Cp 2000--need Help Now

[Super Mom]

T/P got a cp 2000 for income not on the taxes for 2009. Actually, when I correctly made the changes, some of it reflected deductions as well and the IRS actually owes the T/P money! It's just a very small amount though, should I do an ammendment I'm assuming that must be done to get the small amount. Or did I hear right that ammendments are red flags, I know I can answer this without an ammendment and the small amount doesn't really matter to us, but the IRS maybe can only understand exact? What to do? I'm working on this now, so I need opinions now. Thanks!

[Jesse]

I have done amendments but I send them with and to the address on the CP2000. I don't worry about "red flags" as there should be nothing to worry about if I'm doing it correctly and have an honest taxpayer.

If it's a business or some situation that although everything is on the up and up but you or the taxpayer just doesn't want to chance the time of a possible audit then just respond with an explanation and documentation on why you don't owe the tax.

[Super Mom]

Thanks Jesse, I went on and done an ammendment, nothing to hide.

[JohnH]

Usually all you need to do is respond to the CP-2000 with copies of any schedules affected by the changes (both their proposed changes and those you have discovered). I like to include a simple worksheet detailing how the changes interact, but a 1040X would probably serve that purpose just as well.

I think the key is not to simply submit a 1040X through the normal channels, but rather to send whatever you produce to the reply address for the CP-2000.

[Gretel]

As far as I know the only difference filing an amended tax return to filing an original tax return is that a human being is looking at it. If it is a legit there should be no problem. This is different than a red flag per se.

[DaveO]

I usually include a 1040X when responding to a CP2000. I just mark it "COPY" and reference it in my cover letter.

[taxmandan]

As far as I know the only difference filing an amended tax return to filing an original tax return is that a human being is looking at it. If it is a legit there should be no problem. This is different than a red flag per se.

There is one big difference between an original return and an amended: there is no statutory requirement for theIRS to accept an amended return. They can and have refused to accept them. Just had a client get a rejection letter for the amended return we filed. Took a long discussion with the PHL to get the situation resolved and the new numbers were eventually accepted.