Internal Revenue Service and State tax agencies complete Computer Generated Audtis. Read how to address these letters and processes and procedures you need to take when confronted with addressing Computer audits. These audits are done using documentation received by tax agencies on income supposedly received by taxpayers via W-2s Wage & Salary, Form 1099s Commissions or other income from various sources. These can be paypal receipts, interest income, rental property and for services provided as well. Do not put your head in the sand and ignore correspondence form tax agencies. You need to address these on your own or with tax debt or audit professionals. Written by: Martha De la chaussee Tax Resolution Expert

1. Notice of Underreported Income
The IRS compares the information reported byemployers,banks,businesses,and other payers on income
documents like the Forms W-2,1098, 1099,etc., with the income,credits,and deductions you report on your income
tax return. The Automated Under reporter (AUR) function sends outa Notice CP-2000 if you did not report income
reported to the IRS by a payer or if it appears thatpayments,credits and/or deductions are overstated.The CP-2000
is not a bill.It is a proposal to adjustyour income,payments,credits,and/or deductions.This mayresultin additional
tax owed or a refund of taxes paid.
The first page of the notice provides a summaryofproposed changes to your tax, the steps you should take to
respond,and a phone number to call for assistance.In addition,the notice:
 Shows the amounts you reported on your original or amended return
 Shows the amounts reported to the IRS by the payer
 Shows the IRS proposed changes to the tax, credits,and/or payments
 Shows the payer’s name,ID number,the type of documentissued (W-2,1098,1099), and the tax
identification number ofthe person to whom the documentwas issued
 Based on payer documentation,proposes either an increase or decrease to your tax liability, and
 Includes a response form,paymentvoucher,and an envelope.
Review this information carefullyto verify its accuracy and so you know exactly how you should respond.On the
response form,you should indicate whether you agree with all the changes,agree with some ofthe changes,or do
not agree with any of the changes the IRS is proposing.The response form also allows you to authorize someone
other than yourself to contact the IRS concerning the notice,and the notice provides paymentoptions.
Responding to the notice:
 If you agree with the proposed adjustments,complete and sign the response form, and return it in the
enclosed envelope.The proposed adjustments will generallyshow interestcalculated 30 days from the
date on the notice; certain penalties mayalso applybut may not be shown.You may pay the amount
you owe within 30 days from the date of notice, and making thatpayment will stop additional interest
from accruing.If you make a partial payment, or you send the signed consentwithoutpayment,the IRS
will bill you for the amountdue plus additional penalties and/or interestcharges.If making a payment,
please use the enclosed paymentvoucher to ensure proper application ofyour payment. If you are
unable to pay, see Topic 202 for more information abouttax paymentoptions,or you may requesta
paymentarrangementto pay the amountyou owe by enclosing Form 9465 (PDF),Installment
AgreementRequest,with your response.You will be contacted later with paymentinformation.If your
requestfor an installmentagreementis approved,you may be charged a fee.
 If you do not agree with any changes or with some ofthe changes, do not sign the notice. Instead,
explain in a separate signed statementwhy you do not agree,attach the statementand supporting
documentation for consideration to the response form,and submitthe response form and attachmentto
the IRS. Include your phone number with area code and the besttime of day to call.
Do not file an amended return ( Form 1040X (PDF)) for the tax year shown in the upper right hand corner of page 1.
The IRS will make corrections for you after we receive your response.If the same or other errors occurred in any
other tax years, you may wish to file an amended return for those years in order to prevent or reduce the accrual of
penalties.See Topic 308 for more information aboutamended returns.
You mustrespond within 30 days of the date of the notice or 60 days if you live outside the United States. Send your
response,a copy of the notice you received, and any other necessarydocuments with the enclosed envelope.If you
have lostthe envelope or it was not enclosed,please send your response to the address listed on the firstpage of
the response form. If you are making a payment,use the provided payment voucher to ensure correctapplication to
your account.If there is a proposed balance due and we do not hear from you within the 30 or 60-day period,AUR
will issue a statutory notice of deficiency and additional interestand penalties will be charged as appropriate.