Wednesday, February 27, 2013

IRS Letter CP2000 - What Is It? How Do You Deal With It?



IRS mail can be scary.  I receive IRS mail relative to the Enrolled Agent designation (EA) and every time I feel a pit in my stomach when I receive one, even though I know it’s probably nothing more than an EA notice. Now, think of our clients knowing they owe money, the simply tend to delay opening the mail. Or, bury it somewhere in their desk, briefcase, or in the backyard. Gut wrenching.

We received a CP2000 notice on behalf of our client recently.  The IRS Notice CP2000 is a proposed change to your tax return.  Proposed, meaning it is not final.  However, the IRS notice looks like a collection notice. Very intimidating.

The CP2000 notice can be very confusing.  A few things to think about:

- The amount due is PROPOSED!!! DO NOT PAY IT until you fully understand the accuracy of the notice

- The amount due can be agreed to, partially agreed to, or 100% challenged

- The IRS collects MILLIONS OF DOLLARS every year from taxpayers who may not owe the entirety of the    proposed change

In other words, if you receive a CP2000 notice from the IRS take note of the date.  You will have 30 days to agree, partially agree, or challenge the notice you received. If you have questions on the notice do not hesitate to contact the IRS to ask questions.  Have a full copy of the notice, a full copy of the tax return for the year the IRS is proposing the changes, and have any and all documentation relative to preparing the return in hand. Seek out advice from Highland Tax Group, Inc.! We can be reached at 720-398-6088 or at www.highlandtaxresolution.com.

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