How to respond to an IRS CP2000 notice
A CP2000 is not a bill: it proposes changes because income reported by others doesn't match your return. How to agree, disagree in part, and what to send.
Check my letter freeWhat a CP2000 is
The IRS compares your return with the forms that employers, banks and brokers send it, such as W-2 and 1099 forms. When they don't match, it sends a CP2000 that proposes changes to your tax. It is a proposal, not a bill, and the change can go up, down, or to zero.
Answer by the date on the notice
Use the response form included with the notice. You can agree with all the changes, or agree with some and explain why you disagree with others. Sign the form and send it with copies of your documents, by the date printed on the notice.
Common reasons the amount is too high
Stock, fund or crypto sales: you owe tax on the gain, the sale price minus what you paid, not on the full sale price. Payment app forms (1099-K) can include personal payments that are not income. A retirement distribution rolled over within 60 days is generally not taxable. Business income on a 1099-NEC can be reduced by your business expenses.
If you don't answer
If the IRS gets no answer, it can send a statutory notice of deficiency (CP3219A) and then assess the tax. Answering, even late, is better than not answering.
More guides
- Is this IRS letter real? How to check
- IRS first-time penalty abatement: how to ask
- IRS payment plan: what to do if you can't pay in full
- IRS changed your return? You have 60 days to disagree
- All IRS notices