Please do not ignore an IRS notice. Many notices contain response deadlines, and penalties or interest may continue to accrue. In many cases, the issue can be resolved by reviewing the notice, verifying the tax return filed, and responding properly to the IRS. Please call us for assitance at 818-523-2957
A CP2000 notice is a proposed IRS adjustment typically issued when income reported to the IRS by employers, banks, brokers, or other third parties does not match the income reported on a tax return.
A CP2000 notice does not automatically mean the IRS is correct or that additional tax is actually owed. Many CP2000 notices are generated automatically by IRS matching systems and may not include all relevant information, such as cost basis, business expenses, rollovers, corrected tax forms, or other supporting documentation.
In many cases, taxpayers come to us after receiving large proposed balances that are later reduced or resolved after the records and reporting are properly reviewed. CP2000 notices should be carefully reviewed before agreeing with the proposed adjustment or making payment.
Before agreeing to the proposed changes or making payment, it is important to review the notice carefully, preferably with your tax accountant, and verify that the IRS calculations are correct. In many cases, taxpayers can reduce or eliminate the proposed adjustment by providing additional documentation.
Yes. Filing a tax return does not prevent the IRS from later reviewing or auditing the return. Audits may be triggered by mismatched information, unusually high deductions, missing income reporting, business losses, cryptocurrency transactions, foreign income or other factors identified by IRS systems.
If you receive an IRS audit notice, it is important to respond promptly and provide the requested information. Professional representation can help protect your rights, ensure accurate responses, and reduce the stress of dealing with the IRS.
In many cases, the IRS has approximately 3 years from the date a return is filed to audit the return. However, the time period may be longer in certain situations, including substantial underreporting of income or unfiled returns.
In many situations, yes you can. Taxpayers who cannot pay their balance in full may qualify for an IRS installment agreement or other payment arrangements depending on their financial situation and compliance status.
Penalty abatement is a request to reduce or remove certain IRS penalties based on reasonable cause or other qualifying relief programs. Note that interest generally continues to accrue on unpaid taxes even if penalties are removed.
The IRS may grant penalty relief for reasons such as:
- First-time penalty abatement for taxpayers with a history of compliance
- Serious illness, injury, or death in the family
- Natural disasters or other circumstances beyond the taxpayer’s control
- Reliance on incorrect written advice from the IRS
- Other situations that establish reasonable cause.
We are happy to help you navigate this.
In some cases, yes.
The IRS may remove certain penalties if the taxpayer qualifies for relief such as reasonable cause, first-time penalty abatement, disaster relief, or other programs. Approval depends on the specific facts and circumstances.
Yes. If tax liabilities remain unresolved for a long period of time, the IRS may issue a wage garnishment. However, taxpayers generally receive multiple notices before enforcement action occurs.
Yes. The IRS may levy bank accounts if tax debts remain unpaid and unresolved. Usually, several notices are sent before levy action is taken. Addressing the issue early may help avoid enforced collection actions.
You can obtain IRS transcripts online through IRS.gov, by mail, or through authorized tax professionals with proper authorization:
- Online: Use the IRS “Get Transcript Online” service at IRS.gov to access and download transcripts immediately.
- By Mail: Request transcripts through the IRS “Get Transcript by Mail” service and receive them at your address of record.
- By Phone: Call the IRS automated transcript request line and have transcripts mailed to you.
- Through a Tax Professional: By signing IRS Form 2848 (Power of Attorney) or Form 8821 (Tax Information Authorization), you can authorize a tax professional to obtain transcripts on your behalf.
Transcripts often provide wage and income information, filing history, payment records, and IRS account activity.
A tax return is the actual return filed with the IRS.
An IRS transcript is a summary of information contained in IRS records, such as income documents, account activity, payments, and filing history.
Some prior-year returns may still be electronically filed by tax professionals, while older returns may need to be paper filed.
If a return contains errors, it may need to be amended or corrected depending on the issue involved.
In some situations, the IRS may automatically correct minor errors, while other issues may require a formal amended return or written response. Contact us if you need help amending an incorrectly filed tax return
This is very common. Even if another preparer originally filed the return, the notice should still be reviewed carefully to determine whether the IRS adjustment is correct and what response options may be available.
More details here: Can A Small Tax Return Error Trigger An IRS Notice?
Please take any IRS notice seriously and respond promptly. As the taxpayer, you remain legally responsible for the accuracy of the information reported on your tax return, regardless of who prepared it.
Before responding, carefully review the notice and compare it to the tax return that was filed. In many cases, a tax professional can determine whether the IRS adjustment is correct and help prepare an appropriate response. If your previous preparer is unavailable, unresponsive, or you would like a second opinion, we can review the return, explain the notice, obtain IRS transcripts if needed, and represent you before the IRS to help resolve the issue.
The cost depends on the complexity of the notice, the amount of research required, and whether communication with the IRS is necessary. Simple notice reviews are generally less expensive than audits, CP2000 responses, or complex representation matters.
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