Know your obligations and protections under the law. San Diego Tax Attorney William D. Hartsock offers this advice.
Why did I receive a CP14 Notice from the IRS?
If you have received a CP14 Notice from the IRS, it usually means that you owe the IRS money for unpaid taxes and you may also owe the IRS money for interest and penalties that have accrued on those unpaid taxes.
Whenever you receive a CP14 Notice, you should:
- Read the CP14 Notice carefully, especially the part explaining how much you owe and how to pay it.
- If you agree with the IRS’s explanation about how much you owe, pay the full amount owed by the date set forth in the notice.
- If you agree with the IRS’s explanation about how much you owe but are unable to pay the full amount by the date specified in the notice, pay as much as you can and contact the IRS to discuss the possibility of setting up a payment plan for the unpaid balance. Be aware that interest and penalties will be assessed if you do not pay the full amount by the date on the payment coupon included with the CP14 Notice you received.
- If you do NOT agree with the IRS’s explanation about the amount you owe, contact a tax law professional such as the ones at www.TaxLawFirm.net to discuss the best strategy for resolving the discrepancy with the IRS. Be sure to contact a tax law professional right away, because the IRS must generally be advised in writing about a discrepancy within 60 days of the date on the CP14 Notice you received. If the discrepancy is not addressed properly, your tax return could be referred for audit.
Answers to Frequently Asked Legal Tax Questions:
Why is the IRS reviewing my return?
While most returns are accepted by the IRS as filed, a certain number of returns are selected for examination. The IRS examines some income tax returns to verify that the income, expenses, and credits reported on the return are accurate. The IRS selects tax returns for examination using various methods including random sampling, computerized screening, and comparing information the IRS has received that relates to the return, such as W-2 and 1099 forms. Just because your tax return was selected for examination does necessarily mean that the IRS believes you made an error or were dishonest on your return.
If I am not able to pay the full amount of unpaid tax I owe by the due date, will the amount of my tax obligation increase?
Yes, interest will accrue on an unpaid tax balance beginning on the day after the tax is due. Also, you will be assessed a late payment penalty if the full amount of tax you owe is not paid on the day it is due. The CP14 Notice will usually contain a detailed explanation of any interest and penalties that have accrued to date and how they were calculated. Additional information in IRS Notice 746, Information About Your Notice, Penalty and Interest, may be helpful.
The following images are an example of what an IRS Tax Notice CP14 actually looks like.
This sample notice is for example purposes only. The case facts and figures on your notice will vary according to the specifics of your case.