Discussion:CP-2000 Puzzle

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Death&Taxes (talk|edits) said:

5 June 2008
Last December client receives CP-2000 regarding his 2006 Schedule D. There were a number of issues but they boiled down to a missing trade, a trade where client used old name for stock, and a trade where proceeds differed by 3800. We revised the Schedule D, so that his loss of 18,000 became a loss of 14,200. In fact we used 11,200 for the carryover loss for 2007.

I faxed POA and revision of Schedule D to Atlanta; in March we received a duplicate notice so I faxed it again, this time making sure I printed a report showing the fax received. I noted in my transmittal that no additional tax was due, and requested that if the Service did not agree that they send the matter to the Appeals Office in Philly. Btw, accompanying that fax were the brokerage advices showing cost and selling price. My request was based on prior experience with the Atlanta center, where you practically have to hit them over the head to listen.

We have finally received a revised notice; despite the net Schedule D loss, they propose an assessment on the 3800. Is there something wrong in Atlanta? Or am I missing something here?

Joanmcq (talk|edits) said:

5 June 2008
No, there is something wrong with Atlanta, and there has been for a long time. You are right that you have to hit them over the head. I suggest you call and see if you can get a human being to make the adjustment. I find sending a recomputed 1040 with the Sch D helps them to 'see' how the tax should calculate. But as it is, I'm looking at one where they messed up the change in student loan interest deducted because of the change in gain. But at least its in the client's favor. But one from Ogden and one from Fresno are all screwed up and I need to call and try and get them to fix them.

Sigh.

Bonnie (talk|edits) said:

5 June 2008
Well, I'm gald I'm not the only one having trouble. Last year I sent the info in THREE times before they said they actually received it.

This year I have two in the works. I've got my fingers crossed. Good luck!

Waynecpa (talk|edits) said:

5 June 2008
I propose a new question for clients to fix this problem:

"Are there any 1099s that you don't know about?"

Actionbsns (talk|edits) said:

5 June 2008
I have one that's ongoing where the client received a notice that she didn't actually make an IRA contribution in 2005 in the amount of $5000. We have Faxed once and mailed twice the form 5498 from the investment company showing she undoubtedly did make the contribution. Most recent letter said, "We've contacted you twice and you didn't respond....." So I sent copies of both prior repsponses along with our new letter. We communicated to Ogden twice, now we are at Holtsville, NY. Next, if no satisfying, we'll go to the Taxpayer Advocate.

Marcilio (talk|edits) said:

6 June 2008
When I have to respond a 2nd time, I prepare a text box on my Word document. The text box has a dark grey backgound & bold letters about 48 point font stating. "Second Response". I attach a copy of my entire 1st response & mail it. This usually works, but if the client gets a third notice, I repeat the process, state "Third Response" & attach both of the previous letters and attachments. That usually does the trick. One time I went to "Fourth Response" with the State of Illinois, but I had a supervisor call me & the problem was resolved immediately. I guess that was my virtual 2x4.

PBinNJ (talk|edits) said:

6 June 2008
My very elderly client got a CP2000 from IRS with a tax due of 32,000 for unreported trades on Sked D. She almost had a stroke. Schwab had issued a corrected 1099B and the IRS picked it up twice. I finally got someone at the IRS to agree that it was their mistake and a revised notice will be sent out in 3 to 6 weeks. Poor woman won't be feel ok, though, until it that letter comes showing no tax due.

Death&Taxes (talk|edits) said:

6 June 2008
I have to respond to 20+ CP-2000s a year and in almost all cases, my procedure is the same. Get a POA and fax the response to the fax number on the notice, which is sometimes located in a different location than the address on the response part [e.g., many show fax numbers with area codes 215 or 516, but the Service Center address is Kansas City].

Generally responses faxed to Philadelphia (215) or Brookhaven (516) are cleared up in a matter of two months, but for the past three years, Atlanta has been the Bermuda Triangle of Service Centers. Items are faxed there never to reappear. I tried to Federal Express follow up information only to be told by Fedex that there is no place as Chamblee GA with the zip code on the correspondence. When I heard that for the first time, it confirmed my fears that the location was a drop box manufactured to produce Deficiency Notices.

CrowJD (talk|edits) said:

6 June 2008
That zip you used may have been 39901, which still goes to the IRS complex there in Chamblee I believe. Chamblee's true zip is 30341.

To say that this area of Atlanta has a distinctive flair would be to put it mildly. It's Atlanta's Chinatown, or really Asia town; and also has a very large Latino community. Buses leave for Mexico on the hour, and it's not unheard of for people to hail a cab going in that direction. Many of our fellow Americans, and indeed their compatriots from the motherland, work in the area, and it's not unusual to hear Ebonics, Swahili, Zulu or various French and Carribean dialects spoken at the security gate on entrance to certain civic structures located hard by; where these decendants of Pharoah have found gainful employment in government work.

