Hey, you! Yes, you, the one who just got a letter from the IRS. Welcome to Bottomline Tax. Don’t panic, it’s not as bad as you think. You probably received a CP12 notice, which means the IRS corrected some errors on your tax return and changed your refund amount. This is actually good news, because it means you’re getting some money back or you owe less than you thought. But you might be wondering what exactly a CP12 notice is, why you got it, and what you should do about it. Well, don’t worry, we’ve got you covered. In this article, we’ll explain everything you need to know about IRS CP12 notices, including:

What they are and why you got them
How to check your refund status and dispute any changes
What are some common errors that lead to CP12 notices and how to avoid them in the future
How the IRS corrects errors and what it means for your CP12 notice
Some best practices for doing your taxes and preventing future errors

By the end of this article, you’ll be a CP12 notice expert and feel more confident about your taxes. So let’s get started!

Understanding IRS CP12 Notices

What is a CP12 notice?

A CP12 notice is a letter that the IRS sends when it detects a math or calculation error on your tax return that affects what your tax refund should be. Some examples of math errors are:

– Incorrectly claiming a standard deduction or itemized deductions
– Miscalculating your taxable income or adjusted gross income
– Claiming credits or deductions that you are not eligible for or that exceed the limit
– Entering the wrong Social Security number or filing status
– Failing to report all of your income or reporting it twice

When you get a CP12 notice it means that either you’ll be receiving a different tax refund amount or that you’ll be receiving a tax refund rather than owing the IRS money.

This IRS notice is sometimes called an IRS adjusted refund letter or overpayment letter. It’s not a bill or a penalty, but rather a notification of a correction that the IRS made on your behalf. The IRS usually sends CP12 notices within a few weeks after you file your tax return, but it can take longer depending on the volume of returns they receive and the complexity of your situation.

Why did I get this CP12 notice in the mail?

You received a CP12 notice because the IRS found a math error on your tax return that changed the amount of tax you owe or are owed. The IRS may have discovered the error during their routine processing of your return, or they may have received additional information from third parties, such as employers, banks, or other government agencies, that did not match what you reported on your return.

The CP12 notice will show you the original and corrected amounts of your tax, refund, or balance due. It will also explain the reason for the change and provide references to the tax law or form instructions that support the correction. You should review the notice carefully and compare it with the information on your tax return.

What should I do now that I’ve got this CP12 notice?

If you agree with the changes that the IRS made to your tax return:

You don’t need to do anything.
If you are still due a refund, you should receive a check in 4-6 weeks, as long as you don’t owe other taxes or debts that the IRS is required to collect.
If you now owe money, you should pay the balance by the due date shown on the notice to avoid interest and penalties.

If you don’t agree with the changes that the IRS made to your tax return:

You should contact them within 60 days from the date of the notice.
You can call them at the toll-free number listed on the top right corner of your notice, or write to them at the address shown on the notice.
You should include any documents or information that support your position and explain why you disagree with the correction.

If you contact the IRS within 60 days, they may be able to reverse the change they made to your account. However, if they believe that their correction is correct and you cannot provide additional evidence to justify a reversal, they will forward your case to examination for audit. This will give you formal appeal rights, including the right to appeal their decision in court. The audit staff will contact you within 5-6 weeks to explain the audit process and your rights.

You should keep a copy of your CP12 notice and any correspondence with the IRS for your records. You may also want to correct the copy of your tax return that you kept for yourself, but do not send it to them unless they ask for it.

For more information about CP12 notices and how to respond to them, you can visit these links:

– Understanding Your CP12 Notice | Internal Revenue Service
– Understanding Your CP12E or CP12F Notice | Internal Revenue Service

Checking the Status of Your Refund

If you received a CP12 notice from the IRS, it means that they have made some changes to your tax return and you are entitled to a refund. You don’t need to do anything to get your refund, but you may want to check on its status and see when you can expect to receive it.

To check the status of your refund, you can use the Where’s My Refund? tool on the IRS website or the IRS2Go mobile app. You will need to provide your Social Security number, filing status, and the exact amount of your refund as shown on your notice. You can start checking on your refund within 24 hours after the IRS acknowledges receipt of your e-filed return or four weeks after mailing a paper return.

How can I check on my refund status?

The IRS updates the status of refunds once a day, usually overnight, so you only need to check once a day. There are three stages of refund processing: Return Received, Refund Approved, and Refund Sent. You can track your refund through these stages using the Where’s My Refund? tool or the IRS2Go app.

If you see the message “Return Received“, it means that the IRS has received your tax return and is processing it.
If you see the message “Refund Approved“, it means that the IRS has finished processing your return and has approved your refund. The IRS will also provide a personalized refund date, which is the date that they will send your refund to your bank or mail a check to you.
If you see the message “Refund Sent“, it means that the IRS has sent your refund to your bank or mailed a check to you. You should receive your refund within a few days if you chose direct deposit or within several weeks if you chose to receive a check by mail.

How long does it usually take to get my refund?

