Why Did I Get a RAIVS Request for Tax Information?

A Request for Automated Information Verification Service (RAIVS) is a communication you might receive regarding your tax information. These requests are a routine part of various processes where external entities need to confirm financial data. The purpose of a RAIVS request is to ensure accuracy and prevent fraud by comparing information you’ve provided with official records.

Understanding a RAIVS Request

A RAIVS request is an official communication from the Internal Revenue Service (IRS), often delivered as a formal letter. RAIVS stands for Return and Income Verification Services, a department within the IRS responsible for processing requests for tax information. These requests are primarily for information verification rather than initiating a tax audit. The IRS uses these requests to confirm financial details for various purposes.

These communications typically ask for specific tax-related information, most commonly in the form of tax return transcripts or wage and income transcripts. A tax transcript provides a summary of your tax return information, including details like adjusted gross income, rather than a full copy of your tax return. Common IRS forms associated with these requests include Form 4506, Request for Copy of Tax Return, and Form 4506-T, Request for Transcript of Tax Return.

Form 4506 is used to obtain an exact copy of a previously filed tax return, which may be needed for legal or specific financial applications, and usually involves a fee. In contrast, Form 4506-T, which is free, allows individuals to request various types of tax transcripts, such as tax return transcripts, tax account transcripts, or wage and income transcripts. These forms authorize the IRS to release your tax information to a third party or directly to you.

Common Reasons for a RAIVS Request

RAIVS requests are typically generated when an external party requires official verification of your reported income or tax filing status directly from the IRS. This helps ensure the accuracy of financial information provided in applications. Common scenarios involve significant financial transactions or applications for benefits.

One frequent reason for a RAIVS request is during the application process for a mortgage. Lenders often require verified income information to assess your ability to repay a loan and to mitigate the risk of fraudulent applications. They use tax transcripts obtained through forms like 4506-T to confirm the income you’ve stated on your loan application. This verification is a standard part of the underwriting process for home loans.

Another common scenario involves applications for student financial aid, such as the Free Application for Federal Student Aid (FAFSA). Educational institutions and the Department of Education often require tax transcripts to verify the income information provided by students and their families. This ensures that financial aid is awarded accurately based on demonstrated financial need.

Government benefit programs or other types of loan applications may also trigger a RAIVS request. Any situation where an entity needs to confirm your financial history directly from an authoritative source like the IRS can lead to this type of request.

Responding to Your RAIVS Request

Upon receiving a RAIVS request, your first step should be to verify its legitimacy. Authentic IRS letters typically feature official IRS letterhead, include specific form numbers, and provide valid contact information. Be cautious of any communication demanding immediate payment, requesting payment via gift cards, or containing grammatical errors or unusual formatting. You can often verify the authenticity by checking your IRS online account or contacting the IRS directly using phone numbers found on the official IRS website, IRS.gov, not from the letter itself.

Once you confirm the request is legitimate, you need to prepare your response, which often involves completing Form 4506-T. This form is used to request a tax transcript and allows you to designate a third party, such as a lender, to receive the information directly. You must accurately fill in your personal details, including your name and Social Security Number, exactly as they appeared on the tax return being requested. If you filed a joint return, either spouse can sign the form, but only one signature is required.

Carefully identify the specific tax year or period and the type of transcript requested on the form, such as a return transcript, account transcript, or wage and income transcript. Ensure all applicable lines on Form 4506-T are completed before signing, as incomplete forms may be rejected. The form must be received by the IRS within 120 days of the signature date to be processed.

For submission, mail or fax the completed Form 4506-T to the IRS. The correct mailing or fax address depends on the state where you lived when the tax return was filed. The IRS provides specific addresses for individual transcripts (Form 1040 series, W-2) and for all other transcript types, so it is important to use the correct address to avoid delays.

What Happens After Submission

After you submit the completed Form 4506-T, the IRS will process your request. The tax transcript is typically sent directly to the third party specified on line 5 of the form, not back to you. This direct delivery mechanism helps maintain the integrity of the information for the requesting entity.

Processing times for Form 4506-T can vary, but most requests are processed within 10 business days. However, some requests might take longer, potentially up to three weeks if sent by mail, or even longer depending on IRS workloads or if the original return was mailed rather than e-filed. If there are any discrepancies or issues with the submitted form, the IRS may reject the request, which could lead to delays for your application with the requesting entity.

If the information provided on the transcript does not align with the details you submitted to the third party, they may follow up with you for clarification. For instance, a mortgage lender might inquire about income discrepancies. Providing the requested tax information promptly and accurately helps ensure the smooth progression of your application, whether it is for a loan, financial aid, or other purposes requiring verified tax data.