Take these steps to quickly and effectively deal with a CP2000 notice to minimize tax penalties and ensure you are paying the right amount of taxes. If the taxpayer files the case in US Tax Court, the matter will be first sent to IRS Appeals. This is an excellent opportunity to review the case in an impartial setting. As what is a cp2000 notice an example, the IRS increased the interest rate on underpayments for the fourth quarter of 2022 to 6%, for most taxpayers. Joint liability is a significant responsibility for both spouses. You should always read and review all correspondence you receive from the IRS so that you are able to respond in a timely manner.
You can choose one of the payment options listed on our Payments page. If making a payment, be sure to use the enclosed payment voucher to ensure proper application of your payment. If your request for an installment agreement is approved, you may be charged a user fee. The Internal Revenue Service (IRS) sends out various types of notices to taxpayers. This notice isn’t a bill—it’s merely a proposal by the IRS to adjust your income, deductions, credits, or payments.
How to Handle IRS CP2000 Notices (Underreporter Inquiry)
If successful, innocent spouse relief is a powerful tool to save taxpayers from a CP2000 notice against a spouse (or ex-spouse). Part of the tax debt relief progress is the negotiating with the IRS to remove penalties. Penalty abatement applies to the IRS CP2000, as well as other tax matters.
You can request a payment plan, file an Offer In Compromise, request Currently Not Collectible status, and if it’s from your spouse, you may be eligible for injured spouse relief. CP2000 notices are output by a computer system that detects something is off with your filed tax return. Most of the time there’s a 1099 or W2 you or your tax preparer forgot to include in your tax return. However, unlike full audits, the IRS has already made a decision. It isn’t requesting that you send additional information about the return in question. In conclusion, the IRS CP2000 Notice is essentially a document that highlights discrepancies between your reported income and/or credits and what third-party sources have reported to the IRS.
Can a CP2000 notice result in penalties?
There are plenty of scammers that may send you a fraudulent IRS CP2000 notice. Fake notices can look very convincing, but there are a few ways you can spot a fraudulent notice. Quite often, fake notices will request payments to “I.R.S.” rather than the United States Treasury. Fake notices might also include threatening language that promises harsh legal action against you unless you make your payment within a short span of time.
