Sometimes when a taxpayer does not file a tax return, the IRS will estimate the amount owed and prepare a Substitute for Return (SFR). More specifically, IRS computers prepare the SFRs based on information the IRS receives from third parties, such as Forms W-2 and 1099. The IRS would then issue a letter to the taxpayer regarding the proposed deficiency with penalties added for late filing and late payment. Taxpayers could respond with information about deductions, credits, or errors and discuss the proposed deficiency with an IRS employee.

Due to a lack of funds, the IRS has suspended the SFR program at this time.

More information about the suspension of the ASFR Program is forthcoming from TIGTA. We will share updates as they are released.