tax year 2004, as 2004 will only still be an “open” year (available for audit or review) until April 15, 2008. I expect that once the 2004 letters have been completed NJDOT will send out similar ones for 2005, if they have not already done so.
In my case the taxpayers actually “lived at more than one location for the year”, and I will need to send them documentation of the taxes paid at each location for the period of residence. This should not be a problem.
Have any of you also received such letters from your clients?
TAFN
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