If it does not change the tax balance higher or lower, you can often call in and get the adjustment. Getting through to the IRS can be difficult sometimes and it may be easier to just mail a response. If the tax balance changes based on the information you are going to provide, you or your representative need to mail in response. If you don’t respond, the IRS will send you a Notice of Deficiency and charge you a penalty in addition to any additional taxes or interest you owe as outlined in CP2000.
- Common reasons for receiving a CP2000 notice include not reporting income from all sources, such as wages, interest, dividends, pensions, or self-employment income.
- The worst thing you can do when you receive a CP2000 is to ignore it, which will almost certainly result in additional penalties and interest.
- If you disagree with the proposed changes in the CP2000 and send the IRS information supporting your claim, the IRS should take between 30 to 90 days to send you its decision.
- They offer TaxFacts reports that include IRS transcripts as well as any unpaid penalties or balances owed.
- Again, if you wait, interest will accrue until the amount is paid in full.
Don’t have time to deal with the CP2000 yourself?
Determine if you agree or disagree with the proposed changes and how you should respond. On the Response form, indicate whether you agree or disagree with all, some, or none of the proposed changes. what is a cp2000 notice If you would like to authorize someone other than yourself to contact the IRS concerning the notice, include the information requested in the Authorization section of the Response form.
What if the information the IRS has on file is incorrect?
And Topic no. 308 for more information about amended returns. If you agree and would like to apply for an installment agreement plan by mail, send your signed response form and a completed Form 9465, Installment Agreement Request PDF. Our computer systems match the information you report on your tax return to information reported to IRS by third parties, such as, financial institutions, employers, and other businesses.
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It’s quite common to get one, and they don’t always result in an increased bill. If we don’t hear from you by the response date on the notice, we’ll send you a Statutory Notice of Deficiency. Our customer success team helps 100,000+ businesses find the right solutions for their inquiries. You too can resolve any issues instantly with a simple consultation.
Topic no. 652, Notice of underreported income – CP2000
Due to the complexity of the matching process, it can take months to complete. No, the notice is a proposal and informs you of a discrepancy between the information we received, and the information reported on your tax return. If the discrepancy remains unresolved, or we don’t receive a response to the notice, you may receive a subsequent notice and a bill at a later date.
Remember, amending your return after a CP2000 notice is not an admission of guilt. It’s just a way to make things right and get back on track with the IRS. View our interactive tax map to see where you are in the tax process.
Book a free call to learn how we can help you and discuss your options for navigating your CP2000 notice. If your CP2000 doesn’t come with a response form, it might come with alternative instructions for responding to the IRS. Usually, it means that you didn’t report all of your income properly. It could mean you underreported income for your self-employment taxes or freelance work you did as an independent contractor, for example.