The IRS issues most refunds in less than 21 days after receiving your tax return, but some may take longer depending on various factors. Some of the reasons that may delay your refund include:

Your tax return has errors or is incomplete.
Your tax return is affected by identity theft or fraud.
Your tax return includes a claim for the Earned Income Tax Credit or the Additional Child Tax Credit, which may require additional review.
Your tax return is selected for a random audit or review.

If your refund is delayed for any reason, the IRS will contact you by mail and explain what you need to do. You can also call the IRS at 800-829-1040 if you have any questions or concerns about your refund.

How to Dispute Changes Made by the IRS

If you receive a CP12 notice from the IRS, it means that they have made some adjustments to your tax return based on the information they have. This could result in a change in your refund amount or a balance due. However, sometimes the IRS may make a mistake or overlook some important details. If you disagree with the changes made by the IRS, you have the right to dispute them and request a correction.

To dispute the changes, you need to follow these steps:

Review the notice carefully and compare it with your original tax return. Identify the specific items that you disagree with and gather any supporting documents or evidence that can prove your case.
Write a letter to the IRS explaining why you disagree with the changes and what you want them to do. Include your name, address, Social Security number, phone number, tax year, and notice number. Attach copies of your supporting documents and any relevant forms or schedules. Do not send original documents.
Mail your letter and attachments to the address shown on the notice within 60 days of the date on the notice. Keep a copy of everything you send for your records.
Wait for a response from the IRS. They will review your dispute and send you a letter with their decision. If they agree with you, they will make the necessary corrections and send you a revised notice. If they disagree with you, they will explain why and inform you of your options to appeal or go to court.

How to Tell the IRS They’ve Made a Mistake

Sometimes, the IRS may make a mistake on your CP12 notice that is obvious or easy to fix. For example, they may have used the wrong filing status, applied the wrong tax rate, or miscalculated your credits or deductions. In these cases, you may not need to write a formal letter to dispute the changes. Instead, you can simply call the IRS and tell them what the error is and how to correct it.

To tell the IRS they’ve made a mistake, you need to follow these steps:

Call the toll-free number shown on your notice as soon as possible. Have your notice and tax return handy when you call.
Explain to the representative what the mistake is and how it affects your tax liability or refund. Provide any relevant information or numbers that can support your claim.
Ask the representative to correct the mistake and send you a confirmation letter or a new notice. If possible, get their name and ID number for future reference.
Keep a record of your call, including the date, time, name and ID of the representative, and what was discussed and agreed upon.

What Kind of Proof Do You Need to Show the IRS They’re Wrong?

If you want to dispute the changes made by the IRS on your CP12 notice, you need to provide proof that can back up your position. The kind of proof you need depends on what kind of adjustment the IRS made and what kind of income, expense, credit, or deduction you are claiming.

Some examples of proof that you may need are:

W-2 forms, 1099 forms, or other statements that show your income from different sources.
Receipts, invoices, canceled checks, bank statements, or other records that show your expenses or payments related to your business, education, medical care, charity, etc.
Copies of forms or schedules that show how you calculated your credits or deductions, such as Schedule C for business income and expenses, Schedule A for itemized deductions, Form 8863 for education credits, etc.
Copies of letters or notices from other agencies or organizations that confirm your eligibility for certain benefits or exemptions, such as Social Security Administration, Veterans Affairs, state or local government, etc.

The proof you provide should be clear, complete, and relevant to your case. You should also label each document with your name and Social Security number and indicate which item on your notice it relates to. Do not send original documents unless specifically asked by the IRS.

Common Errors on Tax Returns

When you file your tax return, you want to make sure that you don’t make any mistakes that could delay your refund or result in a notice from the IRS. Some of the most common errors on tax returns are:

Miscalculating your income, deductions, credits, or taxes.
Forgetting to report some income or claiming credits or deductions that you don’t qualify for.
Using the wrong filing status, Social Security number, or bank account information.
Not signing your return or attaching the required forms or schedules.

These errors can cause the IRS to change your tax return and send you a CP12 notice. A CP12 notice is a letter that informs you that the IRS corrected one or more mistakes on your tax return and that your refund amount has changed or that you have an overpayment when you thought you owed .

What are some common mistakes people make on their tax returns?

Some of the common mistakes that can lead to a CP12 notice are:

Not reporting all your income, especially if you have multiple sources of income or received a Form 1099.
Claiming credits or deductions that you are not eligible for, such as the Earned Income Tax Credit, the Child Tax Credit, or the education credits.
Misreporting your health insurance coverage or not claiming the premium tax credit if you bought insurance through the Marketplace.
Not reporting changes in your life situation, such as getting married, divorced, having a child, or moving to a different state.

To avoid these mistakes, you should keep accurate records of your income and expenses, check the eligibility requirements for any credits or deductions you claim, and report any changes in your personal information to the IRS as soon as possible.

How can these mistakes lead to a CP12 notice?

If you make a mistake on your tax return that affects your tax liability, the IRS will correct it and send you a CP12 notice. The notice will explain what changes were made and why, and how they affect your refund or balance due. The notice will also include a copy of your corrected tax return and a voucher to pay any additional tax you owe.