Then, there is a large airport directly abutting IRS complex on the North for the tony private jets and helicopters used by the oil and real estate speculators. Directly abutting that, again to the North is a very active rail line, and again to the North of that is the Marta mass transit rail. This adds the spice of noise to the mix: deafening noise. Map IRS is in the light gray area at the intersection of Chamblee Tucker and Buford Hwy. My understanding is that they are planning to close this entire facility, even though some buildings are brand new. True or not, I don't know.

This may be what Alvin Toffler had in mind with his series of Shock books, hehe. But, it can get right conflusing in that area. Good food though.

Kevinh5 (talk|edits) said:

6 June 2008
true - Atlanta service center to close - Oct 2011

Kevinh5 (talk|edits) said:

6 June 2008
well, I"ll amend that to "return processing in Atlanta will cease Oct 2011", the IRS' contract with their union calls for IRS to re-train the processors as......auditors and collection personnel. Whether they will operate out of the Atlanta Service Center campus or transfer to other offices is up in the air.

Kevinh5 (talk|edits) said:

6 June 2008
return processing has already ceased at the Philadelphia, Memphis and Holtsville campus'

Andover will close Oct 2009

Barbie (talk|edits) said:

7 June 2008
I met with a client today who received a CP-2000 from Fresno saying he owes $23k more for 2006. CA resident, he & wife filed MFS and every single under-reported dividend and capital transaction listed as missing was the half reported on the spouse's return. He was incredulous. The return must have been reviewed by a real newbie there. . .

Joanmcq (talk|edits) said:

7 June 2008
No, the returns aren't reviewed at all before CP2000s go out. It is a computer match. So if H's SSN was first on the account, the IRS computer match is going to look for the full transaction under his SSN. To keep this from happening, you would have to enter the full sales price (sales is the only figure matched) and then back out half the gain or loss.

Never mail responses if you can help it. The mailed in responses go through anthrax checking,and are often lost. Fax 'em. However, the Chamblee fax number on the notices was down for about 9 months (or out of toner or something) so the faxes went into never-never land. WE got at least 5 alternate numbers after NOD after NOD started showing up because Chamblee never got our responses. After I had to go to tax court appeals with one idiotic schedule D NOD that resulted from this, I got an appeals officer who asked why the hell the case was in appeals. I explained about the black hole of Chamblee, and the dead fax machine, and the lost responses, and he was flabbergasted. I got a call back in a few days, and he told me that he told his superior who went up the ladder to the COMMISSIONER who called the head of Chamblee.....and that, if nothing else, at least the fax machine was now working. That was last summer, I think.

I love that AO.

Death&Taxes (talk|edits) said:

7 June 2008
I ran into that dead fax too over a year ago; I called Priority Hotline which gave me a second fax line which must have worked since I received a reply before the 90-day letter was issued. Fax is the only way to go when responding to a CP-2000...your machine can print a report showing receipt just in case you need it.

On my case I spoke with the Hotline yesterday; they suggested sending a copy of the 2007 Schedule D (which was not completed for the last correspondence) to prove that there would be no harm, no foul.

Has anyone noticed how they ignore requests to send the case to appeals if they do not agree with the conclusion you reach?

Natalie (talk|edits) said:

June 8, 2008
I haven't had those experiences with the CP-2000. Since we're talking about IRS notices, however, how about this? The IRS takes payment for part of the 2007 tax liability and deducts it from stimulus payment. Balance of stimulus payment is direct deposited before the end of May. Tax liability for 2007 is now paid in full. CP14 is dated June 2 and indicates there is still a balance due with penalties and interest and says that if taxpayer disagrees, they must call the IRS. What a pain in the butt!

Cotopop (talk|edits) said:

8 June 2008
Because of the problems with faxing,obtaining POA ,and administrative issues with IRS on CP2000 notices, this last year I started filing amended returns on most of the CP2000 notices. (this option offered). On the surface this seems to be inefficient but I can tell you this was not the case for me . I never received any additional requests from IRS on missing documents,assesment notices ,etc.

Joanmcq (talk|edits) said:

9 June 2008
Seems it would be a problem to me because the amended returns go to a different service center than the CP2000s. You've never gotten an NOD by not responding to a CP2000?

Death&Taxes (talk|edits) said:

9 June 2008
The option is offered in the instructions but when you call TP Service and finally get to that part of the skein, they tell you not to file a 1040X.....one side of the mouth does not know what the other side is saying.

The problem with 1040X comes when you have issues where IRS is totally wrong, or any change produces an additional tax of $10......if they do the work with the CP-2000, it will not be charged. I see so many where they ask where the royalties are on Schedule E for authors and the like, missing the same numbers on Sch C.

As I noted, there is such a difference between having your reply processed in Brookhaven or Philadelphia versus Atlanta [this is an East Coast perspective]

Joanmcq (talk|edits) said:

9 June 2008
Yes there is a difference betweeen service centers. Out here we have or had the jewel in the system: Ogden. Until the end of April when for some reason our responses were logged in as received in one building, but not by logged in and recieved by underrreporters until up to 30 days later (this is how it was explained to me when I called Ogden and said 'what happened? you guys are usually the best!). We got stacks of NODs from that. Not sure if there was a change in procedure or what.

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