04/28/2026
Some of you may have received IRS Notice C35PE regarding your tax account, and we want to clarify what it means.
You originally had a balance due on your return, which you paid by the normal deadline. At that time, the IRS calculated an underpayment (estimated tax) penalty based on the standard due dates.
However, because Tennessee was later granted federally declared disaster relief, the IRS extended certain payment deadlines. This extension reduces or eliminates the underpayment penalty for affected taxpayers.
As a result, the IRS has recalculated your account using the extended deadlines and is now issuing a refund for the portion of the penalty that is no longer applicable.
In some cases, this letter has been sent out IN ERROR.
You can go to IRS.gov and add your bank account details in your id.me account IF there is a refund due. If you paid your taxes by direct debit, this was a one time authorization and not for direct deposit.
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