What to Expect in an IRS Audit
From Tax Guide.
Tax Guide · Arab, Alabama
Got a Letter From the IRS? What to Do When You Receive an IRS Notice
Got a letter from the IRS? Do not ignore it. Learn how to read an IRS notice, what a CP2000 means, and the steps to take before the deadline.
The short answer
What should I do if I get a letter from the IRS?
Do not ignore it and do not panic: read it carefully, note the response deadline printed on it, and get help if you are unsure what it means.
Most IRS letters are routine. Many ask a question, request a missing document, or explain a change the IRS made to a return. Only some point to money owed, and even those usually leave room to respond.
The most costly mistake is silence. A notice has a response deadline, and missing it can limit your options and lead to more serious action later. Keep the envelope and the letter, and make a copy of anything you send back.
Before you respond
How do I know the IRS letter is real?
A real IRS notice arrives by mail, and the IRS generally does not begin contact by phone, text, email or social media.
Scammers copy the look of IRS letters and demand payment by gift card, wire or cash app. The IRS does not demand payment that way. A genuine notice includes a notice number in a corner, your correct name, a contact number and specific tax year information.
If something feels wrong, do not use a phone number or link from the message itself. Call our office, or look up the official IRS number yourself. Never give a Social Security number to someone who called you.
- A phone call or text that demands immediate payment is a warning sign.
- The IRS does not threaten arrest over the phone.
- A real notice names the tax year and the reason it was sent.
- When in doubt, bring the letter to us.
Reading the letter
What do the numbers and codes on an IRS notice mean?
The code in the upper corner, such as CP2000, identifies the type of notice, and the body explains why it was sent and what you are asked to do.
The notice number is worth looking up on the IRS notice page, which explains each one. Read the whole letter, including the back, for the tax year involved, the amount in question, and the response date.
A few common types show the range. The names below are general descriptions, and any notice can differ in its details.
- CP2000: the IRS says income reported by others (such as a W-2 or 1099) does not match your return. It is a proposal, not a final bill, and you may agree or disagree.
- A balance due notice: the IRS says you owe tax and explains how to pay or respond.
- A request for information: the IRS needs documents to complete its review of a return.
- A refund adjustment notice: the IRS changed your refund and explains the change.
- A collection notice: the IRS is following up on an unpaid balance. Do not wait on these; see tax levies and wage garnishment.
Next steps
How do I respond to an IRS notice?
Respond in writing, in time, and with copies of your supporting records.
If you agree with the notice, follow its instructions to pay or confirm. If you disagree, explain why in a clear letter, attach proof, and send it by the method the notice describes. Proof of mailing is helpful, so use a trackable method.
If you cannot respond in time, call the number on the notice and ask about your options rather than letting the date pass. A balance you cannot pay in full may qualify for an arrangement, as described in our guide to IRS payment plans. Penalties on a notice can sometimes be discussed; see penalty relief and abatement.
You can also have someone respond for you. A signed power of attorney lets a representative speak with the IRS for you, as explained in power of attorney for tax matters.
What not to do
What mistakes should I avoid with an IRS letter?
The biggest mistakes are ignoring the notice, missing the deadline and sending an answer without keeping a copy.
Another common error is paying a bill you do not agree with just to make it go away, or agreeing to something before you understand it. Take time to read and to check the IRS numbers against your own records.
Do not send documents or Social Security numbers through any website or by email unless the notice tells you how to do so securely. If an audit is the reason for the letter, see what to expect in an IRS audit.
Getting organized
What should I gather before I call or come in?
Bring the notice itself and any records for the tax year it names, so the review starts with facts instead of guesses.
The more you can bring, the faster we can understand what the IRS is asking. Start with the letter and envelope, then add the return for that year and the forms that report your income. If the notice mentions a payment or a refund, bring the proof.
Write down a brief timeline of anything relevant, such as a move, a new job, a divorce or a change in the business. These details often explain a mismatch. Please bring the papers to the office or call us with questions; do not email or upload Social Security numbers.
- The IRS notice and envelope, including any pages on the back.
- A copy of the return for the year named.
- W-2s, 1099s and other income forms.
- Proof of payments or refunds for that year.
- Any earlier letters about the same matter.
How we can help
Need help with an IRS notice?
Melton Tax Services can help through our tax representation service.
We can review the notice, explain the options and respond to the agency on your behalf. Do not ignore it: bring us the letter and any copies you have, and we will start from there.
We serve Arab and the surrounding area. Call 256-586-4635 or use the contact page. Please bring documents to the office rather than sending them through the website.
Answers
Questions about received an irs notice
Does an IRS notice mean I am being audited?
Not necessarily. Many notices are automatic matching or math checks, not audits. Read the letter to see what it says, and bring it to us if you are unsure.
How long do I have to respond to an IRS notice?
The response deadline is printed on the notice, and it varies by notice type. Respond before that date, and call the number on the letter if you need more time.
What is a CP2000 notice?
It is a proposed change the IRS sends when income reported by others does not match your return. You can agree, or disagree with supporting proof. It is not a final bill until the process is complete.
Can I ignore a notice if I think it is wrong?
No. Even a notice you believe is mistaken needs a response by the deadline. Explain your disagreement in writing with documents.
What if I lost the notice?
You can ask the IRS for a copy, or we can help you find out what was sent. Details on the notice, such as the tax year, guide the next step.
Will the IRS call me before writing?
The IRS generally first contacts taxpayers by mail. Be cautious about unexpected calls, texts and emails that claim to be from the IRS.
Should I call the number on the notice myself?
You can, but many people prefer to speak with a representative first. Have the letter and the return in front of you if you call.
Can someone else open my IRS mail for me?
The notice is addressed to you, and a person who is not authorized cannot generally discuss it with the IRS. A signed power of attorney allows a representative to act for you.
Read next
Related reading
Power of Attorney for Tax Matters: Form 2848
From Tax Guide.
IRS Penalty Relief: First-Time Abatement Explained
From Tax Guide.
Tax Representation
A service Melton Tax Services provides.
Melton Tax Services
Questions about your taxes or your business?
Our team in Arab is just a phone call away, and we are glad to talk it through with you.