CP 11 - Changes to Tax Return, Balance Due - Z Tax & Accounting

The IRS notice "CP 11" means that the IRS corrected one or more mistakes on your Tax Return. As a result, the amount you owe has changed. The notice would show what was changed on your return and how those changes affected the amount you owe. 

Following are the steps for reconciling the return to the notice:

1. First, you will want to verify that the figures under the Your Calculations column, which is generally located on the last page of the CP11, match the figures on your copy of the originally filed tax return.

2. Next, go to the "Changes to Your [Year] Tax Return" section. Review the adjustment reason(s) listed to determine the section of the return affected by the changes. Review this in conjunction with the revised figures under the IRS Calculations column.

3. Once you have identified the area of the return being changed, an amended return can be filed if there are any missed forms or incorret amounts. Typically, the following forms would prompt a notice:

• Form 1099-R

• Form W-2

• Form 1099 Misc.

• Form 1099-INT and 1099-DIV

• Form 1099-B

• Form 1099-G

4. In order to reconcile the return with the proposed changes outlined on the notice, you will need to correct your entries by adding or modifying the information.  

5. You can now respond to the IRS notice.

(a) AGREE: If you agree with the proposed changes, update your tax records and send the IRS your payment along with the voucher (bottom portion of first page). (If you are unable to pay the full balance due, you can make a partial payment or you may request a payment arrangement to pay the amount you owe the IRS. If you wish to pay in installments, please Apply Online for a Payment Plan with the IRS. You may be able to apply online, or you can send the required documents along with your response. The IRS will contact you later with payment information. If an installment agreement is approved, you will be charged a one-time fee.)

(b) DISAGREE: If you disagree with the adjustment, call the IRS using the phone number provided on the first page to discuss your account details. You may also detach and mail the IRS a copy of the Contact Information (bottom portion of second page) along with a signed statement explaining why you do not agree.

This must be done within 60 days of the notice date. If not, you will lose your right to appeal the IRS’s decision. Be sure to attach documentation supporting your claim. Include your phone number (with the area code) and the best time of day to call. Be sure to write your SSN, the tax year, and form number (i.e. 1040, or 1040-A) on each page you’re attaching to the response form. Before mailing your response to the IRS, make a copy of the entire correspondence for your records. If possible, it is suggested you send the response through Certified Mail with Return Receipt requested. The IRS will then review the information and either reverse the proposed changes or forward your case for audit. 

At Z Tax & Accounting, we specialize in helping clients navigate IRS & State tax debt, back taxes, and audit issues with confidence and professionalism. Our team of experienced IRS Enrolled Agents, admitted to practice before the IRS, provides expert representation for IRS audits, collections, and appeals. Whether you are facing personal or business tax challenges, we are here to protect your rights and help you achieve the best possible outcomes. Call us today at (214) 699-4790.