IRS Notices, Forms, and Letters: Understanding What They Mean
The IRS sends different types of notices, forms, and letters to taxpayers for various reasons, such as requesting additional information, notifying about tax liabilities, or confirming changes to tax filings. Understanding these communications is crucial to responding correctly and avoiding penalties.
Common IRS Notices and What They Mean
CP Notices (Computer Paragraph Notices)
CP14 – You have unpaid taxes and need to make a payment.
CP2000 – The IRS found a discrepancy between your return and third-party data (such as W-2s or 1099s).
CP501/CP503 – A reminder that you have unpaid taxes.
CP504 – The final notice before the IRS may levy your assets.
IRS Letters and Their Purpose
Letter 1058 – A final notice of intent to levy your wages or assets.
Letter 226J – Penalty notice for employers under the Affordable Care Act (ACA).
Letter 6419 – Information about advance Child Tax Credit payments.
Letter 725-B – An audit appointment request from the IRS.
What to Do If You Receive an IRS Notice
Read It Carefully – Identify why the IRS is contacting you.
Verify the Information – Compare the details with your tax records.
Take Action Promptly – If required, respond within the deadline to avoid further action.
Contact a Tax Professional – If you don’t understand the notice or need help responding, consult a tax expert.
Keep Records – Maintain copies of all IRS correspondence and your responses.
How to Avoid Future IRS Notices
File your taxes accurately and on time.
Keep thorough records of income and deductions.
Respond quickly to IRS requests to prevent escalations.