Cp2000

[BHoffman]

I knew you were a softee.! grin

I love children. They taste like chicken.




Hahaha! Actually, I don't think little kids are that much different from puppies. Didn't think the parents would approve if I gave the boy a blankie and and cookie and put him in the kennel, although he probably wouldn't have minded.

[joanmcq]

The responses can be awfully hard to figure out. the securities should be showing in the numbered section with the sale price in the 'as reported to IRS' column and the basis in the 'as reported on return' column which nets to the gain or loss in the third column. sometimes they don't show anything in the 'as reported on the return column'. but then again sometime, they don't put anything in the second column.

did the client pay anything with the response? if not, $600 due sounds like what you figured out.

[BHoffman]

Hi Joan - thanks for your time.

I did figure it out that the IRS shows reported total as the gain/loss and that looks OK. But the second CP does not show that the taxpayer accounted for the other missing items. It's like the thing was only partially processed for the stock transactions.

There is a 1099R that was missing from the original. My first response included that, along with the $150 in Fed w/h. The second CP2000 shows that was still not reported and mentions nothing about the Fed w/h.

The second CP says the first CP response didn't include dividend and interest income, and it did unless I'm still missing something from this guy. I see the account numbers. It all looks like it was reported in the 1st response, and that IRS is not reflecting that.

This causes the CTC and the Student loan interest deduction to be understated by IRS.

I'll work some more on this over the weekend. Thanks for the tip about how to read what they meant regarding the "Amount included on your return" and the gains/losses. I will remember that

[joanmcq]

This response should be either agreeing or disagreeing with the changes you proposed in response to their proposed changes. it is going to include all of the missing items you agreed to in the calculation of the tax, ie, the missing interest, 1099-R, withholding. If these were issues you were not disputing, they are still there, and still affect the calculation of the tax. Same with the loan interest and CTC; the notice will include these items if they are affected by the changes.

If you want, PM me and you can fax or email me a redacted copy. The reason I think the thing is correct is that you said you figured out that $600 of tax was due, and this notice says $600 is due. If they adding another $600, the notice would say $1200.

I'm thinking of teaching a class called 'deciphering the CP2000 and other incomprehesable correspondence from taxing entities'.

[BHoffman]

I think someone should!

Joan, I'll take you up on your kind offer and get with you after I can make sure to show you clearly what I'm talking about.

Thanks so much!

[Lion]

Joan's Course

I want to enroll in Joan's course! Every time I think I'm beginning to know how to read IRS letters, they change their format.

[erchess]

I believe

from the client saying "hey buddy, I just know I gave you that tax document" so I am NOT responsible for any interest and penalties. Its basically your word aganist your client's.

it was suggested that one have the client sign a statement that these are the only tax documents they provided. If that doesn't work then there is the fact that they are required by law to examine the return and take the same level of responsibility for any errors that they would if they had done it themselves.