Receiving a letter from the IRS in the mail can be a heart-stopping experience. Especially in the scenarios where the letter includes allegations that an individual has failed to fulfill their income tax obligations, an IRS letter can be a warning sign of major problems on the horizon.
A CP2000 series notice is a letter that serves to inform a taxpayer of an income tax return discrepancy. Specifically, the letter serves as a formal notice that the taxpayer has failed to properly report all of their income.
How should taxpayers respond to a CP2000 notice?
Guidance is necessary during a tax controversy
The IRS uses self-reported data provided by taxpayers along with paperwork submitted by employers and financial institutions to validate the true tax liability of specific individuals. In some cases, record-keeping errors by financial institutions or employers could result in the IRS receiving inaccurate information.
Those circumstances may require support from a professional who can help counter the claims of unreported income by making thorough disclosures and providing accurate information regarding the taxpayer’s recent income. In the scenarios where a taxpayer may acknowledge that an oversight or miscalculation on their part resulted in an underpayment of taxes, they may need assistance as they correct their tax return, negotiate with the IRS and try to arrange for an appropriate solution.
Assistance from a legal professional can make a profound difference for those who have recently received a CO2000 notice and who may face allegations of underreporting their income and, therefore, underpaying their federal income taxes.