00:00Go. Hi, Jamie Flores with the Law Offices of Nick Namath. Today I'm going to go over a CP2000.
00:05So the letter notice is on the top left part of this notice. And what is a CP2000? So these
00:12go out every year. They usually go out two years after the tax return was filed. So right now we're
00:17seeing CP2000s that are coming out right now for about 2022. Sometimes we're seeing 2021,
00:23but generally right now it's for 2022. All this notice is, it's a serious notice. Do not just
00:29throw it in the trash. Okay. Because if you don't respond to this notice, the IRS is going to
00:34continue on with an assessment. So this one is not a bill and it tells you, Hey, this is not a bill.
00:39Just there is something that's incorrect on the tax return that you filed. That's different than
00:45what was reported underneath your social security number or EIN number to the IRS. And so it's going
00:51to go over the proposal of what those differences are. What generally are they? So a lot of times
00:57it is going to be a home sale that you failed to report. It's going to be, um, a retirement
01:01distribution or an IRA, a withdrawal. Um, it could be, uh, stock exchanges. Um, it could
01:09be just income that you failed to report on your tax return or a mismatch of a number of
01:17income on your tax return. Um, there are a lot of different reasons you would get a CP2000.
01:22So don't panic. It just probably needs a response. This notice, uh, and it's usually about seven
01:28or eight pages. You have the option to agree or disagree with these changes, sign the response
01:34form and mail it back in with documentation as to what you're disagreeing with. You would
01:39then attach either an amended return in response to the CP2000 with the changes that should have
01:46been on the original return, or you would just attach whatever schedules are needed, um, in
01:51order to, uh, fix the changes. If you agree with the changes, because you just happen to
01:57leave off maybe some 1099 income that you don't have any expenses for, then just agree and move
02:03on. And then you'll get a bill usually in about 30, 45 days. Um, and then you need to take,
02:08take, uh, make arrangements to pay that bill. But this is an, uh, mismatch of information
02:14that you reported to the IRS. They want to go in and fix it. If you fail to respond, they
02:20will, um, send you a notice of determination and then you will get a bill, but you do have
02:26rights to, uh, appeal their decisions. Um, and it's also going to break down the penalties,
02:31the interest, um, and reasonable cause penalty abatement, um, for the penalties. If you under
02:38reported, uh, by a certain percentage of your income, then you're also going to get the
02:43accuracy related penalty with, which is a lot of money. So if you need help, give us a call.
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