If you agree with the changes, you don’t need to do anything. You should receive your refund check in 4-6 weeks, as long as you don’t owe other taxes or debts that the IRS is required to collect . If you disagree with the changes, you should contact the IRS within 60 days from the date of the notice and provide any evidence or documentation that supports your position .

What can I do to avoid these mistakes next time?

The best way to avoid making mistakes on your tax return is to file electronically. Filing online can help you avoid errors and find credits and deductions that you may qualify for. In many cases, you can file for free using IRS Free File or other software programs .

You can also use the IRS Interactive Tax Assistant to find answers to common tax questions, check your eligibility for credits and deductions, and estimate your taxes. You can also visit IRS.gov for more information and resources on how to prepare and file your tax return correctly.

How the IRS Corrects Errors

Sometimes, the IRS may find errors on your tax return that affect your refund amount or balance due. These errors could be related to math mistakes, incorrect credits or deductions, or missing information. When the IRS corrects these errors, they will send you a CP12 notice explaining the changes and the impact on your tax situation. The notice will also tell you what to do if you disagree with the corrections or have any questions.

How does the IRS fix errors on tax returns?

The IRS uses an automated system to check every tax return for errors and inconsistencies. If the system detects an error, it will either correct it automatically or send it to a human reviewer for further verification. The IRS will also compare your tax return with information from other sources, such as your employer, bank, or other government agencies. If there is a mismatch, the IRS will adjust your tax return accordingly.

What does this have to do with my CP12 notice?

A CP12 notice is one of the most common notices that the IRS sends to taxpayers who have errors on their tax returns. A CP12 notice means that the IRS has corrected one or more errors on your tax return and that you have a different refund amount or balance due than what you originally reported. The notice will show you the original and corrected amounts, as well as the reason for the change. You should review the notice carefully and compare it with your tax return and records. If you agree with the corrections, you don’t need to do anything unless you have a balance due. If you disagree with the corrections, you can contact the IRS or file an amended return to dispute them.

How to Prevent Future Errors on Tax Returns

If you received a CP12 notice from the IRS, it means that they corrected an error on your tax return and adjusted your refund or balance due. This can happen for various reasons, such as math errors, incorrect credits or deductions, or mismatched income information. To prevent future errors on your tax returns, here are some tips you can follow:

Double-check your calculations and entries before filing your return. Use a tax software or a professional preparer to help you avoid mistakes.
Review your tax forms and documents for accuracy and completeness. Make sure you report all your income from different sources, such as wages, interest, dividends, self-employment, etc. Also, verify that you claim the correct amount of credits and deductions that you are eligible for.
Keep track of any changes in your tax situation throughout the year, such as marriage, divorce, birth of a child, change of address, etc. These changes may affect your filing status, exemptions, credits, and deductions. You may need to update your withholding or make estimated tax payments to avoid underpaying or overpaying your taxes.
Respond to any notices or letters from the IRS promptly and follow the instructions. If you have any questions or concerns, contact the IRS or a tax professional for assistance.

What are some best practices for doing my taxes?

Doing your taxes can be a daunting task, but it doesn’t have to be. Here are some best practices for doing your taxes that can make the process easier and more efficient:

Organize your records and receipts throughout the year. Keep them in a safe place and categorize them by income, expenses, donations, etc. This will help you prepare your return and support your claims in case of an audit.
File electronically and choose direct deposit. Filing electronically is faster, more secure, and more accurate than filing on paper. It also allows you to receive your refund sooner and avoid delays or errors. Choosing direct deposit is the safest and most convenient way to get your refund directly into your bank account.
Take advantage of free tax help and resources. The IRS offers various tools and services to help you file your taxes, such as the Free File program, the Interactive Tax Assistant, the Tax Withholding Estimator, and more. You can also get free tax assistance from trained volunteers at sites across the country through the Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) programs.
File on time and pay what you owe. The deadline to file your federal tax return is usually April 15, unless you request an extension. However, an extension only gives you more time to file, not to pay. If you owe taxes, you should pay as much as you can by the due date to avoid penalties and interest. You can also apply for an installment agreement or an offer in compromise if you can’t pay in full.

How can I avoid getting another CP12 notice in the future?

A CP12 notice is not a cause for alarm, but it indicates that there was an error on your tax return that the IRS corrected. To avoid getting another CP12 notice in the future, you should take steps to ensure that your tax return is accurate and complete. Here are some things you can do:

Compare your CP12 notice with your original tax return and identify the source of the error. Was it a math error, a wrong entry, a missing form, or something else? Learn from your mistake and avoid repeating it in the future.
Check your refund or balance due status online using the Where’s My Refund? tool or the IRS2Go app. You can also call the IRS at 1-800-829-1954 to get automated information about your refund or balance due.
Update your address with the IRS if you moved since filing your return. You can do this by mailing Form 8822, Change of Address. This will ensure that you receive any future notices or correspondence from the IRS.
Contact the IRS if you have any questions or concerns about your CP12 notice or your tax account. You can call the toll-free number on your notice or visit the IRS website for more information.