What Letter 5263C is
Sent by the IRS return-integrity unit (RICS) when it suspects an EIN was created to file fraudulent returns or income documents. It asks questions that establish whether a real business exists behind the number. IRS assistors are forbidden to help answer them (IRM 25.23.9.8.2). A legitimate business can receive one when a thief used its name or address on an SS-4 (IRM 25.23.11.1.6).
The deadline
As stated in the letter; the entity may be locked (TC 020) until resolved.
What to do
Answer from your own records: formation documents, the CP 575, the responsible party's identity, proof of operations. If you never applied for the EIN, say so and file Form 14039-B with Section A box 1. RICS does not send a determination letter; the outcome is learned by calling.
Entity fabrication, and how a real business gets caught in it
Some refund and employment-tax fraud starts with an EIN that was obtained for the purpose. An SS-4 is filed online with a plausible business name and a responsible party whose SSN was stolen, the EIN is used to file returns claiming withholding credits or to issue W-2s and 1099s that support fraudulent individual returns, and the "business" never existed. The Return Integrity and Compliance Services function screens new EINs and the returns filed under them for that pattern, and Letter 5263C is its request for proof that a business is real: when and where it was formed, who owns and runs it, what it does, where it operates and who its customers are.
Real businesses receive it in two ways. A newly formed company whose first filings happen to fit the pattern can be asked to verify itself, which is inconvenient but routine. Or a thief used an existing business's name or address on their SS-4, so the IRS has a fraudulent EIN tied to a real company and sends the letter to the real company's address. In the second case the business did not apply for the EIN on the letter at all.
Answering it
If the EIN is yours, answer every question from your own records: articles of organization or incorporation, the CP 575, the responsible party's identity and role, a lease or utility bill for the business address, bank statements, invoices or contracts showing operations. IRS phone assistors are not permitted to help compose the answers, so do not expect guidance from the number on the letter beyond confirming receipt. If you never applied for the EIN, say that in a signed statement, attach the letter, and file Form 14039-B (the business identity theft affidavit) marking that an EIN was obtained in your business's name without authorization; the Form 14039-B kit has the statement and cover letter. RICS does not send a decision letter when it closes the case, so call after the response period to confirm the outcome and whether the entity lock has been lifted. The business identity theft guide covers what else to check, including information returns that may have been filed under your name.
Questions about Letter 5263C
Who receives Letter 5263C?
Business / individual. Sent by the IRS return-integrity unit (RICS) when it suspects an EIN was created to file fraudulent returns or income documents.
What is the deadline on Letter 5263C?
As stated in the letter; the entity may be locked (TC 020) until resolved.
What should I do when Letter 5263C arrives?
Answer from your own records: formation documents, the CP 575, the responsible party's identity, proof of operations. If you never applied for the EIN, say so and file Form 14039-B with Section A box 1. RICS does not send a determination letter; the outcome is learned by calling.
Is Letter 5263C about my own income tax?
No. This decoder covers information reporting and withholding: the notices a payer, filer or payee sees because of Forms 1099, W-2, 945 and the TINs on them. Individual income-tax notices follow a different track.
Have a different notice? The IRS notice decoder lists all 77 in the order they tend to arrive.