What the letter means
The Letter 566 is an initial contact letter (ICL). IRM 4.19.13.8 tells examiners: “If requesting information only, use the appropriate initial contact letter as outlined in the program procedures, or utilize Letter 566-S, Initial Contact.” When the campus already proposes changes, it uses a letter with a Form 4549 report instead (for example, Letter 566-B). The Taxpayer Advocate Service lists the family: 566 (IN/PR), 566 (IO), 566-B, 566-B EZ, 566-D, 566-E, 566-J, 566-L, 566-M, 566-S and 566-T.
Secure messaging cases use different letters. IRM 4.19.13.33.1: those taxpayers receive “Letter 566-T, Initial Contact - Secure Messaging, and Letter 566-J, ICL - 45 Day Combo - Secure Messaging,” sent in place of the standard 566-S and 566-B.
Why the client got it
Campus examination works narrow, document-driven issues: credits, dependents, specific deductions, education credits, home mortgage interest and similar items. Each campus program has its own letter set; for earned income credit cases the initial contact is usually the CP75 series rather than a Letter 566. IRM 4.19.20.2.1 says: “The ICL for EITC cases is the CP 75 notice series. The ICL for Discretionary cases is the Letter 566-S.” The IRS does not publish its selection criteria; the letter states which items are under review, and the examination is limited to those unless the campus expands it.
Deadlines and what happens if they pass
| Letter type | Campus suspense before the next letter | Source |
|---|---|---|
| ICL without report (EITC, TS non-EITC, single-issue PTC) | 30 days (manual next letter no earlier than day 31) | IRM 4.19.13.2.4 |
| SB/SE non-EITC ICL without report | 45 days (no earlier than day 46) | IRM 4.19.13.2.4 |
| 45-day letter with report (ICL combo, e.g. 566-J) | 60 days (no earlier than day 61) | IRM 4.19.13.2.4 |
Use the response date printed on the letter. On extensions, IRM 4.19.13.11.7 says the taxpayer “will be automatically granted an additional 30 days on the first request (from the original response due date shown on Letter 566-S/Letter 566-T,” and SB/SE campuses confirm with Letter 686-B. Later requests are judgment calls, and none is granted when 180 days or less remain on the assessment statute unless the statute is extended.
If there is no response, IRM 4.19.13.13: “After the suspense period has expired, issue the 30-Day letter with proposed examination report.” The TAS page states the consequence: “If you don’t respond by the due date, the items in question will be disallowed.”
How to respond
- File a Form 2848 for the year. IRM 4.19.13.9 tells examiners to annotate the POA and update contacts so copies flow to the representative with Letter 937. If the authorization is not on the CAF, the examiner follows the authentication procedures in IRM 21.1.3.3.
- Answer only what is asked, completely. Organize the documents by the items listed on the letter and any Form 886-H document list enclosed. The TAS page advises sending copies, not originals, with the name and TIN on each page if faxed or uploaded.
- Use the reply channel on the letter (mail, fax, upload or secure messaging) and include the reply cover sheet. Keep proof of the send date.
- Ask for the automatic extension early if records are not ready. It is automatic only for the first request.
- Call if the request is unclear. Explaining a document by phone before sending it can prevent a report based on a misunderstanding.
- Consider the statute. A short statute limits extensions and may bring a request to sign Form 872.
For representatives, the bypass rules and interview rights are on when the IRS contacts your client directly. A campus exam can be transferred to an area office only in limited cases; IRM 4.19.13.16 requires at least 13 months on the statute.
What the IRS does next
The TAS page summarizes the examiner's options after review: request more information, accept the return as filed, or propose changes. In practice that means a no-change letter, a Letter 692 or similar request, or a Letter 525 30-day letter with a Form 4549 report. If the client agrees with the report, signing it closes the case. See correspondence examinations and closing an exam.
Related notices
- Letter 2205: field examination initial contact (in-person audit).
- CP2000: an underreporter proposal, not an examination.
- Letter 525 and Letter 3219: the next two steps if the issue is not resolved.
Questions practitioners ask
Is a Letter 566 an audit?
Yes. It is the start of a correspondence examination, even though no one visits. It is different from a CP2000, which is an automated matching proposal.
How long does the client have?
The response date on the letter. The campus waits 30 or 45 days (depending on the program) before issuing the next letter, and the first 30-day extension request is granted automatically.
Can the IRS look at items not on the letter?
The letter defines the issues under review. An examiner can expand the scope, but the initial letter is limited to the listed items.
Can I ask for the case to be moved to a local office?
Only in limited cases. IRM 4.19.13.16 requires at least 13 months on the statute or a Form 872, and the campus first tries to resolve the concern.
Will the representative get copies?
Yes, if a Form 2848 is on file. Examiners send copies with Letter 937 and must contact the POA in lieu of the taxpayer once a valid POA is present.