What does my IRS notice mean?
Millions of notices are mailed by the IRS each year. These are anything from default notices, request for additional documentation, to corrections on tax returns. Some are just informative. The notice will usually cover a specific issue and offers equally specific instructions on what the IRS wants from you.
Don’t Panic! First, open the envelope–don’t assume you know what it is. Not every envelope from the IRS is a bill or even bad news. Often the letter just specifies what the IRS did with your account, what the IRS has received, or what the IRS has on file. The notice may request payment, may notify you of how the IRS applied a payment you made, may notify you of a change to your account, or may request additional information.
Whatever you do, do NOT ignore the notice! The IRS does not forget, and they want to hear from you!
The notices can be confusing and intimidating. While the IRS is currently working on a project to simplify the notices they send to taxpayers, in the meantime, we have to work with what they send. So, what does your IRS notice mean?
The notices are classified by a code preceded by the letters CP. The code is in the upper right-hand corner of the letter. The most common notices are:
* CP12 – Changes to Tax Return, Overpayment
* CP14 – Balance due
* CP49 – Overpaid Tax Applied to Other Taxes You Owe
* CP90 – Final notice – Notice of intent to levy
* CP91 – Final notice before levy on Social Security benefits
* CP161 – Request for Payment or Notice of Unpaid Balance, Balance Due
* CP297 – Final notice – Notice of your right to a hearing
* CP298 – Final notice of intent to levy on Social Security
* CP501 – Balance due reminder notice
* CP504 – Final Notice – Balance Due
* CP523 – Notice of Default on Installment Agreement
* CP2000 – Notice of Proposed Adjustment for Underpayment/Overpayment
If you do not agree with the purpose of the notice, or do not understand it, the IRS must be contacted as soon as possible. Call me if you have received an IRS notice, I can assess your situation and we can decide what action to take.