The Truth and Fiction of a Substitute for Return (SFR): Why It’s a Valid Assessment

When the IRS files a Substitute for Return (SFR) on your behalf, many taxpayers wonder: “Does this even count as a real tax return?” The answer: an SFR is absolutely a valid tax assessment—but it’s not the same as filing your own return. Understanding the difference is critical.

The Truth About SFRs

• An SFR is a legal IRS assessment. It creates a balance due and gives the IRS the authority to collect.

• It is based only on third-party information like W-2s and 1099s.

• It triggers penalties and interest just like a self-filed return.

The Fiction Around SFRs

• “I don’t need to file since the IRS already did.”

• “It’s not a real return, so I can ignore it.”

• “The IRS’s numbers must be correct.”

The reality: An SFR stands until you file your own return to replace it. And because the IRS doesn’t include deductions, credits, or exemptions, the tax bill is usually inflated.

Why Filing Your Own Return Still Matters

• You may qualify for refunds or credits the IRS didn’t include.

• Filing puts you—not the IRS—in control of your return.

• Self-filed returns are necessary for certain resolution options and legal protections.

An SFR is real, and the IRS can and will collect on it. But that doesn’t mean you’re stuck with their numbers. Filing your own accurate return is the only way to correct and protect yourself. If you have an SFR on your account, don’t assume it’s final. We can help you file correctly, replace the IRS’s version, and get you back on track.