What to Do If You Receive a CP 2000 Notice from the IRS

A CP 2000 notice is issued by the IRS when they believe a federal income tax return shows either underreported income, excessive credits, or incorrect deductions. It’s one of the most common IRS notices and can cause stress for both taxpayers and payers.

The letter typically says that the IRS’s records don’t match what was reported on the tax return. For example, a payer may have filed Form 1099-MISC, but the income wasn’t included—or was reported incorrectly—on the taxpayer’s return.

Why You Received a CP 2000 Notice

• The IRS’s Underreporting Office automatically reviews tax forms like 1099s and compares them with filed returns.

• If something doesn’t match, the IRS generates a CP 2000 notice.

• Notices are mailed in batches, sometimes only a few at first to test for responses.

If there is no response, the IRS continues sending notices until the issue is addressed.

What to Do If You Get a CP 2000 Notice

1. Respond Immediately

   • Don’t ignore it. If you’re the recipient, contact your tax preparer.

   • If you’re the payer, contact the person or company that prepared and transmitted your 1099 forms.

   • Gather all supporting documents and review the notice carefully.

2. Call the IRS Underreporting Office

   • Phone: 866-455-7438 (Extension 3)

   • Explain the situation and request that the IRS suppress additional notices while you work on a correction.

3. File a Corrected Return Electronically

   • Get the correct data, review it, and file the correction quickly.

4. Send a Letter of Explanation

   • If you’re the payer, send an explanation letter to affected recipients.

   • This letter should be on company letterhead and include:

     • Payer name, contact name, and TIN

     • Recipient name

     • Type of form (e.g., Form 1099-MISC)

     • Corrected amount

     • Brief explanation of the issue

5. Ensure Recipients Respond

   • Each recipient must reply to the IRS by the deadline on their CP 2000 notice.

   • The recipient checks off whether they agree with some or all of the changes, signs the form, and includes your explanation letter.

Key Takeaways

✔ A CP 2000 notice means the IRS found a mismatch between tax forms and filed returns.
✔ Do not ignore it—contact the IRS or your tax preparer immediately.
✔ Correct the error electronically and provide a written explanation.
✔ Both payers and recipients must take action before the IRS deadline.

📞 Need help responding to a CP 2000 notice? Contact us at 480-706-6474 or email support@1099fire.com for assistance.