Common IRS Notice Types Explained
Received a letter from the IRS? Don't panic. Here's what the most common notices mean and what you should do.
Important: Never ignore an IRS notice. Every notice has a response deadline. If you're unsure how to respond, contact a tax professional immediately.
CP2000 — Underreported Income
What it means: The IRS received information (from a W-2, 1099, etc.) that doesn't match what you reported on your return.
What to do: Review the proposed changes carefully. If correct, sign and return. If incorrect, gather documentation proving your original filing was accurate and respond by the deadline.
CP14 — Balance Due
What it means: You owe money on your tax return. This is typically the first notice you receive after filing.
What to do: Pay the balance in full if possible. If you can't, set up an installment agreement (Form 9465) or call the IRS to discuss options before penalties accumulate.
CP501 / CP503 / CP504 — Collection Notices
What it means: These are follow-up reminders that your balance remains unpaid. CP504 is the final notice before levy action.
What to do: Respond immediately. If you receive a CP504, the IRS can seize your state tax refund and begin levying other assets. Contact us right away to set up a payment plan or negotiate.
Letter 5071C / 5747C — Identity Verification
What it means: The IRS needs to verify your identity before processing your return. This is often triggered by anti-fraud filters.
What to do: Verify your identity online at the IRS Identity Verification portal or call the number on the letter. This is legitimate — the IRS does send these.
CP11 / CP12 — Math Error Notices
What it means: The IRS found a calculation error on your return. CP11 means you owe more; CP12 means the IRS is sending you a larger refund.
What to do: Review the corrections. If you agree, no action needed (for CP12, your adjusted refund will arrive automatically). If you disagree, respond in writing with supporting documentation.
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