@edgarblythe,
It's always been my personal policy to never fool with the IRS, no matter how stupid their threats and mistakes. I remember one year where they counted my IRS withdrawals twice, and told us we owed more income tax. I had to make copies of all the withdrawals for that year with explanations why they were wrong and we were right. They still wrote back and said we owed the taxes. I had to repeat about five times why we didn't owe any more taxes; they counted one withdrawal twice.
That took several months to settle, but I knew I just couldn't just ignore them.
I don't think they read what we send them, or they don't understand the language. It's very frustrating, but we can't ignore them.
Our taxes are very simple now, because it's on the short form. That's not to say they will not come back and tell us we owe more taxes. That's always a possibility with the IRS.