Nobody enjoys the process of preparing, filing and paying their taxes. But once the taxes are filed, you can breathe a sigh of relief, knowing that you have another year before you have to repeat the process.
Therefore, it can be unnerving to receive a CP14 notice from the IRS. Understanding what the IRS is requesting with this notice can help you determine your course of action.
What is a CP14 notice?
The IRS sends a CP14 notice to inform taxpayers that they owe money. There are a you might receive this notice, such as the following:
- You didn’t pay the full amount due with your tax return.
- The IRS reviewed your tax return and discovered a discrepancy, resulting in a balance due.
- You didn’t file on time and now you have a late fee and penalties.
- You received previous notices and haven’t taken any action.
- There were delays in processing your return and the notice was sent out before the payment was received.
It could also be an error. The notice should explain why the IRS shows that you owe money.
Do not ignore a CP14 if you receive one, even if you believe the IRS sent it in error. Failing to respond could result in more severe consequences, such as interest, penalties and liens. Read the notice carefully as it will contain important information, including:
- Your total balance due (including penalties and interest)
- Reason for the balance
- Payment deadline
- Instructions for either paying or disputing the notice
Compare the IRS’s numbers against your records. You will want to ensure whether the notice is accurate before taking further action. If the notice is correct, go ahead and pay your balance. If you believe the CP14 is incorrect, you can dispute it by taking the following steps:
- Gather any documentation that supports your claim, such as canceled checks or other financial records.
- Contact the IRS and discuss your concerns, providing your supporting evidence. You may need to send a written explanation via their website or certified mail.
If you can’t resolve the issue and it continues to escalate, you will want to speak with a legal professional about your CP14 notice. They can explain your rights and discuss further action.