You’ve filed your return and received a CP2000 notice from the IRS in the mail. What should you do? These letters let you know that agency computers found a discrepancy between income and deductions you reported on your tax return and data on third-party information returns such as Forms @-2, 1099 and 1098. Check your records. If you agree with the proposed changes, return the form with your payment. Ask for an installment agreement if you can’t pay the full amount. If you don’t agree, send the form back to IRS with a written explanation and attached copies of any documentation that you have to support your position. Respond in a timely manner, generally within 30 days of the date on the form. Call IRS to request more time if you need it. Just don’t ignore the CP2000.
The Kiplinger Tax Letter
Volume 94 No. 13