IRS letter CP23 is a notice issued when the IRS believes there is a difference between the amount of estimated tax payments reported on your tax return and the amount you paid according to IRS records. This notice is typically sent to request that you pay the amount the IRS says that you are short.
What should I do when I receive an IRS CP23 notice?
First, read the IRS CP23 promptly and carefully. The IRS should indicate why they sent the notice and how much they believe that you owe in additional taxes, along with a deadline by which you should respond. It is important to respond to the IRS by the deadline they provided.
Second, compare the payments that the IRS claims you made with the payments shown in your tax records. Consider both payments made specifically for the tax year at issue and any payments that were applied to the tax year at issue from the prior tax year. You should then be able to determine if you agree with the IRS, or if it appears they are incorrect.
If you agree with the IRS, the IRS provides the following options for payments:
Option 1: If you can pay the full amount that is owed, you can pay the amount owed online at Payments.
Option 2: If you cannot pay the entire amount that is owed, you can go to this IRS site to determine if you qualify for an IRS payment plan using the Online Payment Agreement tool. If you are not sure if you qualify for a payment plan, contact us for a free consultation.
Retain the copy of all items related to the IRS CP23 notice – the notice itself, any other correspondence with the IRS, and evidence of any payments made. You should note any changes that were made and correct your copy of your tax return for the year at issue.
If you do not agree with the amount that the IRS claims that you owe, contact us for a free consultation to discuss your options.
For additional information on the CP23 letter, you can visit the IRS website here.
Third, respond to the IRS’ request by the deadline. Your response will vary depending on what the IRS is asking for, and whether you agree with what they provide in the notice. For a discussion of various IRS letters, see here.
Finally, keep copies of everything! We cannot stress enough how important this is. We have had clients send in voluminous amounts of data that took many hours to complete, only to have the IRS lose it. If the IRS loses your documents and you do not have a copy, you will need to recreate them – the IRS does not take responsibility for losing documents. Further, it is very important to keep copies of every IRS letter or notice, every response you make, and proof of the date of your response. If you respond electronically, keep the electronic confirmation. If you mail documents to the IRS, mail them such that they can be tracked, and keep the tracking information.
In summary, if you receive certified mail from the IRS or any mail from the IRS, do not ignore it, and respond by the deadline. The IRS won’t go away, and if you ignore the letter you could be hurting your own rights.
If you are not sure why the IRS sent you a letter, or how to respond, contact us as soon as possible to schedule a free consultation.
Receiving IRS Communications? Attorney Komor Can Help
Komor Tax Law LLC will explain the letter that the IRS sent you, how we would respond to the letter if you hire us, and what actions the IRS may be planning against you. Often, time is of the essence and a prompt reply is needed. Don’t wait – contact us today if you have received a letter from the IRS.