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CP127 notice: what it means and what to do
Got an IRS CP127 notice? Here is what it means, your deadline, what to check before you answer, and how to reply. Check your own letter free: it stays on your phone.
Check my CP127 notice freeWhat the IRS says this notice is about
We made changes to your Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons, because we found a miscalculation. Our changes don’t affect the amount of tax you owed.
What you need to do
- Read the notice carefully.
- Compare the figures on the notice with your tax return.
- Contact us within 10 days of the date of the notice if you disagree with the changes we made. Please have your account information available when you call.
- Correct the copy of your tax return that you kept for your records if you agree with our changes. Keep this notice for your records.
Your deadline
The IRS page for this notice mentions 10 days. Always use the date printed on your own notice.
What to check before you answer
You have 60 days to disagree
If you disagree with the change and ask in writing within 60 days of the notice date, the law requires the IRS to reverse it. If the IRS still disagrees, it must then use the regular process, which keeps your appeal rights.
Is this letter really from the IRS?
The IRS writes first by mail. A real letter shows a notice or letter number, your name and part of your tax ID number. The IRS does not ask for payment by gift card, crypto or wire transfer. If in doubt, sign in to your IRS online account, where many notices are listed.
You may want to
Download a copy of Instructions PDF for Form 1042 PDF .
Common questions
What should I do if I have been charged a penalty and I don’t agree?
If we charged a penalty and you would like us to consider removing it, you must send us a written request. When you write, identify the penalty you would like us to reconsider and explain the reasons why we should remove it.
Helpful information
- Publication 15, Circular E, Employer's Tax Guide PDF
- Publication 515, Withholding of Tax on Non Resident Aliens and Foreign Entities PDF
- Notice 746, Information About Your Notice, Penalty and Interest PDF
Tips for next time you file
- Consider filing your taxes electronically. Filing online can help you avoid mistakes. Learn more about filing options .
- Review your return for accuracy before mailing it to us.