Written by attorney Henry Daniel Lively

Understanding your IRS CP 2000 Notice

You received an IRS CP 2000 notice in the mail; now what? The CP 2000 notice is sent by the IRS to show proposed changes that they are making to your income tax return. The changes that the IRS proposes is based on comparing what you reported on your income tax return with what was reported to them by your employer, bank, etc. The IRS may also make other changes to your return based on errors they have found when processing the return.

A CP 2000 is not a tax bill. It just asks you whether you agree with the proposed changes and if you do to pay the tax, and if you do not to provide documentation as you why you believe the tax is not due. This is only a proposal and you do not have to agree with it. No additional tax has been assessed by the IRS with the sending of this notice.

Therefore, you will need to compare the information on the notice with your records and determine if you agree with the proposal. If you agree with the proposal you do not have to file an amended return. You just need to indicate that you agree and pay the amount indicated as due.

You much pay attention to the response date on the notice. After the time allowed for a response the IRS will presume you agree with the amount due if you do not respond. If you need more time to respond to the notice the IRS will typically give you a 30 day extension upon request. Penalties and interest will continue to accrue during the extension period if it is granted.

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